Kingpin Act

The United States Department of the Treasury’s Office of Foreign Assets Control [hereinafter OFAC] has identified 30 companies and individuals associated with two Mexican drug trafficking cartels.^[1] Pursuant to the Foreign Narcotics Kingpin Designation Act [hereinafter Kingpin Act], the assets of these front companies can be frozen, and U.S persons are prohibited from engaging in financial and commercial transactions with the designated organizations.^[2]

The organizations named in the OFCA report are the Arriola Marquez Organization, and the Arellano Felix Organization.^[3]

The Arriola Marquez Organization is based in Saucillo, Chihuahua, and it controls a significant flow of marijuana and cocaine from Mexico into the United States.^[4] The fronts associated with this organization are two cattle businesses, two real estate firms, an automotive sales company, a gasoline distributor, a food distributor, and a currency exchange house.^[5]

The Arellano Felix Organization is based in Tijuana, Baja California, and it orchestrates the transportation, importation, and distribution of tons of cocaine and marijuana, as well as large amounts of heroin and methamphetamine.^[6] The fronts associated with this organization are linked to a large Mexican drugstore chain.^[7]

The Kingpin Act is codified at 21 U.S.C. § 1901 et seq. The relevant statute to this action by OFAC is 21 U.S.C. § 1904, which states that it applies to any significant foreign narcotics trafficker which has been publicly identified.^[8] On the date that a designating announcement is made, the property and property interests of any significant narcotics trafficker or persons providing support to significant narcotics traffickers are blocked.^[9] Furthermore, any transactions between a United States person and the designated significant narcotics trafficker are prohibited, as are any transactions that evade or attempt to evade the prohibition.^[10]

---

[1] OFAC, Press Release: Treasury Targets Front Companies and Individuals Tied to Mexican Drug Cartels, Aug. 18, 2005, available here.
[2] Id.
[3] Id.
[4] Id.
[5] Id.
[6] Id.
[7] Id.
[8] 21 U.S.C. § 1904(a).
[9] Id. § 1904(b).
[10] Id. § 1904(c).