24 People Charged in Alleged Drug Money Laundering Scheme

24 People Charged in Alleged Drug Money Laundering Scheme

(LibertyInsider.org) – Federal prosecutors unsealed a 10-count superseding indictment on Monday, June 17, against Edgar Joel Martinez-Reyes, 45, and 23 other defendants, who allegedly conspired to launder Sinaloa Cartel drug money proceeds with the help of Chinese underground banking firms. Multiple agencies cooperated on the conspiracy investigation, nicknamed “Operation Fortune Runner,” which took several years to flesh out.

The Justice Department has charged each of the two dozen defendants with counts of conspiracy to launder monetary instruments, conspiracy to aid and abet the distribution of cocaine and methamphetamine, conspiracy to operate an unlicensed money-transmitting business, structuring funds to avoid federal reporting requirements, possession of controlled substances, and assault with a deadly weapon on a federal officer.

The indictment alleges that Martinez-Reyes met with Sinaloa Cartel members in Mexico in January 2021 on behalf of Chinese underground banking interests to propose a deal to launder the cartel’s US trafficking proceeds. According to prosecutors, Martinez-Reyes and his co-conspirators delivered cartel cash to Chinese-directed money-exchange members and remitting organizations.

Remitters allegedly delivered cash to Chinese nationals or exchanged it for luxury goods, real estate, or cryptocurrency.

Additionally, remitters allegedly deposited smaller amounts of cash into traditional bank accounts via cashier’s checks, a financial move called “structuring” that allows depositors to avoid banks reporting large cash deposits to the government.

A growing number of Chinese nationals want to develop assets in the US, per the DOJ press release. However, the Chinese Communist Party has placed stringent restrictions on its citizens regarding investments greater than $50,000 outside of China. The Chinese underground banking organizations allow wealthy Chinese citizens to diversify their assets outside China.

Chinese banking associates can “buy” access to US currency using Chinese currency or obtain other goods in trade. Martines-Reyes and his co-conspirators allegedly took a percentage for brokering the deals and concealing the source and nature of the funds.

US Attorney Martin Estrada said that drug trafficking in “dangerous drugs like fentanyl and methamphetamine” was “destroying people’s lives.” However, cartel members, Chinese underground bankers, and money brokers “only care about their profits.”

DEA Administrator Anne Milgram credited the investigation with uncovering “a partnership between Sinaloa Cartel associates and a Chinese criminal syndicate […] to launder drug money.” She promised more operations to defeat Mexican drug cartels.

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