Transcripts For CSPAN3 Opioid Epidemic And Mail System Vulnerabilties 20180129

2. Well hear from representatives from u. S. Postal service, state department, dea and customs. This hearing will come to order. Thank you all for being here. Todays hearing continues subcommittee on investigations work to combat the Opioid Epidemic gripping our communities across the country. A bipartisan report on opioid related fraud, abuse and part d medical program. Subcommittee held a hearing on buying elicit opioids over the internet and shipping them to the United States through the mail. The Opioid Crisis, sadly, continues to get worse, not better. Last month, the center for Disease Control reported that more than 63,000 americans died in 2016 from Drug Overdoses. Indications are that number increased in 2017. These Overdose Deaths are shocking. The number of deaths continue to grow. My own home state of ohio, we were told recently is now second in the country in terms of Overdose Deaths. Its heartbreaking. And increasingly, these overdoses are due to a synthetic heroin, illegal versions of fentanyl, a drug that is 50 to 100 times stronger than heroin. In fact, in ohio, fentanyl and its variations were involved in 60 of the Overdose Deaths last year. So, its become the number one killer in ohio. The vast majority of illegal fentanyl is purchased online from labs in china and then shipped to the United States through the mail. Well hear from the Drug Enforcement agency today about that. But i think its shocking to people when they find out that this is coming through our u. S. Mail system. Last night, the subcommittee released its bipartisan report. I hope you all have seen it, how criminals exploit vulnerabilities in International Mail and use the u. S. Postal service to ship illicit opioids into our country. Without objection, i would move that the subcommittees report be read into the record. After our initial 2017 hearing, we set out to find out how easy it is to purchase fentanyl online. And how it was shipped to the United States. What we discovered, of course, was it was shockingly easy to do so. All you had to do was search fentanyl for sale. That simple search returned hundreds of websites, many affiliated with chinese labs, all openly advertising Illegal Drugs. The field was narrowed to just six websites, and we sent emails asking basic questions about how to purchase and ship fentanyl to the United States. These Online Sellers were quick to respond, unafraid of getting caught, apparently, and ready to make a deal. Youll see that in the report. They offered discounts for bulk purchases, even tried to upsell us to a more powerful synthetic heroin that is so strong its used as an elephant tranquilizer. Ordering these drugs was as easy as buying any other product online. I must note our subcommittee never completed a purchase of drugs online. It was just too dangerous to risk exposing someone to deadly fentanyl during delivery, but we did use the Online Sellers Payment Information to determine if others were buying. And of course, we found out they were. Just from these six websites alone, we identified more than 500 payments to Online Sellers by more than 300 americans, totaling 230,000, most of which occurred over the last two years. So this is just a small sample. Only six websites, and then frankly, we used just one Payment System to be able to identify some of these buyers. The 300 people, by the way, were located in 43 different states with individuals in my home state of ohio, pennsylvania, and florida sending the most money to Online Sellers. The map that we have back here behind us shows the concentration of where most of the purchases were made. Thats also in the report. We also asked how the Online Sellers would ship the drugs to us. Every single one of them preferred to use the u. S. Postal service. They didnt want to use the private carriers like dhl, fedex, u. P. S. They wanted to use the Postal Service. They told us they use the Postal Service because the chances of the drugs getting seized were so insignificant that delivery was essentially guaranteed. We were also able to track hundreds of packages related to these online purchases. We identified seven people out of the 300 who died from fentanylrelated overdoses after sending money to and receiving packages from these Online Sellers. One of these individuals who died was a 49yearold ohioan from the cleveland area who sent about 2,500 to an online seller, received 15 packages through the Postal Service over a 10month period. His autopsy confirmed that he died from acute fentanyl intoxication just weeks after he received a package from this online seller. By analyzing more than 2 million lines of shipment data obtained in our investigation, we located 3 individuals in the United States who were likely distributing these drugs. We identified more than 120 instances of different people sending a payment to an online seller in china and then a day or two later receiving a package from one single pennsylvania address. The person at this pennsylvania address, by the way, was working with the online seller to domestically transship drug purchases. Shipping data reviewed during the course of the investigation also indicated other individuals who purchased items to make pills, including pill presses, chemical bonding agents and empty pill casings. Its not surprising that people are ordering fentanyl online to sell. The Profit Margins are just staggering. Based on dea estimates, the street value of the Online Transactions from just the six websites the subcommittee investigated translates to about 670 million in fentanyl pills to sell on the streets of our communities. Were already working with Law Enforcement authorities to make sure these drug dealers will be brought to justice and will continue to do this after this hearing. But our findings today show the crucial role advanced electronic data can play in protecting our country and fighting the Opioid Epidemic. We also need some legislative changes. Last year, the Postal Service only received advance electronic data on about 36 of the more than 498 Million International packages coming into our country. So, about 500 million packages a year and only about 36 of them have the advanced electronic data that allows Law Enforcement to identify these suspicious packages. This means that about 318 Million International packages came here with no data, therefore no ability for customs and Border Protection or other Law Enforcement well hear from today to target these packages for screening. We didnt know with regard to 318 million packages, who sent it, where it was going, what was in it. And this is a massive loophole thats undermining the safety and security of our country. In addition, the data we do get from foreign post that we review during our investigation appears to be of questionable quality. So, its only 36 , but even much of that data is not helpful. At times, the data was nothing more than illogical lines of letters and characters entered by someone who didnt understand how to construct a standard american address. When we have the data, the Postal Service fails to locate it about 20 of the time. So again, electronic data, 36 , much of that datas not very helpful, and even when Law Enforcement says, aha, weve got a package here that looks like its suspicious, wed like to look at it, 20 of the time, they cant find the package. It gets through. What we are left with is a federal government whose policies and procedures are wholly inadequate to prevent the use of International Mail to ship illegal synthetic opioids into the United States. In contrast, our Postal Service provides data on about 90 of the packages that it ships to foreign post. So, about 90 of what we send out, we do provide that electronic data to foreign governments. After september 11th, 2001, the terrorist attacks on that day, collecting advance electronic data was identified as a national priority. For all the right reasons. In 2002, in fact, congress required private carriers to collect this data, so u. P. S. , fedex, dhl, others were required to collect it. It was left up to the discretion of the postmaster general and the Treasury Department with regard to the Postal Service. They were encouraged to do it, encouraged to study it, but it was left up to their discretion. For more than a dozen years, nothing happened, essentially, leaving customs and Border Protection to manually inspect target packages which is the equivalent, of course, of finding a needle in a haystack. Again, 500 million packages, then, it wasnt that many but hundreds of millions of packages. To their credit, the Postal Service and pcb started a Pilot Program in late 2015 to target suspicious packages from china using advanced electronic data, but our investigation found a lack of planning, the Different Missions of the agencies, and personality conflicts hampered the success, even of the Pilot Program that was started in 2015. That Pilot Program, by the way, started at jfk and our investigators were able to see that in action. Despite these problems, the Postal Service is head of global trade compliance wrote that Pilot Programs allowed them to put a positive spin on stopping opioids. While both cpb and Postal Service agreed the Pilot Program should be rolled out to all postal facilities, they only started that after the may 2017 hearing. Were glad they did it. We learned that this process was conveniently completed just days in advance of this hearing. So, earlier this week, again, i think, this hearing probably motivated some action, which is good, but it should have been a priority without having to hold this hearing. It shouldnt take a congressional investigation into the Postal Service and whats happening with International Mail to get our government to do its job. One part of the solution is more data. And thats why weve introduced this synthetic trafficking and Overdose Prevention act or the s. T. O. P. Act, which would require data on packages shipped through the Postal Service. We have 29 cosponsors from both sides of the aisle and i know this report and hearing will put pressure on us here in the senate to finally take some action. I really want to thank senator carper and his staff for working with us so closely on this investigation. Theres a lot more to be done to turn the tide of the opioid addiction, clearly, but stopping these deadly drugs from ever reaching our streets is certainly a good start. As the coauthor of the comprehensive Addiction Recovery act, i focused most of my career, actually over the last 20some years on prevention, treatment, longerterm recovery. Thats all important. But to keep this poison from coming into our communities is something we can do and should do. Just in the past week, near toledo, ohio, five individuals overdosed and three died. Fentanylrelated overdoses. Its so bad that officials issued an opioid advisory warning to the public, begging them to stay away from what was clearly a, quote, bad batch of opioids in northwest ohio. How many more people have to die before this poison stops coming into our communities . Before we take the steps the simple steps to at least understand where the suspicious packages are, how to get them offline, and not delivered to a p. O. Box here in america. How many people have to die before this happens . Yes, the Postal Service is in desperate need of comprehensive reform, and nobody has been more involved with that than senator carper. But its shocking that we are still so unprepared to police the mail arriving into our country. Again, i want to thank senator carper and his staff for working so closely with us. Chairman of the full committee has now joined us. Senator johnson. Im going to ask him if he has any brief opening remarks and i turn it over to the Ranking Member. Thank you, mr. Chairman. I want to thank you for your ongoing leadership on what is really a tough issue, an important issue and challenge facing our nation. Delighted to be joined by our full Committee Chairman today too. I want to thank our staffs, democrat and republican staffs, you know, fair amount of discussion of late about how we dont Work Together on this issue, we Work Together. We are one. And theres no space between us on this issue. Frankly, on a lot of others. I want to thank our witnesses for joining us today, for the work that you do, for the work that is done by the people who are your colleagues. Its an oversight hearing. This is also the result of an investigation. A big part of our job on full committee is to do oversight. Broadly over the federal government. This is oversight and investigation on something that we all care deeply, deeply about. No state has been immune from the damage that these drugs have caused. Including my home state of delaware. Im an ohio state native. I used to think delaware was a little town north of columbus, but it turned out to be a whole state and ive been fortunate to represent them for a while. But whether its delaware, ohio or the state of delaware, this is an enormous challenge that we face and its an all hands on deck moment and requires an all of the above strategy and its not enough just to deal with the symptoms of the problems, and well be talking about that today, but also the root cause of these problems. Weve got to do both. According to the division of Forensic Science in my state, more and more delarwarians are dying from opioids every year. 2014, we lost 222 people. 2015, we lost 228 people. 2016, we lost 308 people. Theyre not just numbers. They are mothers and fathers, they are brothers and sisters, they are sons and daughters, aunts and uncles, grandparents, all of the above. Just last month, it was reported that Emergency Responders in our largest county we only have three but our largest county, where my wife and i live, Newcastle County were dispatched to a reported Drug Overdose every 80 minutes. By early november of last year, paramedics there had administered naloxone, a drug that can reverse an overdose, to nearly 600 patients. All told, opioids are now the leading cause of drug Overdose Deaths, killing more than 42,000 people nationwide in 2016. Last year, our subcommittee set out to learn what the federal government is doing to stop these drugs from entering our country. In may, we heard testimony from officials from the Postal Service, from customs and Border Patrol, from the state department in addition to several experts and First Responders on the ground in ohio, delaware and elsewhere who grapple every day with the impact opioids are having on our communities. They told us how opioids are getting into our communities through the mail and how theyre working together to stop that. Unfortunately, i left that hearing very concerned that the federal response was proving to be insufficient. Our investigation shows that progress has been made, but also that we have much, much more to do. In fact, their findings are, in a word, alarming. We found that fentanyl and other Even Stronger synthetic opioids are openly available for sale, as the chairman has said, on the internet, accessible to anyone who knows how to shop online. And once purchased, these drugs arrive primarily from china through the International Mail system. While sellers often prefer the Postal Service, they often offer shipment through private carriers like dhl, fedex, and u. P. S. Through our work, we obtained key payments and shipping data that enabled staff to link Online Sellers to fentanylrelated deaths and drugrelated arrests all over the country. We even found what appears to be a major opioid distributor in pennsylvania, where delawareans reportedly get most of their drugs. Its cpbs mission to keep these drugs from entering our country. That mission has unfortunately become increasingly more difficult as the number of inbound International Packages has skyrocketed. I would like to say, i think the chairman mentioned a needle in a haystack. When youre looking for a needle bigger in a haystack theres a couple of the things you can do about it. One is make the needles bigger or make the hay stacks smaller and we need to do both of those. But the Postal Service alone, volume has nearly doubled growing from about 150 million pieces in fiscal 2013 to nearly 500 million in calendar year 2017. Until recently, cbp was forced to sift through this massive number of packages from the Postal Service manually. Today, automation and the use of advanced electronic data has improved the targeting of data but the process is far from efficient and effective. Our investigation revealed that a 2015 joint Postal Service cbp Pilot Project at jfk airport suffered due to the agencies differing mission, a lack of koord thags zblooinchts coordination and interagency conflicts. As a result, the expansion to the four other Mail Processing centers was delayed until just this week. In addition, despite the massive amount of drugs coming into our country through the mail, the Postal Service and cbp only target a small number of packages each day. Meanwhile, as our report points out, our efforts to get cbp data, that it needs to better target suspicious mail items and intercept opioids and other contraband has also not kept pace with the volume of drugs that cross our borders. Unlike private carriers who control which packages enter their networks and have more freedom to turn away problem customers t Postal Service is required to delivered all the mail it receives from foreign post. This is due to the countrys membership in the universal postal union or upu, an International Body that sets global mailing standards and ensures that americans can send mail to friends, to family, to business partners, overseas. State department represents the u. S. At the upu proceedings, and while the Postal Service has made some progress in obtaining better information on packages through Bilateral Agreements with foreign post, the state department has watched for more than a decade now as some of our foreign partners have successfully fought efforts requiring more information on International Packages. It is urgent that the Postal Service and cbp Work Together, Work Together, to continue ramping up their targeting and inspection efforts and that the Postal Service and the state department speed up International Efforts to get cbp the data that it needs. At the same time, those of us in Congress Need to ensure that the Postal Service has the resources that it needs to be a stronger partner. As my colleagues are aware, protecting and improving the mail system in this country has been one of my priorities, biggest priorities, on this committee. The Postal Service is vital to our economy, as our work creates it plays an Important Role in our fight against the Opioid Epidemic as well. Yet it faces insolvency and the congress does not pass comprehensive postal reform this year. The enactment of this legislation will free up billions of dollars that the Postal Service can use to not only invest for the future, provide better service, but also to shore up mail security. All of that said, if we only focus on chasing drug shipments after theyve entered our mail system, well only address the symptoms of this problem. We also need to focus on what i described earlier as the root causes. To truly do that, we mustards our countrys considerable demand for drugs. As we know, health care plays a vital role in combatting the addiction that drives drug demand and medicaid is the countrys single largest payer for Substance Abuse disorder services. Many states with the highest opioid overdose death rates have used medicaid to expand treatment access. Mine is one. Ohio is another. We need to focus even more on making sure that our Health Care System has the resources that it needs to provide quality treatment to those suffering from this epidemic. And as we consider root causes, its also clear that we need to engage with china, the biggest source of illicit opioids entering our country, in order to successfully disrupt the supply of fentanyl and similar drugs. We did Something Like this during the Obama Administration through highlevel dialogue on Cyber Security and hacking. And given the success that that Bilateral Partnership had, this administration should commit at higher levels to a similar effort to tackle this Urgent Public Health crisis. With that in mind, im reached out to terry, our ambassador to china, former governor from iowa, we served together as governors, to gauge the level of engagement of our embassy and our team in china toward working with the chinese to say, hey, this is a problem. Not just a problem for us but some day its going to be a problem for you and you need to get your act together in order to help us but ultimately to help you guys. This reminds me of the importance of leadership in addressing complex challenges like the ones were discussing today. Its no Silver Bullet that can solve this problem and none of the agencies represented before us can do it alone. We need leadership from the top. Last month, the president established a commission charged with studying the Opioid Epidemic and determining how to fight it and then in october, he officially declared the crisis a Public Health emergency. Despite these highprofile moves, news reports suggest that only a couple of the commissions 56 recommendations have reportedly been implemented. We can do better than that. Further, the office of National Drug control policy, the entity charged with coordinating the federal governments counterdrug response, still does not have a permanent director. Ill say that again. Still does not have a permanent director. And recent media reports indicate that the president s upcoming budget will again propose a 95 cut in the budget of the office of National Drug control policy. On a day when were going to be when were going to be critical of some front line agencies for what appears to be a lack of focus and a sense of urgency about a real crisis, i think its only fair to call on the president for what appears to be a failure to make that crisis the priority that it should be. Let me just close with we have something in delaware we call the three cs. Communicate, compromise, collaborate. And weve added a fourth c, civility. Thats something in short supply around here, but not on this committee. We need to embrace Something Like the two or three cs as we fight this epidemic and one of those is to communicate and were doing that here today. Another is to collaborate. Do it with a little bit of civility. And if we do that, well make some progress and we certainly need to make that progress. Again, ill close by saying this is an all hands on deck moment. All hands on deck moment. This is an all of the above strategy thats needed. And as best as well as we do in our jobs, we always know we can do better. Our goal is perfection. We can do better here and we need to in the spirit of cooperation. Thank you, mr. Chairman. Thank you for your leadership. Thank you, senator carper. You mentioned the president ial commission on opioids and the recommendations. One, the recommendations was enactment of the s. T. O. P. Act that we talked about earlier. If you have a brief opening statement, happy to have you be heard now. Thank you for being here. Mr. Chairman, do you have a statement . Just thank you for your leadership on this. My own nephew died of an overdose in january 2016. Theres probably its probably gotten to the point where theres very few americans that havent been touched in very personal ways, pretty close connection to somebody whos died of some kind of overdose. Its a very complex problem. I want to thank you and your staff have done an excellent job preparing this hearing, the briefing. I want to thank the witnesses for your service to this country. It is complex. I think one of the things we do need to do in addition to what youre proposing here, greater information, you know, i have a bill stopping overdoses of fentanyl analogs. Its one of the real problems is scheduling these just minute differences in terms of analog drugs and immediately scheduling those. Theres so many things we need to address here. But it starts with identifying a problem, properly defining it, and highlighting in hearings like this. So again, i just want to thank everybody involved in this. Its not easy. But these are tragedies that, again, we all have talked to far too many parents, grandparents, brothers and sisters who have lost their beautiful sons and daughters, you know, grandsons, granddaughters, brothers and sisters. So, we got to do everything we can. So just thank you for your leadership. Likewise, thank you for your passion and leadership. Well, again, to the panel, thank you very much for being here. Well now turn to now. Weve got some real expertise here and some great Public Servants to talk through this issue and figure out how we begin to stop some of this poison coming into our communities. The first witness is joseph murphy, the u. S. Government lead for International Postal policy issues, heads the u. S. Delegations to the meetings of the universal postal unions, Postal Operations Council that weve spoken about previously. Mr. Murphy previously served for three years as the u. S. Permanent representative in United Nations office in nairobi. Robert cintron is with us, Vice President of Network Operations in april of 2016. In this position, he oversees the Postal Services distribution network, including Overall Network design, policies, and programs for processing sites, logistics, required to move the mail, and maintenance policies and programs that support that network. Mr. Cintron began his career 33 years ago as a clerk in rochester, new york. Thirdly, we have todd owen who is the assistant commissioner. He was named to that position in 2015. He oversees more than 29,000 employees, including more than 24,000 cbp officers and cbp agriculture specialists. He manages operations at cbps ports of entry and numerous programs that support national security. Mr. Owen began his career with the u. S. Customs service in 1990 as an import specialist in cleveland, ohio. Great start. William senor is with us. He currently serves as the acting Deputy Inspector general for the Postal Services office of Inspector General. He joined the Inspector Generals office in 2003. He previously served in both the United States secret service and in the air force office of special investigations as a special a agent. Daniel baldwin currently serves as a section chief within the Drug Enforcements administration. In this role, he supports deas global efforts in africa and asia. Prior this this assignment, he served in beijing, china, so he has good experience in china. In 1991, he received his bachelor of science degree in criminal justice from the university of denver. Finally, gregory is with us. Gregory serves as the Deputy Assistant director for the illicit trade, travel, and finance Division Within Homeland Security investigations, hsi. Mr. Nevano has oversight of all financial documents, benefit fraud, criminal gang exploitation, as well as several targeting infusion centers. Prior to this assignment, mr. Nevano served in i. C. E. Gentlemen, under the rules of this committee, we swear in all of our witnesses. Please stand and raise your right hand. Do you swear to the testimony that you give before this committee will be the truth, the whole truth, and nothing but the truth, so help you god. Let the record reflect that all witnesses answered in the affirmative. All of your written testimony, gentlemen, will be placed in the record in its entirety so i would ask you to limit your prepared remarks here this morning, your article testimony to five minutes. And mr. Murphy, well start with you. Thank you, sir. Chairman portman, Ranking Member carper, members of the subcommittee, thank you for the invitation to appear before you today to discuss our efforts to increase the availability of advanced electronic data for International Mail items. The universal postal union or upu is the Principal International venue where the department of the state discharges its responsibilities related to International Postal policy. So, my remarks will center on efforts underway within that body to expand the change of aed. These efforts have a long history, a key moment of which was the amend the upu to adopt and implement Security Strategies that include the principle of complying with requirements for providing electronic advanced data. Developing the implementation measures for this amendment has been a top priority for u. S. Delegations at upu meetings ever since. Our efforts, which include many hours of work by colleagues at usps and the department of Homeland Security are now bearing fruit and there has been recent rapid progress on this front. In february of 2016, the upus Postal Operations Council, the poc, adopted regulations for the 2012 Convention Amendment and also a road map for the implementation of those regulations. The United States cochairs with india the postal Operations Committee that oversees much of the work required to reach the road maps milestones. These milestones include final adoption of the technical messaging standard for item level data and the poc met this goal when it approved an item attribute message standard in its most recent meeting last october. In combination, these two developments, the regulation and the standard, enable upu member countries to impose requirements for aed. Upu members must do so, however, in a manner that is consistent with the real world capability of the global postal network. Accordingly, the focus is now on building capacity. At the global level, this entails building out other elements of the upus messaging and data flows. This work is progressing well, but will only have utility if the postal operators develop the capability to collect the data and to use the tools available to them. The needed in investment in skills and technology is happening and it is being greatly helped by a sea change in attitudes which has come to understand that Communications Tools are essential to the future of the postal sector. Consequently, members have endorsed several initiatives aimed at positioning posting operators in developing countries to exchange aed. For example, over half of the upus Development Cooperation budget for the 2017 2020 period is devoted to a project that aims to make posting services in developing countries operationally ready for ecommerce. This project has, as one of its Key Performance indicators, the goal of supporting 80 postal operators to be exchanging aed for some portion of their flow by the end of 2020. In addition, the upu is almost implementing a second project focused narrowly on security with an emphasis on capturing and transmitting aed. Participants in this project, all developing countries, are selffunding with money that was held in trust for them by the upu. The integrated product plan, or ipp, which the most recent upu congress adopted will also help accelerate aed exchange. The ipps goal is to modernize the upus Product Offerings can i ask a favor . Im not very good on acronyms. U. P. S. , im pretty good on that. Fbi. Im pretty good on that. Dont use so many acronyms. Actually say the words. Yes, sir. All right. Be an admonition for everybody else as well, okay . The within your five minutes. Universal postal union. The integrated product can i use upu . All right. Okay. The integrated product plans goal is to modernize the upus Product Offerings to better meet the changing needs of customers and supply chain partners. Phase one facilitates the exchange of aed since one of its advanced electronic data since one of its provisions is a requirement to have a upu standard bar code label. Important work is being done but theres more to do, as senator carper mentioned in his opening statement. Although the upu has the stated goal of having all Postal Services with the ability to Exchange Item level data by the end of 2020, theres a difference between the technical ability to Exchange Data and the realized ability to collect and enter it. There is real rapid progress at the country and the global levels. Although the work of enabling all countries to comprehensively exchange the full range of aed is a longterm undertaking were confident that by 2020 the United States will be receiving aed for most of the mail entering the country. Thank you. Mr. Cintron. Good morning, chairman portman, Ranking Member carper, and members of the subcommittee. Thank you, chairman portman, for calling this hearing. Thank you. Mr. Cintron . Thank you chairman portman for calling this hearing. My name is robert cintron. I oversee the Postal Services National Distribution network, including its operations at the International Service centers known as iscs. Last may, i testified before this subcommittee on our effort to combat opioids in the mail, highlighting the collection and receipt of advanced electronic data known as aed. Together with our federal agency partners, were committed to aggressively and increasing aed for packages coming into the United States in order to improve the targeting and the illicit drugs and other contraband. In the past three years, the Postal Service has gone from receiving almost no aed on inbound shipments to receiving more than 40 as of december 2017. We are now testing data that will allow us to target more package volume from china. This data will result in a significant increase in the amount of aed the Postal Service receives by the end of 2018. Since january 2017, the number of countries sending aed to the Postal Service has grown from 8 to 23 and includes china and other countries of interest. We have prioritized obtaining aed from the largest volume foreign postal operators, which collectively account for over 90 of all inbound volume. We now require aed on packages where rates are established under bilaterally negotiated arrangements. We currently have Bilateral Agreements in place with postal operators in australia, canada, china, hong kong, and korea. Additionally, other foreign posts have entered into voluntary data sharing agreements to facilitate the exchange of aed, bringing the total to 56 countries. While the Postal Service and cpb have distinct responsibilities at iscs, these responsibilities complement our shared goal of fighting the importation of synthetic opioids. In september, the Postal Service and cpb completed a memorandum of understanding to solidify our interagency partnership. Additionally, the program initiated at the new york isc to use inbound aed to facilitate more advanced targeting by cbp has been expanded to all iscs. Over the last six months, the Postal Service has provided hundreds of thousands of records per day to cbp and expanded the number of countries and types of packages available for targeting. We have also implemented an automated process to identify targeted pieces, requested by cbp. Additionally, we provided further training to isc employees to reinforce proper processes for handling and presenting mail in accordance with cbp requirements as the Postal Service continues to advance mailsorting technology, these successes will grow. To further improve the federal governments coordination of oversight over Inbound International items, the Postal Service, cbp, and the fda formalized an interagency work group. The group is working on efforts to build capacity to provide aed, develop detection technology, continue information sharing, provide Technical Assistance for legislation, and improve physical and i. T. Infrastructure. We also continue to work in close collaboration with our Law Enforcement branch, the Inspection Service, which has seen significant improvements in its ability to seize fentanyl and synthetic opioids. From fiscal year 2016 through fiscal year 2017, the Inspection Service achieved a 375 increase in International Parcels seizures and an 880 increase in domestic parcel seizures related to opioids. In conclusion, we share your concerns about Illegal Drugs and contraband entering the country through the mail and commercial carriers. The Postal Service is committed to taking all practical measures to ensure our nations mail security and provide the American Public the best, most Efficient Service possible. Again, thank you for this opportunity to testify. And i look forward to your questions. Thank you, mr. Cintron. Mr. Owen. Chairman portman, Ranking Member carper, distinguished members of the subcommittee, thank you for the opportunity to appear today to discuss the role of u. S. Customs and Border Protection in combatting the flow of dangerous, illicit drugs into our country. As the unified Board Security agency of the United States, cbp plays a Critical Role in our nations efforts to keep dangerous drugs from entering our communities. Cbp interdicts drugs and other Dangerous Items at our ports of entry, including multiple mail and express courier facilities by leveraging advanced electronic data, augments systems and by using various types of detection technology, all as part of our multilayered riskbased approach to enhance the security of our borders. Since i last appeared before this committee in april of 2016, cbp, working collaboratively with the Postal Service and our Law Enforcement partners, has made strong progress in enhancing our enforcement capabilities and our effectiveness in the International Mail and express courier environments but more must be done. Recent Bilateral Agreements regarding advanced electronic data have increase cbps ability to target highrisk shipments. In april of 2016, cbp was receiving advanced electronic data an a limited basis from only eight countries. Today we are receiving data from 23 countries with another 6 countries in testing. Currently, cbp receives aed on over 40 of mail and work continues internationally to increase the volume and the accuracy of the aed provided to the Postal Service. Through these pilots, cbp has enhanced our automated targeting capabilities and has worked with the Postal Service to develop protocols to ensure that every shipment selected by cbp for examination is, in fact, presented for inspection. Last summer, cbp and the Postal Service signed a memorandum of understanding aimed at increasing the level of advanced electronic data while aligning inspection processes. In the past year, cbp has increased our staffing at the six main International Mail facilities by 20 and all cbp narcotic detection canines have now been trained to detect fentanyl, adding another detection capability at our ports of entry. Once detected, these substances must be positively identified. In the past 18 months, cbp has deployed identification testing equipment so that officers can quickly determine what the unknown substances are. The average fentanyl seizure in the International Mail environment is only 700 grams and arrives as an unknown powder. Cbp officers must have the Technology Enabling them to quickly and safely identify these unknown substances. Cbp has increased the availability of such testing equipment and is appreciative to congress for the recently passed interdict act which will allow us to add testing equipment and further strengthen our enforcement efforts. The fentanyl detected primarily arrives from china and is over 90 pure. Cbp has deployed the necessary personal protective equipment to safely inspect and process these narcotics. We have also deployed naloxone so if our officers our or canines are accidentally exposed to these deadly substances, we can quickly administer these treatments to save their lives. And lastly, substantive and timely information sharing is critical to the targeting of shipments containing illicit drugs. Cbps National Targeting Center collaborates with partners on a daily basis, including hsi, the dea, fbi, members of the intelligence community, and the postal Inspection Service. These investigative relationships are critical in delivering consequences to those trying to smuggle narcotics across our border. In closing, we are seeing an increase in interdiction as a result of the efforts that i have outlined. In fiscal year 2015, cbp seized 50 pounds of fentanyl in the International Mail and express courier environments. In 2016, 81 pounds of fentanyl were seized in and in fiscal year 2017, 335 pounds were seized. Already this fiscal year, at our largest International Mail facility at jfk airport, cbp officers have made more fentanyl seizures in the first three and a half months than they have in all of last year so despite the success, much more still must be done. We must continue to increase the level and accuracy of the advanced electronic data being provided. We must further refine our targeting capabilities while working with the Postal Service to ensure that every parcel distinguishes members of the subcommittee, thank you for the opportunity to testify today. I look forward to your questions. Thank you, mr. Owen. Good morning, chairman portman, Ranking Member carper, chairman johnson and members of the subcommittee. Thank you for inviting me. As background, our organization has conducted substantial audit work on inbound International Mail operations and security. Weve issued eight reports since september 2015 and made 21 recommendations to the Postal Service, covering areas such as enhancing systems and processes, providing better employee training and oversight, and improving coordination with cbp, other agencies and foreign posts. The Postal Service agreed with 18 of the recommendations and have already addressed 12 of them. We also have two ongoing projects focused on advanced electronic data and opioid safety preparedness at the Postal Service. In addition to this audit work, were building our Data Analytics capacity to find and prevent Drug Trafficking through the mail. For years, Law Enforcement has used data to find criminals and expose their networks. Early efforts focused on Financial Crime due to its complexity and the large data sets available and just as criminal misused Financial Institutions to commit fraud, todays drug traffickers are misusing the u. S. Mail. The Postal Service faces a number of challenges that private companies do not when dealing with illicit narcotics in the mail. For instance, the Postal Service is obligated to deliver International Parcels even though it did not originally receive them from the customers. The Postal Service receives limited electronic data about many of these parcels and the information it does receive is often incomplete or inaccurate. In addition, the sheer volume of inbound parcels the Postal Service handles far exceeds the private companies. The law requires a warrant to inspect the contents. This is a strong principle valued by the American Public. This principle is being exploit by the criminals. Its easy for illegal drug parcels to hide in all of that traffic. The data that the Postal Service uses can be used to sniff out suspicious parcels. Our acting Inspector General testified about some of our work in this area. She described a case involving an International Parcel containing fentanyl. It uncovered a postal employee who was facilitating elicit narcotics in florida. Our analytics worked on the seized fentanyl parcel identified 2800 additional suspicious parcels also sent through the mail. We have assisted other federal investigations involving these parcels. We identified a number of additional reshippers unknown to Law Enforcement and responsible for thousands of suspicious shipments. While supporting individual cases is useful, we are also dedicating resources to build tools to address narcotics issues more broadly. We recently completed the development of a tool to identify postal employees who may be stealing drug parcels or facilitating the delivery of drug parcels to criminal groups. Unlike legitimate customers, we have yet to receive our first complaint from a drug dealer that their parcel was missing. Historically we have had to rely on tips from cooperating defendants. Now, we are analyzing Postal Service data and looking for indicators to focus on carriers or routes where suspicious parcels are disappearing. Our initial use of this tool has been very encouraging and may revolutionize the way we tackle these kinds of crimes. We are building a tool to identify inbound suspicious parcels. We are hoping to share this with cbp to reduce the number of narcotics parcels that enter the mail stream. We shared some initial information and the results appear very promising. Combatting the shipment of Illegal Drugs is not a problem any one agency can solve. Crossagency collaboration and data sharing is critical. We need to identify and intercept these parcels before they are delivered rather than focusing on investigating after the fact. One part of the solution is using data effectively to uncover problems. Thats only half the battle. Resources to address the problems are needed. For example, our tool to identify employees, identify hundreds of suspicious postal routes. We are not staffed to address all of these immediately. The challenge is going to get worse as our budget gets smaller. This challenge isnt unique to our organization but highlights the need to strategically vest in the tools and people to combat this problem since data alone isnt enough. If were successful it holds great promise to help Law Enforcement and government focus on the areas of greatest impact. Thank you for the opportunity to discuss our work. I am happy to answer any questions. Mr. Baldwin. Good morning, chairman johnson, chairman portman, Ranking Member carper and other members of the subcommittee. I am a special agent, dan baldwin, with the Drug Enforcement administration where i provide support to offices in asia and africa. Prior to this, i was the country attache in china. It is an honor to speak with you with International Cooperation and deas enforcement efforts to combat the Opioid Crisis. In addition to my written remarks, there are two things id like to touch on this morning. The enormity of the problem and what we are doing to address the threat. First, the problem. Over the last several years, dea has encountered a dangerous new trend, the convergence of the Opioid Epidemic and the synthetic drug threat from china. In 2016 alone, 42,000 americans lost their lives due to an opioid overdose. We all likely know someone who has been affected. This is fueled by fentanyl, which is cheap to make, hard to detect and dangerously potent. It can be purchased for 5,000 and the profits of that kilo can exceed 1. 5 million. It is often smuggled across the u. S. Mexican Border or sent via express mail from china. 2 milligrams of this substance is potentially deadly. Oftentimes, users dont even know they are taking this lethal drug. This leads me to my second point, countering the threat. Deas mission is to disrupt and miss mantle the highest priority Drug Trafficking threats. For decades, we have maintained a worldwide presence to take the fight to the source. In this case, china is the primary source of both fentanyl and the precursors used to make it. Over the past decade, our relationship with china has progressed. As recently as three years ago, many of the synthetic drugs we were encountering in the United States were not controlled in china. They had no Legal Authority to assist us in our investigations. However, through continued engagement by dea and doj, highlighting this deficiency, it has additional legislation passed in 2015. China controls ten substances and 116 new substances. U. S. Seizure data shows us that chinese control has an immediate effect on the availability of these drugs in the United States. We are also encouraged by recent discussions with chinese drug control officials and the prospect of scheduling fentanyl as a class. This would eliminate the need to control fentanylrelated substances one by one. U. S. china collaboration and investigations has also seen some improvement. Of note, in 2017 the department of justice indicted two chinese nationals responsible for manufacturing and distributing illicit fentanyl in the United States. They have been designated as consolidated priority targets, deemed the most significant drug traffickers by the department of justice. The dea and agencies coordinate with the National Targeting Center to enhance investigations in the sharing of information. One outcome was the recent takedown of alpha bay in 2017, one of the largest known dark net markets facilitating the purchase of illicit fentanyl. Going forward, the dea 5 anticipates the opening of an office in china later this year. It will facilitate greater collaboration along the border where fentanyl and other drugs leave china en route to the United States. Dea has seen some progress working with our chinese counterparts and we are hopeful that this relationship will continue to improve and develop. Here in the u. S. , we will continue our collaboration and are passionate about our cause and driven by those families and individuals that have been directly impacted by this crisis. Thank you for the opportunity to testify before your committee on this important issue. I look forward to your questions. Thank you, mr. Baldwin. Good morning, chairman portman, chairman johnson, Ranking Member carper and distinguished members. Thank you for the opportunity to discuss the Opioid Crisis in the United States and the efforts of u. S. Immigration and customs enforcement, Homeland Security investigations to disrupt, dismantle and bring to justice the criminal elements responsible for manufacturing, smuggling and the distribution of dangerous opioids. As the largest Investigation Agency within the department of Homeland Security, i. C. E. Homeland security investigations enforces more than 400 criminal statutes. They use this authority to investigate crossborder activity and work in close collaboration with u. S. Customs and Border Protection, the Drug Enforcement administration and the United States and postal Inspection Service in a unified effort with both domestic and international Law Enforcement partners to target Transnational Criminal Organizations supplying dangerous opioids to the United States. I would like to highlight our efforts, specifically fentanyl, coming into the United States through International Mail facilities. Based on investigative efforts, the United States Law Enforcement has identified china as a primary source of the u. S. Illicit opioid threat. Their precursors are most often produced in china and shipped by mail carriers directly to the United States or alternatively to mexico. Once in the western hemisphere, fentanyl or its analogs are prepared and mixed into the u. S. Heroin supply domestically or pressed into pill form and then moved to the u. S. Market where demand for prescription opioids and heroin remains at epidemic proportions. Mexican Transnational Criminal Organizations receive shipments of fentanyl directly from china to supply the illicit u. S. Market. They utilize existing smuggling routes and a u. S. Based infrastructure to get them to the end users. Fentanyl seizures from mail facilities are higher in purity levels and often unadulterated. The majority of fentanyl in the International Mail environment is shipped in purity concentrations of over 90 whereas the majority of fentanyl in the land border environment is seized in purity concentrations of less than 10 . We can easily purchase illicit opioids like fentanyl online and have it shipped directly to their homes in the United States, no different than any other ecommerce commodity. They recognize the vulnerability of the mail system and exploit the great volume of mail transiting into the United States as a means to further their criminal activity, recognizing the need to proactively target online fentanyl trafficking, the i. C. E. Cyber crime center is identifying ongoing investigations facilitating the coordination of online undercover investigations. I. C. E. Is fully engaged with the dea special operations, cbp National Targeting Center to identify shipment routes that may contain opioids and to fully exploit financial and investigative intelligence. Our Border Enforcement Security Task forces are i. C. E. s primary platform to investigate opioid smuggling. They operate in 57 locations. In response, i. C. E. Established an area in memphis, tennessee, embedded in an International Mail and 69ment facility. It targets opioid shipments on a daily basis and engages in control deliveries of illicit parcels to identify end users to disrupt and dismantle regional smugglers. It will continue to expand the best platform to enhance our nationwide efforts. I. C. E. Has made significant strides in fiscal year 2017 in combatting the fentanyl epidemic in the United States as evidenced by a 400 increase in fentanylrelated seizures. However, even with these advances, there is no single solution or Government Entity that can stop the flow of dangerous and illicit opioids like fentanyl into the United States or keep them from harming the American Public. Tackling this complex threat involves a united, comprehensive and aggressive approach across Law Enforcement, interagency lines and collaboration with experts in the medical, science and Public Health communities. I. C. E. Will continue to improve the informational sharing to address challenges and threats posed by illicit narcotics smuggling in the International Mail environment. I would like to thank you for the opportunity to appear before you and look forward to answering your questions. Thank you. I thank all the witnesses. We are going to have lots of questions for you. We have a number of senators that are here that are not going to be able to stay for the entire time. I will be here for the entire time so i will be very brief and then turn it over to them and have an opportunity to ask more of our questions later. Let me say to summarize what you are saying. Mr. Navano talked about the need for this to be an aggressive approach. I must say i have not seen the urgency over the past many years. We talked about the state department for ten years now, weve been talking about this with our international partners. We have evidence that we were able to uncover that it is still not going at the rate that we would like. We know there are over 300 million packages coming here without any data. We need that to be able to stop it. My questions will be along those lines to give you the opportunity to think about it. With that, i will turn it over to the Ranking Member and give everybody an opportunity to ask questions and well have as many rounds as we need to get all the information out today. Thank you. Anybody here that needs to have some urgency to be in two places at once and you would like to go ahead . No. Go ahead. Senator langford. Gentlemen, i appreciate you being here and the testimony that you have. Let me run through a couple of different questions. Mr. Murphy, you had mentioned by the end of 2020 the advanced electronic data, we should be capable of gathering that. Then you hesitated and said just because were capable doesnt mean we are actually doing it. Help me understand the next level of that. When are we actually gathering the data by the end of 2020, not just capable . Thank you, senator. Thats correct. What is happening is that the tools are being put in place and capacity is being built so that countries have the ability if they have the data to send and receive it. The bottleneck is at the country level in collecting the data and entering it. Whats the time frame for that . That is yet to be determined. Is that 2025, 2030. Help me understand that. Countries are going to begin deploying requirements for aed, as they are now entitled to do. Those requirements need to be calibrated to the capabilities of the sending countries. It is going to be a driver of further deployment. There isnt at this point a Firm Deadline by which every country must be able to send that. The deadline is the capability by 2020 but no deadline for when they actually have to do it. There is no deadline established at this time, senator. How do we get that . I think we need to be guided by our own information needs as we assess what it is we want to ask for and then tailor our requests around the capabilities of partners to ensure that we get customs and Border Protection the information theyre looking for in a timely way. Mr. Baldwin and mr. Navano, a question for either of you. I am trying to work through the process of not just picking up not only the seller, which is exceptionally important to this, but also the buyer that this is headed towards. How do you start to break out and say this is a very small amount of fentanyl, looks like a user, or this is a larger amount and we need to track the seller and buyer because this could be a street distributor. How do you balance that out and work through the process of the interdiction and the enforcement aspect of it . Senator, thank you for your question. In regards to identifying the different players in this process, we have, of course, our offices overseas that are working directly within the supply chain as far as the supply from china. We work here in the United States and we have our agents identifying leads, either from cbp or postal or our own investigations. We then are providing those back to china. We are identifying the entire chain. Of course, the goal is to identify the largest level suppliers, the suppliers from china, so if we have an individual who is sending mull thousands of packages, it makes the work down at the end of the table much easier by eliminating the one shipment. It would seem like if you are ordering it online, you have an i. P. Address. You probably have a city location or a region this package is coming from when it was dropped off. There seems like there would be multiple markers, the financial transaction that occurs when the exchange happens. It seems like you would be able to narrow the focus somewhat of where its coming from. You have the address of the person that is purchasing it here, because thats where it is being delivered to. Senator, you hit on how i was going to respond. Relationships with Financial Institutions is key in being able to track the financial transactions, both on the receiving and sending end. So we have established relationships with Financial Institutions that allows us to track the flow of the funds going from the purchaser to the person on the other end who is actually selling the elicit opioids. That is key. Do we have any incentives for other nations to be able to cooperate with us. When we are trying to interdict this, it is millions and millions of dollars obviously in the transaction at times and certainly for the larger dealers. Is there any incentive for those other nations to cooperate with us to be able to share that information . I would defer partly to that to dea. From the hsi perspective, we have tried to establish relationships with Foreign Countries, with intelligence sharing and working with our Law Enforcement partners to establish mutual relationships to show the benefit of how it can interdict a package before it comes into the United States and that is ultimately what our goal is. If we can push the borders further out to not have the package come into the United States, that would be our goal. To follow up, senator, and add some more to that answer, countries, at least china, has an interest in working with us to try to address some of the stuff coming out of china. There is a potential this threat, these drugs could be used by their own people. They are not seeing that but certainly are recognizing the potential of that. We have certain mechanisms within dea and the department of justice where we are engaging them on a regular basis to assist us in getting them to help us with this problem. Those are things we work on on a daily basis and annually. We have meetings to try to push our asks to the chinese. In order to get them to come to the table to do more in regards to addressing these substances coming out of china. Switch countries on you real quick. Mexico you have mentioned, the precursors are coming to mexico. We also have mexican production facilities to where they are shortcutting china instead of having it delivered from china, getting it straight to mexico. Whats the cooperation with mexico like right now for that as well . Senator, in regard to deas cooperation with mexico, it is good. We have seen within mexico this substance move into mexico where it is being produced. As was said in the opening statements, the percentage and purity of the substance coming over the border, on the southern border, it is a lot less than it is coming through the mail service. We are also looking to try to bring both mexico and china together to collaborate on this issue and deal with those substances, the precursors that are going to mexico that are then coming into the United States. Those are one of the things we are working on. We do have a decent relationship with our folks in mexico to deal with this problem. We want to make sure they are working with china to make sure they address the threat they have in their country as well. Thank you. Can i make one quick comment . Thank you for allowing me to be able to go quickly on this and get to the next meeting. I also want to be able to highlight the Inspector General for the Postal Service, not only for the work they have done and the reports they have done. Many people may not know but the senator hide camp and i have worked on this for quite a while. The Postal Service Inspector General has worked with all Inspector Generals to pull together a website called oversight. Gov that is getting out all the i. G. Reports out for every single group. They are not named on that but their team was a major player on getting those reports out and thats exceptionally helpful to all of us. Publicly, we come at you with questions a lot but let me also say thank you for that. It is not related to this hearing, but it is valuable to all of us, so thank you. We had a side bar conversation about this a moment ago. The Postal Service is not running out of money, theyre out of money. Theyre heading for what we call bankruptcy. We have an obligation, cothis committee and this congress to enable them to better ensure the delivery of fentanyl and these narcotic drugs is diminished and hopefully eliminated so thats a timely remainder on another front. Im going to ask, i like i want to ask each of you to go one by one, start with you, mr. Murphy, one thing we can do to help you and your folks do a better thing. One thing we can do. It might be something were doing. Something we need to do better. Growing up in west virginia, my dad would say a job worth doing is worth doing well. Out of that i took the idea that everything i can do, i can do better. What can we do to enable you and your folks to do a better job . Senator, the attention that the issue has gotten domestically is something thats noticed internationally and the higher profile of this issue is useful bureaucratically, certainly. Personally in my work i appreciate the attention the issue as received, so thank you. Senator carper, we would be looking for comprehensive postal reform. That would be tremendous. Thank you. As with the sexponential growth, additional staffing would help us as well as the continued support of the analytical work that were doing as well as our lakt and Scientific Services folks. We have talked about how this is a strategic problem. I think having governors on board for the Postal Service would bring both of those in addition to the leadership theyre already receiving in the Postal Service. A timely point there are raised, there are no governors on the postal board. Imagine the second Largest Corporation in this country operating without a board of directors. Thats essentially where we are. And its i just unconscionable. We have three nominees from the administration, we need another one. Ill be meeting with someone originally nominated by barack obama, who i think would be a very good candidate. It would be two democrats, two republicans and have a quorum to go forward with it. A wonderful point and a timely point, thank you. Mr. Baldwin. Can you be more specific . Specifically, our priorities are outlined in our 2018 budget proposal, the administrations budget proposal. As those are prioritized by people much smarter than we, i would ask we prioritize those budget proposals. In regards to the specific threat, we have a number of things in regards to scheduling, scheduling actions, scheduling controls, those types of things that we would look at to better address this threat as we see it. All right, thanks. Senator, i want to thank you for the resources that congress, you know, gives us both in budget as well as personnel. But with more we can do more, so my answer would be resources. The more resources, the more special agents we have, the more staffing we have would allow us to do our job more effectively. Thank you. I mentioned several of you mentioned china. I think almost every one of you mentioned china. About two, three years ago the president of china was coming to the u. S. And was going to meet with president obama. I think they met in washington state. One of the things that was raised by president obama was an issue raised with china any number of times before. That was our unhappiness actually anger with their allowing folks within china to launch these hacks. And to come after our intellectual property and money and a number of other items and things of value. Every time we raised this with china, they would say, nobody who is responsible for this is doing it. It is into the the Chinese Military or part of our government. It is just happening, and different people are doing this stuff. We didnt believe them. When president barack obama met with president xi about two or three years ago he raised this issue. President xi said, it is not us. It is rogue elements within our country that are doing this. President obama said this is who is doing it. This is where theyre located, these are the people. If you dont do it something about it, you are going to find it much more difficult to sell your goods, and products and services in this country and president xi acknowledged that they could help and they have. And they have. They havent stopped all the hacks from china but it has slowed them down. We had a similar experience with iran. Iran for years was trying to shut down our banks. Get on their websites and shut them down. A week after we entered into a comprehensive agreement in iran on not developing a nuclear weapon, guess what stopped . The attacks on our banks. When you think about root causes, it is not just working on the appetite we have for Illegal Drugs, like these opioids, but there are others as well. Lets focus on china. I said earlier, we are going to reach out to the ambassador to china hoping some colleagues will join us to ask them what are they doing and what do we need to do to address the root cause from your end. Mr. Baldwin, why is it important that we engage with china. Please give us an update on cooperative efforts with your counterparts in china to help identify the sources of fentanyl appeared other synthetic opioids. Senator, thank you for the question. Put quite simply, the reason we have to engage with china is because, as anybody who has changed oil in their car, we know the big side of the funnel and the small side of the funnel. China is the small side of the funnel. Thats the place things are originating. We need to get to packages before they get to the United States and branch out to a thousand different locations within the United States. We can try to track every package. We can try to address every threat, every trafficker within the United States. If we can get to the small end of the funnel, and attack some of those distributors within china that are sending tens of thousands of packages to the United States, we would have a greater impact. The importance to work with china is just that. We have the ability to do that along with them. Thats fed by information from cbp, postal, our partners at hsi. We identify packages here and the shipping origin and take the head off the snakes. Thanks for the response. Well have a second round and ill revisit this with others on the panel. Chairman johnson. Mr. Chairman, this is really for mr. Baldwin or mr. Navano. I read an article that about 800 worth of precursor ingredients produces about 800,000 worth of street drugs. Is that close to true . Senator, i would say that is an accurate assessment. We know that the profit margin in fentanyl is much higher than heroin. So your statement is accurate. Obviously, where there is a demand, it is going to be supplied with that kind of profit potential. I want to talk about the difference between im not going to hold you to these figures. Can you give us some sort of sense. What percent of the fentanyl is coming in through mexico and how much is coming in directly through our postal system . I will talk about the purity differences later. Give me some kind of sense. Im not sure if my colleague at cbp might be able to answer that better, senator. Whoever can best answer these questions, hop right in. We are seeing larger from the southwest border. 854 pounds of fentanyl was seized on the land border. 335 pounds were seized in the express and mail environment. Much higher quantities but lower purity. Why the difference in the purity . Are they cutting in mexico to be used immediately or the practicality to ship smaller quantities . The seizures we see, the fentanyl is mixed with other narcotics, other hard narcotics. In the mail environment, it is a single shipment of the fentanyl, pure, by itself. The stuff coming through the postal system, is that getting sent to other labs to be process processed, cut further to that i can that 100 purity generally when somebody is abusing fentanyl, what percent purity is in that tablet . I think you have hit on something crucially important. We have two threat areas, the southern border, potentially where there is a precursor for making fentanyl, found and producing fentanyl there. It is adulterated into the other Illegal Drugs being pushed across the border. We have the mail stream, as you said, that has a higher purity. Those are being used at times in the United States in what we call pill mill operations, where that fentanyl is pushed into a fill, which is a counterfeit bill, which look much like those similar pills that drove the Opioid Crisis to begin with. The dosage amount is 1 milligram. 1 milligram of fentanyl, if it is 98 pure, 1 milligram is 1,000th of a gram. There is a thousand grams in a kilo. There are 1 million milligrams in a kilo. That is in the pill mill operation process. It almost sounded like they were just users directly buying that. Is that also the case . Or is it almost 100 of the case where these things are being shipped to some kind of pill mill . Senator, like any other ecommerce commodity right now, end users can actually sit in their living room and order these illicit opioids online. Would they be getting 90 purity snt. That is accurate, sir. 7 is that why they are dying so quick . That would be accurate. I want specifically what would you like to see china do . Specifically. Are they not investigating . Are they turning a blind eye . Specifically what would you like them to do . Thank you for the question. Working in china of course has its challenges. There are things that china has done back in 2015, as i mentioned, they changed their law to where they were able to adapt to a threat in a third country. So in the United States if we have an abuse of a certain substance thats not controlled in china, their law is now adapted to where we can take that abuse data and provide it to china where they can then change their law. Dea has a mechanism that is set up where within our chemical evaluation section within dea headquarters, we are evaluating different substances, the harm and effect it is having on the American People and providing that information directly back to china for their action. When you ask what i want china to do, i would like them to continue down that road. They have taken it seriously. They have controlled a number of different fentanyls. We have prioritized fentanyl information provided to the chinese. They have actually controlled our top four asks. We want that dialogue to continue. We are hopeful it does. We want it to get better and better. We want our experts to meet on a regular basis and exchange this important information. Again, this is something that we can do to directly address those threats here in the United States with china. So it is not a glaring omission, its just a matter they are doing good things, they just need to do more of it. Is that absolutely. I think thats one aspect of what they can do. It is one piece of the puzzle. Again, there are multiple problems here, multiple facets. One of the problems really are the analogs and our inability in our law and probably chinas law as well, keeping up with the minute change in the chemistry of these things. Thats why we introduced the sofa act and dea has tried to do that through their regulatory powers. Theyre a little concerned they may be butting up against their own legal requirements. Can you talk about the need to codify that . Thank you for that question, senator. I am not familiar with all the details within the sofa act. I am aware of it. I am certainly we, of course, if we have another tool thats provided to dea for us to deal with this problem, thats the act that gives us that tool, we are happy you are constrained right now in terms of rapidly scheduling one of these analogs, correct . We have existing authorities to move forward and schedule substances. That is not something im intimately familiar with. I am within the operations division. We have the planning evaluation folks, the people in the chemical section, that do this on a daily basis. If we have tools offered to us in whatever bill, we are happy to work with you to try to assist you in moving that bill forward. Just real quick. I was very pleased to hear that you have actually trained dogs in fentanyl. I thought if you did that, they would die. Thats very good news. How many more canine units do you need . Id ask you just in general. I think we are all very supportive of it on this committee. For this particular task, how many could you use . We can always increase the resources at these facilities. It is important when congress has supported us before with canines, that it also seems to come with the handler. Right. A lot of times a canine comes by ifs. Itself. A unit. Any support we can get in that would be helpful. We currently have just under 500 dogs working at our ports of entry. Any enhancement would decrease increase our detection capabilities. They are detecting all kinds of things. Is it a specific dog for a specific drug. We have a narcotics detector dogs that can enter six types of narcotics and dogs that detect currency and firearms for our outbound threats. So the dogs are split. You are able to add fentanyl to that . Yes. Thats impressive. Thanks for your service. On the followup on china, quickly, dea and justice recently indicted two chinese nationals, as was widely publicized. They indicted them because they were using the mail to ship large amounts of fentanyl to the United States. So the question is, what can china do . Its fine to schedule these precursors or things that go into making fentanyl or the analogs, which is a good idea, but its about actually taking action and prosecutions. Let me ask you, mr. Baldwin, about those two individuals who were indicted. The Justice Department and the dea were involved. Have they been prosecuted . Thank you for the question. The current status, i am not absolutely certain where they are within the system within china. I do know this. I do know that the traffickers and the shippers of these substances from china are very creative. If they have the ability and you probably learned this with your own inside investigation, if something is controlled, they usually divert to another substance thats not controlled. Let me just back up for a second. I understand the challenges and we talked a lot about that. There is also a transshipment challenge and so on. I asked you a specific question. Have those individuals been arrested and prosecuted . The answer is, no, unless you are going to correct me . No, they are currently not in custody. So thats the answer, the answer is no. So to the chairmans good question about what could the chinese do, how about prosecuting these two individuals that you all have indicted . Two individuals out of the thousands of labs in china that are sending this poison into our communities. That would be a good step. If i could just have a moment. To follow up, the chinese have to feel like they have a dog in this fight and some would like to see us further weakened as a nation. And our continued use abuse, overuse of these harmful narcotics weakens us. There are enormous amounts of money to be made, money that is going to flow from this country to their country. Somehow they have to be made to believe or understand that they have a dog in this fight. Partially, it is to say, maybe the customers for these drugs may be your people, not just ours. When the president of the United States meets with the leader of china, it is important that this be at or near the top of the issues that are raised. Thank you, mr. Chairman. I think this is the third or fourth time we have been in this room talking about this. I have to tell you, this investigation reminds us that we are not doing everything with a sense of urgency that we need to do. I recognize yall are working really hard on this, that yall want to see success. We have to be more urgent about this. We can build a 20 billion wall. If we dont solve this problem, we will not have solved the problem of interdicting drugs. If we simply focus on china, we will not solve the problem of interdicting these drugs. If we simply focus on mexico, fentanyl in my state that killed kids, that led to a huge investigation, one of the first, came from china to canada, to portland, oregon, to north dakota. Last time we were here, we talked about treaties. We talked about the need to work government to government with authorities like mr. Owens to try and see are the treaties stopping us from doing what we need to do. Are we on the right path . And i want to expand this discussion because its not just about drug interdiction. Mr. Owen, you have made such a great point about ecommerce. As ecommerce grows, this problem will get worse and worse. It is going to be counterfeit goods and avoiding goods that may injure from a Consumer Protection standpoint, whether it is lead paint in toys. Whatever it is, we need to have our laws enforced that protect the public safety. So we are failing and we are failing because we have understaffed and underresourced the post office. I think it is pretty clear. We are failing because we havent worked in a government to government way to really close the loopholes. This isnt just about drugs but its about all of ecommerce. As the states, and i think that the court will probably give the states the ability to collect sales tax, theyre going to have some skin in the game because it may drive some offshoring of ecommerce to avoid sales tax responsibilities in some states. Those of us that live on the border understand the complexities of working to make sure we are not shutting down commerce but that we are, in fact, protecting Public Health and safety. Now, mr. Baldwin, one of the questions that i have, you have described the funnel, right . We want to get to that point. A lot of talk about china. How easy is it if we have got 100 complete cooperation from china, extradition or prosecutions, whatever it might be, for that to be offshored, moved someplace else, given the high profit margin that mr. Navarro described and chairman johnson described, how difficult is it . If we simply say we are going to focus all of our attention on that one point of development before it expands up to the points of entry into this country, how difficult is it to move that around the world, mr. Baldwin . Senator, thank you for your question. The angers to that is its very easy to do. There are multiple countries that stand ready to take up where china would leave off. Why not if you are looking at that kind of project margin. So i think its really important that we not spend all of our time here simply focused on china. We have to understand because of what chairman johnson and at the time chairman carper continue to talk about the insatiable appetite for these kinds of drugs, we have to understand that while we are trying to deal with demand, we cant let supply come in in the amount that it is because it has driven the street price down and it has created an opportunity for transition from prescription drugs to illegal street drugs. The pill, im glad you brought up, we have seized these fake oxies that are fentanyl. The people who are doing it do not have ph. D. S in chemistry. They are putting amounts in there that are lethal, never mind the destruction it does to the social safety net of this country. It is killing people. My request would be what are the strategies not just dealing with china, but what are the strategies to deal with these precursor problems to deal with all of this and how, mr. Owens, do we need to do a better job to give you the tools to interdict at the point of entry . I just want to make one point about how pervasive this can be. When i was attorney general, i ran the drug task forces. We need we had a huge drug problem. 90 to 95 of all the meth consumed in north dakota came in through mexico, it wasnt homegrown. We got a tip that there was a package with meth. We had probably ten packages. They hit on three. Thats what we know. We know we are just getting inundated. So what can we do working within our International Cooperation, renegotiate the postal agreements that we have, to avoid that limit you from doing what you need to do, mr. Owen, in terms of interdiction . We can target not only from china but as you mentioned as the threats shift and they start to trend shifts. In the ecommerce, they are looking at the space as an all threats environment. We have narcotics and trade compliance and Public Health and safety. Ecommerce growth, 1. 4 million parcels cross our borders right now. It is only going to continue to increase. The last time we were here, we heard over and over from the Postal Service that their treaties or relationships, international contracts, i think they are probably treaties, with other International Groups limit their ability to do interdiction. Is that still true . Because we have been at this a long time, we were told we cant use dogs, by dea last time, because fentanyl kills them. Now, we are hearing you are using dogs. We were told last time that the postal agreements internationally limit our ability to do work. Now no one can answer that question. We have got to get an urgency to this and weve got to deal with it not just about Illegal Drugs, but Everything Else that we expect to protect our borders. I want to thank you all. This is not the end of this. I want to thank the chairman for the excellent work that was done here. I think that we didnt reveal anything in this report that we didnt know. I want to point out that the two chinese individuals that were indicted were indicted in north dakota. We will hear later more from mr. Murphy about the issue of the international treaties, as you rightly called them and what the universal postal union challenges are. You are right. I dont think we have had any urgency. We have ten years going back and forth and all we have to show is a bar code. It is fine. There is a sticker. There is no information on the barcode for those countries for most packages. We do have to accelerate this as was said. This is an urgent problem. We need to be more aggressive. Mr. Chairman, the point that i want to make about ecommerce is that this isnt just limited. If we just simply focus on drug interdiction and on china, which is our immediate problem, well miss the opportunity to fix the broader problem or at least provide a broader sweep in terms of what we need on all of ecommerce, whether its counterfeit goods, things that violate Public Health and safety, whether it is in fact things happening to do tax evasion. Senator klobuchar. Thank you very much and thank you for inviting me to join today. This is something that i think this report is incredibly important and sheds some light on just what is going on here. I personally think while some of this information has been out here, its pretty stunning. I also want to thank the chairman. He and i are leading the bill to do something about this, the stop act, which would require shipments from Foreign Countries through our postal system to provide an advance electronic data before these shipments enter the United States. I got interested in this because, like so many other senators, i saw what was happening in minnesota. 637 deaths from opioids and other Drug Overdoses in 2016. That is more than the number of car crashes and homicides combined in my state. Almost 100 of these deaths, 96 of them, involve synthetics and nearly 80 increase from the Previous Year and 85 involve fentanyl and one of them was prince. It is not just celebrities that died from fentanyl but a lot of little kids, high school kids, college kids. We have to do something about this. I will start with you, mr. Owens. As you know, this bill would show us where the packages are coming from, who it is going to and where it is going and what is in it. How would this sort of information help customs and Border Patrol detect and interdict shipments of illicit drugs like fentanyl . Absolutely. It is critical we receive the advance data on all cargo shipments, including what we are seeing in the mail, prior to the arrival of those shipments, to use our analytical tools, past seizure records and the connections we make through our National Targeting Center and advise the Postal Service to present that parcel. A real life example from last week at jfk. We had a shipment coming from china, an epacket, one of their express packets. The advanced information was provided prior to arrival. We were able to target that shipment prior to arrival. Placed it on hold. The Postal Service presented it. When we inspected it, we had 28 grams of an unknown white powder. Using the Technology Equipment we now have deployed, we were able to identify it as fentanyl and work with our criminal investigative partners at i. C. E. And dea and the nypd and made a controlled delivery and take down three additional individuals and make an arrest at that facility. The pill presses and all the equipment to further manufacture and distribute was there as well as two m4s. Two highpowered weapons that were part of that. That is just one example. Only 28 grams of fentanyl but it started with the advance information provided prior to arrival of the cargo allowed us to target based on some rules we have in our systems and connections to previous seizures and allow us to deliver consequences with the criminal investigators to take people into custody. Thats a great example initiated from jfk as to how this process should work. Exactly. So tell me the challenges, though, and why it isnt working everywhere. The challenge is the advance information is what we need. We need to have that prior to arrival. It needs to be accurate and timely. Again, thats an area as youve heard this morning we are working on very closely. We have made a lot of progress but theres still a lot of work to go in this regard. Can you tell us about the trend in terms of the amounts of synthetic opioids including fentanyl that bad actors are shipping . This problem came to light years back. We continue to see increased interdiction the both in the mail and the express environment. Last year of the 335 pounds that we did sees, 92 pounds were in the mail environment and 240 pounds were in the express environment. So it is a threat through both pathways, also through the Mexican Border. Less purity on the Mexican Border mixed in with other seizures of other hard narcotics. But the trends continue to go up as all of the changes that we are putting in place are making us more effective, we will sees more in 18 than we did in 17, but really with that volume that were seeing at the borders, interdiction can only be part of the solution because the volume is too overwhelming to think we will stop this simp simply at the border. And you and mr. Sentron talked about the fact that 23 countries are sharing this advanced electronic data with the u. S. You said that we are now working to increase the number. How do you do that . What are your hopes of doing that . One of the ways we do it is through collaboration. Thats kind of been our focus right now, when you think of where we have been with aed, from 0 to 40 . We have moved from 8 to 23 countries and signed 56 datasharing agreements. So our focus has been on the top countries. You have heard us talk about that. It represents 90 of the volume coming in. We have a big push this year in terms of aed, china as an example. Untracked volumes will yield a significant amount this year of that aed volume. Our target by the end of the year is to hit about 70 aed, just by focusing on that and our partner right now. We are seeing data coming over. The focus is collaboration and collaboration also by the Law Enforcement agencies to help out and for us to focus on those countries. I think when we see these numbers coming in and im from the state thats known for doing a lot of treatment. We think it is really important. Thats part of the season senator portman and i and two other senators led the cara act which helped set a blueprint for our country. It is why i believe we need to get more funding in the budget upcoming for opioids. It is also one of the reasons that i think we need to do a better job of policing what the Drug Companies have been doing in terms of getting people hooked on this. This issue is something that is just getting worse and worse with fentanyl. It is up to 100 times more potent than morphine. We are seeing an increase in car fentanyl, 100 times more powerful. A dose the size of two grains of salt can be fatal. I ask you, the Postal Service, as we go forward, we are trying to gather support for our bill. If we can stop some of this i know it is not the only solution. You have to look at many things as senator heitkamp pointed out. This has to be part of this. The other thing i would add is something that senator graham and i are leading in our bill, the salt act, to make it easier to prosecute the sale and distribution of synthetics. As you know, these analogs, they basically take a chemical makeup, change it a bit and then its not on our list. So senator graham and i have a bill with a number of supporters on going through judiciary to make it easier to go after those analogs and be as sophisticated as the people that are trying to get people hooked on drugs that ultimately kill them. I want to thank the chairman for his great leadership, for this report. I hope it moves all of us to more action. Thank you. Thank you, senator. Thanks for your leadership on the stop act and more broadly on the need for more prevention and certainly more treatment and longer term recovery. Thats all part of it. If we can keep this poison from coming into our country in the first place, we need to do it. We know we can. What this report showed is if we are not doing what we can within our current budget restraint, i appreciate the fact that in response to senator carpers question, the answer was almost universally more funding, more funding. We will talk about this in a moment when i ask a question of you all. I want to let senator danes go. I dont disagree. More funding is important. We did just pass legislation to have monitoring equipment to detect fentanyl. Weve got other problems here, gentlemen. We are not coordinating well. We are not doing what we should be doing. Last year, we were able to get advanced electronic data on 36 of mail. That was the number from last year. It was the same as the Previous Year. Even during the year, you have a chart in your report you can see, it was flat. We are not doing what the commissioner told us he need, finding these packages to pull them offline and test them and get rid of this poison so it doesnt come into our communities and go after the individuals who are send them. Senator danes. Mr. Chairman, thank you. Thank you for your leadership, for you and what your staff has done to produce this report. Were seeing this in montana. Looking at the map up here, if you look at montana, there is not a lot of color on it. Ill tell you, it is costing our state dearly. In fact, in 2015, 35 mon ttanan died. This continues to drain fiscal resources that could otherwise be spent on other services. I was struck by the council of economic advisors issued a report last november and i was struck by the council of economic advisors issued a report last november and estimated the economic losses are over half a trillion dollars in 2015 alone. What the chairman just mentioned, we need to better our efforts on intercepting these shipments so that the United States Postal Service and cbp can prevent the distribution of opioids in the first place. Mr. Baldwin, in my days with procter gamble, i spent over 5 1 2 years working in china. I was one of the early pioneers that was sent over by p g to develop and grow our business and make Great American brands and produce and ship those to the chinese consumer. I understand a substantial amount of usps shipments containing opioids originates from china. It is not surprising you are here as the leading expert on china at the dea. Could you share with the committee chinas relationship with the dea . Certainly, sir. Senator, thank you for your question. Dea has had a presence in china beginning in hong kong back in the 70s. We sent Liaison Officers up to beijing on a regular basis to engage with the chinese. That relationship, as you know, having spent time in china, a longterm relationship in china is much better than a shortterm in the sense that you build rapport and understanding. You have the ability to ask more and get more done. It is important in regards to this threat. We have a directly liaison with the Narcotics Control Bureau in the republic of ministry in china, and they are a singlemission entity much like dea. When we come into a room, there are a lot of political issues out there potentially that could cause some problems for us. We see eye to eye in the sense that, hey, we both have a common mission. At least we can start there, right . Now, we have a country attache. Stationed of course fulltime in beijing and a numb eber er of o in quongjo. And we want to expand into the province where we will have direct engagement with the prudential Law Enforcement authorities who are the ones who are doing the work, and our goal is to build on the rapport and we know that our partners in hsi have partners as well. We are looking to expand the connectivity there with china and hoping that the office in quongjo is going to help. And excuse me, we have had lived in consideration uongjo and two children worn there. And so it interesting when you go back to the 1800s and the problem of the opium wars and this is a problem that goes back a long, long ways, and it is not new. Ive got to commend the chairman. Chairman portman came with us to china, and he was such a strong advocate in directly questioning the chairman there, about how do we reduce the source of fentanyl right there in china, being shipped directly into the United States. I was grateful for your leadership there, senator portman. You look at that map, just the devastation this has created in ohio and other places around this country. So i appreciate your work around the world as were trying to get to the root cause in stopping this scourge on our nation. Mr. Cintron last week in my home state of montana, the flathead beacon reported there was a couple employed there by the usps in polson, montana, that was caught distributing methamphetamine through postal shipments. Employees of the usps. A city there, its beautiful. It sits in the flathead tip, close to glacier part. The population is less than 5,000 people. The concern is that about a half a pound of meth could be shipped directly into this small community. I tell you im grateful for Law Enforcement officials. Their vigilance uncovered this operation, and we need to do more to stop the spread of this meth epidemic thats occurring in montana. My question is what detective and preventive measures is the usps taking to combat the shipment of meth in Rural America . Im going to as