A Mexican national pleaded guilty to participating in a two-year, multimillion-dollar black-market peso exchange conspiracy that laundered drug trafficking proceeds through Texas to Mexico, the U.S. Justice Department said on Wednesday. 

Gabriel Arturo Castillo, of Monterrey, Mexico, pleaded guilty on Tuesday to conspiracy to commit money laundering, according to the department. Prosecutors said he took part in an international trade-based money laundering scheme designed to move proceeds from illegal drug sales in the United States to cartels in Mexico without physically transporting cash across the border. 

According to court documents cited by the Justice Department, the conspiracy collected large quantities of U.S. dollar drug proceeds in cities across the United States. The money was then either deposited into bank accounts or moved to Laredo, Texas, where it was sold to Mexican business owners who used the dollars to buy goods from U.S. stores, including perfume sellers. 

The purchased merchandise was then transported from Laredo into Mexico, while the Mexican business operators paid for the drug proceeds by transferring pesos in Mexico to drug trafficking organizations, the department said. Prosecutors said the arrangement was intended to conceal the source of the funds and allow Mexico-based traffickers to receive profits in pesos. 

“For years, Gabriel Arturo Castillo agreed to launder millions of dollars in drug proceeds through an intricate trade-based money laundering system,” Assistant Attorney General A. Tysen Duva of the Justice Department’s Criminal Division said in the announcement. 

Castillo is scheduled to be sentenced on July 7 and faces a statutory maximum sentence of 20 years in prison, although any sentence will be determined by a federal judge after considering the U.S. Sentencing Guidelines and other statutory factors, the Justice Department said. 

Read more from the Justice Department here