td bank
How a Canadian Bank Wants You to Forget They Avoid Taxes

If you are on social media you might have noticed a campaign by TD Bank called #TDThanksYou.

It is another example of a popular corporate advertising practice that goes like this:

  • organize a surprise event for a few customers,
  • videotape it
  • add some music
  • slap a syrupy hashtag on it
  • hope it goes viral and people think you are nice guys.

You’d have to have a heart of stone not to let it pull at your heart strings a little and they know it.

But wait. This is the same multinational that aggressively operates in tax havens.

In 2012 TD Bank made $6.5 billion in profit. But, because of overseas profits, it cut its tax rate to 15 per cent. That’s half the regular Canadian corporate tax rate which is already the lowest in the G7. In 2009 when the corporate tax rate was almost 32 per cent, TD paid only 7.6 per cent tax in Canada.

TD is not alone in this practice. The Royal Bank spends millions sponsoring events and donating to charities. But it too operates in tax havens all over the world. And resource giant Cameco uses the tag line “Cameco Cares” - contributing to children’s hospitals and organizing summer concerts. But behind that feel-good generosity, Cameco has avoided more than a billion dollars in taxes through its use of a Swiss tax haven. […]
TD Bank CEO Got 10% Raise After Layoffs
The bank issued its management proxy circular on Tuesday, showing that Masrani was paid $9 million in total compensation.

TD Bank CEO Bharat Masrani was given a 10 per cent pay bump in 2015, a year when the bank laid off staff as part of a company-wide effort to trim costs.

The bank issued its management proxy circular on Tuesday, showing that Masrani was paid $9 million in total compensation.

The document says the bank’s board of directors set that pay on a recommendation from its human resources committee, which considered a number of factors, including TD’s performance against other banks.

Cost management has been top of mind for Canada’s big banks amid concerns about slowing loan growth, weak oil prices and low interest rates.

Last October, TD confirmed reports it was eliminating jobs after a review, but it declined to say how many.

There have been reports from various media sources that several hundred employees were let go.

The bank is scheduled to release its first quarter results on Thursday.

Masrani was appointed CEO on Nov. 1, 2014.

TD Bank and overdraft fees

Apparently TD Bank decided it’s okay to hit customers with overdraft fees without regard to whether there is an actual overdraft.1 Or whether the account balance ever goes close to zero.

It’s no surprise that a bank would reorder transactions to reap extra fees–but this one is a new one. Here’s how it seems to work.

  1. Your account has $800 in it to begin with.
  2. You deposit a check for $2,000. This triggers an automatic hold for all but the first $100.
  3. TD structures this hold as a $2,000 deposit and a (presumably temporary) $1,900 debit.
  4. TD orders these transactions so the debit goes first. So for a moment your account is $1,100 overdrawn.
  5. You are then charged a $35 overdraft fee because your account dipped below zero.2

On the upside, if you don’t mind waiting on hold for a while TD has lovely customer service reps available at all hours. The representative was, of course, unable to determine why the fee had been assessed. I was told the fee would be reversed as a “one time courtesy.” Then I was given advice on how to avoid “overdrawing my account in the future.” I was not amused.

How many people wouldn’t have challenged the bogus fee? Is this negligence or something more deliberate?

  1. When making appropriately tagged posts about large companies on the Internet, I assume there’s likely a social media intern or something who reads it. If TD Bank tells me that I’ve gotten something wrong, I will promptly update this post here. Or retract it or something if I got it really wrong. But I did my diligence on this one. 

  2. Edit: I’m sort of a stickler for accuracy if I’m going to go making accusations of potentially criminal behavior–so I wanted to update this post because I think something (very) slightly different happens. It looks like all check-related deposits are processed simultaneously. See, e.g.. But they are reordered. So if you’d written three checks for $25 in addition to making your deposit, you could be assessed with three overdraft fees for each of the three checks, which could somehow be processed between the $1,900 hold and the $2,000 deposit. But you would not be charged a fee on the $1,900 hold.