The United States Department of the Treasury’s Office of Foreign Assets Control (OFAC) on 30 June designated two Mexican nationals and nine companies for their alleged role in a transnational fuel-smuggling scheme that, according to the Treasury, generated tens of millions of dollars annually for the Jalisco New Generation Cartel (CJNG). Simultaneously, the Financial Crimes Enforcement Network (FinCEN) issued an alert to financial institutions detailing red flags of such “huachicol fiscal” operations, and Mexico’s Financial Intelligence Unit (UIF) froze the accounts of the designated entities plus nine additional persons, adding them to its national blocked list.

Viewed from Washington, the action underscores a strategic assessment: Treasury Secretary Scott Bessent stated that Mexican cartels are expanding “beyond traditional drug trafficking” to diversify revenue, with fuel theft and contraband now the largest non-drug income source. The US Embassy in Mexico, through Ambassador Ronald Johnson, framed the sanctions as part of President Trump’s commitment to combat fentanyl trafficking and cartel violence, and highlighted bilateral cooperation with President Claudia Sheinbaum’s administration. Mexican authorities, for their part, said the UIF’s parallel blocking was based on its own fiscal, financial and corporate analysis, and that the joint measures “strengthen international cooperation mechanisms to prevent misuse of the financial system.”

The designations freeze all US-based assets of the individuals and firms, prohibit American persons from transacting with them, and expose foreign financial institutions to secondary sanctions if they facilitate significant transactions. The FinCEN alert, referencing over 160 suspicious activity reports filed in the past year documenting more than $7 billion in irregular flows, instructs banks to scrutinise transactions involving fuel imports misclassified as waste oil or lubricants, shell companies in transport and logistics, and payments structured through digital assets or cash deposits. The sanctioned network, according to OFAC, used false customs documents and bribes to evade Mexico’s Special Tax on Production and Services (IEPS), then sold the fuel through licensed service stations, injecting illicit capital into the formal economy.

The Treasury’s announcement also noted a broader pattern: cartels allegedly channel profits from fuel smuggling into cash payments to Mexican political campaigns and media outlets to secure protection and access to state contracts, though it did not link the designated individuals to specific politicians. The CJNG, designated a foreign terrorist organisation by Washington in 2025, has seen its leadership disrupted this year with the killing of Nemesio Oseguera Cervantes (“El Mencho”) in February and the arrest of a presumed successor in April. The UIF’s addition of 20 persons to its blocked list signals continued Mexican enforcement, and the dossier remains active as both governments monitor financial flows for further action.