May 2 (Reuters) - A U.S. Department of Justice (DoJ)

investigation into TD Bank is focused on how Chinese

drug traffickers and crime groups used the Canada's

second-largest lender to launder their money from fentanyl

sales, the Wall Street Journal reported on Thursday.

The bank disclosed last year that it was cooperating with

authorities in an investigation into its anti-money laundering

compliance program by the DoJ.

The investigation was initiated after agents uncovered an

operation in New York and New Jersey that laundered hundreds of

millions of dollars in proceeds from illicit narcotics through

TD and other banks, the WSJ reported, citing court documents and

people familiar with the matter.

TD Bank and the DoJ did not immediately respond to Reuters'

requests for comment.

Earlier on Thursday, Canada's anti-money laundering agency

imposed its biggest-ever penalty of nearly C$9.2 million ($6.71

million) on TD Bank over non-compliance of anti-money laundering

regulations.