IMG Academy, a Florida boarding school known for its elite academic and athletic programs, has reached a $1.72 million settlement with the U.S. Treasury Department over alleged violations of sanctions related to drug trafficking, according to a statement released by the Office of Foreign Assets Control (OFAC) on February 12, 2026.
The settlement stems from transactions conducted between 2018 and 2022 with two individuals designated under the Kingpin Act for providing financial support to a Mexican drug cartel. These individuals, referred to as SDN 1 and SDN 2 by the Treasury Department, used IMG Academy to enroll their children as student-athletes, paying tuition ranging from $47,026 per semester to $102,235 annually, inclusive of tuition, room, and board.
According to the OFAC report, IMG Academy signed annual enrollment agreements with both sanctioned individuals. Payments were primarily made through third-party bank transfers and credit card charges originating in Mexico. Any credit balances remaining at the end of a school year were routinely applied to the following year’s tuition, effectively continuing the financial relationship.
The Treasury Department detailed that IMG Academy committed 89 apparent violations between 2019 and 2025 by maintaining contracts and processing payments from the sanctioned individuals. The OFAC assessment determined the violations to be “non-egregious,” but noted that IMG Academy did not voluntarily disclose the infractions, as the investigation was already underway when the school came forward.
The school’s cooperation with the investigation, including providing timely and substantial responses to information requests, and its agreement to suspend the statute of limitations during the inquiry were factors considered in the settlement amount. Following a change in ownership in June 2023, IMG Academy has reportedly implemented a risk-based sanctions compliance program and hired a new Chief Legal Officer to conduct a retrospective review.
The OFAC report as well criticized IMG Academy for failing to conduct adequate due diligence during the application, enrollment, and contract signing processes. The report stated that a basic background check would have revealed the sanctioned status of the individuals, as their names matched entries on the Specially Designated Nationals (SDN) List.
