Bank of America was hit with more than $1.2 billion in federal penalties Tuesday after regulators said the nation's second-largest bank failed for years to report more than $5 billion in suspicious transactions and fix longstanding anti-money-laundering problems.
More than $1 billion of the unreported activity involved national security and other high-priority risks, including Chinese money laundering networks and activity tied to the southwest border, Treasury said in a press release.
The action also lands less than a day before the bank reports quarterly earnings Wednesday morning.
Treasury's Financial Crimes Enforcement Network, which enforces anti-money-laundering rules, said the $1.2 billion penalty is the third-largest in Treasury history. Treasury separately announced an $11.6 million settlement over sanctions violations.
As part of the settlement, Bank of America admitted that it willfully violated the Bank Secrecy Act by failing to maintain a compliant anti-money-laundering program, conduct required due diligence on foreign correspondent accounts and file suspicious activity reports, according to Treasury.