The Office of the Comptroller of the Currency (OCC) has fined $37.5m, while the Securities and Exchange Commission (SEC) ordered to pay $15m, to settle the charges.
The US bank regulator accused the lender for failing to file suspicious activity reports (SARs) during April 2008 to September 2009, on activity in accounts belonging to Rothstein Rosenfeldt Adler, which operated a $1.2bn Ponzi scheme.
As per the current OCC’s SAR regulation, a bank must report SARs in 30 to 60 days, depending on the circumstances.
The bank, which previously paid more than $600m in compensations to the affected investors impacted by Rothstein’s Ponzi scheme, has agreed to deposit the penalty with the US Treasury.
The SEC claimed that TD Bank and its then-regional vice president Frank Spinosa deceived investors by producing a series of misleading documents and making false statements about Rothstein accounts, which led to massive ponzi scheme.
SEC enforcement division co-director Andrew Ceresney said, "TD Bank through a regional vice president produced false documents on bank letterhead and told outright lies to investors, failing in its gatekeeper role."
Without accepting or rejecting SEC charges, the bank agreed to enter into an administrative order finding for violating Sections 17(a)(2) and (3) of the Securities Act of 1933.
