Elizabeth Warren, D-Mass., calls on the Office of the Comptroller of the Currency to reject Toronto-Dominion Bank’s $13.4 billion acquisition of First Horizon, citing concerns about customer abuse.
one inside letter Co-signed by Rep. Katie Porter, D-California, Al Green, D-Texas, and Jesus Garcia, D-Ill., Warren cited a Capital Forum report noting that TD used employee incentives similar to the fake ones Accounts contributed to fraud at Wells Fargo.
According to the letter, the Canadian bank used a points system that encouraged employees to “push increasing numbers of customers into overdraft protection to compensate employees for lost bonuses or even when targets were not met.” When that’s done, they’ll be threatened with dismissal.” According to the letter, TD employees will report account fraud or “hypothetical problems” to encourage consumers to open more accounts.
“The Biden administration has previously stated its intention to review the rules governing large bank mergers,” Sen. Elizabeth Warren, D-Mass., wrote in her letter to Acting Comptroller Michael Hsu, “and you’ve put that first . called for public participation in the process.”
Capital Forum reported that after the OCC disclosed the wrongdoing in 2017, then-Chief Auditor Keith Norica chose to privately reprimand TD rather than impose fines or publicly announce the findings. Democratic lawmakers noted in their letter that Norica represented TD as attorney before and after his tenure as Comptroller.
As of May, TD employees claimed the problems were ongoing, Capital Forum reported.
TD called the report’s findings “unfounded” in a statement on Tuesday. The bank said it “never encountered any problems with the systemic sales practice.”
“Our compensation practices – which place a strong emphasis on customer satisfaction – are carefully and proactively managed. We strongly disagree with any allegation of systemic issues with the sales practice or any other allegation mentioned in the article, the bank said.
TD also said it “strongly disagrees” with “the article’s characterization of the information presented as facts about TD Bank’s fraudulent processes.”
“At TD Bank, the security of our customers’ accounts and personal information is a top priority,” the bank said in a statement. “We follow industry best practices designed to help detect and prevent fraud.”
Warren, in his letter to Comptroller Michael Sue, asked the OCC to release the findings of its 2017 investigation. letter was said earlier from CNBC.
“The OCC’s decision under Mr. Norika did not allow TD Bank to punish large-scale fraud and abuse, even after the agency’s disturbing findings in the bank’s own investigations undermine the OCC’s authority and have the potential to jeopardize consumer finances.” Warren wrote.
TD’s deal to acquire Memphis, Tennessee-based First Horizon create The six largest banks in the United States by assets. This comes at a time when banking regulators, particularly the OCC, have done so To express Concerns about merger of regional banks
In his letter, Warren pointed to growing skepticism in Washington about big bank M&A deals.
“The Biden administration has previously stated its intention to review the rules governing large bank mergers,” Warren wrote in his letter to Hsu, “and you have previously called for further public participation in this process.”