The U.S. Treasury Department is sounding the alarm on sprawling Chinese money laundering networks that officials say are moving hundreds of billions of dollars through the American financial system, bankrolling drug cartels, human trafficking, and real estate purchases.
In an advisory released Thursday, the Financial Crimes Enforcement Network (FinCEN) said it identified roughly $312 billion in suspicious transactions linked to Chinese money laundering networks, or CMLNs, between January 2020 and December 2024. The analysis covered more than 137,000 reports filed under the Bank Secrecy Act by U.S. financial institutions.
“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,” Under Secretary for Terrorism and Financial Intelligence John K. Hurley said in a statement.
The stunning FinCEN alert comes as Maine continues to struggle against Asian Transnational Criminal Organizations — aka the Chinese mafia — that have developed deep and systemic networks within rural Maine to cultivate and traffick black-market cannabis.
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FinCEN Director Andrea Gacki called the networks “global and pervasive,” adding that they must be dismantled.
“These networks launder proceeds for Mexico-based drug cartels and are involved in other significant, underground money movement schemes within the United States and around the world,” Gacki said.
The Treasury report said the laundering operations exploit gaps created by laws in both Mexico and China. Mexico limits the amount of U.S. dollars that can be deposited in its banks, while China imposes strict annual caps on the money its citizens can transfer abroad. CMLNs step into that void, buying drug dollars from cartels in the U.S. and selling them to Chinese nationals desperate to move wealth overseas.
The impetus for wealthy Chinese individuals to move their money into the U.S. stems from the Chinese Communist Party’s penchant for seizing the assets of Chinese subjects who amass more wealth than the cult-like dictatorship can tolerate.
The Chinese money laundering networks are hardly limited to narcotics. FinCEN said it reviewed 1,675 suspicious activity reports tied to human trafficking and smuggling, 43 reports involving $766 million at adult and senior day care centers in New York, and more than 17,000 reports involving $53.7 billion in potentially illicit real estate deals. Some involved shell companies, layered transactions, and money mules using counterfeit passports.
The advisory warns banks and other institutions to be alert for red flags — including accounts opened by individuals listing occupations such as “student,” “housewife,” or “retired” but suddenly moving large sums. FinCEN also flagged risks across casinos, insurance, mortgage brokers, and the precious metals trade.
The release underscores mounting U.S. concern that Chinese underground banking systems are becoming indispensable partners for Mexican cartels, allowing both sides to profit from the deadly fentanyl pipeline while also embedding illicit cash into the U.S. economy.
The FinCEN advisory relates directly to Maine, where Chinese individuals claiming to come from New York have built a veritable cannabis empire. Banking institutions and other businesses that conduct commerce with these individuals may be unknowingly placing themselves in FinCEN’s cross-hairs.
