New Measures Aim to Disrupt Operations of Infamous Cartel Network

The Trump administration takes bold action against the Sinaloa Cartel with new Treasury Department sanctions targeting money launderers who sustain the cartel’s deadly fentanyl trafficking operations.

Quick Takes

Treasury Department sanctions hit six individuals and seven companies linked to the Sinaloa Cartel’s money laundering operations.
The Sinaloa Cartel has been designated as a foreign terrorist organization under the Trump administration.
Sanctions block all US assets of those designated and prohibit Americans from conducting business with them.
This action is part of a coordinated effort between US and Mexican authorities to dismantle the cartel’s financial networks.
The cartel is responsible for significant fentanyl trafficking into the United States, resulting in countless American deaths.

Treasury Targets Cartel’s Financial Structure

The US Treasury Department has levied sanctions against six individuals and seven companies involved in money laundering operations for the Sinaloa Cartel. The action freezes all US-based assets of the designated parties and makes it illegal for Americans to engage in transactions with them. These sanctions represent the latest effort in the Trump administration’s aggressive campaign against drug cartels bringing deadly substances across the southern border, particularly fentanyl, which has claimed hundreds of thousands of American lives in recent years.

The sanctioned network utilized front companies, shell corporations, and currency exchange businesses to launder drug profits. Many operated seemingly legitimate businesses while facilitating bulk cash pickups and transfers for the cartel. The Treasury’s Office of Foreign Assets Control (OFAC) has now sanctioned over 600 individuals and entities connected to the Sinaloa Cartel under various authorities, including the Kingpin Act and Executive Order 14059. These actions aim to deny the cartel access to the US financial system and impair their ability to profit from drug trafficking.

Terrorist Designation Expands Government Authority

The sanctions follow the Trump administration’s designation of the Sinaloa Cartel as a foreign terrorist organization, providing authorities with enhanced tools to combat the group’s criminal enterprises. This designation doesn’t significantly expand US military authority in Mexico but does create additional legal and financial pressure points. The Sinaloa Cartel has evolved beyond drug trafficking to diversify into other criminal enterprises, including avocado production and migrant smuggling, requiring a multifaceted approach from law enforcement.

Key individuals designated in the sanctions include Enrique Dann Esparragoza Rosas, Alan Viramontes Sesteaga, Salvador Diaz Rodriguez, Israel Daniel Paez Vargas, Alberto David Benguiat Jimenez, and Christian Noe Amador Valenzuela. The companies targeted include Tapgas Mexico S.A. de C.V. and several other front companies used for laundering drug profits. Anyone conducting business with these designated parties could themselves become exposed to sanctions or enforcement actions, according to the Treasury Department’s warning.

Coordinated Enforcement Effort

The sanctions are part of a coordinated investigation involving multiple US agencies, including the Drug Enforcement Administration, Homeland Security Investigations, and the Financial Crimes Enforcement Network (FinCEN). Mexican authorities have also cooperated in the effort. FinCEN issued an alert to financial institutions about bulk cash smuggling tactics used by Mexico-based criminal organizations, requesting vigilance in identifying and reporting suspicious activities that could be tied to cartel operations.

The Trump administration has taken wide-ranging actions against cartels, including extraditing MS-13 leaders and invoking the Alien Enemies Act to expedite the removal of suspected cartel members. These actions have faced legal challenges, with the administration seeking Supreme Court intervention to uphold their authority. Treasury officials emphasized that sanctions aim to bring about positive behavioral change, not just punishment, by cutting off cartels from the legitimate financial system that enables their illegal operations.