Canadian financial services company TD Bank (TD) is facing additional scrutiny from U.S. senators concerning a money laundering lawsuit. Sen. Ron Wyden (D., Ore.) and Sen. Elizabeth Warren (D., Mass.) co-signed a letter to the company seeking additional details about the roles of its employees in the Da Ying Sze money-laundering case.
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Sze used TD Bank to launder money from illegal fentanyl sales for years before being caught. Investigations from the Department of Justice (DOJ) revealed that many TD Bank employees, including members of management and those higher in its corporate operations, were aware of Sze’s illegal activities. Despite this, no TD Bank employees were charged in the lawsuit, and the company settled for over $3 billion.
Wyden and Warren expressed their outrage over this in their letter to TD Bank. A company spokesperson responded, noting that the company takes responsibility for the failure and is “making significant investments and enhancements to meet regulatory obligations and help protect the financial system.” Additionally, TD Bank CEO Bharat Masrani will retire in April.
What This Means for TD Stock
TD stock hasn’t performed well in 2024, with the money laundering lawsuit weighing on the shares. They are down 13.61% year-to-date and 6.38% over the last 12 months. Despite the letter from senators, shares of TD stock are up 0.66% as of this writing.
TD Bank clearly wants to avoid any future legal trouble over its failed anti-money laundering policies. That means it will likely open discussions with the two senators to avoid a potential subpoena from Congress. As part of its settlement with the DOJ, it also agreed to limit its growth in the U.S. Any further issues could drag its stock down even more.
Is TD Stock a Buy, Sell, or Hold?
Turning to Wall Street, the analysts’ consensus estimate for TD Bank is Hold based on three Buy, five Hold, and one Sell ratings over the last three months. With that comes an average price target of $62.15, a high of $69.83, and a low of $56.29. This represents a potential 17.02% upside for TD shares.
