American Express Hit With $350 Million OCC Penalty Over Anti-Money-Laundering Failures
Despite decades of regulatory reforms, billions of dollars-worth of collective enforcement actions and the arrival of increasingly sophisticated financial surveillance systems to the realm of mainstream finance, anti-money-laundering and counter-terrorism financing (AML/CFT) failures continue to persist both domestically and abroad, creating vulnerabilities for all parties operating across international banking sector and allowing illicit funds to move through the global financial system without appropriate oversight. From the misuse of shell companies and trusts to cybercrime, to sanctions evasion, financial institutions have had to cast an increasingly wide net to cover their compliance-specific responsibilities over the last two decades. However, weaknesses in internal protocols and even basic suspicious activity reporting continue to undermine larger efforts to detect and disrupt financial crime. A newly announced enforcement action taken by a prominent federal regulator demonstrates just how severe the consequences can be for firms small and large when compliance programs fail to keep pace with the scale and complexity of modern banking.
Last week, American Express National Bank was recently hit with a major civil money penalty to the tune of $350 million by the Office of the Comptroller of the Currency (OCC) after regulators identified significant and long-standing deficiencies in the bank’s anti-money-laundering (AML) program.2 The enforcement action, formally announced October 8th, centered on failures in the firm’s capacity to adequately identify, monitor and ultimately report upwards of $13 billion in suspected trade-based money laundering activity over nearly a decade-long period, with the regulator’s investigations also revealing unique national security risks created by the bank’s repeated compliance failures.
Trade-based money laundering, which according to the Financial Action Task Force is the process of disguising the proceeds of crime and moving value across borders through the use of legitimate international trade transactions3 is used primarily by bad actors as a means to exploit the complexity of international commerce to move illicit funds while limiting their chances of detection. In this process, criminal networks often manipulate invoices, misrepresent shipments or distort the value of goods to make illicit proceeds appear as legitimate commercial transactions. Detecting these schemes requires banks to evaluate customer profiles, counterparties, transaction patterns and the purpose behind these payments often a tedious process once automation runs its course. The legwork involved in this screening process has led to countless hiccups albeit generally at a smaller scale for international firms over the past decade.
The OCC’s findings in this case point to systemic weaknesses rather than isolated reporting errors or overlooking of a few choice transactions on AmEx’s behalf. According to the OCC, American Express National Bank’s risk assessments focused far too heavily on its deposit-account business while inadequately addressing its larger credit- and charge-card operations, ultimately leaving significant gaps in the bank’s ability to identify and report suspicious activity affecting this area of their business. Even in cases where suspicious activity was detected, the firm was found to have lacked the internal controls and monitoring capabilities to timely identify and report their full scope.1 Regulators chalked these developments up to a plethora of shortcomings including inadequate staffing, deficiencies in internal controls, insufficient independent testing and inadequate training for employees and directors as the root causes of these slip-ups. The agency also identified shortcomings in the firm’s customer identification and due diligence protocols, as well as the bank’s overall approach to assessing money-laundering risks, each of which also affecting the company’s bottom-line.
“The OCC expects banks of American Express’s size and complexity to devote sufficient resources to ensure compliance with laws and regulations designed to detect and prevent money laundering, which are critical to both economic and national security,” said Comptroller of the Currency Jonathan Gould following the penalty. Today’s actions will serve to focus American Express on properly addressing such risks as it continues to serve its customers.”2 Accompanying the financial penalty, the OCC issued a cease-and-desist order requiring immediate corrective action. Following the action, American Express CEO Stephen Squeri stated that the company was committed to addressing regulators’ concerns and improving its compliance program. These improvements are expected to include expanded compliance staffing, more thorough transaction reviews, improved monitoring systems and enhanced oversight as the bank must fully demonstrate to regulators that its corrective measures adequately address the above-mentioned deficiencies.
These findings are significant in that American Express ranks as the second largest credit-card issuer in the U.S. by volume of transactions, with nearly 87 million cards in circulation and total charges approaching $1.7 trillion in 2025 alone. The company also accepted $153 billion of deposits from customers last year.1 As such, the true scope of their improprieties could be much larger than that discovered in the OCC’s most recent investigation. All told however, the enforcement action sends a broader message to American banks: compliance programs must reflect the full scope of an institution’s customer base and risk exposure or risk both exposure to financial crime risks as well as staunch financial penalties.
The $350 million penalty places American Express among the recipients of the OCC’s largest civil money penalties in history, with the record total being $500 million levied against both HSBC Bank USA in 2012 over Bank Secrecy Act (BSA) violations and deficiencies in its anti-money-laundering controls, as well as Wells Fargo in 2018 over broader compliance failures and harmful consumer banking practices.
Citations
1. Association of Certified AntiMoney Laundering Specialists (ACAMS). OCC, Fed tag Amex with $350 million penalty. 8 October 2026.
2. Office of the Comptroller of the Currency. OCC assesses $350 million civil money penalty against American Express. 8 October 2026.
3. Financial Action Task Force. Trade-based money laundering. Published 2006.