TD Bank to pay record $3 billion penalty over AML failures

TD Bank, one of the largest financial institutions in North America, has agreed to pay a record $3 billion penalty after pleading guilty to multiple felony charges, including violations of the Bank Secrecy Act and conspiracy to commit money laundering.

This is the largest penalty ever imposed under the BSA and marks the first time a U.S. bank has admitted to such a conspiracy.

U.S. Attorney General Merrick B. Garland announced that TD Bank’s compliance failures allowed financial crime to flourish. The bank’s inadequate anti-money laundering programme from 2014 to 2023 enabled the transfer of over $670 million through three major money laundering networks.

The bank also failed to monitor $18.3 trillion in customer activity, with five bank employees involved in one of the schemes. Senior executives, including a future chief AML officer, were aware of these lapses.

The settlement includes $1.8 billion in criminal penalties, with the total reaching $3 billion when combined with civil enforcement actions. This case represents a significant crackdown by the Justice Department on financial institutions’ role in facilitating financial crime.