US Agency Says Chinese Drug Traffickers Used Bitcoin To Launder Proceeds

The U.S. Office of Foreign Assets Control (OFAC), a division of the Treasury Department, sanctioned 4 Chinese nationals for allegedly utilizing cryptocurrency to wash issue from illicit drug transactions.

In a press launch Friday, OFACintroduced that Songyan Ji, Longbao Zhang, Guifeng Cheng and Guangfu Zheng, additionally to Global Biotechnology Inc., as offering help to the Zheng Drug Trafficking Organization below the Foreign Narcotics Kingpin Act.

Zheng DTO was additionally listed in a earlier sanctions effort by OFAC, when the division added Xiaobing Yan, Fujing Zheng and Guanghua Zheng to its Specially Designated Nationals (SDN) listing as narcotics traffickers final August.

“The Zheng DTO washed its drug issue in part by exploitation digital currency such as bitcoin, transmitted drug issue into and out of bank accounts in China and Hong Kong, and bypassed currency restrictions and coverage requirements,” the discharge stated.

Unlike final August’s motion, no bitcoin or different crypto addresses have been added to the sanctions listing. The launch additionally didn’t point out the order of magnitude of the alleged washing.

OFAC’s motion means it’s making an attempt to grab all property belonging to the people inside the U.S., and U.S. entities are actually prohibited from dealing or transacting with the 4 designees.

Friday’s motion is just the third time cryptocurrency has come up in an OFAC sanctions replace. The company first indicated it could add crypto addresses to its sanctions listing in March 2019, expression crypto could be handled identically to fiat currencies so far as the SDN listing was involved.

The SDN listing is OFAC’s black book for people or entities who the company believes has profaned U.S. legislation.

In addition to final August’s actions, OFAC has additionally sanctioned two Iranian residents it claimed have been concerned in washing monetary resource from the SamSam ransomware, which compact government companies and personal entities.

That motion, in 2019, marked the primary time bitcoin addresses appeared on the SDN listing.


The chief in blockchain information, CoinDesk is a media outlet that strives for the best print media requirements and abides by a strict set of editorial insurance policies. CoinDesk is an impartial working subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

US Agency Says Chinese Drug Traffickers Used Bitcoin To Launder Proceeds

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