Treasury Sanctions Violent Cartel Linked to Timeshare Fraud Targeting Americans
The U.S. Treasury Department has sanctioned four Mexican individuals and 13 companies linked to the Cartel de Jalisco Nueva Generacion (CJNG), a violent Mexican cartel that is exploiting Americans through timeshare fraud schemes. The fraudulent activities primarily target older U.S. citizens in Puerto Vallarta, Mexico, draining their life savings. The Treasury Department warns that these criminals often use telemarketing scams, and the victims can suffer significant financial and emotional losses.
Treasury Secretary Scott Bessent emphasized the need to target drug cartels that are increasingly supplementing their drug trafficking proceeds with alternative revenue streams, including timeshare fraud. The sanctioned individuals and companies are involved in complex schemes, including timeshare exit scams, resale scams, and investment scams, where victims are asked to pay advance fees or taxes before receiving money, which rarely materializes. The cartel has been actively targeting American retirees, often through call centers in Mexico staffed by telemarketers fluent in English.
The Cartel de Jalisco Nueva Generacion is a U.S.-designated foreign terrorist organization, which has expanded its operations beyond drug trafficking into various revenue streams. The Treasury Department’s Office of Foreign Assets Control has taken significant measures to disrupt these cartels’ financial activities and protect U.S. citizens from falling victim to fraudulent schemes. The FBI and Treasury have issued warnings and collaborated to address the growing threat of timeshare scams operated by Mexican cartels.
According to the Treasury Department, the cartels often obtain information about U.S. timeshare owners from complicit insiders at timeshare resorts. After acquiring this information, the cartels use call centers in Mexico to contact victims by phone or email, pretending to be U.S.-based third-party timeshare brokers, attorneys, or sales representatives. The fraud may include timeshare exit scams, resale scams, and investment scams, where victims are asked to pay advance fees or taxes before receiving money, which rarely materializes.
In July 2024, the Treasury Department’s Financial Crimes Enforcement Network and the FBI issued a joint notice on the timeshare fraud associated with Mexico-based cartels and criminal organizations. In the six-month period following that notice, FinCEN received more than 250 suspicious activity reports, and filers reported approximately 1,300 transactions totaling $23.1 million, sent primarily from U.S. based individuals to counterparties in Mexico.
Based on FinCEN’s analysis, U.S. fraud victims sent an average of $28,912 and a median amount of $10,000 per transaction to the suspected scammers since July 2024. The FBI says approximately 6,000 U.S. victims reported losing nearly $300 million between 2019 and 2023 to timeshare fraud schemes in Mexico. However, officials believe that this figure likely underestimates the total losses, as many victims do not report the scam due to embarrassment or lack of awareness.
Treasury officials advise that those considering the purchase of a timeshare in Mexico should conduct appropriate due diligence. The Treasury Department has urged current U.S.-based owners of timeshares to also exercise caution, as the scams can result in long-term financial and emotional devastation. The warning highlights the ongoing threat posed by organized criminal groups leveraging the vulnerabilities of elderly Americans through deceitful schemes.