Utah Family Charged for $300 Million Stolen Pemex Crude Oil Smuggling Scheme with CJNG Cartel

"Socalj" for Borderland Beat

A Utah family who owns a large oil importation company in Texas is making headlines after being arrested and indicted on federal charges in connection with a scheme to smuggle crude oil from Mexico into the United States.

James Lael Jensen and his wife Kelly were booked into the Salt Lake County Jail after authorities executed an arrest warrant at their $9.1 million mansion. The couple is accused of conspiring to smuggle 2,881 different shipments of crude oil from Mexico. Two of their sons were arrested as well.

According to the indictment, the Jensen family began laundering money and illegally importing crude oil in May 2022. But accusations made by PEMEX in a 2011 lawsuit show James Jensen had been involved in the illegal oil smuggling from Mexican cartels for well over a decade.

Authorities allege that more than $47 million was transferred from businesses operated by James and Kelly Jensen to "Mexican businesses" from 2022 until 2025.

The Jensen's 33,000-sq. ft. home in Sandy, Utah was raided and under forfeiture.

A person close to the situation who requested anonymity due to cartel involvement told KSL 5 TV that the U.S. Marshals Violent Fugitive Apprehension Team showed up at the Jensen's 33,000-square-foot mansion in Sandy, Utah, with a battering ram.

Court documents filed in U.S. District Court in Utah claim that James and Kelly Jensen, along with their two sons, Max and Zachary, conspired to "launder proceeds from the sale of illegally imported crude oil" on behalf of Mexican criminal organizations.

Records indicate that payments for the oil were funneled to businesses in Mexico believed to be controlled by drug cartels, and that James Jensen was aware of these connections.

Stolen Pemex Oil Smuggling & Fraud

The Jensen family owns and operates Arroyo Terminals, a crude oil trading company in Rio Hondo, Texas, a small community about 30 miles north of the U.S.-Mexico border. Federal agents raided their business, Arroyo Terminals, last week, and two days later the company's website was taken offline and placed under government control.

Arroyo Terminals purchased about 7.7 acres near Rio Hondo in 2016, according to a deed filed with the Cameron County Clerk’s Office.

“The company specializes in domestic and cross-border acquisitions of various blends of crude oil,” according to the Arroyo Terminals website. Arroyo Terminals stored the crude oil in large tanks near the Arroyo Colorado. Every few weeks, barges would transport the crude oil to buyers.

From about May 2022 to 2025, James L. Jensen purchased nearly 2,900 shipments of crude oil that had fraudulent customs paperwork, according to the indictment.

“The conspirators that they were working with were working with Mexican criminal organizations in order to get the oil to the Jensens,” Attorney Hess said.

The fraudulent paperwork claimed the crude oil was actually “waste of lube oils” and “petroleum distillates,” according to the indictment. The indictment remained sealed until April 23, when the government raided Arroyo Terminals in Rio Hondo, Texas.

During the raid, agents placed workers in handcuffs and questioned them about the business, according to three employees who spoke with CBS 4 News on the condition of anonymity.

One employee said the FBI asked whether the crude oil was stolen.

“We don’t know about that,” the employee said. “We’re just in charge of unloading the trucks and loading the barges.” Another employee agreed.

“When it comes to the aspect of knowing where this oil’s coming from or what company or what part of Mexico or anything like that, we were always out of the loop,” the employee said.

This wasn't the first time James Jensen had been accused of buying stolen petroleum products.

In a 2011 lawsuit, PEMEX claimed Jensen and two corporations he controlled, Big Star Gathering and St. James Oil, had purchased stolen natural gas condensate. Also included in the lawsuits were oil companies such as ConocoPhillips and Shell.

James L. Jensen

“At times, Jensen would travel to Mexico to arrange purchases from the cartels who had stolen the condensate,” according to the 2011 PEMEX lawsuit.

According to the suit, Big Star, Superior Crude and F&M Transportation knowingly participated in the scheme to import and market the stolen condensate in the United States, according to the complaint, the other defendants "appear to have been innocent and dealt in the condensate only after it was laundered."

Jensen denied any wrongdoing, but he admitted Big Star had business dealings with an oil company executive who sold the stolen natural gas condensate. All the transactions happened before the oil company executive pleaded guilty, according to an affidavit filed in the lawsuit.

Pemex accuses the companies of illegal possession and use of Mexican sovereign property, conversion, unjust enrichment, fraud, breach of warranty, and breach of contract.

Attorneys for Jensen’s company, St. James Oil, urged a judge to dismiss the case.

“St. James’s business reputation and creditworthiness suffer every day that it continues to be named in a lawsuit alleging participation in a drug cartel-related conspiracy,” according to a motion filed in the case.

After two years of litigation, PEMEX dropped the case against Jensen in 2013.

Cartel Money Laundering Links

Maxwell Sterling Jensen, who co-owns Arroyo Terminals with his father since May 2020, and Zachary Golden Jensen, who handled marketing and business development for the company, pleaded not guilty Tuesday afternoon.

They’re accused of participating in a conspiracy to buy stolen crude oil from businesses affiliated with Mexican drug cartels and launder millions in dirty money.

Federal prosecutors allege the family violated the U.S. Tariff Act, allowing the Jensen family to reap huge profits off of a normally highly regulated and highly limited import industry via loads of crude oil stolen from Pemex, the nationalized oil company owned by the Mexican federal government.

“The crude oil that was making its way into the United States was, by necessity, having to be stolen from Pemex, mislabeled, and then delivered into the United States labeled as waste oil,” Assistant U.S. Attorney Michael Eugene Hess explained during a detention hearing. Hess further alleged that the family worked with Mexican organized crime to carry out the scheme.

According to Assistant U.S. Attorney Laura Garcia, Maxwell worked closely with “cartel-affiliated” businesses, Garcia said, and developed connections in Mexico.

He also frequently travels to the Bahamas, where the Jensen family owns a home, Garcia said, and maintains bank accounts. Guerra, the attorney who represents Maxwell, said his client is a hardworking father of five.

“The court is concerned,” Judge Torteya said, about inconsistent information Maxwell provided about his travel to the Bahamas and his use of marijuana and ordered him held without bond.

The fourth charge on the indictment of conspiracy to spend laundered money, targets Kelly. Most notably a cashier's check exceeding $10,000 to Low Book Sales, an automotive dealership.

The final charge of spending laundered proceeds, specifically cites James for allegedly buying a 2024 GMC Sierra Denali pickup truck registered to the company Arroyo Terminals.

Assets That Could Be Forfeited

Among the assets subject to seizure are money deposited in accounts at Wells Fargo and Bank of America, as well as several boats.

Additionally, the properties listed include a 2023 Corvette Stingray, a 2023 Mercedes-Benz, a GMC pickup truck, and two semi-trucks. Also mentioned is a property at 21076 North Reynolds Highway, where Arroyo Terminal is located. Also listed is their multi-million dollar mansion in Sandy, Utah.

“They were unwilling to come out,” Assistant U.S. Attorney Michael Hess said during a hearing on April 24 referring to the Utah raid in which US Marshals arrested James Lael Jensen, who co-owned Arroyo Terminals, and his wife, Kelly Anne Jensen.

That forced the Marshals Service to break down the door, Hess said.

“Mr. Jensen and Mrs. Jensen’s story about that is very different,” said attorney John Huber of Salt Lake City, who represents James Jensen.

James agreed to open the door, Huber said, but the Marshals Service broke it down anyway.

If convicted, the family would be required to forfeit approximately $300 million in assets, including bank accounts and their Texas-based company and all face up to 20 years in prison.

“The company owns and operates its own fleet of 30,000 barrel barges, which gives us unique capabilities to transport and market our crude oil product,” according to the Arroyo Terminals website.

An Instagram photo showed the Jensen's purchasing of the 2024 GMC Sierra Denali Ultimate that is listed as being bought using funds derived by smuggling.

Agents took documents from the Arroyo Terminals building, according to a third employee, and requested passwords for the computers. 

“When I went into the office to use the restroom, I did hear the FBI high-five and say: ‘We got ‘em,’” the employee said.

The Jensen's sons were also arrested, including Zachary Golden Jensen.

Along with Jensen, the grand jury indicted his wife and two of his sons, Maxwell and Zachary.

“They are looking forward to receiving the discovery and asserting their innocence in court,” said attorney Robert Louis Guerra of Brownsville, who represents Maxwell.

Huber asked the judge to release James while he awaits trial.

“They’re active in their church. They’re active in their community. They come from a stalwart Utah family,” Huber said. “His in-laws have served in public service for decades and they don’t want to throw that all out of the window.”

Kelly Jensen’s father, Gordon Walker, served in the U.S. Department of Housing and Urban Development during President Ronald Reagan’s administration. Her mother, Carlene Walker, served in the Utah State Senate. James Jensen graduated from BYU, Brigham Young University.

Although prosecutors requested that James Jensen be held without bail due to flight risk, he was released from jail on April 25 under GPS monitoring. Similarly, Kelly Jensen was also released from federal custody under conditions that included surrendering her passport.

Torteya set bond for Zachary at $100,000 and ordered him to remain at home in Utah and submit to GPS monitoring. Torteya, ordered Maxwell held without bond.

Sources KSL5, Valley Central, Courthouse News, My San Antonio

Categories: CJNG, Huachicol, texas