Anatomy of a Drug Cartel

The trial of Juan García Abrego showed how Mexican kingpins smuggle Colombian cocaine to American cities—and how Texas banks wind up with some of the profits.

January 1998By Comments

You won’t find drug trafficker Juan Garcia Abrego at the Piedras Negras Restaurant in Matamoros anymore, but he used to hang around there all the time. These days you will find only his uncle Juan N. Guerra, who holds court in the back of the restaurant most mornings, beginning around ten. When I went there last June, the old man had not yet arrived, but people were already waiting to ask favors of him, as they have done for years. They looked like honest men, farmers with dirt under their fingernails, and they sat in respectful silence at the blue leather booths. They looked humble too, but in this place they were cloaked in an air of bloody machismo, thanks to the paintings of racehorses and cockfights that hung on the walls. Norteño music drifted through the room, periodically interrupted by crashes from the kitchen and the warbles of small green birds in a wire cage.

By ten-thirty the restaurant was nearly full. Guerra uses a wheelchair to get around, and when he finally arrived, he was pushed into the restaurant by his driver. As he motioned hello to the faces he knew, he looked harmless and feeble, just another old man with age spots and thinning white hair. Yet for years Guerra has constituted the unofficial government of Matamoros, Mexico, where corruption spills out over the streets like bougainvillea and hibiscus. He has never run for public office, but he wields more power than most who have. Exactly how he acquired this stature is unclear. There are old stories of murders he has been accused of committing, and these tales, apocryphal or not, do much to bolster his image as a strongman. Even more important than any long-ago bloodshed, however, is the respect that Guerra commands because he is wealthy. His business enterprises include an international trucking company, and he has always been rumored to be involved in smuggling. Among the contraband members of his family have peddled are auto parts and household appliances, and probably liquor.

In all likelihood, it was in this very room that Juan García Abrego learned many of the lessons that helped him establish one of Mexico’s largest drug cartels. Years ago García Abrego adopted his successful uncle as a surrogate father. His parents were lowly tenant farmers, but growing up along the banks of the Rio Grande, his overweening ambition fed by the border’s hypermaterialistic culture, García Abrego aspired to greater things. After apprenticing himself to his uncle, García Abrego cast off his lot as a factory worker at a Nabisco plant and amassed a fortune, ostensibly through legitimate trucking enterprises. But his fortune was not legitimate, and his trucks did not haul just ordinary goods. Until he was sentenced to life imprisonment in a Houston courtroom last January, García Abrego, age 53, ran the Gulf cartel, an organization that still controls practically all of the narcotics that pass into the United States through Matamoros. Along with similar organizations formed elsewhere on the border, the Gulf cartel has sent billions of dollars of cocaine into the U.S., sowed unprecedented corruption of Mexican politicians, and flooded Texas banks with drug money. Attorney General Dan Morales estimates that $30 billion a year in drug money is laundered through Texas banks—fully 20 percent of the estimated $150 billion a year in drug money laundered worldwide. Juan García Abrego learned his uncle’s lessons well.

Now a series of cases prosecuted in Houston offers a rare look inside García Abrego’s operation. The cases map out exactly how a drug cartel works, as well as how tainted money subsequently makes its way into Texas banks. In a nutshell, the drugs go north and the money comes south. Cocaine from Colombia moves through Mexico, across the border into Texas, and from there to various cities in the U.S. After the cocaine is sold, the cartel hauls the proceeds south again in eighteen-wheeler trucks, moving vans, and tractor trailers. The cartel smuggles the cash into Mexico and finally sneaks it into the U.S. banking system. Over the past decade tens and perhaps hundreds of millions of dollars of the Gulf cartel’s money has moved through Texas banks.

In other words, the same wrinkled $5 bill used to buy crack on the streets of New York eventually makes its way into the hands of a Texas banker in a pin-striped suit. Most of the bankers who handle the dirty money do so with ignorance, and they commit no crime. But these staggering sums raise a question: Are some of the bankers willfully blind to their roles in the creation of the trading empires of men like Juan García Abrego?

Soto la Marina

The story of the gulf cartel’S far-flung operations begins in an unlikely place. Soto la Marina is a 250-year-old village thirty miles from the Gulf of Mexico, about 125 miles south of Brownsville. Starting in the mid-eighties, however, it entered the modern world of international commerce, when García Abrego bought half a dozen large cattle ranches in the area. Soon the sounds of airplanes were disrupting the isolation, as Turbo Commanders appeared in the sky, circled a few times, and bumped along dirt landing strips. After the planes lurched to a halt, ranch hands were waiting, ready to unload the large green duffel bags. Padlocks concealed the contents from thieves or spies, and perhaps the men of Soto la Marina never knew what they were unloading. If the veil was ever pulled aside, if someone whispered that the duffel bags were full of bricks of cocaine, they were smart enough to go about their business as if they had never heard.

The one-kilogram bricks were bundled in burlap sacks or wrapped in brown bags, and they often bore the label “Gordos,” Spanish for “heavy” or “fat.” This was one of several labels used by the Cali cartel of Colombia—a group renowned for its high-quality merchandise, which is more than 80 percent pure. The presence of Colombian cocaine in Soto la Marina indicated  a recent change in the world’s drug-trafficking patterns. Colombian cocaine used to enter the U.S. through Florida, but fifteen or so years ago a crackdown by U.S. drug authorities along the Florida coastline caused Colombian traffickers to abandon their old shipping routes. Americans consume about $49 billion worth of illegal drugs every year, and most of it now passes through Mexico before being distributed. About 330 tons of cocaine are estimated to move through that country every year. This commerce has led to the rise of about twenty Mexican drug-trafficking organizations. Most of the drugs are moved by the three largest groups: the Baja cartel, based in Tijuana; the Juárez cartel, based in Ciudad Juárez; and García Abrego’s Gulf cartel in Matamoros. At first the Mexican traffickers were no more than intermediaries, but their power grew as the Colombian cartels became more dependent on the Mexican distribution networks. Eventually many of the middlemen grew into full-blown traffickers themselves. After the leaders of these organizations realized that it was more profitable to respect one another’s turf, they joined forces and became known collectively as the Mexican Federation.

Schooled in the art of spiriting goods across the border, García Abrego was ready when the Colombians arrived. He had built his empire in the traditional fashion: He forced early rivals to cut him in on their business or else he eliminated them. His rise to power included some legendary scenes, such as the time when gunmen working for him invaded a medical clinic in Matamoros and mowed down Casimiro Espinoza, or Cacho, a rival drug dealer working in the same territory. Once García Abrego assumed authority over the narcotics moving through Matamoros, he worked out a deal with his Colombian friends: He would deliver half of every shipment to representatives of the Cali cartel within the United States, and he would keep the other half as payment for getting the drugs across the border. “It was a partnership,” testified Tony Ortiz, one of García Abrego’s primary U.S. distributors, at García Abrego’s trial. “[T]he Colombians would deliver four thousand kilos into Mexico. We split: two thousand kilos for them, two thousand kilos for us.”

Eventually García Abrego’s operation grew to the point where it was pulling in $2 billion a year, according to U.S. prosecutors. He collected ranches all over the states of Tamaulipas and Nuevo León and displayed his wealth by taking private planes to horse races in the south of Mexico. One of his nicknames was la Muneca, or the Doll, because he was such a sharp dresser. He was often found with friends at the Drive Inn in downtown Matamoros, drinking Chivas Regal in the restaurant’s gold-wallpapered, casinolike atmosphere, wearing an aristocrat’s white linen jacket.

North to the Rio Grande

To avoid complications, Garcia Abrego was rarely found in the same place as his cocaine shipments. Among the small group he trusted to oversee the handling of the merchandise in Soto la Marina was Carlos Reséndez, a former comandante in the state police force of Tamaulipas. “I helped to unload several planes loaded with cocaine,” Reséndez said when he took the witness stand at García Abrego’s trial. “We unloaded the cocaine, we lowered the cans . . . where they carried their spare gasoline. We filled them back [up], and we refueled the plane with gasoline so they could get back.”

Workers then loaded the duffel bags into Cessna 206’s. From Soto la Marina, pilots flew the cocaine north, to other ranches that García Abrego owned along the Rio Grande around Matamoros. There García Abrego relied on two notorious henchmen to get the cocaine into the United States. One of them, Luis Medrano, got his start in the drug trade working for one of García Abrego’s former competitors in Matamoros. The other was Oscar Malherbe. His nickname is el Compadre, and street talk suggests that he started out as a hit man.

Medrano and Malherbe were always found together, and they oversaw activities in Matamoros from a walled compound patrolled by six to eight armed men. Mexican law enforcement agents gave the gang plenty of leeway, for reasons that became clear at García Abrego’s trial. “We pay off the government officials, the agents in charge of that region or that area,” explained Ortiz. “Narcotics agents, federal agents that worked with the Justice Department in Mexico.” Among the high-ranking officials identified as taking bribes from García Abrego were Emilio López-Parra, a comandante with the Federal Judicial Police in Matamoros; Luis Esteban García Villalón, an agent with the Federal Ministry; and Javier Coello Trejo, a deputy attorney general in the Mexican attorney general’s office. Recalling a conversation he had with García Abrego, Reséndez explained, “He told me they had to receive a monthly installment—that Javier Coello Trejo, Luis Esteban García Villalón, and Emilio López-Parra had fixed a quota of a million and a half dollars every month.”

When asked more specifically what the public officials were being paid for, Reséndez said, “So they could turn the other way.” If García Abrego’s men wanted to move a major shipment of drugs into the United States, they waited until all the agents in the field received a prearranged call on their radios ordering them to return to headquarters for a meeting. After the area was cleared of law enforcement, workers drove the cocaine down to the Rio Grande in pickup trucks. They often floated the drugs across the river on rafts. Once on the other side, the cocaine was stored in safe houses the cartel had set up throughout the Rio Grande Valley, such as a modest white bungalow in Harlingen, where Department of Public Safety officers once found nine tons of cocaine packed in cardboard boxes, flour sacks, and duffle bags.

The Promised Land

To a degree, the corruption that the Gulf cartel and its sister organizations spread throughout Mexican society crossed over into the United States, where low-ranking government employees have been found on the cartels’ payrolls. Growing reports of vice along the border have led elected officials to call for congressional hearings and law enforcement agents to form a border-corruption task force. But north of the Rio Grande the Gulf cartel operates primarily by stealth.

Within the United States the organization established small groups of people, or “transportation” cells, in Houston, Dallas, and other Texas cities, who knew and trusted one another. For the most part, the cells operated independently of one another, and the beauty of the system was that the members of one cell couldn’t implicate anybody outside their own group. Ground-level employees—the ones who actually handled the drugs, and therefore the people who stood the greatest chance of getting arrested—knew just the first name or the nickname of the man they worked for, and nothing more. Only the cells’ leaders would be in contact with anyone in Matamoros. By these methods the senior players in the Gulf cartel eluded U.S. law enforcement for more than ten years.

One of the longest-lived transportation cells in Texas was run by Tony Ortiz, also known as el Pescado, because he once owned a fish market in Houston. Ortiz was smart and careful, and it was many years before he found himself inside prison. He met his subordinates at hotels like the La Quinta on the Southwest Freeway, never at his home. He didn’t have a telephone and nothing was in his name. “We put a couple of pagers under ‘Mohammed,’” he remembered during García Abrego’s trial. “Weird names. They didn’t belong to anybody.” Above all, Ortiz never touched the cocaine himself. “It is too much of a risk. When I can pay somebody else, why take a chance?”

Ortiz started out transporting marijuana in 1976. At first he worked for himself, but after he met Luis Medrano in the early eighties, he began distributing pot for him too. When Medrano started working for the Gulf cartel, Ortiz agreed to transport cocaine for the organization from the Rio Grande Valley up to Houston. He sent his first four shipments of cocaine to Houston on United States Immigration and Naturalization Service (INS) buses. Employees of the INS regularly drove illegal immigrants apprehended in the Valley north to Houston airports to be deported, and Ortiz recruited a former INS officer named Joe Polanco, who had friends at the agency, to stash drugs on the buses as well. Unlike civilian vehicles, the INS buses never had a problem getting past the federal patrols manning the Sarita checkpoint on U.S. 77. “They just wave it on,” Ortiz recalled.

Joe Polanco was caught in 1990 when FBI agents stumbled onto him in Houston, staying in an apartment that belonged to Ortiz. Polanco was subsequently convicted of drug trafficking. Ortiz evaded arrest for a while by moving to San Antonio and dropping out of sight, and he stopped using INS buses to move cocaine. From then on he relied entirely on commercial freight companies. Ortiz, who had run his own business, knew he could mix narcotics with the lawful commerce flowing along the nation’s highways. He also knew it was hard for the police to distinguish between legitimate and illegitimate merchandise if both were packaged and handled the same way.

Through intermediaries—his name was never on a lease, never on a shipping receipt—Ortiz established a series of front businesses. One was a company called A-OK Transmissions in Harlingen. The company, which had little to do with transmissions, operated out of a tan metal warehouse that functioned just like the distribution hub of an ordinary business: The workers packed the individual bricks of cocaine, still bearing the “Gordos” label, into large metal containers, which were welded shut or padlocked and then encased in wooden crates. Finally, the crates were loaded onto small panel trucks and driven over to a shipping business. Ortiz used companies like Southwestern Motor Transport and Central Freight to get the drugs to Houston and Yellow Freight to distribute the drugs  around the nation (neither the companies nor the drivers knew about their illicit cargo). Transmissions weren’t the only cover Ortiz used; often he packed cocaine in freezers (useful in masking the cargo’s scent), disguising it as frozen food. Another masquerade was a business called J and T Plumbing and Fixtures. “That was a front business,” Ortiz testified. “Very front. They didn’t know anything about plumbing.”

New York, New York

Some of the cocaine Artiz delivered to Houston was sold to dealers there, but most of it was ultimately destined for Chicago, New Jersey, and New York City. In New York, the Gulf cartel’s largest market, the drug was worth four times what it was in Mexico. The Gulf cartel employed numerous people to deliver cocaine there, and many of them contacted the same person once they arrived: the notorious Tomás Sanchez González, better known as Gringo. Gringo began working for the cartel as a flunky, helping to load and unload drugs from vehicles in Houston. He worked his way up, overseeing the cartel’s sales of cocaine in New York to local dealers. Gringo ran the cartel’s operations there for several years, until he angered the group’s top leadership by assuming too much independence. Among Gringo’s crimes was siphoning off $8 million of the organization’s profits and attempting to go into business on his own, only to lose the cocaine he had bought with the cartel’s money in a bust. Eventually he was assassinated, apparently on the orders of Luis Medrano.

The full story of Gringo’s career vanished with his death, but he oversaw an operation that raked in tens of millions of dollars a week. On January 4, 1989, police detectives raided a Gulf cartel warehouse on Fifty-seventh Place in Queens. Inside they found a 24-foot-long moving van bearing a cache of weapons and two dozen U-Haul boxes full of U.S. currency. The boxes were labeled “Gogrin,” which the detectives concluded was code for “Gringo,” and they contained $18.3 million. The truck bore the logo of a business called Zoom Furniture; although Zoom was a legitimate business, its trucks were used by the cartel to transport drug money back to Houston.

During their surveillance of the cartel in the New York City area, detectives discovered a set of cryptic financial records in a home in a respectable Long Island neighborhood. A typical entry read: “Salio, 12/10/88: $5,395,000.” Another: “Salio, 12/12/88: $2,152,000.” Every couple of days, in other words, several million dollars was salio, or sent, first to Houston and from there to Matamoros. For anyone who had ever wondered what caused the drug trade to so completely infect the streets of large American cities, here was the answer: money, literally tons of it. In an era of instant electronic wire transfers, the Gulf cartel was clumsily, mechanically hauling back revenues any Fortune 500 company would appreciate. Tony Ortiz recalled once helping unload a tractor-trailer in Houston carrying $24 million. When asked to estimate how much money he had personally sent to Matamoros for the cartel, Ortiz replied: “Man, I don’t have the slightest ideas. . . . Millions. Millions of dollars.”

South to the Rio Grande

For a would-be aristocrat like GarcÍa Abrego, lugging around boxes of dollar bills was clumsy, not to mention indiscreet. To spend the cash with propriety, he had to get it into a bank. American banks are more secure than Mexican financial institutions, but the problem was how to get an American bank to accept his cash—how to disguise the fact that the money came from a drug-trafficking empire. Taking the money straight to an American institution was too risky, because all cash transactions of more than $10,000 are reported to the federal government. So García Abrego orchestrated a convoluted ballet designed to obscure the origins of his wealth. First he smuggled his profits to Mexico, where financial transactions are not as carefully scrutinized, then he tried to make it appear as though the cash had been earned legitimately, and finally he sent much of the money back into the U.S.

The eighteen-wheelers full of cash made it to Texas easily enough, but smuggling the boxes of bills across the border was tricky. It is illegal to transport more than $10,000 in cash out of the U.S. without declaring the action to U.S. Customs, something García Abrego wanted to avoid. His most reliable stratagem involved paying Mexican Customs agents to drive the cash over the border for him. On April 11, 1990, two such agents, Juan Miguel Lizardi García and Alberto Laurent Ayola, were caught red-handed trying to cross the Gateway International Bridge from Brownsville to Matamoros in a dark blue Jeep Cherokee Wagoneer. U.S. Customs agents found $2.4 million in cardboard boxes under a vinyl sheet in the back of the Jeep.

But most of García Abrego’s couriers were not caught, and over the years they managed to smuggle enormous sums into Mexico. Once the money was there, García Abrego had different means of sneaking it into the banking system. Apparently one method (Mexican authorities are still investigating the allegations) was to deposit the cash into corporate accounts held by two businesses that he controlled, TREFIMEX and CAIMSA. TREFIMEX was a transportation business ostensibly owned by García Abrego’s son, Juan José García González, though García Abrego himself secretly ran the company’s operations. CAIMSA manufactured industrial machinery parts, and among its directors was Rubén García Robles, a cousin of García Abrego’s. García Abrego also laundered drug profits by using the dirty money to buy the dozens of ranches and houses that he owned.

Banking on Texas

Garcia Abrego had another method of laundering cash, which U.S. investigators finally succeeded in unraveling after years of painstaking legwork. In this scheme García Abrego used casas de cambios, or money-changing operations, to get money into Texas banks. Money exchange houses offered a cunning shield for the cartel, because they too dealt in cash of small denominations. Once the drug money was mixed in, there was no sure way to tell it apart from clean currency, except to watch for suspicious activity, such as a flurry of subsequent bank transfers. To serve as his main front man, García Abrego enlisted Ricardo Aguirre, the former manager of a PEMEX gas station in Matamoros, who was known by the nickname Kenny Rogers. “He was always wearing cowboy outfits,” testified Francisco Segura, one of the cartel’s employees. Aguirre was part-owner of Casa de Cambio Colón in Monterrey, and he also worked with Casa de Cambio Nuevo León. Beginning in 1989, several employees of the cambios started crossing the U.S. border in cars and private planes. Although they brought with them large amounts of U.S. currency, they acted as if the cash were legitimate—they followed all the required regulations, filling out forms stating how much money they were importing. On June 21, for example, a courier arrived with $3,720,000, according to Customs documents. On June 22 one flew in with $1,700,000.

Often the couriers deposited the money into accounts belonging to the casas de cambios at First City Bank in McAllen. So far, only the size and the frequency of the deposits looked peculiar—but then the money started to move around in odd ways. From First City, Aguirre wired millions to Banker’s Trust in New York, where a banker named Antonio Giraldi was working. In an elaborate shell game, Giraldi then moved the money into several Swiss bank accounts. One was opened in the name of a holding company called White Horse Investments and another in the name of Stallion Investments. (Later, detectives would remember García Abrego’s interest in horse racing.) Both companies were incorporated in the Cayman Islands.

Eventually detectives discovered that the legal owners of Stallion were Aguirre and two of his relatives. They were even more interested to learn that the owners of White Horse were Aguirre, a relative, and a woman named María del Carmen Olivella—García Abrego’s wife. After Giraldi went to work for American Express Bank International in 1990, the money followed him there, into an account he opened for a company called Green Mountain Holdings. Over time the total amount of money that made its way from First City Bank in McAllen through the maze of transfers and into the Green Mountain account was $25,026,764.76—a small fraction of the billions that the Gulf cartel earned but all that prosecutors were able to track down. Although that sum officially belonged to Aguirre and his relatives, the jury found that it really belonged to García Abrego. “In this situation, the true owner didn’t want his name on anything, and his name was not in fact on anything,” testified Vincent Iglio, a money-laundering expert who works for U.S. Customs. “They were sheltered. What I call a veil of secrecy was created by these offshore accounts so that, in this particular case, for individuals like myself, it was almost impossible to determine who the true owner was.”

Besides First City Bank in McAllen, at least two other Texas banks have accepted money that once passed through the Gulf cartel financial empire. Couriers for Mario Ruiz Massieu, a former deputy attorney general of Mexico, used to arrive at Texas Commerce Bank in Houston with suitcases full of cash in small denominations. Eventually Massieu collected $9 million in his account, attracting the attention of law enforcement. Last April a federal judge in Houston ruled that the money in Texas Commerce constituted the proceeds of a drug conspiracy stretching into the upper echelons of the Mexican government, involving several drug traffickers, including García Abrego. Additional sums wound up in the International Bank of Commerce in Laredo and the Harlingen National Bank, in accounts controlled by Luis Esteban García Villalón, an agent with the Federal Ministry, who was also in cahoots with García Abrego.

The Streets of Brownsville

Last summer i was driving up and down elizabeth street, the backbone of Brownsville, looking for Mercantile Bank, the oldest financial institution in town. As I scoured the street, I realized that it was full of banks. Practically every other building housed one. The same is true in towns all along the border, where banks are drawn to the profits they can make from sitting next to Mexico, a country with a weak currency and an unstable banking system. Sixty percent of the money deposited into Mercantile Bank, for example, comes from Mexican nationals. I wanted to know how much of the money flowing into border banks was coming from the drug trade, but I wasn’t getting any clear answers.

In recent years Jim Scott, the president of Mercantile Bank, has become a spokes-man for integrity in the Valley’s banking community. In an interview, Scott argued that bankers do a good job of policing money, although he acknowledged they face a staggering problem. “The first premise is, Know who you’re doing business with,” said Scott. “We have a lot of clients in Mexico, and we’ve been doing business with the majority of those individuals for fifteen, twenty, twenty-five years. We know them well. We know their families.” And the second premise is, Scrutinize everybody, whether you know them or not. Banks remain responsible for reporting all cash transactions of more than $10,000, and recent changes in the law now also require them to report any suspicious activity—although what constitutes suspicious activity is left up to the bank to determine. Mercantile now pays three full-time employees to do nothing but look for fishy transactions, sometimes using sophisticated computer software.

For the most part, law enforcement agents also defend the integrity of bankers, and there has been little evidence of cooperation between bankers and drug dealers. Even though First City Bank in McAllen served as one of the points of entry for García Abrego’s drug money into the U.S. financial system, nobody who worked there was charged with wrongdoing. Nobody who worked at Texas Commerce, where Massieu stashed his payola, was charged with any crime either. So far, Giraldi and an assistant of his are the only bank officials in this country to be serving time for working with the Gulf cartel. Attorney General Dan Morales estimates that statewide less than one percent of the bankers involved actually know they are laundering money.

But whether bankers do enough to guard against accepting drug money is a matter of debate. Alonzo Peña, the head of the U.S. Customs office in Brownsville, told me that some bankers are purposefully blind to suspicious activity. “I don’t want to offend all banks, but banks are in business to make money,” said Peña. “Large deposits help them make money. And that’s a problem. The banking business is a very competitive business.”

The court cases uncovering the presence of drug money in Texas banks have caused significant consternation among lawmakers. Last year Congressman Henry B. Gonzalez, from San Antonio, suggested that an influx of drug money was the reason behind an inexplicable cash surplus of $3.2 billion at the San Antonio branch of the Federal Reserve bank. (The San Antonio branch routinely experiences a surplus, but in 1996 the surplus was $1 billion more than 1995.) “Since we know that many millions of dollars are being trucked into Mexico, deposited into banks, and then repatriated to ‘clean’ U.S. accounts, we can safely conclude that money laundering is a significant activity in the region,” Gonzalez wrote in a letter to the chairman of the House Banking Committee. However, the IRS conducted an investigation and found that the sources of the surplus couldn’t be clearly identified. Meanwhile, Morales has estimated that $30 billion a year in drug profits enters Texas banks.

In a way, it’s fitting that dirty money should come back to haunt us. On this side of the Rio Grande, revelations of widespread collusion with drug traffickers by Mexican officials have for the most part elicited the equivalent of a puzzled shrug—oh, inscrutable Mexico, forever unredeemed. This reaction ignores the substantial role the United States plays in the whole matter. We buy the drugs, for one thing. Our money is the currency of the drug business; the bills used to bribe Mexican officials bear the likenesses of American heroes such as Alexander Hamilton. Juan García Abrego amassed a fortune by following age-old capitalist advice: find a need and fill it. It’s not so surprising that a well-organized, lucrative business would want to put its millions in a safe place. And maybe it’s not so surprising that some American bankers, like the ranch hands in Soto la Marina, would go about their business as if they had never heard the whispers about what was really going on.

Citizen Abrego

On January 14, 1996, a group of Mexican police in riot gear hid in the shrubbery surrounding an attractive adobe-and-red-tile house in a rural area just outside Monterrey. For the previous several years, García Abrego had been leading a fugitive’s life, shuffling from house to house and ranch to ranch. His career began to unravel when Javier Coello Trejo of the Mexican attorney general’s office discovered he had been cheated out of some hush money. Coello Trejo turned on García Abrego, forcing the drug trafficker to go underground. Unfortunately for García Abrego, embarrassing revelations of corruption at the highest levels of the Mexican government had created a get-tough-on-crime climate for Mexican law enforcement. The police—who for years had not been able to track García Abrego down—suddenly knew where to look for him. After the cartel leader pulled into the driveway, he was ambushed, held overnight in Mexico City, injected full of Valium, and thrown on a plane for Houston.

In Matamoros, family members, including his uncle Juan N. Guerra, watched footage of the deportation on the television hanging from the ceiling of the Piedras Negras, while everyone else in the restaurant watched them to see how they would react to the news. García Abrego’s expulsion was highly controversial. Mexican law forbids the extradition of Mexican nationals (except in rare cases), but García Abrego was deported as an American citizen whose presence was “undesirable.” When he was 21, he made the mistake of acquiring a United States birth certificate, and even though the validity of that document has been questioned, U.S. authorities used it to bring him to trial in Houston. In October 1996 García Abrego was found guilty of smuggling cocaine into the U.S. and laundering money; last January he was sentenced to eleven life terms in federal prison and assessed fines and criminal forfeitures totalling $478 million.

Outside the Houston courthouse, little changed. Cocaine keeps flowing north and money keeps flowing south. The Gulf cartel remains open—some people say Oscar Malherbe has succeeded García Abrego and is running the operation from a Mexico City prison, while others maintain that García Abrego’s brother Humberto is now in charge. Either way, business is booming.

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