Argentina Dismantles Chinese Transnational Criminal Organization

Argentina Dismantles Chinese Transnational Criminal Organization

By Juan Delgado / Diálogo
October 17, 2019

The organization, a fish and seafood exporter, was charged with smuggling, tax evasion, and money laundering. Authorities estimate that the criminal activities caused the loss of more than $23 million to the Argentine Treasury between 2017 and 2019.

Argentine authorities determined that the organization was made up of six companies that exported fish products at low prices to two companies in Uruguay belonging to the same Chinese group members in Argentina. The Federal Tax Administration (AFIP, in Spanish), which led the investigation, said the evasion tactics ended with the delivery of goods to companies in Brazil and China, rebilled at market prices.

“For many years, [the organization] set up a complex transnational corporate structure that included over-invoicing operations among the companies to inflate costs, and under-invoicing foreign trade operations,” AFIP said in a press release. “In this way, they evaded millions of dollars in taxes, which had to be reintroduced into the economy through money laundering.”

AFIP agents, in coordination with the Argentine Federal Police, raided 14 facilities in Buenos Aires province. The agents seized currency from 10 countries (more than $35,000 in cash), as well as cell phones, memory cards, and passports of Chinese nationals, which enabled them to dismantle the Chinese ring.

“The actions of this criminal group are likely associated with the practices of so-called Chinese triads, organizations with roots on the continent and Hong Kong,” Sergio Cesarin, coordinator of the Center of Studies on Asia Pacific and India at the University of Tres de Febrero, Buenos Aires, told Diálogo. “This is very common with Chinese criminal organizations, which are deeply rooted in illegal gambling, weapons trafficking, and even narcotics.”

Cesarin emphasized the vulnerability of the fisheries sector, which is also exploited through other criminal activities, such as illegal fishing or trafficking of endangered aquatic species. According to 2018 data from the Food and Agriculture Organization of the United Nations, Argentina loses an estimated $2 million a year from illegal fishing.

In a 2018 report, the investigative organization InSight Crime said that Chinese criminal groups have been operating for years out of Asian migrant communities in Latin America and that they were connected to larger structures in China.

In 2016, Argentine authorities disrupted the largest Chinese organization in the country, the Pixiu group, linked to a powerful and violent mafia in China. The organization  extorted some 300 local Chinese businesses, making up to $1.5 million per month, reported InSight Crime.

Although the capture of the Pixiu leaders dealt a harsh blow to the Chinese mafia in Argentina, the investigative group said that criminal organizations are very adaptable. In November 2018, the Argentine Security Ministry said it had disrupted another Chinese ring that was also connected to the Chinese Pixiu group, which extorted Asian businesses in Buenos Aires province. In July 2019, the Argentine newspaper La Nación reported several attacks against Argentine shopkeepers in the same area, indicating that the Chinese mafia may be widening its targets.