Latest Payments News: Bank Of America Hit By Cease And Desist Order Due To Compliance Failures, and more

Catch up on some of the stories our payments compliance analysts have covered lately, and stay up-to-date on the latest news.

Bank Of America Hit By Cease And Desist Order Due To Compliance Failures

Bank of America (BofA) must submit an action plan detailing how it intends to remedy alleged anti-money laundering (AML) and sanctions compliance failures, following a cease and desist order.

In December, the US Office of the Controller of the Currency (OCC) issued a cease and desist order in response to BofA’s “unsafe and unsound” practices relating to AML and sanctions compliance.

The order alleges that BofA has failed to file timely suspicious activity reports (SARs) and failed to correct previously identified deficiencies in its customer due diligence (CDD) processes.

BofA neither admits or denies the allegations, but will be required to take “comprehensive corrective actions” to enhance its AML and sanctions compliance programmes.

This will include the hiring of an independent consultant to assess these programmes and to conduct lookback reviews to ensure that all suspicious activity was appropriately reported.

The alleged failures centre on deficiencies in BofA’s compliance with the Bank Secrecy Act (BSA), the foundational law of the US AML framework.

The OCC claims that BofA failed to develop a programme to monitor its compliance with the BSA. It also identified deficiencies in the bank’s BSA officer.

“The Bank had a breakdown in its policies, procedures and processes to identify, evaluate and report suspicious activity,” said the OCC.

“This included a systemic failure to ensure that its transaction monitoring system had appropriate thresholds for determining when transaction alerts should trigger a case investigation.”

Within 30 days of the date of the order, BofA must appoint a compliance committee of at least three members, of which a majority must be directors who are not employees or officers of BofA.

The compliance committee, which will meet at least quarterly and maintain minutes of its meetings, will monitor and oversee BofA’s compliance with the provisions of this order.

Within 90 days of the order, BofA will submit for review a written plan detailing the remedial actions necessary to achieve and sustain compliance with the BSA and all relevant sanctions laws.

Indonesian Central Bank Launches Three New Payment System Offerings

Bank Indonesia has unveiled three new services under its BI-FAST instant payment system, further advancing the nation’s digital financial infrastructure.

The announcement coincides with BI-FAST's third anniversary and aligns with the Indonesian Payment System Blueprint (BSPI) 2030 vision to establish a seamless, efficient and inclusive payment ecosystem.

The new services, which were made available from December 23, 2024, are aimed at simplifying and enhancing financial transactions.

They include features for bulk fund transfers to multiple recipients, payment requests for invoices and individual payments, and automated direct debit options for recurring bills.

The rollout of these services is part of the BI-FAST Phase II implementation, following the launch of individual credit transfer services in 2021.

Initially, nine BI-FAST participants will implement the services based on their readiness, with gradual expansion planned.

To ensure affordability, Bank Indonesia has introduced a competitive pricing scheme. For example, bulk transfer fees are capped at IDR2,100 ($0.12) per transaction for customers, while request for payment and direct debit services are limited to IDR2,500 per transaction.

Additionally, the maximum transaction limit is set at IDR250m, with participants allowed to set lower limits based on their risk policies.

Bank Indonesia has called on all stakeholders, including banks and non-bank institutions, to adopt BI-FAST services to spur innovation in the country’s payment system.

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