By Stefanie Eschenbacher and Stephen Eisenhammer
MEXICO CITY, June 30 (Reuters) - The U.S. Treasury said on Tuesday it had imposed sanctions on two Mexican nationals and nine entities tied to a cartel-linked smuggling scheme that moves fuel from the United States into Mexico without paying a hefty tax on the imports.
In a statement, the Treasury said the scheme is linked to Mexico's Jalisco New Generation Cartel (CJNG) and part of an illegal enterprise generating hundreds of millions of dollars annually
for the cartel. Smuggled fuel and stolen crude oil have become the second-largest revenue source for Mexican cartels after drugs, according to the U.S. government.
"Today's action highlights the extent to which Mexico's cartels are expanding beyond traditional drug trafficking to generate revenue for their criminal organizations, which continue to traffic deadly drugs that kill Americans," said Secretary of the Treasury Scott Bessent.
Mexico applies a levy known as IEPS on a wide variety of goods, including imported diesel and gasoline.
Mexican cartels and their networks can evade the tax, including by misclassifying customs documentation and by bribing government officials, the Treasury said.
Complicit U.S. companies, meanwhile, leverage their relationships with major refineries and fuel distributors at home to purchase fuel and then divert it using networks of U.S. and Mexican front and shell companies, it said.
Mexico is a major crude oil producer, but it imports these fuels because its ageing refineries cannot meet local demand.
Once in Mexico, the Treasury said the fuel smuggled from the U.S. is sold through cartel-controlled petrol stations and unregulated roadside fuel stops at a steep profit.
Complicit U.S. fuel distributors obscure their proceeds through money laundering — purchasing luxury goods, real estate, and investment assets, the Treasury added.
It also issued new guidance to help banks and other financial institutions identify red flags in the cross-border fuel trade.
Those sanctioned on Tuesday include Oscar Juraidini and seven companies he owns or controls — Centro Cambiario La Peseta, OJ Living Trust, RK Real King, Soma Transporte y Servicios, Ogui Fletes, OF Transportes, and UK-based Cucumber Sweet Waves — all designated for acting on behalf of CJNG.
Also sanctioned were J. Refugio Ruiz and his two logistics companies, Jomadi Logistics & Cargo and Ahavat Logistics Solution, for providing material support to the cartel.
Jomadi Logistics & Cargo, Soma Transporte y Servicios, OF Transportes and Centro Cambiario La Peseta did not respond to requests for comment. Juraidini and Ruiz as well as the other companies could not be reached for comment as no online presence or contact information could be found.
(Reporting by Stefanie Eschenbacher and Stephen Eisenhammer; Editing by Neil Fullick)
