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Tether: A Money Laundering Engine for Mexican Cartels, Feds Claim

Tether used for drug businesses
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Tether (USDT) has allegedly become a favored tool for Mexican drug cartels to launder millions, according to unsealed court records. USDT’s connection to narcotics proceeds has even driven its price down in Mexico as law enforcement uncovers the cryptocurrency’s deep ties to global trafficking networks. Unsealed court records expose Tether’s role in laundering millions for Mexican drug cartels, showcasing crypto’s dark side in global crime networks.


Key Points

  • Massive Laundering Network: Mexican and Colombian drug cartels allegedly moved tens of millions of dollars using USDT and front businesses.
  • Cheaper in Mexico: Tether sells below market price in Mexico due to its association with drug proceeds.
  • Cross-Border Crime: USDT facilitates rapid cross-border transfers, fueling cartels’ global operations.
  • High-Volume Activity: A single Binance account linked to cartels moved over $15 million through 1,000+ transactions.

Short Narrative

According to a new report published by 404 Media, the stablecoin Tether (USDT) has become a cornerstone for laundering drug proceeds, enabling Mexican and Colombian cartels to move wealth across borders swiftly. USDT’s ties to narcotics proceeds have made it cheaper in Mexico, where it is traded extensively through peer-to-peer platforms and OTC deals.

Authorities traced over $15 million in USDT transactions from cartel-linked accounts, including transfers via Binance and other exchanges. Confidential sources confirmed Tether’s integral role in cartel operations, noting large stockpiles in cities like Guadalajara and Mexico City. The investigation highlights how cryptocurrencies, marketed for transparency, are being exploited by organized crime on an unprecedented scale.


Actionable Insight

Compliance teams must prioritize blockchain tracing and enhance anti-money laundering (AML) measures, particularly for stablecoins like Tether. Regulators should push for stricter oversight of crypto exchanges and decentralized networks to mitigate risks tied to illicit activities.


Call for Information

Do you have insights into how cryptocurrencies are used in laundering operations? Share your knowledge confidentially with FinTelegram to expose global financial crime networks.

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