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Report: Billions in illicit cash laundered through Mexican financial system with impunity

March 5, 2017  |  Posted by: JammedUp Staff
Report: Billions in illicit cash laundered through Mexican financial system with impunity

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“Billions of dollars” in launder money resulting from criminal activities is perpetrated with “relative impunity” in the Mexican financial system, the U.S. Foreign Ministry said Thursday.

In 2016, only 20 percent of the cases registered – one in five investigations on money laundering – were punished due to “lack of judicial capacity, corruption, and clumsiness of the Mexican laws on alienation of property, Proceso reported.

“The number of prosecutions of money laundering cases remains minimal considering the volume of illicit finance in Mexico, and have actually declined in recent years,” the State Department lamented in its 2017 report on money laundering released on Thursday, along with the report on the Strategy for Narcotics Control.

The report emphasizes the rampant corruption in the judicial system, which “hampers the Mexican government’s ability to condemn organizations or individuals involved in money laundering.”

The report reiterated the illicit money washed through the Mexican financial system comes mostly from drug trafficking, arms, corruption, kidnapping, Extortion, and theft of fuel.

The real estate, corporate or luxury sectors remain an effective means for criminal actors to launder money derived from their illicit activities, the report indicated.

Other methods, the report added, involves depositing relatively small sums of cash in U.S. banking institutions for later withdrawal Mexico, or utilizing covert black market peso exchange houses.

According to the State Department, Mexican cartels have a presence not only in the United States, Central, and South America but also in Europe – where they use, for example, ports in Italy to repatriate the money from the sale of drugs – in China or the Philippines.

Chinese authorities have reported numerous operations of Mexican cartels to stockpile chemical precursors, the State Department said.

The report detailed that between 2007 and 2014 Mexico imported about 300 tons of aluminum chloride, while in 2015 these imports shot up 50 times and reached 15 thousand tons (Aluminum chloride, is used in the production of heroin and methamphetamine).

Mexican cartels increasingly rely on the chemical precursor phenyl-2-propanone to make methamphetamine, thereby avoiding the risks and costs of importing massive amounts of pseudoephedrine from China, the State Dept. said.

The US agency stated that the new method of Mexican cartels to manufacture methamphetamine has been so efficient, the criminal organizations have exported the process to Africa.

The report also noted that in March 2016, the Nigerian authorities dismantled an “industrial-size” methamphetamine laboratory. Four Mexican nationals and seven Nigerians were arrested in the raid.

Officials said the massive  meth lab was capable of producing 4,000 of producing up to 4,000 kilograms of the drug per cooking cycle

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