Background on the Accused Institutions
CiBanco, Intercam, and Vector are Mexican financial institutions that have recently come under scrutiny from the United States Department of Treasury’s Financial Crimes Enforcement Network (FinCEN). These institutions have been accused of being “primary sources of concern” related to money laundering and illicit trafficking of opioids.
FinCEN’s Accusations
CiBanco
In 2023, an employee allegedly knowingly facilitated the creation of a CiBanco account to launder $10 million on behalf of a member of the Gulf Cartel. Additionally, between 2021 and 2024, CiBanco processed over $2.1 million in payments on behalf of Mexican-based companies to Chinese entities known for sending illicit chemical precursors to Mexico.
Intercam
According to FinCEN, Intercam executives met directly with alleged members of the Jalisco New Generation Cartel (CJNG) in late 2022 to discuss money laundering schemes, including fund transfers from China. Between 2021 and 2024, a Chinese-based company associated with an individual sending illicit chemical precursors from China to Mexico received over $1.5 million from Mexican-based companies through Intercam.
Vector
FinCEN reported that a money launderer linked to the Sinaloa Cartel allegedly used various methods to launder $2 million from the US to Mexico through Vector between 2013 and 2021. Furthermore, from 2018 to 2023, Vector allegedly made over $1 million in payments on behalf of Mexican-based companies to Chinese entities known for sending illicit chemical precursors to Mexico, highlighting significant deficiencies in Vector’s Anti-Money Laundering (AML) controls.
Reactions to FinCEN’s Sanctions
Mexico’s Tax Administration Service (SHCP)
Following the US Treasury’s accusations against CiBanco, Intercam, and Vector for potential money laundering, Mexico’s Secretariat of Finance and Public Credit (SHCP) stated that the US Treasury has yet to provide concrete evidence. However, they have initiated a review of the accused institutions and requested proof linking them to illicit activities.
Claudia Sheinbaum, Mexico City’s Mayor
Mayor Claudia Sheinbaum addressed the FinCEN sanctions, stating that she and Hacienda requested more information. She emphasized that if there is evidence of money laundering, action will be taken; otherwise, they cannot act without concrete proof.
Comisión Nacional Bancaria y de Valores (CNBV)
Hours after the mayor’s statement, CNBV’s Board of Governors decreed temporary managerial intervention for CiBanco and Intercam. This decision came after the US Treasury’s accusations that these banks, along with Vector Casa de Bolsa, allegedly enabled money laundering operations related to fentanyl trafficking.
Asociación de Bancos de México (ABM)
The ABM, the apex body of Mexican banks, clarified that these interventions do not pose a systemic risk or affect the stability of Mexico’s financial system, which remains solid and well-capitalized. The ABM emphasized that the intervention aims to create a stable environment for institutions to operate normally while ensuring compliance with regulatory standards.
Responses from CiBanco, Intercam, and Vector
CiBanco
Following the temporary intervention by CNBV, CiBanco stated its commitment to collaborate with regulatory authorities in Mexico and the US, adhering to legal frameworks to address any concerns. The bank assured clients that their assets are protected under Mexico’s Protected Savings Bank Act and maintained open communication with relevant authorities.
Intercam
Intercam Banco firmly denied any money laundering allegations in a categorical statement. They refuted the FinCEN accusation, asserting their integrity and commitment to legal operations.
Vector
Vector Casa de Bolsa categorically rejected any imputation compromising its institutional integrity. However, they reiterated their willingness to collaborate with Mexican and US authorities to clarify any doubts, emphasizing their commitment to responsibility, legality, and transparency.
Consequences of FinCEN’s Accusations
SHCP reported that CiBanco, Intercam, and Vector experienced financing issues following the US Treasury’s money laundering accusations. Edgar Amador Zamora, Mexico’s Secretary of Finance, explained that these problems were identified post-financial market closure, leading to the temporary managerial intervention to ensure no disruptions and safeguard clients’ savings.
Credit Rating Agencies Downgrade
HR Ratings lowered the credit ratings of CiBanco and Intercam Banco, placing them under negative outlook. This decision came after CNBV’s temporary intervention of both banks, with HR Ratings warning of a rating decrease if CiBanco and Intercam face payment defaults to creditors.
Fitch Ratings also adjusted downward the credit ratings of CiBanco, Intercam Banco, and Vector Casa de Bolsa following the US Treasury’s money laundering allegations related to fentanyl trafficking. Fitch Ratings explained that the negative outlook reflects uncertainty about a more significant adverse impact on the financial entities’ credit profiles.
