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OFAC announces sanctions tied to Mexican drug cartel
On November 17, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions pursuant to Executive Order 14059 against a Mexican drug cartel and its co-leaders for “having engaged in, or attempted to engage in, activities or transactions that materially contributed to, or pose a significant risk of materially contributing to, the international proliferation of illicit drugs or their means of production.” OFAC attributed its actions in part to a “critical” partnership with the Drug Enforcement Administration and the Mexican government. As a result of the sanctions, all property and interests in property belonging to the sanctioned persons subject to U.S. jurisdiction are blocked and must be reported to OFAC. Additionally, “any entities that are owned, directly or indirectly, 50 percent or more by one or more blocked persons are also blocked.” U.S. persons are also generally prohibited from engaging in any dealings involving the property or interests in property of blocked or designated persons.
OFAC sanctions drug network
On October 19, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions pursuant to Executive Order 14059 against an individual and a drug trafficking organization, two Mexican nationals and members of the designated drug trafficking organization, and three Mexico-based transportation companies. According to OFAC, the designated network evolved into a sophisticated network that is involved in the importation and transport of multi-ton quantities of illicit drugs from Mexico to the U.S. OFAC noted that the designations are the result of OFAC’s ongoing collaboration with Homeland Security Investigations San Diego Strike Force Group, U.S. Customs and Border Protection’s National Targeting Center, and the Government of Mexico. As a result of the sanctions, all property and interests in property belonging to the sanctioned entities in the U.S. are blocked and must be reported to OFAC. Additionally, “any entities that are owned, directly or indirectly, 50 percent or more by one or more blocked persons are also blocked.” OFAC also noted that “persons that engage in certain transactions with the individuals and entities designated today may themselves be exposed to sanctions or subject to an enforcement action.”
OFAC sanctions Mexican cartel facilitator
On July 11, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions pursuant to the Foreign Narcotics Kingpin Designation Act against an individual engaged in the trafficking of high-caliber firearms from the U.S. to a Mexican drug organization. According to OFAC, the designated individual acted for or on behalf of a violent drug trafficking organization based in Mexico, which is responsible for a significant proportion of drugs trafficked into the U.S. OFAC further noted that the designation “is the result of ongoing efforts by U.S. agencies and the Government of Mexico to disrupt Mexican drug trafficking organizations’ procurement of weapons, including those sourced in the United States.” As a result of the sanctions, all property belonging to the sanctioned persons subject to U.S. jurisdiction are blocked and must be reported to OFAC. U.S. persons are also generally prohibited from engaging in any dealings involving the property of blocked or designated persons.
OFAC sanctions individuals connected to Mexican cartels
On June 2, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions pursuant to Executive Order 14059 against six individuals for engaging with a Mexico-based drug traffic organization. Under Secretary of the Treasury for Terrorism and Financial Intelligence Brian E. Nelson stated that “[v]iolence and corruption have been critical to [the organization’s] growth in the past decade,” which has “fueled the cartel’s territorial expansion, and with it a greater capacity to traffic deadly drugs to the United States.” The sanctions are the result of a collaboration between Treasury, the Government of Mexico, and the U.S. Drug Enforcement Administration (DEA) with support from the U.S. Customs and Border Protection. As a result of the sanctions, the designated persons’ property located in the U.S. or held by U.S. persons is blocked and must be reported to OFAC. Additionally, OFAC regulations generally prohibit U.S. persons from participating in transactions with the designated persons.
International medical waste provider agrees to $84 million FCPA settlement
On April 20, the DOJ entered into a deferred prosecution agreement (DPA) with an Illinois-based international medical waste management company, in which the company agreed to pay a fine of approximately $52.5 million related to a conspiracy to violate the FCPA’s anti-bribery provision and books and records provisions. Together with a related resolution with the SEC, and with various foreign authorities, the total resolution will reach over $84 million.
According to the DOJ, between 2011 and 2016, the company participated in a scheme to bribe officials at government agencies and instrumentalities in Brazil, Mexico, and Argentina to obtain and retain business and to secure improper advantages in connection with providing waste management services. An executive at the company’s Latin America division directed employees in the company’s offices in Brazil, Mexico, and Argentina to pay bribes, typically in cash, that were calculated as a percentage of the underlying contract payments owed to the company from government customers.
As part of the DPA, the company agreed to cooperate with the DOJ’s ongoing or future investigations, to improve its compliance program, and to retain an independent compliance monitor for two years, followed by self-reporting for the remainder of the term.
The DOJ noted that in addition to cooperation and remediation the resolution reflects a number of factors including, the company’s (i) “failure to voluntarily and timely disclose the conduct that triggered the investigation”; and (ii) “the nature, seriousness, and pervasiveness of the offense.”
The SEC simultaneously announced a resolution of a related matter, in which the company consented to a cease-and-desist order finding violations of the FCPA’s anti-bribery, books and records, and internal accounting controls provisions. According to the SEC, the scheme also included sham third-party vendors who used false invoices to conceal cash payments to government clients. In addition, the company failed to have sufficient internal accounting controls in place to prevent or detect the misconduct and failed to implement its FCPA policies or procedures prior to 2016. Under the terms of the order, the company agreed to pay $28.2 million in disgorgement and prejudgment interest, of which up to $4.2 million will be offset by disgorgement paid to foreign authorities.
OFAC sanctions Guatemalan drug trafficking organization connected to Mexican cartels
On March 18, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions pursuant to Executive Order 14059 against a drug trafficking organization tied to Mexican cartels, as well as the organization’s leaders, for engaging in actions that threaten the people and security of the U.S. and Guatemala. Under Secretary of the Treasury for Terrorism and Financial Intelligence Brian E. Nelson stated that “Treasury and our U.S. and Guatemalan government partners will continue to use every available resource to dismantle these criminal networks” that have “engaged in, or attempted to engage in, activities or transactions that materially contributed to, or pose a significant risk of materially contributing to, the international proliferation of illicit drugs or their means of production.” As a result of the sanctions, the designated persons’ property located in the U.S. or held by U.S. persons are blocked and must be reported to OFAC. Additionally, OFAC regulations generally prohibit U.S. persons from participating in transactions with the designated persons.
OFAC sanctions additional Mexican national linked to narcotics trafficking
On February 17, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions pursuant to Executive Order 14059 against a Mexican national for his role in facilitating various illicit activities in Puerto Vallarta, Jalisco, Mexico on behalf of the Cartel de Jalisco Nueva Generacion (CJNG). CJNG “uses this renowned tourist destination as a strategic stronghold not only for drug trafficking but also money laundering, extortion, kidnappings, and assassinations,” Under Secretary of the Treasury for Terrorism and Financial Intelligence Brian E. Nelson stated. “Treasury will continue working with U.S. partners and the Mexican government to expose and disrupt CJNG, from its leadership to its facilitators.” The designated individual joins other previously designated businesses and individuals linked to CJNG for playing “critical roles in CJNG’s drug trafficking activities, including money laundering.” As a result of the sanctions, the designated individual’s property located in the U.S. or held by U.S. persons is blocked and must be reported to OFAC. Additionally, OFAC regulations generally prohibit U.S. persons from participating in transactions with the designated individual.
OFAC sanctions drug traffickers
On February 10, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions pursuant to Executive Order 14059 against two individuals for materially contributing to the illicit activities of major Mexican cartels to traffic drugs into the U.S. According to OFAC, the action, which was the result of collaboration between OFAC and the Drug Enforcement Administration, provides that all property and interests in property of sanctioned individuals in the U.S. or in the possession or control of U.S. persons must be blocked and reported to OFAC. OFAC notes that its regulations generally prohibit all transactions by U.S. persons that involve any property or interests in property of designated or otherwise blocked persons.
OFAC sanctions Mexican nationals
On October 6, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions pursuant to the Foreign Narcotics Kingpin Designation Act against four individuals who are allegedly senior members of a Mexican-based drug cartel, which is said to be responsible for trafficking deadly drugs into the U.S. As a result of the sanctions, all property and interests in property subject to U.S. jurisdiction that belong to the sanctioned persons must be blocked and reported to OFAC. U.S. persons are also generally prohibited from engaging in any dealings involving the property or interests in property of blocked or designated persons. OFAC further notes that the designations against the individuals were made in collaboration with the Drug Enforcement Administration and Mexico’s Financial Intelligence Unit.
OFAC sanctions Mexican national
On September 22, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions pursuant to the Foreign Narcotics Kingpin Designation Act against a Mexican-based cartel boss. OFAC noted that the designated individual allegedly oversaw a drug trafficking corridor and is allegedly responsible for smuggling drugs in the U.S. OFAC also designated seven other Mexican nationals and two Mexican entities. As a result of the sanctions, all property and interests in property belonging to the sanctioned persons subject to U.S. jurisdiction are blocked and must be reported to OFAC. U.S. persons are also generally prohibited from engaging in any dealings involving the property or interests in property of blocked or designated persons.