Mexican drug cartel suspects charged with money launderers in Southern California District | Ballard Spahr srl

[co-author: Michael Robotti]

Last week, the Southern District of California partially unsealed a replacement indictment (the “Indictment”) revealing allegations against 29 alleged members of an international money laundering organization (“MLO”) linked to some of Mexico’s largest and most powerful drug trafficking organizations , and who have allegedly laundered more than $ 32 million in drug products from the United States to Mexico. The indictment sets out a charge of conspiracy to commit money laundering and calls for the forfeiture of $ 11,386,793.

The indictment

According to the Ministry of Justice Press release, the accused MLO allegedly laundered drug money from the United States to Mexico for the Sinaloa Cartel and the Jalisco new generation cartel (known as CJNG, after its name’s acronym in Spanish Jalisco Nueva Generación Cartel). Both are known for their size, power, and brutality.

Specifically, the MLO is said to have laundered more than $ 32 million in drug products through a complex web of contracts with Mexican drug trafficking organizations. MLO has secured contracts with drug trafficking organizations in Mexico to collect drug proceeds in cities across the United States including Baltimore, Detroit, Los Angeles, Philadelphia, Boston, Denver, Chicago, New York and many others. The MLO relied on bulk money transfers:

Once the MLO received a contract, it communicated with the courier and bank account holders using cell phones and code phrases to coordinate bulk cash deposits at a shell commercial bank in funnel. . . . The defendants are said to have served as either couriers and / or funnel bank account holders. Couriers traveled from San Diego to cities across the country to receive the cash in bulk after using photographs and codes to verify meeting details. Bulk money was generally concealed in trash bags, duffel bags or shoe boxes. After the illicit cash proceeds were deposited into the funnel’s fictitious bank accounts, the money was transferred to personal bank accounts in Mexico where the money was then distributed to drug trafficking organizations.

The charge is part of an investigation by the HSI Costa Pacifico Money Laundering Task Force, in coordination with the DEA and IRS-Criminal Investigation. Acting US Attorney Randy Grossman drew an analogy between this withdrawal and cutting off the legs of the cartels, saying: “The key to dismantling drug trafficking organizations is to disrupt the flow of illicit funds and attack them. elements of money laundering organizations. The operation that led to the indictment is a stark reminder that the first way to end up on the wrong side of an indictment is to leave a trail of money.

The new generation cartels of Sinaloa and Jalisco: who are they?

The Sinaloa cartel was once ruled by Joaquin “El Chapo” Guzman, who currently serves as a perpetuity in a US federal prison for multiple crimes including murder, kidnapping and conspiracy. The long-standing cartel is based in the town of Culiacan, Sinaloa, but has organized crime activity across the world. The Sinaloa Cartel is familiar with US law enforcement agencies; one of his other money launderers was sentenced last month to 10 years in prison for laundering approximately $ 15 million from the sale of drugs smuggled into the United States. Other cartel members were also sentenced conspiracy to violate several laws, including the Corrupt Organization Influenced by Racketeering (RICO), Drug Possession and Importation, Money Laundering and Firearms Ownership Act, for their purposes. role in the Cartel’s drug distribution operations.

The CJNG, known as the “most aggressive” cartel in Mexico, and certainly one of the bloodiest, is also no stranger to American law enforcement. In August 2020, 28 people connected to CJNG were accused with, conspiracy to launder money and other financial, drug and gun related crimes. Earlier, in February 2020, four more people were indicted on federal money laundering charges for their part in cartel money laundering from 2018 to January 2020.

The more recently formed CJNG is reputed to be the main rival of the Sinaloa cartel, which raises the question of whether the two organizations knew their money was being managed by the same MLO. The two cartels have fought well-known battles along the drug trafficking routes, so the recent indictment could spark even more conflict between the organizations.

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