Men Plead Guilty to Laundering Millions in Fentanyl and Cartel Money
The Mexican Army carried out a seizure of methamphetamines and fentanyl in a clandestine laboratory located in the Sinaloa highlands in January 2024. Photo credit: parrazurita / Shutterstock.com.
Chen and Tan also agreed to forfeit over $23 million, as well as property, including body armor, a residence and a firearm, according to the terms of the plea agreement.
Mexico, China and U.S. Drug Trade
The drug trade between Mexico, the U.S. and China is extensive and complicated and involves multiple people, organizations and currencies, according to the affidavit. The majority of street drugs sold in the U.S. are made in other countries and shipped here. The profits from the narcotics are in USD currency, which is in demand in China. Chinese currency is, in turn, in demand in Latin American countries, including Mexico.
The Sinaloa Cartel, an organization based in Sinaloa, Mexico, was charged by the DOJ on April 14, 2023, for trafficking fentanyl, and the Cartel Jalisco Nueva Generacion (Jalisco Cartel), which is based out of the State of Jalisco in Mexico, were both named in the affidavit for their part in the scheme.
Chen and Tan worked as part of an organization that laundered the proceeds of cocaine and fentanyl sales within the United States, according to the DOJ press release. Their job was to travel around the U.S. and collect the U.S. currency in cash made from the traffic and sale of fentanyl, cocaine, and other drugs, then work with co-conspirators in China and other countries to move the funds by making bulk merchandise purchases in the U.S. and shipping them to China where they would be sold for the equivalent price.
The Latin American merchants then hired “brokers” who could use Chinese currency to purchase Chinese merchandise and ship it to the Latin American merchants, who then sold the goods for profit, according to the affidavit. The brokers were then compensated for their part in the scheme.
Previous Enforcement Actions
Chen was arrested on April 18, and Tan was arrested on May 22, according to a DOJ press release. But they haven’t been the only ones.
The DOJ announced an increase in enforcement actions against the Sinaloa Cartel on April 14, 2023, naming them as perpetrators in America’s fentanyl crisis that killed 74,702 people in 2023, according to a CDC report.
In July, the DOJ arrested alleged Sinaloa Cartel co-founder Ismael Zambada Garcia, a.k.a. “El Mayo,” and Joaquin Guzman Lopez, the son of the other alleged co-founder, on July 25, in El Paso, Texas, according to a July DOJ press release.
On Sept. 20, Jalisco Cartel’s second-in-command, Ruben Oseguera-Gonzalez, a.k.a. El Menchito, was convicted of conspiring to distribute five kilograms of cocaine and 500 grams of methamphetamine in the U.S., according to his DOJ press release.
Chen’s sentencing is scheduled for Nov. 14, and Tan’s is scheduled for Feb. 7, 2025. They each face a maximum of 20 years in prison.
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