Canada increasingly exploited by China for fentanyl production and export, with over 350 gang networks operating, Canadian Security Intelligence Service reports
As the Trump Administration gears up to launch a comprehensive war on fentanyl trafficking, production, and money laundering, the United States is setting its sights on three nations it holds accountable: China, Mexico, and Canada. In an exclusive investigation, The Bureau delves into the U.S. government’s case, tracking the history of fentanyl networks infiltrating North America since the early 1990s, with over 350 organized crime groups now using Canada as a fentanyl production, transshipment, and export powerhouse linked to China, according to Canadian intelligence.
Drawing on documents and senior Drug Enforcement Administration sources—including a confidential brief from an enforcement and intelligence expert who spoke on condition of anonymity due to the sensitivity of the matter—we unravel the evolution of this clandestine trade and its far-reaching implications, leading to the standoff that will ultimately pit President Donald Trump against China’s Xi Jinping.
In a post Tuesday morning that followed his stunning threat of 25 percent tariffs against Mexico and Canada, President Trump wrote:
“I have had many talks with China about the massive amounts of drugs, in particular fentanyl, being sent into the United States—but to no avail. Representatives of China told me that they would institute their maximum penalty, that of death, for any drug dealers caught doing this but, unfortunately, they never followed through, and drugs are pouring into our country, mostly through Mexico, at levels never seen before.”
While Trump’s announcements are harsh and jarring, the sentiment that China is either lacking motivation to crack down on profitable chemical precursor sales—or even intentionally leveraging fentanyl against North America—extends throughout Washington today.
And there is no debate on where the opioid overdose crisis originates.
At a November 8 symposium hosted by Georgetown University’s Initiative for U.S.-China Dialogue on Global Issues, David Luckey, a defense researcher at RAND Corporation, said: “The production, distribution, and use of illegally manufactured fentanyl should be thought of as an ecosystem, and the People’s Republic of China is at the beginning of the global fentanyl supply chain.”
The Bureau’s sources come from the hardline geopolitical camp on this matter. They believe Beijing is attempting to destabilize the U.S. with fentanyl, in what is technically called hybrid warfare. They explained how Canada and Mexico support the networks emanating from China’s economy and political leadership. In Canada, the story is about financial and port infiltration and control of the money laundering networks Mexican cartels use to repatriate cash from fentanyl sales on American streets.
And this didn’t start with deadly synthetic opioids, either.
“Where the drugs come from dictates control. If marijuana is coming from Canada, then control lies there,” the source explained. “Some of the biggest black market marijuana organizations were Chinese organized crime groups based in Brooklyn and Flushing, Queens, supplied from Canada.
“You had organizations getting seven or eight tons of marijuana a week from Canada, all controlled by Chinese groups,” the source said. “And we have seen black market marijuana money flowing back into Canadian banks alongside fentanyl money.”
Canada’s legal framework currently contributes to its appeal for China-based criminal organizations. “Canada’s lenient laws make it an attractive market,” the expert explained. “If someone gets caught with a couple of kilos of fentanyl in Canada, the likelihood of facing a 25-year sentence is very low.”
The presence in Toronto and Vancouver of figures like Tse Chi Lop—a globally significant triad leader operating in Markham, Ontario, and with suspected links to Chinese Communist Party security networks—underscores the systemic gaps.
“Tse is a major player exploiting systemic gaps in Canadian intelligence and law enforcement collaboration,” the source asserted.
Tse Chi Lop was operating from Markham and locations across Asia prior to his arrest in the Netherlands and subsequent extradition to Australia. He is accused of being at the helm of a vast drug syndicate known as “The Company” or “Sam Gor,” which is alleged to have laundered billions of dollars through casinos, property investments, and front companies across the globe.
Reporting by The Bureau has found that British Columbia, and specifically Vancouver’s port, are critical transshipment and production hubs for Triad fentanyl producers and money launderers working in alignment with Mexican cartels and Iranian-state-linked criminals. Documents that surfaced in Ottawa’s Hogue Commission—mandated to investigate China’s interference in Canada’s recent federal elections—demonstrate that BC Premier David Eby flagged his government’s growing awareness of the national security threats related to fentanyl with Justin Trudeau’s former national security advisor.
A confidential federal document, released through access to information, states, according to the Canadian Security Intelligence Service (CSIS): “Synthetic drugs are increasingly being produced in Canada using precursor chemicals largely sourced from China.”
“Preliminary reporting by the BC Coroner’s Service confirms that toxic, unregulated drugs claimed the lives of at least 2,511 people in British Columbia in 2023, the largest number of drug-related deaths ever reported to the agency,” the record says. “CSIS identifies more than 350 organized crime groups actively involved in the domestic illegal fentanyl market … which Premier Eby is particularly concerned about.”
A sanitized summary on Eby’s concerns from the Hogue Commission adds: “On fentanyl specifically, Canada, the United States, and Mexico are working on supply reduction, including as it relates to precursor chemicals and the prevention of commercial shipping exploitation. BC would be a critical partner in any supply reduction measures given that the Port of Vancouver is Canada’s largest port.”
But before Beijing’s chemical narcotics kingpins took over fentanyl money laundering networks from Canada, the story begins in the early 1990s when fentanyl first appeared on American streets, according to a source with full access to DEA investigative files.
The initial appearance of fentanyl in the United States was linked to a chemist in Ohio during 1992 or 1993, they said. This illicit operation led to hundreds of overdose deaths in cities like Chicago and New York, as heroin laced with fentanyl—known as “Tango & Cash”—flooded the streets. The DEA identified and dismantled the source, temporarily removing fentanyl from the illicit market.
Fentanyl seemed to vanish from the illicit market, lying dormant.
The mid-2000s saw a resurgence, this time with Mexican cartels entering the methamphetamine and fentanyl distribution game, and individuals of Chinese origin taking up roles in Mexico City. “One major case was Zhenli Ye Gon in 2007, where Mexican authorities seized $207 million from his home in Mexico City,” The Bureau’s source said. “He was a businessman accused of being involved in the trafficking of precursor chemicals for methamphetamine production.”
Ye Gon, born in Shanghai and running a pharma-company in Mexico, was believed to be perhaps the largest methamphetamine trafficker in the Western Hemisphere. Educated at an elite university in China, he made headlines not only for his alleged narcotics activities but also for his lavish lifestyle. While denying drug charges in the U.S., he claimed he had received duffel bags filled with cash from members of President Felipe Calderón’s party—a claim that was denied by officials. His arrest also caused a stir in Las Vegas, where Ye Gon was a “VIP” high roller who reportedly gambled more than $125 million, with the Venetian casino gifting him a Rolls-Royce.
Despite high-profile crackdowns, the threat of fentanyl ebbed and flowed, never truly disappearing.
Meanwhile, in 2005 and 2006, over a thousand deaths on Chicago’s South Side were traced to a fentanyl lab in Toluca, Mexico, operated by the Sinaloa Cartel. After the DEA shut it down, fentanyl essentially went dormant again.
A new chapter unfolded in 2013 as precursor chemicals—mainly N-phenethyl-4-piperidone (NPP) and 4-anilinopiperidine (4-ANPP)—began arriving from China. This is when fentanyl overdoses started to rise exponentially in Vancouver, where triads linked to Beijing command money laundering in North America.
“These chemicals were entering Southern California, Texas, and Arizona, smuggled south into Mexico, processed into fentanyl, and then brought back into the U.S., often mixed with Mexican heroin,” the U.S. government source explained.
At the time, a kilo of pure fentanyl cost about $3,000. By 2014, it was called “China White” because heroin was being laced with fentanyl, making it far more potent. In February 2015, the DEA issued its first national alert on fentanyl and began analyzing the role of Chinese organized crime in the fentanyl trade and related money laundering.
The profitability and efficiency of fentanyl compared to traditional narcotics like heroin made it an attractive commodity for drug cartels.
By 2016, fentanyl was being pressed into counterfeit pills, disguised as OxyContin, Percocet, or other legitimate pharmaceuticals. Dark web marketplaces and social media platforms became conduits for its distribution.
The merging of hardcore heroin users and “pill shoppers”—individuals seeking diverted pharmaceuticals—into a single user population occurred due to the prevalence of fentanyl-laced pills. This convergence signified a dangerous shift in the opioid crisis, broadening the scope of those at risk of overdose.
The profitability for traffickers was staggering. One pill could sell for $30 in New England, and Mexican cartels could make 250,000 pills from one kilo of fentanyl, which cost around $3,000 to $5,000. This was far more lucrative and efficient than heroin, which takes months to cultivate and process.
This shift marked a significant turning point in the global drug trade, with synthetic opioids overtaking traditional narcotics.
By 2016, entities linked to the Chinese state were entrenched in Mexico’s drug trade. Chinese companies were setting up operations in cartel-heavy cities, including mining companies, import-export businesses, and restaurants.
“The growth of Chinese influence in Mexico’s drug trade was undeniable,” the source asserted.
Recognizing the escalating crisis, the DEA launched Project Sleeping Giant in 2018. The initiative highlighted the role of Chinese organized crime, particularly the triads, in supplying precursor chemicals, laundering money for cartels, and trafficking black market marijuana.
“Most people don’t realize that Chinese organized crime has been upstream in the drug trade for decades,” the U.S. expert noted.
When the COVID-19 pandemic hit in 2020, drug trafficking organizations adapted swiftly. With borders closed and travel restricted, cartels started using express mail services like FedEx to ship fentanyl and methamphetamine.
This shift highlighted the cartels’ agility in exploiting vulnerabilities and adapting to global disruptions.
By 2022, the DEA intensified efforts to combat the fentanyl epidemic, initiating Operation Chem Kong to target Chinese chemical suppliers.
An often-overlooked aspect of the drug trade is the sophisticated money laundering operations that sustain it, fully integrated into China’s economy through triad money brokers. Chinese groups are now the largest money launderers in the U.S., outpacing even Colombian groups.
“We found Chinese networks picking up drug money in over 22 states,” the source explained. “They’d fly one-way to places like Georgia or Illinois, pick up cash, and drive it back to New York or the West Coast.”
Remarkably, these groups charged significantly lower fees than their Colombian counterparts, sometimes laundering money for free in exchange for access to U.S. dollars.
This strategy not only facilitated money laundering but also circumvented China’s strict currency controls, providing a dual benefit to the criminal organizations.
They used these drug-cash dollars to buy American goods, ship them to China, and resell them at massive markups. Chinese brokers weren’t just laundering fentanyl or meth money; they also laundered marijuana money and worked directly with triads. Operations like “Flush with Cash” in New York identified service providers moving over $1 billion annually to China.
But navigating the labyrinth of Chinese criminal organizations—and their connectivity with China’s economy and state actors—poses significant challenges for law enforcement.
“The challenge is the extreme compartmentalization in Chinese criminal groups,” the U.S. expert emphasized. “You might gain access to one part of the organization, but two levels up, everything is sealed off.”
High-level brokers operate multiple illicit enterprises simultaneously, making infiltration and dismantling exceedingly difficult.
The intricate tapestry of Chinese fentanyl trafficking highlights a convergence of international criminal enterprises exploiting systemic vulnerabilities across borders. The adaptability of these networks—in shifting trafficking methods, leveraging legal disparities, and innovating money laundering techniques—poses a formidable challenge to Western governments.
The leniency in certain jurisdictions including Canada not only hinders enforcement efforts but also incentivizes criminal activities by reducing risks and operational costs.
As the United States prepares to intensify its crackdown on fentanyl networks, having not only politicians and bureaucrats—but also the citizens they are serving—understand the importance of a multifaceted and multinational counter strategy is critical, because voters will drive the political will needed.
And this report, sourced from U.S. experts, provides a blueprint for other public interest journalists to follow.
“This briefing will help you paint the picture regarding Chinese organized crime, the triads, CCP, or PRC involvement with the drug trade and money laundering—particularly with precursor chemicals and black market marijuana,” the primary source explained.
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Second lawmaker, his wife also shot; suspect remains at large
Two Minnesota state lawmakers who are members of the Democratic-Farm-Labor Party were shot early Saturday by a person posing as a law enforcement officer just north of Minneapolis.
House Speaker Emeritus Melissa Hortman and her husband were shot and killed in what Gov. Tim Walz called a politically-motivated assassination. The suspect, identified as Vance Boelter, 57, remains at large and a manhunt is ongoing. Authorities said he no longer is in the area of the shootings.
Gov. Walz on Shooting of Minnesota Legislators: ‘An Unspeakable Tragedy’. 6/14/25
Source: Minnesota Department of Public Safety
“My good friend and colleague, Speaker Melissa Hortman and her husband Mark, were shot and killed early this morning in what appears to be a politically-motivated assassination,” Walz said at a news conference. “Our state lost a great leader, and I lost a dearest of friends.”
State Sen. John Hoffman, DFL-Brooklyn Park, and his wife also were shot about 2 a.m., and Hortman and her husband were found about 90 minutes later.
Walz said the Hoffmans were each shot multiple times but he was hopeful for their recovery.
Law enforcement issued a shelter-in-place order for an area around Edinburgh Course that continued into the hours Saturday but has since been lifted. The suspect was seen wearing blue pants, a blue shirt, body armor, and reportedly driving a dark SUV with lights meant to make it appear like a police vehicle.
The suspect, Boelter, was appointed by Walz to serve on the Governor’s Workforce Development Board in 2019. Various media outlets reported that he is the director of Praetorian Guard Security Services, where he had access to police-like security equipment. Media outlets also reported that Boelter had a list of about 70 names in his vehicle which included the lawmakers who were shot, other lawmakers and abortion providers.
State officials are encouraging residents to not attend “No Kings” protests at the state capitol and across Minnesota. “No Kings” flyers were found in the suspect’s vehicle, law enforcement said.
Law enforcement at the scene of a shooting in Minneapolis
J.D. Davidson | The Center Square
The “suspect exploited the trust of our uniforms, what our uniforms are meant to represent,” Public Safety Commissioner Bob Jacobson said. “That betrayal is deeply disturbing to those of us who wear the badge with honor and responsibility.”
According to authorities, the gunman allegedly escaped through a back door of Hortman’s house following an exchange of gunfire with police.
President Donald Trump also released a statement on X, posted by White House Press Secretary Karoline Leavitt.
“Our Attorney General, Pam Bondi, and the FBI are investigating the situation, and they will be prosecuting anyone involved to the fullest extent of the law,” Trump said. “Such horrific violence will not be tolerated in the United States of America. God Bless the great people of Minnesota, a truly great place!”
The FBI said it is offering a reward of up to $50,000 for information leading to the arrest of Boelter.
Drew Evans, superintendent of the Minnesota Bureau of Criminal Apprehension, said Saturday that officers arrived at the Hortman residence as part of a routine check on lawmakers in the area and exchanged gunfire with the suspect, who managed to flee.
Brooklyn Park Police Chief Burley said officers knocked on the Hortmans door and were met by what appeared to be a police officer wearing police gear, a gun, a taser and a badge. Officers and the suspect exchanged gunfire in the home before the suspect fled out the rear of the house.
Burley also said the suspect was driving an SUV that looked like a police vehicle with lights. The car was impounded, and Burley said the suspect is on foot. He encouraged citizens to not answer the door for police officers and instructed Brooklyn Park police officers to not approach citizens alone, only in groups of two or more.
Burley said several people have been detained, and police are looking for others of interest.
Burley said a manifesto was found in the suspect’s vehicle that identified several other lawmakers. Both Hoffman and Hortman were on the list of people found in the car, Evans said.
Life-saving efforts were given to the Hortmans at the scene, Evans said.
“This was an act of targeted political violence. Peaceful discourse is the foundation of our democracy.We don’t settle our differences with violence at gun point. We must all stand against political violence,” Walz, also a DFL party member, said. “This tragic act in Minnesota should serve as a reminder that democracy and debate is a the way to settle our differences and move to a better place.”
The shootings happened seven miles away from each other, and law enforcement officials have called both shootings “targeted.”
Law enforcement was dispatched to the homes of several other state lawmakers – both Democrats and Republicans – in the Twin Cities area for protection overnight. Those lawmakers were told not to answer the door if an officer comes to it, but confirm with 911 before answering.
U.S. Sen. Amy Klobuhar, D-Minn., was shocked by the news.
“This is a stunning act of violence. I’m thankful for all the law enforcement who are responding in real time. My prayers are with the Hortman and Hoffman families. Both legislators are close friends and devoted to their families and public service,” Klobuchar said on social media.
Republican House Speaker Lisa Demuth, R-Cold Spring, called the shootings evil and asked for prayers.
“I am shocked and horrified by the evil attack that took place overnight. Please lift up in prayer the victims along with the law enforcement personal working to apprehend the perpetrator,” Demuth said on social media.
Walz activated the state emergency operations center early Saturday.
Hoffman was first elected to the Senate in 2012 and currently chairs the Human Services Committee.
Hortman was first elected in 2002 and was elected as speaker of the house in 2018. She is the current speaker emeritus.
She was also one of four DFL members to break with the party Monday and join Republicans to pass a state budget and end state health care services for noncitizens after a long and contentious special session.
The initial budget vote ended in a tie, before Hortman and three other DFL members broke ranks and joined Republicans to pass the legislation.
In a pair of sweeping investigations unveiled yesterday, the Ontario Provincial Police announced the largest fentanyl seizure in the force’s history—more than 43.5 kilograms of deadly synthetic opioids, including fentanyl, carfentanil, and precursor substances—enough to generate over 435,000 potentially lethal street doses. Nearly 20 suspects were arrested and more than 200 criminal charges laid in connection with the operations, codenamed Project Bionic and Project Golden.
The twin probes targeted sophisticated fentanyl trafficking networks that stretched across southern Ontario, extending northeast into the nation’s capital, Ottawa, and penetrating the national mail and courier systems. The seizures—made in locations ranging from Hamilton-area homes to Ottawa postal depots—come amid mounting warnings from U.S. security officials that Canadian territory is increasingly being exploited by Mexican and Chinese cartel networks, often intertwined with Iranian state-aligned trafficking and laundering operations.
The Bureau, a leading authority on North American fentanyl trafficking and Canada’s structural vulnerabilities, has reported extensively on Chinese-run illegal marijuana operations and cartel-affiliated smuggling corridors spanning British Columbia, Quebec, and Indigenous territories in southern Ontario. These networks operate near Hamilton and Six Nations and extend eastward through the Ottawa-Cornwall corridor to the New York State border, where key enforcement actions linked to Project Golden were concentrated.
OPP Commissioner Thomas Carrique called the busts historic in scope.
“Although these two investigations are independent, they both resulted in alarming seizures of fentanyl and reveal a complex level of drug trafficking,” he said at a press conference in Orillia. “These operations occurred at opposite ends of our province, which underscores that this is a province-wide public safety issue.”
“Between these investigations, there was a staggering 43 kilos of fentanyl seized,” Carrique added, “which equates to about 435,000 potentially lethal street doses.”
Launched in November 2024 by the OPP Covert Internet Intelligence Unit, Project Bionic was the force’s first major dark web narcotics probe. The investigation—led by the Organized Crime Enforcement Bureau—targeted a trafficking operation that processed high volumes of drug orders via encrypted marketplaces. Investigators found that packages were being shipped across Canada using both courier services and Canada Post. The digital reach of the network spanned nearly the entire country: Alberta, British Columbia, Manitoba, New Brunswick, Nunavut, Nova Scotia, Ontario, Prince Edward Island, and Quebec.
On Monday, March 10, 2025, OPP officers arrested two individuals at a Canada Post location in Ottawa and seized 86 packages containing various drugs ready to be shipped across the country. The raids yielded more than 27 kilograms and 64,000 tablets, representing 37 different illegal drugs and diverted prescription medications, including fentanyl, hydromorphone, methamphetamine, ketamine, MDMA, and others. Officers also seized $95,000 in cash, a firearm, and two stolen luxury vehicles. Among them was a stolen 2018 Ferrari 488 Spider convertible, valued at over $400,000. Investigators also recovered fraudulent licence plates and reprogrammable key fobs, highlighting the operation’s links to broader auto theft and financial crime networks.
Later that month, police recovered an additional 11 stolen vehicles. Four Ottawa-area individuals were arrested and now face a total of 85 charges.
Among those charged was 26-year-old Amr Hammami, who faces 56 counts under the Criminal Code and the Controlled Drugs and Substances Act. Charges include possession of prohibited firearms and ammunition, laundering proceeds of crime, and trafficking or possession for the purpose of trafficking in fentanyl, cocaine, methamphetamine, heroin, MDMA, ketamine, oxycodone, hydromorphone, alprazolam, and methylphenidate. Police allege Hammami coordinated drug shipments, managed laundering operations, and operated from within Ottawa’s urban core.
“Project Bionic exposed the alarming volume of dangerous drugs being sold through dark web marketplaces, with packages shipped across the country,” Carrique said. “These arrests show that law enforcement can track and stop even the most complex online trafficking operations. This investigation also plainly demonstrates the connections between drug trafficking and other crimes, such as auto theft and illegal firearms. This seizure is a major step in dismantling drug networks—whether online or on the street—and reflects the OPP’s ongoing commitment to public safety.”
The dark web refers to a portion of the internet not indexed by standard search engines. It requires specialized software to access and employs encrypted communication protocols to conceal users and platforms. Within it, marketplaces operate as anonymous forums for criminal transactions—trading in everything from drugs and stolen data to counterfeit pharmaceuticals and hacking tools.
Project Golden, launched in July 2024, tracked a sprawling fentanyl distribution ring with supply hubs in Hamilton, Oxford, Norfolk, Burlington, Mississauga, York, and Toronto. On May 28, police executed 16 coordinated search warrants targeting residences, businesses, and vehicles. They seized $5.4 million in narcotics, including 38 kilograms of fentanyl—the largest single fentanyl seizure in OPP history—alongside 19.5 kg of methamphetamine, 5.5 kg of cocaine, MDMA, psilocybin, three guns, three vehicles, and $121,600 in cash.
Fifteen individuals were arrested under Project Golden, facing 140 charges including conspiracy, trafficking, and weapons offenses. One of the central figures was 44-year-old Matthew Savory, who faces 70 charges, including two counts of trafficking carfentanil, and conspiracy to traffic in fentanyl, cocaine, and methamphetamine.
Despite the operation’s scope, Commissioner Carrique urged reporters not to fixate on whether the fentanyl was U.S.-bound. “There’s no indication the fentanyl was destined for the United States or any other country,” he said.
But The Bureau’s prior investigations suggest a more complex picture. In 2022, Montreal trafficker Arden McCann—known online as “The Mailman”—was indicted in the Northern District of Georgia for mailing synthetic opioids from Canada and China into all 49 U.S. states. McCann’s dark web network—located 192 kilometres from Ottawa, the Project Bionic dark web nexus—generated more than $10 million in revenue, using Canada Post and encrypted platforms—an operational model nearly identical to Project Bionic.
As part of that investigation, DEA agents and Canadian authorities seized two million counterfeit Xanax pills, five industrial pill presses, $200,000 in cash, 15 firearms, ballistic vests, and detailed ledgers showing transactions with Chinese precursor suppliers.
Investigators say the geography of southwestern Ontario—stretching from Hamilton to Six Nations and down to the Buffalo border—makes it a key strategic zone for cartel activity. The Bureau previously revealed a related cartel-linked bust on Six Nations reserve land, where counterfeit tobacco production and drug trafficking thrived in a jurisdictional grey zone.
The timing and location of Project Golden, coming shortly after the Six Nations-based Project Panda raids, suggest links. Both operations targeted the same narcotics distribution corridors between Brantford and Hamilton, uncovering fentanyl, firearms, and vehicles connected to high-level criminal networks.
The findings align with concerns raised by FBI Director Kash Patel, who recently warned that cartels were increasingly exploiting Canada as a fentanyl staging ground.
While the OPP emphasized the domestic impact of removing 43.5 kilograms of fentanyl from circulation, law enforcement experts warn that without structural reforms—including a Canadian anti-racketeering law, enhanced port and border surveillance, stricter chemical import tracking, and expanded financial intelligence enforcement—Canada will remain a vulnerable node in the transnational opioid web.
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