Trump Administration Makes First Round Of Cartel Foreign Terrorist Organization Designations With Focus On Mexico And Venezuela

The US State Department has made its first round of designations pursuant to Executive Order 14157, "Designating Cartels and Other Organizations as Foreign Terrorist Organizations and Specially Designated Global Terrorists," identifying eight international cartels and transnational organizations as Foreign Terrorist Organizations (FTOs) and Specially Designated Global Terrorists (SDGTs).

As Bracewell discussed earlier this month, these designations create criminal exposure for any entity — US or foreign — determined to have provided "material support" to one of these organizations. An entity may be found liable for providing "material support" to one of these organizations if it provides any property (tangible or intangible) or services, including currency, financial services, lodging, personnel and transportation.

To avoid unwittingly doing business with or providing material support to these newly designated FTOs and SGDTs, it is imperative that companies conduct renewed due diligence on their counterparties and supply chains, and reassess their anti-corruption controls and compliance measures.

The newly designated FTOs and SDGTs, and their leadership as alleged by US law enforcement, include:

• Tren de Aragua (TdA). Key leadership includes: Hector Rusthenford Guerrero Flores, a/k/a "Niño Guerrero," ¹ Yohan Jose Romero, a/k/a "Johan Petrica,"² and Giovanny San Vicente, a/k/a "Giovanni."³
• La Mara Salvatrucha (MS-13). Key leadership includes: Edenilson Velasquez Larin, a/k/a "Agresor," "Saturno," "Tiny," "Erick," and "Paco;" andHugo Diaz Amaya, a/k/a "21" and "Splinter."⁴
• Cártel de Sinaloa. Key leadership includes: Ismael Zambada-Garcia, a/k/a "El Mayo," and Joaquin Guzman Lopez, son of "El Chapo" Guzman.⁵
• Cártel de Jalisco Nueva Generación (CJNG). Key leadership includes: Nemesio Rubén Oseguera Cervantes, a/k/a "El Mencho."⁶
• Cártel del Noreste (CDN). Key leadership includes: Juan Gerardo Trevino-Chavez, a/k/a "Huevo."⁷
• La Nueva Familia Michoacana (LNFM). Key leadership includes: Johnny Hurtado Olascoaga, a/k/a "El Pez," and Jose Alfredo Hurtado Olascoaga, a/k/a "El Fresa."⁸
• Cártel del Golfo (CDG). Key leadership includes: Jose Alfredo Cardenas-Martinez, a/k/a "El Contador."⁹
• Cártel Unidos (CU).

In addition to international cartels that operate primarily in Mexico, this list includes two transnational organizations mentioned specifically in E.O. 14157: TdA, which originated in Venezuela but is also active in parts of South America, including Chile, Colombia and Peru; and MS-13, which originated in Los Angeles but is also active in Mexico and parts of Central America, including El Salvador, Guatemala and Honduras.

Companies conducting business in the countries listed above should beware of the organizations' infiltration of legitimate industries. La Nueva Familia Michoacana and Cártel Unidos, for example, are heavily involved in the agricultural landscape of Michoacán, Mexico, particularly in the production of avocados. US law enforcement alleges that the Cártel de Jalisco Nueva Generación ran an elaborate time share fraud scheme that targeted US owners of time shares in Mexico.¹⁰ Many cartels also operate legitimate businesses in order to launder money.

For more information, see "Guiding Your Company Through Trump's New Latin America Enforcement Policy" or reach out to Bracewell's government enforcement and investigations team for guidance.

Footnotes

1. https://www.state.gov/reward-for-information-hector-rusthenford-guerrero-flores

2. https://www.state.gov/reward-for-information-yohan-jose-romero/

3. https://www.state.gov/reward-for-information-giovanny-san-vicente/

4. https://www.justice.gov/usao-edny/pr/two-national-ms-13-gang-leaders-and-other-ms-13-members-and-associates-indicted

5. https://www.ice.gov/about-ice/hsi/news/hsi-insider/notorious-sinaloa-cartel-leaders-arrested

6. https://www.state.gov/nemesio-ruben-oseguera-cervantes-el-mencho-2

7. https://www.ice.gov/news/releases/leader-cartel-del-noreste-arrested-following-ice-hsi-investigation

8. https://ofac.treasury.gov/media/929446/download?inline

9. https://www.ice.gov/news/releases/head-gulf-cartel-indicted-following-ice-hsi-federal-partner-assisted-investigation

10. https://home.treasury.gov/news/press-releases/jy2465

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.