10:41 AM EDT, 05/03/2024 (MT Newswires) -- (Updates with comments from Toronto-Dominion Bank's ( MLWIQXX ) spokesperson in fifth and sixth paragraphs.)

The US Department of Justice investigation into Toronto-Dominion Bank's ( MLWIQXX ) internal controls is focused on how Chinese drug traffickers used the company to launder US fentanyl sales revenue, The Wall Street Journal reported late Thursday.

The probe started after agents uncovered an operation in New York and New Jersey that laundered proceeds from illegal drug sales via TD and other banks, the report said, quoting court documents and unnamed sources familiar with the situation.

The WSJ said that TD disclosed a DOJ probe into its anti-money-laundering practices last year but that the focus on money laundering linked to illegal drug deals hasn't been previously reported.

TD said Tuesday that in addition to the DOJ investigation, it's also under scrutiny in three other anti-money-laundering probes in the US, the WSJ reported.

A TD spokesperson told MT Newswires on Friday that "criminals constantly seek to use banks to launder money" and TD's US anti-money-laundering "program did not effectively thwart these activities."

"This is unacceptable, and we must and we will do better," the spokesperson said. "As previously disclosed, we have been and continue to cooperate with law enforcement and our regulators. A comprehensive effort is underway to strengthen our AML program, including investments in talent, tools and technology."

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)

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