(Reuters) – TD Bank is close to potentially pleading guilty to criminal charges that its U.S. retail bank failed to curb money laundering linked to Chinese criminal groups and illicit sales of fentanyl, the Wall Street Journal reported on Friday.
Canada’s second-largest bank is in talks with US federal prosecutors and its US retail arm is expected to file a plea within two weeks, the report said, citing unnamed people familiar with the matter.
TD Bank and the US Department of Justice did not immediately respond to Reuters’ requests for comment. The bank said in May that it had undertaken a comprehensive overhaul of its US and global anti-money laundering programme.
The bank said at the time that it had invested more than C$500 million (US$400 million) in software overhaul and platform improvements because it was the subject of regulatory investigations over its money laundering compliance program in Canada and the United States.
The newspaper said that US authorities claimed that TD was reckless in failing to build and maintain systems to prevent money laundering.
The newspaper said that the parent company allocated more than $3 billion to cover the costs of resolving the US government investigations.
The Justice Department launched an investigation into the bank after agents uncovered an operation in New York and New Jersey that laundered hundreds of millions of dollars in illicit drug proceeds through TD and other banks, the newspaper reported in May.
($1 = 1.3512 Canadian dollars)