CIBanco Sues US Treasury After US Financial System Cutoff

CIBanco has filed a civil lawsuit in a US federal court against the Department of the Treasury, challenging a decision that cut off its access to the US financial system over alleged money-laundering activities linked to drug trafficking.

The lawsuit, filed in Washington, argues that the measure constitutes an illegal sanction violating due process and the presumption of innocence. The bank claims the order threatens its survival by preventing it from defending itself and has requested the court to suspend the sanction, at least temporarily.

The case dates to June, when the Treasury’s Financial Crimes Enforcement Network (FinCEN) sanctioned three Mexican financial institutions for allegedly laundering assets for Mexican cartels classified as terrorist organizations. The sanctions prohibited the banks from accessing the US financial system and barred US entities from doing business with them.

CIBanco stated that it was never given notice or the opportunity to review the evidence. The complaint asserts that the order lacks details and that FinCEN declined to share information necessary for a defense. It adds that the allegations are vague and fail to identify individuals, accounts, or transactions related to opioid trafficking.

The bank claims the order has already caused significant disruptions. Visa terminated its relationship with CIBanco on June 30, affecting approximately 220,000 debit and prepaid cards. About 150,000 prepaid cards stopped working, and 70,000 debit cards were blocked for international use.

CIBanco also reported that it holds fiduciary accounts in approximately 10 US financial institutions with a combined balance exceeding US$38 million (MX$715 million). Many of these accounts are now inaccessible, leaving trust beneficiaries without access to their funds.

The bank warned that its potential collapse could harm thousands of third parties, including depositors, US investors, and public-sector employees whose pension funds depend on the bank’s fiduciary services. It added that more than 3,000 employees could lose their jobs if operations are suspended.

CIBanco is asking the court to suspend the Treasury’s order and require the agency to reverse related actions. The bank also seeks damages for losses incurred.