Latin America continues to face entrenched challenges in the fight against corruption. A long history of state-owned enterprises, significant government intervention, and weak institutional controls has made the region a recurrent focus of U.S. enforcement authorities. After a period of reduced enforcement, the Department of Justice (DOJ) has renewed its focus, illustrated by the first post-pause Foreign Corrupt Practices Act case against Mexican individuals for a bribery scheme. This case signals a strategic shift aimed at protecting U.S. interests and the U.S. economy. Latin American countries are therefore expected to remain under scrutiny.
Recent U.S. policy developments reinforce this focus. Revised DOJ guidelines emphasize foreign bribery involving cartels or state-owned entities – both prevalent in Latin America. Prosecutors note that this means continued enforcement attention on countries where cartel activity remains significant.
According to Transparency International’s Corruption Perceptions Index (CPI), most Latin American countries continue to rank below the global average, reflecting persistent structural challenges. For companies operating or investing in the region, this environment presents regulatory and reputational risks. Strengthening compliance programs, ensuring effective monitoring of intermediaries, and fostering a culture of transparency are essential to mitigate exposure and meet the rising expectations of enforcement authorities. At the same time, several Latin American countries have continued to advance in this field, with notable regional developments outlined below.
Cartels, compliance, and the new reality of doing business in Mexico
Mexico scored 26 out of 100 in the CPI 2024, ranking 140th out of 180 countries. Beyond the number itself, the score reflects a broader reality: high perceived corruption in the public sector and a persistent weakness in enforcement capacity.
This picture becomes even more complex once recent actions by the United States are considered. In early 2025, through Executive Orders, the U.S. government designated some Mexican cartels as Foreign Terrorist Organizations (FTOs). These orders changed how the groups were treated: they were no longer viewed as just “organized crime,” but as national security and counterterrorism threats.
In June 2025, DOJ issued its Guidelines for Investigations and Enforcement of the Foreign Corrupt Practices Act, which identified Mexican cartels and protecting U.S. economic interests as priorities. Similarly in June 2025, the U.S. Financial Crimes Enforcement Network (FinCEN) issued actions against three Mexican financial institutions – CIBanco, Intercam, and Vector – classifying them as primary money-laundering concerns tied to fentanyl-related activity.
Taken together, this new landscape has changed how Mexico’s corruption and compliance risks are viewed. The discussion has moved beyond corruption and organized crime to include cartels treated as terrorist organizations, fentanyl-related activity, and the way financial institutions may be drawn into these issues. This shift opens the door for companies to reassess internal vulnerabilities, strengthen compliance cultures, and position themselves ahead of regulatory and geopolitical expectations.
The first post-pause enforcement action came in August 2025, when DOJ unsealed an indictment involving a bribery scheme connected to contracts with PEMEX, Mexico’s state-owned oil company. And in November 2025, a Mexican gas services company became the first U.S. company to disclose potential payments to local government officials in Mexico that may have benefited FTOs.
Extortion remains one of the most persistent risks for companies in Mexico, with “derecho de piso,” or extortion, payments affecting entire value chains, from farmers to transporters and local businesses. Though the government launched a National Strategy Against Extortion in July 2025, implementation is uneven. These extortion payments often end up recorded as “community support,” “security services,” or “union fees,” which complicates detection and internal investigations.
The pressure isn’t limited to criminal groups. Companies may also face requests from “ejidos,” or local leaders, for “donations” to secure access or maintain peace. Some may be legitimate, but others function as channels for criminal or political leverage. These payments now need to be understood as potentially making extortion payments to terrorist organizations. Along logistics corridors, extortion has a direct financial impact. Companies report increases of 3 to 7 percent in transport costs attributed solely to these pressures, ranging from forced fuel purchases to mandatory use of cartel-controlled carriers.
Against this background, the legal expectations around compliance are also rising. A 2025 Mexican Supreme Court ruling made one point clear: when a company adopts a compliance program, especially one involving supplier selection, due diligence, or internal controls, those commitments can become legally enforceable. This brings Mexico closer to international practice and shows that compliance is no longer just a foreign expectation, but something local courts and regulators are prepared to uphold.
Mexico’s 2025 reform to its AML Law significantly raised compliance expectations by increasing fines, expanding “vulnerable activities” (including real estate, construction, and virtual assets), strengthening ultimate beneficial owner and politically exposed person definitions, and requiring automated monitoring, risk-based programs, 10-year recordkeeping, and a designated, trained compliance officer. These changes bring Mexican enforcement much closer to international standards.[1]
President Claudia Sheinbaum’s 2025–2030 Program for Anti-Corruption puts transparency, customs oversight, and federal-fund controls at the top of the agenda. But these commitments arrive at the same time that several independent oversight agencies are being eliminated. For the private sector, this contradiction is impossible to ignore. On one hand, the government promises cleaner institutions; on the other, it’s removing the very bodies designed to keep power in check.
For companies, the main point is that the coming years will bring higher expectations with fewer external reference points. As Mexico reorganizes its oversight structure while advancing new anti-corruption priorities, businesses will need to be clearer about how they assess risk, document decisions, and justify their compliance judgments. Realistically, this means relying less on formal guidance and more on internal criteria and practical decision-making that can withstand scrutiny.
Brazil rethinks corporate accountability after fall in global rankings
In 2024, Brazil scored 34 out of 100 in the CPI, marking a decline compared with its 2023 score of 36. Transparency International pointed out that this indicates a rollback in anti-corruption efforts and represents a growing state capture by corruption, with organized crime gaining explicit influence within public institutions. It issued an urgent warning: this trend should serve as an alarm for Brazilian society and institutions to act decisively to reverse this deeply troubling trajectory.
The organization added that 2024 was marked by significant setbacks, with the president avoiding the topic of corruption, the judiciary exposing impunity for powerful offenders, and Congress continuing to undermine the public budget. This ranking and statement reflect growing concern over corruption risk, highlighting the need for renewed commitment from both the public and the private sectors to build trust and reinforce integrity across all levels of business.
Despite the CPI ranking, Brazil has seen important developments in the fight against corruption, reflecting a commitment by the public sector to improve the country’s standing domestically and internationally. In response to concerns regarding the effectiveness of enforcement, Congress is discussing Bill No. 686/25 (the Bill), introduced in February 2025, which proposes a new approach designed to foster a compliance culture in Brazilian companies.
The Bill would grant exemptions from criminal and administrative liability to companies that can show effective integrity and compliance programs. It signals a shift from a model centered solely on penalties to one that rewards proactive compliance. This approach aligns with the principles established in leniency agreements and brings Brazil closer to international best practices.
Another relevant development relates to better coordination among public authorities. Over the years, Brazil has been criticized for its decentralized system in which enforcement responsibilities are distributed across the executive, legislative, and judicial branches. While the Office of the Comptroller General (CGU) acts as the federal gatekeeper for anti-corruption enforcement, differences in interpretation and practice among public authorities – such as the Public Prosecutor’s Office or the Federal Police, which also investigate misconduct and can enter into leniency agreements – have led to inconsistent standards or jurisdiction overlap.
To address this concern, in April 2025, the CGU, the Office of the Attorney General (AGU), and the Federal Prosecution Service (MPF) signed a cooperation agreement[2] aimed at harmonizing procedures and streamlining leniency negotiations under the Anti-Corruption Law No. 12,846/2013. This initiative will ensure greater legal certainty in leniency agreements through shared protocols, information exchange, and mechanisms to resolve institutional conflicts.
This collaborative approach was put into practice in July 2025, when the CGU and the AGU signed a leniency agreement with a Singapore-based energy and shipbuilding company. During the negotiations, the company’s compliance program was accessed, and the company agreed to further enhance its compliance procedures in addition to paying the required penalties. The settlement showed Brazil’s capacity to handle complex cross-border investigations and reinforced its commitment to international cooperation in anti-corruption enforcement.
By September 2025, Brazil registered a record number of anti-corruption investigations led by the CGU and the Federal Police – over 40, exceeding the combined results of previous years. According to the CGU’s head, this milestone reflects the stronger participation and coordination among government enforcement authorities.
In October 2025, a new law was enacted (Law No. 15,245/2025) to fight organized crime. It criminalizes soliciting or hiring a member of a criminal association to commit a crime and introduces additional protection for public officials and their families who are involved in combating criminal organizations. The new law also introduces criminal offenses related to obstruction and conspiracy to obstruct police or judicial actions and establishes measures to ensure greater protection for those involved in the fight against organized crime, in line with DOJ’s similar efforts and focus.
Collectively, these developments illustrate a dynamic landscape in which an effort to strengthen enforcement, foster institutional cooperation, and emerging compliance incentives coexist with ongoing challenges. This evolving environment is shaping the future of corporate integrity in Brazil.
References
1. In 2025, OFAC intensified actions against Mexican individuals and companies linked to cartels and fentanyl-related activity, with FinCEN following closely, reinforcing heightened KYC, screening, and red-flag expectations.
2. See further details in Acordo de Cooperação Técnica CGU/AGU/MPF de 25 de abril de 2025.