From Crude To Crime: Family's $47M Oil Scheme Allegedly Bankrolled Mexican Cartel
James Lael Jensen, 68, and Maxwell Sterling Jensen, 25, allegedly 'conspired to provide material support to the Cartel de Jalisco Nueva Generación' (CJNG),' according to a press release from the Department of Justice. They allegedly operated Arroyo Terminals in Rio Hondo, near the Texas-Mexico border.
'This case underscores the more aggressive and innovative approach the Southern District of Texas is taking towards combatting the scourge of drug cartels,' said U.S. Attorney Nicholas Ganjei in the press release. 'This strategy focuses not just on the traffickers and trigger-pullers directly employed by the cartels, but also targeting their confederates and enablers.'
James Jensen is reportedly from Sandy, Utah, while Maxwell Jensen is from Draper, Utah. A superseding indictment was returned on May 22, charging them with conspiracy to 'materially support' the cartel – a foreign terrorist organization, conspiracy to commit money laundering, and 'related smuggling charges.'
The father and son are also charged with 'conspiring to conduct financial transactions to conceal and disguise the nature and source of the proceeds of illegally smuggled goods, crude oil,' according to the press release. They allegedly 'aided and abetted' the 'fraudulent entry' of close to 2,881 shipments of oil.
The indictment accused James and Kelly Jensen of funneling more than $47 million to Mexican businesses connected to the cartel, according to KRGV. An arrest warrant cited by the outlet accused them of making payments for crude oil 'to businesses in Mexico that operate only through the permission of Mexican criminal organization,' and it claimed, 'James Jensen was aware that the payments he made were going to these Mexican criminal organizations.'
'Cases like this highlight the often-dangerous relationships between alleged unscrupulous U.S. businesses and terrorist organizations,' stated Craig Larrabee, special agent in charge of ICE-Homeland Security Investigations San Antonio, in the release. 'Through strong collaborations and relentless investigative work, we and our partners exposed a possible large-scale operation that allegedly attempted to move millions in illicit crude oil and launder the proceeds.'
Police arrested James Jensen and his wife Kelly on April 27, according to KRGV. Their sons, Maxwell and Zachary Jensen, were also arrested. All four suspects pleaded not guilty.
Officials seized four 'tank barges' with crude oil, three commercial tanker trucks, an Arroyo Terminal pickup, and a 'personal vehicle' at the time of the arrests, according to the release. The Arroyo Terminal property in Rio Hondo included crude oil storage tanks and 'additional real properties' for which the government is seeking forfeiture. Upon conviction, the government will also seek a $300 million monetary judgment.
James and Maxwell Jensen could face 20 years in prison for the charges of conspiracy to provide material support and to commit money laundering. They could face additional sentences of five and 10 years if convicted of aiding and abetting smuggling and doing so 'by means of false statements.' James Jensen faces another charge of 'money laundering spending,' which could bring an additional 10 years in prison. The money laundering charge could bring fines of up to $500,000 or twice the value of the property, and the other charges could bring up to $250,000 in fines.
The investigation was a 'joint effort' between law enforcement, including the DEI, FBI, and ICE-HSI. The agencies found 'substantial assistance' from Customs and Border Protection, U.S. Marshals, IRS Criminal Investigations, and the Texas Department of Public Safety.
'What began as a Drug Enforcement Administration (DEA) drug trafficking investigation evolved into a multifaceted case involving an alleged complex criminal operation generating millions of dollars from crude oil – the largest funding source for Mexican drug cartels,' stated William Kimbell, DEA-Houston acting special agent in charge, in the press release.
This investigation was part of the broader 'Operation Take Back America,' a national mission using the 'full resources of the Department of Justice to repel the invasion of illegal immigration, achieve the total elimination of cartels and transnational criminal organizations and protect our communities from the perpetrators of violent crime.'
The Cartel de Jalisco Nueva Generación, or CJNG, is 'responsible for a significant proportion of fentanyl and other deadly drugs trafficked into the United States,' according to the Department of the Treasury. While the Sinaloa Cartel has historically been dominant in Dallas and Fort Worth, the CJNG has also been in the area, according to the 2015 National Drug Threat Assessment. Years later, in 2024, Texas was still among the states with the most Mexican cartel presence.
'Mexico-based drug trafficking cartels such as CJNG have turned to fuel theft and crude oil smuggling in recent years, resulting in billions of dollars in lost revenue for the Mexican government,' according to the Treasury's website. 'These schemes have grown into powerful revenue generators for CJNG, enabling their campaigns of narcotics trafficking in the United States and violence against Mexican government forces along the U.S. southwest border.'
Aaron Tapp, FBI special agent in charge of the San Antonio Field Office, said in the release that it is a 'top priority' for the bureau to 'eliminate foreign terrorist organizations' by cutting off their funding and seizing their assets.
'Together with our law enforcement partners, we will use every resource and capability at our disposal to ensure violent cartels and anyone who corruptly facilitates their operations are held accountable to the American people and unable to establish a foothold in our communities,' Tapp said in the release.
Assistant U.S. Attorneys James Sturgis and Laura Garcia are prosecuting this case, and Assistant U.S. Attorneys Mary Ellen Smyth and Tyler Foster are 'handling seizure and forfeiture.'
'Whether you are handing the cartel a gun, providing a car or safehouse for smugglers, or putting money in the cartel's pocket,' Ganjei said in the release, 'you will be held to account.'
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