In a move that may quell the flow of synthetic recreational drugs into the United States, the Treasury Department designated a Shanghai-based drug lord and three others who work for him as “drug kingpins.”
At the top of the wanted list is Zhang “Eric Chang” Lei. His company CEC Limited, also called China Enriching Chemistry, supplies precursor chemicals that have helped renew supplies of drugs that were becoming scarce, the most prominent being methamphetamine.
“This is a significant action on the part of the U.S. Department of the Treasury,” said Robert Bunker, distinguished visiting professor and Minerva chair of the Strategic Studies Institute at the U.S. Army War College.
“For many years now, shadowy individuals such as Chinese national Zhang Lei and his CEC Limited have sold so-called ‘bath salts’ internationally via the internet,” Bunker said. “This drug kingpin designation will once and for all attack the root of the organized criminal conspiracy that has been taking place.”
The drugs and chemicals Lei supplies have brought the drug war to a new and dangerous level. Synthetic drugs are designed to dodge regulations. When one drug is banned, the chemists merely alter their chemical structures to create new drugs.
The constantly shifting form of the threat has regulators scratching their heads for a solution—a way to ban these shape-shifting drugs that often come with unknown effects.
“Global synthetic drug suppliers like Zhang Lei have fueled an epidemic of hospitalizations, paralysis, and deaths, especially among young adults,” said Adam Szubin, director of the Office of Foreign Assets Control, in a press release. “We intend to disrupt these networks’ operations and deny them the ability to conduct international trade.”
On the Run
Lei was already a fugitive. He was charged by a court in Syracuse, New York, caught up in a bust that included a large-scale drug trafficking ring between New York, California, Texas, Virginia, and China.
“Eric Chang,” Lei’s alias, was regularly written on the packages of drugs, alongside his company’s name. According to the Treasury Department, Lei has shipped thousands of kilograms of synthetic drugs and controlled substances, making him nearly $30 million in the United States alone.
Lei’s company, it notes, has been the source of supplies for synthetic drugs in the United States and Europe, and “as the United States and other countries banned new psychoactive substances, Zhang and his associates developed replacement chemicals or used fraudulent shipping labels to continue to traffic illicit narcotics.”
Lei was arrested by Chinese authorities on Nov. 7, 2013, for allegedly teaching criminal methods to others, according to the Justice Department. It’s unclear where he is now.
His associates also have existing criminal records, according to the press release. Two of Lei’s employees, Zhang Jicheng and Hu Yongan, were previously arrested in the United Kingdom for establishing a “clandestine laboratory” for the “industrial-scale production of synthetic drugs.”
The third individual is Lei’s mother, Wang Guoyang. She is part owner of CEC Limited and, according to the press release, “received of hundreds of thousands of dollars in payments for illicit synthetic substances.”
The charges brought against Lei are unlikely to result in his standing trial. The United States and China have no extradition treaty.
And so the United States took a different route to sanction Lei. On July 29, the Department of Treasury designated Lei, his company, and three of his associates under the Foreign Narcotics Kingpin Designation Act (Kingpin Act). The designation freezes their assets and bans anyone in the United States from making a transaction with them.
According to the list of people sanctioned under the Kingpin Act, it appears that Lei and his group are the first that operate in Mainland China.
The move is significant. Regulators were struggling to fight the spread of synthetic drugs. By designating Lei under the Kingpin Act, they skipped the drugs altogether and went straight for the source.
“While the action itself will not stop all internet sales of synthetic psychoactive substances and precursors,” Bunker said, “it portends the future financial targeting and disruption of the major global synthetic drug networks.”