Mexican Jalisco New Generation Cartel (CJNG)

According to Drug Enforcement Administration (DEA) authorities, global criminals, including rival drug-trafficking organizations or DTOs, are increasingly using the same networks of professional brokers to launder their proceeds.

The Mexican Jalisco New Generation Cartel (CJNG) has emerged as one of the most powerful and dangerous criminal organizations in the world. Because of its proclivity for violence, willingness to traffic all manner of narcotics, and ability to wash hundreds of millions of dollars in proceeds each year, the Jalisco New Generation Cartel (known as CJNG, based on the acronym for its Spanish-language name Cártel de Jalisco Nueva Generación), has grown into one of the world's most dangerous transnational groups and expanded its operations into most Mexican states and several large U.S. cities in nearly a decade.

CJNG has a strict command and control structure, employs extensive money-laundering tactics, controls some of Mexico's busiest and most important ports, and currently has a presence in at least 22 of the country's 32 states and continues to be led by founder Nemesio Oseguera Cervantes, alias "El Mencho." El Mencho is the DEA's most wanted fugitive, and the  US Department of Justice offers its greatest reward ($10 million) for information leading to his capture.

CJNG has key distribution centers in Los Angeles, New York, Chicago, Houston, and Atlanta, as well as a rising presence along the Southwest border and operations in many smaller cities and towns around the country. This is why it has become a significant priority for US Law Enforcement.

Who is the Founder of CJNG?

Nemesio Oseguera Cervantes, or "El Mencho," is the undisputed leader of the CJNG. Under his leadership, the cartel has grown exponentially, both in terms of its operational capabilities and its geographical reach. El Mencho's strategic acumen and ruthless approach have been instrumental in the CJNG's rise to power. Other key figures in the organization include Erick Valencia Salazar, also known as "El 85," and Abigael González Valencia, leader of the allied Los Cuinis organization.

History and Evolution of CJNG

The history of the Jalisco New Generation Cartel (CJNG) is a tale of rapid ascension, strategic maneuvering, and relentless expansion. From its inception in 2010 to its current status as one of the most powerful criminal organizations in the world, the CJNG's journey is marked by significant milestones and key events that have shaped its evolution.

Early Beginnings and Formation

The CJNG was born out of the turmoil following the death of Ignacio "Nacho" Coronel, a high-ranking member of the Sinaloa Cartel, in July 2010. Coronel's death created a power vacuum within the Sinaloa Cartel, leading to internal strife and the eventual splintering of factions. Nemesio Oseguera Cervantes, known as "El Mencho," seized this opportunity to establish a new cartel, bringing together loyalists and former associates to form the CJNG.

Initially, the CJNG focused on consolidating power within the state of Jalisco. The cartel quickly gained a reputation for its brutal enforcement tactics, including public displays of violence intended to intimidate rivals and assert dominance. This period of consolidation was crucial for the CJNG, as it laid the groundwork for future expansion.

Major Milestones and Growth Over the Years

2011-2012: Expansion and Consolidation

During these years, the CJNG began to expand its influence beyond Jalisco, targeting neighboring states such as Colima, Michoacán, and Guanajuato. The cartel's aggressive tactics and strategic alliances allowed it to rapidly gain control over key drug trafficking routes and territories.

2013-2015: National Recognition and Infamy

The CJNG's notoriety grew as it engaged in high-profile acts of violence and confrontation with Mexican authorities. In 2015, the cartel made headlines with the downing of a Mexican military helicopter, an unprecedented act that underscored its growing power and audacity. This period also saw the CJNG's involvement in various criminal enterprises, including drug trafficking, extortion, and money laundering.

2016-2018: International Expansion

The CJNG's ambitions extended beyond Mexico's borders, as it sought to establish a presence in international drug markets. The cartel forged alliances with criminal organizations in Central and South America, as well as in Europe and Asia. This global expansion allowed the CJNG to diversify its revenue streams and solidify its position as a major player in the international drug trade.

2019-Present: Continued Dominance and Challenges

In recent years, the CJNG has continued to expand its influence, despite facing increased pressure from Mexican and international law enforcement agencies. The cartel's ability to adapt and innovate has been key to its sustained dominance. However, the CJNG also faces significant challenges, including internal conflicts, rival cartels, and intensified government crackdowns.

CJNG's Organizational Structure

The CJNG is known for its highly organized and hierarchical structure, which has been crucial to its rapid rise and sustained dominance. 

Leadership Hierarchy

At the top of the CJNG is Nemesio Oseguera Cervantes, also known as "El Mencho." As the supreme leader, El Mencho holds ultimate authority over all cartel operations. His strategic vision and ruthless leadership have been instrumental in the CJNG's growth and expansion.

Key Members and Their Roles

Regional Commanders

Regional commanders manage the CJNG's activities in specific geographic areas, overseeing local operations such as drug trafficking and enforcement. They report directly to El Mencho and play a crucial role in strategic decision-making.

Financial Operatives

Financial operatives handle the cartel's finances, including money laundering and investments in legitimate businesses. They ensure a steady flow of funds to support the CJNG's activities.

Enforcement Units

Enforcement units, or "sicarios," are responsible for carrying out acts of violence and intimidation. These highly trained operatives maintain the cartel's control over territories and eliminate rivals.

Logistics and Supply Chain Managers

Logistics managers oversee the transportation and distribution of drugs and other illicit goods, ensuring the smooth operation of the cartel's supply chain.

Intelligence and Surveillance Teams

Intelligence teams gather information on rivals, law enforcement activities, and potential threats. They use advanced technology to stay ahead of adversaries and avoid detection.

Legal and Political Operatives

Legal and political operatives work to corrupt officials, influence legal proceedings, and protect the cartel's interests within the political and judicial systems.

What Are the Criminal Activities of CJNG?

The CJNG is involved in a wide array of criminal activities that extend far beyond drug trafficking. These activities not only generate substantial revenue for the cartel but also contribute to its power and influence. 

Drug Trafficking Operations

Drug trafficking is the cornerstone of CJNG's criminal empire. The cartel is heavily involved in the production, transportation, and distribution of various narcotics, including methamphetamine, cocaine, heroin, and fentanyl. CJNG is particularly well-known for its prolific methamphetamine production and the importation of precursor chemicals from China and India. The cartel also hires scientists and expert chemists to create its own precursor chemicals, allowing it to expand into the manufacture and sale of fentanyl and heroin. The CJNG controls key drug trafficking routes within Mexico and has established extensive networks that reach into the United States, Europe, and Asia.

Money Laundering Schemes

To manage and conceal the vast amounts of money generated from its criminal activities, the CJNG engages in sophisticated money laundering schemes. These involve the use of front companies, real estate investments, and complex financial transactions to integrate illicit funds into the legitimate economy. The cartel's financial operatives employ advanced techniques to evade detection by authorities, ensuring a steady flow of clean money to support its operations.

Other Illicit Activities

Kidnapping and Extortion

The CJNG is notorious for its involvement in kidnapping and extortion, targeting individuals and businesses to demand ransom payments or protection money. These activities generate additional revenue and instill fear to maintain control over local populations.

Human Trafficking

The CJNG exploits vulnerable individuals for forced labor, sexual exploitation, and other forms of modern-day slavery, further underscoring its disregard for human life and dignity.

Arms Trafficking

The cartel engages in arms trafficking to equip its enforcement units with advanced weaponry, often acquiring military-grade equipment to bolster its firepower.

Cybercrime

In recent years, the CJNG has expanded into cybercrime, using technology for hacking, identity theft, and online fraud, providing additional revenue streams and enhancing its operational capabilities.

Areas of Operation

CJNG's aggressive growth strategy has resulted in high levels of bloodshed, notably in Ciudad Juarez and Tijuana, where it has competed with the Sinaloa cartel for control of the lucrative heroin trade and associated smuggling routes. The cartel has also been tied to many mass graves in southwestern Mexico and has demonstrated a propensity to engage in violent conflicts with Mexican security forces and other cartels. One of the most notable incidents was the shooting down of an army helicopter in 2015, marking the first successful takedown of a military asset of its kind in Mexico.

CJNG's efforts to control key ports on both the Pacific and Gulf Coasts have allowed it to centralize key components of the global narcotics supply chain. The cartel claims control over the ports of Veracruz, Manzanillo, and Lázaro Cardenas, providing access to precursor chemicals originating in China and other regions of Latin America. This strategic control has enabled CJNG to pursue an aggressive growth plan, fueled by increased demand in the United States for Mexican methamphetamine, heroin, and fentanyl.

How CJNG Moves and Launders Illicit Proceeds

Drug cartels used to dominate the whole drug production, transportation, distribution, and laundering process for their drug proceeds for decades. Current Mexican DTOs, notably CJNG, are more willing to rely on foreign money brokers that participate in a combination of trade-based money laundering and black market peso exchange and are not tied to any one organization.

These brokers make money by arranging currency transactions between drug groups and businesses seeking to purchase money at a lower cost. Territorial battles between DTOs for control of a container terminal in Mexico or ports of entry along the US-Mexico border are common, but when it comes to money laundering, it is not uncommon to find a money broker moving illicit proceeds for the Sinaloa cartel in one transaction and then CJNG in the next, or a DTO working with a Hebrew money laundering organization in one transaction and an Arab network in the next.

Authorities' Efforts to Combat the Mexican Cartel CJNG

In 2020, Mexico's Financial Intelligence Unit, a branch of the finance ministry responsible for detecting and preventing money laundering, said that it had requested that roughly 2,000 accounts reportedly tied to the violent Jalisco New Generation Cartel be frozen.

According to the report, Mexican officials worked with the DEA to discover "a considerable number of members of this criminal organization, as well as its main financial operators and firms utilized in money laundering."

In February 2021, Sanchez-Rios, the former owner and operator of a Martinsville business that was used to launder more than $4.3 million in proceeds for CJNG, was sentenced to 96 months in federal prison by U.S. District Court.

Sanchez-Rios and 12 other members of CJNG were accused in March 2019 of federal narcotics trafficking and money laundering allegations. Sanchez-Rios pled guilty in June 2020 to conspiracy to commit money laundering and managing a business that transferred illegally obtained funds.

In October 2021, Under the Foreign Narcotics Kingpin Designation Act, OFAC imposed sanctions on four CJNG members for narcotics trafficking. The Act aims to prevent important international drug traffickers, their organizations, and agents from entering the US financial system and to stop any commerce and transactions between the traffickers and US corporations and individuals.

CJNG's leader, Nemesio Oseguera Cervantes' daughter, pled guilty to financial interactions with identified Mexican entities in March 2021. She was sentenced to 30 months in jail in June 2021. His son was arrested in 2015 and appeared in court in February 2020 on narcotics trafficking charges in Washington, D.C

AML Obligations

The Money Laundering, Terrorist Financing, and Transfer of Fund (Information on the Payer) Regulations apply to you if you are a bank or building society or if your firm engages in certain financial activities (such as investment managers or firms, e-money institutions, payment institutions, consumer credit firms, and others).

This implies that the FCA expects you to implement risk-based customer due diligence measures and take additional precautions to keep your services from being used for money laundering. Internal controls must also efficiently monitor and manage your company's compliance with anti-money laundering policies and procedures.

Fortunately, Sanction Scanner's AML service can help. It provides a comprehensive spectrum of risk-level checking services with exceptional match rates, AML - know your customer (KYC) solutions, enhanced due diligence, and much more. It's a quick, secure, and affordable way to confirm that you're adhering to your requirements and approaching AML from a risk-based approach.

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