Beijing—The Bank of China’s Manhattan branch was hit with a $30 million fine by U.S. regulators on April 29, 2023. The penalty stems from lapses in counter-terror financing checks. Those checks are a core defense against money flowing to terrorist groups. The bank failed them.
The fine lands on an institution with deep roots. The Bank of China was formed in 1912. It was a renaming of the Qing dynasty’s Da-Qing Bank under the new Republican government. Until 1942, it issued banknotes for the state. It was one of the “Big Four” banks of that era. Today, it remains one of China’s “big four” state-owned lenders. Its headquarters sit in Beijing. The Financial Stability Board lists it as a systemically important bank. As of December 31, 2019, it was the second-largest lender in China overall and the ninth-largest bank in the world by market capitalization.
That scale made the failure in Manhattan a problem. Counter-terror financing checks are not optional paperwork. They are the legal barrier between a global bank and the financing of attacks. Regulators found the bank’s systems and controls inadequate. The lapses created a gap. Through that gap, money could have moved to fund terrorist activities. The bank has not commented on the specific allegations. It is likely to defend itself. It may argue the lapses were isolated incidents. It may point to steps taken to improve compliance. The regulator’s findings say otherwise. They say the problem was systemic, not a one-off mistake.
The fine is $30 million. For a bank of this size, that is a cost of doing business. But the reputational hit is sharper. A systemically important bank—one that the global financial system relies on—got caught with weak counter-terror controls in a major U.S. market. That is not a small thing. Manhattan is a financial hub. The branch there handles high-value transactions. If the checks on those transactions were lax, the risk was real.
The Bank of China’s history is long. It survived the fall of the Qing dynasty, the rise of the Republic, war, and revolution. It became a state-owned giant in a communist economy. It expanded into global markets. Its Manhattan branch is part of that expansion. Now it is paying a price for failing to keep up with the rules that come with that global role.
U.S. regulators do not hand out fines like this lightly. Counter-terror financing is a priority. The bank’s defense—if it mounts one—will have to be strong. The facts on the record are against it. The systems were inadequate. The controls failed. The fine was imposed. There is no evidence yet that the bank has accepted the findings. It may fight them. It may settle. Either way, the event is on the record. A major Chinese bank, with a long and complex history, was penalized for failing to block terrorist financing in its New York office.
The broader context matters. This is not the first time a big bank has been fined for weak compliance. It will not be the last. But for the Bank of China, the timing is awkward. It is trying to operate as a global player. Global players are expected to follow global rules. The Manhattan fine suggests that, at least in one branch, the bank was not doing that. The regulator’s findings are clear. The systems and controls were inadequate. The potential for financing terrorist activities was real. The $30 million fine is the consequence.
