STATEN ISLAND, N.Y. — U.S. Drug Enforcement Administration (DEA) raids last week on Staten Island were part of a multi-state investigation into a massive criminal enterprise where money was laundered from illegal sales of marijuana, according to multiple sources.
Authorities allege that the money trail of illegal weed exchanged for cash winded its way through New York City as it traversed the East Coast to the West Coast and all the way to China.
Several Staten Islanders are among a total of nine defendants accused of playing roles in the multimillion dollar scheme, which was revealed in court documents supporting a federal indictment filed in Baltimore, Md.
The U.S. Attorney’s Office in Baltimore is leading the prosecution alleging that bundles of illegal weed and cash traded hands near a storage facility in Travis on our borough and in a building in Manhattan.
Over $3 million in cash and 300 pounds marijuana were confiscated in connection with the investigation, officials said.
The DEA and the New York State Police were among the authorities who searched homes in the vicinity of Katan and Wainwright avenues in Eltingville and Poi Court and Nome Avenue in New Springville on Sept. 24 in connection with the probe.
The indictment was unsealed on Sept. 26 charging the defendants with conspiracy to distribute controlled substances and conspiracy to commit money laundering.
Gun violence sparks probe
An investigation into two separate non-fatal shootings of one man in Baltimore “revealed a sprawling network of individuals laundering millions of dollars generated from the illegal distribution of massive quantities of marijuana,” according to court documents.
Money launderers and drug traffickers operating in Maryland sent large quantities of cash to New York, New Jersey, Washington and other states to obtain shipments of marijuana and hide the source of their proceeds, according to court documents.
Individuals mostly from New York collected millions of dollars from operatives in Maryland and other states and then transported those proceeds to money launderers and drug traffickers in Washington state and other locations in exchange for copious amounts of marijuana. Some of the money was secreted in the airline luggage of passengers who served as “mules” and proceeds also were shipped via FedEx, according to the indictment.
In phone communications between the conspirators, drug trafficking proceeds sometimes were referred in coded language, including “paper” for cash and “stuff” for marijuana, court documents said.
Alleged conspirators in scheme
Court documents identify the defendants as Michael Micklos Jr., Can Quan Xu, Praveen Morgan, Huayi Zhong, Zebin Liu, Chunbing Qui, Qihai Tao, Peng Huang and Isaac Huynh.
Micklos, the target of the two shootings in Baltimore, was the leader and mastermind of the criminal network operating in Baltimore, Richmond, Va., the New York metropolitan area and Allentown, Pa., according to court documents.
Xu, an alleged leader of the criminal enterprise in New York, is listed in public records as living on Poi Court in New Springville. Also known as “Shawn,” he was a “multi-million dollar marijuana distributor” in New York and the leader of a money-laundering operation, according to court documents. Xu and his associates allegedly obtained large amount of marijuana that they dispensed on the East Coast. Xu collected millions of dollars in drug-trafficking proceeds that he disseminated to suppliers or sent through wire transfers to bank accounts in the People’s Republic of China, authorities say.
Liu lives on the 700 block of Katan Avenue and Zhong was also involved in alleged illegal activities at that address, according to court documents. Zhong, also known as “Daniel,” teamed with Liu, also known as Ben, on our borough to allegedly receive, package and distribute marijuana to customers. They also allegedly picked up and transported drug money in bulk. Liu has referred to Xu as his boss.
Huynh listed West 10th Street in Manhattan as the return address for packages of drug money that he shipped from a FedEx store in Brooklyn, according to court documents.
Morgan was a member of the Micklos drug trafficking organization and the de facto bookkeeper who received orders for marijuana and kept track of inventory throughout the enterprise, court documents allege.
Qin, also known as “President Qin,” of Portland, Ore., was a marijuana supplier for the Xu organization who often sent shipments of marijuana to New York and received large amounts of cash in return, according to court documents.
Tao, based in Seattle, Wash., was a marijuana supplier for Xu and other organizations that laundered money and trafficked drugs, court documents allege.
Huang, also known as “Rio,” was allegedly a member of the Tao drug-trafficking organization based in Seattle.
Huynh was a member of Xu’s operation and was responsible for obtaining bulk amounts of drug-trafficking proceeds and shipping them, via FedEx, to Xu’s suppliers, authorities allege. Investigators allege they seized numerous packages totaling over $650,000 shipped by Huynh during the course of this investigation.
Attorneys for the defendants are not yet listed in public records.
Staten Island connections detailed
Associates of Xu often were seen taking cash in and out of a location on West 10th Street in Manhattan. Intercepted phone conversations in June between Xu, Zhong and Huynh allegedly captured Xu telling Zhong to take money to “West 10th Street” and Zhong saying he would be there in “twenty minutes to hand off some paper.”
A short time later, Zhong left his home carrying a large bag. After driving to West 10th Street, he called Huynh to let him know he was there and Huynh allegedly replied, “Okay, alright, I am coming downstairs now.” Zhong removed the large bag from the rear seat of his vehicle. Huynh left the stash house to meet Zhong and both men walked to the building on West 10th Street together, authorities say. Moments later, Zhong left without the bag.
Authorities intercepted communications indicating that Micklos, Xu and others hatched a plan to exchange 250 pounds of marijuana for money in a parking lot in Travis, court filings allege.
In August, DEA agents did surveillance in the vicinity of Liu’s home on Katan Avenue where they saw Zhong’s black 2023 Chevrolet Suburban parked in the driveway and Liu’s gray 2023 BMW M235i parked in front of the residence in August.
Less than two hours later, Zhong allegedly drove his Chevrolet with Liu as a passenger to the parking lot of a storage facility on Wild Avenue in Travis. A second vehicle that traveled there from Baltimore parked next to the Chevrolet. The trunks popped open and an estimated 250 pounds of marijuana in bags was transferred from the Chevrolet to the other vehicle, authorities allege. Zhong and Liu allegedly received a black bag filled with drug money.
According to filings, the Chevrolet returned Liu’s home on Katan Avenue where Zhong was seen carrying the bag filled with money into the home. Liu then left the home with a black bag containing the drug money, put the bag in the trunk of his BMW and drove away, authorities say.
Court documents allege that Zhong and Liu took the 250 pounds of marijuana from Liu’s home and delivered it on behalf of the New York laundering and trafficking enterprise headed by Xu.
The DEA raided homes in Eltingville and New Springville last week. Read More