Federal authorities say a five-year investigation uncovered a complex scheme between one of Mexico’s most notorious drug cartels and Chinese nationals living in the United States to launder millions of dollars from illegal drug sales.
The U.S. Department of Justice on Tuesday announced a 10-count indictment alleging that Los Angeles-based members of Mexico’s Sinaloa drug cartel conspired with a money-laundering ring with ties to an underground Chinese bank to launder drug trafficking proceeds.
Officials said more than $50 million in drug proceeds flowed between Sinaloa Cartel figures and Chinese black market operators during the conspiracy.
A years-long investigation into the conspiracy, dubbed “Operation Fortune Runner,” resulted in 10 indictments naming 24 people for suspected money laundering.
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This undated photo provided by the U.S. District Attorney’s Office shows seized drugs being stacked in the back of a truck. The Department of Justice today announced a 10-count indictment alleging that Los Angeles-based members of Mexico’s Sinaloa drug cartel conspired with a money laundering ring with ties to Chinese underground banks to launder drug trafficking proceeds. (U.S. District Attorney, via The Associated Press)
The charges include conspiracy to facilitate the distribution of cocaine and methamphetamine, conspiracy to launder financial instruments and conspiracy to operate an unlicensed money transmitting business.
According to the indictment, a money laundering network with ties to the Sinaloa Cartel, based in California’s San Gabriel Valley and with the assistance of a money transmission group with ties to underground Chinese banks, collected and processed large amounts of drug proceeds in U.S. dollars in the Los Angeles area.
The group then allegedly concealed drug trafficking proceeds and made the profits earned in the United States available to cartel members in Mexico and elsewhere.
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Prosecutors said in a news release that members of the powerful Sinaloa drug cartel conspired with Chinese-origin groups to conceal more than $50 million in drug trafficking profits, much of which was processed in the Los Angeles area. (U.S. District Attorney, via The Associated Press)
The principal suspect, Edgar Joel Martinez Reyes, 45, of East Los Angeles, and others are accused of concealing the source of their funds using a variety of methods, including transaction-based money laundering, “structuring” assets to avoid federal financial reporting requirements, and purchasing cryptocurrencies.
“Dangerous drugs like fentanyl and methamphetamine are destroying lives, but drug traffickers only care about profit,” said United States Attorney Martin Estrada for the Central District of California. “Therefore, pursuing sophisticated international criminal organizations that launder drug money is essential to protecting our communities. As this indictment and our international actions demonstrate, we will go after all those who facilitate this destruction domestically and ensure they are held accountable for their actions.”
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The Department of Justice announced 10 additional indictments alleging that Los Angeles-based members of Mexico’s Sinaloa drug cartel conspired with a money laundering ring with ties to Chinese underground banks to launder drug trafficking proceeds. (U.S. Drug Enforcement Administration)
The 20 people charged in the indictment, including one indicted Monday, are expected to be arraigned in U.S. District Court in downtown Los Angeles in the coming weeks.
“Relentless greed and the pursuit of money are what drive the Mexican drug cartels, who have unleashed the worst drug crisis in American history. This DEA investigation has uncovered partnerships between Sinaloa Cartel associates and Chinese criminal organizations operating in Los Angeles and China to launder drug money that provides the Sinaloa Cartel with the means to manufacture and import deadly toxins into the United States. DEA’s number one operational priority is saving American lives by taking down the cartels and those who support their operations. This investigation is the latest example, and more will follow.” – DEA Administrator Anne Milgram
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As part of the investigation, law enforcement seized approximately $5 million in drug proceeds, 302 pounds of cocaine, 92 pounds of methamphetamine, 3,000 ecstasy pills, 44 pounds of psilocybin (magic mushrooms), several ounces of ketamine, three semi-automatic rifles with high-capacity magazines, and eight semi-automatic handguns.
