Jefferies: TD fines could reach $4 Billion

That’s the claim by Jefferies Financial Group analysts, reported by Bloomberg, who said the US Department of Justice is currently working with bank regulators and the Treasury Department to evaluate claims that TD staff bypassed anti-money laundering protocols.

“While our previous estimate for the regulatory fines was at $2 billion, given that a third AML issue has been reported, we now believe that this estimate could be low,” Jefferies analysts led by John Aiken wrote in a report.

“Although a $4 billion fine does seem a bit high at this juncture, we cannot deny that it is still within the realm of possibilities, potentially eroding all of TD’s current excess capital.”

One of the significant conspiracies being investigated in relation to the fraud allegations stems from employees working at the New York, New Jersey, and Florida branches.

The US Attorney’s Office for the District of New Jersey has investigated a $653 million drug money conspiracy, as reported by The Wall Street Journal in early May of this year.

The disclosure of these cases followed a statement from the Toronto Dominion Bank’s statement on April 30th declaring that they were to set aside $450 million for potential regulatory fines.

In a media statement, TD Bank said it is committed to working with law enforcement to identify, stop, and support the prosecution of criminals.

“When we became aware of these matters, we took action against these employees, coordinated efforts with the DOJ, and have supported their work to bring these criminals to justice.

“More broadly, where our program was ineffective, we have held those leaders accountable and are taking action to drive the changes and meet our obligations.”