According to internal records obtained by La Policiaca, the Sinaloa Cartel laundered illcit funds in Mexico State, San Luis Potisi and Mexico City through shell companies nominally involved in construction scaffolding, bars and indoor soccer fields.
The documents, which come from the Financial Intelligence Unit of Mexico's Attorney General's Office, reveal that two of the cartel's main accountants, Jose Luis Laddaga Lopez and Pedro Alfonso Alatorre Damy, alias “El Piri” -- both of whom have since been arrested -- oversaw the laundering activities of these companies from 2004 to 2007. One of these included a popular bar in the city of Metepec, in Mexico State, which according to La Policiaca and Proceso was a popular destination for the state's political and economic elites.
Although these companies regularly reported thousands of dollars in losses and conducted major transactions in cash, it took three years before the companies attracted the attention of law enforcement officials.
InSight Crime Analysis
The case illustrates the importance of cracking down on the financial activity of Mexico's drug cartels. In October the country passed a long-awaited money laundering law which seeks to regulate cash transactions, a common laundering tool used by criminal organizations. Even still, there is reason to question whether it will be enough to tackle the scale of money laundering in the country. The wide range of companies used in the case demonstrates the difficulty of cracking down on the problem. With the Sinaloa Cartel and other major drug trafficking organizations regularly making billions of dollars in profits every year, tracing their financial investments is tricky business. Some officials in the country estimate that as much as $50 billion -- representing some three percent of the country's total economic output -- is laundered annually.
This activity is not limited to Mexico. While the United States Treasury has frozen the assets of druglords like Joaquin "Chapo" Guzman and his relatives in the country and prohibited US corporations from doing business with him, much of the Sinaloa Cartel's illicit proceeds continue to be laundered in the US southwest, especially in the state of Arizona. Considering the wide distriution network employed y cartels and the massive margin of profit from the drug trade, it is likely that this practice extends to elsewhere in the country as well.