TD Bank shares down amid damaging allegations

TD Bank shares sank on Friday as the company defended itself

TORONTO — TD Bank shares sank on Friday as the company defended itself against reports quoting unnamed employees who alleged they broke the law in order to meet sales targets and keep their jobs.

A CBC story published earlier this week said three of the bank’s employees reported feeling pressured to sign up customers for products and services they don’t need in order to boost profits.

In a followup story on Friday, CBC reported that hundreds of current and former employees at the bank wrote to the broadcaster, with some alleging they broke the law in order to earn points towards sales targets they are required to meet in order to stay employed.

TD Bank (TSX:TD) denied the reports, saying in a statement that it takes ethics and integrity seriously and that the environment described in the report is “at odds” with how it runs its business.

TD’s shares lost 5.55 per cent, or $3.88, finishing the day at $66.00.

Barclays analyst John Aiken said investors are concerned the fallout could be similar to what happened at Wells Fargo last year.

The U.S. bank paid large penalties and issued an apology after regulators said its employees opened millions of unauthorized accounts and credit cards.

“There is very little that TD itself can do in the near term to disprove the allegations and the full overhang is not likely to dissipate until a full investigation is concluded, which could take months,” Aiken said in a note to clients.

TD said in a statement that its code of ethics instructs employees not to put business results before the interests of clients.

“While we believe that having metrics and goals helps us to manage our business, we also believe that we will only achieve our goals by doing the right thing for our customers,” the company said.

TD also said that it has an anonymous whistleblower hotline where employees and customers can raise concerns, and that all reports are investigated.

“We also strive to make sure employees feel empowered to escalate any concerns about unethical practices to their manager’s manager,” spokeswoman Daria Hill said in a statement.

Ratings agency DBRS said it doesn’t expect any rating changes for TD, but that it will be monitoring the situation and how severe any damage to the bank’s reputation will be.

“Given its relatively high rating level and the importance of the Canadian retail-banking sector to TD, DBRS has limited tolerance for any adverse impact to TD’s franchise strength and/or earnings power, both of which are key underpinnings of the Bank’s credit profile and overall credit ratings,” DBRS said in a statement.

The ratings agency said it also expects regulators to review sales practices, whistleblower procedures and incentive compensation at all Canadian banks.

Just Posted

Thousands expected at memorial for fallen police officer in Abbotsford, B.C.

ABBOTSFORD, B.C. — The streets of Abbotsford, B.C., will be lined with… Continue reading

One person dead, five others injured in early-morning crash in Kingston, Ont.

KINGSTON, Ont. — A man who was checking the damage on his… Continue reading

Gus is a special, collaborative art exhibit inspired by motherhood

The portrait display by mother and son is showing in Red Deer

Robotics challenge sparks student interest in Red Deer

Student-built robots compete in fun challenge

Accused murderer tells all to Mr. Big undercover officer

Joshua Frank tells undercover police officer he shot the Klaus family

WATCH: Central Middle School students’ Christmas tree

A group of Central Middle School students are set to show off… Continue reading

Chicken crosses B.C. road, stops traffic

Rooster makes early morning commuters wait in Maple Ridge

Red Deerian honours her brother who died in a motorcycle collision

Houaida Haddad is encouraging Red Deer residents to donate blood

Red Deer County firefighters to be recognized for Waterton help

RCMP brass will give formal recognition Monday

Ron James tries to lighten humanity’s load through humour

The comedian returns to Red Deer for shows Dec. 1 and 2

100+ Women Red Deer donate to Christmas Bureau

About $14,000 will help with Christmas hampers and toys

Semi collides with vehicle on Highway 2 north of Ponoka

Members of the Ponoka Integrated Traffic Unit dealt with a call on Highway 2 north of Ponoka

After 70 years, Red Deer veteran still remembers his traumatic war experience

Frank Krepps feels lucky to have survived the Second World War

Merritt Mountie charged with assault

Charges are in relation to an incident in May at the detachment, B.C. Prosecution Service said

Most Read

Five-day delivery plus unlimited digital access for $185 for 260 issues (must live in delivery area to qualify) Unlimited Digital Access 99 cents for the first four weeks and then only $15 per month Five-day delivery plus unlimited digital access for $15 a month