The Globe and Mail reports in its Friday edition that TD Bank's now $3-billion (U.S.) provision for anticipated record U.S. regulatory penalties puts Canadian bank supervision in the international spotlight, and the look is not good. Guest columnist John Turley-Ewart writes that the U.S. case against TD claims that from 2016 to 2021, $653-million (U.S.) in illegal drug money was laundered through TD branches in three U.S. states. The failure here goes beyond TD. It points to ineffective supervision by Canada's bank regulator, the Office of the Superintendent of Financial Institutions, whose responsibility includes preventing this exact situation. OSFI's 2014 Guideline E-13 spells out the key controls a bank must have in place to manage regulatory compliance risk "in any jurisdiction in which it operates." This means OSFI must be satisfied that our banks operating subsidiaries in countries such as the U.S. have the required and effective controls to comply with U.S. regulations. Canada's bank supervisor misread the risk associated with money laundering that Canadian banks face in the U.S., and how at risk TD was. If OSFI had understood that risk years ago and took action, TD would most likely be in a better spot today.