▶ 0:18:09more minutes here.
▶ 0:21:13right. Good morning. Committee on Homeland Security Oversight, Investigations, Accountability under the broader Homeland Security Committee will come to order. The purpose of today's hearing is to examine how China is using illegal marijuana to build a criminal network across America. Without objection, the chair is authorized to declare the committee in recess at any point. I now recognize myself for an opening statement.
▶ 0:21:39Uh today, the oversight investigations accountability committee is holding this hearing on how the use of illegal marijuana as tied into the criminal network tracing to China's impacting the United States. First, for order of business and announcement, uh the gentleman from Texas, Al Green, uh will from this point forward be serving on the oversight, investigations, and accountability subcommittee for the remainder of the 119th Congress, and we looked uh forward to working with him.
▶ 0:22:07We are here today to talk about an important issue, significant national security implications. This issue has been prevalent not just in Oklahoma, my home state, but in many other states, Maine, California, and all across our homeland. Um, let's paint the picture together. A group of Chinese nationals affiliated with foreign criminal crosses the southern border, makes their way into rural Oklahoma. With them are workers who have been lured under the false promise of good jobs in the United States.
▶ 0:22:38Once in Oklahoma, these Chinese nationals approach a local resident with an offer they cannot refuse. They offer the resident several hundreds of thousands of dollars. um using their time, their identity to purchase a nearby attractive land. In return, the resident gets to keep a share of the money with no questions asked. The deal is quick and it's simple.
▶ 0:23:03In a matter of days, this newly purchased land becomes the site of a large-scale illegal marijuana grow operation. The workers find themselves forced to work 14-hour days under the watch of armed guards, all while being confined to small living quarters, minimal running water or air conditioning.
▶ 0:23:20The smell of toxic fumes uh fumigation from pesticides that are lit on fire uh that we know have um caused major health consequences banned in this country are utilized for these grow operations. Hundreds of pounds of illegal uh contaminated marijuana is then produced, ends up in the hands of people all over the United States from Oklahoma to New York.
▶ 0:23:48This is just one example of how Chinese grow operations come to operation in communities all across the country. Oklahoma has had thousands of these operations activate at one time. Sadly, as we'll learn today, this is only scratching the surface of what these Chinese affiliated criminal groups are doing. many Chinese illegal operations service fronts for a wider criminal enterprise including human and drug trafficking, uh weapons smuggling and money laundering.
▶ 0:24:18And while the example I highlighted takes place in our home state of Oklahoma, similar patterns are repeated in other states like Maine, Massachusetts, California. In fact, there are thousands of these grow operations dispersed through our entire country, including tribal lands and national parks. We have an a really excellent panel of expert witnesses before us today who are going to walk us through this issue and how it affects the homeland security posture.
▶ 0:24:42Specifically, I'd like to focus our conversation on the serious crimes taking place inside of these illegal growth sites, as well as how Chinese transnational criminal organizations or TCOs, many with ties to the directly ties to the Chinese Communist Party, are setting up these sites all across the US as they expand an underground criminal network in our backyard.
▶ 0:25:03We are holding this hearing today because we've enabled these foreign organizations with potential links to the CCP to build up a sophisticated network throughout the United States which facilitates a wide range of other criminal activity and presents a national security threat. This is a convergence of organized crime, human drug trafficking, public health risks, all operating at scale and sophistication, crossing state, national lines beyond the normal capabilities of state and local law enforcement to combat.
▶ 0:25:33These agencies need the help of federal law enforcement to unravel these criminal networks. In fact, some of the foreign nationals running these grow operations are more heavily armed than local law enforcements. One of my field reps in Oklahoma heard from a journeyman electrician who was hired to do some work on a rural property. When he arrived at the site, he found what appeared to be a large forrun marijuana growhouse. And he personally observed an armory of dozens of assault rifles and ammunition crates.
▶ 0:26:02This network must be uncovered and eliminated from our homeland. And it's really that simple. The potential threat that come from having fully operational criminal associated with top foreign adversary on our soil is too great to ignore. I look forward to an informative and productive discussion. I now turn it over to ranking member Thanadar for his opening remarks.
▶ 0:26:28Good morning and thank you chairman and good morning to all of our witnesses Um, I want to welcome uh my colleague um, Congressman um, Al Green from Texas on this committee and uh, look forward to his um, contribution uh, to our uh, proceedings here.
▶ 0:26:53Now, if you take a stroll through DC's you're likely to encounter the National planting flowers or picking up trash and federal agents making traffic stops.
▶ 0:27:14This supposed crackdown on crime has also played out in Los Angeles, is unfolding in Chicago, soon coming to and being threatened by the vice president that they are on their way or coming to Detroit if needed.
▶ 0:27:38Trump's occupation of America's largest city is reducing the federal government's ability to pursue serious complex crimes. HSI agents have paused pursuing human DEA agents are not uncovering drug rings and FBI agents stopping financial fraud.
▶ 0:28:08Instead, they issue citations for open containers of alcohol, fair evasion, and traffic traffic offenses. The same federal agents who investigate money laundering and organize crime are also being deployed to Home Depot parking lots to arrest migrants looking for work.
▶ 0:28:38Who is investigating the thousands of illegal marijuana farms that currently exist in this country? And I'm not talking about someone who is growing a handful of pot plants consistent with their state's law and regulations.
▶ 0:28:56I'm referring to marijuana that is being grown by organized crime in our federal forest, business districts, and suburban neighborhoods, perhaps even at the house next door.
▶ 0:29:12These illegal grow sites are run by Mexican cart, Mexican cartels, Cuban drug traffickers, and increasingly Chinese organized crime.
▶ 0:29:27Just a few months ago, in my home state of Michigan, local law enforcement arrested four Chinese nationals after discovering over 5,000 marijuana plants worth around $5 million in a warehouse.
▶ 0:29:47The billions of dollars in proceeds from illegal marijuana help finance Chinese China's belt and road initiatives, a plan to wrestle global influence away from the United States through foreign investments in developing nations that the Trump administration has cut aid to.
▶ 0:30:09The illegal marijuana proceeds also fuel Mexican cartels that traffic deadly fentinil to the United States. The marijuana black market is right riddled with human trafficking, human smuggling, and forced labor. All too often, migrants are lured to farm with the promise of decent work.
▶ 0:30:35Once they arrive, their identification is taken away and they are forced to work 16 hours a day and live in substandard Illegal marijuana cultivation sites are also stealing our scarce resources such as water and electricity while poisoning public lands and banned toxic chemicals and pesticides.
▶ 0:31:04Illegal marijuana farms are a threat to our national security, human rights, and the environment. The federal government has had some successes through the organized crime drug enforcement and task force.
▶ 0:31:23For example, in January 2024, a federal jury found two Chinese nationals guilty of possessing and distributing marijuana over a 7-month period. They shipped 56,000 pounds of marijuana from Oklahoma to the east coast.
▶ 0:31:46In June 2024, the Justice Department charged associates of Mexico's Sinaloa drug cartel for conspiring with groups linked to Chinese underground banking to launder drug trafficking proceeds.
▶ 0:32:03Despite these wins and others, the Trump administration has proposed eliminating funding for the I am leerary that OC is being replaced with Homeland Security Task Force that will further elevate immigration enforcement at the expense of other law enforcement missions, including those best suited
▶ 0:32:33to tackle illegal marijuana. The multiaceted threats posed by illegal marijuana farms run by organized crime require a coordinated national strategy and the resources to carry out that strategy. I look forward to hearing from today's witnesses about the resources required of the federal government to snuff our illegal marijuana. Thank you all and I yield back, Mr. Chair.
▶ 0:33:04and the ranking member yields. Thank you uh to the other members of the committee. We are reminded opening statements may be submitted for the record. I'm pleased to have a panel of witnesses expert in their field before us today to speak this very important topic. I ask that our witnesses please stand and raise their right hand.
▶ 0:33:30Do you solemnly swear that the testimony you give before this the committee on homeland security of the United States will be the truth, the whole truth, and nothing but the truth. So help you God. Let the record reflect the witnesses have answered in the affirmative. Thank you, and please be seated. Um I would now like to formally introduce um our witnesses. Mr. Donnie Anderson is director of the Oklahoma Bureau of Narcotics, a native Oklahoma. Uh he has served in law enforcement for nearly three decades.
▶ 0:34:00Mr. Paul Larkin is a senior legal research fellow at the Heritage Foundation. He has worked in the federal government at the Department of Justice and the EPA's criminal investigative division, as well as the private sector as a public policy researcher. And our third witness, Mr. Uh Chris Urban is a managing director of Nardello and Company, a global investigations consulting firm and previously previously served as a special agent senior official at the Drug Enforcement Administration for 24 years. Thank you to all the witnesses for being here today.
▶ 0:34:31Uh I now recognize Director Anderson for five minutes for his opening statement. And I think that you traveled the longest from Oklahoma, Mr. Anderson, to be here. Thank you for being here.
▶ 0:34:42Thank you, Mr. chairman, ranking members, and members of the committee for inviting me to participate in today's hearings and your interest in Chinese owned marijuana farms. This topic is not of only a public safety interest, but also the interest of America's national security. My name is Donnie Anderson. I am the director of the Oklahoma Bureau of Narcotics. I've dedicated over 34 years of my life to public safety and drug enforcement in the state of Oklahoma. I can say without hesitation that the impact of black market marijuana in Oklahoma is unlike anything I've ever encountered in my career.
▶ 0:35:11What is even more alarming is the growing influence and involvement of the Chinese Communist Party in this illicit industry. Please understand that what I share today represents only a fraction of the broader threat we face. Several investigations remain open. I am unable to comment on them further without jeopardizing the integrity, endangering the brave men and women at the bureau who are investigating these cases or violating the laws to prohibit disclosure of active investigations.
▶ 0:35:35In 2018, Oklahoma voters approved medical marijuana state question 788 drafted by marijuana advocates. Unfortunately, the law imposed no limits on the number of grow operations or the quantity of plants each could cultivate. This lack of regulations led to a staggering over supply. Between March of 2024 to March of 2025, license and grow sites reported plants in the state of Oklahoma.
▶ 0:36:02Yet dispensaries sold just a little over 1.6 million pounds of marijuana in a in a dispensary. Given that one plant typically yields one pound of processed marijuana, over over 85 million plants are unaccounted for, representing an estimated 153 billion in missing product and proceeds. To put this in perspective, as of September the 9th, 2025, Oklahoma has 324,850 licensed medical marijuana patients.
▶ 0:36:32The scale of unreported inventory is deeply troubling, especially considering the black market producers routinely under reportport their plant count. Oklahoma's medical marijuana framework has inadvertently open the door to international organized crime. Criminal actors exploit the system to produce high potency marijuana for black market distribution, fueling what is now estimated to be a 153 billion illicit industry. A particular concern is a high prevalence of Chinese nationals involved in these operations.
▶ 0:37:02Their presence has has a profound effect on both our state and national security. Consider the following examples. In 2022, four Chinese nationals were executed in illegal marijuana farm near Hennessy, Oklahoma. A fifth individual was seriously injured. The operation used a fraudulent license obtained via a straw ownership. April of 2024, law enforcement arrested multiple suspects in connection with a robbery and homicide at a grow site. in Noki County in Oklahoma. The victim, 53-year-old Harry Dan, was fatally shot.
▶ 0:37:31July of 2025, a Canadian national was found murdered execution style at a grow operation near Lake Thunderbird, just east of Norman, Oklahoma. The death is believed to be the result of a tra targeted robbery. The investigation remains ongoing currently. These incidents are just a few among many. Beyond these murders, state authorities have documented a sharp rise in violent crime linked to black market marijuana operations masquerading as legal enterprises.
▶ 0:37:56The Oklahoma Bureau of Narcotics reports associated crimes including human and sex trafficking, money laundering, illegal gambling, extortion, theft of water and electricity. Our agency currently employs one Mandarin speaking agent. However, this is insufficient when suspects communicate in Cantonese and Fujian, languages that Mandarin speakers cannot reliably translate. Comp compounding this issue is the widespread use of WeChat, a Chinese-owned platform used for both communication and financial transactions.
▶ 0:38:24Because WeChat is based in mainland China encrypted, US law enforcement cannot serve legal process or conduct electronic surveillance as we would with domestic platforms. This these apps fall outside the scope of the Communication Act of 1996 and Electronic Communications Privacy Act of 1986, making them a major obstacle in our investigations. Oklahoma law requires marijuana business owners to be state residents with at least two years of residency.
▶ 0:38:51Yet nearly all Chinese operated grows circumvent this requirement through fraud and straw ownership. In one instance, a single Oklahoma was listed as the owner of approximately 300 marijuana farms in Oklahoma. This widespread fraud is facilitated by consulting firms, real estate agents, and attorneys who help establish these shell operations. Alarmingly, many of these groves are located near critical infrastructure, including military bases and pipelines.
▶ 0:39:15For example, in an ongoing investigation, the Department of Defense reported suspicious activity at a marijuana grow operated by an ethnic Chinese group located adjacent to the Mallister ammunition plant. This ammunition plant is the largest in the United States that is also responsible for manufacturing the MOAB massive ordinance air blast bomb and h and houses close to the third of the department it maintains a third of the department of defense's munition stockpile. That's where it's at in in Mallister Oklahoma.
▶ 0:39:45This is no doubt the Chinese government has shown interest in Oklahoma's marijuana authority. We have documented financial transfers to the Bank of China and connections to businesses owned by the Chinese government. These concerns have amplified by recent reports of CCP activity and operations like Salt Typhoon, which my agency was directly affected. Regardless of property ownership, it is my belief that the CCP maintains access to these sites, particularly through its known practices of controlling expatriots via so-called police stations.
▶ 0:40:14Thank you for your time and attention to this critical issue. I'm available to answer any questions you may have or to provide additional information as needed.
▶ 0:40:24Thank you, Mr. Anderson. I now recognize Director Larkin for 5 minutes for his opening statement. For 60 years, one of the primary arguments made in favor of the legalization of cannabis is that it will eliminate the black market. The rationale given was that people would prefer to avoid criminal prosecution for using cannabis and they would like to purchase it from a store with a quality reputation and a quality product.
▶ 0:40:53Over the last 5 to 10 years, we now know that that argument is a fugazi. The black market has not disappeared, even though a majority of states in the United States now have approved either medical or recreational use marijuana programs. In fact, the problem that you have taken up is a matter not just of public health, which is the way cannabis issues are normally thought of. It's a matter of domestic or homeland and national security. Why?
▶ 0:41:23The businesses that we see across the nation selling cannabis for medical or recreational purposes are not run by 50s era beatnics or 60s era hippies. They are run by Chinese organized crime with a tacit knowledge and acquiescence by the people's republic of China and the Chinese communist party. Two entities that are sworn enemies of the United States.
▶ 0:41:47That raises a clear homeland and national security aspect of this problem that has been under discussed in all the debates over cannabis legalization. This is a serious problem. According to the Whitney Economics Organization, the cannabis market is a 100 billion dollar industry. 75% of it is the illegal market and twothirds of the cannabis sold in the United States is grown domestically.
▶ 0:42:16So we're talking not just about somebody who is growing five plants in a home in connection with and as authorized by a state law. We're talking about people growing massive quantities who are part of an organization that has nothing but uh the worst interests of people in our neighborhoods in mind. I mean the existence of this black market is recognized by numerous parties.
▶ 0:42:43Senator Joanie Ernst and 49 other members of Congress sent a letter to uh then Attorney General Merrick Garland asking him to look into this. There have been numerous other organizations and think tanks that have written about it and there are uh buku media stories written print uh or uh in the TV media on this.
▶ 0:43:07They all agree that this is a serious problem because it is not simply the illegal distribution of controlled substances that is at issue. It is all of the associated crimes that occur. As the ranking member pointed out, we'll see money laundering, human trafficking, prostitution, fraud, uh, and various types of violent crimes, including homicides.
▶ 0:43:35As my colleague has pointed out, all of these damage our local communities. But it's not just that. The money that uh, Chinese organized crime made from illegal fentinel sales has helped underwrite their cannabis business in the United States. and the money that they make in the current operations can be used to spread those operations into other states and other areas as well as for other purposes that are do not have the best interest of the United States in mind.
▶ 0:44:04Now, if this were just simply a smallcale matter rather than a coast to coast matter, it might not merit the attention of anything other than the legislators, the executive branch, and law enforcement in those states and neighborhoods. But it is in fact from coast to coast from Maine to California and Oklahoma which is probably halfway between has seen a very serious problem as for the reasons my colleague gave because there is unlimited grows allowed in that state.
▶ 0:44:35Now as I mentioned before this is not simply a problem of domestic people uh that have broke bad. The Chinese organized crime elements are working with the tacet knowledge and acquiescence of the PRC and CCP. Now that does the law does not require a formal agreement amongst those parties in order for them to be held criminally liable.
▶ 0:44:58As I have explained in some of my writings, the conspiracy laws allow someone to put together a case based on various types of circumstantial evidence of which there is an ample amount here. What we have is a national problem involving a drug that unfortunately is seen as being milder in some ways than others and pharmacologically in many respects it is.
▶ 0:45:27But cannabis is very harmful if you use it on a long-term basis or in very serious doses. I am glad that you're holding this hearing and I'm glad to answer your questions.
▶ 0:45:38Thank you, Mr. Larkin. Um, Mr. Urban, you are now recognized for your five minutes. Committee Chairman Garberino, Committee Ranking Member Thompson, Ranking Member Than Theodor, and distinguished members of this subcommittee, thank you for the opportunity today to address you on the growth of Chinese organized crime in the United States and the role of marijuana cultivation and distribution in facilitating that growth.
▶ 0:46:05During my 24-year career uh with the DEA as an agent and executive, I saw firsthand the damage done by transnational criminal organizations, TCOs, and the increasingly significant operations of Chinese transnational criminal organizations.
▶ 0:46:21Over the last five years of my career, I led a team at DEA's special operations division, SOD, dedicated to an operation called Project Sleeping Giant, which sought to understand, identify, target Chinese organized crime operating in the United States and abroad.
▶ 0:46:39We were particularly concerned about the rise of Chinese moneyaundering networks, which have transformed narcotics trafficking by offering dramatically lower rates, lower risk, and quicker return of funds than the networks that had previously laundered those funds. Project Sleeping Giants objectives included understanding the Chinese organized crime threat, developing intelligence on it, and designing enforcement operations to mitigate it.
▶ 0:47:08As a result of the investigative and intelligence gathering operation, we learned that Chinese organized crime was involved in a wide range of criminal activity globally, including being the Chinese suppliers of precursor chemicals used in fentanyl production in Mexico, becoming the primary money launderers for the Mexican cartels, which have been res recently designated as FTO's, human trafficking networks, global operations that corrupt government authorities, wildlife trafficking, trafficking networks
▶ 0:47:38and of course Chinese controlled marijuana cultivation within the United States. So what have the Chinese moneyaunderers done with the proceeds of their criminal activity? Starting in 2017, when a wave of marijuana legalization was sweeping through the United States, we started seeing the profits of the laundering of Mexican cartel proceeds get invested into marijuana cultivation and distribution operations by Chinese moneyaunderers.
▶ 0:48:08The speed and organization in which the Chinese controlled marijuana grows were established was nothing short of remarkable. As the Chinese moneyaunderers provided, the funding for the grows trafficked Chinese citizens into the United States to live at the grow locations, tending to the plants on a 247 basis. They then traffic the marijuana to cities for sale. All of this happened seamlessly.
▶ 0:48:30It was extremely well organized because it was being managed by Chinese organized crime and Chinese money launderers at the leadership and command and control What is the best way to combat the threat? First, there is a critical need for local, state, and federal officials to recognize that activities, including Chinese marijuana grows and distribution operations, are not just weed cases.
▶ 0:48:54They are harmful in and of themselves, and they also help fuel Chinese moneyaunderers, and organized crime linked activity such as human trafficking, fentanyl distribution, and other dangerous harmful activities. These cases should be prioritized as they are linked to the larger criminal networks. State and local governments individually do not have the necessary resources and authorities to attack and dismantle Chinese marijuana trafficking networks.
▶ 0:49:23State and local governments typically lack the subject matter experts, language skills, data scientists, confidential sources, and other law enforcement capabilities that are needed to address the threat. Federal funding, coordination, and authority combined with state and local resources, intelligence, and their authorities is desperately needed.
▶ 0:49:44It is essential to use the federal racketeering, money laundering, continuing criminal enterprise prosecutions to target the leadership and command and control levels of these operations, similar to what we did in the late 80s and 90s against Italian organized crime.
▶ 0:50:02for uh organized crime leaders, Chinese organized crime leaders need to understand that the federal government will aggressively target them with severe consequences using other federal authorities to target the related crimes such as human trafficking, money laundering, tax evasion, mortgage fraud, as well as state and local laws and regulations governing the cultivation operations themselves and those governing land power use uh and water violations will have a material impact.
▶ 0:50:29Lastly, even at the federal level, specialized task forces are needed to effectively target Chinese moneyaunderers, Chinese organized crime engaged in marijuana trafficking activity. A fully funded intergovernmental platform will allow for law enforcement to better identify the criminal networks and dismantle them state by state. Congress can play a vital role in providing resources, ascent incentives, and authority to the federal government. Thank you for the opportunity today to engage in this Thank you, Mr.
▶ 0:50:59Urban. Members will be recognized by seniority for five minutes of questioning. Additional rounds of questioning may be called after all members had the opportunity. I now recognize myself for five minutes of questioning. Um, Director Anderson, can you describe how Oklahoma has become a hotbed for illegal marijuana grow operations? And can you put that in context as it as it is compared against the other 49 states?
▶ 0:51:32Well, what happened with Oklahoma was one, Oklahoma is a very rural state, has a very has a lack of resources when it comes to public safety. We also have very cheap farmland. Um, so we also have the the most liberal marijuana laws in the union. So whenever Oklahoma enacted the medical marijuana statute that we passed, uh it opened up Pandora's box for Oklahoma.
▶ 0:51:56So what you had you had a very organized group of Chinese nationals who who actually this isn't just in the US, they're global with what they're doing. But they own the market of marijuana. They they actually took a market that was was the number one cash drug crop for the cartel and they own that and they've owned that for a few several years now. They move those operations because of crackdowns that were going on in New Mexico and California to Oklahoma. One, because it is rural. Two, the land is very, very cheap.
▶ 0:52:26Um, what you can buy 80 acres in Oklahoma, what you can buy a block for in California with our laxed laws. That is exactly what happened in Oklahoma.
▶ 0:52:40Uh, Mr. Durban, you mentioned a minute ago, if I remember hearing you correctly, that 300 billion is what you all have seen is the uh 2025 number of illicit illicit uh marijuana being moved across the United States. Did I understand that stat correctly? 300
▶ 0:52:57I believe that's correct. It was in my my written statement. So, I believe the time period, it's a massive amount of
▶ 0:53:02In tandem with what Mr. Anderson is talking about when they're looking at the amount of plants in Oklahoma.
▶ 0:53:08Compared that they have registration on compared to what they know they're able to produce and what's been unreported. Oklahoma alone believes they have a $150 billion per year illicit marijuana industry. To put that in context, the state budget of Oklahoma to run all areas of governance from the state level in Oklahoma is 13 billion. 10 times the state budget is the illegal activity of marijuana.
▶ 0:53:34And it's why it's sadly become, and I hate this, for my state, a leading exporter of marijuana in this nation, illegal marijuana export. It's almost half of the number that I think that the DEA is looking at. And that's just it's just astounding. Um, Director Anderson, what kind of of um um response are we getting in Oklahoma in terms of knowing that what's opened this thing up?
▶ 0:53:59What what do you think that it's going to take for the average person in Oklahoma to realize this is such a problem and that this is not something that we can as as you site the homicides in Hennessy? We've got Mallister ammunition plant that there's some activity adjacent to it where onethird of all munitions for this country come for in Mallister Oklahoma the congressional district that I represent munitions for our national defense and Chinese nationalists adjacent to it that we're there's some concern about illicit activity.
▶ 0:54:26What is it going to take for Oklahoma um for the grassroots that ultimately drives manifest itself where the legislature then makes some changes? What does the law enforcement have to do to get the attention of of Oklahoma officials?
▶ 0:54:41Thank you for the question. I wished I knew the answer to that because I've been trying for five years. Um, I I will say we are starting to gain traction now as far as global or nationwide what's going on in Oklahoma because literally what's going on on in Oklahoma whenever I talk about the 85 million pounds that's unaccounted for that's going across the US and and understand that's that's what we know is there. That's there's no telling how much that really is.
▶ 0:55:09Um because if we know there's 85 million unaccounted for, is there another 85 million or 100red billion that we don't know about? Because typically when we when we go into these operations, they don't have metric tags on them. They tag a few. Uh you may have 30,000 plants, they may have a thousand of those tagged. So there's a lot more that's not tagged than there than there there is tagged, but I do think we're making making some headway as far as letting people know what's going on.
▶ 0:55:37And for me, this isn't about I want to be very clear. This isn't just about marijuana. I'm not talking about mom or pop operations or even about people who utilize marijuana for for whatever medical purpose they use it for. I'm talking about real organized transnational criminals who do not have our best interest at heart. When I say our best interest, I'm talking about the American people as a whole.
▶ 0:56:03So that is my biggest concern with what's going on with this whole catastrophe in Oklahoma for his five minutes of questions.
▶ 0:56:14Thank you, Chairman. Uh look, drug cartels and criminal organizations, including those from Mexico, Cuba, and China, are illegally cultivating marijuana across the United They're often disguised their illegal operations by hiding in states where law-abiding growers operate.
▶ 0:56:41But these marijuana grows are dangerous. They rely on human trafficking or cheap labor and sexual exploitation. They steal water and energy from surrounding communities.
▶ 0:56:59They sew the grounds with pesticides and chemicals that seep or run off into our water and they spray the marijuana with chemicals that end up being consumed by people here in the United States. Mr. Mr.
▶ 0:57:17Urban, how should the federal government respond to illegal marijuana especially when it comes to combating international criminal organizations that are operating across the United States?
▶ 0:57:36What does a whole of government approach looks like from your So from my experience sir, I mean you laid out all the variety of crimes and and and activity that was taking place in these cultivation areas. I think it's it's very simply we need to mandate a solution from the federal government. We need to provide the funding for example Mr. Anderson in Oklahoma.
▶ 0:58:03What I would suggest is we need to target the network and defeat the whole network. So you can use Chinese organized crime as example, but you could also lay, you know, other organized crime elements in this, but we'll we'll stick with Chinese organized crime right now. Federal funding, a task force that would target that entire network operating in the United States The funding is expensive for personnel and overtime, as Mr. Anderson would probably uh attest to.
▶ 0:58:28Uh there's air and land assets that you need, but we need a federal task force comprised of DEA, HSI, FBI to include their counterintelligence side because there is an encounter intelligence component to this, IRS, Fish and Wildlife, and then again successes that we've had in the past partnering with state and locals who have the expertise and intelligence and knowhow on the ground and using their authorities. It's a national security issue.
▶ 0:58:56The task force funding would employ essentially a platform of these federal agencies combined with subject matter experts, translators of various Chinese dialects, in this example, data scientists and targeters, funding to recruit confidential sources, and also coordination with state and local prosecutors. The mandated task force would target them with federal prosecutors as well. Thank you. And thank you, Mr. Urban.
▶ 0:59:25The the Chinese have become the dominant players in illegal marijuana cultivation. But they are not the only players. How do we make sure the federal government is able to help state, local, tribal, and territorial law enforcement combat the big guys, the Chinese criminal organizations as well as the smaller players?
▶ 0:59:51Look, in Michigan earlier this week, a 50-year-old man was arraigned on charges of tax evasion related to an illegal marijuana grow operation that he ran for 2 years. When his home was searched, police found more than 1,000 marijuana plants and 50 pounds of processed marijuana.
▶ 1:00:16Just two months ago, Michigan State Police seized more than 10 million worth of marijuana at an illegal marijuana grow operation. That grow operation was in a 17,000 square foot warehouse situated on 19 acres. And in June, four Chinese nationals were arrested in Michigan for growing $5 million worth of illegal marijuana. Mr.
▶ 1:00:45Urban clearly illegal marijuana grow operations are profitable business and they are hidden in plain sight. What obstacles do federal, state and local law enforcement face when trying to combat illegal marijuana grows? What can Congress do to help find prosecute these farms and those who operate them?
▶ 1:01:10So great question and continuing on from from the first question, the establishment of this task force would be paralleled by federal and state prosecutors that would utilize like I mentioned earlier the racketeering continuing criminal enterprise and moneyaundering laws to target command and control leadership at the highest levels in terms of the organized crime groups the Chinese operating in this area. The task force would also have tactical ability to move from state to state and enforce the law.
▶ 1:01:41Thank you, Mr. Arman. My time is off and chairman back.
▶ 1:01:45The gentleman yields. I uh now recognize Miss Green from Georgia for her five minutes of question.
▶ 1:01:51Uh before my five minutes, Mr. Chairman, I ask unanimous consent to enter for the record um this article, Triad Weed, how Chinese marijuana grows took over rural Maine. Uh this is an article that highlights how Chinese TCOs are are basically taking over Maine uh via these illegal grow farms. Without objection, so ordered.
▶ 1:02:15Thank you, Mr. Chairman. Um according to I apologize, CBP encountered record numbers of Chinese nationals crossing the border under the previous Democrat During the last four years, there were over 170,000 Chinese nationals who were encountered nationwide, most of whom were caught crossing between the ports of entry.
▶ 1:02:40This does not include the potential Chinese nationals that are among the two million gotaways who completely evaded US authorities or now and now are roaming um American communities. Open border policies have consequences and America's paying the price. In 2024 alone, there were nearly 79,000 Chinese nations encountered at the border. This is up from an average of only 1,500 a year over the previous decade.
▶ 1:03:10The majority of Chinese illegally entering the US were single military age men. people, Chinese nationals, is equivalent to more than 176 US army battalions. Or put it another way, they total more than 35 army brigades or nearly 12 divisions or nearly four cores or three army three field armies.
▶ 1:03:39That's how we can translate that just for people's understanding. According to the DEA, Chinese TCOs have become dominant in the US elicit marijuana market, establishing highly sophisticated multi-state operations. In New Mexico, a recent federal indictment exposed a 25 uh acre farm, 400 acre cultivation scheme on Navajo Nation lands tied to Chinese investors and recruited labor, resulting in the seizure of more than 260,000 plants, 60,000 pounds
▶ 1:04:09of marijuana. The networks integrate profits from cannabis into fentanyl trafficking, human smuggling, and global money laundering schemes, creating significant national security challenges. Just as our witnesses have stated today, the American people don't know about this. This is uh, you know, largely believed, especially in younger generations, that marijuana is a good thing, that it it helps relieve stress, helps them sleep at night.
▶ 1:04:36Um, and then there's also people that use it for PTSD and and have success with it. There's medical uses of marijuana, but the American people have no idea that uh Chinese transnational criminal organizations are involved and that it's leading to other extremely terrible and dangerous crimes and fentanyl. Honestly, uh, Director Anderson, how do these Chinesebacked illegal marijuana operations run?
▶ 1:05:06H how for the regular American, they're going, "Well, how is a crime organization from China able to run a marijuana farm?
▶ 1:05:16These are very, very sophisticated." When I say sophisticated, this is at a level that law enforcement across the nation has never seen before because they are that sophisticated and that complex. They're layered and they're hidden under many many layers of LLC's and ownerships. Um, when you begin to look for, for example, in Oklahoma, you may have a John Smith who is the owner, the 75% owner of the Marijuana Grow. And as you dig through that thing, John, you'll find out that John Smith has never even been to the Marijuana Grow.
▶ 1:05:44John Smith was paid $3,500 to put his name on a license because the Chinese National can't do that in the state of Oklahoma. And that's how that happened in Oklahoma. But these you you have people in Fleshy, New York, and in California that run a lot of stuff across the whole US that may not ever step foot in the state of Oklahoma other than to make a visit every once in a while, but these are very well organized, very sophisticated, and it's not, and whenever I talk about this, this
▶ 1:06:15is really a global thing that's going on with the Chinese nationals. If you look at what's going on down in Latin America, what the Chinese doing down in Latin America, even to the Caribbean, they're building roads. I mean, they're really invested in this stuff. But that there's a reason why this is going on. Once again, this comes right back to the US, to the national security and what's going on in as well as to Oklahoma. But you're right, I don't think the majority of the people in the US realize what's going on.
▶ 1:06:42People People in the marijuana industry really hate on me. They think I'm just against marijuana, right? Not it has for me it has nothing to do with marijuana. If someone wants to ingest marijuana, that's their business. For me, it has everything to do with the transnational criminal organizations who are doing things such as trafficking in very large amounts of marijuana. They are laundering billions, not millions.
▶ 1:07:08Oklahoma's probably over a hundred, well over hundred billion dollars just for Oklahoma. the murders, the sex trafficking, which is probably one of the most deplorable things that we have to deal with. H
▶ 1:07:19how are we treating other humans like this? I just I just don't get it. But the rest of the US probably don't know really what's going on. And it's not just Oklahoma. Yeah, Oklahoma's kind of the epicenter of kind of what's going on right now because we do have such a liberal marijuana law, but the sex trafficking, the violent crimes, the underground casinos, the underground banking is going on all across the US.
▶ 1:07:42Wow. Thank you. I'm sorry I'm I'm out of time, Mr. Chairman. We need to explore how we can help state uh and federal work together to trace the money and track this down. Thank you.
▶ 1:07:54Gentle lady yields. I now recognize uh Miss Ramirez for her five minutes of
▶ 1:07:59Thank you chair and ranking member. Before we get started, chairman, I want to ask unanimous consent to include into the record children of couple taken by ICE and Cicero road stop speak out and what happened to Sylvio Viegas Gonzalez.
▶ 1:08:16So sorry
▶ 1:08:17I can do it again
▶ 1:08:18without objection. So so ordered.
▶ 1:08:20Thank you chairman. This is our oversight committee and I think it's important to use every opportunity here to do the oversight work. I want to thank the panelists that are here, but I need to talk about what's happening here right now all over the country. And I want to start by saying that the Department of Homeland Security is a national security threat. I call it a force terrorizing communities with good reason.
▶ 1:08:43Men in masks, unmarked cars, no badges, no body cameras, and arrests without valid warrants all result in fear, chaos, and harm. And given that this is a subcommittee on oversight, I want to show two clips today. One clip shows DH DHS agents engaging children whose family members were just abducted.
▶ 1:09:08And the second clip you're going to see today shows the murder of Sylveas Gonzalez by DHS agents. Let's watch the Where's all my family?
▶ 1:09:26They're in here. What's your brother? Is he a citizen?
▶ 1:09:30Um, we don't answer questions.
▶ 1:09:32If If you tell me he's a citizen, we'll let him go.
▶ 1:09:35We don't answer questions. Look at what you're doing.
▶ 1:09:38Hear the cries of the kids.
▶ 1:09:39If you tell me he's a citizen, we'll let him go.
▶ 1:09:41We're not We don't answer questions. I'm
▶ 1:09:45He has your phone number, right?
▶ 1:09:47He'll call.
▶ 1:09:47All right. That's fine. Come on. And what's happening to our car?
▶ 1:09:57I I How can
▶ 1:09:59Can you raise the volume?
▶ 1:10:02How am I supposed
▶ 1:10:04How am I supposed to take it?
▶ 1:10:06You can You can take it. That's the key. We can take it.
▶ 1:10:10Hear the cries.
▶ 1:10:11Don't cry. Don't cry. Okay. It's okay. Don't cry.
▶ 1:10:15Don't cry.
▶ 1:10:17Look, this what I need to understand. I just need somebody to I just need somebody to talk to me. Okay.
▶ 1:10:20It's okay.
▶ 1:10:21Listen. I just need somebody to talk to.
▶ 1:10:22It's okay. We're okay.
▶ 1:10:23Okay. Listen.
▶ 1:10:24I don't want to talk.
▶ 1:10:24No, no, no. They said they got to take the car. Who's the daughter? Is it you or you?
▶ 1:10:28All of us.
▶ 1:10:29Okay. This is what I need to understand.
▶ 1:10:31That's your brother, right?
▶ 1:10:32That's my brother.
▶ 1:10:32Is she born here? Yes or no?
▶ 1:10:34We don't answer questions until our lawyer is listen.
▶ 1:10:38That's it.
▶ 1:10:38Okay. I'm trying to help you out here. I did it already. We got
▶ 1:10:41Yeah, it's fine. We can talk when our lawyer is here. Don't worry. It's okay.
▶ 1:10:45Don't talk here.
▶ 1:10:46Yeah. It's okay. Come on. It's okay. It's okay. It's okay. Okay. It's okay. It's okay.
▶ 1:10:52Video from this morning shows two ICE agents conducting a vehicle stop. The agents surround the silver car. The driver reverses the vehicle. The officer on the passenger side can be seen pointing his weapon as the driver attempts to flee the scene. As the car drives away, the agent on the driver's side can no longer be seen in this video.
▶ 1:11:12In a different surveillance video, two gunshots can be heard as the vehicle drives away Let's break it down. In the first video, ICE says the lie. ICE encountered a mother and her two children who weren't detained and then kept asking, "Are they citizens?
▶ 1:11:40If you have a warrant, if you know that they're not citizens, why are you asking if they're citizens? Here's the facts. Eyes detained a mother, a father, and their son, a college student that's a dreamer. They encountered the couple's three other children, and aggressively questioned a 12 and 10year-old. Given that we know that the parents had no public criminal record, how did DHS agents know to pull them over? We know it's because they're brown.
▶ 1:12:09I cannot imagine a parent in this room who would accept their children being questioned without an adult. And if any of my colleagues are at peace with watching that little girl cry, you know what? Miss me with your family values. In the second video, the lie, that ice statement, he dragged an ICE The footage, the fact no one was dragged. The lie he drove at agents.
▶ 1:12:38The fact he drove away from agents. The lie. Use appropriate force. The fact the agent shot Sylveio dead. The lie. Sylveo had a history of reckless driving.
▶ 1:12:58Are the cameras not on? The camera should be on. I mean, I know we're filming. The fact is he had just one moving violation in May 2023. A traffic violation should never amount to a death sentence. We need a full and thorough investigation into what
▶ 1:13:15One moment. Is the public seeing this? Chairman, is the public seeing this? Are the cameras on? Okay. If if you can go ahead and return my time. I think I was at about 30 seconds when we asked about the camera. I'll wait. If it's okay, chairman, I'll finish my 30 seconds in here. Uh,
▶ 1:13:40the gentle lady will hurry.
▶ 1:13:41I want you to look at that face. Ser was shot. He was the father with full custody of these two children. He was shot after he was followed dropping off his child at daycare. We need a full thorough investigation. And every single death and separation, every orphan created as Christine Gnome's responsibility. It is why, Mr.
▶ 1:14:02Chair, pursuant to clause 2K6 of rule 111, I move that the committee subpoena Secretary Christy Gnome.
▶ 1:14:17I now recognize Representative Strong for his
▶ 1:14:20Mr. Chairman. I I I
▶ 1:14:22Thank you, Chairman McKe for holding these hearings today. I've already seen how the
▶ 1:14:26Mr. Chairman, I need a response to my request of a subpoena. I didn't get a delay will state her motion again.
▶ 1:14:36Mr. Chair, pursuant to clause 2K6 of rule 11, I move that the committee subpoena Secretary Christy Gnome.
▶ 1:14:52All right, the committee will stand in
▶ 1:29:19All right.
▶ 1:29:26Committee is will be uh in order resuming. Uh gentle lady had a motion on the table.
▶ 1:29:34A motion. Chairman motion to table
▶ 1:29:36and gentleman has now indicated his desire to table that motion.
▶ 1:29:41I second.
▶ 1:29:42The gentle lady has second it.
▶ 1:29:48All those in favor of tableabling the motion signify by saying I.
▶ 1:29:54All oppose nay.
▶ 1:29:57Uh mo the eyes have it.
▶ 1:29:59I think I do.
▶ 1:30:00Mr. Chairman, I request a recorded vote.
▶ 1:30:02Recorded vote is requested. Clerk will call the role.
▶ 1:30:10Miss Green
▶ 1:30:13Miss Green votes I. Mr. Strong
▶ 1:30:16Mr. Strong votes I.
▶ 1:30:19Mr. Ogles
▶ 1:30:21Mr. Ogles votes I.
▶ 1:30:27Mr. Not I.
▶ 1:30:29Mr. Not votes I. Mr. Garbino Mr. Tanadar
▶ 1:30:36Mr. Tanadar votes no Mrs. Ramirez
▶ 1:30:40Mrs. Ramirez votes no Mr. Carter
▶ 1:31:53How's the chairman recorded? Chairman has not yet been recorded.
▶ 1:31:57Chairman votes I.
▶ 1:31:59Chairman Been votes I.
▶ 1:32:03Mr. Carter has not recorded.
▶ 1:32:08Carter votes no.
▶ 1:32:10Mr. Carter votes no. Mr. Green of Texas. Ranking member Thompson.
▶ 1:32:18Any other members? Not voted. Clerical report.
▶ 1:32:24Mr. Chairman, on that vote there were five eyes and three nos.
▶ 1:32:28The eyes have it. Motion to table is adopted. All right, we are back on the agenda. Um, I now recognize uh the gentleman from Alabama for his five minutes of questioning. Thank you, Chairman McKeen, for holding this hearing today.
▶ 1:32:47We've already seen how the CCP took advantage of the open border policies of the previous administration to provide precursors uh to fentanyl that have wre havoc all over this nation and all over the world in an effort to kill a generation of Americans, not Republicans, not Democrats, but Americans. The Mexican cartel cannot make fentanyl without the precursor uh from China.
▶ 1:33:14These ille the these illegal marijuana farms are another example of how brazen the CCP will be. Earlier this week, we talked about how foreign adversaries see uh see US agriculture not only as an economic target but also a homeland security vulnerability. Mr. Larkin, how significant is land acquisition to the uh broader strategy of uh Chinese criminal groups operating in America?
▶ 1:33:44It's helpful to them.
▶ 1:33:47It's helpful to them in two very different ways. First, it allows them to use the property to grow elicit drugs, to process them, and then use that site as a distribution point. Uh, but it's also possible to do that in places that would allow them uh to try to use that area for spying on nearby facilities.
▶ 1:34:07For example, if you had an indoor rather than an outdoor grow, you could not only use that as a basis for developing marijuana that can you can then ship elsewhere in the state or across the nation, you can also use that as a place perhaps for spying on nearby Americans or American bases or other sensitive targets. So, it's it's a very dangerous sort of circumstance we have.
▶ 1:34:32I think you're exactly right. You start thinking about it. I asked the state department, "How many acres does China own or lease in America?" Some time back, might have been a year or two. And I remember they said, "We'll get back with you." Then all of a sudden, we found out 380,000 acres are either owned or leased by China of American soil. Then we peeled the onion back a little further and what did it say? We found out that where is this property located? It's around our largest military installations in America.
▶ 1:34:59And what's unbelievable, we actually got a a bipartisan bill. had Democrats that crossed over because they know that this is a threat to America. When your agents do uncover these foreign uh backrow operations, what obstacles do you face in uh proving the criminal ties uh and actually shutting them down?
▶ 1:35:22Yes, sir. Uh problem is uh my mistake. The the problem is federal law doesn't require uh in detail identification of all the different organizations, entities, companies or people that have uh an interest in particular property. You can obscure it in that way.
▶ 1:35:44One way this uh Congress could address this problem is by making clear that you have to identify any and all foreign nationals, particularly uh Chinese foreign nationals who are potentially associated with the PRC or the CCP as being real parties of interest in either acquisitions of uh property by purchase or by leasing.
▶ 1:36:09so that you can then put the onus on the people who are the property owners as well as the real estate uh people to make them help the federal government identify when the Pu uh PRC and the CCP is involved.
▶ 1:36:24Thank you, Mr. Larkin. Uh our national security strategy says China's the only country with both the intent and the ability to reshape the international order. It also calls China the Pentagon's top challenge. While our military has been focused on China for some time, do you think other departments like DHS need to increase their focus on China's influence here at home? I do.
▶ 1:36:48I think one of the problems is the American public doesn't understand the role that China plays in the illicit drug trafficking and other activities that are damaging to the
▶ 1:37:00Thank you. Mr. Urban, you've spent years investigating transnational money laundering networks. How significant a threat are Chinese networks to our financial system compared to other global actors?
▶ 1:37:13Chinese money launderers, their networks over the last seven years, they become the dominant money launderers for transnational organized crime around the world. They are the primary launderers for the Mexican drug cartels. For example, when they became the dominant moneyaunderers 2017, 18 or 19, they increased the net profits of the Mexican cartels that designated terrorist organizations by our estimation of 3 to 5% of their bottom line.
▶ 1:37:44The way to attack those networks is with high level prosecutions against command and control. Fininsen several weeks ago came out with additional guidance on on compliance AML red flag in terms of Chinese money laundering within the United States. We need to attack it with significant authorities and funding.
▶ 1:38:03If you could recommend one federal action that would immediately disrupt Chinese TCO operations in the US, what would that be and why? quickly.
▶ 1:38:14Proper funding and authority and mandate for the federal government through a task force to go after those networks aggressively in the next year with racketeering types charges.
▶ 1:38:23Thank you, Mr. Chairman. I yield back.
▶ 1:38:25The gentleman yields. I now recognize Representative Carter for his five minutes of questioning.
▶ 1:38:30Thank you, Mr. Chairman, and thank you to our witnesses for being here. For decades, the federal government's decision to criminalize marijuana has been nothing short of disastrous for our communities, for our economy, and for justice in America. The failed war against cannabis has especially devastated black and brown communities.
▶ 1:38:49Arrest and incarceration rates for marijuana offenses have been wildly disproportionate with people of color far more likely to be targeted despite using marijuana at similar rates as white Americans.
▶ 1:39:04These policies have feuded mass incarceration, separating families, stripping people of opportunities, and saddling them with criminal records that create lifelong barriers to housing, education, and This has entrenched cycles of poverty and and and inequality all in the name of a policy that Americans that the American people increasingly reject. Beyond the human costs, prohibition has created a lucrative illicit market.
▶ 1:39:35By outlawing marijuana rather than regulating it, the federal government allowed billions of dollars to flow through the underground economy. That money could have gone toward tax revenue, community investments, and public health, but instead it has enriched criminal enterprise and fueled violence. Today, with most Americans supporting legalization, it is past time that we acknowledge the truth. Marijuana prohibition has failed.
▶ 1:40:03The regulated cannabis industry is not the same um as what we were discussing today. The state legal cannabis industry employs over 425,000 people and operate in 40 states, including my home state of Louisiana. State regulated cannabis programs require rigorous product testing for contaminants, pesticides, and ulterants and potency, sometimes entirely absent from the illicit marketplace.
▶ 1:40:34Mr. Mr. Chairman, I'd like to enter into the record this letter from you from United States Cannabis Roundtable, the advocacy organization for the regulated statelicicensed cannabis industry. This letter includes more details about how legalization can combat foreign criminal
▶ 1:40:53Without objection, sorry.
▶ 1:40:55The real choice isn't cannabis or not or isn't cannabis or no cannabis. It's whether we let foreign criminals criminal networks run the show or whether we empower regulated American businesses that test, track, and play by the rules.
▶ 1:41:10If we want to dismantle foreign criminal networks and protect American communities, then we need to strengthen, not weaken, regulated markets, that means financial transparency, clear rules, and a federal framework that allows law enforcement to focus on fentanyl and other real threats to our community. Um, Mr.
▶ 1:41:30Larkin, in a recent report from the Heritage Foundation, you recommended you've recommended against rescheduling cannabis, but even President Trump has expressed support for rescheduling. Like President Trump, I believe we should endless arrests for cannabis conduct and focus on the real bad guys, those who are pushing fentanyl and other deadly forms of drugs.
▶ 1:41:56Why do you oppose President Trump's support for rescheduling, especially since that means we can both recognize medical uses and a better aligned law enforcement priorities?
▶ 1:42:08It would be a mistake legally, medically, and from policy perspective to reschedu cannabis from one to three. And it would also be a mistake even more so to legalize it. I wrote in an article in the Journal of the American Medical Association psychiatry multiple reasons why legally, medically, and policy-wise the rescheduling would be a mistake.
▶ 1:42:34Mr. L, have you
▶ 1:42:36I can give you one in particular.
▶ 1:42:37Can I just have you expressed your your your your concern with the Trump
▶ 1:42:44I published it in the Journal of the American Medical Association. That's the way think tanks do things. I haven't talked to anybody in the Trump administration, but I can tell you one thing that is absolutely true. For 80 plus years, the United States has trusted the Food and Drug Administration with the responsibility to decide what is a drug and whether it's safe and
▶ 1:43:05I'm I'm going to reclaim my time because I only got 25 seconds. You argue in your testimony that state legalization has not eliminated the less illicit black market. But isn't it true that we have legalized cannabis in in most of our states? it remains illegal at the federal level which is why uh despite paying millions of dollars in tax taxpayer dollars licensed operators often shut out of traditional banking services and are forced to operate in cash.
▶ 1:43:30When a legitimate operator is shut out of banking it makes it harder for law enforcement to trace transaction determine who is compliant and who is not. Wouldn't law enforcement and public safety be better served by a federally regulated system to track the flow of marijuana businesses processing and distribution? Thus making it clear who the real operators are versus the Chinese who are uh inundating our communities with marijuana that may in fact be tainted.
▶ 1:43:58No, the Chinese will also take advantage of any legally sellable cannabis product. They make money not only from illicit sales but from lawful sales. And they actually try to focus on states that have medical or recreational programs so that they can have lawful sales, big outdoor grows and the like. Ask my colleague.
▶ 1:44:23The chairman has been very generous. My time is up. But I'll ask you a final question. Is that part is it your assertion that all marijuana should be Is it your assertion that all cannabis should be illegal med medicinal and or
▶ 1:44:39Yes, because the food and drug the food and drug I
▶ 1:44:43gentleman's time has expired. I now recognize Representative Ogles uh for his five minutes of questioning.
▶ 1:44:50Thank you, Mr. Chairman. Ask unanimous consent to submit for the record resolution number 25109 from Ciscoya County, California Board of Supervisors requesting that Governor Nuome of California proclaim a state of emergency regarding illegal pesticides and elicit cannabis operations. So ordered.
▶ 1:45:14now I I want to be clear. The CCP is the existential threat to the United States of America. The CCP has set up operations to leverage cannabis operations, both illegal and as you say, Mr. Larkin, legal operations in this They work handinand with the cartels in Mexico to undermine this country.
▶ 1:45:40So what is in fact a threat to the United States is not Homeland Security, but it's China and the Mexican cartels. Unfortunately, instead of having a hearing on the CCP and elicit activities in our country, some of my colleagues on the other side of the aisle are more interested in protecting their suppliers for their personal use than they are of fulfilling their duty and protecting this country. And I, for one, have had enough of this nonsense.
▶ 1:46:09We need to recognize the truth that the CCP is setting up operations in this country. They want to destroy this country. They want to see us on bended knee. And I say hell no. So whether it's one three on the schedule, whether it's legal or illegal, we have to recognize the fact that the CCP is within our borders.
▶ 1:46:38They're buying our farmland and they're growing whatever they can grow that they can make money off of. And my colleagues need to wake up and have an honest conversation about those facts instead of grandstanding and again protecting their own suppliers. Mr. disturbing. Are Chinese TCOs laundering money in connection to these illicit marijuana grow operations?
▶ 1:47:00And to what extent are they relying on pre-existing China moneyaundering networks in the United So the pre-existing Chinese moneyaundering networks, those networks funded this substantial increase in Chinese organized crime cultivation marijuana operations. They're the ones that funded it and stood this up on a massive basis. For example, I I never focused on marijuana trafficking during my career in DEA prior to this.
▶ 1:47:27What got my attention is when Chinese money launderers took over moneyaundering for the Mexican cartels in approximately 2018 as we stood up this intelligence gathering effort to understand Chinese organized crime. We were shocked at the marijuana grows that were in Northern California, exploiting the land, exploiting our money law, our our banking laws, our mortgage laws, taking water, taking electricity. The theft of it was just unbelievable.
▶ 1:47:54So we recognized that not only did we have to attack the Chinese moneyaundering network, but we also had an opportunity, right, and and and and a need to attack the Chinese cultivation grows that were happening throughout the United States. Colorado, Oklahoma, California, Maine, and elsewhere. The Chinese money launderers are the ones that funded this and set this up. That's why you saw so much money and the scale happen so
▶ 1:48:18Mr. disturbance. Just a few weeks ago, the Department of Treasury's financial crimes enforcement network, Fininsen, I'm on financial services, which uh regulates that that organization, highlighted the role of Chinese moneyaundering networks in partnering with the Mexican drug cartels to launder drug profits. How does the earned money from illegal marijuana trafficking facilitate their money laundering activities?
▶ 1:48:39And quite frankly, when you look at the supply chain that they are setting up, what other illicit goods may also be such as human trafficking are part of that supply chain.
▶ 1:48:52One component of the organized crime revenue feeds the other. So for example, the the the the moneyaunderers and the ability to purchase land and goods throughout the United States for for cultivation assists the moneyaunderers. the human trafficking component and getting back to the national security component to this.
▶ 1:49:09All of these revenue streams that is benefiting Chinese organized crime promotes and provides access points throughout our United States government promotes access to different places that they can corrupt uh financial institutions that they can Vincent recently warned the Chinese moneyaundering networks pushed over 300 billion through US financial institutions in just 5 years. How much of that volume do you believe is linked directly or indirectly to illicit marijuana operations?
▶ 1:49:40The majority or the significant component to that was the proceeds of Mexican cartel drug trafficking. A significant material component to that, right? I'm not going to put a percentage on it, but you're talking billions of dollars was the illicit marijuana trade. It it like essentially put on steroids Chinese organized crime within the United States. the money they made off marijuana cultivation.
▶ 1:50:05I want to thank the witnesses. I apologize I didn't get I didn't have questions for you and I thank you to the
▶ 1:50:10The gentleman yields. I now represent rec recognize representative nod for his five minutes of question.
▶ 1:50:14Thank you, Mr. Chairman. Um Mr. Urban, I want to talk to you quickly about some of the misconceptions out there, but criminal organizations, the best ones are the hardest to catch. They have a proficiency of layering in camouflage, making it very difficult to apprehend, to investigate. And in my time with law enforcement, there's some easy pickings, the guys that are walking around the sidewalk with an AK-47. Um, that's easy.
▶ 1:50:41But it's the folks who are moving the currency, who are masking illegal with legal activities, so on and so forth. And I want you to talk to us a little bit about how the Chinese criminals have successfully hidden in polite society.
▶ 1:50:56Because when I investigated marijuana cultivation that was illegal, they had a very intricate network of legal front businesses uh that enabled them to move millions of dollars that looked legitimate, but when you start to peel the onion back, it was a pretty harrowing uh viewpoint. So talk to us about how they are successful in betting in polite society. So they become so successful as to exactly what you said because they're being controlled by the top echelon of Chinese organized crime.
▶ 1:51:25Some of the most sophisticated operators in the world. They're very sophisticated and disciplined in the sense that they they engage in what we would view as lowrisk criminal activities. The money laundering, the violent component to to what Mr. Anderson stated, that's only more recently. They try to stay away from violence or what would you know uh uh have federal prosecutors become interested in prosecuting them. Hence marijuana trafficking, money laundering, human smuggling.
▶ 1:51:53They also rely on this network in the Chinese underground banking system that's been around for years. And lastly, we touched upon this. It's very difficult to to uh recruit confidential sources to engage these networks and wiretap these networks on WeChat is impossible.
▶ 1:52:10Yep. And uh in terms of the the state structures, the state legalities, we were promised if you legalize it, you'll see less illegal marijuana. If you legalize it, there won't be nearly as many incidents with toxicities and so forth. In my experience prosecuting these cases, they used a sloppy legal legalization effort to almost balloon the amount of marijuana they were able to traffic. It was illegal in many instances. Uh but the sloppy legal structures has brought about a greater problem in many respects.
▶ 1:52:41So, we don't have the regulatory component to this in place that would negate uh subsidizing or allowing organized crime on a national basis to exploit the marijuana market.
▶ 1:52:51And in your one one of the things that is often mis misstated, it's it's framed as though you have a marijuana dealer and then every other type of criminal. In my experience, organized crime touches the the full spectrum when they get to a certain level. methamphetamine, heroin, fentanyl, marijuana is just one component of it. So to splice it out is often an an inaccurate assumption. Is that your experience?
▶ 1:53:16Y Mr. Larkin, briefly you said you mentioned I'll give you a chance to answer the question uh that Mr. Carter asked. Would it be wise, yes or no, to to legalize marijuana in the in the country in your opinion?
▶ 1:53:28No, it would not. It is a problematic drug when you use it heavily or on a long-term basis. What I was going to say in response to the answer is we have not only the controlled substances act at work here, we also have the Food, Drug, and Cosmetic Act. For 80 years, we've trusted the FDA with deciding what is a drug and whether it is safe, effective, and uniformly made.
▶ 1:53:54The FDA could not say the cannabis plant is safe, effective, and uniformly made because it's not. Well, one of the one of the the the mistruths that proponents say is that there really isn't any problematic effects to marijuana. And it was interesting because when I was prosecuting organized crime, I only had a few cases, but they were really big cases in terms of quantity, in terms of sophistication dealing with marijuana, but they targeted young people.
▶ 1:54:20Please describe the effects that young people suffer when they are exposed to um high levels of marijuana on a on a continued basis. The juvenile brain is in a labile state, particularly in men. It doesn't come fully formed until early in the 20s. And the problem is the uh THC content of cannabis today is not what it was back in the days of Woodstock. Back then it was 3 to 6% THC.
▶ 1:54:50Now in the plants it can be up to 40% and in processed forms it can be 90%. Has there been a successful state system that controls the supply of marijuana to deliver only safe product to the
▶ 1:55:05Not to my knowledge. The problem is there is too great an amount of disuniformity in the product that's being sold. A few years ago, Nora Vulkco, the director of the National Institute on Drug Abuse, said, "We don't have in place the mechanisms to make sure that what is being sold lacks the pesticides that we know are coming from China and that are creating problems and will create even bigger problems 10 to 20 years down the road when we start
▶ 1:55:35seeing spikes in areas where there is a greater incidence of uh cancer because of it. Well, thank you witnesses for your testimony. I'm sorry I'm out of town out of time. Mr. Anderson, I had a lot of questions for you lined up, but uh maybe we'll get a second round if we're fortunate. And if not, I hope to have you back. Um, Mr. Chairman, I do have a UC request. I've got a uh an example here.
▶ 1:55:57It's a Department of Justice press release detailing seven Chinese nationals and their roles in m and moneyaundering millions of dollars in smuggling kilograms of illegal
▶ 1:56:08Gentleman asked it be put in the record without objection. Thank you. So ordered. Gentleman yields. I now recognize uh Mr. Green for his five minutes of questioning.
▶ 1:56:16Thank you, Mr. Chairman. I thank the ranking member as well. Um the um Chinese money laundering that's taking place. Um what what why is it so difficult for us to to understand how it's being done and to prevent it from being done? Yes sir. Uh they came to dominate the industry for several reasons.
▶ 1:56:47One, in the past there was always a certain cost to moneyaundering. It was 7 to 10% certainly to get those funds back to the Mexican cartel. The Chinese moneyaunderers changed the game in that one, they absorbed all the risk of laundering those funds. Two, they did it for 1 to 2%.
▶ 1:57:05Three, the funds that are collected, the bulk cash from sales of narcotics in this country that they take ownership or custody of, they began to sell to Chinese nationals that wanted to invest in the United States. They do this globally with a trusted network with what's called the Chinese underground banking system. And last, but certainly not least, they utilize the encrypted app called WeChat, which is controlled and monitored in mainland China that US law enforcement cannot have any judicial process.
▶ 1:57:36We can't wiretap it. So, what it allows for is that organized crime network globally to communicate with trust and speed. No other organized crime group in the world has ever had a a communication system similar to this. And are they using uh cryptocurrency? explain please.
▶ 1:58:01Yes. So certainly in the last two years the crypto component of the moneyaundering cycle has taken taken on a much more substantial role. As crypto is being used more and more globally. it's actually taken on more of a role in the moneyaundering process because uh the Mexican cartels would like to receive those funds in crypto. So, it's part of the process. Now,
▶ 1:58:26how do you uh recommend we deal with this given that we now have this these electronic transfers makes it rather difficult to I want to stop it. I'm just trying to get a sense from you as experts as to how we can do it. So the networks that exist right here within the United States, those Chinese money launderers on a daily basic pick up that bulk cash.
▶ 1:58:51So what we were talking about earlier of this inter agency task force that was designed to go after Chinese organized crime with severe penalties such as the racketeering laws should be should be stood up and funded. That's the first thing. The second thing is uh in terms of what we saw last last couple weeks ago from Fininsen that directive to the banking industry to enhance compliance red flag reporting on the moneyaundering transactions. And lastly, WeChat itself needs to be impacted.
▶ 1:59:19It cannot be utilized by Chinese money launderers on an ongoing basis again in this trusted network where they can communicate and move money. this the suspicious activity reports are not enough for for this large sum of money.
▶ 1:59:35It's it's not enough in a sense that uh financial institutions, crypto companies, wire emitters need to enhance and increase the suspicious activity reporting and their AML compliance to focus on Chinese moneyaundering
▶ 1:59:51Well, let me just close with this. Um, I um I'm I'm new to this money laundering and I'm trying to make sure that I get a better understanding of it and I believe that my understanding of what's happening in financial services can help me with what's happening here in Homeland Security. Is there any piece of legislation that you would call to my attention uh that might be helpful?
▶ 2:00:21Is there anything that you would have us do in terms of
▶ 2:00:26Over the last 18 months, the Fendoff Act and the Hall Act were good examples of successes in terms of the legislative process. What I would suggest is this inter agency task force that needs to be stood up nationally with the mandate to go after Chinese organized crime, fully funded data scientists, Mandarin translators, everything that's needed on that task force to attack the network.
▶ 2:00:47The second part is the racketeering laws need to be imposed on Chinese organized crime and there needs to be a legislative or some sort of executive branch solution with the Chinese government when it comes to WeChat. So it's it's it's not utilized on a global basis by Chinese organized crime. What again through legislative process that allows law enforcement to wiretap it or some negotiated strategy with the Chinese government where they negate the ability of WeChat to be utilized.
▶ 2:01:17Yes sir. If the chair would permit. It's also worth looking into the uh the problem that people are obscuring as as your colleague said through a lot of different layers of uh dummy corporations who the real parties and interests are.
▶ 2:01:35We need to start uh requiring that the real parties in interest be identified before uh whenever they are uh part of Chinese organized crime or a foreign government that is adverse to our interests because the easier you make it for law enforcement to try to see who really is owning this property and therefore what's going on at it, the easier it might be for law enforcement to take steps to stop the moneyaundering and the ultimate activity itself. Thank you, Mr.
▶ 2:02:08The gentleman yields. Um, if our panel of of experts would be willing, you know, given the inability to dive a little deeper, I wish we had gotten to in the middle of this. Um, there's going to be a few of us that stick around and ask a few more questions. If if the panel um, if you've got time to expedite this, for your sake and ours, I'm going to ask the committee members limit their time to three minutes. And um and so with that, I'm going to go out of order here. I'm going to let Representative Ogles go first.
▶ 2:02:37Um I'll follow through with anybody on the on the Democrat side and then Democratic side and if if Mr. Kn you want to follow him and then I'll go last and I'll watch my time because I've got a time constraint. All right. So with that said, uh Representative Ogles, you are recognized for three
▶ 2:02:52Again, thank you, Mr. Chairman, and to the witnesses. Director Anderson, it seems like these illegal grow operations are run by a core criminal element that oversee low-level workers who are often victims of trafficking. Is this an accurate description based on your
▶ 2:03:07Yes, sir. You absolutely uh hit the nail on the head. It is uh you have upper management very well organized criminal transnational criminal organizations, but with that comes every other crime with it, which is the human trafficking, the labor trafficking, the sex trafficking, and the violent crime. and every other crown that follows underneath it.
▶ 2:03:26Now, is there from your experience a difference that you've seen between the immigration status of the low-level workers versus the higher level criminals that are actually operating these networks? Well, there's there's a definite difference between the two. Um, so your high level every your high level transnational criminal organization, your your person who's running operations, they look different, they dress different, they drive different vehicles.
▶ 2:03:52Um, and then your migrant worker comes in, you know, once again, they look different, they dress different. Um, they they how they dress, how they speak to, even how they address you, meaning me and me in law enforcement, um, is totally different. Uh but there is a big significant difference between the two. Yes sir.
▶ 2:04:11So is it fair to say when you look at the complexity of this problem that that the highlevel organizers the the traffickers the lowlevel individuals that they are using in this this elix these illicit activities they're literally throwaways that if they get caught they get incarcerated they'll just replace them with someone else.
▶ 2:04:30Those are basically what we call
▶ 2:04:32That's right. Uh Mr. Mr. Larkin, to to what extent is the CCP tied to these Chinese Chinese TCOs operating the United States? Do you believe that the CCP is aware of the Chinese nationals who leave China to establish criminal operations in the United States?
▶ 2:04:49China is the most
▶ 2:04:52China is is the most heavily uh surveiled nation in the world. It's difficult to believe that uh the CCP is unaware of people who are engaged in criminal activities in other nations uh like what's happening here with Chinese organized crime. And keep in mind, you don't have to prove an affirmative agreement between them.
▶ 2:05:14Uh all you have to do is show through circumstantial evidence that the CCP is aware of and is helping out the organized crime measures. If you look at the statements the three of us have uh submitted, you'll see there are various types of evidence that points to knowledge by the CCP and the PRC of what is going on in Chinese organized crime.
▶ 2:05:36And that's the sort of evidence that the Supreme Court has said would be sufficient uh to justify a guilty verdict for conspiracy to engage in this activity.
▶ 2:05:46Well, thank you to the witnesses. Thank you to the chairman. I yield back.
▶ 2:05:50Gentleman yields. I now recognize Representative Thanodor for 3 minutes for his questions.
▶ 2:05:54Thank you, Chairman. Uh, illegal marijuana grows are a Marijuana grown illegally can be saturated with chemicals and that are dangerous to humans.
▶ 2:06:14The money generated by selling illegal on the black market funds criminal and the illegal grows bring all sorts of crime and destruction into American communities. The federal government needs a coordinated strategy to do all it can to shut down these illegal marijuana grows.
▶ 2:06:45I think we can all agree on that. Nevertheless, the Trump administration is eliminating the organized crime drug enforcement task force, which is the anti-rime task force in the country.
▶ 2:07:04For 40 years, OCDEF has helped disrupt and dismantle criminal networks with a drug centric until Donald Trump. First, Trump wrongly expanded OCDF's mission to focus on illegal immigration.
▶ 2:07:29Now, President Trump has a budget request that eliminates OCDETF Mr. Urban, in your experience at the DEA, how would you describe the role of OCDEF plays in combating illegal drug trafficking?
▶ 2:07:51And do you think that eliminating OCDEF will help combat illegal marijuana particularly by the Chinese criminal So during my career uh I called it OSEDF. So I'll refer to it as OSEDF. Sorry. Uh it was uh there was a tremendous benefit for OSED. One, it synchronized manpower and the agencies to work together.
▶ 2:08:21It designated the targets, the top levels of organized crime that we were going to target collectively and then it also funded that. So it was a mechanism to synchronize federal law enforcement and and it was very successful. I would suggest a you either utilize OSDF or you bring the equivalent and successes of OSED uh are necessary to go after Chinese organized crime, the Mexican cartels etc.
▶ 2:08:48Will the gentleman yield?
▶ 2:08:49Uh yes, sure.
▶ 2:08:50What does that acronym stand for? Do you Organized Crime Drug Enforcement Task
▶ 2:09:01Thank you, sir.
▶ 2:09:04Chairman, I yield back.
▶ 2:09:07Thank you. Recognize the gentleman, Mr. Kn for three minutes.
▶ 2:09:10Mr. Anderson, I've got a I've got a question for you. In terms of your experience in local law enforcement, what um what effect over the last 20 years plus of your career has international criminal activity had on the local law enforcement community? you. Yeah,
▶ 2:09:28I'm sorry. Um, well, the international crime has had a huge impact on our local law enforcement community. So, understand almost every precursor used to manufacture methamphetamine, fentanyl, or any other elicit manufactured drug like that comes from China to the cartels to across the rest of the US, which that's affecting every community across the US.
▶ 2:09:49But also with that is the underlying crimes such as the homicides, the sex trafficking, all the other crimes that come along right along with it. which it affects every community in the US. So, it affects absolutely everyone. No one's immune from it. Uh Oklahoma is a very rural state of 4 million people and we're and we're devastated by transnational criminal organizations
▶ 2:10:10in terms of the open border of the last four years. How did that affect organized crime in your local
▶ 2:10:18So, I I understand and I got to say this first off, I'm not a politician. I'm not even a police.
▶ 2:10:23I'm not asking. I was in law enforcement before I ran here.
▶ 2:10:26But I have to say that because it's going to sound like I am.
▶ 2:10:28Nope. I'm asking you that your your
▶ 2:10:30I'm telling you in in I've seen it both ways. Y
▶ 2:10:34I've seen when we couldn't get anything. I mean we matter of fact we were on a T3 and we was purchasing kilos of methamphetamine and Trump closed the border down during COVID. Nothing. I mean it was 6 months
▶ 2:10:51and cocaine and heroin. and crack all of
▶ 2:10:55And then we leave, we change administrations, uh we're flooded, we're inundated with uh controlled dangerous substances. Once again, I'm not making a political statement. I'm telling you what I've seen.
▶ 2:11:04And what effect does that have on law enforcement? Can you successfully fight crime with an open border?
▶ 2:11:10With an open border?
▶ 2:11:11No. Yeah.
▶ 2:11:12Absolutely not. And in regards to the task force model linking federal and state law enforcement, have you had any kind of uh experiences with that in your in your career?
▶ 2:11:23I have. Um I'm actually a a task force guy. I operated a task force for many years. On that task force was including federal uh agents and local agents
▶ 2:11:33and we still currently operate with our federal partners on task forces. in terms of force multiplication on the good side of the ledger. In my opinion, there's no greater way than task forcing federal and local jurisdictions together. Do you agree with that?
▶ 2:11:48I absolutely agree with it and we do it every day. Whenever I came into the bureau six years ago, we were down to approximately 50 agents. We're up to around 130 now. That's primarily because we TFO task forces.
▶ 2:12:01Yep. And I've been I've long been an advocate, sir, that every federal law enforcement agency should utilize and grow their task force program because international crime affects every community, large and small, across the country. Isn't that true?
▶ 2:12:14That is absolutely correct.
▶ 2:12:16Well, Mr. Anderson, thank you. I'm glad I got a a second round to ask you questions. To all the witnesses, please come back and talk to us about this important topic. Mr. Chairman, I yield
▶ 2:12:24The gentleman yields. We're concluding here. Last thoughts. We have three minutes, so essentially a minute each. Mr. Urban, final thought.
▶ 2:12:34We've demonstrated what the effect is on the communities. We have the intelligence. I would ask that you fully fund a task force to attack these networks. This is not that hard. It's it's tough work. It's difficult. It's challenging, but fund a task force and give them the mandate to attack these networks with individuals like Mr. Anderson. Please,
▶ 2:12:52Mr. Parkin
▶ 2:12:54in the short run the most important thing to do is educate the people in your communities about these problems. I think when people think of drug problems they think of Mexico. They don't think of China. They have some idea that China is involved in selling fentinel precursors but they don't realize the full extent of the tentacles that China has extended into the United States. The public needs to know this.
▶ 2:13:20Holding this hearing is important, but it is also important that you tell the people in your communities about what is happening. Remember, the Chinese are playing the long game. They can do this for decades, for centuries. They don't
▶ 2:13:35But we can't do that. We have to act
▶ 2:13:38Mr. Anderson,
▶ 2:13:40I think it is imperative that we educate the public on what's going on in in the nation, especially when it comes to the CCP and uh the rest of the world and the movement that we we know that we are seeing that is going on and transpiring. And when you're talking about the long game, they're in the long game. They've been doing this for many, many years. And we talk about what's going on with the money laundering between um and the and the precursors uh since we can go all the way back to 2007.
▶ 2:14:07That's what we know for sure whenever the cartels started reaching out to the people in China and making these making these deals. That's when that's how far back it's went. So we're already into the long game. One thing I would ask legislation to do and to seriously look at I do think we're better whenever we bring all of our resources together and we combat our problem because you're talking about a really huge global network. We have to bring our people together. We have to bring our experts together and we have to fight this within. I would also ask that this legislation looks at the Communication Act of 1996.
▶ 2:14:38If you look at and you've been a federal prosecutor, you look at how we've dismantled criminal organizations across the US. We've done it through that act. That act is outdated. The the criminal element has surpassed us. We can't do the cases like we used to because of all these encrypted apps that are floating around on everyone's phones. So, I would ask that you look at that as well. Thank you for your time. I really appreciate you inviting us to be here today.
▶ 2:15:02It's clear from this hearing that the CCP is in a coordinated attack against the United States of America. Whether it's through their trafficking network, the cyber attacks, their facilitation of the Mexican cartels, they have declared an asymmetric war on this country. And it's time that we fight back with all the tools and resources that we have at our disposal. I thank the witnesses for their valuable testimony and the members for their questions. The members of the subcommittee may have additional questions for the witnesses and we ask witnesses to respond to these in writing.
▶ 2:15:32Pursuant to committee rule 7E, the hearing record will be open for 10 days. Without objection, we're