There was nothing unusual about the fresas, or preppy rich kids, who used to order liquor by the bottle and dance to electronic beats behind the stone and glass façade of Guadalajara's trendy Lucrecia nightclub. But the first indication that something untoward was happening at the club came in March 2013, when unidentified customers shot the head waiter eight times on their way out.

The shooting drew unwelcome attention to Lucrecia. Thirteen months later, the US government blacklisted it for allegedly laundering dirty money on behalf of veteran drug cartel capo Rafael Caro Quintero.

The bar finally closed down in January this year, saying with a Facebook post: "Legends never die!" But there are plenty of other places in Guadalajara, Mexico's second largest city, that are believed to be helping drug gangs launder their illicit profits.

Consequently, Tapatios, as Guadalajara natives are known, can never be sure when they shop, eat, drink, dance, fill up their gas tanks, or even pay their rent that they may be inadvertently helping the Jalisco New Generation cartel and other gangs that have terrorized the population and paralyzed the city with narco-blockades.

As of June of this year, the US government has blacklisted Guadalajara-based restaurants, bars, malls, health spas, shoe stores, residential communities, construction firms, gas stations, pawn shops, tequila companies, and even an ostrich farm for laundering drug cash.

Tackling money laundering and the web of corruption that facilitates it poses one of the toughest challenges facing Guadalajara's mayor-elect, Enrique Alfaro of the liberal Citizens Movement. Alfaro won a historic landslide victory over the ruling Institutional Revolutionary Party in last Sunday's midterm election.

"In many cases drug trafficking is linked to famous Mexican businesses and politicians," Raul Benitez, an expert in security and organized crime at the National Autonomous University of Mexico, told VICE News. "Action must be taken, but the Mexican government does not want to tackle corruption."

Money laundering in Guadalajara has crept into people's minds because of a recent wave of violence in and around the metropolitan area that has included deadly ambushes of police patrols, assassinations, and the downing of a military helicopter on May 1.

The Pearl of the West, as Guadalajara is sometimes hyperbolically known, has been flooded with dirty money since the late 1970s, when powerful drug traffickers from the state of Sinaloa moved into the city and formed the Guadalajara cartel, then Mexico's dominant criminal enterprise.

Three western states in particular are awash with drug money. Jalisco, Sinaloa, and Baja California states account for 163 of the businesses blacklisted from 2002 to 2014 by the US Treasury Department's Office of Foreign Assets Control, or OFAC, under the Foreign Narcotics Kingpin Designation Act. Guadalajara, the Jalisco state capital and an important financial hub located relatively near to the major opium and marijuana cultivating region known as the "Golden Triangle," is home to 89 of the 216 blacklisted firms, more than anywhere else in the country.

'Action must be taken, but the Mexican government does not want to tackle corruption.'

When VICE News tried to contact the blacklisted Guadalajara businesses, we discovered numerous empty offices and out-of-service phone numbers. Most employees who could be reached claimed to have no knowledge of the allegations against their bosses, while management figures were typically unavailable for comment.

Some front businesses have shut down since being identified by the US Treasury Department, but many continue to operate. Three local gas stations linked to Caro Quintero even have concessions with Mexico's state-owned oil giant Pemex that remain valid for another six to eight years.

Mexican authorities have killed or captured many of the nation's most wanted criminals since declaring war on the drug cartels in late 2006, but Benitez said there is little evidence that this strategy has seriously impacted cartel finances or broken up their extensive money laundering operations.

Today, 44 of the city's blacklisted businesses are linked to Caro Quintero, the former Guadalajara cartel boss who was jailed in 1985 for the abduction, torture, and murder of DEA agent Enrique Camarena.

Having served just 28 years of his 40-year sentence, Caro Quintero was suddenly released from prison in 2013 when a Jalisco judge overturned his conviction on a technicality. The federal government later overturned the decision but Caro Quintero had already fled. Outraged by his early release, US authorities immediately set about blacklisting dozens of businesses and individuals linked to the fugitive.

Clemente, a Guadalajara restaurant that has changed names several times, is allegedly linked to Rafael Caro Quintero's money laundering network. (Photo by Duncan Tucker)

Under the Kingpin Act, any assets belonging to designated individuals or companies in the United States are frozen, while US citizens are forbidden from doing business with them.

But Juan Manuel Gonzalez Navarro, a Mexico City-based consultant who specializes in the prevention of money laundering, told VICE News the Mexican authorities have no obligation to take legal action against businesses blacklisted by the US government.

"Mexican states have their own lists, but they're for internal use and are not made public," Gonzalez said.

He added that Mexican authorities rarely take action because of "incompetence, a lack of interest, or even because they are complicit in protecting these people or businesses."

Both Benitez and Gonzalez agreed that a new anti-money-laundering law introduced in 2013 has been ineffective.

Unraveling the labyrinth of ghost businesses and seemingly legitimate enterprises that the cartels use to clean their dirty money can be a daunting task. Many companies are seemingly shuttered within months of being blacklisted. Some simply reappear under new names.

'The owners can use a straw man to open new businesses and continue operating with impunity.'

"If a business is designated for money laundering, the owners can use a straw man to open new businesses and continue operating with impunity," Gonzalez said.

This may have been the case at Barbaresco, a popular Italian restaurant in that lies just one block away from Lucrecia in Guadalajara's upscale Providencia neighborhood.

The OFAC identified the restaurant as part of Caro Quintero's money laundering network in June 2013, but the establishment, which is also registered as Los Andariegos, recently reopened under a third name, Clemente.

The manager, Carlos Martinez, told VICE News that he was unaware of the restaurant's past and claimed that its reputation has not suffered as a result of being blacklisted.

"I've been working here for five months. I don't know what the old clientele was like, but today we have many clients who know us as Clemente and they know us for our food," he said.

A waiter who asked not to be identified confirmed that the restaurant is still run by the same owners and has simply been rebranded.

Caro Quintero's most valuable assets allegedly include Pontevedra and Zotogrande, two luxury residential complexes located in Guadalajara's exclusive Puerta de Hierro district. Zotogrande features two 12-story towers connected by a rooftop bridge, as well as dozens of houses, some valued at more than $2 million.

There was no response when VICE News called the only number listed for the two gated communities.

Two 12-story towers in Guadalajara allegedly linked to drug lord Rafael Caro Quintero. (Photo by Duncan Tucker)

Caro Quintero's Guadalajara cartel was broken up in the late 1980s, but the powerful Sinaloa Cartel that emerged in its wake continued to utilize Guadalajara as a prime money laundering location.

A number of local businesses have been linked to Sinaloa cartel kingpin Juan Jose "El Azul" Esparragoza, including a shopping mall, a residential community, and an industrial park on the southern outskirts of the city. Unconfirmed reports said that Esparragoza died at a Guadalajara hospital last summer, but the story was never corroborated by US or Mexican authorities.

In recent years the Jalisco New Generation cartel, or CJNG in Spanish, has established itself as the dominant drug trafficking organization in the Guadalajara area.

The federal government launched a major offensive against the cartel on May 1, but there has been little evidence of any effort to dismantle its financial apparatus. OFAC designated two suspected CJNG leaders in April, but it has not blacklisted a single business linked to the cartel.

Jesus Perez, an independent investigator of organized crime based in Guadalajara, told VICE News that the CJNG started out as an offshoot of the Sinaloa cartel, and likely utilizes much of the Sinaloa cartel's local money laundering infrastructure.

According to Perez, more comprehensive action in years past might have made it harder for the ascendant cartel to launder its cash today. "The Jalisco cartel's structures, networks, and personnel didn't suddenly appear out of nothing, these are people who have been around for a long time," he said.

In an interview with VICE News shortly before last Sunday's election, mayor-elect Alfaro suggested that past governments have turned a blind eye to such problems.

"I believe there are webs of corruption that explain much of what is happening in terms of security issues in the city today," he said. "We will not talk to criminals, and we do not believe in making deals with criminals."