Technically, it's perfect. The Chinese want Japanese passports because citizens of Japan don't need a visa to visit the U.S., while Chinese citizens do need visas. Those Japanese passports allow them to fly rather than sail to America's borders. A 14-hour flight is much safer than a sea journey of up to 14 days in a cargo container. One such container recently arrived in Seattle with three dead Chinese inside.
Japanese authorities are aware of the passport scheme, but smugglers merely avoid their watch.
The Chinese fly into a Japanese airport and stay inside the security area. There they are met, given a forged passport complete with forged stamps. Then it's just a matter of going to the right gate and catching the flight to the promised land. The smugglers carefully target their destination airports. Both John F. Kennedy and Newark airports are favored destinations for smugglers because they're so busy.