TORONTO, Jan 23 (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 ( FNGB )

, 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.