Think Tank Warns $4 Billion of US Remittances to Mexico Could Be Linked to Crime

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Bloomberg — Nearly 8% of the record $58 billion that Mexicans mainly living in the US sent home last year appear to be linked to illegal activities, including money laundering, according to a new report by a Mexico-based data think tank.

Remittances to Mexico have been booming in recent years due to new migration to its northern neighbor but at least $4.4 billion of such transfers could be linked to criminal activity, Signos Vitales, a think tank that groups researchers who analyze public data in Mexico, said in a report on Monday.

Red flags include rising remittances from areas that host a relatively small Mexican immigrant population and others that received more dollar transfers per month than the number of households, according to the report. The researchers also highlight remittances that come from unknown locations.

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“There has to be an explanation for the astounding increase in the past few years. It’s impressive that it’s gone from around $21 billion to nearly $60 billion,” said Enrique Cardenas, an economics professor who leads Signos Vitales. “There are parts that look strange, things that don’t happen in the rest of the country.”

Minnesota, which according to recent population data had a Mexican-origin population of only about 200,000 people, was the US state with the third highest number of transfers to Mexico in 2022. In over 200 municipalities in Mexico, the number of transfers was greater than the total of households estimated to exist in the area, suggesting an improbable 100% of them are receiving money from abroad, the report says.

Remittances to Mexico from workers living abroad almost tripled to a record $58.5 billion last year, compared to just above $22 billion a decade before. The money flows aided Latin America’s second-largest economy during the pandemic, allowing Mexican families to continue covering their expenses despite limited public aid and a contraction in activity.