Another FinCEN Alert Related to Southern Border Activity
On June 30th FinCEN issued an Alert (FIN-20260-Alert003), FinCEN Supplemental Alert on Fuel Smuggling and Tax Evasion Schemes on the Southern Border Associated with Mexico-Based Cartels. This builds upon a May 2025 Alert (FIN-2025-Alert002), Oil Smuggling Schemes on the U.S. Southwest Border Associated with Mexico-Based Cartels. FinCEN asks financial institutions to be on alert for suspicious activity related to certain Mexico-based cartels that smuggle gasoline, diesel fuel, naphtha and other types of fuel from the U.S. into Mexico via the southern border and/or U.S. ports.
The goal of such smuggling schemes is to evade Mexican taxes on fuel illegally imported/smuggled from the U.S. The Alert points out that …fiscal fuel theft and traditional fuel and oil theft have, together, become the most significant non-drug illicit revenue source for the Cartels…and it’s estimated that …a quarter to a third of all fuel sold in Mexico
may be illicit.
The Alert provides some methodologies related to fuel smuggling, procurement and money laundering to help institutions understand these schemes as well as 22 red flag indicators.
FinCEN asks that institutions reference this Alert in SAR Field 2 (Filing Institution Note to FinCEN) and include the key term “FIN-2026-FISCALFUELTHEFT” in the Narrative.
Kevin discussed this Alert and many other timely AML/CFT topics during the July AML/CFT Membership Group meeting so be sure to check it out. We will also be covering the Alert in the August issue of our magazine, Banking on BCC.
Published 2026/07/28
Amy Kudlacek
Amy brings many years of banking and compliance experience to Banker’s Compliance Consulting. She has worked for both large and small financial institutions and spent time working in every area of a bank. She started out as a teller in college and eventually became a branch manager. Her love, however, was always compliance. Amy began her career with Banker’s Compliance Consulting in 2000. Her knowledge and experiences have allowed her to develop a well-rounded and practical approach to regulatory compliance. Amy is CRCM certified, has a Bachelors Degree in Business Administration and is a graduate of the ABA Compliance School. Amy & her husband have two children at home and stay busy following their activities. They spend a lot of time in the bleachers!