TD Bank Fined a Record Amount over More than $1 Billion Crypto Transactions with UK and Colombian Exchanges
TD Bank has agreed to the largest settlement in history, in excess of $3 billion in fines after accusations that the company failed to properly monitor cryptocurrency transactions associated with exchanges in both the United Kingdom and Colombia. According to a report by the Financial Crimes Enforcement Network, more than $1 billion in transactions were connected to two unnamed cryptocurrency firms based in both countries.
FinCEN Report Outlines Crypto Ties
In the report by FinCEN on Oct. 10, the agency said TD Bank had processed more than $1 billion in transactions on behalf of a customer group related to cryptocurrency. Referred to as “Customer Group C,” it processed the majority of its incoming transfers from a UK-based exchange and sent more than 60% of its outgoing funds to a Colombian financial institution offering virtual asset services.
FinCEN said the transaction volume was considerably inconsistent with the customer’s onboarding documentation, which raises AML concerns. The customer business operations were primarily tied to high-risk jurisdictions such as Colombia, China, and the Middle East.
$650 Million More Transferred From A UK Exchange
The report puts the amount at over $650 million in bank transfers that TD Bank cleared from an international cryptocurrency exchange for Customer Group C. Even if the source of this cash is not well defined, that did not stop TD Bank from continuing with the transfers. More than $420 million was wired to a financial institution in Colombia reportedly offering cryptocurrency services, the report said.
Past Crypto Involvement by TD Bank
TD Bank was set to enter the crypto market through its subsidiary TD Cowen, which launched its digital asset unit in 2022. However, the bank’s crypto business reportedly closed in 2023, just three months after finalizing the takeover deal of Cowen Bank. The wind-down of the crypto business coincides with a number of high-profile crypto company collapses and increased regulatory scrutiny in the United States.
Conclusion
This case is a lesson to be learned regarding the gravity of robust oversight in the cryptocurrency space. It remains the fact that the failure of TD Bank to rightly monitor and report suspicious transactions has turned into one of the most notable fines in recent history, pointing out risks from not having adequate compliance measures in an increasingly complex financial landscape.
