Mexico's March 2026 AML Reform: What New LFPIORPI Rules Mean for Your Cabo Closing

Mexico AML reform 2026 real estate rules changed on March 27 when a decree hit the Diario Oficial de la Federación. If you are buying property in Los Cabos, several of those changes land directly on your closing.

What Actually Changed on March 27, 2026

The decree, published in the DOF, amends, adds, and repeals provisions in the regulations under Mexico's Federal Anti-Money Laundering Law, known as the LFPIORPI (Ley Federal para la Prevención e Identificación de Operaciones con Recursos de Procedencia Ilícita). This is the same law I covered in my earlier guide to Mexico's anti-money laundering rules for cash buyers, but the March reform adds teeth in several areas that directly touch real estate closings.

The law firm Garrigues, which has offices in Mexico City, published a detailed analysis confirming the changes. Let me walk through the ones that matter if you are buying a condo in Diamante or a villa in Pedregal.

Beneficial Ownership: The Threshold Drops to 25%

Before this reform, Mexico required disclosure of beneficial owners holding more than 50% of a legal entity involved in a real estate transaction. The March 2026 decree cuts that threshold to 25%.

In practical terms, this means more people get identified. If you are buying through an LLC, a trust, or any entity where three or four partners each hold a quarter, every one of them now needs to be disclosed. Previously, only a majority holder would have triggered the requirement.

This aligns Mexico more closely with international standards from the Financial Action Task Force (FATF), which has recommended a 25% threshold for years. The United States moved to a similar standard under the Corporate Transparency Act. Mexico is catching up.

What You Need to Do

If you are buying as an individual through a fideicomiso bank trust, this change has minimal direct impact on you. You are already identified as the beneficiary of the trust.

If you are buying through a US LLC, a Mexican SA de CV, or any multi-member entity, have your ownership percentages ready. Your notario will need to document every person holding 25% or more. Bring copies of your operating agreement or corporate charter showing the ownership breakdown.

• Individual buyers through a fideicomiso: minimal new paperwork
• LLC or corporate buyers: prepare ownership documentation for all members at 25%+
• Multi-entity structures: each layer of ownership may need to be traced to the 25% threshold
• Trusts with multiple beneficiaries: each beneficiary at 25%+ must be disclosed

Fideicomisos Must Now Register With the RFC

This one caught a lot of people off guard. The reform requires fideicomisos and other legal vehicles that carry out vulnerable activities to register with Mexico's Federal Taxpayers Registry (the RFC) and obtain an electronic signature called an e.firma.

Previously, the bank holding your fideicomiso was the obligated entity. The trust itself did not need its own RFC registration in most cases. Now it does, if it is involved in activities the law classifies as vulnerable, and real estate transactions are on that list.

For a foreign buyer, this means your bank trust may now carry additional administrative obligations. Your fideicomiso bank, whether it is BBVA, Scotiabank, Banorte, or Monex, should be handling this registration as part of trust administration. But you should confirm that they have done it or are in the process.

Questions to Ask Your Fideicomiso Bank

• Has my fideicomiso been registered with the RFC under the new rules?
• Does my trust have an active e.firma?
• Will there be any additional annual fees for maintaining this compliance?
• What documentation do you need from me as the beneficiary?

If you are in the process of setting up a new fideicomiso as part of a purchase, ask your notario about the timeline. RFC registration and e.firma issuance add steps. Whether that adds days or weeks depends on the bank, but factor it into your closing timeline.

Developers Are Now Explicitly Obligated Entities

Before the March 2026 reform, real estate brokers and notarios were clearly listed as obligated entities under the LFPIORPI. Developers occupied a grayer area. The reform removes that ambiguity: developers are now explicitly named.

What does this mean for you as a buyer? Developers must now conduct their own due diligence on buyers, maintain records, and report suspicious transactions. If you are buying a pre-construction unit directly from a developer in Los Cabos, expect more paperwork at the front end of the process.

This is actually a positive development for buyers. More oversight on the developer side means the transactions flowing through a development are cleaner. It raises the bar for everyone, and that makes the market more transparent.

Impact on Pre-Construction Purchases

Pre-construction buyers often make payments directly to the developer over months or years. Under the new rules, each payment above the threshold triggers reporting obligations. Developers must verify the source of funds and maintain documentation throughout the payment schedule.

If you are buying pre-construction at a place like Oleada, Soho House Cabo del Sol, or any of the new developments on the Pacific side, expect your developer to ask for:

• Proof of funds documentation at the time of reservation
• Source of funds declarations for each payment above the threshold
• Updated identification if the payment schedule spans more than 12 months
• Beneficial ownership information if purchasing through an entity

Cash Transaction Thresholds: The Numbers

The LFPIORPI has long restricted cash transactions in real estate. The March 2026 reform clarifies and reinforces the thresholds:

• Real estate sales and brokerage: transactions at or above 8,025 times the daily UMA are classified as vulnerable activities. At the 2026 daily UMA value, that works out to roughly $47,000 to $50,000 USD.
• Fideicomiso creation or modification: the threshold is 4,000 times the daily UMA, or roughly $23,000 to $25,000 USD.
• Cash prohibition: transactions above these thresholds cannot be settled in cash. Payment must be by bank transfer, cashier's check (cheque de caja), or other traceable instrument.

For most foreign buyers purchasing property in Los Cabos, this is not a practical change. You were already wiring funds internationally. But if you were planning to bring cash for any portion of the transaction, that door is effectively closed at these levels. The SAT (Mexico's tax authority) and the UIF (Financial Intelligence Unit) are the enforcement bodies.

What This Means at the Notario's Desk

Here is the practical impact when you sit down to close on a property in Los Cabos under the new rules:

1. More identity documentation. Your notario will collect more detailed identification from all parties, including beneficial owners at 25%+.
2. Fideicomiso paperwork. If your trust has not been RFC-registered, that step needs to happen before or at closing. Ask early.
3. Source of funds. Be ready to document where your purchase money came from. Bank statements, wire transfer confirmations, and proof of sale of other assets are standard.
4. Developer compliance. If you are buying from a developer, they will have their own compliance checklist. This may add a meeting or a round of document exchange to the process.
5. Wire-only settlement. Cash for any portion above the threshold is out. Plan your wire transfers with your US or Canadian bank well in advance.

None of this should scare you. Mexico is moving toward greater transparency in real estate transactions, and that protects buyers. The extra paperwork takes a few hours, not a few weeks. The key is knowing about it in advance so your attorney and notario can prepare.

Context: The July 2025 Reform

The March 2026 changes build on an earlier reform from July 2025 that tightened ultimate beneficial owner (UBO) disclosure rules and raised fine ranges under Article 17 of the LFPIORPI. That reform was the first signal that Mexico was moving toward stricter enforcement in real estate.

Together, the two reforms represent a significant shift. Mexico has historically been perceived as having lighter AML enforcement in real estate compared to the US or EU. That gap is closing. If you have been watching the FATF mutual evaluations of Mexico, the direction has been clear for several years.

How to Prepare for Your Cabo Purchase

If you are actively looking at property in Los Cabos, here is your checklist under the new rules:

• Get your documents in order early. Passport, proof of address, source of funds documentation, and entity ownership records if applicable.
• Ask your fideicomiso bank about RFC status. If you already own property through a trust, confirm it is registered. If you are setting up a new one, build in extra time.
• Work with a Mexican real estate attorney. Not just a notario. An attorney who understands the LFPIORPI changes can review your transaction structure and flag issues before they become delays.
• Plan your wire transfers. Talk to your US or Canadian bank about international wire capabilities and fees. Some banks have daily limits that require advance notice for large transfers.
• Expect more questions from the developer. If you are buying direct, the developer's compliance team will be more involved than in past transactions.

For more on the overall closing process, see my detailed guide to Mexico real estate closing costs.