MEXICO CITY — In a small town in the western Mexican state of Michoacan, members of a criminal gang forced residents to pay exorbitant fees for internet service, threatening them with the death penalty if they didn't pay.
Following these threats, residents made monthly extortion payments while reporting the situation to the authorities.
After a months-long investigation, authorities searched three properties and found evidence, including antennas, internet relay devices and connections, which they turned over to prosecutors.
While it may seem surprising that a Mexican drug cartel is involved in Internet services, it comes as no surprise to those who follow the activities of these crime organizations.
“Drug cartels have diversified their activities since their inception,” said security analyst David Saucedo. “Many of them began as criminal organizations whose primary activity was not drug trafficking.”
Some gangs were involved in fuel theft, for example, others in vehicle theft and others specialized in robbing public transport, Saucedo said.
“The criminal groups involved in drug trafficking were also involved in these other activities before.”
In addition to the billions of dollars the cartels make from the drug trafficking industry, the most powerful drug cartel, Sinaloa Jalisco New Generation (CJNG), is involved in a number of lucrative illegal enterprises, according to the U.S. Drug Enforcement Administration.
“The Sinaloa Cartel is best known for drug trafficking, but it is also involved in extortion, oil and mineral theft, arms trafficking, migrant smuggling, and prostitution,” the 2024 National Drug Threat Assessment states.
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According to the report, the CJNG orchestrates the theft of fuel from pipelines, extorts money from agave and avocado farmers, migrants and prison officials, and levies taxes on migrant smugglers.
“The portfolio is extensive, but while drug trafficking is the most profitable activity, it also takes a long time to recoup investments compared to other criminal activities that generate almost immediate profits,” Saucedo said.
The scope of their crimes ranges from cartels encouraging elderly Americans to buy time shares in Mexico, resulting in losses of nearly $40 million, to cartel-backed smugglers trafficking migrants across the U.S.-Mexico border for increased profits.
Some of the ways the cartels have expanded their influence include:
Fuel Theft
Fuel theft, so-called Wachikoreo In Mexico, illegal pipeline tapping has become a highly profitable activity for organized crime groups. In the first nine months of 2022, Mexico's state-owned oil company, Pemex, lost $730 million due to illegal pipeline tapping.
Mexican cartels have developed sophisticated methods for stealing fuel that involve corruption, precision and violence.
These include tactics such as bribing Pemex employees and local officials for information, drilling precise illegal taps into pipelines, and using modified tanker trucks to transport the stolen fuel and distribute it through black market networks.
Several cartels are involved in this crime, such as the Santa Rosa de Lima Cartel, led by José Antonio Yepes, also known as El Maro, which established itself through fuel theft before turning to drug trafficking.
Additionally, CJNG and the Gulf Cartel are also involved in fuel theft, which provides a basis for their criminal activities.
avocado
Mexico's multi-billion dollar avocado industry, which continues to break export records every year, is also a prime target for drug cartels.
Avocados are known as “green gold” in Mexico, and the country is the world's largest producer of the popular fruit.
But as growers' wealth grows, so does the threat from drug cartels who want a cut of the profits.
In Michoacán, the only state allowed to export the fruit to the United States, the CJNG and local gangs demand so-called “protection payments” from farmers.
These fees range from $135 to $500 per hectare per month, depending on the size of the farm and the level of perceived threat.
The extortion process begins with the cartels identifying and targeting profitable farms. Armed cartel members approach farmers and threaten violence and property damage if the farmers do not comply.
In February 2022, the United States suspended imports of avocados from Mexico after U.S. officials received death threats while working in Uruapan.
Imports resumed a week later after the Mexican government applied new safety measures to the region.
Two years on, locals say not much has changed, with avocado growers continuing to face off against criminal gangs in the area.
tortilla
According to Mexico's Agriculture Ministry, the average Mexican consumes about 70 kilograms of tortillas per year, which is why they are a staple of Mexican cuisine and why the cartels are hoping to profit from them.
Cartel extortion affects an estimated 20,000 tortilla shops, directly affecting the prices Mexicans pay.
In an interview with The Washington Post, the National Tortilla Association said that of the more than 130,000 tortilla shops in the country, 14 to 15 percent have been victims of extortion.
The organization's president, Omerolo Lopez Garcia, told El Sol de Mexico newspaper that the establishments had to pay between $135 and $190 a week to various criminal gangs to stay open.
“Well, nothing surprises me anymore,” Saucedo, the security analyst, said of the cartels extorting money from tortilla vendors. “Maybe this is a bit of a callous, cynical attitude on my part, but the truth is, I remain open to all possibilities on this issue.”
chicken
A video posted to social media two days before Christmas 2023 shows gunmen arriving at a chicken shop in Toluca, Mexico, and kidnapping four employees and putting them in a white van.
Mexican prosecutors said the victims were retailers who were forced to buy chicken from some stores, who also had to pay a $2.50 per kilo fee in exchange for not being killed by the Familia Michoacana cartel.
Authorities said the anti-extortion efforts resulted in losses of more than $43 million from criminal gangs La Familia Michoacana and the CJNG, who threatened chicken and egg sellers in municipalities in the Toluca Valley and the south of the state.
The state prosecutor's office said 4,010 complaints about the crime were filed in 2023 alone, but only a quarter of those were filed directly, with the rest being indirect, via phone, social media or email.
Three months later, four workers kidnapped in December were found alive and four perpetrators were arrested, but the mastermind remains at large and the extortion campaign against chicken sellers continues, according to authorities.
“Piso” fare
“They asked me for $600 a month. Pisocobro“We reported it and had to close for a month,” Guillermo, a businessman who lives in downtown Mexico City, told local media, recalling extortion from the cartel.
of Pisocobro“Protection fees,” fees the cartels charge business owners in exchange for “protection,” are a major problem for Mexico City merchants.
“The first group of businesses affected are restaurants, second convenience stores and third jewelry stores,” said José de Jesús Rodríguez, president of the Mexico City Chamber of Commerce.
Extortion has been on the rise in recent years, with some facilities in the area receiving phone calls, emails and in-person visits from armed men demanding fees for cartels.
“The authorities have tried many times, by phone,” restaurant owner Israel Zavala told Mexican media. “There's not much trust in the authorities and complaints have been filed but nothing has progressed.”
The problem with this metric, analyst Saucedo said, is that we never had access to their accounting books.
“Many people don't report them to authorities, so the total amount of taxable fees will never be known.”
Mexico City is home to numerous criminal gangs that are involved in drug trafficking and other activities, as well as collecting extortion payments from small business owners such as tortilla shops, street vendors, and taxi drivers.
“Mexico City is densely populated and has a very large informal economy, so unfortunately a lot of people tend to pay protection money, which makes it a lucrative activity for the local mafia,” Saucedo said.
“Not only do we pay the official tax for coming here to work, we have to pay them another tax,” said Angel Campos, a street vendor in Mexico City.
