Bank of America Warns of Potential “Public Orders” Over AML Compliance Issues

Bank of America disclosed that it may face “public orders” from federal regulators concerning its anti-money laundering (AML) compliance programs. In its latest quarterly filing to investors, the bank acknowledged it has been in communication with “several” federal regulators about its Bank Secrecy Act/anti-money laundering (BSA/AML) and sanctions compliance programs.

“The Corporation has been engaged with several of its federal regulators in relation to certain aspects of the Corporation’s Bank Secrecy Act/anti-money laundering and sanctions compliance programs (Programs),” Bank of America stated. The firm specified that the issues under review include its transaction monitoring, governance, and customer due diligence protocols. “The Corporation is continuing discussions with its regulators about the Programs, and resolution of these discussions may include one or more public orders by the regulators,” the bank noted.

Bank of America, however, reassured investors that it does not anticipate any “material adverse financial impact” from these discussions. Nevertheless, the bank declined to provide additional details or comment further when contacted by AML Intelligence.

Although the disclosure did not mention any specific disputes, Bank of America faces potential additional scrutiny over separate issues. Reuters reported that the bank is considering potential litigation in connection with a U.S. Consumer Financial Protection Bureau (CFPB) inquiry into its handling of funds processed via the Zelle payment app. According to Bank of America’s filing, CFPB staff has entered discussions with the bank to either settle the inquiry or pursue enforcement action.

Zelle’s rapid rise to become the leading U.S. peer-to-peer payment platform since its launch in 2017 has attracted attention from U.S. lawmakers, including Democratic Senator Elizabeth Warren, who have voiced concerns over the increasing fraud and scams associated with the app. Regulators, too, have raised concerns regarding consumer protection on Zelle.

By fLEXI tEAM