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Indictments reveal how eight Chinese firms used cryptocurrency to obscure profits from illegal chemical sales.
US Indicts Chinese Firms Using Cryptocurrency in Illicit Trade
The U.S. Department of Justice (DOJ) has unsealed indictments against eight China-based chemical companies and employees for their alleged involvement in trafficking fentanyl precursor chemicals and laundering money through cryptocurrency.
Filed in the Middle District of Florida, the charges reveal how these companies and individuals used cryptocurrency wallets, including bitcoin, to mask payments linked to illegal synthetic opioid sales. For example, Guangzhou Tengyue Chemical Co. Ltd. and Hubei Shanglin Trading Co. allegedly used bitcoin wallets managed by employees, such as Xiaojun Huang and Zhihan Wang, to receive payments on behalf of their companies for the illicit chemical sales. The indictments spotlight cryptocurrency’s role in facilitating cross-border transactions, underscoring its appeal for international networks seeking to evade law enforcement. Attorney General Merrick B. Garland stated:
The Justice Department has aggressively investigated and prosecuted these companies. We will continue to target every organization and individual that fuels the deadly drug trade.
DEA Administrator Anne Milgram stressed the agency’s resolve to disrupt such networks, stating that the DEA “will use every tool and authority” to combat fentanyl trafficking.
Several companies, including Wuhan Jinshang Import & Export Trading Co. Ltd. and Henan Oumeng Trade Co. Ltd., allegedly used crypto as a key mechanism to transfer profits derived from fentanyl precursors. These financial methods allow for near-anonymous transactions across jurisdictions, making it difficult for authorities to track. The cases illustrate the need for increased scrutiny over crypto transactions linked to illegal activities and the broader challenge of cryptocurrency’s role in the global synthetic opioid trade.