Bank of America Settles With U.S. Regulator Over Compliance Issues

Bank of America (BAC) has reached an agreement with the Office of the Comptroller of the Currency (OCC) to address deficiencies in its Bank Secrecy Act (BSA) and sanctions compliance programs. The settlement, announced on December 25, 2024, highlights the importance of regulatory compliance and the consequences of failing to meet these standards.

The OCC's cease-and-desist order, issued on the same day, cited several key issues in Bank of America's compliance programs. These included a failure to timely file suspicious activity reports (SARs), inadequate internal controls, poor governance, and deficient independent testing. These lapses led to systemic problems in transaction monitoring and suspicious activity reporting, as well as weaknesses in customer due diligence processes and sanctions compliance oversight.

Bank of America's failure to timely file SARs was a significant factor in the settlement. The OCC's order emphasized the importance of timely SAR filings in maintaining regulatory compliance and protecting the integrity of the financial system. The bank's inadequate internal controls, poor governance, and deficient independent testing contributed to systemic lapses in transaction monitoring and SAR reporting.

The settlement requires Bank of America to take comprehensive corrective actions to enhance its BSA/AML and sanctions compliance programs. This includes hiring an independent consultant to assess the bank's compliance programs and conduct look-back reviews to ensure all suspicious activity was appropriately reported. The bank must also implement a compliance committee and strengthen its internal controls, governance, independent testing, and training components.



The settlement may have long-term financial implications for Bank of America. While no monetary penalty was imposed, the corrective actions required by the OCC may result in increased expenses for the bank. Additionally, the settlement could potentially impact the bank's reputation and customer trust, which could lead to reduced customer acquisition and retention. However, Bank of America's strong financial position and history of navigating regulatory challenges suggest that it is well-equipped to manage these implications and continue its long-term growth trajectory.

In conclusion, Bank of America's settlement with the OCC serves as a reminder of the importance of regulatory compliance in the financial industry. The bank's agreement to address the identified deficiencies and enhance its compliance programs demonstrates a commitment to maintaining the integrity of the financial system and protecting the interests of its customers. As the financial landscape continues to evolve, banks must remain vigilant in their efforts to comply with relevant regulations and maintain the trust of their stakeholders.