MEXICO CITY — In a small town in the western Mexican state of Michoacán, members of a criminal group forced residents to pay for expensive internet service — or face death.
Following these threats, residents made monthly extortion payments while simultaneously reporting the situation to the authorities.
After months of investigation, authorities raided three properties and found evidence such as antennas, internet repeater equipment and connections, which were handed over to the prosecutor’s office.
Although it may seem surprising that Mexican drug cartels are involved in Internet services, those who follow the activities of these criminal groups are not at all surprised.
“Drug cartels have diversified their operations since their inception,” said security analyst David Saucedo. “Many of them started out as criminal organizations whose primary business was not drug trafficking.”
Some gangs were involved, for example, in fuel theft, others in vehicle theft and still others specialized in public transportation theft, Saucedo said.
“The criminal groups that joined the drug trade already had these other activities before.”
In addition to the billions of dollars the cartels make from drug trafficking, the U.S. Drug Enforcement Administration (DEA) says the most powerful drug cartels, Sinaloa and Jalisco New Generation (CJNG), are involved in numerous illegal businesses that generate profits.
“The Sinaloa Cartel is closely associated with drug trafficking, but 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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The CJNG orders fuel theft from pipelines, extorts agave and avocado growers, migrants and prison officials, and taxes migrant smugglers, the report said.
“The portfolio is vast. However, although drug trafficking is the most profitable activity, its investment recovery period is longer than that of other criminal activities, which generate almost immediate profit,” Saucedo said.
From cartels calling older Americans to offer them timeshares in Mexico, resulting in a loss of nearly $40 million, to cartel-backed smugglers reaping growing profits from trafficking migrants across the U.S.-Mexico border, their criminal scope is vast.
Here are some ways the cartels have expanded their influence:
Fuel theft
Fuel theft, known as Huachicoleo In Mexico, drug trafficking is a very lucrative business 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 trafficking.
Mexican cartels have developed a sophisticated approach to fuel theft that involves corruption, precision and violence.
These practices include tactics such as bribing Pemex employees and local officials to obtain information, drilling specific illegal taps into pipelines, and using modified tanker trucks to transport stolen fuel for distribution through black market networks.
Several cartels are involved in this criminal activity. For example, the Santa Rosa de Lima Cartel, led by José Antonio Yepez, also known as El Marro, established its dominance through fuel theft before moving into drug trafficking.
Additionally, CJNG and the Gulf Cartel are also linked to fuel theft, which supports their criminal activities.
Lawyers
Mexico’s multi-billion dollar avocado industry, which continues to break export records each year, is also a major target for drug cartels.
In Mexico, avocados are known as “green gold” and the country has become the world’s largest producer of this popular fruit.
But as the producers’ fortunes have grown, they have faced increasing threats from drug cartels seeking a share of the profits.
In Michoacán, the only state authorized to export these fruits to the United States, the CJNG and local gangs demand payments from farmers, often called “protection fees.”
These fees can range from $135 to $500 per hectare per month, depending on the size of the operation and the perceived level of threat.
The extortion process begins when cartels identify and target profitable farms. Armed cartel members then approach farmers and threaten them with violence or property damage if they refuse to comply.
In February 2022, the United States suspended imports of avocados from Mexico after a U.S. official received a death threat while working in Uruapan.
Imports resumed a week later following new security measures implemented by the Mexican government in the region.
Two years later, residents say the situation has not changed much and avocado growers continue to face criminal organizations in the area.
Tortillas
According to the Mexican Ministry of Agriculture, a Mexican consumes an average of 70 kilos of tortillas per year. It is a staple of Mexican cuisine, and that is why the cartels have decided to take advantage of it.
The cartels’ extortion affects nearly 20,000 tortillerías, which has a direct impact on the prices paid by Mexicans.
According to the National Tortilla Council, in an interview with the Washington Post, of the more than 130,000 tortillerías in the country, between 14 and 15% suffer from extortion.
Homero López García, president of the organization, told El Sol de México that the establishments must pay between $135 and $190 per week to several criminal groups to continue operating.
“Well, nothing surprises me anymore,” Saucedo, the security analyst, said of cartels extorting tortillerías. “Maybe it’s a bit of an insensitive and cynical attitude on my part, but the truth is that I remain open to all possibilities on this subject.”
Chicken
In a video posted on social media two days before Christmas 2023, an armed group is seen arriving at a poultry store in Toluca, Mexico, kidnapping four workers and putting them in a white van.
The Mexico State Public Ministry said the victims were merchants who were forced to buy chicken from certain establishments. They also had to pay a tax of $2.50 per kilo in exchange for not being killed by the Familia Michoacana cartel.
Authorities said that as a result of their efforts to combat extortion, the criminal groups La Familia Michoacana and CJNG lost more than $43 million by threatening poultry and egg sellers in municipalities in the Toluca Valley and the south of the state.
The state prosecutor’s office said that in 2023 alone it received 4,010 complaints of the crime, of which it determined that only one in four were filed in person, with the rest being indirect through phone calls, social media and emails.
Three months later, the four workers kidnapped in December have been found alive and the four perpetrators have been arrested, but the kidnappers remain at large and extortion of poultry sellers continues, authorities said.
“Piso” Fees
“They were asking me for $600 a month for hardwood floor“We reported it and we had to close for a month,” Guillermo, a businessman from downtown Mexico City, told local media, recalling the extortion he suffered at the hands of the cartel.
THE hardwood floorThe main problem for Mexico City’s traders is the fees that cartels charge merchants in exchange for “protection.”
“The first group of businesses affected are restaurants, followed by convenience stores in second place, and then jewelry stores in third place,” said José de Jesus Rodriguez, president of the Mexico City Chamber of Commerce.
In recent years, extortion has increased. Depending on the region, some establishments received calls, emails or in-person visits from armed men demanding fees from the cartel.
“They have tried several times, by phone,” restaurant owner Israel Zavala told Mexican media. “There is not much trust in the authorities. Complaints have been filed, but they are not being processed.”
Analyst Saucedo said the problem with the measures is that we have never had access to their accounting books.
“We will never have the full amount of tax due because many do not declare it to the authorities.”
In Mexico City, many criminal organizations engage in activities such as drug trafficking, but also charge extortion fees to small business owners such as tortilla shops, street vendors and taxi drivers.
“Since Mexico City is a densely populated area and we have a very large informal economy, unfortunately many people are likely to pay money for protection. Therefore, it is a profitable activity for local mafias,” Saucedo said.
“In addition to paying an official tax to come to work, you have to pay another one,” explains Angel Campos, a vendor at a street market in Mexico City.
