Disrupting the Illicit Fentanyl Supply Chain: A Success Story
Treasury Department Leads Effort to Disrupt Illicit Fentanyl Supply Chain
The U.S. Department of the Treasury, in collaboration with FinCEN, DEA, and HSI, has successfully dismantled a major drug trafficking organization responsible for distributing illicit fentanyl and fentanyl analogues across the United States.
The Zhang Jian Drug Trafficking Organization
In 2017 and 2018, the Department of Justice charged the Zhang Jian drug trafficking organization (DTO) with conspiracy to distribute dangerous drugs. The organization, with international connections, would send orders of fentanyl or other illicit drugs to customers in the U.S. through mail or delivery services.
Investigation and Sentencing
As a result of the investigation, 34 defendants were charged, and over $1 million in cash and property was forfeited. In July 2023, three members of the DTO were sentenced to a combined 73 years in prison for their roles in the operation. Additionally, Treasury sanctioned Zhang and four other Chinese nationals working on his behalf under the Foreign Narcotics Kingpin Designation Act.
International Cooperation
The successful investigation highlights the importance of international cooperation in combating drug trafficking and money laundering. “Treasury is committed to disrupting the illicit fentanyl supply chain and holding accountable those responsible for trafficking narcotics into the United States,” said a Treasury official.
FinCEN’s Role
FinCEN plays a critical role in this effort, analyzing tens of thousands of suspicious activity reports (SARs) and other financial data to identify trends and patterns that can lead to law enforcement action. Recent analysis has identified an increasing involvement of criminal money laundering organizations (CMLOs) in domestic and global money laundering activities associated with drug trafficking.
Domestic Efforts
Treasury is also working closely with foreign counterparts, including the People’s Bank of China, to combat illicit fentanyl production and sale. In January 2024, Treasury participated in the inaugural meeting of the U.S.-PRC Counter Narcotics Working Group (CNWG) in Beijing, where officials pressed Chinese authorities to investigate a group of entities and individuals designated for their role in producing and selling illicit fentanyl precursors.
Domestically, Treasury is updating its frameworks to counter money laundering through the abuse of opaque legal entities and untraceable real estate transactions. The Corporate Transparency Act, implemented by FinCEN, requires certain corporations and LLCs to report their beneficial owners. This increased transparency will make it harder for criminals to hide and evade justice.
Commitment to Combating Illicit Fentanyl Trafficking
“Treasury is committed to combating the threats posed by CMLOs and broader illicit fentanyl trafficking networks,” said a Treasury official. “We look forward to continuing our work with Congress, law enforcement agencies, and international partners to disrupt these criminal organizations and keep our communities safe.”