TD Bank Sets Aside $2.6 Billion in 3Q for Possible U.S. Anti-Money Laundering Penalties

By Connor Hart

TD Bank has set aside $2.6 billion for fines it is likely to face from U.S. regulators because of weaknesses with its anti-money-laundering practices.

Canada's second-largest bank by market capitalization said Wednesday the third-quarter provision reflects its current estimate of the total fines related to these matters.

"Our remediation program is well underway," Chief Executive Bharat Masrani said. "TD has strengthened its U.S. (anti-money laundering) program with the addition of globally recognized leaders and talent from across the industry, including experts from regulatory agencies, law enforcement and government."

The bank has also made investments to improve its data and technology, training, and process design, he added.

TD additionally said it sold 40.5 million shares of common stock of Charles Schwab, reducing its ownership interest to about 10% from more than 12%.

The Wall Street Journal previously reported that the Justice Department's investigation into the bank was focused on how Chinese crime groups and drug traffickers used the Canadian lender to launder money from U.S. fentanyl sales.

U.S. prudential regulators and the Financial Crimes Enforcement Network are also investigating the bank.

TD last year confirmed the inquiries into its anti-money-laundering compliance program, "both generally and in connection with specific clients, counterparties or incidents in the U.S."

Write to Connor Hart at connor.hart@wsj.com

(END) Dow Jones Newswires

August 21, 2024 18:12 ET (22:12 GMT)

Copyright (c) 2024 Dow Jones & Company, Inc.