U.S. Legislator Raises Corporate Liability, Executive Accountability Questions Following Bank of America’s AML Shortcomings
The recent record-setting financial penalties levied against Bank of America’s over the firm’s multi-year anti-money-laundering failures may represent only the tip of the iceberg with respect to potential regulatory and legal challenges facing the financial services giant. Less than three weeks after the U.S. Treasury Department announced penalties in excess of $1.21 billion against the bank, U.S. Senator Elizabeth Warren (D-MA) has called upon the Department of Justice (DOJ) to launch a full criminal investigation into the bank and, if warranted, prosecute both the institution and executives responsible for its compliance failures.1 The development introduces a potentially more consequential dimension to the case: whether financial institutions and their senior leadership should face criminal accountability when a firm’s systemic failures allow billions of dollars in potentially-illicit funds to move through the U.S. financial system.
Warren, who currently acts as the ranking member of the Senate Committee on Banking, Housing, and Urban Affairs, recently urged Attorney General Todd Blanche to investigate Bank of America’s violations of federal AML laws. The request follows the bank’s October 13th enforcement resolution on a case where federal regulators identified more than $5 billion in suspicious transactions that were not adequately reported to the Treasury’s Financial Crimes Enforcement Network (FinCEN) for investigation.2 The violations ultimately were found to have included activity associated with Chinese money-laundering networks whose presence has continued to grow alongside the illicit narcotics trade at the U.S. southern border, with the actors at hand utilizing trade-based money laundering (TBML) activity to facilitate illicit financial flows between themselves and Mexico-based narcotics dealers and organized criminal organizations. While clearly a substantial figure, Warren described the $1.2 billion total as nothing more than a “slap on the wrist” for a firm of BOA’s stature, arguing that the penalty failed to provide sufficient accountability for the firm’s dealings, as well as those of its banking counterparts, moving forward. Over recent years, even the hardiest of financial penalties issued over AML/CFT failures on the global scale have become little more than a simple cost of doing business for major institutions rather than an effective deterrent against regulatory compliance violations. It can be argued that historically in cases involving even billion-dollar penalties and widespread sanctions issued against multinational firms such as Bank of America, TD Bank, and BNP Paribas, little has been done to actually change the behavior leading to the actions required. Instead, firms of this size have been able to take these penalties and remediation actions in stride with their normal day-to-day operations continuing relatively unimpeded. As a result, regulators and legislators alike have increasingly called for more staunch penalties to be taken against the individuals liable for these compliance failures, including criminal prosecution for their misconduct.
From Regulatory Penalties to Potential Criminal Liability
The question of individual executive accountability remains contentious in the United States. Holding banking and compliance officials criminally accountable in AML/CFT cases raises a multitude of difficult questions about individual knowledge, intent and the extent of personal responsibility over an organization’s failures. As such, prosecutors face the difficult task of proving whether an executive’s conduct satisfies all elements of a true criminal offense. Growing calls for individual accountability however reflect a growing frustration with a regulatory system that consistently sees institutions shrug off substantial penalties, while those governing these firms make out scott-free. Further, while Bank of America admitted to willfully violating the Bank Secrecy Act (BSA); the federal law requiring financial institutions to maintain programs designed to detect and report suspicious financial activity – the distinction between civil regulatory enforcement and criminal prosecution remains significant. In order to convict someone criminally, the government cannot rely solely on the regulatory breach at hand. Instead, it must fulfill every statutory element of the crime in order to satisfy the higher criminal burden of proof. Senator Warren is now asking the DOJ to determine whether the available evidence in this case warrants taking that additional step. Her request also asks the agency to examine the responsibility of Bank of America’s senior executives who oversaw the firm’s faulty compliance operations and failed to respond to both internal and external flags about potential regulatory violations.
One of the elements adding emphasis to Warren’s request is the history preceding the recent enforcement action. Bank of America had already been subject to a cease-and-desist order issued by the Office of the Comptroller of the Currency (OCC) in December of 2024 which required the institution to address previously identified “serious” deficiencies in its anti-money-laundering compliance program. Yet according to the OCC’s October 2026 findings, significant deficiencies persisted well after that order was issued. The investigation ultimately determined that the bank’s monitoring systems failed to adequately identify suspicious activity across trillions of dollars in transactions, with the OCC finding that potentially suspicious transactions were not consistently escalated for investigation, resulting in delayed or inaccurate suspicious activity reports. It was also revealed that Bank of America relied heavily on law enforcement inquiries and referrals from other financial institutions to identify suspicious transactions rather than consistently detecting them through its own internal monitoring systems despite the fact that countless warning signs involving customers receiving large and frequent payments from unknown third parties existed and ultimately were tied back to narcotics proceeds and TBML.
Following their investigation into the firm’s failures, the OCC assessed a $750 million civil money penalty against BOA separate from the Treasury’s fine, the largest penalty in the regulator’s history. Given the advanced notice that remediation action was needed however, the issues now facing BOA are more so related to why meaningful corrective action was not completed even after regulators had clearly identified the problems and formally directed the bank to address them. Thus far, the DOJ has not publicly confirmed that it has (or even plans to) open a criminal investigation against BOA or its executives. Warren has requested a response to her questions by November 12th. All told, the outcome of Warren’s request could help shape the debate over how far federal authorities should go in holding major financial institutions and the executives responsible for overseeing them accountable for failures that expose the U.S. financial system to illicit finance.
Citations
1. Warren calls on DOJ to conduct a criminal investigation into Bank of America’s failure to follow anti-money laundering laws. US Senate Committee on Banking, Housing, and Urban Affairs. Published October 29, 2026.
2. US Department of the Treasury. U.S. Treasury announces record enforcement actions against Bank of America. Published October 13, 2026.