Amex fined US$350 million for anti-money laundering lapses

Federal regulators have imposed a hefty US$350 million penalty on American Express Co. for failing to detect and report money laundering in its system, one of the largest fines handed down by financial authorities during President Donald Trump's second term. The US Office of the Comptroller of the Currency (OCC) cited the bank for deficiencies in its compliance programs, according to a statement released on October 8.

The Federal Reserve also announced a separate enforcement action against the New York-based company, targeting its national bank subsidiary, specifically related to anti-money laundering measures. The OCC stated that the bank had systemic issues in its suspicious activity monitoring and reporting processes, failing to timely identify, evaluate, and report approximately US$13 billion of suspected trade-based money laundering activity that occurred over the past decade.

American Express noted in a regulatory filing that the penalty will not impact its full-year 2026 guidance and that the orders do not impose an asset cap on the firm. The company also stated that costs associated with remedying the issues are not expected to affect its 2027 guidance. The fine contrasts with the trend of deregulation during Trump's second term, as financial watchdogs have generally focused on reducing regulations for large US banks, such as relaxing capital requirements and narrowing the scope of bank supervision.

American Express CEO Steve Squeri acknowledged the need for improvements in the company's compliance programs, stating that the firm identified areas for enhancement through internal and external reviews. Squeri also mentioned that the company reported transactions processed over its network by individuals misusing its products for illicit purchases to law enforcement and took appropriate action.

However, he acknowledged that while meaningful progress has been made, there is still work to be done. Amex is widely recognized for its premium credit cards, including the Platinum card with a US$895 annual fee. The firm also operates a national bank, offering checking and savings accounts to customers. Following the enforcement action, American Express shares fell nearly 2% to US$302.10 in after-market trading on October 8.