OFAC Action Highlights the Financial Crime Risks Linked to Cocaine Transhipment Routes

On 22 January 2026, the Office of Foreign Assets Control OFAC announced the designation of five Costa Rican nationals and five Costa Rica-based entities for their involvement in large-scale narcotics trafficking and money laundering. The action targets one of the most significant cocaine trafficking networks operating in the Caribbean and Central America, with direct supply routes to the United States and Europe.

The designations form part of a sustained US government effort to disrupt the entire drug trafficking supply chain, including logistics facilitators, enablers, and financial networks.

Costa Rica as a Key Cocaine Transhipment Hub

Costa Rica has increasingly emerged as a strategic transhipment point for cocaine moving from Colombia to international markets. Since the opening of the Moín seaport in Limón in 2019, criminal organizations have competed violently for control of port access, container routes, and surrounding territory.

US and Costa Rican authorities have linked the rise in drug-related violence in Costa Rica directly to the expansion of transnational drug trafficking networks seeking to exploit maritime shipping routes.

The Picado Grijalba Organization

The network designated on 22 January 2026 is led by Luis Manuel Picado Grijalba, also known as “Shock”, and his brother Jordie Kevin Picado Grijalba, known as “Noni”.

According to OFAC, the organization was responsible for:

• Transporting multi-ton quantities of cocaine from Colombia
• Storing cocaine in warehouses throughout Costa Rica
• Shipping cocaine onward to the United States and Europe
• Laundering illicit proceeds through layered financial and commercial structures

Luis Manuel Picado Grijalba is described as one of the most prolific drug traffickers operating in the Caribbean. He was arrested in the United Kingdom in December 2024 and is currently held pending a final extradition decision to the United States. Jordie Kevin Picado Grijalba was arrested in Costa Rica in August 2025 and is also awaiting extradition.

Links to Violence and Organized Crime

The Picado Grijalba network expanded its influence by forming alliances with other major traffickers and violent criminal groups. OFAC identified close ties to armed groups, including a gang of hired assassins controlled by Tonny Alexander Pena Russell.

Pena Russell was arrested in 2024 and charged with 78 counts of murder, many allegedly carried out on the orders of Shock. In November 2025, Costa Rican police launched a large-scale operation targeting the organization, resulting in:

• The arrest of 30 individuals
• The seizure of approximately 14 tons of drugs
• The confiscation of luxury assets linked to drug proceeds

A Family-Run Money Laundering Network

A notable feature of this case is the use of close family members to launder illicit proceeds. OFAC identified that Shock’s wife Estefania McDonald Rodriguez and his mother in law Anita Yorleny McDonald Rodriguez used businesses under their control to move and disguise drug trafficking profits.

These activities included the use of commercial entities and the notarization of fraudulent transactions to legitimize illicit funds. Several of the businesses involved were temporarily suspended by Costa Rican authorities due to their links to drug trafficking and money laundering.

Legal Basis for the Designations

All individuals and entities were designated pursuant to Executive Order 14059, which targets the proliferation of illicit drugs and their means of production. The action reflects close coordination between OFAC, the Drug Enforcement Administration, Homeland Security Task Forces, and multiple Costa Rican law enforcement and intelligence agencies.

US Treasury officials emphasized that sanctions will continue to target the entire narcotics supply chain, from transport facilitators to money launderers.

Sanctions Implications for Financial Institutions

As a result of the designations:

• All property and interests in property of the designated persons within US jurisdiction are blocked
• US persons are prohibited from engaging in transactions involving the designated individuals or entities
• Entities owned 50 percent or more by blocked persons are also considered blocked
• Violations may result in civil or criminal penalties under a strict liability standard

Non-US persons may also face sanctions exposure if they cause or facilitate violations of US sanctions.

Compliance Lessons for Sanctions and AML Programs

This case reinforces several key compliance themes:

• Drug trafficking networks rely heavily on financial and commercial enablers
• Family members and legitimate businesses are frequently used to launder proceeds
• Maritime and trade routes present heightened sanctions and AML risk
• Sanctions screening must capture ownership, control, and indirect exposure

Institutions with exposure to high risk jurisdictions, trade finance, or maritime logistics should ensure that sanctions and AML frameworks adequately address these risks.