Mexican cartels are fueling the overdose crisis in America but China remains a key player in the supply chain, serving as the exclusive supplier of machines that cartels use to press fentanyl into pill form and as the primary launderer of drug profits, border officials and investigators told Congress on Wednesday.
China stopped shipping fentanyl directly to the U.S. under pressure from the Trump administration in 2019, but it is still shipping fentanyl-precursor chemicals to Mexico.
While its role in the chemical chain is well-known, Chinese actors have their tentacles in other parts of the trade, said Matthew Millhollin, assistant director for countering transnational organized crime at Homeland Security Investigations.
“We just seized over 200 pill presses at a warehouse in Los Angeles that came directly from China,” Mr. Millhollin testified during a Senate hearing on ways to stop criminal organizations that are responsible for the flow of synthetic opioids into the U.S.
China is also the go-to nation for laundering money tied to fentanyl sales.
“This used to be an industry that was dominated by Colombian transnational organizations, charging 10% to 12% to launder illicit funds. That’s now controlled by the Chinese, charging 1% to 2% to launder money back outside the U.S.,” Mr.
Millhollin said. “This problem begins and ends in China.”
Sen. Chris Murphy, Connecticut Democrat and chairman of the Senate Appropriations Subcommittee on Homeland Security, called the hearing as he proposes nearly $1 billion in new funding for the fentanyl fight.
Roughly 70,000 of the 107,000 overdose deaths in the U.S. were linked at least in part to fentanyl in 2021, the most recent year for which complete data is available.
The U.S. government says nearly all of the finished fentanyl supply flows out of Mexico, often in the form of counterfeit pills that are taken by addicted persons or unsuspecting users.
Much of the funding in Mr. Murphy’s proposal would be used to hire and deploy 500 additional Customs and Border Patrol officers at ports of entry and purchase equipment to scan incoming vehicles. Mr. Murphy wants to increase the share of vehicles scanned from 40% to 65%.
About $300 million would be devoted to upgrading existing inspection equipment.
Democrats say most of the fentanyl that is reaching American streets comes through ports of entry, though Republicans say the administration is ignoring the amount that slips through unguarded portions of the border.
“It is by and large not the individuals who are sneaking in between ports of entry. It is actually vehicles and individuals who cross at the ports of entry. We can do a much better job of stopping that traffic,” Mr. Murphy said.
James Mandryck, deputy assistant commissioner of intelligence and analysis at U.S. Customs and Border Protection, said roughly 90% to 95% of fentanyl that is seized is discovered at ports of entry. He said while that is not a concrete indication of the overall flow of drugs into the country, it is a good measuring stick.
Mr. Murphy faulted the House GOP for proposing a budget that would significantly cut funding for agencies involved in the fentanyl fight.
But Sen. Katie Britt of Arkansas, the top Republican on the subcommittee, said the Biden administration is the one courting disaster. She is worried about what will happen when the administration lifts Title 42, the pandemic measure that allowed the government to turn away many migrants at the border, next week.
“The answer is we are likely to see more fentanyl being brought in,” Ms. Britt said.
The Sinaloa Cartel and Jalisco New Generation Cartels are involved in human smuggling at the border. At the same time, they’re driving the fentanyl trade.
Mr. Mandryck said the cartels’ ability to evolve is the secret to their success. For instance, they quickly pivoted from agriculture-based drugs to synthetic drugs in recent years, maximizing profits.
“They are no longer subject to weather conditions or crop seasons, so they’re allowed to produce year-round at industrial-level production,” he said.
China remains the biggest supplier of the precursor chemicals that cartels need to manufacture synthetic drugs like fentanyl. India has served as a supplier, too, though Mr. Millhollin said the U.S. has good diplomatic relations with the Indian government and has been able to rein in the flow.
Sen. Jon Tester, Montana Democrat who faces a tough reelection bid next year, pressed Mr. Millhollin on efforts to crack down on rogue actors in China.
“We’re trying to track those [chemicals] back to China. We do have relations in China. We do have offices in China, to have a little bit of law enforcement contact there,” Mr. Millhollin said. But he added, “It’s pretty difficult, sir.”
