Source: United States Department of Justice Criminal Division
A Mexican national pleaded guilty yesterday to participating in a two-year, multimillion-dollar trade-based money laundering conspiracy that moved drug trafficking proceeds through Texas to Mexico.
According to court documents, Gabriel Arturo Castillo, 52, of Monterrey, Nuevo León, Mexico, participated in a sophisticated, international money laundering conspiracy to transfer proceeds from the sale of illegal drugs in the United States to cartels in Mexico without physically transporting money across the U.S.-Mexico border. The conspirators concealed those funds through the movement of goods between the two countries.
As part of the black-market peso exchange scheme, the criminal conspiracy received large quantities of United States dollar drug proceeds in various cities in the United States. The proceeds then either were deposited into various bank accounts or transported to Laredo, Texas. From there, the drug proceeds were sold to Mexican business owners in Mexico who used the U.S. currency to purchase products from stores in the United States, including perfume sellers. Once the businesses received payment, the merchandise purchased by the Mexican business operators was transported from Laredo to Mexico. Finally, Mexican business operators paid for the drug proceeds by transferring pesos in Mexico to the drug trafficking organizations. By doing so, the conspirators sought to conceal the source of the drug proceeds and to allow the Mexico-based drug dealers to receive their profits in their native currency, pesos.
“For years, Gabriel Arturo Castillo agreed to launder millions of dollars in drug proceeds through an intricate trade-based money laundering system,” said Assistant Attorney General A. Tysen Duva of the Justice Department’s Criminal Division. “Cartels are motivated by profit, and these financial facilitators promote their deadly drug trafficking and endanger lives, legitimate business, and trade. The devastating effects of this transnational crime are vast and wide ranging. This conviction sends a clear message that the Criminal Division will pursue narcotraffickers as well as those who enable their crimes.”
“Castillo and his co-conspirators all played a critical role in laundering millions of dollars in drug proceeds through an intricate trade-based money laundering scheme,” said Acting U.S. Attorney John G.E. Marck for the Southern District of Texas. “This plea is yet another step we are taking to dismantle the financial networks that fuel violence and narcotics trafficking along our southern border. We will continue to follow the money trail until all participants in this organization are held accountable.”
“Gabriel Castillo played a key role for years in hiding drug trafficking proceeds using complex money laundering schemes,” said Special Agent in Charge Miguel Madrigal of the Drug Enforcement Administration (DEA) San Antonio Division. “Castillo helped facilitate the concealment of drug profits through elaborate laundering operations. But once DEA agents in Laredo started their investigation, they swiftly identified the cartel’s activities, leading to justice and ending the criminal schemes that empower their operations.”
“The specific type of scheme they used is called a black-market peso exchange, versions of which existed for decades and can be as complex as the concept is old,” said Acting Special Agent in Charge Rodrick Benton of the IRS Criminal Investigation’s Houston Field Office. “We were able to follow the money to unravel how merchandise was purchased from U.S. businesses near the border and then sold in Mexico for a predetermined price. You can’t hide your ill-gotten gains from a law enforcement agency dedicated to following the money.”
Castillo pleaded guilty to conspiracy to commit money laundering. He is scheduled to be sentenced on July 7 and faces a statutory maximum penalty of 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The DEA and IRS-CI are investigating the case.
Trial Attorneys Keith Liddle and Stephanie Williamson of the Criminal Division’s Money Laundering, Narcotics and Forfeiture Section (MNF) and Assistant U.S. Attorneys Lance Watt and Amanda Gould for the Southern District of Texas are prosecuting the case.
The Justice Department’s Office of International Affairs worked with law enforcement partners in Mexico to secure the arrest and August 2025 extradition of Castillo.
MNF’s mission is to take the profit out of crime, eliminate drug cartels, and protect the U.S. financial system. MNF pursues criminal prosecutions and criminal and civil asset recovery actions involving: financial facilitators who launder profits for criminals; financial institutions and their officers and employees whose actions threaten the U.S. financial system and financial institutions; international money launderers who support transnational organized crime; and the top command and control of international drug trafficking organizations.
MNF’s Money Laundering and Forfeiture Unit investigates and prosecutes sophisticated money laundering schemes involving financial facilitators, gatekeepers, and other individuals and entities laundering criminal proceeds, and litigates complex civil forfeiture cases to recover assets on behalf of victims.