U.S. banks moved $312B in cartel-linked Chinese cash
Though cryptocurrency is often blamed for enabling financial crime, especially by pro-banking lawmakers like Senator Elizabeth Warren, FinCEN’s latest findings suggest otherwise.
The Financial Crimes Enforcement Network (FinCEN) released data showing suspected Chinese money laundering networks moved $312 billion through U.S. financial institutions from January 2020 to December 2024. The figures come from 137,153 Bank Secrecy Act reports filed by banks and other financial firms.
Institutions filed 1,675 BSA reports indicating potential links to human trafficking or human smuggling. Another 43 reports flagged $766 million in suspicious activity at 83 adult and senior day care centers with New York addresses, pointing to possible healthcare fraud. FinCEN found 108 additional reports showing deposited funds potentially tied to healthcare fraud, elder abuse and suspicious gaming activity.
The networks use “mirror transactions” and other informal value-transfer methods: cartel USD value is swapped for pesos in Mexico while U.S.-based CMLNs sell those USD to Chinese clients; settlement occurs via RMB transfers inside China – often without cross-border wires.
FinCEN said Mexico's restrictions on dollar deposits and China's capital controls create demand for underground exchange services. Chinese money laundering networks fill that gap by connecting cartel dollars to Chinese customers who want to move money out of China.
The agency warned that these groups may recruit or place corrupt insiders at financial institutions to help open accounts and process transfers. Money mules often describe themselves as students, housewives or retirees when opening accounts, despite handling large unexplained transactions.
Real estate serves as a major channel for suspected money laundering. Financial institutions filed 17,389 reports covering more than $53.7 billion in suspicious real estate activity. The networks deploy shell companies or money mules to buy property, layer transactions and clean illegal proceeds. They often target high-value markets and take advantage of interest from Chinese investors.
FinCEN described the alignment between cartels needing to launder cash and Chinese clients wanting to bypass capital controls as "mutualistic." The agency said these factors have embedded the networks deeply in U.S. financial flows.
The advisory tells banks to watch for specific indicators of Chinese money laundering network activity when opening accounts or reviewing transactions. FinCEN emphasized mirror transactions and other informal value-transfer methods that often avoid cross-border wire transfers as a key element to monitor.
The networks use “mirror transactions” and other informal value-transfer methods: cartel USD value is swapped for pesos in Mexico while U.S.-based CMLNs sell those USD to Chinese clients; settlement occurs via RMB transfers inside China – often without cross-border wires.
FinCEN said Mexico's restrictions on dollar deposits and China's capital controls create demand for underground exchange services. Chinese money laundering networks fill that gap by connecting cartel dollars to Chinese customers who want to move money out of China.
The agency warned that these groups may recruit or place corrupt insiders at financial institutions to help open accounts and process transfers. Money mules often describe themselves as students, housewives or retirees when opening accounts, despite handling large unexplained transactions.
Real estate serves as a major channel for suspected money laundering. Financial institutions filed 17,389 reports covering more than $53.7 billion in suspicious real estate activity. The networks deploy shell companies or money mules to buy property, layer transactions and clean illegal proceeds. They often target high-value markets and take advantage of interest from Chinese investors.
FinCEN described the alignment between cartels needing to launder cash and Chinese clients wanting to bypass capital controls as "mutualistic." The agency said these factors have embedded the networks deeply in U.S. financial flows.
The advisory tells banks to watch for specific indicators of Chinese money laundering network activity when opening accounts or reviewing transactions. FinCEN emphasized mirror transactions and other informal value-transfer methods that often avoid cross-border wire transfers as a key element to monitor.
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