The Treasury Department wants US financial institutions to monitor for suspected Chinese money laundering networks handling funds that are used to fuel the flood of fentanyl across American communities.
The advisory released on Thursday highlights how these money laundering operations are working with Mexican drug cartels to fuel the flood of fentanyl across American communities.
The Trump administration is calling on banks to flag certain customers who may fit a profile of people who could launder money for cartels. That could include Chinese nationals such as students, retirees and housewives with unexplained wealth, and those who refuse to provide information about the source of their money.
The Treasury contends that many of these people unknowingly work with cartels to bypass Chinese currency controls that restrict the renminbi exchange rate through a system limiting the annual foreign currency conversion for individuals, which is about US$50,000.
It is not uncommon for Chinese individuals to evade such restrictions by turning to underground banks, where their money is converted into foreign currencies, often US dollars.
The Chinese Embassy in Washington had no immediate comment on Thursday.
