TD Bank Fined $3 Billion for Money Laundering Violations

TD Bank, one of the largest banks in the United States, has found itself in hot water after agreeing to pay a whopping $3 billion to settle charges related to money laundering by drug cartels. The bank’s failure to adequately monitor transactions has resulted in a record-breaking fine, with $1.3 billion going to the U.S. Treasury’s FinCEN and $1.8 billion to the DOJ.

The DOJ uncovered serious deficiencies in TD Bank’s anti-money laundering procedures, with over 90% of transactions going unmonitored between 2018 and 2024. This allowed for more than $670 million in money laundering by three separate networks. Attorney General Merrick Garland criticized the bank for enabling criminals and prioritizing profit over legal compliance.

One shocking case involved TD employees accepting gift cards to process $470 million in suspicious cash deposits without reporting them. The OCC stated that the bank processed hundreds of millions in transactions signaling illegal activity. As part of the settlement, TD Bank’s growth in the U.S. will be restricted, similar to actions taken against Wells Fargo in 2018.

CEO Bharat Masrani has apologized for the failures and promised to enhance the bank’s anti-money laundering capabilities. The bank is hiring specialists and implementing new processes to prevent financial crimes. Despite these efforts, TD Bank’s stock fell 6% following the announcement, and the company expects a $1.5 billion post-tax charge.

Critics, including Senator Elizabeth Warren, argue that the penalties do not go far enough in holding bank executives accountable. This is not the first legal challenge for TD Bank, as they settled a $1.2 billion case last year over involvement in a Ponzi scheme. The bank, however, denied any wrongdoing in that instance.