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Harry Cassin
Publisher and Editor

Andy Spalding
Senior Editor

Jessica Tillipman
Senior Editor

Bill Steinman
Senior Editor

Richard L. Cassin
Editor at Large

Elizabeth K. Spahn
Editor Emeritus

Cody Worthington
Contributing Editor

Julie DiMauro
Contributing Editor

Thomas Fox
Contributing Editor

Marc Alain Bohn
Contributing Editor

Bill Waite
Contributing Editor

Shruti J. Shah
Contributing Editor

Russell A. Stamets
Contributing Editor

Richard Bistrong
Contributing Editor

Eric Carlson
Contributing Editor

How a Financial Intelligence Unit is trailblazing anti-corruption enforcement

A central topic to the investigation and prosecution of corruption is the criminal offense of money laundering. In the past years, the intergovernmental Financial Action Task Force or FATFA has noted that Mexico has an adequate system to tackle money laundering and terrorist financing, but should step up efforts in pursuing launderers and confiscating their assets.

Mexico’s Financial Intelligence Unit (FIU), part of the finance ministry tasked with combating and preventing money laundering, has a new proactive enforcement policy. In stark contrast to the past, the FIU has been unusually active investigating and freezing accounts related to corruption investigations.

The FIU is poised to play a central role in enforcement by actively freezing bank accounts, conducting investigations and providing information to prosecutors in cases whenever there is presumption of a violation of law, as already hinted by  the first major cases targeted by Mexico’s General Prosecutor (FGR), such as the action against the former head of the national oil company PEMEX, and the chairman of Altos Hornos de México, among other cases.

From December 2018 to August 2019, a total of 129 blocking actions were brought, involving 601 individuals for the aggregate amount of $38.4 million. The accounts blocked involved 845 related third parties for the aggregate amount of $4 million.

The 2019 National Risk Evaluation Report produced by the FIU indicates an even bigger role for the agency, more budget for monitoring of suspicious activities, better institutional coordination protocols, execution of coordination agreements with state governments, and overall a new proactive policy to detect criminal activity.

This level of enforcement is a departure from the discrete and limited role the UIF had played and one that may require legal reforms to enable a solid legal framework for its execution and to avoid friction with prosecuting authorities such as the FGR.

The energetic head of the FIU has said it would be desirable for the FIU to have a permanent seat as a member of the National Anti-corruption System Executive Committee, and for the FIU to have greater autonomy and resources to conduct investigations and initiate investigations in coordination with the General Prosecutor.

FATFA said about Mexico: “Corruption is a source of illicit proceeds, and an enabler of [money laundering]  and its predicate offenses.” Against this backdrop, Mexico’s FIU is expected to continue to spearhead anti-money laundering and therefore anti-corruption investigations and enforcement at an unprecedented pace.

The activity of the Financial Intelligence Unit, albeit sometimes controversial, is a key to understanding the wave of investigations and enforcement activity that is already sweeping across Mexico.

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