1. Geographic risk monitoring
▪ Monitor transactions involving Mexican border states( e. g., Sinaloa, Tamaulipas, Sonora).
▪ Identify and flag frequent cross-border transfers between Mexico and the U. S.
▪ Watch for unusual patterns from known cartel-associated municipalities or regions.
2. Industry-specific awareness
▪ Engage in heightened diligence in connection with:
○ China-based counterparties in the chemicals or manufacturing industries and particularly those shipping pre-cursor chemicals and manufacturing equipment, or engaging in financial transactions that are not consistent with that customer’ s expected business activities.
○ Small or relatively unknown U. S.-based oil and / or oil transportation companies on or near the Southern border and / or with minimal online presence or websites designed to copy well-known oil companies, especially where such companies purport to ship hazardous or waste oil but do not have a license from the U. S. Environmental Protection Agency( EPA) for such activity.
3. Customer due diligence and enhanced due diligence( EDD)
▪ Conduct EDD on customers with cash-intensive businesses.
▪ Check for front or shell companies with minimal legitimate activity.
▪ Flag individuals with no clear source of income conducting large transactions.
▪ Conduct heightened due diligence when transacting business in or near areas where designated FTOs( including cartels) are known to operate. This may include background checks( or similar), and / or requiring counterparties to present documents / information confirming their bona fides.
4. Transaction monitoring rules and scenarios
▪ Identify structuring / smurfing patterns( e. g., deposits just below $ 10,000).
▪ Flag rapid in-and-out wire transfers, especially involving international destinations or large, rapid cash deposits or withdrawals by Chinese nationals with limited ties to the U. S.
▪ Look for multiple transactions across related accounts with no clear purpose.
▪ Introduce / expand automated“ red flag” indicators for heightened manual review.
5. Trade-based money laundering
▪ Review invoice values for under / overvaluation compared to market rates.
▪ Monitor use of unnecessary intermediaries in trade transactions.
▪ Analyze shipping activity to and from cartelinfluenced ports( e. g., Lázaro Cárdenas).
6. Monitoring cash movements
▪ Vet cash intensive clients operating between or among Mexico, the U. S. and China.
▪ Review high-volume ATM or branch deposits from high-risk regions.
▪ Watch for patterns in armored car deposits that lack documentation.
7. Informal transfer systems and alternative methods
▪ Identify use of prepaid cards or cryptocurrency for large or structured transactions.
▪ Detect informal transfer methods with no matching documentation( e. g., hawala-style transfers).
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