A proposed class-action lawsuit has been launched against TD Bank related to the ongoing investigations into the bank's anti-money-laundering program in the U.S.

The suit launched by Sotos Class Actions is on behalf of shareholders who bought TD shares between Aug. 26, 2021 and June 3, 2024. 

It alleges TD misrepresented systemic deficiencies in its anti-money-laundering controls which, after the deficiencies were disclosed, caused a significant drop in TD's stock price. 

TD has faced financial penalties in connection to the ongoing U.S. regulatory inquiry into its anti-money laundering compliance program, which it disclosed last year. 

In a statement, the bank said the allegations in the proposed class action are without merit and would be contested.

TD said its disclosures and public statements are and have been consistent with its obligations under securities law and its responsibilities to shareholders. 

This report by The Canadian Press was first published June 5, 2024.