The U.S. Treasury Department has sanctioned a dozen Mexico-based companies, as well as eight people running them, for allegedly supplying chemicals used in fentanyl to Mexico’s Sinaloa Cartel. The entities were accused of using their chemical, cleaning, laboratory, pharmaceutical and real estate firms to buy the precursor chemicals and turn them over to the cartel’s Chapitos faction, run by sons of former Sinaloa Cartel leader Joaquín “El Chapo” Guzmán. The sanctions, announced October 6, 2025, freeze all company assets in the U.S. and block U.S. transactions with those companies and people.
One chemical and laboratory equipment company, Sumilab, headquartered in Culiacán, Sinaloa, Mexico, already had been sanctioned by the U.S. in May 2023. Afterward, the Favela Lopez family, which runs the business, “removed signage from Sumilab storefronts and changed tactics, but remained heavily engaged in supplying precursor chemicals for the Sinaloa Cartel’s fentanyl production,” the Treasury Department said in a news release.
Sumilab maintained its corporate structure through several other front companies, Treasury officials said. Among the other companies sanctioned were Agrolaren, Viand, Favelab, Fagalab, Qui Lab, Storelab and Macerlab.
The Sinaloa Cartel is among a growing number of Latin American transnational criminal organizations that the U.S. has designated as foreign terrorist organizations. The cartels differ somewhat from previously designated foreign terrorist organizations because they’re largely nonpolitical and more focused on profit. However, many of the cartels have carried out political assassinations in Mexico and killings in the United States to protect their illegal businesses and consolidate their territory.
“President [Donald] Trump has made clear that stopping the deadly flow of drugs into our country is a top national security priority,” Undersecretary for Terrorism and Financial Intelligence John K. Hurley said in the Treasury news release. “The Treasury Department is committed to dismantling the complex financial networks that support these terrorist organizations.”
Trump has declared drug cartels to be unlawful combatants and says the United States is now in an “armed conflict” with them, according to a White House memo obtained by The Associated Press on October 2. “The President determined that the United States is in a non-international armed conflict with these designated terrorist organizations,” the memo says. Trump directed the Pentagon to “conduct operations against them pursuant to the law of armed conflict.”
In testimony before the Senate Armed Services Committee on February 13, 2025, Gen. Gregory M. Guillot, commander of U.S. Northern Command (USNORTHCOM) and the North American Aerospace Defense Command, said: “Transnational criminal organizations based in Mexico continue to threaten U.S. sovereignty and territorial integrity through the production and trafficking of fentanyl and other illicit drugs and the facilitation of unlawful mass migration toward the U.S. southern border. Drug-related violence has escalated in recent years as rival cartels fight for control of lucrative drug and migrant smuggling routes and demonstrate a growing willingness to directly engage Mexican security forces, increasing the risk of spillover violence into the United States.”