Inside TD Bank’s anti-money laundering effort
Bank was fined over $3B by U.S. entities for AML compliance failures
TD Bank is investing in its anti-money laundering efforts via technology, systems and personnel as it continues to restructure on the heels of hefty U.S. fines.
In 2024, the Toronto-based bank was fined $1.3 billion by the Financial Crimes Enforcement Network and $1.8 billion by the U.S. Department of Justice for failing to comply with anti-money laundering (AML) laws.
In its fiscal third quarter, the bank shared its efforts to prioritize AML remediation plans.
“We’ve now completed a series of important milestones,” Leo Salom, president and chief executive at TD Bank, said today during the bank’s earnings call for the third quarter ended June 30.
During the quarter, the $2 trillion bank’s AML remediation plans included:
- Deployment of machine learning for transaction monitoring;
- Launch of suspicious activity detection training for employees; and
- Established the Financial Crimes Risk Management Subcommittee that will be “dedicated to the assessment and oversight of financial crime risk of new business products and services,” Salom said.
More ML to come
With machine learning (ML) in place to monitor transactions, the bank also plans to launch tech for further AML detection.
In the coming quarters, ML will be deployed for:
- Customer screening enhancements; and
- Addressing high-risk typologies; and
- Interdependency of the bank’s tech platforms.
The ML “will continue to improve the effectiveness and efficiency of our program, allowing our AML team to focus their investigative expertise and intelligence,” Salom said.
The bank is also ramping up other risk areas like cybersecurity and fraud detection, Ajai Bambawale, group head and chief risk officer, said during the earnings call.
By the numbers
In Q3, TD reported:
- Digital adoption increased 95 basis points year over year to 57.6% of users on U.S. retail digital channels;
- Mobile users on U.S. retail digital channels increased 2.1% YoY to 5.25 million;
- Adjusted net income reached $3.8 billion, up 6% YoY; and
- Efficiency ratio clocked in at 55.7%.
