Latest news with #FentanylSanctionsAct
Yahoo
6 hours ago
- Business
- Yahoo
US sanctions Mexican banks, alleging connections to cartel money laundering
The United States has imposed sanctions on three Mexican banks, alleging they had been used to launder money for drug cartels. On Wednesday, the US Department of the Treasury tied the banks – CIBanco, Intercam Banco and Vector Casa de Bolsa – to the cross-border trafficking of the deadly synthetic drug fentanyl. It accused them of playing 'a longstanding 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'. The sanctions are part of a wider pressure campaign by the administration of US President Donald Trump against Latin American gangs, criminal networks and drug traffickers. That campaign has included designating several groups as 'foreign terrorist organisations' and using tariffs to pressure Mexico's government to increase enforcement of irregular traffic across the border. In a statement, the Treasury Department said the banks were the first to be targeted under new pieces of legislation – the Fentanyl Sanctions Act and the FEND Off Fentanyl Act – passed to expand its ability to target money laundering related to opioid trafficking. The sanctions would block transfers between the targeted Mexican banks and US banks, although it was not immediately clear how far-reaching the limits would a statement, Secretary of the Treasury Scott Bessent accused the banks of 'enabling the poisoning of countless Americans by moving money on behalf of cartels, making them vital cogs in the fentanyl supply chain'. But Mexico's Secretariat of Finance and Public Credit responded to the sanctions by saying it had yet to receive conclusive evidence justifying them. 'We want to be clear: If we have conclusive information proving illicit activities by these three financial institutions, we will act to the fullest extent of the law,' the Finance Ministry said. 'However, to date, we have no information in this regard.'CIBanco did not immediately respond to the allegations. The US Treasury Department accused it of being connected to money laundering by the Beltran-Leyva Cartel, the Jalisco New Generation Cartel (CJNG) and the Gulf Cartel. Intercam, which is also accused of having connections to the CJNG cartel, also did not respond. Meanwhile, the brokerage firm Vector, which was linked to money laundering by the Sinaloa Cartel and Gulf Cartel, said the US claims tying its operations to drug traffickers were false. 'Vector categorically rejects any accusation that compromises its institutional integrity,' the company said in a statement, adding that it would cooperate to clarify the situation.
Straits Times
9 hours ago
- Business
- Straits Times
US targets three Mexican financial institutions under fentanyl sanctions
A view shows a bronze seal beside a door at the U.S. Treasury building in Washington, U.S., January 20, 2023. REUTERS/Kevin Lamarque/File Photo The U.S. Treasury on Wednesday prohibited certain transactions with Mexico-based financial institutions CIBanco, Intercam Banco and Vector Casa de Bolsa as part of its new fentanyl sanctions. The actions by the Treasury-run Financial Crimes Enforcement Network (FinCEN) to declare the three institutions "as primary money laundering concerns" mark the first actions under the Fentanyl Sanctions Act and the FEND Off Fentanyl Act, the Treasury said in a statement. Experts said the move, although targeting relatively small institutions, could have significant impact on Mexico's financial system given the interconnectedness between banks and the close business relationship with the United States. Although sanctions against individuals and companies for links to Mexican organized crime groups are fairly frequent, measures against financial institutions are far less common. The sanctions also add another potential obstacle to easing U.S.-Mexico trade tensions over U.S. President Donald Trump's 25% punitive tariffs on many imports from Mexico, which are aimed at spurring action to halt the flow of fentanyl into the U.S. Mexico's Finance Ministry said in a statement that it was notified of the FinCEN investigation and asked the Treasury for evidence of illicit activity links to CIBanco, Intercam and Vector, but received no "conclusive information." The FinCEN sanctions do not block property or cut off all global dollar-based activities of the Mexican firms as other Treasury sanctions would, but they do prohibit U.S. transactions with their locations in Mexico, a U.S. Treasury official told reporters. The action will have a similar effect of cutting the institutions out of the U.S. financial system, the official added. The Treasury said that Commercial banks CIBanco and Intercam have assets of over $7 billion and $4 billion, respectively, making them relatively small by global banking standards. But the action against Vector, a brokerage firm that manages nearly $11 billion in assets and is one of the top 10 securities brokers in Mexico, "underscores the significance of our actions," Deputy U.S. Treasury Secretary Michael Faulkender told reporters. "This is a bold move. Being cut off from the US financial system is a death blow. It's enormously impactful," said Vanda Felbab-Brown, senior fellow at the Brookings Institution and a specialist on organized crime. "These are hardly the biggest banks in Mexico, but they are not small entities. These are medium-level banks," she said, adding that while significant it was unlikely to "make any kind of dent in the financial flows of Mexican criminal groups." LAUNDERING MILLIONS The Treasury said all three institutions "have collectively played a longstanding 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." "Vector categorically rejects any accusation that compromises its institutional integrity," Vector said in a statement. It added that it reiterated its full willingness to collaborate with Mexican and U.S. authorities to clarify the situation. Intercam said: "We categorically deny any connection between this institution and any illicit practice." "CIBanco has no involvement in illegal activities," the bank said in a statement, adding that it complies with all regulations set by the relevant authorities. Luis Manuel Perez de Acha, a tax lawyer and money laundering expert in Mexico City, said the accusations were a 'bombshell.' 'The entire financial system passes through the United States, so they are practically left without operations," he said. REUTERS Join ST's Telegram channel and get the latest breaking news delivered to you.
New York Post
10 hours ago
- Business
- New York Post
Trump admin sanctions three Mexican financial firms over suspected links to drug cartels
The Trump administration on Wednesday restricted US banks from making transactions with three Mexican financial firms over concerns that they are laundering money for drug cartels. The sanctions – the first implemented under the Fentanyl Sanctions Act and the FEND Off Fentanyl Act – targeted Mexican banks CIBanco and Intercam Banco and the brokerage firm Vector Casa de Bolsa, which have a combined $22 billion in assets, according to the Treasury Department. 'Cartels have exploited Mexico-based financial institutions to move money, enabling the vicious fentanyl supply chain that has poisoned countless Americans,' Treasury Secretary Scott Bessent wrote on X. 'Through the first use of a new powerful authority granted by Congress, Treasury will effectively require US financial institutions to sever ties with 3 Mexico-based financial institutions for laundering money on behalf of cartels,' Bessent added. 'Both the United States and Mexico are committed to financial systems with strong anti-money laundering/countering the financing of terrorism controls and these actions affirm Treasury's commitment to using all tools at our disposal to counter the threat posed by terrorist organizations.' 4 Trump designated several Mexican drug cartels as terrorist groups earlier this year. REUTERS The sanctions were implemented after the Treasury Department's Financial Crimes Enforcement Network (FinCEN) determined that CIBanco, Intercam and Vector were 'moving money on behalf of cartels' and had become 'vital cogs in the fentanyl supply chain,' according to Bessent. FinCen's investigation found a 'long-standing pattern of associations, transactions, and provision of financial services' between CIBanco and Intercam and several Mexican drug trafficking groups, including Jalisco New Generation Cartel (CJNG) and Gulf Cartel. Between 2021 and 2024, CIBanco and Intercam processed over $3.6 million in purchases of fentanyl precursor chemicals from China, shipped to Mexico, for 'illicit purposes,' according to FinCen. The financial crimes watchdog further alleged that Intercam executives 'met directly with suspected CJNG members' in 2022 'to discuss money laundering schemes, including transferring funds from China,' and that a CIBanco employee 'knowingly facilitated the creation of an account to purportedly launder $10 million on behalf of a Gulf Cartel member' in 2023. 4 The sanctions were imposed under new authorities granted to Trump administration to combat illegal fentanyl. Jeffrey Greenberg/Universal Images Group via Getty Images 4 Treasury's financial crimes watchdog, FinCen, conducted the investigation against the Mexican banks. Vector's alleged dealings with drug cartels date back to 2013, according to FinCen, which found a Sinaola Cartel 'money mule' laundered at least $2 million from the US to Mexico through the brokerage firm. In 2021 alone, Vector 'remitted over USD 17 million in suspicious wire transfers to multiple China-based companies … on behalf of a company that was reportedly tied to an international drug trafficking organization,' according to FinCen. Since at least 2019, Vector processed fund transfers to 'over 20 China-based companies' that shipped fentanyl precursor chemicals to Mexico. 'Based on non-public information, as well as the volume and dollar amount of funds transfers that Vector processed over several years with these companies, FinCEN assesses that such transactions likely facilitated illicit opioid trafficking by Mexico-based [drug trafficking organizations],' the Treasury Department bureau noted. 4 The sanctions will prohibit US banks from making certain transactions with the three Mexican firms. FinCen also discovered that Vector processed 'bribes' paid by the Sinaloa Cartel to a former top Mexican law enforcement official who was convicted of corruption charges in 2023. The Treasury Department said it aims to deny anyone associated with Mexican drug cartels deemed Foreign Terrorist Organizations (FTOs) and/or Specially Designated Global Terrorists by the Trump administration 'access to the US financial system.'
India Today
12 hours ago
- Business
- India Today
US sanctions three Mexico-based financial institutions linked to fentanyl trade
The US Treasury Department on Wednesday took a significant step in its fight against fentanyl trafficking, prohibiting certain financial transactions with three Mexico-based institutions, CIBanco, Intercam Banco, and Vector Casa de Bolsa. The move, led by the Treasury's Financial Crimes Enforcement Network (FinCEN), marks the first use of new sanctions under the Fentanyl Sanctions Act and the FEND Off Fentanyl designated the three financial firms as 'primary money laundering concerns,' a classification that restricts US entities from conducting transactions with their Mexican branches. While the sanctions don't involve freezing assets or fully severing global access to US dollars—as is typical with more severe measures—they effectively isolate the institutions from the US financial these are not the largest players in Mexico's financial sector, the Treasury's action could have far-reaching implications due to the deeply interwoven nature of Mexican and US banking systems. Sanctions against individual actors tied to organized crime are relatively common, but such measures against financial institutions are rare. The inclusion of these three firms, particularly Vector, a top-10 Mexican brokerage managing nearly USD 11 billion in assets, signals a new level of enforcement. Deputy Treasury Secretary Michael Faulkender emphasized the gravity of the action, calling it a clear message about US intent to crack down on financial channels used by drug is a bold move. Being cut off from the US financial system is a death blow. It's enormously impactful,' said Vanda Felbab-Brown, a Brookings Institution expert on organized crime. While she noted the institutions are not among Mexico's largest, she characterized them as mid-sized players and stressed that the consequences would be substantial, even if the broader impact on cartel finances remains to the Treasury, the three institutions have for years facilitated the laundering of millions of dollars for Mexican cartels and enabled payments for chemicals used to manufacture institutions pushed back on the accusations. Vector 'categorically rejected' the claims, affirming its commitment to cooperate with authorities. Intercam also denied any involvement in illicit activity. CIBanco has not yet issued a Finance Ministry stated it had requested evidence from the US Treasury to support the allegations but received no conclusive expert Luis Manuel Perez de Acha described the move as a 'bombshell,' noting that being excluded from US financial networks could leave these firms effectively sanctions may further strain trade relations between the US and Mexico, already tense due to ongoing US efforts, including the use of steep tariffs, to compel Mexico to curb fentanyl flows across the border.- EndsWith inputs from ReutersTune InMust Watch
India Today
12 hours ago
- Business
- India Today
US blocks transactions with Mexican financial institutions in fentanyl crackdown
The US Treasury on Wednesday prohibited certain transactions with Mexico-based financial institutions CIBanco, Intercam Banco and Vector Casa de Bolsa as part of its new fentanyl sanctions actions by the Treasury-run Financial Crimes Enforcement Network (FinCEN) to declare the three institutions "as primary money laundering concerns" mark the first actions under the Fentanyl Sanctions Act and the FEND Off Fentanyl Act, the Treasury said in a Finance Ministry said in a statement that it was notified of the FinCEN investigation and asked the Treasury for evidence of illicit activity links to CIBanco, Intercam and Vector, but received no information. "The FinCEN sanctions do not block property or cut off all global dollar-based activities of Mexican firms as other Treasury sanctions would, but they do prohibit U.S. transactions with their locations in Mexico, a U.S. Treasury official told reporters. "The action will have a similar effect of cutting institutions out of the U.S. financial system," the official Treasury said that commercial banks CIBanco and Intercam have assets of over $7 billion and $4 billion, respectively, making them relatively small by global banking the action against Vector, a brokerage firm that manages nearly $11 billion in assets and is one of the top 10 securities brokers in Mexico, "underscores the significance of our actions," Deputy U.S. Treasury Secretary Michael Faulkender told Treasury said all three institutions "have collectively played a longstanding 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."The Treasury said that a CIBanco employee in 2023 knowingly facilitated the creation of an account to purportedly launder $10 million on behalf of a Gulf Cartel member and the bank processed over $2.1 million in payments on behalf of Mexico-based companies to China-based companies that shipped fentanyl precursor chemicals to Mexico for illicit said Intercam executives in late 2022 met directly with suspected CJNG cartel members to discuss money laundering schemes, including transferring funds from the Vector sanctions, the Treasury said that from 2013 through 2021, a Sinaloa Cartel "money mule" employed various methods to launder $2 million from the United States to Mexico through Vector, while the firm also processed over $1 million in transactions between Mexican companies and Chinese companies known to have shipped precursor chemicals to Mexico."Vector categorically rejects any accusation that compromises its institutional integrity," Vector said in a statement. It added that it reiterated its full willingness to collaborate with Mexican and U.S. authorities to clarify the and Intercam did not immediately respond to a request for Finance Ministry said that if it has conclusive information proving illicit activities involving the three institutions, it will act to the fullest extent of the sanctions add another potential obstacle to easing U.S.-Mexico trade tensions over U.S. President Donald Trump's 25% punitive tariffs on many imports from Mexico, which are aimed at spurring action to halt the flow of fentanyl into the U.S."I want to affirm that under President Trump, the Treasury Department has taken and will continue to take historic action to ensure that cartels and drug traffickers cannot abuse the U.S. dollar to launder drug money and profit off the poisoning of Americans," Faulkender said.- EndsMust Watch
