Mexico’s Supreme Court upheld the constitutionality of the procedure allowing individuals and legal entities to be included in the Blocked Persons List when sufficient indications of illicit transactions exist, subject to a subsequent hearing and defense mechanism.
On April 6, 2026, the Plenary of Mexico’s Supreme Court of Justice (“SCJN”) upheld the validity of Article 116 Bis 2 of the Credit Institutions Law, which governs the procedure under which an individual or legal entity may be included in the Blocked Persons List when sufficient indications exist of a possible connection with money laundering, terrorist financing or related offenses.
The SCJN held that the account-blocking mechanism established under this framework is an administrative and preventive measure designed to protect the financial system rather than a criminal sanction. Under this standard, the measure may be imposed without prior judicial authorization, provided that the authority documents the relevant risk indicators, duly grounds and explains the inclusion in the list, and respects the statutory defense procedure.
The ruling also confirms the constitutionality of the hearing mechanism introduced through the 2022 reform. Under this procedure, the financial institution notifies the customer that the accounts have been blocked and communicates the reasons for the measure. Following notification, the affected person may request a hearing before the Financial Intelligence Unit (“UIF”) within five days and subsequently submit evidence to rebut the authority’s concerns within the applicable statutory period.
The Court concluded that the procedure protects the right of defense by establishing defined deadlines, the opportunity to submit evidence, the authority’s obligation to issue a duly reasoned decision and the possibility of challenging that decision before the competent courts. The SCJN also held that the UIF’s authority is not limited to cases arising from express requests by foreign authorities, thereby discontinuing previous precedents that had imposed that requirement.
For financial institutions, the decision reinforces the importance of maintaining clear internal procedures to execute and notify account-blocking measures promptly, preserve the corresponding records and respond to requirements arising from the inclusion of customers in the Blocked Persons List.
For companies and compliance officers, the ruling underscores the importance of robust anti-money laundering and counter-terrorist financing programs, together with controls capable of demonstrating the traceability of transactions, counterparties and funds.
The short deadlines available to exercise defense rights make it particularly important for organizations to maintain financial and corporate information in an organized and readily accessible manner. If an account block occurs, the ability to quickly identify the origin and destination of funds, reconstruct transactions and provide sufficient documentary evidence may be critical to responding within the applicable legal deadlines.
From a practical perspective, the SCJN ruling confirms three central points:
• Account blocking under this framework is administrative and preventive in nature, rather than criminal, and may be imposed without a prior judicial order when sufficient indications exist under the applicable law.
• The clarification and hearing procedure established in Article 116 Bis 2 of the Credit Institutions Law was found consistent with the rights of defense and legal certainty.
• Financial institutions’ role in notifying customers and materially implementing the block forms part of the statutory cooperation framework and does not, by itself, make them authorities within the proceeding.
For companies, financial institutions and compliance officers, the decision reinforces the need to review due diligence procedures, customer and counterparty screening, beneficial ownership identification, transaction monitoring and document-retention practices. An effective compliance framework not only helps reduce exposure to high-risk transactions but also facilitates a timely response if an account-blocking measure is imposed.
Von Wobeser y Sierra is available to assist with strengthening compliance and anti-money laundering programs, as well as with the analysis and handling of proceedings related to the Blocked Persons List.
