By Mary Jordan
Washington Post Foreign Service

MEXICO CITY, April 23 -- The U.S. Treasury Department has temporarily stopped sharing information on financial crimes with Mexico after confidential information it provided authorities here was displayed in public by a government official, Mexican officials announced Friday.

The U.S. move, which could hamper investigations of cross-border drug trafficking and money laundering, represents an unusual rift between the Bush administration and the government of President Vicente Fox on law enforcement matters.

Mexico City Mayor Andres Manuel Lopez Obrador recently displayed a confidential U.S. Treasury Department document at a news conference about a scandal involving his former finance minister, Gustavo Ponce. Ponce has not been seen publicly since videos were broadcast on television showing him gambling in Las Vegas and Mexican newspapers published receipts of his lavish bills at the city's Belaggio Hotel. Police are seeking him for questioning.

The scandal has decreased the popularity of Lopez Obrador, the leading candidate for the presidency in 2006 elections. Lopez Obrador has charged that the U.S. government turned over damaging information about Ponce to Mexican federal officials, who then sat on it until it could inflict maximum political damage to the mayor. Mexican federal officials have denied any improper actions in the case.

William Fox, director of the Treasury's Financial Crimes Enforcement Network, said in an April 21 letter to Mexican authorities that the department's investigators would not turn over any more information until Treasury "receives the appropriate assurances that all such sensitive information will be protected from unauthorized disclosure," according to a copy of the letter.

The Financial Crimes Enforcement Network is an office within Treasury that investigates the financing of terrorist groups, money laundering and other financial crimes.

U.S. Treasury spokeswoman Jane Fisher said the "breach of confidential information" in the Ponce case was "serious, and we're not taking it lightly." She added that Treasury officials hoped the matter would be resolved soon.

Mexico's attorney general, Rafael Macedo de la Concha, said at a news conference Friday that U.S. cooperation was key in monitoring a large number of financial transactions as the two countries pursued money laundering and other financial crimes. "We have worked with a lot of trust with the U.S. government, and I think we can convince them this case was an exception," he said.

Lopez Obrador reiterated at a news conference on Friday his claims that the Mexican federal government had asked U.S. authorities for help in the Ponce case, "not to fight corruption, not to punish those responsible. But rather to harm us." The mayor said Mexican federal authorities were to blame for the suspension of U.S. cooperation: "They acted very irresponsibly and now these are the consequences."

Lopez Obrador is a member of the opposition Democratic Revolutionary Party, and Fox is from the National Action Party. Fox is limited by law to one six-year term, and Lopez Obrador is a rising star on the national political scene. On Friday, he answered a subpoena and appeared for questioning by federal investigators in the corruption case involving Ponce.

Political analyst Carlos Heredia, a former aide to Lopez Obrador, said many Mexicans believed that there was some truth in both sides of the political spat between Lopez Obrador and the Fox administration and that it involved both "corruption as well as the procrastination of the federal government in going after Ponce."

Staff writer Jonathan Weisman in Washington contributed to this report.

© 2004