Bank of America Fined $1.21B as CZ Questions AML Double Standard

Bank of America shares plunged as much as 9% on Wednesday after the financial giant acknowledged serious anti-money laundering (AML) compliance failures and agreed to pay $1.21 billion in penalties. The settlement sparked criticism from Binance founder Changpeng Zhao (CZ), who questioned why no bank executives faced criminal charges.

According to the U.S. Treasury Department, Bank of America failed to promptly report more than $5 billion in suspicious transactions. Over $1 billion involved potential national security threats, including suspected Chinese money laundering operations.

Regulators found that the bank frequently depended on law enforcement investigations rather than internal monitoring systems to identify suspicious financial activity.

The $1.21 billion penalty reduced quarterly earnings by 17 cents per share. Even excluding the settlement costs, Bank of America's adjusted earnings of $1.08 per share fell short of market expectations.

CZ highlighted the contrasting treatment of traditional banks and cryptocurrency exchanges under U.S. financial regulations. The Binance founder previously served four months in federal prison after pleading guilty to violating U.S. anti-money laundering requirements.

Unlike Binance's criminal case, Bank of America's penalties were imposed by three Treasury agencies through civil enforcement actions. The Justice Department, which handles criminal prosecutions, was not mentioned in the regulatory announcements.

Former HSBC compliance officer and whistleblower Everett Stern also criticized the outcome, urging Treasury Secretary Scott Bessent to pursue criminal accountability against Bank of America executives.

Stern argued that financial penalties alone fail to discourage misconduct because shareholders ultimately absorb the costs.

His criticism recalled HSBC's 2012 money laundering settlement, when the bank paid approximately $1.92 billion after admitting that at least $881 million in drug cartel proceeds passed through its U.S. operations.

Meanwhile, Binance pleaded guilty in 2023 and agreed to pay $4.3 billion for compliance violations, including facilitating $898 million in transactions involving users in Iran. Prosecutors also found that the exchange failed to submit required suspicious activity reports.

U.S. cryptocurrency enforcement policies have since shifted. In April 2025, the Justice Department dissolved its national cryptocurrency enforcement team, while President Donald Trump subsequently pardoned CZ.

Bank of America must now undergo an independent review of previously overlooked suspicious transactions, renewing debate over whether major financial institutions and cryptocurrency companies face consistent regulatory accountability.