FinCEN Uses “Special Measures” To Combat Fentanyl Money Laundering, Raising Concerns Around Targeted Mexican Financial Institutions

Key Takeaways

• The Financial Crimes Enforcement Network aims to combat the fentanyl crisis by acting on the 2024 Fentanyl Sanctions Act and the FEND Off Fentanyl Act, which grant the agency wide and previously untapped authority.
• Under a new “special measure,” FinCEN can intervene immediately if the secretary of the treasury identifies that a domestic financial institution’s “transmittals of funds” are linked to institutions or accounts flagged in connection with opioid trafficking.
• The orders become effective 21 days after their publication in the Federal Register, and FinCEN has issued a series of FAQs to assist with compliance.
• Financial institutions and their compliance teams must rapidly adapt to the evolving AML/CFT and sanctions landscape and monitor FinCEN releases and enforcement actions and ensure that all entities with which they interact are screened against internal watchlists and transaction monitoring systems.

The U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) took a historic step in combating the fentanyl crisis on June 25, 2025, by exercising, for the first time, the expansive authorities granted under the 2024 Fentanyl Sanctions Act and the FEND Off Fentanyl Act (2024 Fentanyl Acts). Through this unprecedented action, FinCEN has designated three Mexican financial institutions as entities “of primary money laundering concern in connection with illicit opioid trafficking” and prohibited the transmission of funds to the three institutions—and their subsidiaries, branches, and offices in Mexico—due to their direct links to opioid trafficking and the facilitation of related transactions. The three Mexican financial institutions are:

• CIBanco S.A., Institution de Banca Multiple (CIBanco)[1]
• Intercam Banco S.A., Institucion de Banca Multiple (Intercam)
• Vector Casa de Bolsa, S.A. de C.V. (Vector)

Given that these are the first designations under the 2024 Fentanyl Acts, many questions persist as to FinCEN’s expectations for how U.S. institutions will implement these new requirements. In addition, the acts expand the impact of these designations beyond the financial institutions traditionally covered under other similar restrictions to require implementation by a broader group of institutions, including money services businesses and casinos, among others.

In imposing the designations, FinCEN indicated that CIBanco, Intercam, and Vector were determined to have played vital roles in facilitating money laundering activities of Mexico-based cartels engaging in illicit opioid trafficking, including facilitating payments for the procurement of precursor chemicals essential for the production of illicit opioids by drug trafficking organizations. For example, FinCEN found that Vector facilitated transactions related to the procurement of precursor chemicals from China for the Sinaloa and Gulf Cartels and provided a platform for laundering the proceeds of drug sales on a large scale. FinCEN’s orders prohibit all U.S. financial institutions from participating in any fund transfers—whether in traditional currency or convertible virtual currency—to or from accounts managed by, or for the benefit of, the three designated Mexican entities with proven ties to fentanyl trafficking.

Below, we break down FinCEN’s “special measures” and their implications for the financial institutions that must implement these new restrictions.

Legal Authority and Special Measures Explained

At the core of this action is a new sixth “special measure” authorized by 21 U.S.C. § 2313a(a)(2). This measure is added to previous special measure authorities—such as those found in Section 311 of the USA PATRIOT Act—and empowers FinCEN to act swiftly and with broad scope. Specifically, the 2024 Fentanyl Acts include a new “Special Measure Six” that enables the secretary of the treasury to prohibit or impose stringent conditions on any domestic financial institution’s “transmittals of funds” (including the sending or receiving of funds, whether in traditional or virtual currency). If such funds are traced to institutions or accounts designated as being of “primary money laundering concern in connection with illicit opioid trafficking,” FinCEN can intervene immediately.

A key innovation under the 2024 Fentanyl Acts is FinCEN’s ability to impose these prohibitions or conditions immediately via order—bypassing the longer notice-and-comment period required under Section 311. Additionally, under Section 311, the most widely used special measure was “Special Measure Five,” which prohibited covered financial institutions from opening and maintaining correspondent accounts in the United States and established that due diligence must include notifying all correspondent accountholders that correspondent accounts may not be used to provide targeted institutions with access to the covered financial institution. However, this provision only applied to banks, broker-dealers, mutual funds, and futures commission merchants and introducing brokers in commodities. The reach of these measures extends beyond these four types of covered financial institutions, encompassing all entities falling under the broad federal definition of “financial institution,” including money services businesses, casinos, virtual asset providers, and more.

Real-World Impact: Scope of Current Action

The orders become effective 21 days after they are published in the Federal Register. 

FinCEN issued a series of FAQs to assist with compliance and indicates that by the effective date, covered financial institutions should (1) cease any and all transmittals of funds from or to CIBanco, Intercam, or Vector, as defined in the orders and (2) consider the finding of primary money laundering concern regarding CIBanco, Intercam, and Vector when complying with their other Bank Secrecy Act obligations, including any appliable obligations to establish and maintain anti-money laundering and countering the financing of terrorism (AML/CFT) compliance programs. This would also include AML/CFT internal controls, including risk assessment and suspicious activity reporting processes. FinCEN recommends that covered financial institutions continue to implement appropriate AML/CFT procedures and systems, including traditional compliance screening to identify customers and determine their involvement in a transmittal of funds involving CIBanco, Intercam, or Vector.

FinCEN also recommends that covered financial institutions continue to implement appropriate AML/CFT procedures and systems, including traditional compliance screening to identify customers and determine their involvement in a transmittal of funds involving these Mexican financial institutions.

The FinCEN FAQs also address suspicious activity report (SAR) filings, and they indicate that the orders do not impose a new SAR reporting obligation or otherwise alter existing SAR reporting obligations. However, consistent with existing SAR reporting obligations, covered financial institutions may consider, as warranted and appropriate, CIBanco, Intercam, and Vector’s identification as being of primary money laundering concern in connection with illicit opioid trafficking. FinCEN also indicates that if a SAR is filed on CIBanco, Intercam, or Vector’s transactional activity, in Field 2 (Filing Institution Note to FinCEN) of the SAR format, FinCEN requests that covered financial institutions enter “CIBanco2313a FIN-2025,” “Intercam2313a FIN-2025,” and “Vector2313a FIN-2025,” as appropriate.

Questions Raised 

In the wake of the recent FinCEN order, the financial industry faces a landscape filled with new and complex uncertainties. One prominent issue concerns FinCEN’s expectations around SARs. Although the order does not expressly require financial institutions to file SARs for transactions involving the named Mexican institutions, there is a growing sense within the industry that FinCEN may, in practice, expect such filings in connection with activities related to the sanctioned entities.

Similarly, since FinCEN did not use its Section 311 special measure authorities, there are no restrictions on maintaining correspondent accounts, which is typical with Section 311 actions, and no requirement to notify correspondent accountholders that correspondent accounts may not be used to provide these Mexican financial institutions with access to the covered financial institution. This raises questions as to whether correspondent account activities that do not involve transmittals of funds may continue. The growing sense within the industry is that FinCEN may, in practice, expect these correspondent account relationships to be terminated and financial institution due diligence and risk assessment processes to consider whether any of their correspondent accountholders may maintain relationships with these Mexican financial institutions and take steps to mitigate these risks.

The industry must consider the risks associated with transacting with foreign banks that are not themselves subject to the order but maintain correspondent accounts with the designated Mexican financial institutions. These interconnected relationships may require financial institutions to re-examine how they identify and manage indirect risk, both from their own customers and from global correspondent relationships. In this environment, the challenge of maintaining compliance while responding to evolving regulatory expectations has become more acute than ever.

Another area of uncertainty involves the geographic and legal scope of the order. While the prohibition on transmittals of funds is formally limited to the Mexican offices, subsidiaries, and branches of the listed institutions, there are obvious risks to engaging in transactions with any affiliates, subsidiaries, branches, or offices of these Mexican financial institutions operating outside of Mexico that financial institutions will need to carefully consider, as it may be difficult to determine whether funds are ultimately provided to a prohibited party.

The Path Forward

Financial institutions and their compliance teams must rapidly adapt to the evolving AML/CFT and sanctions landscape. Ongoing monitoring of FinCEN releases and enforcement actions is essential, and institutions should ensure that the designated entities are promptly screened against internal watchlists and transaction monitoring systems. Screening algorithms and interdiction controls should be updated to include not only the named institutions but also their affiliates, branches, and counterparties with potential ties to the Mexican financial institutions involved in opioid trafficking. Monitoring systems should not only screen for these Mexican financial institutions, but should also screen for their subsidiaries, branches, and offices both within and outside of Mexico.

There are significant legal, regulatory, and reputational risks associated with any business conducted—even indirectly—with the named Mexican financial institutions, their subsidiaries, or affiliated entities. These risks are further heightened when dealing with non-U.S. counterparties or intermediaries that may maintain correspondent relationships with the sanctioned Mexican institutions. Enhanced due diligence and transparency in correspondent banking relationships are essential.

Looking ahead, organizations should formalize written policies reflecting the prohibition on transmittals of funds to and from the sanctioned entities and enhance internal escalation procedures for any alerts relating to these parties. Regular compliance training should incorporate up-to-date examples from this FinCEN action, emphasizing the importance of reporting suspicious activities and the risks of indirect exposure. The regulatory landscape remains dynamic, and further designations and special measures are anticipated as FinCEN continues its campaign to disrupt the financial networks fueling fentanyl production and trafficking.

As a result of these orders, Mexico’s National Banking and Securities Commission (CNBV) promptly announced a temporary managerial intervention of these institutions that involves replacing their administrative and legal representatives to safeguard the interests of savers, customers, investors, and clients. We expect that there will be additional steps taken in Mexico, including possible legislative efforts, to address the deficiencies identified in these orders.

Endnote

[1] The CIBanco order indicates that CIBanco is a majority owner of two nondepository financial institutions, Finanmadrid Mexico, S.A. de C.V. and CI Fondos S.A. de C.V. These nondepository institutions are subsidiaries of CIBanco and are also covered by the FinCEN Order. The other two FinCEN orders (Intercam and Vector) did not specifically reference any subsidiary entities.