Mayor of Mexico resort arrested for drug gang ties

Cancun mayor Gregorio Sanchez addresses the media in Cancun in this May 13, 2010 file photo.

CANCUN, Mexico (Reuters) - The mayor of the Mexican beach resort of Cancun has been arrested and charged with money laundering and drug-related crimes, making him one of the highest-ranking public officials swept up in Mexico's crackdown on narcotics traffickers.

The arrest of Mayor Gregorio Sanchez, who is running for governor of the Caribbean state of Quintana Roo for the leftist Party of the Democratic Revolution (PRD), has cast a fresh shadow over July local elections across much of Mexico amid a spate of violence and threats against candidates.

Sanchez was arrested by police late on Tuesday at Cancun's international airport after returning from Mexico City, Mexico's attorney general's office said on Wednesday. The mayor had been under investigation since January, it added.

"He was moving so much money and it just didn't match up with the amount he made as a public servant," the prosecutor's office said in a statement.

The mayor was accused of protecting drug gangs and money laundering. Sanchez has not commented on the charges.

Cancun, a city of more than half a million people, attracts millions of U.S. and European tourists annually with its white sandy Caribbean beaches, warm turquoise sea and its proximity to many of the stunning Mayan ruins on the Yucatan Peninsula.

BRIBING PUBLIC OFFICIALS

Mexico's powerful drug-smuggling cartels regularly use their deep pockets to bribe public officials and police, complicating President Felipe Calderon's army-led drug offensive launched when he took office in December 2006.

More than 23,000 people, mainly drug traffickers and police, have been killed in cartel turf wars and battles with security forces since then.

Mexico this month extradited former Quintana Roo Governor Mario Villanueva to the United States on charges of helping drug cartels shuttle hundreds of tonnes of Colombian cocaine.

Villanueva pleaded not guilty in New York on May 10 on charges of trafficking cocaine into the United States and laundering millions of dollars through Lehman Brothers bank.

Election campaigns for state governors and municipal presidents across Mexico, especially along the U.S.-Mexico border, have been shaken by violence in recent weeks.

A ruling National Action Party (PAN) candidate for mayor of a small town in the drug-plagued border state of Tamaulipas was murdered this month. Other election candidates have received death threats.

A string of mayors in Calderon's home state of Michoacan were arrested on drug trafficking charges last year, but were later freed for lack of evidence. A year earlier, two of Mexico's top anti-drug officials were arrested and accused of taking huge bribes to leak intelligence to drug smugglers.

(Additional reporting by Anahi Rama in Mexico City; Writing by Mica Rosenberg; Editing by Catherine Bremer and Will Dunham)