PUERTO VALLARTA (PVDN) – Timeshare is never a good investment, even more so when it’s a fraud on Americans by one of the world’s largest and most dangerous cartels that call Puerto Vallarta home.
In an alarming revelation that has ignited a multi-agency investigation spanning both sides of the border, the U.S. Department of the Treasury has unveiled a timeshare fraud scheme orchestrated by the powerful Jalisco Nueva Generación cartel (CJNG). The revelation came to light as part of an investigation into the brutal murder of seven young individuals in the Mexican state of Jalisco.
The international scam, which stretches from local police in Zapopan, Mexico, to the U.S. Treasury Department, demonstrates the expanding capability of organized crime syndicates to diversify their illegal income streams. According to the U.S. authorities, the cartel has been utilizing a network of companies to exploit retired Americans, tricking them into buying or renting non-existent vacation homes on the beaches of Mexico.
The operation, run by a Puerto Vallarta-based cell of the CJNG, has reportedly targeted elderly U.S. citizens, defrauding them of their life savings. Although it remains unclear whether the seven murdered individuals were involved in the scam, the investigation continues to uncover tantalizing clues.
In a statement, U.S. authorities confirmed the imposition of sanctions on seven individuals and 19 companies linked to the cartel. The action, according to Brian Nelson, undersecretary of Financial Intelligence at the Department of the Treasury, is aimed at disrupting a major revenue source for the CJNG, which has reportedly been heavily invested in the timeshare fraud operation in Puerto Vallarta.
Mexican national Eduardo Pardo Espino, 45, has been identified as the leader of this scam. The U.S. government has enacted sanctions against him and six other individuals purportedly under his command, aiming to block any assets and interests they may hold in the United States.
The implicated companies, located in Cancun, Guadalajara, Nayarit, and Puerto Vallarta, are alleged to have connections to or made payments to members of the CJNG. These shell companies, including Besthings, DantWoo Administrative Services, and Promotora Vallarta One, are believed to have provided cover for the illicit activities and served as a bridge between cartel leaders.
“The favorite victims of this scheme were elderly American citizens,” said a recent report by the U.S. Treasury. A warning issued by the U.S. Embassy in Mexico in May 2023 cautioned U.S. citizens to exercise vigilance when considering timeshare investments or purchasing real estate in Mexico.
The tactics employed by the scammers were sophisticated, with some creating convincing websites imitating legitimate American companies and presenting false documentation to authorities. Furthermore, the scammers would often pose as representatives of the Mexican government or financial institutions when their victims became suspicious, promising to recover lost funds for a fee, only to vanish after receipt of the payment.
This revelation has surprised experts, including Carlos Antonio Flores, a researcher at the Center for Research and Higher Studies in Social Anthropology (Ciesas) in Mexico, who noted that the profits from such operations would typically be less than the cartel’s other known illegal activities, like drug trafficking or fuel theft. He suggested that if the information is accurate, it implies that the cartel is diversifying its illicit operations.
This report puts Puerto Vallarta, a popular tourist destination, at the heart of the operation. Insight Crime, an organization that investigates organized crime, warns that the situation could be just “the tip of the iceberg” of CJNG’s influence in the city’s tourism sector, which they have reportedly exploited for years to launder money.
