Citi, Mellon Cut Ties with Intercam after US Accusations

Banking giants Citigroup and Bank of New York Mellon have begun severing ties with prominent Mexican financial institution Intercam Banco following allegations of money laundering for drug cartels.

Intercam maintains its innocence, and Mexican authorities have yet to find conclusive evidence of wrongdoing. But the institution faces an uphill battle to restore its international standing and business relationships.

The Treasury’s unprecedented move comes just days after the Financial Crimes Enforcement Network (FinCEN) designated Intercam—along with CIBanco and Vector Casa de Bolsa—as institutions “of primary money laundering concern” in connection with illicit fentanyl trafficking operations. Mexican President Sheinbaum has insisted that the US provide proof of the allegations, but has received no response.

Intercam in the Crosshairs

Intercam, a commercial bank with over $4 billion in total assets, stands accused by U.S. authorities of maintaining “a long-standing pattern of associations, transactions, and provision of financial services that facilitate illicit opioid trafficking by Mexico-based cartels, including CJNG.”

The Treasury’s damning assessment alleges that between 2021 and 2024, Intercam handled more than $1.5 million in transactions from Mexico to a China-based company known for supplying precursor chemicals to cartels. These transactions allegedly helped finance the procurement of chemicals essential to fentanyl production, linking the financial institution directly to the deadly drug trade that has claimed hundreds of thousands of American lives.

Perhaps most troubling for Intercam’s reputation, U.S. investigators claim the bank’s involvement wasn’t merely passive negligence, but rather part of a systematic pattern of facilitating cartel operations. The designation specifically ties Intercam to the powerful Jalisco New Generation Cartel (CJNG), one of Mexico’s most violent and sophisticated criminal organizations.

Swift Corporate Response

The impact of the U.S. designations has been immediate and severe. Citigroup has taken steps to cut ties with CIBanco SA and Intercam Banco SA, according to a person familiar with the matter. BNY has frozen the assets of those two banks, as well as brokerage Vector Casa de Bolsa SA, and is returning transactions from those firms and their affiliated entities.

This corporate exodus effectively cuts Intercam off from the U.S. financial system, a devastating blow for any institution seeking to conduct international business. The prohibitions, which become effective 21 days after publication in the Federal Register, prevent U.S. financial institutions from engaging in fund transfers to or from Intercam or any accounts administered on behalf of the Mexican bank.

Intercam’s Defiant Response

Faced with these career-threatening allegations, Intercam “categorically” denied “any association between this institution and any illicit activity — particularly money laundering.” The bank has reiterated “its firm commitment to transparency and legality” in public statements following the Treasury Department’s announcement.

Intercam’s leadership has maintained that the institution operates within all applicable laws and regulations, expressing confidence that the allegations will ultimately be proven unfounded. However, the bank has yet to provide detailed explanations for the specific transactions flagged by U.S. investigators.

Mexico’s Emergency Response

The severity of the U.S. allegations prompted extraordinary action from Mexican authorities. Mexico’s bank regulator stepped in to temporarily run CIBanco SA and Intercam Banco SA, an extraordinary measure aimed at protecting customers following money-laundering accusations by US authorities.

Mexican Finance Minister Edgar Amador Zamora sought to reassure the public during President Claudia Sheinbaum’s morning press conference, stating that “the money of account holders is safe, ‘Absolutely.'” The intervention came after Mexican officials discovered that “the lines of financing for these three entities had problems” following the U.S. designations.

Despite the dramatic government intervention, officials emphasized that Intercam and the other targeted institutions represent less than 1% of “deposits in the banking system” in Mexico.

Broader Diplomatic Tensions

The Intercam case has become a flashpoint in U.S.-Mexico relations, with President Sheinbaum questioning the fairness of American enforcement actions. “There is no proof” of money laundering in the documents published by the United States Treasury Department, Sheinbaum declared, highlighting Mexico’s request for concrete evidence to support the allegations.

Mexican officials have pointed out what they view as a double standard, noting that “United States banks that confessed in recent years that they have links to money laundering only received reprimands or fines from the United States government.”

Looking Forward

The Intercam case represents the first major test of expanded U.S. authorities under the Fentanyl Sanctions Act and the FEND Off Fentanyl Act, legislation designed to give Treasury unprecedented power to target financial institutions suspected of facilitating drug trafficking.

The case serves as a stark reminder of the far-reaching consequences of America’s intensified campaign against the fentanyl trade—consequences that extend well beyond traditional law enforcement into the very heart of Mexico’s financial system.