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US Treasury Targets CJNG Fuel Smuggling Network With Sanctions

The U.S. Treasury Department sanctioned two Mexican nationals and nine companies Tuesday for allegedly facilitating a multimillion-dollar fuel-smuggling operation run by the Jalisco New Generation Cartel. The action by the Office of Foreign Assets Control and Financial Crimes Enforcement Network underscores how Mexican cartels are diversifying revenue streams beyond narcotics. Treasury officials identified three primary smuggling activities: crude oil and fuel theft from state-owned Petróleos Mexicanos, cross-border fuel smuggling into Mexico while evading import taxes through fraudulent customs declarations, and tax evasion schemes. Federal assessments estimate fuel theft cost Mexico $9 billion in lost tax revenue during 2024. As much as one-third of fuel sold in Mexico may be illegally sourced or adulterated. Treasury warned banks and businesses to monitor financial red flags associated with fuel-smuggling networks.