HomeNewsCJNG Reaps Revenues From Tourist Real Estate Scam in Mexico

CJNG Reaps Revenues From Tourist Real Estate Scam in Mexico


A new slate of sanctions against businesses and individuals involved in a timeshare scam in Puerto Vallarta, Mexico, demonstrates how drug trafficking organizations like the CJNG use unsuspecting tourists as one more source of illicit income. 

The US Department of the Treasury’s Office of Foreign Assets Control (OFAC) has sanctioned seven individuals and 19 Mexican companies believed to be involved in timeshare fraud led by the Jalisco Cartel New Generation (Cartel Jalisco Nueva Generación - CJNG) in Puerto Vallarta, a major tourist destination in on Mexico’s Pacific coast. OFAC sanctioned eight other Mexican companies that were linked to the same network in March.  

The fraudsters allegedly made unsolicited offers to purchase timeshare properties. Once the owners agreed to sell, the fraudsters requested advance payments that they said would cover fees and taxes and would expedite the sale. Once the owners paid, the scammers disappeared, leaving the victims with no buyer and no money, according to a Treasury Department press release. 

SEE ALSO: Booming Mexico Resort Town of Puerto Vallarta is Hostage to CJNG

In another scheme, real estate companies sold units in timeshare developments that were never built, either because the companies simply vanished or because the projects were purposefully planned in protected natural areas and subsequently canceled, a government official working in security matters who did not want to be identified for security reasons, told InSight Crime. The money was never refunded. 

This type of timeshare fraud often targets people looking for retirement or vacation properties abroad and helps the CJNG generate revenue beyond its traditional drug trafficking activities. 

“They take advantage of the fact that these are usually older people who tend to be trusting and do not follow basic security measures such as asking for references or checking public information about the property,” said the source.  

The CJNG also utilized frontmen, people who received payments for using their official ID, or nominees to register the companies carrying out scams, according to documents obtained by VICE. In some cases, these nominees may have been deceased or unaware that their identity was used for criminal activities. 

InSight Crime Analysis

The CJNG’s involvement in the timeshare scheme is only the tip of the iceberg concerning their involvement in businesses across the tourism sector in Puerto Vallarta, which has been a goldmine for the group for years.  

Hotels, bars, restaurants, and now timeshares are particularly attractive since they provide access to a range of other criminal activities, including money laundering, human trafficking, and drug trafficking, explained the source consulted by InSight Crime.

While the most recent sanctions target a scam operation, drug trafficking organizations are frequently involved in real construction projects to launder money. As a high-traffic tourist area, constructing housing developments or residential complexes in Puerto Vallarta offers criminal groups a sound way to launder investments, said the source.

Criminal groups use frontmen or front companies to make large purchase orders for building materials or finance the construction of properties with dirty money. The cost of a beachfront apartment is high, meaning it is an easy way to legitimize large sums of ill-gotten cash.  

SEE ALSO: Los Cuinis May Have Laundered Money Through Argentina, Uruguay

The restaurant sector is also crucial to the CJNG’s activities, as restaurants are used as a place of exchange for drug shipments and sales. However, restaurants can also become epicenters of violence and attract the attention of local authorities. For instance, in 2016, two sons of Joaquín Guzmán Loera’s, alias 'El Chapo,' were kidnapped -- and subsequently released -- in an upscale restaurant in Puerto Vallarta, allegedly on orders from Nemesio Oseguera Cervantes, alias 'El Mencho,” leader of the CJNG. Additionally, the former governor Aristóteles Sandoval was assassinated at a restaurant in Puerto Vallarta in 2020. The CJNG was linked to his murder. 

Despite the various criminal economies within the tourism sector in Puerto Vallarta, the effectiveness of both international sanctions and seizures of properties by local authorities is questionable. US sanctions will have little impact on the criminal operation but will make accessing the US banking system much more difficult for the accused companies. Seizures made at the local level, "represent minimal damage" to the organization, said the source. “For every ten businesses they target, they have 100 operating, so it's not very significant.”  

The Cuinis, a once-powerful money-laundering wing of the CJNG, used the real estate sector in Puerto Vallarta and other Jalisco beach resorts to launder their drug money for years. The sanctioning of 15 businesses and six individuals linked to the gang by the US Treasury Department in 2015 has done little to curb the CJNG’s use of the tourism sector for money laundering and profiteering. 

share icon icon icon

Was this content helpful?

We want to sustain Latin America’s largest organized crime database, but in order to do so, we need resources.


What are your thoughts? Click here to send InSight Crime your comments.

We encourage readers to copy and distribute our work for non-commercial purposes, with attribution to InSight Crime in the byline and links to the original at both the top and bottom of the article. Check the Creative Commons website for more details of how to share our work, and please send us an email if you use an article.

Was this content helpful?

We want to sustain Latin America’s largest organized crime database, but in order to do so, we need resources.


Related Content


Police in Guanajuato, Mexico, are accused of being in the pocket of the Jalisco Cartel. But do they have a…

BARRIO 18 / 14 SEP 2022

In the mountains of Michoacán, Mexico, Carlos was trained to become a ruthless soldier for the Cárteles Unidos.


It was so simple once. The Gulf Cartel and its ancestors maintained control of Tamaulipas for eight decades.

About InSight Crime


Open Position: Social Media and Engagement Strategist

27 MAY 2023

InSight Crime is looking for a Social Media and Engagement Strategist who will be focused on maintaining and improving InSight Crime’s reputation and interaction with its audiences through publishing activities…


Venezuela Coverage Receives Great Reception

27 MAY 2023

Several of InSight Crime’s most recent articles about Venezuela have been well received by regional media. Our article on Venezuela’s colectivos expanding beyond their political role to control access to…


InSight Crime's Chemical Precursor Report Continues

19 MAY 2023

For the second week in a row, our investigation into the flow of precursor chemicals for the manufacture of synthetic drugs in Mexico has been cited by multiple regional media…


InSight Crime’s Chemical Precursor Report Widely Cited


We are proud to see that our recently published investigation into the supply chain of chemical precursors feeding Mexico’s synthetic drug production has been warmly received.


InSight Crime’s Paraguay Election Coverage Draws Attention 

5 MAY 2023

InSight Crime looked at the various anti-organized crime policies proposed by the candidates in Paraguay’s presidential election, which was won on April 30 by Santiago Peña. Our pre-election coverage was cited…