WASHINGTON — Health Care and Financial Services Subcommittee Chairwoman Lisa McClain (R-Mich.) opened today’s subcommittee hearing on “China in Our Backyard: How Chinese Money Laundering Organizations Enrich the Cartels” by outlining how cartels have partnered with Chinese Money Laundering Organizations to make more money and traffic deadly fentanyl into the United States. She emphasized the importance of Congress working to understand the extent of the Chinese Communist Party’s complicity in these money laundering schemes. She closed by thanking the witnesses appearing before the subcommittee for providing Congress with information that can be used to curb and dismantle Chinese crime rings working with cartels.
Below are Subcommittee Chairwoman McClain’s remarks as prepared:
Welcome to the Subcommittee on Health Care and Financial Services.
Today’s oversight hearing focuses on the role that Chinese Money Laundering Organizations are playing to enrich the cartels.
We will hear from former federal law enforcement and foreign policy experts to better understand how these criminal organizations came to dominate the money laundering industry.
We will also learn about different tools Congress and the Administration can use to cut off these networks.
Illicit fentanyl presents one of the biggest, if not the biggest, threats to public safety that the United States has ever seen.
Fentanyl is now the leading cause of death for Americans aged 18 to 45, claiming more American lives in that age group than suicide, COVID-19, and automobile accidents.
In 2020 alone, 2,759 Michiganders lost their life to a drug overdose poisoning, with approximately 75 percent of those drug overdose deaths involving synthetic opioids like fentanyl.
President Biden’s open border policies have exacerbated the fentanyl crisis.
Cartels have taken advantage of the open border and overwhelmed officials, smuggling deadly narcotics across our borders and into American communities.
And it only takes a tiny amount to kill.
Looking to profit from this dangerous enterprise, criminal organizations based in the People’s Republic of China have captured the money laundering business for the cartels.
These Chinese Money Laundering Organizations have developed an incredibly efficient system that is increasingly difficult for law enforcement to detect.
Prior to the rise of Chinese Money Laundering Organizations, cartels laundered their profits on the black-market peso exchange and had to wait at least a week before they received their “clean” funds.
Now, Chinese Money Laundering Organizations have a system that ensures that cartels receive their profits within hours of handing over illicit drug funds to a courier.
Not only are these Chinese Money Laundering Organizations able to do this quickly and with incredible efficiency, they do it at a fraction of the cost that cartels were previously forced to pay.
Altogether, the efficiency and cost effectiveness of Chinese Money Laundering Organizations has significantly increased the cartels’ bottom line and allowed their illicit business to grow and expand.
As a result, more and more Americans are losing their lives to synthetic opioid addiction and fentanyl poisoning.
And Chinese Money Laundering Organizations have a nearly foolproof system in place that doesn’t require placing illicit funds into the U.S. financial system.
Using Chinese banking apps and other popular Chinese encrypted communications technology, like WeChat, Chinese Money Laundering Organizations are able to launder cartel drug money all while evading detection by U.S. law enforcement.
It is no secret that China has become a global hub of money laundering activity. The State Department has estimated that $154 billion in illicit funds pass through China every year.
It is imperative that Congress works to understand the extent of the Chinese Communist Party’s complicity in these money laundering schemes.
Wealthy Chinese Communist Party elites are turning a blind eye to these laundering networks and China’s role in illicit drug manufacturing.
Americans are tired of seeing their friends and loved ones fall prey to fentanyl and opioid addiction.
As Members of Congress, we owe it to our constituents to do everything we can to eradicate this dangerous drug from our communities.
We must hold these bad actors accountable.
Thank you to our witnesses and we look forward to your testimony.
Now I yield to Ranking Member Porter for her opening statement.