Banking: Warren demands DOJ probe into Bank of America

Sen. Elizabeth Warren has asked the Department of Justice to open a criminal investigation into Bank of America and its executives. The request, contained in a letter first shared with CNBC, follows the bank's recent admission that it willfully broke federal anti-money-laundering laws. Warren, the ranking member of the Senate Banking Committee, directed her call to Attorney General Todd Blanche.

The senator characterized the more than $1.2 billion in penalties imposed on Oct. 13 as a minor punishment. She wrote that documented violations allowed illicit actors to move billions of dollars through the U.S. financial system. Warren set a deadline of Nov. 12 for the Justice Department to state whether it has already investigated the conduct or plans to do so. Neither the bank nor the Justice Department responded immediately to requests for comment.

The letter arrives shortly after Treasury regulators identified years of compliance failures at the nation's second-largest bank. In a settlement with the Financial Crimes Enforcement Network, Bank of America admitted to violating the Bank Secrecy Act. The bank failed to maintain an adequate anti-money-laundering program and did not properly report suspicious activity.

Regulators found that the bank failed to report more than $5 billion in suspicious transactions in a timely manner. Over $1 billion of those transactions involved national-security risks, including activity linked to Chinese money-laundering networks and U.S. southwest border transactions. Treasury officials stated that the bank sometimes prioritized revenue over compliance and relied heavily on outside law enforcement referrals to identify suspicious activity.

The settlement included a record $750 million fine from the Office of the Comptroller of the Currency. The civil actions did not include criminal charges against the institution or its leaders. Bank of America stated after the announcement that it had invested billions of dollars in compliance and was far along in addressing the identified problems.

Warren argues that civil fines have become a standard cost of doing business on Wall Street. She pointed to federal law that permits both criminal and civil penalties for willful violations of the Bank Secrecy Act. The bank is already operating under a 2024 cease-and-desist order regarding anti-money-laundering control deficiencies. Regulators reported this month that the bank had not made sufficient progress on some of those issues.