Treasury Sanctions CJNG Cell Leaders Linked to Fentanyl

WASHINGTON — Today, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned two Mexican members of Cartel de Jalisco Nueva Generacion (CJNG) and two Mexican companies. CJNG, a Mexico-based criminal organization, is one of the largest producers and traffickers of illicit fentanyl to the United States. OFAC coordinated this action with the Government of Mexico, including its financial intelligence unit, La Unidad de Inteligencia Financiera (UIF), as well as U.S. Government partners, including the U.S. Attorney’s Office for the Central District of California, the Drug Enforcement Administration, Homeland Security Investigations, and Internal Revenue Service – Criminal Investigations.       

“Over the past month, the Biden-Harris administration has imposed five new rounds of sanctions on transnational criminal organizations, including traffickers and revenue-generating schemes fueling the flood of fentanyl and other drugs into the United States by CJNG and other cartels,” said Under Secretary of the Treasury for Terrorism and Financial Intelligence Brian E. Nelson. “Building on our strong partnerships across the U.S. government and with our counterparts in Mexico, we will continue to act against the financial flows of CJNG and other criminal organizations that harm Americans through the illicit drug trade.”

Today’s designations also further efforts by Treasury’s Counter-Fentanyl Strike Force, which leverages Treasury’s unique expertise and capabilities to disrupt the illicit financial networks relied upon by the cartels.

CJNG CELL LEADERS

Juan Carlos Banuelos Ramirez (Banuelos) is a CJNG cell leader who has worked to send methamphetamine and fentanyl to the United States. In addition, Banuelos launders money, procures precursor chemicals, and oversees production labs within Mexico. As part of his efforts, Banuelos has procured precursor chemicals from Mexican national associates located outside of Mexico for import into Mexico. Banuelos has specifically worked to send counterfeit oxycodone pills containing fentanyl from his lab in Mexico, and manages methamphetamine production in Jalisco, Mexico labs. For export to the United States and other destinations, Banuelos often has smuggled the drugs within machinery. Furthermore, Banuelos has purchased automatic weapons for CJNG and has sought high-grade drones for the organization. Banuelos was previously indicted by a federal grand jury sitting in the Central District of California.

In addition, OFAC today designated Gerardo Rivera Ibarra (Rivera), a leader of a CJNG cell capable of supplying fentanyl, methamphetamine, and cocaine to the United States. Rivera operates in Jalisco, Mexico and has ties to Audias Flores Silva, a high-ranking CJNG member designated pursuant to the Foreign Narcotics Designation Kingpin Act (Kingpin Act).

Banuelos was sanctioned today pursuant to Executive Order (E.O.) 14059 for having engaged in, or having attempted to engage in, activities or transactions that have materially contributed to, or pose a significant risk of materially contributing to, the international proliferation of illicit drugs or their means of production. Rivera was sanctioned today pursuant to E.O. 14059 for having acted or purported to act for or on behalf of, directly or indirectly, CJNG, a person sanctioned pursuant to E.O. 14059.

Also today, OFAC sanctioned two Mexican companies pursuant to E.O. 14059. OFAC sanctioned Fornely Lab S.A. de C.V. — engaged in wholesale trade — for being owned, controlled, or directed by, or having acted or purported to act for or on behalf of, directly or indirectly, Rivera, a person sanctioned pursuant to E.O. 14059. Additionally, OFAC sanctioned Inmobiliaria Universal Deja Vu S.A. de C.V. — engaged in real estate activities — for being owned, controlled, or directed by, or having acted or purported to act for or on behalf of, directly or indirectly, Banuelos, a person sanctioned pursuant to E.O. 14059.

OTHER OFAC ACTIONS AGAINST CJNG

On April 8, 2015, OFAC sanctioned CJNG pursuant to the Kingpin Act for playing a significant role in international narcotics trafficking. On December 15, 2021, OFAC also designated CJNG pursuant to E.O. 14059. In other actions, OFAC has sanctioned numerous CJNG-linked individuals and companies pursuant to both the Kingpin Act and E.O. 14059 that were engaged in various commercial activities and multiple individuals who played critical roles in CJNG’s drug trafficking, money laundering, and corruption.

Last week, as part of a continued campaign to target the enablers of timeshare fraud affecting U.S. citizens, OFAC sanctioned seven CJNG-affiliated targets associated with timeshare fraud. Concurrently, Treasury’s Financial Crimes Enforcement Network (FinCEN) issued a joint Notice with OFAC and the Federal Bureau of Investigation to financial institutions that provides methodologies, financial typologies, and red flag indicators of timeshare fraud schemes in Mexico associated with CJNG and other Mexico-based transnational criminal organizations.

SANCTIONS IMPLICATIONS

As a result of today’s action, all property and interests in property of the designated persons described above that are in the United States or in the possession or control of U.S. persons are blocked and must be reported to OFAC. In addition, any entities that are owned, directly or indirectly, individually or in the aggregate, 50 percent or more by one or more blocked persons are also blocked. Unless authorized by a general or specific license issued by OFAC, or exempt, OFAC’s regulations generally prohibit all transactions by U.S. persons or within (or transiting) the United States that involve any property or interests in property of designated or otherwise blocked persons. U.S. persons may face civil or criminal penalties for violations of E.O. 14059 and the Kingpin Act. Non-U.S. persons are also prohibited from causing or conspiring to cause U.S. persons to wittingly or unwittingly violate U.S. sanctions, as well as engaging in conduct that evades U.S. sanctions. OFAC’s Economic Sanctions Enforcement Guidelines provide more information regarding OFAC’s enforcement of U.S. sanctions, including the factors that OFAC generally considers when determining an appropriate response to an apparent violation.

Today’s action is part of a whole-of-government effort to counter the global threat posed by the trafficking of illicit drugs into the United States that is causing the deaths of tens of thousands of Americans annually, as well as countless more non-fatal overdoses. This action also builds on a recent FinCEN supplemental advisory to U.S. financial institutions on new trends, typologies, and red flag indicators associated with the illicit fentanyl supply chain and the illicit procurement of fentanyl precursor chemicals and manufacturing equipment by Mexico-based transnational criminal organizations. OFAC, in coordination with its U.S. government partners and foreign counterparts, and in support of President Biden’s Unity Agenda, will continue to hold accountable those individuals and businesses involved in the manufacturing and sale of illicit drugs.

The power and integrity of OFAC sanctions derive not only from OFAC’s ability to designate and add persons to the SDN List, but also from its willingness to remove persons from the SDN List consistent with the law. The ultimate goal of sanctions is not to punish, but to bring about a positive change in behavior. For information concerning the process for seeking removal from an OFAC list, including the SDN List, please refer to OFAC’s Frequently Asked Question 897 here. For detailed information on the process to submit a request for removal from an OFAC sanctions list, please click here.

For more information on the individuals and entities designated today, click here.

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