TD Bank expects penalties from probes into its compliance with anti-money-laundering rules
Toronto-Dominion Bank says it’s been receiving inquiries from regulators and law enforcement about its compliance with anti-money-laundering rules, including requests related to a United States Department of Justice investigation.
Canada’s second-largest bank made the disclosure in its third-quarter financial results on Aug. 24, and said it may face penalties as a result of the probe.
“The bank is cooperating with such authorities and is pursuing efforts to enhance its Bank Secrecy Act/anti-money-laundering compliance program,” the Toronto-based company said. “While the ultimate outcomes of these inquiries and investigations are unknown at this time, the bank anticipates monetary and/or non-monetary penalties to be imposed.”
A spokesperson for the Justice Department declined to comment. TD executives didn’t elaborate on the nature of the investigation during a conference call with analysts.
Toronto-Dominion had a deal to buy Tennessee-based First Horizon Corp., but the transaction fell apart in May after the bank said it couldn’t secure timely approval from regulators. The acquisition was held up by concerns about TD’s handling of suspicious customer transactions, a person familiar with the matter told Bloomberg News at the time. The regulators’ concerns were related to anti-money-laundering practices, the person said.
The decision to walk away from the US$13.4-billion deal shocked markets even though the acquisition had looked shaky since early March, when the Memphis-based lender disclosed that Toronto-Dominion had said it didn’t believe it could get regulators to sign off by a May 27 deadline. It would have been TD’s largest deal ever, adding more than 400 bank branches in the U.S. southeast.
Toronto-Dominion could
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