Utah Oil Tycoon and Family Arrested for Smuggling $300M in Crude Oil Linked to Mexican Cartels

He and his wife, Kelly Anne Jensen, were arrested at their Utah mansion on April 23 following an investigation by he US Drug Enforcement Agency, FBI, the Criminal Investigations division of the IRS and Homeland Security Investigations

A prominent Utah oil executive, his wife, and two sons have been arrested and charged in a sweeping federal case involving the smuggling of over $300 million worth of crude oil allegedly stolen by Mexican drug cartels and brought into the United States under false documentation.

James Laen Jensen, 68, and his wife Kelly Anne Jensen were apprehended on April 23 at their $9.1 million estate in Sandy, Utah. Their sons, Maxwell and Zachary Jensen, were arrested in Texas during coordinated multi-state raids led by federal authorities, including the DEA, FBI, IRS Criminal Investigations Division, and Homeland Security Investigations.

When US Marshals arrived at his 26,893 mansion in Sandy, Utah, prosecutors say the couple was unwilling to follow law enforcements' demands to come out - forcing Marshals to use a battering ram to break down the door

According to federal prosecutors, the Jensen family facilitated the smuggling of 2,881 shipments of Mexican crude oil starting in May 2022. The oil, valued at more than $300 million, was falsely declared as “waste of lube oils” and “petroleum distillates” to evade detection and violate the U.S. Tariff Act. The shipments entered the country through the family-run Arroyo Terminals facility in Texas, located near the U.S.–Mexico border.

Investigators allege that the crude oil was originally stolen from PEMEX, Mexico's national oil company, and trafficked by cartel-linked organizations. Payments for the oil were funneled to shell companies in Mexico operating with cartel authorization. Prosecutors claim that James Jensen knowingly paid over $47 million to these criminal entities.

James Laen Jensen, 68, an American oil magnate, has been accused of working with Mexican cartels to smuggle over $300 million worth of crude oil into the United States

When U.S. Marshals arrived to arrest the couple in Utah, they were met with resistance. Marshals were forced to use a battering ram to breach the door of the nearly 27,000-square-foot residence. Simultaneously, agents raided the Arroyo Terminal in Texas, placing employees in handcuffs, confiscating documents, and demanding computer passwords.

One employee recounted that agents asked whether they knew the oil was stolen. “We don’t know anything about that,” the worker said. “We’re just in charge of unloading the trucks and loading the barges.” Another added, “When it comes to the aspect of knowing where the oil’s coming from or what company or what part of Mexico or anything like that, we were always out of the loop.”

Meanwhile, agents also descended on his business, Arroyo Terminals, in Texas

James Jensen now faces multiple felony charges including conspiracy to commit money laundering, aiding and abetting smuggling of goods, entry of goods by means of false statements, and money laundering spending conspiracy. His family members face one to three of the same charges each.

All four have pleaded not guilty.

Maxwell - who co-owns Arroyo Terminals with his father - was accused of working closely with 'cartel-affiliated businesses'

Federal prosecutors sought to detain Maxwell Jensen without bond, citing his co-ownership of the terminal, frequent travel to the Bahamas, and connections with cartel-affiliated businesses. The judge agreed, ordering him held without bond. His brother Zachary, who managed marketing and business development for the company, was released on a $100,000 bond with a $10,000 cash deposit, and will be subject to GPS monitoring and house arrest.

In Utah, James and Kelly Jensen were released without bond after their attorneys argued they were upstanding citizens with deep community ties. The judge warned them to comply with all pretrial conditions, including surrendering passports and regular check-ins. Kelly’s parents, Gordon and Carlene Walker, are both former public officials—her father served in the Department of Housing and Urban Development under President Ronald Reagan, and her mother served in the Utah State Senate.

The family was forced to forfeit any money gained from the smuggled oil - including their company, an additional home listed for the family in Draper, Utah as well as bank accounts and new cars totaling $300 million

The court also ordered the forfeiture of the family’s illegally obtained assets, including their company, luxury vehicles, a second home in Draper, Utah, and multiple bank accounts—totaling $300 million in value.

This is not the first time James Jensen has faced allegations related to illicit petroleum transactions. In 2011, PEMEX Exploration and Production sued him and two of his companies—Big Star Gathering and St. James Oil—for allegedly purchasing stolen natural gas condensate from Mexican cartels. That case was dropped in 2013 after extended litigation.

If convicted on the current charges, members of the Jensen family could face up to 20 years in federal prison and fines reaching $500,000.