On May 1, 2025, the Financial Crimes Enforcement Network (FinCEN), in coordination with OFAC, DEA, FBI, and HSI, issued an alert warning of oil smuggling schemes linked to Mexico-based drug cartels—including CJNG, the Sinaloa Cartel, and the Gulf Cartel. These groups, in collusion with corrupt Pemex insiders and brokers, steal crude oil and mislabel it as “waste oil” to smuggle it into the U.S. Once in the country, small, complicit U.S. importers sell the oil at steep discounts, generating illicit profits.
Red Flags Identified in the Alert:
- Small U.S.-based oil, freight, or importing companies showing unusually high profits or transactional activity
- Selling WTI or other crude oil at prices significantly below market rates
- No or limited online presence, or use of deceptive websites mimicking legitimate companies
- Claims to trade exclusively in crude oil, yet makes payments for waste oil or hazardous materials
- Sudden purchases of waste oil from a limited number of suppliers in Mexico or the U.S.
- Payments sent for hazardous materials without appropriate EPA registration
- Payments made to non-oil-related companies for hazardous materials
- High-volume transactions with Mexican or U.S. companies lacking a digital footprint
- Receiving funds for crude oil sales and then sending payments for waste oil purchases
- Importing company lacks EPA registration but buys waste oil from U.S. firms and pays Mexican entities
- U.S. importer receives funds from U.S. oil companies and transfers money to a small number of Mexican firms
- U.S. firm claiming to import waste oil is actually a shell company for a Mexican entity
- Ultimate consignee of hazardous materials is registered to a residential address
- Entity is linked to cartel actors or individuals/entities designated by OFAC
Read more at FCC Times https://www.fcctimes.com/2025/05/01/u-s-treasury-warns-banks-of-mexican-cartel-linked-oil-smuggling-scheme/?utm_source=RZOLUTWebsite&utm_medium=FCCRegUpdate28Jul25
