[Video] Former Mexican Governor Detained in Spain

1/19/2016 Wilson Center Trending

viri wilson center trending

It’s been a good week for Mexican law and order. Following the recent capture of El Chapo, comes the news that Former Mexican Governor Moreira has been detained in Spain as part of an ongoing money-laundering investigation. Wilson Fellow Viridiana Rios provides analysis.

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Viridiana Rios, a Global Fellow with the Wilson Center’s Mexico Institute, is an expert in Mexico’s subnational economy, citizen security and rule of law. She analyzes labor markets, productivity, and development indicators at Mexico, and disentangles how violence, conflict, rule of law, and corruption have affected them. Her career has taken her from positions as public officer and applied researcher, to entrepreneur and journalist. As a public officer, Viridiana has served as adviser to Mexico’s Minister of Finance, and to Mexican President’s Spokesman. As a researcher, she has worked with the Guggenheim Foundation of New York City, the United Nations, USAID, The World Bank, The Center for US-Mexico Studies at the University of California in San Diego, the Trans-border Institute at the University of San Diego, and Mexico’s ministries of social development (SEDESOL), education (SEP), and security (SNSP). In a more entreprenuerial gig, Viridiana directed México ¿Cómo Vamos?, a start-up think tank specialized in translating academic knowledge to the language of policy makers and the press. Finally, as journalist, she has a weekly column at Excélsior, a Mexican national newspaper.

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US Banks Close Branches Along Mexico Border to Prevent Money Laundering

5/27/2015 InSight Crime

Major US banks have recently closed branches along the southern border with Mexico in an attempt to crack down on money laundering, a reflection of the ease with which Mexican drug traffickers can legitimize illicit proceeds north of the border.

In recent months, major banks such J.P. Morgan and Bank of America have closed their branches in the border town of Nogales, Arizona, reported The Wall Street Journal. Other banks, including Wells Fargo and Chase, have reportedly closed hundreds of customer accounts, many of which belonged to Mexican nationals.

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Mexico Say Expects Kingpin Extradition Request From U.S. Soon

Reuters, 1/20/2015

handcuffsMexico’s attorney general said on Tuesday he expects the United States to submit an extradition request soon for drug lord Joaquin “Shorty” Guzman, who was Mexico’s most wanted man until his capture last February.

“I’m aware they’re going to ask me, and it won’t be a problem to do all the paperwork to determine at the time what will be most convenient,” Attorney General Jesus Murillo told reporters in Mexico City of the U.S. extradition request.

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Former Mexico official pleads guilty in corruption probe

09/17/14 Reuters

justice-systemA former top official in the northern Mexican state of Coahuila, whose case became a symbol of Mexican government corruption, has pleaded guilty in Texas to federal money laundering charges, according to court documents. Hector Javier Villarreal Hernandez was charged in Mexico with using his position as Coahuila’s Secretary of Finance to take out nearly a quarter billion dollars in fraudulent loans between 2008 and 2011, using the credit of the state as collateral.

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Mexico’s New Law to Combat Money Laundering to use “Kingpin” List

shutterstock_113478238AlJazeera, 4/15/14

Mexico has announced plans to fight money laundering by using “kingpin” lists like those issued by the United States, although unlike the public U.S. list, Mexico will make its registry confidential, a Mexican official said Monday. Alberto Elias Beltran, the official in charge of implementing a new money laundering law at the Finance Department, said the list will be made available only to authorities, anyone accused of money laundering and financial institutions.

“There could be a person who follows the procedure to be excluded from the list and we don’t want them to affect their reputation by making this list public,” Elias Beltran said. The criteria that will be used to put a person or a business on the list hasn’t yet been determined but the government hopes the first list will be ready by the end of April, he said.

Elias Beltran added that the list will be immediately sent to financial institutions that will have to “immediately suspend any operation or service being provided to those added to the list.” The law mainly bans those on the list from using Mexico’s financial system, including using current bank accounts or opening new ones, but it doesn’t currently provide for criminal charges against anyone, he said.

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Legal team of ex-governor of Mexico border say US charges based on false accusations

Fox News, 12/5/2013

tamaulipasLawyers for a former Mexican governor charged in the United States with money laundering and drug trafficking say the charges are based on false accusations by people trying to bargain with U.S. prosecutors.

Attorney Josel Androphy says witnesses against former Tamaulipas Gov. Tomas Yarrington gave false information to get leniency from the U.S. government. Androphy spoke Thursday in Mexico City along with three Mexican lawyers for Yarrington.

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INFOGRAPHIC: Money Laundering (Part 2)

Prepared by Constance McNally

Money Laundering - Part 2

The Black Market Peso Exchange (BMPE) is a system by which drug trafficking organizations (DTOs) both move and launder earnings from drug sales.[1] This is traditionally accomplished by a broker selling U.S. located proceeds from DTO sales to foreign importers who need U.S. dollars to purchase American goods.[2] It was originally used by Columbian DTOs,[3] but has been adopted by Mexican DTOs. [4]

As depicted above, traffickers located in the United States drop off U.S. dollars they receive from drug sales with a peso broker. This broker usually makes small deposits under the $10,000 limit at which banks must report the transaction. The broker also has a contact or broker with whom they have a partnership in their home country, in this example Mexico, who handles delivery of the equivalent peso amount to the DTOs in Mexico. The broker in Mexico uses pesos obtained by Mexican importers looking to purchase American goods with U.S. dollars for the delivery to the DTOs. The broker in the U.S. then uses the U.S. dollar denominated drug proceeds deposited with him by the DTOs to pay for the goods purchased by the Mexican importer. [5]  The broker makes a profit on the exchange rate spread and also charges a small fee. [6] DTOs are able to launder their profits, legitimate U.S. companies knowingly or unknowingly are able to increase sales and profits, and importers save money on exchange rates and fees.[7] The system has proven so successful that it was identified by the Financial Crimes Enforcement Network, a division of the U.S. Treasury Department, as “the single most efficient and extensive money laundering “system” in the Western Hemisphere.”[8] The simplicity of the system and its potential variations makes it difficult to disrupt. Future tools for disrupting certain aspects of it, such as tightened currency transaction limits, may prove to be useful in combatting its success.

Continue reading “INFOGRAPHIC: Money Laundering (Part 2)”