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TD Bank Ponzi scheme settlement overview:
- Who: TD Bank has agreed to pay $1.2 billion to resolve claims it was involved in a $7 billion Ponzi scheme masterminded by disgraced financier Allen Stanford.
- Why: Investors claimed TD Bank either knew or should have known about the Ponzi scheme and helped aid and abet it by ignoring red flags about fraudulent certificates of deposit administered by an offshore bank in Antigua.
- Where: The settlement averted a trial that was to be held in Texas federal court.
TD Bank has agreed to pay $1.2 billion to resolve claims the company was involved in a $7 billion Ponzi scheme masterminded by convicted former financier Allen Stanford more than a decade ago.
Stanford was sentenced to 110 years in federal prison in 2012 after being convicted of fraud following charges that his investment company, Stanford Financial Group of Companies, had been the vehicle for the Ponzi scheme, reports CNN Business.
TD Bank, meanwhile, has — while maintaining that it did not do anything wrong — reportedly agreed to pay victims of the Ponzi scheme to end claims it collected, in US and Canadian dollar values, billions worth of fraudulent certificates of deposit.
The fraudulent certificates of deposit were administered by an offshore bank in Antigua called Stanford International Bank Ltd., which TD Bank is accused of ignoring red flags about for years, reports CNN Business.
TD Bank has reportedly denied any liability or wrongdoing in connection to the Ponzi scheme, while arguing that it simply “provided primarily correspondent banking services” to Stanford International Bank and “acted properly at all times.”
TD Bank settlement agreement averts trial in Houston federal court
The settlement agreement announcement averted a trial that was set to begin the same day at a federal court in Houston, reports CNN Business.
In addition to TD Bank, defrauded investors reportedly claimed Trustmark, Independent Bank Group — formerly Bank of Houston —, HSBC, and Societe Generale Private Banking all either knew or should have known about the alleged Ponzi scheme and aided and abetted it.
HSBC has agreed to pay $40 million to resolve the claims made against it, while Independent Bank will pay $100 million — bringing the total recovery for the defrauded investors to more than $1.6 billion, reports CNN Business.
Both HSBC and Independent Bank have also reportedly denied any wrongdoing in connection with the Ponzi scheme.
In another case involving an alleged Ponzi scheme, PNC Bank requested to get out a complaint in November 2022 that accused it of aiding and abetting a $3 billion Ponzi scheme allegedly orchestrated by TelexFree.
Have you been defrauded by a Ponzi scheme? Let us know in the comments!
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2 thoughts onTD Bank settles Stanford Ponzi scheme lawsuit for $1.2 billion
They have given me essesive over draft fee for years.
This is unbelievable TD many times over check individuals that one make a simple transaction ( like depositing 200 dollars in a visa friend) and being a customer for a long long long time and one is the subject of scrutiny. Or one has a cheque eof a son and being td customer for 50 years again one is looked at a possible fraud. And here come these institutions and millions of dollars are being defrauded. I think these new TD bankers are not really trained