The Toronto Dominion Bank has paid a $6.5 million fine after federal regulators found it had withheld nearly $72 million in credit card fee rebates from thousands of customers over a period of two decades. Blacklock's Reporter says the Financial Consumer Agency of Canada (FCAC) announced the fine, citing TD’s failure to implement adequate compliance controls and monitoring that led to this prolonged error.“The penalty amount reflects that the bank was negligent in failing to implement controls and effective compliance monitoring measures to prevent and detect the error over 20 years,” the FCAC said in a statement. The agency noted the extent of the harm, with approximately 255,886 customers affected, some dating as far back as 2001. “The degree of harm was very significant given the length of time of the violation, the number of customers affected, and the financial impact,” it added.According to an FCAC report, TD Bank had systemically failed to issue annual fee rebates on credit card accounts over the period from 2001 to 2023. The FCAC confirmed that all known affected customers were reimbursed, while refunds for deceased or unreachable customers were donated to a charity. The FCAC did not disclose the identity of the charity.The investigation revealed that the error stemmed from TD employees improperly entering fee rebate data due to procedural gaps, which resulted in customers not receiving promised credits on monthly statements.The FCAC has only disclosed the names of banks involved in consumer protection breaches since 2020, following the enactment of Bill C-86 in 2018, which also raised the penalty cap from $500,000 to $10 million. Previously, the agency had withheld the names of banks involved in violations, a practice criticized by consumer advocates who argued for greater transparency to protect customers.“The current rules are deeply unsatisfactory,” said John Lawford, executive director of the Public Interest Advocacy Centre, during a 2016 Senate banking committee hearing on consumer protection standards.
The Toronto Dominion Bank has paid a $6.5 million fine after federal regulators found it had withheld nearly $72 million in credit card fee rebates from thousands of customers over a period of two decades. Blacklock's Reporter says the Financial Consumer Agency of Canada (FCAC) announced the fine, citing TD’s failure to implement adequate compliance controls and monitoring that led to this prolonged error.“The penalty amount reflects that the bank was negligent in failing to implement controls and effective compliance monitoring measures to prevent and detect the error over 20 years,” the FCAC said in a statement. The agency noted the extent of the harm, with approximately 255,886 customers affected, some dating as far back as 2001. “The degree of harm was very significant given the length of time of the violation, the number of customers affected, and the financial impact,” it added.According to an FCAC report, TD Bank had systemically failed to issue annual fee rebates on credit card accounts over the period from 2001 to 2023. The FCAC confirmed that all known affected customers were reimbursed, while refunds for deceased or unreachable customers were donated to a charity. The FCAC did not disclose the identity of the charity.The investigation revealed that the error stemmed from TD employees improperly entering fee rebate data due to procedural gaps, which resulted in customers not receiving promised credits on monthly statements.The FCAC has only disclosed the names of banks involved in consumer protection breaches since 2020, following the enactment of Bill C-86 in 2018, which also raised the penalty cap from $500,000 to $10 million. Previously, the agency had withheld the names of banks involved in violations, a practice criticized by consumer advocates who argued for greater transparency to protect customers.“The current rules are deeply unsatisfactory,” said John Lawford, executive director of the Public Interest Advocacy Centre, during a 2016 Senate banking committee hearing on consumer protection standards.