The U.S. Department of Justice announced on Thursday its decision to impose a record fine of $3 billion on Toronto-Dominion Bank – commonly known as "TD Bank" – to settle allegations of its failure to properly monitor money laundering activities conducted by gangs for their criminal operations that have accounts at the bank, leading to a guilty plea for violating the Bank Secrecy Act.
According to the department's announcement today, this settlement includes a fine of $1.3 billion to be paid by TD Bank to the Financial Crimes Enforcement Network (FinCEN) of the U.S. Treasury – which is the largest settlement fine ever received by the network from a bank – as well as an additional $1.8 billion fine to the U.S. Department of Justice.
Officials stated in the announcement from the U.S. Department of Justice that TD Bank's failure to monitor transactions between 2018 and 2024 allowed more than $670 million in gang-related funds to pass through its accounts, with regulators finding that over 90% of these transactions were unverified.
The department noted that this shortfall revealed flaws in systemic bank oversight, and the banking regulatory agency indicated that the transfers involved a wide range of criminal activities, ranging from fentanyl and drug trafficking to terrorism financing and human trafficking.
The U.S. Department of Justice emphasized that the Canadian bank's chronic security failures, which have persisted for many years, have created fertile ground for a variety of illicit activities to penetrate the U.S. financial system.
In trading, TD Bank's shares listed on the Toronto Stock Exchange (TD.TO) fell by 5.10% to reach CAD 81.73 following the announcement of the record fine imposed on it, with the bank's market capitalization declining to CAD 143.24 billion (approximately USD 104.13 billion).
