TD Bank Faces Record $3 Billion Penalty for KYC Anti-Money Laundering Compliance

Consonant with the federal government’s desire to hold accountable financial institutions who fail to vet their clients, thus enabling money laundering, TD Bank will pay $3 billion to settle allegations of its inadequate money laundering controls. This includes a record $1.3 billion penalty to the US Treasury’s Financial Crimes Enforcement Network and $1.8 billion to the Justice Department, where the bank will plead guilty to violating the Bank Secrecy Act. The DOJ cited “systemic deficiencies” in TD’s transaction monitoring, noting that over 90% of transactions went unmonitored from January 2018 to April 2024, enabling three networks to launder over $670 million. TD Bank’s CEO acknowledged these failures and committed to improvements, including hiring 700 specialists for enhanced anti-money laundering efforts.

Under the Anti-Money Laundering whistleblower program individuals who properly report systemic know your client (KYC) failures to FINCEN stand to receive up to 30% of what the government collects, thus, in the instant case there is the potential for hundreds of millions in AML whistleblower rewards and on top of it the individual(s) can potentially stay anonymous from start to finish with an Anti-Money Laundering law firm.

The bank will also face four years of oversight from FinCEN and growth restrictions in the US to ensure it does not expand before having proper infrastructure to ensure compliance with AML-KYC regulations

Amid money laundering concerns, officials at the Justice and Treasury departments are increasingly alarmed by Mexican cartels using the US banking system to launder proceeds from fentanyl and other drugs, contributing to thousands of American deaths each year. A senior Treasury official noted that couriers for the cartels are opening accounts in various US banks, thus now more than ever its critical for financial institutions to ensure AMl-KYC compliance to deter and hold accountable bad conduct. Earlier this year, Treasury and IRS officials began briefing banks and social media companies to better understand how cartels exploit the financial system, focusing on intelligence from smaller banks to identify potential laundering operations in their communities.

Attorney Jason T. Brown,  former DOJ lawyer, who heads up a whistleblower law firm emphasized the importance of AML-KYC vigilance, stating, “If you’re aware of money laundering in any capacity, it’s crucial to consult with a quality. AML whistleblower law firm. They can protect your rights and help guide you through the process of reporting these schemes, as well as potentially keep you cloaked in anonymity.  This settlement is an amazing result  and will create future deterrence and certainly incentivizes other whistleblowers who know of extensive money laundering or systemic KYC failures to step forward.”