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The Treasury Department wants U.S. financial institutions to monitor for suspected Chinese money laundering networks handling funds that are used to fuel the flood of fentanyl across American communities
ByFATIMA HUSSEIN Associated Press
WASHINGTON — WASHINGTON (AP) — The Treasury Department wants U.S. financial institutions to monitor for suspected Chinese money laundering networks handling funds that are used to fuel the flood of fentanyl across American communities.
An advisory Thursday to banks, brokers and others highlights how such operations are working with Mexican drug cartels.
The Trump administration is calling on banks to flag certain customers who may fit a profile of people who could launder money for cartels. That could include Chinese nationals such as students, retirees and housewives with unexplained wealth, and those who refuse to provide information about the source of their money.
The Treasury contends that many of these people unknowingly work with cartels to bypass Chinese currency controls that restrict the renminbi exchange rate through a system limiting the annual foreign currency conversion for individuals, which is about $50,000.
It is not uncommon for Chinese individuals to evade such restrictions by turning to underground banks where their money is converted into foreign currencies, often U.S. dollars.
The Chinese Embassy in Washington had no immediate comment Thursday.
Also Thursday, the department’s Financial Crimes Enforcement Network, known as FinCen, released a report about how Chinese money laundering networks are expanding their ties beyond drug cartels. Financial institutions are increasingly filing suspicious activity reports on human trafficking and adult senior day care centers in New York that have become a vehicle for money laundering, according to the report.
FinCen analyzed more than 137,000 Bank Secrecy Act reports from January 2020 to December 2024 that accounted for approximately $312 billion in total suspicious activity.
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Last year, law enforcement officials uncovered a complex partnership between Mexico’s Sinaloa Cartel and Chinese underground banking groups in the United States that laundered money $50 million from the sale of fentanyl, cocaine and other drugs, federal prosecutors said.
The government’s instruction to banks to be more vigilant about Chinese students and other Chinese nationals comes as Republican President Donald Trump says he will allow 600,000 Chinese students into American universities.
“I hear so many stories about ‘We are not going to allow their students,’ but we are going to allow their students to come in. We are going to allow it. It’s very important — 600,000 students,” Trump said during a meeting with South Korean President Lee Jae Myung in the Oval Office on Monday.
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Associated Press writer Didi Tang contributed to this report.
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