By Nivedita Balu
TORONTO (Reuters) -TD Bank said on Thursday Chief Global Anti-Money Laundering Officer Herbert Mazariegos is stepping down immediately, as the bank takes remediation actions after it was fined by U.S. regulators for compliance failures.
Mazariegos joined TD in November 2023 from Bank of Montreal, where he served as the chief anti-money laundering officer for over four years. He was hired as part of TD's push to revamp its risk and compliance team.
Mazariegos, hired while outgoing CEO Bharat Masrani was in charge, will be replaced by Jacqueline Sanjuas, the head of U.S. financial crime risk management at TD, the bank said.
Toronto-based AML industry expert Sean Parker said TD cushioned the blow by hiring Sanjuas, who joined the bank in January 2024 and comes with two decades of experience in compliance and risk management.
Stephen Joyce, vice president of financial crime risk management transformation delivery and enablement, will take the role of interim head of financial crime risk management for TD's Canadian and international operations, excluding the U.S.
Joyce will report to Sanjuas.
"I am confident that these changes will position Financial Crime Risk Management for success," Chief Risk Officer Ajai Bambawale said in a memo to staff on Thursday, thanking Mazariegos for his "contributions ... during a challenging time."
Bambawale said in the memo Mazariegos' departure was based on mutual agreement.
TD faces an asset cap and a $3-billion penalty by U.S. regulators following a probe by U.S. agencies into the lender's anti-money laundering program that resulted in a rare quarterly loss and forced it to suspend its forecast.
The lender ran into problems with U.S. regulators for failures in its risk and compliance program that provided ground for a host of illicit activity, from fentanyl and narcotics trafficking to terrorist financing.
TD said last week that Masrani, who has taken full responsibility for the anti-money laundering failures, is stepping down in February, more than two months sooner than the previously planned date for his retirement.