Fentanyl and scams against American tourists place the Jalisco New Generation Cartel in Washington’s sights (2024)

The United States is closing in on the Jalisco New Generation Cartel (CJNG). In tandem with the pressure it has applied on the Sinaloa Cartel, a rival organization to the CJNG, Washington has launched multiple measures to rein in the cartel led by Nemesio Oseguera, alias “El Mencho.” For the past 18 months, U.S. authorities have been targeting what they consider to be the two most important players in the trafficking of fentanyl, a potent drug that pushed overdose deaths in the country to over 107,000 by 2022. The Treasury Department accuses the CJNG not only of being responsible for a “significant proportion” of the trafficking of the opioid, but of having set up a fraud and money laundering scheme that has netted some 6,000 American victims. Just seven months ago, a dozen Mexican companies were sanctioned in an attempt to wear down the organization through bank accounts used in real estate scams.

The latest target is scams involving timeshares, a type of lodging that typically consists of vacation rentals with multiple owners that are used for a limited amount of time per year. An FBI investigation indicates that the CJNG received information from resort workers about the U.S. owners of these properties in Mexico, and their personal information. With those details in hand, call center operators would call or mail those owners posing as lawyers, sales representatives, or real estate agents. The stories they orchestrated to create the fraud varied depending on the victim, but usually involved a promise to buy or rent. To complete the transaction, they would ask for the payment of taxes or fees — sometimes more than once — which would be returned upon completion of the sale or rental.

The scam did not end there. In some instances, they would later call the victims and pretend to be a law firm that could represent them, taking money from them again. There are also records that some were targeted on three occasions, in the last case by the same call center operators who posed as Mexican and U.S. government officials investigating the timeshare scams. The money ended up in Mexican bank accounts opened by shell companies, and from there in the pockets of drug traffickers or used to acquire luxury real estate or build timeshare resorts to be utilized in future fraudulent schemes. This took place mainly in tourist cities, such as Puerto Vallarta. U.S. authorities estimate that at least $300 million was defrauded through this illegal mechanism.

This week’s sanctions against three accountants and four Mexican companies come in the context of the U.S. authorities’ attempt to stifle the drug cartels. Just as they did with the Sinaloa Cartel, especially the Los Chapitos faction, led by the sons of imprisoned kingpin Joaquín “El Chapo” Guzmán, they have launched a wave of economic and financial measures against El Mencho’s cartel. “Combating fraud and TCO (transnational criminal organizations) activity are U.S. Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) National Priorities,” the Treasury Department notes in a joint statement with the FBI. It is one step in a series of measures.

Last November, the Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions against three Mexicans and 13 companies based in Mexico, also linked to the timeshare fraud. In June 2023, it sanctioned two high-ranking members of the CJNG for trafficking weapons and drugs, and for having participated in fuel theft, known as huachicoleo, another illegal business that brings in a lot of money for these criminal organizations. “The CJNG relies on a network of criminal activity that ultimately strengthens its ability to traffic fentanyl and other deadly drugs into the United States,” OFAC said at the time. And the sentences began to roll in as well. In April this year, 12 CJNG members were convicted in the United States of conspiring to traffic methamphetamine.

The cartels’ use of call centers in Mexico began to become clearer after the tragedy of the five young people who disappeared in Lagos de Moreno, Jalisco, in August 2023. The subsequent diffusion of a video showing one of the young men killing his own friends under criminal orders shocked the country. The press subsequently reported that two of the young men were looking for work and two days before the kidnappings had contacted a person who worked in a call center run by members of the CJNG. At the time the group of friends was lost track of, they had traveled to a location in the city to meet with the cartel operator. Almost a year later, the investigation into the case has made very little progress.

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