The U.S. Department of the Treasury announced on Monday (July 1) sanctions against three individuals from Mexico and China for their alleged involvement in money laundering, transferring the drug trafficking profits of the Sinaloa Cartel in the U.S. to foreign countries, including Mexico.
This action, as stated in a press release, is the result of ongoing efforts by the U.S. government in collaboration with the Mexican government aimed at “disrupting the illegal financial networks relied upon by drug trafficking organizations,” preventing fentanyl trafficking, and saving lives.
The U.S. Treasury Department pointed out that the Chinese Money Laundering Organization (CMLO) has rapidly become one of the most prominent money laundering threats to the U.S. financial system, operating actively in the U.S. and globally. They have been helping to transfer the drug trafficking profits in the U.S. to locations such as Mexico through complex networks, also providing U.S. dollars to Chinese nationals seeking to circumvent currency controls imposed by the Chinese government.
Diego Acosta Ovalle, residing in Mexico, was accused of concealing and collecting drug trafficking profits and then passing them on to his associates within the trafficking organization. These associates in turn collaborated with Tong Peiji and He Jiaxuan, both members of the “Chinese Money Laundering Organization” (CMLO) residing in China.
Tong Peiji allegedly traveled to Mexico to meet with Sinaloa members to secure money laundering contracts. He also arranged for the purchase of encrypted cryptocurrency to be provided to Sinaloa accounts.
Tong Peiji and He Jiaxuan were responsible for reselling the drug proceeds to individuals in need of U.S. dollars. Following Tong Peiji’s instructions, He Jiaxuan collected a significant amount of currency from criminal groups and transferred the funds to other members of the CMLO.
Deputy Secretary of the Treasury Wally Adeyemo stated, “Combatting the threat posed by the Chinese Money Laundering Organization is a top priority for the Treasury Department. Today, we took action to disrupt the flow of funds for these major money launderers who assist in the trafficking of fentanyl and other illicit drugs into the U.S.”
Adeyemo emphasized, “This illicit drug trade claims the lives of thousands of Americans every year.”
The Treasury Department’s statement referred to Ovalle, Tong Peiji, and He Jiaxuan as “money laundering fugitives.” Previously, these designated individuals had been indicted by the U.S. Department of Justice. (Previously Reported: Investigation: Chinese Underground Banks Facilitate Money Laundering for Mexican Drug Cartels)