In a major breakthrough in a crackdown against Chinese money laundering networks working with Mexican drug cartels, US prosecutors announced charges against 24 people for allegedly taking part in a scheme to launder more than $50 million in drugs. Federal agencies are targeting the highest levels of Chinese money laundering rings, which are the go-to partners for Mexico’s most dangerous drug cartels trafficking fentanyl, cocaine, and methamphetamine into the US. Two fugitives named in the indictment unsealed in California have been arrested – one by the Chinese government and the other by the Mexican government, according to the Drug Enforcement Administration (DEA).
This rare breakthrough in US law enforcement collaboration with China and Mexico has led to the arrest of an array of Chinese, Mexican, and American men allegedly working as couriers, money brokers, and traffickers in an elaborate scheme to launder money for the Sinaloa Cartel. The operation also seized ten thousand fake fentanyl pills. “These Chinese criminal money laundering networks can move money faster, cheaper, and at a fraction of what is usually charged,” said DEA Administrator Anne Milgram at a press conference.
Recent federal indictments reveal an intense effort by DEA, IRS, and other agencies to investigate and surveil Chinese money launderers across more than a dozen states. According to a senior DEA official, the agency has seen an uptick in Chinese money laundering activity in the US. Don Im, a former DEA official, noted that Chinese money laundering groups have undercut competitors by tapping into the Chinese diaspora in the US and Latin America.
Fentanyl, a synthetic opioid, has been a driving force in a surge of deadly drug overdoses in the US. The Biden administration is searching for tools to cut off fentanyl supplies and financing. Federal agents continue to seize tons of fentanyl and other drugs at the southern border, but there is also a focus on targeting the cartels’ cash. Despite the growing use of cryptocurrency in the drug trade, substantial amounts of cash are still being laundered.
Federal agencies have announced new initiatives to track down and thwart Chinese money launderers working for the cartels. The Treasury Department is using IRS agents and banking data to identify these individuals. Homeland Security Investigations set up a unit to share intelligence related to Chinese money laundering, and the DEA has created a team focused on illicit finance. While there are concerns about effective coordination among federal agencies in combatting money laundering, the initiatives are showing promise in targeting the cartels’ financial networks.
