‘Chinese money laundering networks are global and pervasive, and they must be dismantled,’ says a Treasury official.
The U.S. Treasury Department revealed in an Aug. 28 advisory the scope of Chinese money laundering networks’ pivotal role in the fentanyl crisis and the harm they have caused the United States.
Banks are required by law to report suspicious activity indicative of money laundering. Reports between January 2020 and December 2024 show approximately $312 billion linked to suspected Chinese money laundering activity, according to the Treasury’s Financial Crimes Enforcement Network (FinCEN).
These networks, run by Chinese nationals, are preferred by major cartels, including the Mexico-based Jalisco and Sinaloa cartels, due to their speed, effectiveness, and willingness to absorb financial losses or assume risks on behalf of the cartels, according to the FinCEN report.
The cartels, many of which have been designated terrorist organizations, control “nearly all illegal traffic across the southwest border,” to which the launderers contribute in a “vital” way, according to the report.
“Money laundering networks linked to individual passport holders from the People’s Republic of China enable cartels to poison Americans with fentanyl, conduct human trafficking, and wreak havoc among communities across our great nation,” John Hurley, the Treasury’s undersecretary for terrorism and financial intelligence, said in a statement.
Communist China is already considered a key contributor to the fentanyl crisis because the majority of chemicals used to assemble illicit fentanyl are known to originate from Chinese chemical companies.
According to FinCEN, the primary goal of these networks is to acquire large quantities of U.S. dollars and other currencies. FinCEN released a trend report on Chinese money laundering networks earlier this month that outlines ties to other crimes unrelated to fentanyl trafficking, such as health care fraud and illicit gambling activity.
Both Mexico and China have laws that restrict citizens from depositing large amounts of U.S. currency; thus, cartels and Chinese citizens seeking to circumvent the Chinese regime’s currency reporting requirements have turned to laundering networks, according to the report.
“Chinese money laundering networks are global and pervasive, and they must be dismantled,” said FinCEN Director Andrea Gacki.
