Illicit Finance

Bulk cash shipment and money services businesses (MSBs) are the primary methods used by DTOs operating in the HIDTA region to move illicit drug proceeds from the area for laundering. Drug proceeds that remain in the Rocky Mountain HIDTA region are often laundered by traffickers through cash-intensive front businesses and the purchase of tangible assets.

Mexican DTOs use the Rocky Mountain HIDTA region as a staging area to consolidate large amounts of bulk currency that they derive from local wholesale drug transactions and from wholesale transactions in other markets supplied from the region. These DTOs generally transport illicit drug proceeds to consolidation points around Colorado Springs and Denver prior to transporting the money in bulk to areas at or near the U.S.-Mexico border. Thereafter, Mexican DTOs smuggle the proceeds into Mexico for eventual repatriation to the United States. Mexican DTOs compartmentalize their drug distribution and money laundering operations by limiting members' involvement to one specific responsibility. They accomplish this through the use of cells to minimize risk to the entire organization in the event that one or more members are arrested. In such an operation, one cell transports a particular drug, such as cocaine, from Mexico or the Southwest Border area to distribution centers in Denver, Colorado Springs, or Salt Lake City. A separate cell transports currency in bulk from those cities to Mexico through southwestern states.

Mexican DTOs also use MSBs to electronically wire-transfer illicit drug proceeds to areas along the U.S.-Mexico border and into Mexico. Some Mexican DTOs operate MSBs and hire Mexican nationals in groups of 15 to 30; these individuals receive as little as $20 per day to transmit funds to locations in the Southwest. Additionally, in some areas of the HIDTA region, law enforcement officials report that bulk currency shipments have decreased and that wire transfers to Mexico have increased, particularly regular transfers in small amounts. Moreover, law enforcement officials report an increase in the number of unlicensed money remitters operating from Mexican-owned businesses in the region.

Retail-level drug distributors, including African American, Asian, and Hispanic street gang members, rarely engage in the bulk transport of drug proceeds from the HIDTA region. Instead, they typically use proceeds generated from retail-level drug distribution to operate cash-intensive retail businesses in which they can commingle drug proceeds, or they purchase expensive personal items such as jewelry, luxury vehicles, and real estate.

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