TD’s chief compliance officer departs amid US anti-money laundering probe

TORONTO (Reuters) – TD Bank’s chief compliance officer has left the bank, according to a memo sent internally, at a time the Canadian lender faces U.S. regulators and the Justice Department in a probe related to its anti-money laundering program.

Monica Kowal, who joined the bank in 2017, left the company this week, and will be replaced by Deputy Chief Compliance Officer Erin Morrow who will report to Chief Risk Officer Ajai Bambawale, according the memo sent in late June, seen by Reuters.

Bambawale did not address the reason for Kowal’s departure in the memo. Chief Executive Officer Bharat Masrani has previously said the bank has acted against responsible employees, including termination.

TD declined to comment about Kowal’s departure. Kowal was not immediately available for comment.

Morrow joined TD in January after spending over a decade at U.S. bank Citi. TD also hired Marcy Forman and Jacqueline Sanjuas from Citi and its Chief Global Anti-Money Laundering Officer Herbert Mazariegos from BMO to revamp the team.

The bank said it has invested over $500 million on training programs, onboarding hundred of AML professionals and hiring executives to lead its regulatory program after Masrani said the bank’s AML program fell short and did not effectively monitor, detect, report or respond. It is “unacceptable,” he said in May.

The bank has also taken an initial provision of $450 million and has said it anticipates additional monetary penalties. The fines may total as much as $4 billion, analysts have said.