The Biden administration is going after the fentanyl supply chain with a crackdown on Chinese companies that make the raw materials for the deadly drug behind a record-breaking U.S. overdose epidemic.

The Justice Department announced this week that it filed criminal charges against Chuen Fat Yip, a Wuhan-based drug manufacturer accused of manufacturing and distributing a key ingredient in fentanyl. Prosecutors said they seized $2.3 million from a Yip-connected crypto wallet in November.

Chinese money launderers and fentanyl makers have gone into business with Mexican drug cartels to push fentanyl across the U.S. border. The Trump administration pressured Chinese leader Xi Jinping in 2019 to make fentanyl illegal, but drug labs in Wuhan simply shifted to manufacturing the precursor ingredients for the drugs instead.

Yip allegedly owned and operated the Wuhan Yuancheng Group, which the DOJ said has shipped hundreds of millions of dollars worth of fentanyl ingredients and anabolic steroids out of Shanghai and Hong Kong to locations around the globe. To get the drugs into the United States, Yip’s group allegedly conspired with Mexican drug smugglers.

“We cannot allow foreign nationals to flood the United States with dangerous drugs,” U.S. Attorney Chad Meacham said. “This defendant allegedly made millions manufacturing and distributing anabolic steroids and fentanyl precursors to American customers. The Justice Department will pursue drug defendants to the furthest reaches of the globe if that’s what it takes to stem the tide of the drug epidemic.”


The Centers for Disease Control and Prevention say that the 12-month time period from April 2020 to April 2021 saw a record 98,331 drug overdose deaths in the U.S. The shocking figure was a 30% increase over the previous yearlong period. Opioids accounted for the highest number of overdose deaths, followed by synthetic opioids such as fentanyl.

The State Department also offered a $5 million reward this week for information leading to the arrest and/or conviction of Yip, as well as information leading to the disruption of his group’s finances, and said there were also $5 million rewards for information leading to the arrests and/or convictions of Chinese nationals Fujing Zheng and Guanghua Zheng, who have been charged with illegally importing fentanyl.


In a related announcement, the Treasury Department said its Office of Foreign Assets Control had sanctioned 10 individuals and 15 drug trafficking groups for their role in “the international proliferation of illicit drugs or their means of production.” The targets were located in Brazil, Colombia, Mexico, and China, with Yip and his group among those sanctioned.

Other Chinese groups hit with sanctions were Shanghai Fast-Fine Chemicals, accused of shipping falsely labeled fentanyl precursor products to Mexico for production of fentanyl intended for the U.S., and Hebei Huanhao Biotechnology and Hebei Atun Trading, also involved in illicit fentanyl precursor production and sale.