US Sanctions Sinaloa Cartel Crypto Money-Laundering Network

The U.S. Treasury’s Office of Foreign Assets Control on Wednesday designated 12 individuals and two companies for moving bulk cash from drug sales in the United States into cryptocurrency to benefit the Sinaloa Cartel. OFAC said the proceeds came from fentanyl, methamphetamine and cocaine sales.

In its initial announcement OFAC named six individuals and two businesses and identified Armando de Jesus Ojeda Aviles as the head of the network. The other named individuals were Jesus Alonso Aispuro Felix, Rodrigo Alarcon Palomares, Alfredo Orozco Romero, Amalia Margarita Romero Moreno and Liliana Orozco Romero. The businesses listed were security firm Grupo Especial Mamba Negra and the Chihuahua restaurant Gorditas Chiwas.

A further six people were added to the list for related conduct, bringing the total to 12. OFAC described the operation as collecting bulk cash from U.S. drug sales, processing the funds through companies and front businesses to hide their source, and converting the cash into cryptocurrency to send to cartel accounts in Mexico.

OFAC said Ojeda Aviles is part of the “Chapitos” faction formed by the sons of Joaquín “El Chapo” Guzmán Loera and that he oversaw narcotics shipments from Mexico into the United States.

The Treasury’s designations freeze all property and interests in property in the United States belonging to the designated people and companies, or in the possession or control of U.S. persons, and require those assets to be reported. Entities 50 percent or more owned by any designated person are also blocked. The designations generally bar U.S. persons from transacting with the listed parties and require U.S. financial institutions to block and report holdings.

The Treasury has previously targeted other networks that converted illicit funds into digital assets, including the Venezuelan group Tren de Aragua, and officials said cryptocurrency can be used to move value quickly and obscure the origin of funds.

The Treasury’s announcement read: “Treasury will continue to target terrorist cartels and their fentanyl trafficking networks to protect our communities and Keep America Safe.”