The suspects made at least $30 million in an alleged scheme that continued from 2008 to late last month and involved funneling illicit drug money to traffickers in Latin America, including the feared Sinaloa cartel, according to court documents.
Federal prosecutors allege that the men laundered their drug proceeds by purchasing products in the U.S. and shipping them to China. The products were then sold through “black market merchants” in China, the indictment says, with the money sent back to drug traffickers in Latin America, “often Mexicans,” through Chinese currency.
The effort, the indictment says, “required special care and skill” in money laundering.
One of the suspects, Tao Liu, was also charged with trying to bribe two men, who turned out to be undercover Drug Enforcement Administration agents, in order to get fraudulent passports.
The other five men were identified in court documents as Xizhi Li, Jianxing Chen, Jingyan Li, Eric Yong Woo, Jiayu Chen. The men were all born in China but now reside in New York, California and several Latin American countries, according to the indictment.
All of the suspects except for Jiayu Chen have been taken into custody, authorities said. It was not immediately clear if they had hired lawyers.
“These individuals went to great lengths to conceal their alleged criminal activities and further schemes that enabled drug cartels to push their poisons on our communities and launder their illicit proceeds,” said Wendy Woolcock, special agent in charge of the DEA’s Special Operations Division.
In a statement, the Justice Department said the indictment was the result of “a nearly four-year investigation into the relationship between foreign drug trafficking organizations and Asian money laundering networks in the United States, China, and elsewhere.”
Federal prosecutors allege that Xizhi Li, who went by the aliases Juan Lee and had a WeChat name of “JL 007” and “SUPERKING 99,” developed close ties with drug traffickers and cartels in Mexico, Colombia, Guatemala, and elsewhere to obtain contracts to move drug proceeds for the dealers.
The other five men are accused of working with Xizhi Li to help launder the drug money in a scheme that began in 2008 and lasted up until late last month, the indictment says.
Xizhi Li allegedly had bank accounts with BBVA Compass in Miami, Florida, which he used as part of the conspiracy.
In a 2019 DEA seizure application for BBVA accounts in Tennessee, investigators told the court that in the course of investigating a local drug gang they determined that the cocaine in the greater Memphis area was being supplied by the Sinaloa cartel and the money laundering efforts for those transactions were allegedly directed by Xizhi Li.
BBVA Compass did not respond to a request for comment.
The indictment also says Xizhi Li owned and operated a casino in Guatemala City, Guatemala, which he used to launder money and provided him a place to meet drug traffickers.
Tao is accused of trying to fraudulently obtain passports for multiple people in April. He allegedly struck a deal with undercover agents who told him they knew someone at the State Department who could illegally provide passports at a cost of $150,000 each.
The indictment says that Tao agreed to deposit about $5,000 in cryptocurrency and $5,000 in cash into what turned out to be a DEA-controlled account in order to start the process of getting the passports.
Tao was also hit with a separate money laundering charge for allegedly moving some of the funds through cryptocurrency.
Tom Winter is a New York-based correspondent covering crime, courts, terrorism and financial fraud on the East Coast for the NBC News Investigative Unit.
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