Trudeau ‘concerned’ about TD Bank’s actions in US money laundering case – National

Prime Minister Justin Trudeau says the federal government is “concerned” about the actions of TD Bank’s U.S. subsidiaries, which this month led to a historic $3 billion settlement to resolve money laundering allegations.

Trudeau made the comments during question period in the House of Commons on Wednesday when he was asked by NDP MP Don Davies what the Liberals had done to “counter repeated criminal acts by TD Bank.”

“We are of course very concerned about the actions of TD Bank in the United States,” the prime minister replied.

“We make sure every day that banks in Canada follow all the rules. We have further strengthened financial oversight and are ensuring that those responsible for this misconduct in the United States are held fully accountable.”

The comment appears to be the first public admission by Trudeau or another minister in the case, in which TD pleaded guilty to violating a U.S. anti-money laundering law – the largest bank ever to do so.

At the time the settlement was announced, Canada’s Superintendent of Financial Institutions, Peter Routledge, said in a statement that the information disclosed in the case was “serious” but could not comment on the affairs of a federally regulated Canadian financial institution.

The US government had accused TD of ignoring multiple warning signs from high-risk customers and creating a “convenient” environment for malicious actors to exploit. TD failed to monitor more than $18 trillion worth of customer activity for about a decade, allowing three money laundering networks to move illicit funds through accounts at the bank, U.S. authorities said.

In addition to the more than $3 billion fine, the plea deal included a rare asset cap on TD’s U.S. business interests, usually reserved for serious cases. The penalty was a blow to TD, the 10th-largest bank in the U.S., which was planning further expansion.

Some U.S. politicians said the penalties didn’t go far enough, including U.S. Sen. Elizabeth Warren, who said it exonerated “bad bank managers for allowing TD Bank to be used as a criminal slush fund.”

The settlement agreement has also led to a review of Canada’s relatively low penalties for similar activities.

In Canada, Fintrac can impose a maximum fine of $500,000 for each very serious reporting violation or potentially prosecute violators.

In contrast, the high American penalty is due in part to U.S. regulations that allow regulators to impose fines of up to $500,000 on banks for each day they do not have a functioning anti-money laundering program.

The limited penalties available to Fintrac mean that the $9.2 million penalty imposed on TD earlier this year was the largest the company has ever imposed.

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Fintrac said in a statement that in addition to the record fine against TD, it also required the bank to develop an action plan to address its deficiencies and that the regulator could levy additional penalties if the bank fails to implement its plan.

TD has stated that it is making the investments, changes and improvements necessary to meet its obligations with respect to its anti-money laundering program. New CEO Ray Chun told investors in a conference call on the day the U.S. plea was announced that TD “will make the necessary changes to place the bank on a stronger footing” and “meet our obligations to our regulators.”

The federal government conducted public consultations last year on ways to improve and strengthen Canada’s anti-money laundering regime and earlier this year tightened regulatory requirements for casinos and other non-banks.

The Treasury Department told The Canadian Press in a statement that the government has zero tolerance for financial crime and is continually working to improve Canada’s ability to combat financial crime.

A spokesperson said the government has taken numerous measures to strengthen Canada’s money laundering oversight, including increased information sharing, and has invested nearly $379 million to combat financial crime since 2019.

Global News has reached out to Finance Minister Chrystia Freeland’s office for further comment on Trudeau’s comments.

Speaking at a risk conference in early October, Routledge acknowledged that money laundering was “a greater risk than I estimated three years ago when I took the job” and that the increasing incidents had forced his office to take a closer look at the matter investigate.

– with files from the Canadian Press

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