The United States has imposed sanctions on three Mexican financial institutions, accusing them of laundering millions of dollars for drug cartels and facilitating payments for fentanyl precursor chemicals from China, in the latest escalation of Washington's anti-narcotics campaign.

The Treasury Department's Financial Crimes Enforcement Network (FinCEN) declared CIBanco, Intercam Banco, and Vector Casa de Bolsa as "primary money laundering concerns" on June 25, marking the first actions under the new Fentanyl Sanctions Act and FEND Off Fentanyl Act, reported Reuters.

The move has sparked a diplomatic response from Mexico, with President Claudia Sheinbaum rejecting the allegations and demanding concrete evidence from Washington.

"If there is no evidence, there will be no recognition of money laundering from our side," Sheinbaum told reporters at her morning press conference. "We act if there is evidence. The Treasury Department should send the evidence if it has it so that we can accompany them in the process."

Targeting the financial pipeline

The sanctions prohibit certain US transactions with the three Mexican institutions, effectively cutting them off from the American financial system - a move experts describe as potentially devastating for the targeted firms.

"This is a bold move. Being cut off from the US financial system is a death blow. It's enormously impactful," Vanda Felbab-Brown, a senior fellow at the Brookings Institution specialising in organised crime, told Reuters.

The Treasury alleges that the three institutions "have collectively played a longstanding and vital role in laundering millions of dollars on behalf of Mexico-based cartels and facilitating payments for the procurement of precursor chemicals needed to produce fentanyl."

While CIBanco and Intercam are relatively small commercial banks with assets of $7bn and $4bn respectively, Vector Casa de Bolsa manages nearly $11bn in assets and ranks among Mexico's top 10 securities brokers, reported Reuters.

Mexican response and investigation

Mexico's Finance Ministry confirmed it had been notified of the FinCEN investigation and had requested evidence of illicit activities from the US Treasury, but received no "conclusive information," according to Reuters.

Sheinbaum emphasised that the transfers in question involved legally constituted Chinese companies operating in Mexico for years, part of $139bn in bilateral trade. "These are transfers like thousands of transfers made every day between Chinese companies and Mexican companies," she said, as reported by Bloomberg Línea.

The Mexican president noted that the country's National Banking and Securities Commission (CNBV) and Financial Intelligence Unit (UIF) have opened investigations into the three institutions following the US notification.

All three sanctioned institutions have categorically denied the allegations. "Vector categorically rejects any accusation that compromises its institutional integrity," the brokerage said in a statement to Reuters, while CIBanco stated it "has no involvement in illegal activities."

On June 26, Mexico’s Banking and Securities Commission declared the temporary management intervention of CIBanco and Intercam, to "prevent a possible run on deposits" and protect creditors and depositors, as reported by the Wall Street Journal.

Broader anti-fentanyl campaign

The sanctions represent the latest phase in Washington's intensified campaign against fentanyl trafficking, which kills tens of thousands of Americans annually. The Treasury Department has recently frozen assets of major cartel leaders, including Nemesio Oseguera Cervantes ("El Mencho") of the Jalisco New Generation Cartel.

According to El País, the sanctions also coincide with broader US-Mexico trade tensions, as US President Donald Trump has imposed 25% punitive tariffs on many Mexican imports aimed at spurring action to halt fentanyl flows.

The Treasury specifically accused Vector Casa de Bolsa of participating in transactions involving bribes paid by the Sinaloa Cartel to former Mexican security chief Genaro García Luna, who was sentenced to 38 years in prison for aiding the criminal organisation, reported Bloomberg Línea.

Expert analysis

Cecilia Farfán-Méndez, head of the North America Observatory at the Global Initiative Against Transnational Organized Crime, told El País that while the sanctions are not unprecedented, their fentanyl context is significant.

"What they are saying is that they will not let go of the fentanyl issue, that they will attack it from all fronts," she said.

However, former Mexican intelligence chief Guillermo Valdés cautioned that many companies may unknowingly facilitate cartel finances. "These accusations do not imply intentionality on the part of the companies indicated," he told El País, while acknowledging the sanctions send "a great political message."

The latest diplomatic friction highlights the complex challenge of combating fentanyl trafficking while maintaining the close economic relationship between the neighbouring countries, with financial cooperation remaining crucial despite the current tensions.