Treasury cracks down on money laundering tied to drug cartels

The Treasury Department took steps Thursday to shut down an international money laundering operation utilized by Mexican and Colombian drug cartels.

The Treasury's Office of Foreign Assets Control (OFAC) announced that it was designating two men — Jorge Fadlallah Cheaitelly and Mohamed Zouheir El Khansa — as "specially designated narcotics traffickers" because they played a "significant role" in laundering drug trafficking proceeds.

In addition, OFAC designated nine other individuals, as well as 28 entities in South America and Hong Kong with ties to the two men, who are Lebanese-Colombian nationals. Such designations prohibit U.S. citizens from doing business with the identified people or entities, and also freezes any assets that might fall under U.S. jurisdiction.

"Jorge Fadlallah Cheaitelly runs an extensive money laundering network based in Panama and Colombia with ties to Mexico, Lebanon, and Hong Kong,” said OFAC Director Adam J. Szubin. “By designating these individuals and companies we are exposing a significant international money laundering network, forcing them out of the international financial system, and undermining their ability to launder drug money through a global support network for the Mexican and Colombian drug cartels.”

The Treasury detailed an extensive global operation spanning the Western Hemisphere, the Middle East and Hong Kong, including several money exchanges in numerous countries as well as multiple front companies based in Colombia that exist to help launder illicit proceeds.

The designations were achieved under the Kingpin Act, signed into law at the end of 1999. Since 2000, the Treasury has designated more than 1,000 individuals and entities for their ties to major drug traffickers.

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