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Justice Department Goes After China-Based Companies in Fentanyl Fight

Court Filing/U.S. District Court, Southern District of Florida
Court Filing/U.S. District Court, Southern District of Florida

By Brett Rowland | The Center Square

The Justice Department unsealed eight indictments in Florida on Tuesday charging China-based companies and their employees with crimes related to fentanyl and methamphetamine production, distribution of synthetic opioids and sales resulting from precursor chemicals.

Tuesday's indictments come after similar prosecutions announced in June. The indictments charge China-based chemical manufacturing companies and nationals of the People’s Republic of China for trafficking fentanyl precursor chemicals into the United States.

"We know that the global fentanyl supply chain, which ends with the deaths of Americans, often starts with chemical companies in China," Attorney General Merrick Garland said in a statement. "The United States government is focused on breaking apart every link in that chain, getting fentanyl out of our communities, and bringing those who put it there to justice."

U.S. officials reported 107,735 overdose deaths between August 2021 and August 2022 from drug poisonings, according to the U.S. Centers for Disease Control and Prevention. About 66% of those deaths involved synthetic opioids such as fentanyl.

The Drug Enforcement Administration-led investigations used the agency's authority to specially schedule protonitazene and metonitazene as Schedule I controlled substances. Swiss chemical company CIBA Aktiengesellschaft developed protonitazene, metonitazene and other synthetic substances of the benzimidazole structural class in the 1950s. They have since emerged as drugs of abuse, according to the DEA.

Protonitazene and metonitazene are synthetic opioids that were listed as Schedule I controlled substances in April 2022. Traffickers typically mix protonitazene and metonitazene with other opioids, such as fentanyl, to create powerful cocktails of opioids, according to the DEA.

A study this summer found that nitazenes were being detected in overdose cases. Why nitazenes are showing up in the illicit drug supply is unclear, but researchers said it may be the result of changing regulations.

"The exact motivation to produce nitazenes and brorphine are unclear," according to the study. "The increased regulation of fentanyl and fentanyl analogues throughout the last decade may have led to a change in the chemical precursors required for clandestine laboratory production that were not yet regulated. This change in chemical precursors may have led to these newer and more potent opioids."

Homeland Security Investigations and U.S. Customs and Border Protection seized more than 1,000 kilograms of fentanyl-related precursor chemicals, and the United States Postal Inspection Service also traced packages containing the precursor chemicals mailed through the U.S. mail and analyzed their contents after seizure.

Five indictments were unsealed in the Middle District of Florida. They charge five Chinese corporations and eight Chinese nationals with the illegal importation of fentanyl and fentanyl-related chemicals into the United States.

The defendants openly advertised their ability to thwart U.S. customs and deliver the chemicals used to make fentanyl. The defendants used fake shipping labels and special delivery procedures to ensure the chemicals went undetected, according to the indictments.

"We will continue to pursue cases against Chinese chemical companies who are knowingly manufacturing and exporting fentanyl precursors to profit on the pain and suffering of people in the United States," U.S. Attorney Roger Handberg for the Middle District of Florida said in a statement.

Prosecutors charged Hebei Shenghao Import and Export Company, based in Shijiazhuang, Hebei Province, China, with fentanyl trafficking conspiracy, along with Chinese nationals Qingshun Li, 29, who allegedly negotiates the sale of precursor chemicals and maintains a bank account for the receipt of payments; Qingsong Li, 32; and Chunhui Chen, 33, both of whom allegedly maintain cryptocurrency wallets for the remittance of payments of precursor chemicals; Chunzhou Chen, 30, who allegedly received Western Union payments on behalf of Hebei Shenghao.

Prosecutors charged Lihe Pharmaceutical Technology Company, based in Wuhan, Hebei Province, China, with fentanyl trafficking conspiracy and international money laundering, along with Chinese nationals Mingming Wang, 34, who is the alleged holder for three bitcoin accounts shared by sales agents for Lihe Pharmaceutical, and Xinqiang Lu, 40, the alleged recipient of funds via Western Union on the company’s behalf.

Prosecutors charged Henan Ruijiu Biotechnology Company, based in Zhengzhou, Henan Province, China, with attempted importation of fentanyl precursor and attempted international money laundering, along with Chinese national Yongle Gao, 30, who is the alleged registered owner of the bitcoin wallet associated with Henan Ruijiu.

Prosecutors charged Xiamen Wonderful Biotechnology Company, based in Xiamen, Fujian Province, China, with attempted importation of fentanyl precursor and attempted international money laundering, along with Chinese national Guo Liang, 34, the alleged registered owner of the bitcoin wallet associated with Xiamen Wonderful.

Prosecutors charged Anhui Ruihan Technology Company, based in Hefei, Anhui Province, China, with attempted importation of fentanyl precursor and attempted international money laundering.

Three indictments were unsealed in the Southern District of Florida charging three Chinese companies and four officers and employees with fentanyl trafficking, synthetic opioid trafficking, precursor chemical importation, defrauding the U.S. Postal Service, and making and using counterfeit postage.

Hanhong Medicine Technology Company, a pharmaceutical company located in Wuhan, Hubei Province, China, was charged in a four-count indictment, along with Chinese nationals Changgen Du, 30, and Xuebi Gan, 28. According to the indictment, Hanhong exported large quantities of fentanyl precursors and non-opioid additives, such as xylazine, to the United States and Mexico, including to a drug trafficker in Pennsylvania and to a drug trafficker in the Sinaloa cartel for the manufacture of fentanyl in Mexico for eventual distribution in the United States.

Xylazine is a non-opioid tranquilizer approved for animal use. Xylazine is not approved for use in people. But it has made its way into the unregulated supply of illicit drugs, including heroin, fentanyl and other drugs. The U.S. Drug Enforcement Agency has seized xylazine and fentanyl mixtures in 48 of 50 states. The agency's laboratory system reported that about 23% of fentanyl powder and 7% of fentanyl pills seized by the DEA in 2022 contained xylazine.

Xylazine can be mixed with other drugs either to enhance drug effects or increase street value by increasing the weight of the product.

The Du Transnational Criminal Organization, is listed on the United States Attorney General’s Consolidated Priority Organization Target list. The CPOT list identifies the most significant transnational criminal organizations that present a priority threat to the U.S.

Du, as the criminal organization’s leader, is the director of Hanhong and allegedly negotiates sales with customers. Gan is an alleged sales representative. Du and Gan each operated a crypocurrency wallet that accepted payment for Hanhong’s sales. The four-count indictment charges Hanhong, Du, and Gan with conspiracy to manufacture and distribute fentanyl; conspiracy to manufacture and distribute a fentanyl precursor with intent to unlawfully import it into the U.S.; manufacturing and distributing a fentanyl precursor with intent to unlawfully import it into the U.S.; and conspiracy to commit money laundering.

Jiangsu Bangdeya New Material Technology Company, a pharmaceutical company located in Jiangsu, China, was charged in an eight-count indictment, along with Jiantong Wang, 40, a Chinese national and alleged owner and operator of Bangdeya. The indictment alleges that Bangdeya advertises online as an export company for chemicals, including synthetic opioids protonitazene and metonitazene.

Bangdeya and Wang were charged with conspiracy to import protonitazene and metonitazene; conspiracy to distribute protonitazene and metonitazene; multiple counts of distribution of protonitazene; conspiracy to defraud the United States and make and use forged and counterfeited postage; and making and printing unauthorized postage meter stamps.

Hubei Guanlang Biotechnology Company, a chemical company located in Shijaizhuang, Hebei Province, China, was charged in a two-count indictment, along with Chinese national Wei Zhang, 28, who allegedly runs the day-to-day operations of the company and operates a cryptocurrency wallet that accepts payment for the company’s sales of fentanyl precursors and opioid additives.

According to the indictment, Guanlang advertises online and sells an array of chemicals, including methamphetamine precursors like methylamine HCL, to customers in the United States and Mexico. Methylamine HCL is a precursor chemical that Mexican cartels use to make pure and potent methamphetamine. Most of the methamphetamine supply in the United States is produced by drug trafficking cartels in Mexico, according to the DEA.

Guanlang and Zhang were charged with conspiracy to manufacture and distribute a methamphetamine precursor and unlawfully import into the U.S. and conspiracy to unlawfully import a methamphetamine precursor into the U.S. with the intent to manufacture methamphetamine; and the manufacture and distribution of a methamphetamine precursor that was unlawfully imported into the United States.

Nearly 90% of U.S. voters are concerned about fentanyl trafficking as drug overdose deaths continue to mount in the U.S. ahead of the 2024 election. The Center Square Voters' Voice Poll, conducted by Noble Predictive Insights, found that 57% of those surveyed are very concerned about fentanyl overdose deaths. An additional 32% are somewhat worried, or 89% overall indicating some level of concern. By contrast, 7% of the 2,500 registered voters surveyed said they aren't concerned about fentanyl overdose deaths. Another 3% said they were unsure about fentanyl, according to poll results.

In 2020, the DEA released a report that stated China "remains the primary source of fentanyl and fentanyl-related substances trafficked through international mail and express consignment operations environment, as well as the main source for all fentanyl-related substances trafficked into the United States."

Related Story: U.S. Charges Chinese Companies, Executives with Illicit Fentanyl Trafficking

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