Financial Crime World

Mexico’s Efforts to Combat Money Laundering Wither Under Peña Nieto Administration

Despite passing anti-money laundering legislation in 2013, Mexico’s efforts to combat money laundering have weakened under the current administration of President Enrique Peña Nieto.

Grim Statistics

Government statistics paint a grim picture of Mexico’s ability to combat money laundering. According to documents obtained from Mexico’s Attorney General’s Office:

  • Between 2001 and 2014, 33 money-laundering groups were dismantled and approximately $300 million was seized.
  • However, the majority of these groups (23) were dismantled during the administration of Felipe Calderon, while only three were taken down under President Enrique Peña Nieto.

Decline in Seizures

During the first two years of Peña Nieto’s presidency, the amount of laundered money seized dropped to around $13 million, compared to over $90 million during the same period under Calderon. National security expert Gerardo Rodriguez Sanchez Lara has criticized these figures as “laughable” given the tools available to investigators.

Estimated Annual Losses

The Secretariat of Property and Public Credit estimates that $10 billion is laundered annually in Mexico, while some US officials have put this number at a staggering $29 billion. Experts say that combating money laundering is an uphill task due to the creative methods used by criminal networks to legalize their ill-gotten gains.

Limited Progress

Despite efforts to strengthen anti-money laundering measures, including the 2013 law limiting cash transactions and requiring reporting of suspicious financial activity, progress has been slow. Fewer prosecutions and seizures have taken place since the legislation was passed, leading experts to question the government’s willingness to dedicate the necessary resources to tackling the problem.

Challenges

Angelica Ortiz Dorantes, an expert on money-laundering prevention, notes that while the drop in seized cash may be a sign of greater controls and preventative measures, it is still concerning. Rodriguez Sanchez adds that the weak capacity of the Financial Intelligence Unit and lack of means for filtering information are significant obstacles to effective anti-money laundering efforts.

Conclusion

Money laundering is a critical component of organized crime in Mexico, with criminal networks continually finding new ways to legalize their massive cash reserves. The Mexican government has struggled to combat this crime, despite passing legislation aimed at curbing the activity. As the PGR’s own figures suggest, progress has been slow, and it remains to be seen whether the government will take the necessary steps to address this issue.