TD Bank Agrees to $3B Penalty, Halts Acquisition

TD Bank has agreed to pay over $3 billion in fines and penalties to U.S. regulators for failing to maintain an effective anti-money laundering (AML) program, which allowed money laundering networks linked to organized crime to operate through its systems. The penalties include $1.8 billion to the Justice Department, $1.3 billion to the Financial Crimes Enforcement Network, and $450 million to the Office of the Comptroller of the Currency. TD Bank pleaded guilty to criminal charges, marking one of the largest bank cases in U.S. history, and will face restrictions including an asset cap that limits its growth in the U.S. The bank's lack of oversight allowed hundreds of millions in illicit funds to be processed, with some employees allegedly accepting bribes to facilitate these transactions. U.S. authorities are imposing a monitoring program to ensure TD Bank addresses compliance deficiencies and improves its AML program. This settlement has negatively impacted TD Bank's stock, which has dropped over 5% following the announcement.