TD to Face Growth Limits, $3B Penalty for Money-Laundering Failures: WSJ

Canada’s second-largest bank has faced an array of legal challenges south of the border, including probes by the OCC, the Department of Justice and the Federal Reserve into alleged failures to catch money laundering and other financial crimes at several branches in New York, New Jersey and Florida.

The investigations have had a wide-ranging impact on the bank, including marring the end of Chief Executive Officer Bharat Masrani’s decade-long tenure. He took responsibility for the anti-money-laundering challenges when Toronto-Dominion announced his retirement last month. Raymond Chun, who currently leads its Canadian division, will take the top job on April 10.

Other Matters

Toronto-Dominion was also forced to scrap its $13.4 billion deal to acquire U.S. regional bank First Horizon Corp. last year after saying it couldn’t get timely regulatory approvals.

Spokespeople for the bank and the OCC weren’t immediately available for comment Wednesday, while a representative for the Federal Reserve declined to comment.

The Canadian bank has more than 10 million U.S. customers and almost 1,200 branches concentrated along the East Coast, and its American retail operations account for about a quarter of its revenue. But there have been persistent questions about whether it will be able to continue to expand that business.

Toronto-Dominion recently reached a deal with U.S. prosecutors and regulators to pay more than $20 million to resolve a Treasuries spoofing case and, separately, agreed to pay almost $28 million in fines and restitution for sharing inaccurate U.S. customer data with consumer reporting companies.

(Credit: Bloomberg)