U.S. Treasury Secretary Janet Yellen on Wednesday announced new sanctions against 15 individuals and two Mexican companies linked to a drug cartel as she seeks to improve cooperation with Mexico in stemming the flow of the deadly opioid fentanyl to the U.S.
Yellen unveiled the sanctions on her first trip to Mexico since taking office in 2021. They are aimed at disrupting the Beltran Leyva Organization, which the Treasury describes as “one of the most powerful drug trafficking organizations in the world,” and a major supplier of cocaine and now fentanyl, to the U.S.
During her visit to Mexico, Yellen is aiming to sharpen both countries’ ability to find and cut off the flow of financing to drug cartels and their front companies. “We have authorities now that I think make it easier for us to go after middlemen who are not actually trading fentanyl itself but goods like pill presses and pharmaceuticals that aren’t export controlled,” Yellen told reporters.
“But when used as part of a cartel to facilitate the drug trade, we can now come down and put sanctions on those entities,” she added. Yellen toured a Mexican government crime lab that is pioneering the training of dogs to detect fentanyl precursor chemicals. She will meet with private sector finance executives and Mexico’s finance minister and central bank chief to improve information sharing. On Thursday, she is scheduled to meet with Mexican President Andres Manuel Lopez Obrador.
In remarks on Treasury’s efforts, she said that opioid overdoses, including fentanyl, are killing more than 1,500 people in America per week, making fentanyl the biggest killer of people aged 18-49 in the United States. The trip follows Treasury’s announcement on Monday of a counter-fentanyl “strike force” that will bring together the department’s resources, including the Office of Terrorism and Financial Intelligence and the Internal Revenue Service’s Criminal Investigation unit, to disrupt illicit drug trafficking, including through cryptocurrencies.
U.S. President Joe Biden and Chinese President Xi Jinping last month agreed to deepen cooperation to stem the flow of fentanyl precursor chemicals from China, which are often mixed by Mexican drug gangs before distribution in the U.S. Yellen said the drive for Mexico’s cooperation in enforcing sanctions is an important part of making good on the Biden-Xi anti-fentanyl pledge.
“We’re meeting with a number of the entities in Mexico that are providing us with information. And we’ll have a meeting with many of the banks tomorrow to discuss information sharing. They’ve been increasingly helpful in providing information that’s useful in tracing these (financial) flows.” The Treasury has been imposing sanctions — which aim to cut illicit actors off the U.S. dollar based financial system — for years, disrupting individual cartels, but the actions have failed to slow the overall flow of illicit drugs to the United States.
Jeffrey Schott, a senior fellow with the Peterson Institute for International Economics in Washington, said the U.S.-Mexico drugs trade and its associated security concerns has also becoming an impediment to business investment in Mexico. Inhibiting production and distribution of fentanyl, cocaine, heroin and other drugs is important, “but part of it needs to be to dampen the U.S. demand for the drugs. And we don’t seem to be doing a good job of that.”
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