TD Bank N.A. (TDBNA), the tenth largest bank in the U.S., along with its parent company TD Bank US Holding Company (TDBUSH), has pleaded guilty and agreed to pay over $1.8 billion in penalties due to violations of the Bank Secrecy Act (BSA) and money laundering.
TDBNA admitted to conspiring to maintain an inadequate anti-money laundering (AML) program and failing to file accurate Currency Transaction Reports (CTRs). TDBUSH also pleaded guilty for its role in enforcing these failures. The resolution comes in coordination with various federal regulators, including the Federal Reserve Board and the Financial Crimes Enforcement Network.
Attorney General Merrick B. Garland stated that TD Bank made its services too accessible for criminals, leading it to become the largest bank in U.S. history to plead guilty under the BSA and the first to plead guilty to conspiracy to commit money laundering. He emphasized the ongoing investigation and the potential repercussions for individuals involved in the bank’s misconduct.
Deputy Attorney General Lisa Monaco remarked that TD Bank’s negligence towards its compliance program provided a clear lesson about the consequences of ignoring legal obligations.
Over nearly ten years, TD Bank reportedly neglected to update its AML compliance strategies, making it vulnerable to criminal activity, including facilitating a network that laundered tens of millions of dollars. Federal prosecutors noted that TD Bank’s oversight failures allowed vast sums of money to flow through its accounts, much of which originated from international drug trafficking.
Court documents revealed that from January 2014 to October 2023, TD Bank struggled with systemic deficiencies in its AML policies but failed to take action, enforcing a budgeting mandate that prioritized cuts despite rising profits and risks. Regulators had repeatedly identified issues with the bank’s transaction monitoring, yet little was done to correct these deficiencies.
As part of its plea agreement, TD Bank has agreed to forfeit over $452 million, pay a criminal fine exceeding $1.4 billion, and maintain an independent compliance monitor for three years. The Justice Department highlighted its collaboration with various agencies during the investigation, which has led to charges against numerous individuals, including bank employees.
This case forms part of broader efforts to dismantle high-level criminal organizations through an organized crime initiative. TD Bank’s penalties underscore the critical importance of compliance within financial institutions to maintain the integrity of the banking system.