In an April 26 hearing titled “China in Our Backyard: How Chinese Money Laundering Organizations Enrich the Cartels," Rep. Lisa McClain (R-MI), chairwoman of the Health Care and Financial Services Subcommittee, outlined in her opening remarks how Chinese Money Laundering Organizations that help cartels hide their money also help them bring fentanyl into the U.S. She urged Congress to find out the extent to which the Chinese government is involved in these crimes. She thanked the people who came to the subcommittee to share their knowledge about how to stop and break up these Chinese networks that work with cartels.
"Illicit fentanyl presents one of the biggest, if not the biggest, threats to public safety that the United States has ever seen," McClain said. She said fentanyl is the deadliest drug for Americans between 18 and 45 years old. It kills more people in that age group than COVID-19, car crashes, or suicide.
In 2020, almost 2,800 people in Michigan died from drug overdoses, and approximately three quarters of them had fentanyl or similar drugs in their system, McClain said.
McClain said the fentanyl crisis has gotten worse because of President Biden’s policies that let more people cross the border. Cartels have used this opportunity to sneak deadly drugs into our country and our neighborhoods. A tiny amount of fentanyl can be fatal, McClain said.
"Looking to profit from this dangerous enterprise, criminal organizations based in the People’s Republic of China have captured the money laundering business for the cartels," McClain said. These Chinese groups have a very effective system that is hard for law enforcement to catch. Before Chinese Money Laundering Organizations got involved, cartels used the black-market peso exchange to launder their money and had to wait for a week or more to get their money back. Now, the Chinese organizations have a system that lets cartels get their money in a few hours after giving their dirty money to a messenger.
Chinese Money Laundering Organizations that help cartels hide their money do it faster, cheaper, and better than before, McClain said. This makes the cartels richer and more powerful, and Chinese groups have a smart system that avoids using the U.S. banking system. They use Chinese apps and technology, like WeChat, to move cartel money without being caught by U.S. law enforcement.
China is a major hub for money laundering, McClain said, citing a State Department estimate that $154 billion is laundered through China every year. She said Congress needs to find out the extent to which the Chinese government is involved in these crimes. Rich Chinese leaders are ignoring these laundering networks and China’s role in making illegal drugs, McClain said, adding that Americans are fed up with seeing their friends and family suffer from fentanyl and opioid addiction.
"As Members of Congress, we owe it to our constituents to do everything we can to eradicate this dangerous drug from our communities," McClain said in closing. "We must hold these bad actors accountable."
