Former DEA Agent Reveals Chinese Criminal Networks' Impact on U.S. Drug Trade

For much of his career as a federal drug agent, Ray Donovan was focused on capturing Mexican cartel boss Joaquin “El Chapo” Guzman. When Guzman was arrested in early 2014, Donovan turned his attention to the rising fentanyl trafficking in the U.S.

Donovan enlisted a data scientist to map out fentanyl networks on the East Coast. Reviewing telephone records of suspected traffickers, investigators noticed a shocking pattern. “A ton of calls to China,” recalled DEA agent Michael Mezner. “I looked at that data from every way, and I went to the data guy and told him, ‘I don’t know what’s going on here, but I’ve never seen anything like this in my life.’”

Chinese criminal groups were laundering drug money for Mexican cartels on an unprecedented scale. In 2015, Donovan's focus shifted back to El Chapo after his prison escape. By the time Guzman was recaptured a year later, investigators had discovered that Chinese brokers laundering fentanyl proceeds were also heavily involved in marijuana trafficking across the U.S. “That was an eye-opening moment,” said Donovan.

This revelation has significant national security implications. Over the past decade, Chinese organized crime groups have become the dominant money launderers for Mexican cartels, using the profits to take over the illicit marijuana trade. “It’s two revenue streams that no one else can compete with,” said Christopher Urben, a former DEA assistant special agent. “They’ve created within the United States, I hate to say it, this super cartel organized crime force.”

Chinese syndicates' involvement in laundering fentanyl proceeds for Mexican cartels like the Sinaloa and CJNG has raised national security concerns. Experts and U.S. lawmakers fear that some of the illicit funds could be used for nefarious purposes in the U.S., such as corporate espionage or election meddling. Dennis Wilder, a former CIA officer, emphasized the need for American authorities to investigate potential connections to China’s spy agency, the Ministry of State Security. “Obviously this has been neglected in the U.S. government,” Wilder said. “It needs attention.”

Former DEA agents have spent years trying to curb the rise of Chinese money laundering networks in the U.S., but progress has been limited due to the time, manpower, and political will required to penetrate these financial networks. With fentanyl deaths spiking during the pandemic, law enforcement prioritized traffickers over the financial networks supporting the cartels. “We’ve let this happen,” Urben said.

Since 2023, federal prosecutors have charged at least 31 people linked to Chinese groups accused of laundering cartel drug money, but these cases represent only a fraction of the problem. Thousands of Chinese money brokers are believed to be operating across the country. Bill Bodner, former head of the DEA’s Los Angeles division, expressed concern over the lack of visibility into these networks. “Is there more to the story that most of us don’t know yet?” he said.