Mexican president demands proof after US accuses banks of laundering drug money
Mexican president Claudia Sheinbaum expressed frustration at US sanctions against three Mexican financial institutions accused of laundering drug money, and said the US has not yet provided any evidence of criminal activity.
'Until now, the treasury department has not sent any proof that indicates there is money laundering,' Sheinbaum said. 'We will act if there is proof.'
She then publicly requested the treasury department 'send proof, if they have it, so we can accompany them in the process'.
The US treasury department announced on Wednesday it was placing sanctions on three separate Mexican financial institutions, accusing them of being used to launder money for organized crime.
The three institutions identified by the treasury's financial crimes unit (FinCen) are the large commercial banks CiBanco and Intercam, and the brokerage firm Vector Casa de Bolsa. FinCen is accusing them of laundering money linked to fentanyl trafficking.
'Financial facilitators like CiBanco, Intercam, and Vector are enabling the poisoning of countless Americans by moving money on behalf of cartels, making them vital cogs in the fentanyl supply chain,' treasury secretary Scott Bessent said in a statement.
'Through the first use of this powerful authority, today's actions affirm [the] treasury's commitment to using all tools at our disposal to counter the threat posed by criminal and terrorist organizations trafficking fentanyl and other narcotics.'
Wednesday's announcement represents a further escalation by the Trump administration towards organized crime in Latin America. After Trump's inauguration, the administration declared a number of Mexican criminal groups as terrorist organizations.
Other actions by the US have led to friction between the Mexican government and the Trump administration. Earlier this year, the Trump administration imposed 25% punitive tariffs on many imports from Mexico, in an attempt to pressure the country to halt fentanyl trafficking and migration towards the US.
Additionally, the administration began revoking visas for some Mexican political figures, preventing them from traveling to the US. According to reporting by ProPublica, the administration has a list of a number of politicians accused of having ties to the drug trade, including allies of Sheinbaum.
The treasury department says its actions come after acts passed by Congress provided the department additional authority to target money laundering networks linked to fentanyl trafficking.
Fentanyl leads to tens of thousands of overdose deaths in the US every year. The drug is primarily manufactured in Mexico by criminal groups using precursor chemicals from China. It is typically pressed into pills, trafficked into the US and distributed nationwide.
According to Sheinbaum, Mexican financial investigation agencies received information from the treasury department regarding the three financial institutions and transactions with Chinese businesses.
Mexican officials, who viewed the evidence as insufficient, launched their own investigation and also requested further information from the US regarding the transactions.
Sheinbaum says the US did not follow up in response to Mexico's request.
'We are not going to cover for anyone. There is no impunity,' Sheinbaum said. 'But it has to be demonstrated that, effectively, there was money laundering. Not with statements, but with hard evidence.'
The treasury department, in its release, included different allegations against the institutions.
In one instance, the department said, a CiBanco employee created an account in 2023 to launder $10m for a Gulf cartel leader. In another case, Intercam executives in 2022 allegedly met with suspected members of the New Generation Jalisco cartel 'to discuss money-laundering schemes, including transferring funds from China'.
And in a third example, the department claimed that from 2013 through 2021, a Sinaloa cartel money mule laundered $2m from the US to Mexico through the Vector firm.
'CiBanco clarifies that it does not hold commercial relations outside of legality, and reiterates the compliance of all guidelines established by the relevant authorities,' CiBanco said in a statement on its website. 'CiBanco maintains constant communication with corresponding Mexican and United States authorities and underscores its willingness to collaborate.'
Mexican banks are not the only financial institutions accused by the US of laundering dirty money for organized crime.
Last fall, a US bank admitted to helping Colombian criminals launder money. The FinCen investigation led to a $1.3bn penalty, the largest penalty against a financial institution in history.
Last year, the justice department unsealed an indictment, accusing a number of people of laundering money for the Sinaloa cartel and for 'groups linked to Chinese underground banking'.
The multi-year DEA investigation, called Operation Fortune Runner, found that the alleged criminals used Citibank ATMs in California to launder drug money.
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The Guardian
13 hours ago
- The Guardian
Mexican president demands proof after US accuses banks of laundering drug money
Mexican president Claudia Sheinbaum expressed frustration at US sanctions against three Mexican financial institutions accused of laundering drug money, and said the US has not yet provided any evidence of criminal activity. 'Until now, the treasury department has not sent any proof that indicates there is money laundering,' Sheinbaum said. 'We will act if there is proof.' She then publicly requested the treasury department 'send proof, if they have it, so we can accompany them in the process'. The US treasury department announced on Wednesday it was placing sanctions on three separate Mexican financial institutions, accusing them of being used to launder money for organized crime. The three institutions identified by the treasury's financial crimes unit (FinCen) are the large commercial banks CiBanco and Intercam, and the brokerage firm Vector Casa de Bolsa. FinCen is accusing them of laundering money linked to fentanyl trafficking. 'Financial facilitators like CiBanco, Intercam, and Vector are enabling the poisoning of countless Americans by moving money on behalf of cartels, making them vital cogs in the fentanyl supply chain,' treasury secretary Scott Bessent said in a statement. 'Through the first use of this powerful authority, today's actions affirm [the] treasury's commitment to using all tools at our disposal to counter the threat posed by criminal and terrorist organizations trafficking fentanyl and other narcotics.' Wednesday's announcement represents a further escalation by the Trump administration towards organized crime in Latin America. After Trump's inauguration, the administration declared a number of Mexican criminal groups as terrorist organizations. Other actions by the US have led to friction between the Mexican government and the Trump administration. Earlier this year, the Trump administration imposed 25% punitive tariffs on many imports from Mexico, in an attempt to pressure the country to halt fentanyl trafficking and migration towards the US. Additionally, the administration began revoking visas for some Mexican political figures, preventing them from traveling to the US. According to reporting by ProPublica, the administration has a list of a number of politicians accused of having ties to the drug trade, including allies of Sheinbaum. The treasury department says its actions come after acts passed by Congress provided the department additional authority to target money laundering networks linked to fentanyl trafficking. Fentanyl leads to tens of thousands of overdose deaths in the US every year. The drug is primarily manufactured in Mexico by criminal groups using precursor chemicals from China. It is typically pressed into pills, trafficked into the US and distributed nationwide. According to Sheinbaum, Mexican financial investigation agencies received information from the treasury department regarding the three financial institutions and transactions with Chinese businesses. Mexican officials, who viewed the evidence as insufficient, launched their own investigation and also requested further information from the US regarding the transactions. Sheinbaum says the US did not follow up in response to Mexico's request. 'We are not going to cover for anyone. There is no impunity,' Sheinbaum said. 'But it has to be demonstrated that, effectively, there was money laundering. Not with statements, but with hard evidence.' The treasury department, in its release, included different allegations against the institutions. In one instance, the department said, a CiBanco employee created an account in 2023 to launder $10m for a Gulf cartel leader. In another case, Intercam executives in 2022 allegedly met with suspected members of the New Generation Jalisco cartel 'to discuss money-laundering schemes, including transferring funds from China'. And in a third example, the department claimed that from 2013 through 2021, a Sinaloa cartel money mule laundered $2m from the US to Mexico through the Vector firm. 'CiBanco clarifies that it does not hold commercial relations outside of legality, and reiterates the compliance of all guidelines established by the relevant authorities,' CiBanco said in a statement on its website. 'CiBanco maintains constant communication with corresponding Mexican and United States authorities and underscores its willingness to collaborate.' Mexican banks are not the only financial institutions accused by the US of laundering dirty money for organized crime. Last fall, a US bank admitted to helping Colombian criminals launder money. The FinCen investigation led to a $1.3bn penalty, the largest penalty against a financial institution in history. Last year, the justice department unsealed an indictment, accusing a number of people of laundering money for the Sinaloa cartel and for 'groups linked to Chinese underground banking'. The multi-year DEA investigation, called Operation Fortune Runner, found that the alleged criminals used Citibank ATMs in California to launder drug money.
Reuters
14 hours ago
- Reuters
Mexican regulator takes over running of banks hit by US fentanyl sanctions
MEXICO CITY, June 26 (Reuters) - Mexico's banking regulator will temporarily step in to replace the administration of two banks sanctioned by the U.S. for alleged involvement in money laundering linked to organized crime, it said on Thursday. The nation's banking and securities commission said it will intervene in the operations of CIBanco and Intercam Banco to protect the banks' creditors and depositors. The move comes a day after the U.S. Treasury prohibited certain transactions with the banks, as well as brokerage firm Vector Casa de Bolsa, under new fentanyl sanctions. All three firms deny the allegations. The sanctions effectively cut the institutions off from the U.S. financial system and could have a significant impact on Mexican banking, given the interconnectedness between lenders and close trade ties with the U.S., experts said. CIBanco in a statement said it will collaborate with U.S. and Mexican regulators and that clients' deposits were protected under local law. Intercam Banco did not immediately respond to requests for comment. Mexico has so far rebuffed the allegations from the U.S., saying the Treasury has not provided Mexico with proof to back up their declaring these institutions "as primary money laundering concerns." "There is no evidence," Mexican President Claudia Sheinbaum told reporters earlier on Thursday. "We will collaborate and coordinate (with U.S. authorities), but we will not bend to them." Mexican authorities, as well as the nation's banking association, have said that the blow to the firms would not have a contagion effect on the broader financial system, which remained resilient. Intercam's assets stand around $4 billion, while CIBanco holds some $7 billion and Vector nearly $11 billion, according to the U.S. Treasury, making them medium-size operations in the country. Vector's CEO, Edgardo Cantu, told Reuters on Thursday that the institution had not been subpoenaed by U.S. authorities and that it was "fully prepared to provide the information needed to clarify these allegations."
The Independent
2 days ago
- The Independent
US blocks money transfers by 3 Mexico-based financial institutions accused of aiding cartels
The U.S. Treasury Department slapped sanctions Wednesday on three Mexico-based financial institutions it said were used to launder millions of dollars for cartels, in a move officials say would block certain money transfers between the banks and American banks. The orders issued on the banks CIBanco and Intercam Banco, as well as brokerage Vector Casa de Bolsa, are part of an ongoing push by U.S. and Mexican authorities under pressure by U.S. President Donald Trump to crackdown on Mexican cartels that traffic fentanyl. The banks 'have collectively played a long-standing and vital role in laundering millions of dollars on behalf of Mexico-based cartels and facilitating payments for the procurement of precursor chemicals needed to produce fentanyl,' Deputy Treasury Secretary Michael Faulkender told reporters on Wednesday. Faulkender said the measures would 'effectively cut off' the bank branches from doing business with U.S. financial institutions. The orders would also sanction 31 people connected to the banks. The three financial institutions did not immediately respond to requests for comment. It was not immediately clear, however, how far-reaching the effects would actually be. When asked by reporters, Treasury officials did not confirm nor provide details about specific transfers between the Mexico-based banks and American banks, but said there were 'touch points' between the institutions. Officials also did not rule out the possibility of foreign branches of the banks outside of Mexico being able to continue to do business with U.S. banks. According to the Treasury orders, CIBanco helped facilitate money laundering for a number of cartels, including the Jalisco New Generation, Beltran Leyva and Gulf. Officials said the bank 'facilitated procurement' of chemicals used to make fentanyl from China, by processing over $2.1 million in payments for the materials. Vector was accused of facilitating money laundering for the Sinaloa and Gulf cartels, including $1 million in payments for fentanyl chemicals. The Treasury officials also said that Vector was used by the Sinaloa Cartel to send bribes to former Mexican Security Secretary Genaro García Luna, who was sentenced to more than 38 years in prison by a New York court in October for the charges. They estimated that transactions exceeded $40 million. Intercam faced similar charges, and was accused of passing through transfers of $1.5 million in payments for chemicals used to produce fentanyl from China. The orders were just the latest actions by the Trump administration, which has announced it was cracking down on Mexican cartels and fentanyl trafficking, despite movement of the drug along the border and overdoses within the U.S. already being on the decline. This year, the administration also declared many of those cartels Foreign Terrorist Organizations and has sanctioned a number of Mexican officials.
