EagleBank to Pay More Than $9.7M to Resolve Bank Secrecy Act Investigation

Posted July 8, 2026

By the Constantine Cannon Whistleblower Team

On June 30, the DOJ announced its latest Bank Secrecy Act enforcement action, with EagleBank and its parent company Eagle Bancorp Inc. (collectively EagleBank) agreeing to pay more than $9.7 million to resolve AML compliance failures.[1]

EagleBank, which operates in Maryland, Virginia, and D.C., also entered into a non-prosecution agreement in which EagleBank admitted it willfully failed to maintain an effective anti-money laundering and countering the financing of terrorism (AML/CFT) program from 2010 to 2021, violating the Bank Secrecy Act.

One of the more serious allegations involved a years-long check-kiting scheme. According to the agreement, EagleBank allowed two customers, a father and son, to carry out the scheme through EagleBank accounts for over a decade. The father was allegedly a friend and business partner of EagleBank’s former chairman and CEO, who resigned in 2019.

What is Check Kiting?

Check kiting is a type of bank fraud where an individual writes a check for more money than is available in the account and deposits it into an account at another bank, relying on the delay in processing to obtain the funds before the insufficient funds are detected.

Fraudsters often sustain such schemes by repeatedly writing bad checks between accounts at different banks, exploiting processing delays to create the appearance of sufficient funds and cover overdrafts.

What Was the Alleged Scheme?

According to the Justice Department, senior bank executives repeatedly overrode compliance personnel’s efforts to close the accounts to stop the fraudulent activity. As a result, EagleBank enabled the scheme for several years, resulting in nearly $6.3 million in losses to another financial institution.

Under the non-prosecution agreement, EagleBank agreed to pay a criminal fine of $9,057,821.62 and a forfeiture of $736,515. The forfeiture includes EagleBank’s earnings from overdraft fees on accounts linked to the check kiting scheme.[2]

EagleBank has agreed to take further remedial measures to boost its AML/CFT program, to cooperate with the DOJ’s investigation, and to report violations of federal criminal law going forward.

Comments on the Case

Assistant Attorney General A. Tysen Duva of the DOJ’s Criminal Division shared: “Financial institutions are the first line of defense against financial crimes and must be gatekeepers, not gateways, for criminal activity. As this resolution makes clear, when banks deliberately allow unlawful conduct to persist, the Criminal Division will ensure they are held accountable.”[3]

“Financial institutions have a legal obligation to detect and prevent money laundering, and this case serves as a reminder that the government will pursue enforcement actions when those responsibilities are ignored,” said Constantine Cannon partner Marlene Koury.

Were Whistleblowers Involved in this Case?

While it is unknown whether whistleblowers were involved in this action, the FinCEN AML/Sanctions Whistleblower Program rewards whistleblowers for reporting anti-money laundering (AML) violations under the Bank Secrecy Act (BSA) and U.S. sanctions violations that lead to successful enforcement actions. Eligible whistleblowers may receive up to 30% of the government’s recovery from the resulting AML or sanctions enforcement action.

Constantine Cannon partners Gordon Schnell and Marlene Koury recently submitted comments to the proposed rules for the FinCEN AML/Sanctions Whistleblower Program. To read more, check out our blog post here.

We also recently covered how FinCEN is moving closer to issuing its first award under its AML/Sanctions Whistleblower Program. Read more here.

Our Firm Has Significant Experience Representing Whistleblowers Under FinCEN’s AML/Sanctions Whistleblower Program

Constantine Cannon has significant experience representing whistleblowers under the FinCEN program. If you have information pertaining to potential AML and sanctions violations, please contact us. We will connect you with an experienced member of our whistleblower team for a free and confidential consultation.