U.S. Indictment of Sinaloa’s Governor Carries Risk for Companies Operating in Mexico

The Second Trump Administration continues to use a variety of tools to target individuals and companies with suspected links to cartels and transnational criminal organizations (TCOs) in Latin America, including economic sanctions, foreign terrorist organization (FTO) designations, and criminal prosecutions. On April 29, 2026, federal prosecutors in the Southern District of New York indicted Rubén Rocha Moya (Rocha Moya)—the Governor of Sinaloa and a member of President Claudia Sheinbaum’s political party—and nine other current and former Mexican government officials on drug- and weapons-trafficking charges.[1]

The indictment marks the first time the United States has charged a sitting Mexican Governor,[2] and represents a significant escalation in the United States’ enforcement efforts that has the potential to expose multinational corporations operating in Mexico to increased governmental scrutiny; criminal and civil liability under U.S. sanctions, anti-terrorism, anti-bribery, and anti-money laundering laws; as well as significant reputational harm.

The Rocha Moya Indictment

The indictment alleges that—in exchange for bribes and other political favors—Rocha Moya and the other government officials furthered the Sinaloa Cartel’s activities by protecting them from investigation or prosecution and directing police departments to safeguard drug and weapons shipments. The U.S. State Department designated the Sinaloa Cartel as an FTO on February 20, 2025, calling it “one of the world’s most powerful drug cartels and [] one of the largest producers and traffickers of fentanyl and other illicit drugs to the United States.” 

The charges follow two recent high-profile actions taken by the Trump Administration against Latin American officials. First, in January 2026, U.S. authorities captured Venezuelan President Nicolás Maduro for allegedly engaging in narcoterrorism. Then, in March 2026, media reports suggested that federal prosecutors in New York are investigating Colombian President Gustavo Petro and his associates for narcotrafficking. (For further background on the Petro investigation, please see our prior blog post.) On May 15, 2026, the New York Times also reported that the Trump Administration is urging federal prosecutors to increase the number of indictments against Mexican officials threefold.

Implications

As we have previously noted, although Mexico presents opportunities for foreign investment, Rocha Moya’s indictment reinforces the significant legal, economic, and reputational risk that companies must navigate when interacting with a Mexican government official, either directly or through a third-party.

For example, the Anti-Terrorism Act (ATA), codified at 18 U.S.C. § 2333, provides a civil cause of action for any U.S. national injured during an act of international terrorism and allows plaintiffs to recover treble damages. It is often difficult for plaintiffs to prevail on a direct liability claim against corporate defendants because they must prove that the defendant itself committed an act of international terrorism and that that act was the proximate cause of the plaintiffs’ injuries.  Adding to the burden a plaintiff must surmount, a party commits an act of terrorism only where it engaged in “violent acts or acts dangerous to human life” that would qualify as a criminal act under U.S. law and that are intended to “intimidate or coerce a civilian population”’; “influence the policy of a government by intimidation or coercion”; or “affect the conduct of a government by mass destruction, assassination, or kidnapping.” 18 U.S.C. § 2331(1)(B).

While plaintiffs have encountered repeated difficulty bringing primary liability claims against international companies, plaintiffs have been more successful in advancing secondary liability theories. The ATA allows plaintiffs to hold defendants accountable for conspiring with an FTO or “aiding-and-abetting” its conduct. Guided by the U.S. Supreme Court’s decision in Twitter, Inc. v. Taamneh, 598 U.S. 471 (2023), the D.C. Circuit recently held that when there is “no meaningful distinction” between a government agency and a terrorist group, parties who knowingly provide substantial assistance to the agency with awareness of its terrorist character can face secondary civil liability risk under 18 U.S.C. § 2333(d)(2). Atchley, 165 F.4th 592 (D.C. Cir. 2026).

Moreover, 18 U.S.C. § 2339B imposes criminal liability if an organization (or one of its agents) knowingly provides “material support” to an FTO.[3] “Material support” is interpreted broadly; it not only includes real and personal property, but also protection payments, financial services, training, and other expert advice or assistance. 

Companies also may face heightened scrutiny under the Foreign Corrupt Practices Act (FCPA). We previously discussed that the Trump Administration’s June 9, 2025 FCPA Guidance specifically focuses on the elimination of cartels and TCOs through FCPA enforcement. (The anti-bribery provisions prohibit individuals, businesses, and their agents from corruptly making payments to foreign (i.e., non-U.S.) government officials to obtain or retain business. The FCPA’s books and records provisions also require U.S. “issuers” and their agents to create and maintain accurate books and records and internal accounting controls.) 

Organizations that operate in regions with FTOs could also be exposed to potential violations of U.S. sanctions and anti-money laundering laws.

Proactive Compliance Considerations

Depending on the controls it already has in place, a company operating in Mexico (and Latin America more broadly) could undertake a variety of precautions to reduce the legal risks stemming from heightened scrutiny of FTOs in the region, including: 

• Risk-Based Due Diligence: Companies should consider investigating partners, customers, and third-party intermediaries—including subcontractors, logistics providers, distributors, and consultants—particularly those that potentially interface with government officials or cartels. Recent enforcement trends signal that, depending on the circumstances, regulators may take a dim view of routine, surface-level screenings when more robust options are available. For example, in some circumstances, it may be prudent for companies to engage local counsel that is familiar with the public records systems in the specific jurisdiction.
• Financial Controls and Contract Terms: Entities investing in Latin America might also consider the maturity of their financial controls and whether it would be appropriate to implement enhancements, as well as the robustness of any standard counterparty contractual terms. This may include not only updating contracts and payment terms to require transparency (if appropriate), but also adding inspection rights and suspension clauses in the event that an investigation flags ties to a government official or an FTO.
• Develop Comprehensive Escalation and Disclosure Protocols: The Department of Justice’s March 11, 2026 Corporate Enforcement Policy, which we examined here, creates strong incentives for organizations to make voluntary and timely disclosures to reduce or avoid criminal liability. Depending on the particular risks, a company might train its employees on the risks associated with FTOs and how to report potential concerns, and also develop procedures to investigate alleged misconduct in order to be in a position to make disclosures to the relevant authorities in a timely way.
• Continuously Monitor Developments: Given the dynamic enforcement landscape, additional FTO and sanctions designations are likely. Staying abreast of changes in the law is critical to managing legal and reputational risks.

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This blog post is part of an ongoing series exploring the legal, commercial, and strategic complexities of operating in conflict zones and high-risk jurisdictions. Contributors to this series include Freshfields attorneys Piusha Bose, Eric Bruce, Kate Cooper, Tim Harkness, Tim Howard, Joshua Kelly, Sylvia Noury, Alexandra van der Meulen, Paige von Meheren, Carsten Wendler, Nabeel Yousef, Kim Zelnick, Matthew Haggans, Peter Linken, Justin Simeone, Maria Slobodchikova, Andrew Bulovsky, Allison Kowalski, Ian Allen, Sasha Aristotle, Omeed Askary, Heather Cameron, Elischke de Villiers, Karen Laska, Ian Maurer, Jordan McGuffee, Jackson Myers, Paloma Palmer, Keian Razipour, Miguel Serrano, and Sabrina Zhang. Stay tuned for upcoming posts, and please reach out with topics, questions, or experiences you’d like us to cover as part of this ongoing conversation. 

For a collection of related previous posts and webinars, please click this link.