(Toronto) BMO Financial Group announced that it has successfully overturned a 2022 jury verdict against the bank in a U.S. pyramid scheme trial.
The Canadian bank said the U.S. Court of Appeals for the Eighth Circuit had also asked the court to enter a judgment in favor of BMO’s U.S. subsidiary.
Following the decision, BMO said it plans to reverse a $1.19 billion provision, a move it said will result in an after-tax recovery of $875 million in its fourth quarter.
The plaintiffs in that case alleged that Marshall & Ilsley Bank, which BMO bought in 2011, was complicit in fraud perpetrated by Thomas J. Petters and others.
They alleged the bank served as a “key hub” for Petters, who had a checking account at the bank that was used to launder money.
Petters was convicted in 2009 of masterminding the scam and sentenced to 50 years in prison.