U.S. Pushes Mexico's Banks to Crack Down on Cartel Money Laundering

MEXICO CITY — The United States is intensifying pressure on Mexico's financial sector to curb money laundering, fentanyl trafficking and cartel financing, with senior officials warning that Mexican banks must do more to prevent organized crime from exploiting the country's financial system.

U.S. Under Secretary of the Treasury for Terrorism and Financial Intelligence John K. Hurley met this week in Mexico City with representatives of the Asociación de Bancos de México (ABM), Mexico's powerful banking association. The talks, held just months before the mandatory review of the U.S.-Mexico-Canada Agreement (USMCA), underscore Washington's determination to cut off cartel access to international finance.

Hurley told bank executives that U.S. public advisories and alerts should serve as a "roadmap" to strengthen compliance and stop the flow of drug money. He pointed to recent sanctions and enforcement actions as proof that the United States will not hesitate to punish institutions that fail to safeguard against cartel infiltration.

Sanctions on Mexican Financial Institutions

In June, the Treasury Department designated three Mexico-based financial entities — CIBanco, Intercam Banco and Vector Casa de Bolsa — as "institutions of primary money laundering concern" under the FEND Off Fentanyl Act. The move effectively barred certain U.S. banks from transacting with them, citing alleged ties to laundering money for cartels.

Following the U.S. action, Mexico's own banking regulator imposed fines totaling more than 185 million pesos (about $9.8 million). Intercam Banco received the largest penalty, followed by CIBanco and Vector. All three institutions denied wrongdoing, and Mexican officials said Washington had not presented enough evidence to substantiate the allegations.

Despite the denials, the penalties rattled Mexico's banking sector. In July, Mexico's government temporarily shifted the trust businesses of CIBanco and Intercam to state-owned development banks to protect clients while regulatory reviews continue.

Targeting Cartel Networks

The enforcement push has gone beyond banks. Just last week, the U.S. sanctioned members of the Los Mayos faction of the Sinaloa cartel, one of Mexico's most powerful drug-trafficking groups. Among those targeted was Hilda Araceli Brown Figueredo, a sitting federal lawmaker from President Claudia Sheinbaum's Morena party and former mayor of Playas de Rosarito.

Hurley cited those actions as part of a wider campaign by the administration of President Donald Trump to choke off cartel financing and disrupt fentanyl smuggling. "The private sector is on the front lines of this fight," Hurley said. "Banks have a duty to close the door on illicit finance."

Strained Relations

The crackdown has created friction between Washington and Mexico City. While Sheinbaum has pledged to uphold USMCA and cooperate with Canada and the United States on trade and security, Mexican regulators have pushed back against what they call politically motivated sanctions.

Bank executives privately worry that U.S. pressure could harm legitimate cross-border commerce if institutions are wrongly flagged. Yet Hurley insisted that the stakes — particularly fentanyl overdoses in the U.S. — leave no room for leniency.

What Comes Next

Analysts say Hurley's trip, his first overseas visit since confirmation in July, signals that financial intelligence will play a central role in the Trump administration's Mexico strategy. More sanctions and enforcement actions are likely in the coming months, especially as the U.S. prepares to renegotiate key aspects of USMCA in 2026.

For Mexico, the challenge will be balancing domestic financial stability with U.S. demands for aggressive action. The outcome could reshape the role of Mexican banks in the global financial system — and determine how far Washington is willing to go in its bid to starve the cartels of cash.