(Toronto) RBC and TD Bank Group have agreed to pay tens of millions of dollars in penalties after being charged by the U.S. Securities and Exchange Commission (SEC) with record-keeping violations.
RBC Capital Markets has agreed to pay US$45 million. Various TD divisions, including the recently acquired TD Cowen, have agreed to pay a total penalty of US$46.5 million to the SEC, in addition to US$82 million to the U.S. Commodity Futures Trading Commission (CFTC).
The two banks are among 26 financial institutions that the SEC said have agreed to pay a total of $393 million while implementing improvements to their compliance policies.
The payments relate to the use of electronic communications via text messages and other alternative channels that were not maintained as required by the SEC.
The regulator said it found “pervasive” levels of off-channel communications at both banks, both between employees and with customers.
RBC said in a statement that it was pleased to have resolved the issue and remained focused on meeting all regulatory requirements. TD Bank Group said it has fully cooperated with regulators and has strengthened its policies and procedures around electronic communications.
The sanctions are part of a broader effort to enforce U.S. regulators’ controls on communications practices that has resulted in more than $1.2 billion in penalties, including past payments by Scotiabank and Bank of Montreal.