Toronto-Dominion Bank (TD) is embroiled in a significant financial scandal, with potential fines reaching up to $4 billion, due to fresh allegations related to money laundering activities in its U.S. branches. The U.S. Department of Justice, bank regulators, and the U.S. Treasury Department are currently investigating TD over these allegations. Instances of misconduct include a former branch employee in Florida accepting bribes to facilitate illegal money transfers to Colombia, and another employee in New York admitting to bypassing compliance measures to defraud a customer.
Recent cases, including a $653 million drug money laundering conspiracy involving TD branches, have prompted the U.S. Attorney’s Office for the District of New Jersey to file at least four cases against the bank. Initially, TD allocated $450 million for possible regulatory penalties, though estimates vary widely among analysts, ranging from $1 billion to as much as $3 billion. The bank also faces a proposed shareholder class-action lawsuit alleging misrepresentation of its anti-money-laundering controls, which has led to a significant drop in its stock price. Despite these challenges, TD maintains that its disclosures have been accurate and intends to contest the allegations.
