Public Affairs Office | TD Bank pleads guilty to violations of the Bank Secrecy Act and money laundering conspiracies in a $1.8 billion settlement

WASHINGTON – TD Bank NA (TDBNA), the tenth largest bank in the United States, and its parent company TD Bank US Holding Company (TDBUSH) (together with TDBNA, TD Bank) pleaded guilty today and agreed to pay penalties in the amount of over $1.8 billion to complete the Justice Department's investigation into Bank Secrecy Act (BSA) violations and money laundering.

TDBNA pleaded guilty to conspiring to fail to maintain an anti-money laundering (AML) program compliant with the BSA, failing to file accurate Currency Transaction Reports (CTRs), and laundering money. TDBUSH pleaded guilty to causing TDBNA to fail to maintain an AML program compliant with the BSA and to fail to file accurate CTRs.

TD Bank's guilty pleas are part of a coordinated solution with the Board of Governors of the Federal Reserve Board (FRB), as well as the Treasury Department's Office of the Comptroller of the Currency (OCC) and the Financial Crimes Enforcement Network (FinCEN).

“By making its services convenient for criminals, TD Bank has become one,” said Attorney General Merrick B. Garland. “Today, TD Bank also becomes the largest bank in U.S. history to plead guilty to violations of the Bank Secrecy Act program and the first U.S. bank in history to plead guilty to conspiracy to commit money laundering. TD Bank put profits ahead of compliance with the law – a decision that is now costing the bank billions of dollars in penalties. Let me be clear: Our investigation continues and no individual involved in TD Bank’s illegal conduct is off limits.”

“For years, TD Bank has deprived its compliance program of the resources needed to comply with the law. “Today’s historic admission of guilt, including the highest sentence ever imposed under the Bank Secrecy Act, offers an unmistakable lesson: Crime doesn’t pay – and neither does flouting the rules,” said Assistant Attorney General Lisa Monaco. “Every bank compliance official in America should look at today’s fees as an example of what not to do. And every bank CEO and board member should do the same. Because if the business case for compliance wasn’t clear before, it should be now.”

“For nearly a decade, TD Bank failed to update its anti-money laundering compliance program to address known risks. As bank officials acknowledged in internal communications, these failures made the bank an “easy target” for the “bad guys.” These failures also allowed corrupt bank employees to facilitate the laundering of tens of millions of dollars for a criminal network,” said Nicole M. Argentieri, Assistant Attorney General and Chief of the Justice Department’s Criminal Division. “U.S. financial institutions are the first line of defense against money laundering and illicit financing. If they engage in crimes rather than prevent them, we will not hesitate to hold them accountable to the fullest extent of the law.”

“TD Bank prioritizes growth and convenience over compliance with its legal obligations,” said U.S. Attorney Philip R. Sellinger for the District of New Jersey. “Due to flagrant and widespread oversight failures, there was a willful failure to monitor trillions of dollars worth of transactions – including those involving ACH transactions, checks, high-risk countries and peer-to-peer transactions – enabling hundreds of millions of dollars from money laundering networks flow through the bank, including for international drug traffickers. The bank was aware of these risks and failed to take measures to protect them, including in two networks that were prosecuted in New Jersey and elsewhere – one that dumped piles of cash on bank tellers and another that allegedly ran 40 had withdrawn amounts from ATMs up to 50 times higher than the daily limit for private accounts.”

According to court documents, between January 2014 and October 2023, TD Bank exhibited long-term, widespread and systemic deficiencies in its U.S. AML policies, procedures and controls but failed to take appropriate remedial action. Instead, TD Bank executives enforced a budget mandate, internally referred to as the “flat-cost paradigm,” which mandated that TD Bank's budget not increase year-over-year, even though its profits and risk profile increased significantly over the same period. Although TD Bank maintained elements of an AML program that appeared adequate on paper, fundamental, widespread deficiencies in its AML program made TD Bank an “easy target” for perpetrators of financial crimes.

Over the past decade, federal regulators and TD Bank's internal audit group have repeatedly raised concerns about its transaction monitoring program, a key element of an appropriate AML program necessary to properly identify and report suspicious activity. Yet, from 2014 to 2022, TD Bank's transaction monitoring program remained virtually static and was not adjusted to address known, glaring deficiencies; emerging money laundering risks; or TD Bank's new products and services. TD Bank failed to adequately fund and staff its AML program for years and chose to postpone and cancel necessary AML projects, emphasizing a “cost paradigm” and “customer experience.”

During this time, TD Bank intentionally failed to automatically monitor all domestic Automated Clearinghouse (ACH) transactions, most check activity, and numerous other transaction types, resulting in 92% of total transaction volume not being monitored from January 1, 2018 through April 12 were monitored in 2024. This represented approximately $18.3 trillion in transaction activity. TD Bank also did not add any new transaction monitoring scenarios or make any material changes to existing transaction monitoring scenarios from at least 2014 through the end of 2022; implemented new products and services such as Zelle without ensuring adequate transaction monitoring coverage; Transactions with high-risk countries were not meaningfully monitored; directed stores to stop filing internal reports on unusual transactions for certain suspicious customers; and allowed more than $5 billion in transaction activity to occur in accounts even after the bank decided to close them.

TD Bank's anti-money laundering failures made it “comfortable” for criminals, as its employees put it. These errors allowed three money laundering networks to collectively transfer more than $670 million through TD Bank accounts between 2019 and 2023. Between January 2018 and February 2021, a money laundering network processed more than $470 million through the bank through large cash deposits into nominee accounts. The operators of this program provided employees with more than $57,000 worth of gift cards to ensure that employees could continue to process their transactions. And although the operators of this system clearly deposited well over $10,000 in cash in suspicious transactions, TD Bank officials did not identify the person carrying out the transaction in the required reports. In a second scheme between March 2021 and March 2023, a high-risk jewelry company transferred nearly $120 million through shell accounts before TD Bank reported the activity. In a third scheme, money laundering networks deposited funds in the United States and quickly withdrew those funds at ATMs in Colombia. Five TD Bank employees worked with this network and issued dozens of ATM cards to the money launderers, ultimately resulting in the laundering of approximately $39 million. The Justice Department has charged more than two dozen people with these schemes, including two bank insiders. TD Bank's consent agreement requires continued cooperation in ongoing investigations into individuals.

As part of the plea agreement, TD Bank agreed to forfeit $452,432,302.00 and pay a fine of $1,434,513,478.40, for a total financial penalty of $1,886,945,780.40 . TD Bank has also agreed to engage an independent compliance monitor for three years and to enhance and enhance its AML compliance program. TD Bank has entered into separate agreements with FRB, OCC and FinCEN, and the Justice Department will count $123.5 million of the forfeiture toward the FRB's resolution.

The Justice Department reached a settlement with TD Bank based on a number of factors, including the nature, severity and prevalence of the crimes, making TD Bank the bank of choice for several money laundering organizations and criminal actors and processing hundreds of millions dollars in money laundering transactions. Although TD Bank did not voluntarily disclose its misconduct, it received partial credit for its strong cooperation in the department's investigation and the ongoing cleanup of its AML program. TD Bank was not given full credit for its cooperation as it failed to timely report relevant AML concerns to the Department during the investigation. Accordingly, the total penalty reflects a 20% reduction based on the Bank's partial cooperation and restitution.

IRS Criminal Investigation, the Federal Deposit Insurance Corporation Office of Inspector General and the Drug Enforcement Administration investigated the case. The Morristown Police Department, the U.S. Attorney's Office for the District of Puerto Rico, Homeland Security Investigations, U.S. Customs and Border Protection, and the New York City Police Department provided significant assistance.

Trial Attorneys D. Zachary Adams and Chelsea R. Rooney of the Criminal Division's Money Laundering and Asset Recovery Section (MLARS) and Assistant U.S. Attorneys Mark J. Pesce and Angelica Sinopole for the District of New Jersey prosecuted the case.

MLARS' Bank Integrity Unit investigates and prosecutes banks and other financial institutions, including their officers, managers and employees, whose actions jeopardize the integrity of the individual institution or the entire financial system. Since its founding in 2010, the Bank Integrity Unit has prosecuted financial institutions for violations of the BSA, money laundering, sanctions, and other laws, imposing total penalties in excess of $25 billion.

This effort is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-led, multi-agency approach. For more information about the OCDETF program, visit www.justice.gov/OCDETF.

Information about TD Bank US Holding Company

Information about TD Bank NA

TD Bank US Holding Company Plea Agreement and Attachments

TD Bank NA Objection Agreement and Attachments