Illicit Trade Director Channing Mavrellis of Global Financial Integrity (GFI), in a recent interview with The Federal Newswire, said Chinese money laundering operations have been detected by the U.S. Treasury since 2016.
“The Chinese money laundering organizations were also guaranteeing that if anything happens to the cash [they] will replace it. It's a business model that's really hard to beat,” Mavrellis said in the interview. “They came onto the scene and they've just been really popular. You see Colombian cartels looking toward them.”
Mavrellis added, “There's this symbiotic relationship now between Chinese money laundering organizations and the cartels. The cartels have cash. They want to get rid of it, they want to launder it, and you have Chinese nationals looking for U.S. currency.”
According to the Federal Newswire report, the Chinese laundering organizations are using two illegal methods.
“Fei Chien” [Flying Monet] is in informal value transfer and the second is Chinese underground banking known as Mirror Exchange or exchange transactions," the report said.
Mavrellis said the new relationship with the Chinese has increased efficiency for the cartel business.
“The cartels or any kind of criminal organization, get their proceeds back much quicker,” Marvellis said. “There is a much lower chance of losing value or money getting seized. Your cost of doing business is much better.”
According to an opinion piece by Christopher Urban in The Hill in August 2022, Chinese organized crime has taken over the money laundering operations for the Mexican cartels, which makes it more efficient for transferring drug money to Mexico.
“This has increased net profits for the cartels and empowered them to expand their operations,” Urban wrote.
According to the Federal Newswire, Mavrellis said that based on the type of surveillance the Chinese Communist Party (CCP) has access to, she believes it is aware of what is going on with the money laundering platforms.
“I 100% believe there could be more done by the Chinese government in terms of monitoring these platforms,” she said.
According to the Select Committee on the CCP’s Twitter account, DEA Administrator Anne Milgram said on "PBS News Hour" that Chinese companies have recently been charged on account of their relation to the fentanyl crisis.
Milgram said, “For the first time ever, we have charged four PRC companies with fentanyl trafficking conspiracy. We have also charged eight PRC nationals who work for those companies, and we have taken 2 of them into custody.”
GFI focuses the convergence of illicit financial flows and international crimes, according to the group's website.
The website said Mavrellis has many years of experience in anti-money laundering and specializes in illicit trade and trade-related illicit financial flows. She offers policy advice and training to government officials, addressing customs fraud and environmental crimes associated with illicit trade.
