TD Bank pleads guilty to money laundering and receives a record $3 billion fine

Oct. 10 (UPI) — TD Bank, the 10th-largest bank in the United States, has agreed to pay penalties of more than $3 billion over money laundering charges, the Justice Department announced Thursday.

TD Bank NA, the U.S. subsidiary of Toronto-based TD Bank Group, also pleaded guilty to conspiring to fail to comply with an anti-money laundering program under the U.S. Bank Secrecy Act and failing to file accurate currency transaction reports, prosecutors say.

The settlement made TD Bank the largest bank in U.S. history to admit failures in a bank secrecy program and the first U.S. bank in history to plead guilty to a money laundering conspiracy, said Attorney General Merrick Garland.

The bank will pay $1.8 billion to the Justice Department and $1.3 billion to the Treasury Department’s Financial Crimes Enforcement Network, a record fine for the bank.

The combined assets of TD’s two banking subsidiaries will be capped at $434 billion.

“By making its services convenient for criminals, TD Bank has become one of them,” he said in a statement. “TD Bank chose profits over compliance – a decision that is now costing the bank billions of dollars in penalties. Let us be clear: Our investigation is ongoing and no one involved in TD Bank’s illegal conduct has been excluded.”

The Justice Department accused the bank of being aware of the risks of lax supervision and of being exploited by criminals, but deliberately did nothing about it to cut costs, making it an “easy target” for the “bad guys.”

Because it chose profits and convenience over compliance with U.S. banking laws, TD Bank failed to monitor trillions of dollars in transactions, including transactions involving ACH transactions, checks, high-risk countries, and peer-to-peer transactions, thereby enabling “hundreds of millions of dollars from networks occupying money laundering flows through the bank,” including in the case of international drug traffickers.

U.S. Attorney Philip R. Sellinger for the District of New Jersey said bank officials “were aware of these threats and failed to take steps to protect themselves against them,” including: one case in which a criminal network “dumped piles of cash on the bank counter.” while bribing employees with over $57,000 in gift cards.

“We have accepted full responsibility for the failures of our US (anti-money laundering) program and are making the investments, changes and improvements necessary to meet our commitments,” TD Bank Group CEO Bharat Masrani said in a statement. “This is a difficult chapter in the history of our bank. These failures occurred during my tenure as CEO and I apologize to all of our stakeholders.”

The story continues

The company’s CEO, Alan MacGibbon, admitted that money laundering “is a serious global threat and our U.S. facility did not maintain an adequate anti-money laundering program to deter criminal activity.”

The board of directors, he said, “has taken and continues to take actions to address these errors and hold those responsible for them accountable. We have appointed new leaders in our U.S. operations, overhauled our U.S. anti-money laundering team and prioritized investments to make the required changes. “