U.S. Sanctions CJNG Cartel For $300M Timeshare Fraud Targeting Seniors

Yahoo

3 days ago

On Wednesday, the U.S. Treasury Department sanctioned four Mexican individuals and 13 companies linked to timeshare fraud schemes run by the Cartel de Jalisco Nueva Generacion (CJNG).
The action targets operations based in Puerto Vallarta that prey on elderly Americans.
CJNG, designated as a Foreign Terrorist Organization, has expanded beyond drug trafficking to generate revenue through elaborate timeshare scams that have cost U.S. victims nearly $300 million since 2019.
'We are coming for terrorist drug cartels like Cartel de Jalisco Nueva Generacion that are flooding our country with fentanyl,' said Treasury Secretary Scott Bessent. 'These cartels continue to create new ways to generate revenue to fuel their terrorist operations. At President Trump's direction, we will continue our effort to completely eradicate the cartels' ability to generate revenue, including their efforts to prey on elderly Americans through timeshare fraud.'
The scams follow a devastating pattern. Cartel-run call centers obtain timeshare owner information from resort insiders, then contact victims claiming to be brokers or attorneys.
They promise to sell timeshares or secure rental income but demand upfront 'fees' and 'taxes' that victims wire to Mexican bank accounts. The promised money supposedly owed to the owners never materializes, yet victims are pressed for additional payments.
Some schemes stretch for years. Re-victimization scams follow, with fraudsters impersonating law firms offering to recover losses or government officials threatening imprisonment without payment of 'fines.'
The FBI received nearly 900 timeshare fraud complaints in 2024 alone, reporting losses exceeding $50 million. Officials believe actual losses are far higher since most victims don't report due to embarrassment, among other reasons.
CJNG seized control of Puerto Vallarta's timeshare fraud operations around 2012. The cartel employs English-fluent telemarketers and accountants to execute complex schemes targeting older Americans' life savings.
Three senior CJNG members lead the fraud operations: Julio Cesar Montero Pinzon, Carlos Andres Rivera Varela, and Francisco Javier Gudino Haro. These men also orchestrate assassinations for the cartel's enforcement group using military-grade weapons.
Michael Ibarra Diaz Jr., a Puerto Vallarta businessman with 20 years in the timeshare industry, was also sanctioned. His network includes 13 companies spanning real estate, travel agencies, tour operators, and accounting firms.
Five companies explicitly acknowledge timeshare involvement: Akali Realtors, Centro Mediador De La Costa, Corporativo Integral De La Costa, Corporativo Costa Norte, and Sunmex Travel. Others mask their activities behind tourism and real estate fronts.
The Treasury's action freezes all U.S. property belonging to the designated individuals and companies. American citizens are prohibited from conducting transactions with them.
Financial institutions risk secondary sanctions for knowingly facilitating transactions with the sanctioned parties. The Treasury can prohibit foreign banks from maintaining U.S. correspondent accounts if they assist designated persons.
This marks the Treasury's fifth action against CJNG timeshare fraud, bringing total designations to over 70 individuals and entities. Previous sanctions occurred in March 2023, April 2023, November 2023, and July 2024.
CJNG ranks among the world's most powerful cartels. The group attacks Mexican military and police with military weapons, drops explosives from drones, and executes defiant recruits.
Beyond drug trafficking, CJNG generates revenue through fuel theft, extortion, and human smuggling. Treasury continues targeting these diverse income streams alongside the FBI, DEA, and Mexican financial intelligence partners.
Officials urge timeshare owners to exercise caution. Unsolicited purchase offers that seem too good to be true probably are fraudulent attempts to steal money.
Victims should file complaints at ic3.gov. Elderly victims can call the National Elder Fraud Hotline at 833-FRAUD-11 for assistance and resources.
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