US says Mexican drug cartel was so bold in timeshare fraud that some operators posed as US officials

MEXICO CITY — A Mexican drug cartel was so brazen in committing fraud against elderly Americans that the gang’s operators posed as U.S. Treasury Department officials, U.S. authorities said Thursday.

The scam was described by the department’s Office of Foreign Assets Control (OFAC). The agency pursues fraudsters and uses call centers controlled by the Jalisco drug cartel to promote false offers to purchase U.S. timeshare properties. They defrauded at least 600 Americans of approximately $40 million.

But they also began contacting people claiming to be employees of OFAC itself, offering to release funds allegedly frozen by the US agency, which fights illicit funds and money laundering.

“Sometimes timeshare fraud perpetrators misuse the names of government agencies in an attempt to appear legitimate,” the agency said. “For example, perpetrators may call victims claiming to represent OFAC, demanding payment in exchange for releasing funds that the perpetrator claims OFAC has blocked.”

OFAC on Thursday announced a new set of sanctions against three Mexican citizens and 13 companies they say are linked to the Jalisco cartel, known by its Spanish initials as the CJNG, which has killed call center workers who tried to quit.

U.S. Treasury Secretary Janet L. Yellen said in the statement that “CJNG uses extreme violence and intimidation to gain control of the timeshare network, which often targets elderly U.S. citizens and can defraud victims of their life savings.”

In June, U.S. and Mexican officials confirmed that as many as eight young workers had died after apparently trying to quit their jobs at a call center operated by the Jalisco cartel.

While the victims’ families thought their children worked in a normal call center, in reality the office was run by Jalisco, Mexico’s most violent gang.