The U.S. Treasury Department has sanctioned a network of companies and individuals linked to the Jalisco Nueva Generación Cartel (CJNG) for defrauding thousands of Americans through timeshare investment schemes in Puerto Vallarta. The CJNG, one of Mexico’s most powerful cartels, has been exploiting sophisticated methods to deceive U.S. citizens, using call centers and emails that appear legitimate to lure victims.
Sophisticated Fraud Operation
According to a statement from the Treasury Department, the CJNG fraudsters operate as seemingly professional entities on paper or over the phone but are, in reality, money launderers trained to defraud unsuspecting U.S. citizens. The cartel’s fraud network is primarily based in Puerto Vallarta, where the U.S. government, in collaboration with Mexican authorities, is intensifying efforts to dismantle these operations and weaken the CJNG’s financial activities.
How the Fraud Scheme Works
The fraud scheme involves locating U.S. citizens who own timeshares and making offers to buy them back, rent them out, or entice them with additional investment opportunities. These offers are made through calls from cartel-operated call centers and emails. Victims often send payments via wire transfers through U.S. banks to Mexican shell companies controlled by cartel-associated accountants.
The Mexican accountants sanctioned by the U.S. government include Griselda Margarita Arredondo Pinzon, Xeyda Del Refugio Foubert Cadena, and Emiliano Sanchez Martinez. These individuals are responsible for managing several companies that facilitate the fraud.
The Role of a Deceased Businessman
The fraud scheme was initiated with the help of a now-deceased Mexican lawyer and businessman, Omar Aguirre Barragán. According to U.S. government reports, Aguirre Barragán educated criminals on how to execute fraud schemes using timeshares as bait. His knowledge and expertise have enabled the CJNG to run these operations effectively, causing significant financial losses for American victims.
Thousands of Victims and Enormous Losses
The Treasury Department, citing data from the Federal Bureau of Investigation (FBI), revealed that approximately 6,000 U.S. citizens have fallen victim to the timeshare fraud. The cumulative losses reported between 2019 and 2023 amount to around $300 million. However, this figure likely underestimates the total losses, as many victims refrain from reporting the fraud due to embarrassment and other personal reasons.
In some cases, fraudsters have impersonated Mexican or U.S. authorities, including representatives from the Treasury Department’s Office of Terrorism and Financial Intelligence (OFAC), to gain victims’ trust and facilitate the scam.
CJNG’s Use of Fraud Proceeds
The funds obtained from defrauded victims are laundered through various businesses and trusts with the assistance of accountants and other professionals. These laundered funds are then used by the CJNG to support illicit activities such as drug trafficking and human trafficking.
The CJNG is notorious for trafficking fentanyl, a potent opioid, and other deadly drugs into the United States, exacerbating the opioid crisis and contributing to significant public health and safety issues.
Government Response and Sanctions
The U.S. Treasury Department is deploying all available tools to dismantle the CJNG’s fraudulent activities and bring those involved to justice. Sanctions have been imposed on the individuals and companies associated with the fraud, aiming to curb the cartel’s financial capabilities and disrupt its operations.
The collaboration between U.S. and Mexican authorities is crucial in addressing this transnational crime. Efforts are ongoing to trace and recover the defrauded funds, hold accountable those responsible for the fraud, and prevent further victimization of American citizens.
Preventing Future Frauds
The Treasury Department and the FBI urge U.S. citizens to exercise caution when approached with timeshare investment offers, especially from unknown or unsolicited sources. Verifying the legitimacy of such offers through trusted financial advisors or legal professionals can help prevent falling victim to similar scams.
Victims of fraud are encouraged to report their experiences to the appropriate authorities to aid in the investigation and prosecution of the criminals involved. By raising awareness and increasing vigilance, authorities hope to mitigate the impact of such fraudulent schemes and protect potential victims in the future.
The U.S. Treasury Department has sanctioned a network of companies and individuals linked to the Jalisco Nueva Generación Cartel (CJNG) for defrauding thousands of Americans through timeshare investment schemes in Puerto Vallarta. The CJNG, one of Mexico's most powerful cartels, has been exploiting sophisticated methods to deceive U.S. citizens, using call centers and emails that appear legitimate to lure victims.