On Thursday, May 1st, Federal prosecutors in the Western District of North Carolina in the United States announced that three members of the “Chinese Money Laundering Organization” (CMLO) have pleaded guilty to money laundering charges related to drug trafficking profits, where the organization laundered over $92 million of illegal funds.
In a statement, Federal prosecutor Russ Ferguson said, “This case should serve as a warning to foreign money launderers and drug traffickers. We will work tirelessly to dismantle criminal networks that use our sound financial system to fund crime, fuel addiction in our communities, and spread violence on our streets.”
According to court documents, the three Chinese individuals who pleaded guilty are core members of CMLO. Among them, 29-year-old Maoxuan Xia, 42-year-old Zhou Yu, both from China, and 58-year-old Shao Neng Lin from California.
The organization laundered over $92 million of illegal funds, primarily proceeds from illegal drugs trafficked into the United States through Mexico and distributed within the country.
Maoxuan Xia, one of the most active members of the organization, frequently traveled across the United States to collect drug trafficking proceeds from American drug dealers. He used legitimate and forged identities to deposit these illegal funds into shell company bank accounts registered by other CMLO members like Lin and Yu.
Maoxuan Xia and Zhou Yu each pleaded guilty to one count of money laundering conspiracy, one count of money laundering (to conceal the nature, location, source, ownership, and control of illegal proceeds), and one count of currency transaction involving criminally derived property exceeding $10,000. Shao Neng Lin pleaded guilty to one count of money laundering conspiracy, two counts of money laundering, and two counts of currency transaction involving criminally derived property exceeding $10,000.
Under the plea agreement, Maoxuan Xia admitted to laundering over $30 million in less than two years, knowing the funds were related to drug sales. Shao Neng Lin and Zhou Yu admitted to each receiving approximately $20 million of illegal funds through shell company accounts, collectively laundering around $40 million.
Each defendant faces a maximum of 20 years in prison for each money laundering conspiracy and money laundering charge, and up to 10 years for each currency transaction charge. The sentencing for each of them will be determined by a Federal District Court judge considering the U.S. Sentencing Guidelines and other statutory factors.
This case is part of the U.S. Department of Justice’s “Operation Take Back America,” a nationwide initiative aimed at mobilizing all resources to combat illegal immigration, dismantle drug trafficking groups and transnational criminal organizations, and protect communities from violent crime.
The investigation was conducted jointly by the Drug Enforcement Administration (DEA) and the Internal Revenue Service Criminal Investigation (IRS-CI), along with the Department of Justice’s Narcotic and Dangerous Drug Section (NDDS) and the Federal Prosecutor’s Office in the Western District of North Carolina.