WASHINGTON — Federal regulators on Tuesday ordered Bank of America to pay more than $1.2 billion in penalties for widespread failures in its defenses against money laundering, saying the nation's second-largest bank left trillions of dollars in transactions inadequately monitored and failed to report billions in suspicious activity.

The Treasury Department said the bank failed to report more than $5 billion in suspicious transactions, including activity potentially linked to Chinese money-laundering networks, drug trafficking and fraud. More than $1 billion of the unreported activity involved national security-related and other priority illicit finance risks, regulators said.

"Even the biggest financial institutions are not above the law," Treasury Secretary Scott Bessent said in a statement.

The penalty comes a day before Bank of America is scheduled to report third-quarter earnings.

The enforcement action includes a $1.2 billion penalty from the Treasury Department's Financial Crimes Enforcement Network, known as FinCEN. It is the third-largest penalty in the department's history, behind a $3.4 billion fine against cryptocurrency exchange Binance in 2023 and a $1.3 billion penalty against TD Bank in 2024.

The Office of the Comptroller of the Currency, which regulates national banks, separately imposed a $750 million civil money penalty, the largest in that agency's history. The OCC penalty will be credited toward FinCEN's assessment rather than added to it.

The Treasury's Office of Foreign Assets Control also reached a........

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