A recent FinCEN report has revealed that U.S. banks moved $312 billion for Chinese money-laundering networks between 2020 and 2024, fueling operations linked to Mexican drug cartels. Despite these staggering figures, lawmakers continue to target cryptocurrency as the primary culprit for financial crimes.
FinCEN Report Exposes Billions in Illicit Bank Transactions
The U.S. Financial Crimes Enforcement Network (FinCEN) analyzed over 137,000 Bank Secrecy Act filings spanning four years. Findings show that $62 billion per year, on average, passed through the U.S. banking system from Chinese laundering operations.
According to the advisory, these networks form a symbiotic relationship with Mexican cartels:
- Cartels need U.S. dollars to legitimize drug proceeds.
- Chinese gangs seek U.S. dollars to bypass China’s strict currency controls.
FinCEN Director Andrea Gacki warned these organizations are also involved in human trafficking, healthcare fraud, elder abuse, and even real estate laundering, which accounted for $53.7 billion in suspicious transactions.
Crypto Still Wrongly Singled Out by Lawmakers
Despite overwhelming evidence pointing to traditional banking systems as the main vehicle for illicit finance, some U.S. politicians continue to target digital assets. Senator Elizabeth Warren, for instance, has repeatedly argued that criminals are “increasingly turning to cryptocurrency,” calling for tougher regulations.
However, data tells a different story:
- Global money laundering through banks exceeds $2 trillion annually (United Nations estimate).
- In contrast, illicit crypto transactions totaled just $189 billion over the past five years, according to Chainalysis.
Experts note that illicit crypto activity accounts for less than 1% of total crypto volume, making it negligible compared to the banking sector.
A Shadow Banking System vs. Crypto’s Fractional Role
“FinCEN’s findings highlight how these underground banking networks operate as a shadow financial system for organized crime,” said Angela Ang, head of policy at TRM Labs. This exposes a double standard where banks enable vast sums of dirty money, while crypto faces disproportionate scrutiny.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.