by the El Reportero‘s wire services

On Friday, President of the United States Donald Trump informed Mexican President Claudia Sheinbaum in a letter that he would impose a 30 percent tariff on Mexican imports beginning Aug. 1.

“Mexico has been helping me secure the border, BUT, what Mexico has done, is not enough,” the letter states. “Mexico still has not stopped the Cartels who are trying to turn all of North America into a Narco-Trafficking Playground.” Trump also announced a 30 percent tariff on imports from the European Union, due to “persistent, trade deficits, engendered by your tariff, and non-tariff, policies and trade barriers,” the president said in a separate letter.

On Monday, Sheinbaum announced that the concerns cited in the letter would be addressed in ongoing bilateral talks, particularly the significant U.S. trade deficit with Mexico. She expressed confidence that Mexico would be able to negotiate a deal to reduce, if not eliminate, the tariff.

The new tariffs were a blow to Sheinbaum’s cabinet, which has made numerous trips to Washington to ensure Trump’s advisors that Mexico is making progress on the issues identified as priorities by the U.S. president.

In recent weeks, U.S. Secretary of State Marco Rubio praised Mexico for being “very responsive” to Washington’s demands and U.S. Treasury Secretary Scott Bessent called Mexico’s proposals “positive.”

Mexico was informed that the letter was coming during high-level talks with U.S. State Department officials on Friday. The Mexican delegation expressed disagreement with the decision and considered it “unfair treatment,” according to a joint statement of the Economy Ministry and the Foreign Affairs Ministry.

Sheinbaum, who has avoided directly criticizing  Trump, voiced confidence that the U.S. and Mexico will be able to discuss the matter diplomatically.

“I’ve always said that in these cases, you need a cool head to face any problem,” Sheinbaum said on Saturday.

The tariff, if it goes into effect, could cause massive upheaval between the United States and its biggest trade partner.

The 30 percent rate would effectively replace the 25 percent tariffs currently levied on Mexican goods that do not comply with the existing U.S.-Mexico-Canada free trade agreement (USMCA).

The letter did not address whether USMCA-compliant goods would still be exempt from the new tariffs after Aug. 1.

Columnist for the newspaper El Financiero Enrique Quintana estimated that approximately US $150 billion worth of Mexican goods would be subject to the new 30 percent import tax.

In the joint statement, Mexico said “the first major task of the permanent binational committee will be to conduct the work so that, before [the tariffs take effect], we have an alternative that will protect businesses and jobs on both sides of the border.”

The bilateral talks involve Ebrard’s Economy Ministry along with the foreign relations, finance, security and energy ministries.

On its side of the table, the U.S. State Department is joined by the Commerce and Energy departments, Homeland Security and the U.S. Trade Representative.

Sheinbaum said Mexico’s negotiators will emphasize the progress her administration has made in the fight against organized crime, while also seeking to gain greater cooperation from U.S. counterparts.

“We have insisted that controlling the flow of weapons from the United States to Mexico, and arresting individuals involved in drug trafficking in the United States [requires] collaboration,” she said on Monday. “Yes, there is coordination, but part of [the responsibility] falls on us to prevent drugs from passing from here to there, but part of it also falls on them.”

Sheinbaum said her administration will continue working to reach a satisfactory agreement. “The most important thing for us is to ensure that employment is not affected and that cooperation between our countries is maintained,” she said.

As has been the case since Trump imposed the first of a string of tariffs on Mexico, Sheinbaum has declined to discuss retaliatory tariffs. In his letter, Trump included a threat to raise the tariffs should Mexico opt to retaliate.

With reports from The Associated Press, El Economista, El Financiero, Reuters and The Guardian

by Mexico News Daily

Could Mexico join countries such as Haiti, Venezuela and South Sudan on the Financial Action Task Force’s “grey list” due to deficiencies in its measures to counter money laundering?

In light of the United States government’s money laundering accusations against three Mexican financial institutions, an expert who spoke to the newspaper El Universal believes that it is a distinct possibility.

The Financial Action Task Force (FATF) is an intergovernmental organization that describes itself as “the global money laundering and terrorist financing watchdog.”

The organization maintains a “black list,” which “identifies countries or jurisdictions with serious strategic deficiencies to counter money laundering, terrorist financing, and financing of [weapon] proliferation.”

Three countries — North Korea, Iran and Myanmar — are currently on that list.

The FATF also has a “grey list,” which “identifies countries that are actively working with the FATF to address strategic deficiencies in their regimes to counter money laundering, terrorist financing, and [weapon] proliferation financing.”

“When the FATF places a jurisdiction under increased monitoring” — i.e. on the “grey list” — “it means the country has committed to resolve swiftly the identified strategic deficiencies within agreed timeframes and is subject to increased monitoring,” according to the intergovernmental organization.

There are currently 24 countries and jurisdictions on the “grey list,” including the three mentioned above as well as Algeria, Bulgaria, Kenya, Monaco, Syria and the British Virgin Islands, among others.

US accusations ‘will be reflected in next FATF assessment,’ says anti-money laundering expert  

El Universal reported on Monday that there is a risk that Mexico will be added to the FATF’s “grey list” due to the alleged cases of “narcolavado” (drug trafficking-related money laundering) involving the Mexican banks CIBanco and Intercam and the Mexican brokerage firm Vector.

The newspaper’s assessment was based on an interview with Genaro Gómez Muñoz, an anti-money laundering expert who is a member of the Money Laundering Prevention and Anti-Corruption Commission of the Mexican Institute of Public Accountants.

Gómez Muñoz told El Universal that the United States’ allegations against CIBanco, Intercam and Vector — all of which denied the allegations that they laundered millions of dollars for drug cartels — “will be reflected in the next FATF assessment” of Mexico, whose results will be announced later this year.

He noted that Mexico’s capacity to counter money laundering hasn’t been assessed by the FATF since 2017. This year’s assessment comes at a time when the Mexican government is seeking to strengthen anti-money laundering legislation. A proposed reform to that end was approved by the Senate last week.

Nevertheless, “the cases of the banks that are allegedly involved with [money laundering related to] drug trafficking will impact us in the result” of the FATF assessment, Gómez Muñoz said.

He said that the FATF’s rating of “due diligence” in Mexico with regard to efforts to prevent money laundering would suffer as a result of the United States’ accusations against CIBanco, Intercam and Vector.

Gómez Muñoz: US saw ‘a risk to the integrity and security of their financial system’

The United States Treasury Department’s Financial Crimes Enforcement Network (FinCEN) outlined the accusations against CIBanco, Intercam and Vector in orders that also prohibit transactions between U.S. banks and the three Mexican financial institutions.

FinCEN said last week that its orders would “become effective 21 days after … [they] are published in the Federal Register,” which occurred last week.

“By that date [mid-July] covered financial institutions should … cease any and all transmittals of funds, from or to CIBanco, Intercam, or Vector, as defined in the orders,” FinCEN said.

The orders were the “first actions by FinCEN pursuant to the Fentanyl Sanctions Act and the FEND Off Fentanyl Act,” the Treasury Department said in a statement.

United States Secretary of the Treasury Scott Bessent said last Wednesday that, “Through the first use of this powerful authority, today’s actions affirm Treasury’s commitment to using all tools at our disposal to counter the threat posed by criminal and terrorist organizations trafficking fentanyl and other narcotics.”

Gómez Muñoz, an accountant who has also worked as an academic, told El Universal that the main reason FinCEN turned its focus to Mexico was to protect the United States’ financial system.

“They saw there is a risk to the integrity and security of their financial system, [with it] being used by criminal organizations related to the trafficking of fentanyl, which at this time is the enemy of United States society,” he said.

CIBanco and Intercam customers report restrictions on USD transactions 

The El Economista newspaper reported on Friday that CIBanco and Intercam customers had reported restrictions on “the management of operations in their dollar accounts.”

“In the case of CIBanco, the manager of a company who preferred not to be identified, explained that he can’t withdraw, transfer or exchange foreign currency from his dollar account,” El Economista said.

The newspaper said that two other CIBanco customers it spoke to reported that there hadn’t been any problems with transfers in Mexican pesos.

El Economista didn’t provide additional details on the problems it said Intercam customers have also experienced when managing their dollar accounts.

Both CIBanco and Intercam were disconnected from Mexico’s SPEI money transfer system for five hours last Thursday, the newspaper said.

The National Banking and Securities Commission (CNBV) decreed “temporary managerial interventions” at CIBanco, Intercam and Vector after the United States government accused the three financial institutions of money laundering.

Finance Minister Edgar Amador Zamora said on Friday that the aim of the administrative takeovers was to “ensure there were no interruptions in the banking system and to look after … the savings of the clients of these institutions.”

Asked whether the money of account holders at the three financial institutions is safe, Amador responded, “Absolutely.”

With reports from El Universal