Massive U.S. fine against TD Bank highlights relatively modest penalties in Canada
TORONTO — The more than US$3-billion settlement TD Bank Group has reached with U.S. regulators for its failures to oversee money laundering risks has underlined what some say are relatively weak enforcement options in Canada.
Denis Meunier, president of DMeunier Consulting Inc. and a former deputy director of Fintrac, says fines in Canada have to increase significantly to provide adequate deterrence and not become just a cost of doing business.
He says the federal government should add substantial fines for gross negligence and increase administrative penalties as fines in Canada haven’t risen since 2008.
In Canada, Fintrac can level a maximum fine of $500,000 for each very serious reporting violation, or it can refer violations to potential criminal prosecution.
In contrast, the massive fine announced last week against TD came in part from U.S. rules that allow regulators to fine banks up to $500,000 for each day they lack a functioning anti-money laundering program.
Last year, the Finance Department conducted consultations on how to strengthen Canada’s anti-money laundering regime, and earlier this year it boosted regulatory requirements for several non-bank entities like casinos and title insurers.
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