AFC POLICY
8. Review contractual agreements
▪ Ensure that AML / CTF / sanctions compliance commitments appear in contractual arrangements with counterparties, suppliers, vendors and other relevant parties.
9. Review and where warranted update the scope and frequency of sanctions-related screening
▪ Revise your sanctions compliance program to expand the scope and frequency of sanctions-related screening. For example, confirm that counterparties are not owned 50 % or greater by sanctioned persons or entities.
▪ For U. S. FIs who may need new financial partners in Mexico following the effective date of the FinCEN orders, conduct sufficient diligence and vetting of potential Mexico-based FI partners to ensure sound compliance controls.
10. Additional strategies
▪ Adopt IP geo-blocking and VPN detection( if customers / related parties may be located in a sanctioned jurisdiction).
▪ Require all counterparties to provide identifying information sufficient to conduct sanctions screening.
▪ Train compliance teams and first line on the scope of the orders and risk of inadvertent violations.
▪ Stay alert for frequently asked questions, clarifications and guidance from FinCEN and OFAC.
Conclusion
FinCEN has not wasted time in providing further guidance to industry. On August 28, it issued 1) an advisory warning how Chinese money laundering networks( CMLNs) facilitated more than $ 300 billion of suspicious activity through U. S. FIs between 2020 and 2024, often on behalf of Mexico-based drug cartels and involving illicit fentanyl trade, fraud, human trafficking and human smuggling, and urged FIs to be vigilant given the threat to the U. S. financial system, 11 and 2) an FTA highlighting the scope and breadth of CMLN activity in the U. S. 12
The use of Section 2313a and subsequent, aggressive actions by multiple U. S. government agencies such as FinCEN’ s August 28 advisory and FTA underscore a new era in countering global drug finance. The designations of the Mexican institutions aim to cut off the financial lifelines of drug trafficking organizations and disrupt the illicit opioid flow into the U. S. Although the orders focus on operations in Mexico, the practical effects will be felt by FIs globally.
Marilu Jimenez, esq, CAMS, founder, FINCAdvisors, San Juan, PR, Mjimenez @ fincadvisors. com, David Stier, partner, White Collar Defense, Government Enforcement and Investigations, DLA Piper LLP, Washington, D. C., USA, David. Stier @ us. dlapiper. com, 1
“ Memorandum: Total Elimination of Cartels and Transnational Criminal Organization,” U. S. Department of Justice, February 5, 2025, https:// www. justice. gov / ag / media / 1388546 / dl? inline
2
“ Designation of International Cartels,” U. S. Department of State, February 20, 2025, https:// www. state. gov / designation-ofinternational-cartels
3
“ FinCEN issues Southwest Border Geographic Targeting Order,” Financial Crimes Enforcement Network, March 11, 2025, https:// www. fincen. gov / news / news-releases / fincen-issuessouthwest-border-geographic-targeting-order
4
“ Fentanyl-Related Illicit Finance: 2024 Threat Pattern & Trend Information,” Financial Crimes Enforcement Network, April 2025, https:// www. fincen. gov / sites / default / files / shared / FinCEN-FTA-Fentanyl. pdf
5
“ FinCEN Alert on Oil Smuggling Schemes on the U. S. Southwest Border Associated with Mexico-Based Cartels,” Financial Crimes Enforcement Network, May 1, 2025, https:// www. fincen. gov / system / files / shared / FinCEN-Alert-Oil-Smuggling-FINAL-508C. pdf
6
“ Treasury Targets Major Mexican Cartel Involved in Fentanyl Trafficking and Fuel Theft,” U. S. Department of the Treasury, May 1, 2025, https:// home. treasury. gov / news / press-releases / sb0125
7
“ Treasury Issues Unprecedented Orders under Powerful New Authority to Counter Fentanyl,” Financial Crimes Enforcement Network, June 25, 2025, https:// www. fincen. gov / news / news-releases / treasury-issuesunprecedented-orders-under-powerful-new-authority-counter
8
“ Imposition of Special Measure Prohibiting Certain Transmittals of Funds Involving CIBanco, S. A., Instiucion De Banca Multiple,” Financial Crimes Enforcement Network, June 30, 2025, https:// www. federalregister. gov / d / 2025-11993 / p-44
9
“ Imposition of Special Measure Prohibiting Certain Transmittals of Funds Involving Vector Casa de Bolsa, S. A. de C. V.,” Financial Crimes Enforcement Network, June 30, 2025, https:// www. federalregister. gov / documents / 2025 / 06 / 30 / 2025-11991 / imposition-of-special-measureprohibiting-certaintransmittals-of-funds-involving-vector-casa-de
10
“ Treasury Extends Effective Dates of Orders Issued Under New Authority to Counter Fentanyl,” Financial Crimes Enforcement Network, July 9, 2025, https:// www. fincen. gov / news / news-releases / treasury-extendseffective-dates-orders-issued-under-new-authority-counter;“ Treasury Extends Effective Dates of Orders Issued Under New Authority to Counter Fentanyl,” Financial Crimes Enforcement Network, August 19, 2025, https:// www. fincen. gov / news / news-releases / treasury-extendseffective-dates-orders-issued-under-new-authority-counter-0
11
“ FinCEN Advisory on the Use of Chinese Money Laundering Networks by Mexico-Based Transnational Criminal Organizations to Launder Illicit Proceeds,” Financial Crimes Enforcement Network, August 28, 2025, https:// www. fincen. gov / sites / default / files / advisory / 2025-08-28 / FinCEN-Advisory-CMLN-508. pdf
12
“ Chinese Money Laundering Networks: 2020-2024 Threat Pattern & Trend Information,” Financial Crimes Enforcement Network, August 2025, https:// www. fincen. gov / sites / default / files / shared / 4000-10-INV-144549- S3F6L-FTA-CMLN-508. pdf
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