Last week the United States Department of the Treasury Office of Foreign Assets Control (OFAC) designated a number of individuals as Specially Designated Nationals (SDNs) pursuant to the Foreign Narcotics Kingpin Designation Act (Kingpin Act) for their alleged narcotics trafficking activities.

The four designated individuals are all Mexican nationals whom OFAC believes are involved in the trafficking of cocaine and cash for the Sinaloa Cartel. According to the Treasury press release, the main target of this round of designations was Alfredo Vasquez Hernandez (a.k.a. Alfredo Compadre) who is believed to play a key role in Sinaloa Cartel leader, Chapo Guzman’s, drug trafficking and bulk cash smuggling operations.

Vasquez Hernandez was indicted by federal grand jury in the Northern District of Illinois on two counts of conspiring to traffic drugs in August 2009. The indictment charges Vasquez Hernandez with conspiring to import cocaine and heroin into the United States and describes him as the logistical coordinator of the importation of multi-ton quantities of cocaine from Mexico and South and Central American countries into the United States, and of deliveries of bulk currency from the United States to Mexico to Chapo Guzman. Vasquez Hernandez was arrested earlier this year. His extradition to the United States is currently pending.

While an OFAC SDN designation is sometimes only an administrative action, it is not uncommon for the designation to either coincide with or result from a federal criminal indictment. This is particularly true when looking at Kingpin Act designations. However, even if there is no public indictment returned against a designated party, there could still be a sealed indictment against a designated party which would not be publicly available. This is a frightening proposition for those parties as a sealed indictment in the U.S could be known to international law enforcement who could in turn arrest a designated party traveling through their country and extradite them to the U.S. if both countries are party to an extradition treaty. The moral of the story (other than to stay off of the SDN list) is that a designated party shouldn’t feel entirely safe traveling internationally if there is no publicly returned indictment against them. A sealed indictment may be lurking out there, in which case the OFAC designation would just be one part of their larger set of problems.

The author of this blog is Erich Ferrari, an attorney specializing in OFAC matters. If you have any questions please contact him at 202-280-6370 or ferrari@ferrari-legal.com.