The U.S. Department of the Treasury is intensifying efforts to crack down on global cartel financing, revealing that Chinese money laundering networks are working directly with Mexican drug cartels to move billions of dollars. The findings highlight a growing alliance between two of America’s most dangerous adversaries—China and the cartels fueling the fentanyl epidemic.
According to the Financial Crimes Enforcement Network (FinCEN), Treasury investigators analyzed 137,153 Bank Secrecy Act reports between 2020 and 2024. They identified $312 billion in suspicious transactions tied to Chinese laundering groups. Officials say these networks are now a key tool for cartels, exploiting both Mexican and Chinese currency laws to mask their operations.
Cartels face restrictions in Mexico on how many U.S. dollars can be deposited or transferred. Meanwhile, Beijing maintains strict controls on international cash transfers. To get around these laws, Chinese laundering groups purchase bulk U.S. dollars from cartels, then resell them to Chinese businesses and individuals looking to skirt China’s financial rules.
FinCEN warned that these laundering operations depend heavily on U.S.-based Chinese nationals to funnel cash into banks. These individuals—often students, retirees, or housewives—make suspiciously large deposits with no clear source of income, a red flag for financial institutions.
The revelation follows recent Treasury sanctions on two Mexican banks and a brokerage firm accused of helping cartels launder money and transfer funds to China for fentanyl precursor purchases. Officials believe the flow of cartel drug money into China plays a major role in sustaining the supply chain behind America’s fentanyl crisis.
Treasury officials urged banks to strengthen monitoring of cash transactions linked to Chinese nationals and report anomalies immediately. By targeting financial pipelines, the U.S. hopes to disrupt both cartel operations and China’s role in propping up the deadly drug trade.
