OSC approves $10.1M settlement with TD over currency traders sharing info
TD Bank agreed their currency traders exchanged confidential information with traders at other financial institutions between 2011 and 2013
TORONTO – A panel at the Ontario Securities Commission has approved a $10.1-million settlement agreement with Toronto-Dominion Bank on Friday after the lender’s currency traders shared confidential information in chatrooms to gain a potential advantage in foreign exchange transactions.
TD Bank will make a voluntary payment of $9,300,900 to the securities regulator and an additional payment of $800,000 to cover the costs of the OSC’s investigation.
TD’s internal audit group will also conduct an audit of its compliance with the FX global code, a set of principles for the foreign exchange market.
As part of the settlement, TD Bank agreed that their currency traders exchanged confidential information, such as the existence of stop loss orders, with traders at other financial institutions over a period between 2011 and 2013.
TD also agreed that it did not have a sufficient system of controls and supervision in place in relation to its foreign exchange business during that time.
OSC commissioner Grant Vingoe said during the hearing that TD failed to meet the high standard of conduct expected of a market participant and that potentially put its customers at risk.
Vingoe added that the Toronto-based lender has shown “exemplary” co-operation with the commission in its investigation, including providing large amounts of data.
He said factors in the commission’s decision to approve the settlement included that since the period in question, TD Bank has significantly remediated its compliance and procedures and instituted relevant training programs.
Royal Bank is also seeking a settlement in connection with similar allegations with the OSC in a hearing scheduled Friday in Toronto.