Mexican drug cartels are partnering with Chinese money laundering networks to funnel hundreds of millions of dollars in drug proceeds to Chinese nationals in the United States, according to a new report from the Wall Street Journal.

The Sinaloa Cartel — formerly headed by Joaquin “El Chapo” Guzmán — is allegedly working with Chinese groups based in the U.S. to funnel hundreds of millions of dollars in cartel cash through American banks and ultimately into the hands of Chinese nationals living in the U.S., the Wall Street Journal reported Wednesday.

The scheme often begins in Mexico, where cartels make billions of dollars selling cheap drugs into the United States.

Chinese nationals in the U.S. travel to Mexico to pick up large amounts of cash directly from the cartels. They then deposit the cash into a network of accounts held at major American banks before selling it to wealthy Chinese clients who pay using Chinese yuan, according to the Journal. The money laundering groups then purchase low-cost goods from China, which are shipped to Mexico, and sold under the cover of legitimate trade. The proceeds — in pesos — are returned to the cartels.

Chinese laundering groups in the U.S. have grown in prominence in recent years, partly due to financial restrictions imposed by the Chinese government, added the Journal’s report. Beijing prohibits individuals from moving more than $50,000 out of the country in foreign currency, and many wealthy Chinese nationals also face sanctions, creating strong incentives to bypass legal channels. To purchase homes in America or pay for their child’s tuition at an American university, wealthy Chinese buyers have to find cash somewhere else. (Read more from “How Chinese Operatives Are Laundering Mexican Drug Money In Broad Daylight” HERE)