Trudeau ‘concerned’ about TD Bank’s actions in US money laundering case – National
Prime Minister Justin Trudeau says the federal government is “concerned” by the actions of TD Bank US subsidiaries that led to historic $3 billion plea deal to settle money laundering fresh this month.
Trudeau made the comments during question period in the House of Commons on Wednesday when NDP MP Don Davies asked him what the Liberals had done to “respond to the repeated criminal actions of TD Bank.”
“We are of course very concerned about the actions of TD Bank in the United States,” the Prime Minister responded.
“We ensure every day that banks in Canada behave in accordance with all the rules. We have continued to strengthen financial oversight and ensure that those responsible for this wrongdoing in the United States are fully held accountable. »
This comment appears to be the first public acknowledgment by Trudeau or any other minister of the affair, which saw TD plead guilty to breaking a US law aimed at preventing money laundering – the largest bank to ever 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 any Canadian financial institution. under federal regulation.
A spokesperson for the office of the Minister of Finance, Chrystia Freeland, told Global News that the deputy prime minister “takes the stability of the Canadian financial system very seriously” and is “monitoring the situation closely” in collaboration with the regulatory authorities.
The US government had accused TD of ignoring multiple red flags from high-risk customers and creating a “convenient” environment for bad actors to exploit. TD failed to monitor more than $18 trillion in customer activity for about a decade, allowing three money laundering rings to move illicit funds through bank accounts, U.S. authorities said.
In addition to the fine of more than US$3 billion, the plea agreement included a rare asset cap on TD’s business interests in the United States, usually reserved for serious cases. The sanction was a blow to TD, which is the 10th largest bank in the United States and which planned to continue its expansion.
Some U.S. politicians have said the sanctions do not go far enough, including U.S. Senator Elizabeth Warren, who said it “allows bad bank executives to be immune from enabling TD to be used as a criminal slush fund.”
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The plea deal also sparked scrutiny of Canada’s relatively modest penalties for similar activity.
In Canada, FINTRAC can impose a fine of up to $500,000 for each very serious reporting violation, or it can refer violations for possible criminal prosecution.
In contrast, the massive U.S. fine stems in part from U.S. rules that allow regulators to fine banks up to $500,000 for each day they fail to have an effective program. to combat money laundering.
The limited fines imposed on Fintrac mean the $9.2 million penalty it imposed on TD earlier this year was the largest ever.
Fintrac said in a statement that in addition to its record sanction against TD, it also demanded that the bank develop an action plan to address its shortcomings, and that the regulator could impose additional sanctions if the bank does not not following his plan.
TD said it is making the investments, changes and improvements necessary to meet its commitments to its anti-money laundering program. New CEO Ray Chun told investors in a conference call the day the U.S. plea deal was announced that TD “will make the necessary changes to put the bank on a stronger footing” and ” respect our commitments to our regulators.”
The federal government undertook public consultations last year on ways to improve and strengthen Canada’s anti-money laundering regime, and strengthened regulatory requirements for casinos and other non-bank entities earlier this year.
The Department of Finance told the Canadian Press in a statement that the government has zero tolerance for financial crimes and is continually working to improve Canada’s ability to combat financial crime.
A spokesperson said the government has introduced a significant number of measures to strengthen money laundering oversight in Canada, including increasing information sharing, and since 2019 has invested nearly $379 million. dollars to fight financial crimes.
Routledge, speaking at a risk conference earlier in October, acknowledged that money laundering was “a bigger risk than I estimated three years ago when I started this work” and that the proliferation of incidents had forced his office to study the issue more closely.
— with files from the Canadian Press
© 2024 Global News, a division of Corus Entertainment Inc.
