Frank Spinosa, 53, faces 20 years in prison and a $1.25 million in fines, prosecutors said in a statement. He was released on a $250,000 bond on Friday and is due to be arraigned on Oct. 24.

Spinosa allegedly used his position at Canada's TD Bank to help attorney Scott Rothstein convince investors to buy stakes in what he said were settlements of potential lawsuits over sexual harassment or whistleblower claims.

Rothstein, who is serving a 50-year prison sentence after pleading guilty in 2010, told investors that plaintiffs agreed to sell their rights to a full settlement at a discount in exchange for an immediate lump sum.

"Rothstein and Spinosa would rely upon the prestige and legitimacy of TD Bank ... to give investors a false sense of security," according to the indictment.

Spinosa provided so-called "lock letters" that told investors that funds were held in special accounts from which only they could draw.

Rothstein used the money to fund a lavish lifestyle replete with high-end watches, sports cars, and multi-million dollar homes in Florida, New York and Massachusetts.

In July, a U.S. federal appeals court upheld a $67 million jury verdict against TD Bank filed by Texas-based Coquina Investments that invested in Rothstein.

TD Bank in 2013 agreed to pay $52.5 million to settle separate charges brought by U.S. financial regulators that it failed to report suspicious activity in accounts used by Rothstein. The bank did not admit or deny wrongdoing.

(Editing by David Adams and Sandra Maler)

By Zachary Fagenson