Senior US law enforcement officials have argued a pair of drug traffickers opted to launder money through Citigroup as they considered the bank’s fraud controls “more favourable”.
US prosecutors claim two California men, with alleged ties to Mexico’s infamous Sinaloa cartel, deposited nearly $36,000 at Citi ATMs in January 2021, according to an indictment unsealed last week.
They are alleged to have fed a few hundred dollars at a time into the machines, waiting a short time between each transaction, thereby remaining below the $10,000 limit at which banks are required to report cash transactions to the US Treasury.
The two men – Guillermo Zambrano and Luis Belandria-Contreras – are alleged to be part of a major criminal network that cleaned at least $50m from the sale of fentanyl and meth in the US.
Drug Enforcement Administration officials told the Financial Times that the duo had scoped out several banks before choosing Citi.
“There are banks that pay less attention than others,” a senior official said. Another added: “They figure out the places that are more favourable to them.”
The official argued that while the individual transactions were not subject to any reporting requirements, the pattern of the deposits should have raised suspicion.
Both men have pleaded not guilty. A lawyer for Zambrano said he intended to “pursue a duress defence” and that his client was in debt and threatened with kidnapping by a cartel member. A lawyer for Belandria-Contreras did not respond to a request for comment.
Citi declined to comment on the individual case, citing secrecy requirements, but said it had “robust anti-money laundering policies”.
“When we find evidence of such activity, we notify the authorities as required and fully cooperate with any investigation through appropriate legal processes,” the bank added.
Law enforcement officials have warned that Mexican drug traffickers are becoming increasingly sophisticated with their money laundering techniques, including striking arrangements with Chinese nationals in the US.
In 2012, HSBC agreed to a $1.9bn (£1.2bn) fine, the largest ever of its kind, to avoid prosecution from US authorities after a Senate investigation found it had been a conduit for “drug kingpins and rogue nations”.
Most notably, it was revealed that more than $881m was laundered through HSBC accounts for Colombia’s Norte del Valle and Mexico’s Sinaloa drug cartels, the latter then being led by El Chapo.