BofA fined 1.6 trillion won for 'neglecting money laundering'

(Seoul = Yonhap News) Reporter Seonghan Lee = The U.S. Treasury announced on the 13th (local time) that it had imposed a fine of $1.2 billion (approximately KRW 1.6 trillion) on Bank of America (BofA) for serious and repeated violations of anti-money laundering and sanctions compliance obligations.

The Treasury Department explained that this action is due to BofA failing to properly warn about more than $5 billion in suspicious transactions linked to an organization suspected of being a Chinese money laundering network and illicit finance along the southern U.S. border.

“Financial institutions are at the forefront of economic and national security,” said Treasury Secretary Scott Besant.

The Financial Times (FT) explained that the Ministry of Finance's announcement comes a day before the third quarter earnings announcement and will deal a big blow to management.

BofA said in a statement, "The third quarter results announced on the 14th will reflect a cost of $1.2 billion, resulting in a 17 cent decrease in earnings per share (EPS). We are doing our best to resolve the problems pointed out by financial authorities and have invested billions of dollars and thousands of people to respond to financial crimes."

The U.S. government has recently been strengthening its crackdown on drug trafficking and money laundering linked to China and Latin America, which are directly related to national security.

The FT reported that this measure by the financial authorities is an extension of the recent all-out pressure on the U.S. financial sector.

President Donald Trump has publicly criticized Brian Moynihan, CEO of BofA, for refusing to open an account for him in the past and excluded him from meetings with top financial executives.

Previously, the Treasury Department imposed a fine of $350 million on American Express for neglecting $13 billion worth of money laundering transactions for over 10 years.