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The Trump administration is intensifying efforts to disrupt the financial networks of Mexican drug cartels, focusing on tracking and halting the flow of illicit funds.
A Treasury Department official revealed that the administration is targeting the estimated $18 to $39 billion annually funneled to cartels through various channels, including small cash transactions and complex money laundering schemes. By designating certain cartels as foreign terrorist organizations, the administration aims to leverage additional legal tools to freeze assets and prosecute those involved in financing these groups.
“One of the most important things that the president did upon coming into office was to declare a number of the narco groups terrorist organizations,” Deputy Secretary of the Treasury Michael Faulkender told The Daily Wire. “What that does is it unleashes additional authorities at Treasury for us to better target some of the financial activities that these cartels are engaging in.”
To combat the sophisticated methods cartels use to launder money, the Treasury’s Financial Crimes Enforcement Network (FinCEN) has lowered the reporting threshold for cash transactions from $10,000 to $200 in 30 ZIP codes along the U.S.-Mexico border. This measure targets money services businesses that handle frequent, low-value transfers, a tactic cartels employ to evade detection. The administration believes that increasing scrutiny on these transactions will help identify and dismantle the financial infrastructure supporting drug trafficking operations.
In addition to domestic measures, the administration is working with international partners to identify and sanction individuals and entities involved in laundering cartel proceeds. Recent actions include sanctions against members of the Jalisco New Generation Cartel (CJNG) and the Sinaloa Cartel, freezing their U.S.-based assets and prohibiting American citizens from conducting business with them. These steps aim to disrupt the cartels’ ability to finance their operations, which often involve violence and the trafficking of fentanyl into the United States.
The administration’s approach also involves enhancing the capabilities of financial institutions to detect and report suspicious activities. By implementing advanced analytics and artificial intelligence tools, banks and money services businesses are better equipped to identify patterns indicative of money laundering. This proactive stance is intended to prevent cartels from exploiting the financial system and to support law enforcement efforts in tracing illicit funds back to their sources.
“It’s one thing to have our partners at [the Department of Homeland Security] work on stopping the flow of people and drugs, but we can also use our financial tools to go after the money,” said Faulkender. “If the money is not flowing back south, then there’s less of an incentive to bring the drugs and the guns and some of the illicit activity up to the north.”
Overall, the Trump administration’s multifaceted strategy focuses on cutting off the financial lifelines of Mexican drug cartels by tightening regulations, increasing international cooperation, and leveraging technological advancements. By targeting the money that fuels these criminal organizations, the administration aims to reduce their capacity to operate and to mitigate the impact of drug trafficking on communities across the United States.
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