Banking Giant Prepares for $3,000,000,000 Fine Over Role in Massive Money Laundering Scheme: Report

A US bank is reportedly setting aside an additional $2.6 billion while preparing to pay a major penalty to regulators.

TD Bank is being investigated over accusations that Chinese gangs relied on the lender to launder $650 million worth of illegal narcotics proceeds from 2016 to 2021.

Now, the bank is preparing for a total resolution on the issue, reports Reuters, having set aside more than $3 billion in anticipation of the incoming, unannounced fine.

To mitigate the impact, the bank is selling some of its stake in Charles Schwab.

Earlier this year, reports emerged that TD is in talks with three US regulators including the Department of Justice (DOJ) over its deficient AML program. In a statement issued to Reuters in May, the bank said its AML controls failed to flag the activities of the drug traffickers. A former employee at the bank is also accused of taking a bribe to facilitate the transactions.

In its latest earnings news release, TD says it suffered losses to the tune of $181 million in Q3 of this year due to the impact of civil and criminal investigations into its AML program. TD CEO Bharat Masrani says addressing the lender’s AML inadequacies is one of his top priorities.

“We recognize the seriousness of our U.S. AML program deficiencies and the work required to meet our obligations and responsibilities is of paramount importance to me, our senior leaders, and our Boards.

Our remediation program is well underway. TD has strengthened its U.S. AML program with the addition of globally recognized leaders and talent from across the industry, including experts from regulatory agencies, law enforcement and government…

TD continues to work constructively with our regulators and law enforcement towards resolution of our U.S. AML matters and looks forward to bringing additional clarity to our shareholders, clients and other stakeholders.”

TD says it expects a global resolution to the regulatory probes by the end of the year.

TD’s US arm, based in Wilmington, Delaware, has over $370 billion in assets under management and is currently the 10th-largest commercial bank in the US.

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