Thursday, October 22, 2009

Treasury Designates Mexican Nationals, Company as Specially Designated Narcotics Traffickers

The U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) today designated Mexican national Edgardo Leyva Escandon, five members of his financial network, and one Mexico-based company as Specially Designated Narcotics Traffickers for their ties to the Arellano Felix Organization (Tijuana Cartel), Francisco Javier Arellano Felix, or Tijuana Cartel member, Edgardo Leyva Escandon. Pursuant to the Foreign Narcotics Kingpin Designation Act (Kingpin Act), today's designation freezes any assets the designees may have under U.S. jurisdiction and prohibits U.S. persons from conducting financial or commercial transactions with the designees.

"We are taking this action to disrupt Edgardo Leyva Escandon's ability to access weapons and financial conduits on behalf of the Arellano Felix Organization," said OFAC Director Adam J. Szubin. "We will do everything in our power to support the determined counter-narcotics efforts of the Government of Mexico."

The Arellano Felix Organization was named a Tier I Kingpin by the President in June 2004. The principal of this Arellano Felix Organization cell is Edgardo Leyva Escandon, the organization's primary ammunition and firearms supplier, an assassin and a personal assistant to Francisco Javier Arellano Felix, also designated a Tier I Kingpin in June 2004. According to a Southern District of California complaint, Leyva Escandon purchased cases of ammunition from multiple San Diego-based firearms merchants, acquiring thousands of rounds at a time. During a July 22, 2006 search of Leyva Escandon's residence, the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) seized more than 450 rounds of assorted ammunition and conversion kits for the production of fully automatic Uzi machine guns.

In addition to ammunition trafficking, Leyva Escandon helped procure the Dock Holiday yacht, which was utilized by Francisco Javier Arellano Felix. On August 14, 2006, the Drug Enforcement Administration (DEA), with assistance from the U.S. Coast Guard, arrested Francisco Javier Arellano Felix while he was on-board the Dock Holiday in international waters.

In addition to the ATF, Edgardo Leyva Escandon is wanted by the DEA and is the subject of a $2 million reward under the auspices of the State Department's Narcotics Rewards Program.

Also designated today are the following Edgardo Leyva Escandon financial operators: Aristoteles Alejandro Abaroa Preciado, Victor Manuel Abaroa Diaz, Victor Hussein Abaroa Preciado, Elia Yolanda Preciado Gamez and Rosa Yolanda Nabila Abaroa Preciado. The designation also includes a maritime equipment supplier Tienda Marina Abaroa, based in Baja California Sur, Mexico.

This action is part of ongoing efforts under the Kingpin Act to apply financial measures against significant foreign narcotics traffickers worldwide. Internationally, more than 500 businesses and individuals associated with 82 drug kingpins have been designated pursuant to the Kingpin Act since June 2000. Penalties for violations of the Kingpin Act 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 and fines pursuant to Title 18 of the United States Code for criminal violations of the Kingpin Act.

Today's designation would not have been possible without key support from DEA's San Diego Field Division, Tijuana Resident Office and Mazatlan Resident Office; the ATF's San Diego Field Office; and the U.S. Attorney's Office for the Southern District of California.

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