Today the United States Department of the Treasury Office of Foreign Assets Control (OFAC) designated four Mexican brothers as Specially Designated Nationals (SDNs). The four brothers are Daniel Rodriguez Olivera, Esteban Rodriguez Olivera, Luis Rodriguez Olivera, and Miguel Rodriguez Olivera. OFAC has referred to these brothers as the “Band of Narcotics Trafficking Brothers” and placed upon them a designation which prohibits U.S. persons from engaging in transactions with them and blocks any assets they held under U.S. jurisdiction. According to OFAC, these individuals are believed to be the leaders of the Los Gueros drug trafficking organization and key members of the Sinaloa Cartel.

Two of the brothers, Luis and Esteban Rodriguez Olivera, were previously charged in the United States for narcotics trafficking. According to the indictment these two brothers operated a narcotics supply route originating in Mexico that entered the United States through Texas before branching off to various points throughout the United States. It is believed that the Los Gueros organization has allegedly imported over 100,000 kilograms of cocaine into the United States.

Since 2000, OFAC has designated more than 950 businesses and individuals linked to 87 drug kingpins. The penalties for dealing with such individuals range from civil penalties of up to $1.075 million per violation to more severe criminal penalties. Criminal penalties for corporate officers may include up to 30 years in prison and fines up to $5 million. Criminal fines for corporations may reach $10 million. Other individuals face up to 10 years in prison as well as the possibility of fines.

Another problem that this band of brothers might face is being shunned by Mexican banks. A number of Mexican nationals I have spoken with over the past few months who have been placed on the OFAC SDN List have indicated that Mexican banks have elected to not do business with those individuals because of their SDN designation. From the perspective of the Mexican banks it makes sense; if the U.S. government has stated these parties are involved in illicit activity then the risks for the bank to do business with the individual is too great, particularly if the bank conducts business with the U.S. As such, its more important than ever for SDNs to engage counsel familiar with the OFAC SDN removal process and fight their designation on the OFAC SDN list. The ramifications of not doing can haunt the designated party forever.

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.