Measures for the Prevention of Money Laundering and Terrorism Financing:

By: Ángel Escorcia, Socio Líder de la Práctica Legal Corporativa, especialista en Fusiones y Adquisiciones (M&A), y Eduardo García, Director de Servicios Legales de KPMG México

On March 31, 2025, the Office of Foreign Assets Control (OFAC) of the U.S. Department of the Treasury announced sanctions against six individuals and seven entities involved in a sophisticated money laundering network through complex financial and cross-border operations between the United States and Mexico.

These measures were part of a coordinated effort between various U.S. agencies and Mexican authorities to disrupt the financial sources of criminal organizations and restrict their access to the U.S. financial system, resulting in the following findings and consequences:

• Financial Vulnerabilities: Sophisticated money laundering techniques were applied, such as currency arbitrage and the use of shell companies, facilitating the transfer of illicit funds from the U.S. to Mexico.
• Imposed Sanctions: Six individuals and seven entities were penalized under Executive Orders 14059 and 13224, which block their assets in the U.S., and all U.S. persons are prohibited from engaging in transactions with them.
• Cross-Border Coordination: A joint investigation was conducted among U.S. agencies, such as the Drug Enforcement Administration (DEA), Federal Bureau of Investigation (FBI), Internal Revenue Service-Criminal Investigation (IRS-CI), Homeland Security Investigations (HSI), among others, and Mexican authorities, including the Financial Intelligence Unit (UIF).
• Compliance Risks and Sanctions: Financial institutions and companies involved in cross-border transactions must heed alerts from the Financial Crimes Enforcement Network (FinCEN) to identify warning signs related to cash smuggling and repatriation schemes, aiming to avoid violations that could lead to secondary sanctions.
• Broad Implications of Sanctions: Entities with significant ties to designated individuals or companies are also subject to asset freezes, increasing the risk for businesses that may be inadvertently connected to these networks.

This recent enforcement action serves as a clear reminder for organizations in Mexico engaged in international commercial and financial transactions to protect their operations and supply chains by implementing measures that strengthen their compliance management systems, such as the following:

• Enhancing Due Diligence: Verify partners, suppliers, and financial intermediaries to ensure they have no direct or indirect links to entities associated with criminal organizations.
• Strengthening Compliance Programs: Implement robust internal controls and compliance frameworks that monitor transactions and detect suspicious activities in compliance with U.S. and Mexican regulations.
• Ongoing Legal Advice: Consult with legal specialists to periodically review and update risk management strategies and ensure that contracts with third parties include a clause allowing for compliance reviews.
• Monitoring Regulatory Updates: Stay informed about new notices from both U.S. and Mexican authorities to timely adjust business practices and protect supply chains from potential exposure to activities related to potential criminal activities.

Note: The ideas and opinions expressed in this article are those of the authors and do not necessarily represent the ideas and opinions of KPMG in Mexico.

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