Three Chinese nationals hit with crushing indictment that has drug cartels panicking
Chinese drug equipment manufacturers just got a rude awakening.
The Department of Justice isn’t playing around anymore.
And three Chinese nationals hit with a crushing indictment that has drug cartels panicking.
Chinese pill press operation busted by federal authorities
Fake pills containing deadly fentanyl have been flooding American streets for years, taking countless innocent lives.
Now federal authorities are striking back at the source of the deadly epidemic.
The Department of Justice dropped a bombshell on Monday when it announced a 21-count federal indictment targeting a Chinese company and three Chinese nationals who allegedly supplied equipment used to make counterfeit drugs that are killing Americans.
Federal prosecutors charged CapsulCN International Co. Ltd. along with three Chinese citizens – a 40-year-old man named Xiochuan Pan (who goes by “Ricky”), a 37-year-old woman named Tingyan Yang (known as “Monica”), and a 30-year-old woman named Xi Chen (who uses the name “Inna”). The charges include smuggling violations, breaking the Controlled Substances Act, and money laundering crimes.
According to prosecutors, for over a decade – from December 2011 until April 2025 – these defendants shipped pill presses, pill-assembly machines, and fake molds to America that can churn out millions of counterfeit pills that look just like real prescription medications but often contain deadly substances.
Pan, who served as CapsulCN’s principal officer and shareholder, faces additional charges of leading a continuing criminal enterprise.
“This indictment and today’s domain seizures send an unmistakable message to criminals in the People’s Republic of China and across the world — the Department will use every weapon in its arsenal to combat those who facilitate the manufacture and distribution of deadly drugs in the United States,” Deputy Attorney General Todd Blanche said.
Chinese nationals marketed equipment for making fake prescription drugs
According to court documents, CapsulCN marketed and sold pill-making equipment to U.S. customers through websites, e-commerce platforms, and social media accounts, specifically catering to customers looking to make counterfeit pills that mimicked legitimate prescription drugs.
In 2020, Pan and Yang allegedly created a new brand called “PillMolds” to advertise, sell, and promote counterfeit die molds in the United States.
The Department of Justice seized four internet domains used by the company: www.capsulcn.com, www.pillmold.com, www.ipharmachine.com, and huadapharma.com.
“These indictments against Chinese nationals exemplify Homeland Security Investigations’ unwavering commitment to breaking every link of the global fentanyl supply chain,” said Special Agent in Charge Jason T. Stevens of the HSI El Paso Division.
Chinese company used deception to avoid detection
The defendants allegedly went to extraordinary lengths to conceal their illegal operation from U.S. authorities.
Court documents reveal that CapsulCN concealed the nature and purpose of the pill presses, encapsulating machines, and die molds from U.S. customs officials by using deceptive packaging and false manifests that undervalued and misidentified the contents.
The company also allegedly helped customers avoid mandatory DEA reporting requirements for importing pill presses and encapsulating machines.
To further evade detection, CapsulCN would disassemble machines and ship the parts in separate packages with false manifests. Company employees then directed customers to social media accounts with instructional videos on how to reassemble the machines once in the United States.
The counterfeit die molds sold by CapsulCN could be used to create pills that mimic legitimate pharmaceutical drugs such as oxycodone, dextroamphetamine, hydrocodone, amphetamine, and alprazolam. Drug traffickers often replace the active ingredients in these legitimate pharmaceuticals with deadly controlled substances like fentanyl and methamphetamine
“This U.S. Attorney’s Office is focused on bringing the full force of justice to anyone who conspires to poison our communities with fentanyl,” said Acting U.S. Attorney Margaret Leachman for the Western District of Texas.
Chinese nationals maintained bank accounts to fund criminal enterprise
Yang, Chen, and other CapsulCN sales representatives allegedly communicated extensively with potential U.S. customers through company emails and encrypted messaging applications.
In these communications, they agreed to smuggle pill-making equipment to customers and helped them select die molds that best replicated identified pharmaceutical drugs.
The indictment claims CapsulCN maintained bank accounts in China and accounts with online payment services to facilitate the transfer of funds from the United States to China to further their criminal activities.
The investigation was conducted by the HSI El Paso Field Office with assistance from Customs and Border Protection, IRS Criminal Investigation’s El Paso Office, and the U.S. Postal Inspection Service.
This operation is part of the Organized Crime Drug Enforcement Task Forces (OCDETF) program, which identifies, disrupts, and dismantles high-level criminal organizations threatening the United States.
The Justice Department emphasized that an indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
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