U.S. Department of the Treasury’s Financial Crimes Enforcement Network issues advisory and trend analysis on Chinese money laundering networks

The U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) issued an advisory urging financial institutions to strengthen detection and reporting of activity linked to Chinese money laundering networks (CMLNs) used by Mexico-based drug cartels, including several designated as Foreign Terrorist Organizations, and published a Financial Trend Analysis mapping the scale and typologies of suspected CMLN activity in the United States. The Financial Trend Analysis draws on 137,153 Bank Secrecy Act reports filed between January 2020 and December 2024, representing about USD 312 billion in suspicious transactions. FinCEN describes CMLNs as professional money launderers heavily used to move drug trafficking proceeds, with reporting also indicating links to other illicit activity including fraud, human trafficking, and human smuggling. The release highlights a model in which U.S.-based CMLNs obtain U.S. dollars from cartels and sell them to Chinese citizens seeking to evade the People’s Republic of China’s currency controls, supported by methods such as trade-based money laundering, money mule and mirror transaction schemes, and potential recruitment or placement of insiders at financial institutions. FinCEN also points to suspected real estate-related laundering reflected in 17,389 reports involving more than USD 53.7 billion, and publishes red flags for firms, including account holders presenting as “student,” “housewife,” “retired,” or “laborer” during onboarding while conducting large volumes of unexplained transactions.