Sinaloa Cartel: How the empire of Chapo Guzman got involved in new businesses such as movie theaters and jewelry stores

For several years, Sinaloans have had fun in movie theaters, shopping at jewelry stores and hiring advisory services, advertising and construction belonging to the Sinaloa Cartel.

OFAC's list reveals that the Sinaloa Cartel is the organization with the largest presence of partners and companies in Mexico and abroad. Photo: France24
OFAC's list reveals that the Sinaloa Cartel is the organization with the largest presence of partners and companies in Mexico and abroad. Photo: France24

The Financial Intelligence Unit of the Ministry of Finance and Public Credit revealed the movement of nearly $2 billion pesos from five companies in Mexico, which have helped to triangulate resources benefiting the criminal organization and its main financial operators.

The first illegal activity was located in the state of Jalisco, where a financial operator of the Sinaloa Cartel received through his wife resources from a company established in that entity. The company issued a total of 58 checks that were collected in cash for $12,776,000 pesos.

One of the partners of this company is also the legal representative of at least 13 other businesses, which are engaged in advertising, consulting, advisory and construction, which together have recorded cash withdrawals of $497 million pesos.

The following movements were detected in the capital of Sinaloa, where through a company, two operators acquired four properties in Culiacan for $17,352,000 pesos. In addition, they made purchases -which do not correspond with their tax returns- for $14,118,000 pesos. Both operators of the Sinaloa Cartel are also partners of a jewelry store linked to another located in Delaware, the United States, which triangulated resources for $10,452,000 pesos.

The Sinaloa Cartel has also taken over an extensive network of cinemas in Culiacan, which generated $884,938,000 pesos, of which the organization received cash deposits of $456,421,000 pesos. It was detected that the representative of the chain of cinemas, through a family member constituted a company dedicated to construction with which withdrawals were made for more than 100,000,000 pesos.

The businesses of Ismael "El Mayo" Zambada, founder of the Sinaloa Cartel, are even more exquisite. According to U.S. authorities, the capo is related to milk companies, spas, and daycare centers.

Sinaloa Cartel diversifies and now also traffics in migrants

The Associated Press has collected dozens of testimonies from migrants and some "coyotes" or "polleros" at various points along the routes in Central America and Mexico that show that migrant trafficking is a thriving business that has been able to adapt to new needs.

The Sinaloa Cartel is engaged in trafficking migrants along 600 kilometers of the 3,200 km border between Mexico and the United States, according to testimony from an alleged financial operator of the criminal organization, who said the business brings them profits of about USD 1,000,000 per month (about $20 million Mexican pesos).

Asking to be identified only by the name of Manuel, this middle-aged man who manages the profits obtained from the trafficking of migrants states: "We control the entire border" from Sonora to Arizona. This financial manager also runs a nightclub in the city of Hermosillo, 300 kilometers from the border.

Although he does not explicitly mention it, everyone knows he is an operator for the Sinaloa Cartel. The tightening of U.S.-Mexico immigration policy has resulted in more security forces on the border and "hindered" business, but Manuel is not worried: "There may be fewer crossings and more is spent, but it also charges more, which means the money keeps flowing".

And in a year in which there have been big changes on both sides of the border, there is a combination of new ways with old techniques: higher prices for travel, payments for surrendering to authorities, new "offers", but also the use of traditional routes and bribes to officials in both countries.

In the territory that Manuel manages, he says, they earn USD 1,000,000 a month, which represents a small part of a multi-million dollar business that the United Nations Office on Drugs and Crime estimates at USD 4 billion, while the Mexican government raises the figure to USD 6 billion.

Although the measures initiated by the two countries appear to have discouraged some from emigrating, they have also convinced others that their journey can only be successful at the hands of a professional: "It is a business that will not stop," said Manuel.

With the exception of a few places, such as official sentry boxes, organized crime controls every kilometer that separates the two countries and decides what, who, when and how it crosses and for how much money in each place, says the AP report.

Management and rules vary according to the dominant cartel, but there is a common denominator: A migrant may be able to bypass the sophisticated traffic network to enter or cross Mexico, although almost never when crossing to the United States.

The "coyotes", who used to be seen as people trusted by migrants, have had to pay the mafias for permits to cross migrants of a certain nationality, for example, or to use a certain pass or change to another one if they are crossing another "commodity", such as drugs, through the first one.

The financial operator says that the "company" (the cartel) rents the "plaza" or territory to local gangs so that they can use it and manage what it traffics, and pays the security forces to let them operate.

He gives the example of Nogales, where the "fee" to each corporation "so it doesn't bother" is $25,000 dollars a month (about half a million pesos). He says everyone is paid: local, state, federal police, including the National Guard. The exception is the Army, he says, which chooses to look the other way, although "one way or another they benefit, with favor or something.

The list of the office of foreign assets control

Since 2007, the U.S. Department of the Treasury began to demonstrate the existence of more than 250 companies established by this organization in Mexican territory and in Latin American and European cities. The Kingpin Act classified Chapo Guzmán, Mayo Zambada, and Juan José Esparragoza Moreno, El Azul, as the ringleaders.

On May 17 of that year, the agency released the list of the cartel companies established in Sinaloa, which functioned as a front for money laundering. Eight months later, the Cázares Salazar financial network appeared, which includes marketing companies, factories, restaurants, and real estate agencies, among others. On December 15, 2009, the Treasury Department attributed links with drug trafficking organizations in Central America and Colombia to the cartel.

The Sinaloa organization was linked to Guatemalan capo Waldemar Lorenzana Lima and three other individuals from his network in that country. And in Colombia, it was linked to the network of Jorge Milton Cifuentes Villa and his companies, which range from foundations to airlines located in that country, Panama, Mexico, the United States, and Spain.

In 2012, the Sinaloa Cartel was blacklisted by Marllory Dadiana Chacón Rossell's organization in Guatemala, whose companies were located in that country and in Panama. That same year, the Office of Foreign Assets Control (OFAC), part of the Treasury Department, identified María Alejandrina Salazar Hernández and Jesús Alfredo Guzmán Salazar as Chapo's relatives.

In the case of the companies, the most recurrent lines of business are cattle ranching and farming, as well as exchange houses, imports, exports and the manufacture of clothing and airlines.

The capos use wives, sons, daughters, brothers, cousins, compadres, and friends of their respective families in these signatures. OFAC published full names and photographs of at least 70 people on its famous list.

In the case of Mexico, Sinaloa cartel concentrates 108 people and companies that allegedly launder resources; 34 are located in Jalisco; 32 in Mexico City; 30 in Baja California; 24 in Sonora; and the rest in Chihuahua, Durango, the State of Mexico, Michoacán, Morelos, Nuevo León, Puebla and Quintana Roo.

OFAC's list reveals that the Sinaloa Cartel is the organization with the largest presence of partners and companies in Mexico and abroad, which consolidates it as a strong international money laundering network.

The organization has at least 52 companies and presumed laundering partners in Colombia, 14 in Guatemala, 10 in Honduras, six in Panama, four in Ecuador, two in Belize, one in Venezuela, one in Israel and one in Spain. It recently added companies from Asia.

During the operation to free Ovidio Guzmán López, this wealth was fundamental in moving the "plebada," (folks) especially the youth. Iván Guzmán Salazar and Joaquín Guzmán López allegedly offered 20,000 pesos to each of those who joined Ovidio's rescue.

The Sinaloa cartel as seen from the inside

The criminal organization that reigns in Sinaloa, indicated as the one led by Joaquín Guzmán Loera, "El Chapo", or Ismael Zambada García, "El Mayo", is not the way it has been tried to be told.

From within the Sinaloa cartel, it is explained that there is no pyramidal structure in this organization. Photo: Zocalo
From within the Sinaloa cartel, it is explained that there is no pyramidal structure in this organization. Photo: Zocalo

From within the organization, explanations were given to Grupo Reforma, which reported that there is no pyramidal structure, that is to say, there is no formal leader, not even below these other leaders who act as managers, far from it.

There are criminal groups that have adapted to territories and forms for the production, commercialization, sale, and profit on illegal drugs with visible heads, but that act independently, not subject to totalitarian leadership.

The Sinaloa cartel is not a single-family and not an organization like the governments of Mexico and the United States have wanted to point it out. Instead, they are several families that share the same territory and sometimes do business together. Thus, under this scheme, the "Cartel" is an organization made up of an accumulation of organizations that coincide in strategies, territory, and products to traffic in an illicit manner.

The organization is made up of different groups, including those of Ismael Zambada García, the Cázarez Salazar family, the Flores Cacho family, Rafael Caro Quintero's group, the Fuentes Villa family, Juan José Esparragoza Moreno's family, Joaquín Guzmán Loera's children, Héctor Román Angulo's family and Dámaso López Núñez's family, among others. Of these, names and characters stand out, such as Ismael Zambada García, "El Mayo", and Rafael Caro Quintero, but none of them have been, to date, selected as a maximum leader, explain the informants.

All these groups act together in situations that put this organization at risk. As an example, the operation to avoid the arrest of Ovidio Guzmán López, son of "El Chapo", was cited. Each of these groups may have different methods of drug distribution, transport, and sales territory, but they have the ability to reach agreements to avoid confrontation or to complete their work.

This type of organization, in which different organizations concur, occurs with the rest of the country's criminal organizations, that is, the Jalisco New Generation Cartel, the Gulf Cartel, among others, which have the same process and composition. They are groups, most of them small, that reach agreements to rely on illicit businesses or to protect themselves, as happened on October 17 in Culiacán, when different gangs joined together to avoid the detention of Ovidio Guzmán López.

Agencies