DRUG TRAFFICKERS

"STEVE"

I was born in Tijuana in 1961. I was there for about four years and came
back to the US. My brothers were born in the US. On my mom's side, I came
from an upper middle-class or upper-class family. My grandfather was an
appellate judge in Mexico. My dad's a Texan. So from kindergarten
on--actually, from nursery school on--I was in San Diego and lived your
normal upper middle-class life that regular American kids do.

On that part of the border, there's kind of a transnational family
structure. Do you breach both sides?

When you live in San Diego and Tijuana, especially in San Diego, you go
across that border like it's one big city. And you don't realize the
privilege you have in doing that. It just seems to be tedious because they
put this border there. I had an aunt whose house was on a mountainside in
Tijuana. We'd call her and ask, "What's the border look like?" And she
would look with her binoculars out her window and go, "Oh, stay wherever
you're at," or "Go have dinner," or "Come over to the house. The line's at
least two hours right now. Don't even try. Wait until it dies down." This
is before radio. Now there's a radio that every 15 minutes tells you how
many cars there are. And this is before the DEA and everybody put up on the
American side so the border is long now on both sides. It used to be that
the only borderline you would make was coming from Tijuana, Mexico, into
San Diego.

And in those days, when Tijuana and San Diego were smaller towns, you guys
and your families were really part of an elite?

Well, yes. We all went to the country club in Tijuana. And then, Tijuana
was probably half a million, a million people, at the most. And most of
those people . . . weren't upper middle-class. Our uncles . . . were
somebody in society, so that your name was very well known. . . . Who you
married was very important, who you hung out with, who was at the country
club. Those families were very special, and it was a very small town when
it came to the privileged crowd.

And you all went to the same high school in San Diego?

Well, most of us all went to Augustine. It's an all-boys school. Most of
the girls went to Our Lady of Peace. If you went to school in Tijuana, you
went to. . . an elite school. There are other ones, but at that time
everybody went there. For example, my father went to Augustine, my little
brother went to Augustine, I went to Augustine. And almost everybody of the
elite from Tijuana went to these schools.

So, if you got pulled over by a cop, they'd either recognize you, or as
soon as they saw your license, they'd know who your father was or your
uncle was or somebody like that. So, pretty much at that age in those days,
you had free license to do whatever you wanted to. Even if you were caught
drunk, even if you hit a telephone pole, they'd call your parents or your
uncle first. They wouldn't put you in the same prison cell or the same jail
cell in the county jail. They would take you to the office and then call
your parents or your uncle and say, "Let's fix this. We have a problem
here. Let's take care of this business here," without making a big thing
out of it. So you were very, very privileged. That's something that's
almost unheard of now.

And eventually you became an attorney?

Right. I got tired of being a stockbroker, went to law school and became an
attorney. My intention was to become a securities attorney. As a
stockbroker, I'd see them. They were getting paid as much as me, or more,
and weren't out doing as much hustling as I was. I was living in planes and
hotels at the time. I opened my office right next to an MCC, right across
the street from the federal courthouse, so it was just perfect. That's the
best location there is in San Diego to have a law office for criminal
defense--ninety-eight percent of my cases were drug traffickers, drug
trafficking charges.

So you had ninety-eight percent drug trafficking cases, because that's what
was in the MCC?

Yes. So then they send me a client. They tell me how much to charge,
because they already interviewed this client. They know what he owns, what
he has, how much cash is available. And so they tell me by phone, "Steve,
just charge him ten grand. It won't be a problem." I charge him ten grand,
which to me at that time was just an unbelievable amount of money. And, lo
and behold, he comes with a shoebox, puts it on my desk, and he goes "Count
it."

And I opened it. I got that aroma of dirt, so that money must have been
buried. And in fact, later on, when we tried to use money counters, a lot
of times it wouldn't work because the money was either wet or it had dirt
on it because of the ways they hide the money and where they hide the
money. But anyway, he gave me the $10,000 as my first drug client. And from
then, I never looked back. It was big clients. Money. Cash coming in. I had
$40,000 almost every day in the bank account, in my trust account, of money
that was coming in all the time. And it was all drug trafficking. I knew
when it was the pot season and I was going to get border bust cases, I had
to charge less. If I knew it was coke season, it was going to be more coke
cases, and I could charge more. Then when crystal meth cases started coming
in, they were so penalized I knew I could charge even more. They were
usually were white guys, at that time. And the coke guys were either
Mexican or Colombians. And the pot guys were almost always Mexican. And so
we knew how to price. We knew the seasons. We knew the dry seasons. We
learned the pot world and the cocaine world and the drug world just by
being attorneys, because we could tell after a while, cyclically, what kind
of clients we were getting. And that's how I started. That how I started
being a defense attorney.

So you're making good money, and a lot of clients coming in?

Very good money. Right.

And you started traveling into Mexico?

Well, first I started with Colombia. A lot of them would say, "Okay. If you
need that kind of money, it's not a problem, but you need to fly to Cali or
Medellin or Bogota and meet my brother or my father or my wife or my sister
and talk to them. Tell them exactly. Take the paperwork. Show them what's
going on. Plus, you're going to save my life, so they know I didn't steal
this. They'll know how the bust went down." So my job was to go down there
and make sure that people understood what's going on.

To understand that they didn't get ripped off?

Right. For example, once I flew down to Cali to meet a client that owed me
$2 million. Before we arranged the $2 million, I had to get the okay from
his brother. And so I flew to Cali, Colombia. I get there and I have a
room. I stay the first night. It was great. Hey, I'm going to Colombia and
this is exciting. I'm young and I'm getting a lot of money and this is
really cool stuff. This is what you dream about in law school.

So I get there. The second day they pick me up, take me in a cab, put me in
another car, put this black thing around my eyes like a bandage, and tie
it. And they go, "We're sorry. I hope you understand." Not a problem.
Something in me knew. . . I was never really scared. I was an attorney
trying to help them. Why would they hurt me? And they put me in a car. They
go, "Now don't get worried. We're going put you in a helicopter and you're
going to hear the thing and we're going to go to my uncle's ranch." I said,
"Okay. Fine." About 15, 20 minutes later, I land and I'm on this beautiful
ranch. I don't even know why they call it a ranch. It looked like a
mansion. It had like a little miniature zoo and it was just fabulous. It
was like the "Lives of the Rich and Famous," and more. Just incredibly
beautiful homes. But they call them "ranches."

I met the people there and pulled out my briefcase, pulled out the
indictments, went through the photos, through the evidence. Meanwhile the
person's just sitting there. Very unemotional, just looking at you and
studying you. They know they got you. You're out in the middle of nowhere.
If you're a fed or something, you're never going to go back, but maybe
they'll let you go back. They're not going to say anything.

So I stayed there for about four, five days, and then went back. They said,
"If you come through with what you say and you give that result, we'll pay
you $2 million." And lo and behold, my whole thing with this client at that
particular time--he was a very high person with cocaine in the archives of
the US Attorney's Office, in fact I think they were partners of Pablo
Escobar--he had already had an attorney in Beverly Hills. He had already
cut a deal for ten years. There were nine or twelve of them--I can't really
remember--in the case and it was a package deal, which they all must sign
or nobody signs and they all go to trial. It's a package deal. It's not
individual.

And he told me "Any year you get me less than ten years, I'll give you a
million dollars, up to five million." And I said, "Okay." I didn't think I
could get him five years off, but I'm sure I could get him something. And
if not, I didn't lose anything. I got a beautiful trip. And lo and behold,
the day of pleading comes. And I hold out. So everybody's totally pissed
off, including the US Attorney, the judge. Everybody's going berserk. Now
you're talking nine trials--one trial with nine co-defendants, nine top
attorneys. You're talking a month, six weeks, a two-month trial, for sure.
Nobody wants that. The US Attorney's Office is just, like, yelling at me.
Finally, we agree upon eight years. So everybody got 10 years and my client
got eight. He was happier than could be, and they owed me $2 million. And
this same client later on facilitated me in my other ventures. The big boys
had talked with each other inside MCC that I could be trusted. So now I was
flying to Culiacan in Mexico.

Tell me about Culiacan.

Culiacan is considered like when Al Capone lived in Chicago or New York.
The drug traffickers, Felix Gallardo, Caro Quintero, all the big boys that
are said to be big boys from Culiacan in Sinaloa. There's a place called
Tierra Blanca--White Dirt? But what they mean by it is that there's so much
cocaine being trafficked at Tierra Blanca that it's called "the white town."

So it's like the capital of narcotrafficking in Mexico?

Yes. So, now I'm going down there and I'm meeting people. I'm also going
down to the prisons in Mexico to meet some of the very top cartel members
that are still running the cartel from inside. They have these beautiful
cells. But they have 12 of them. One is a dining room. One is a theater
room, and I'm talking high-tech theater stuff. That was one cell. The other
cell was for a party. One cell was for the lover, the other cell was for
the wife. It's just immaculate. They have their own rose garden. . . . They
were paying the right people to live very nice. So now I'm staying with
these people. I'm like almost one of them. And my whole thing at this time
was to get clients, because these guys have guys going down all the time.

You talked again about contracts, about moving a load from Colombia or from
Mexico . . .

Well, the load is a whole different animal, and it depends on what kind of
load. Coke is worked one way, pot is worked another way, crystal meth is
worked another way, heroin is worked another way. I really worked pot and
coke. A cocaine load, obviously, originates in Colombia. And if you go
backwards, the load's already facilitated to you in the United States. New
York has the highest price. L.A. has the cheapest price. L.A.'s really like
the marketplace. As it goes to New York and other places, it gets more
expensive. At the time I was doing this, it was $16,000 a kilo.

So the Colombian will tell me, "I have 500 kilos or 200 kilos or 100
kilos." Anything under 100 kilos is not really worth the risk to do. So
usually it's 300-500 kilos--half a ton, a little less. And they say, "The
going price is $16,000. I'll give it to you at $15,500. You'll make 500
bucks a kilo." "No, come on, man. Don't be doing that to me. I've got to
pay my people off. By the time I pay everybody off, I'll be making $100 a
kilo. It's not worth it to me. If it's going at $16,000, give it to me at
$13,000." So again you negotiate. You reach a price. Let's say it's going
at $16,000; they'll give it to me at $15,000. So now I make a deal. You're
going to front me that cocaine, because nobody can buy 500 kilos. If you
get a client that can buy 500 kilos and pay you at the same time, it's
Uncle Sam who is buying it from you. You're going to get caught at the same
time. Nobody does that. Nobody has that kind of cash available. Or if they
do, they're not going to move it. People are buying from 5, 50, 100. To me,
it's on credit.

Now I make a contract. Let's say you're the Colombian. I make a contract
with you. I need seven days to move it and have the money here, in LA, back
to you. Let's say the people that moved it for me had clients. This guy's
going to buy 50, this guy's going to buy 10, and my best client is going to
buy 100. . . . The shit that got all smashed up is what the crack dealers
will buy to make crack out of it. So you have different clients for
different type of product.

The kilos come stamped. The best was Rolex. They used to come back with a
stamp from Colombia stamped Rolex. Ones were stamped with Clinton, ones
were stamped with Bush. . . . Sometimes it got crushed, though. So that
stuff people didn't really want to buy you sold to the crack dealers
because they don't care. They're going to break it down anyway, and make
crack with it. So now you make the deal. "Seven days." "No way. You're
going to sell it and resell it, work it yourself. You've got three days."
"I can't do it in three days." So you settle on five. Now I have five days
to just sell my stuff, so they're giving you half a ton, 300 kilos, on
credit, for five days. And I have to have that cash back in five days.

Sometimes a load goes down. You'd better have the indictment. You'd better
have everything that that client, the guy that went down with it, to show
the Colombian, "That load got busted. Here it is." They'll hire an
attorney--like me, at the time--to represent that client. I make sure he
doesn't snitch, make sure that everything he said is true, the amounts of
kilos. And if he's going to snitch, don't say, "I'm working for the
cartel." Find out what he's going to snitch about, and let the cartel know
what he's snitching, so they can move the numbers and their things around.

So as soon as he's done being debriefed, I'm calling the cartel and letting
them know what he got debriefed about. So that's if you get it in LA. You
can get it in Mexico, probably about half the price in Mexico. But then
you've still got the transportation cost to get it to the border and jump
it. The other way is for you to go to Colombia and get it. That's the best
way, if you have the means to do it. And the means to do it, for example,
in my case, was . . . to have a boat, a little bit smaller than a tuna
boat, which hold about seven tons in a double hull of the boat. And the
first time we did it, we did it for three tons.

You go down there, and there's different ways. You can either buy it on
credit at $1,500 a kilo--you've got to sell it at $16,000. It sounds like a
lot of money, but there's a lot that happens and a lot of people you've got
to pay between getting it in Colombia that they're not going to give it to
you in Colombia, and I'll explain that to you, to get it to the United
States. That's a long process.

But you go down there. You could either buy it for $1,500 a kilo, $2,000 a
kilo. You negotiate the price. But it's very, very low. There's so much
coke, they have hoards of it. Or you go, "Look. My boat can take three
tons. Half of it will be yours; half of it'll be mine. I will move your ton
and a half and sell it. The going price is at $16,000. I will sell it at
$15,500 for you. And I will sell my load. When it's all done and sold, I
give you your money. I keep my money. And that's it." So you get it free,
basically. It's not really free, because you're going to spend most of your
money transporting and paying to get it to the United States.

So that's another way of doing it. A lot of times they'll go, "Okay. But
sell it at $16,000, at the going market price." "Okay." Hands shook. If it
moves up there, we're staying at that price. Now you're taking a chance,
because the market can get glutted and that goes down to $14,000. That
happened to us once. We got stuck with kilos, 150 kilos at $16,000 that we
still had left and the market fell to $14,000.

It sounds like a commodities business.

It is a commodities business. It is exactly a commodities business, but
you're not moving pork and you're not moving cows and you're not moving
petroleum. You're actually moving coke, in that case, or pot in another
case. It is a commodity, especially with the cocaine business. It is a
commodity. . . .

In my case, we took two boats, and they flew their planes out to a place
called the Scorpion Triangle, which is about three hundred miles in
international waters, in front of Panama. They bombarded the kilos. They
seal them in a way that they can take the shock and they won't burst open,
and they're also waterproof. It looked like we're fishing out there. Our
men, our captains, are actually out there fishing. They dump the loads into
the ocean and go out in to pick it up--put it in the hull, and then dump
all the fish we're catching. We make it look as good as possible. And you
have a decoy boat. So one boat picks up and fishes. The other one's
fishing. If, for any chance, there's a Coast Guard coming--because usually
it's the US that'll bust you--if you see a Coast Guard coming or something,
and submarines have done the busts sometimes--that decoy starts hauling
ass. Everybody goes after that boat. That other ones goes and just finds a
cove or something, somewhere to hide out of international waters.

So that's the way we would do it. Then you bring that boat up. Again, you
pay somebody not to look at the radar for a certain amount of time at a
certain hour at a certain day. He charges very much, and sometimes they
won't do it on credit. Sometimes you've had to pay him up front. So to work
that kind of load of three tons, you'd better have $2 million-$3 million
dollars that you're going to invest before the load even gets dumped onto
you. You'd better have everything and everybody already set all the way
through the chain, all the way to L.A. That means you'd better have
everybody paid, from interception to federales to Mexican
marines--everybody paid along the coast--stashers, protection, everything.
Because now it better work like a Swiss clock. Nothing better go wrong. And
it always does, but you know that, your idea is to run it.

So you've got money out there already. You've got a million and a half, $2
million out before it even gets dumped in the ocean to you. And now it gets
dumped. Now you load it. And you bring it all the way up, in my case, out
to Rosarito, about three miles out. You bring it to shore in Zodiacs, to a
very affluent mansion, to a very dignified person that's above suspicion.
And we stash it there. We still got everybody paid off. We got the Mexican
marines that patrol Rosarito and Encinada and those areas paid off. We got
air surveillance paid off. We got the patrol cars that are going to carry
some of it. We got the truckers that are going to come in.

The patrol cars? What are you talking about?

Federale caminos. Usually, you don't pay the driver--you pay the
comandante. And when we get into the pot, we'll have exactly how we pay the
army to bring in airplanes into a clandestine field. We've done that before
too. That's another way. But the first time I did it in a big way was
through boats. If you're going to bring it in to Tijuana, you've have to
pay the Arellanos. That's their property. That's their place, and you've
have to tell them, "I'm bringing in so much. What are you going to charge me?"

Tell me about the Arellanos

Historically speaking, they started off as a family from Culiacan. They
moved to Tijuana and had very good contacts that could insure your load
would be safe. But you had to pay for it, obviously. Usually you already
dealt with them. You don't arrive with the load. You've already talked to
them, and usually you've told them it's a little less. Or sometimes you're
honest, if they're going to be present. And you don't know if they are or
not. That's another risk you take. But a lot of times it's "la bravada,"
it's called. You don't tell them. And you hope everybody kept quiet and you
hope nobody that's working for you has ties to the Arellanos. The biggest
problem is somebody saying something stupid, somebody opening their mouth,
in other words.

So almost like an insurance company? They would insure that you would be
safe . . .

Yes, but an insurance company doesn't hurt you or cause you harm if you
don't pay. They just bring a lawsuit. The Arellanos are very amicable
people, very fair people. If you let them know you're going to bring a
load, they'll even help you bring the load in. However, if you don't and
they find out, they'll probably kill you or kill someone of your family.

The two most dangerous points is when you receive it in the water or the
plane comes in from Colombia, and the second most dangerous point is
getting it across the border. And everything has a cost. For example, if I
drop a load in Mexico and it gets busted, usually I can figure out a way to
pay the right person to get my load back. But that was more money I had to
spend. That's why I said it cost $3 million to just get the three tons of
coke before you even sell ounce one. That's because you'd better have a
million in cash for emergencies. Two million dollars you pay to captains.
And it's not just the captain. It's him and his crew. There's got to be an
engineer on there, and a navigator, and a mechanic.

What happens when you cross the border?

Most of the loads you bust are pot. Twenty percent of your cars are going
to get busted at the border. The other eighty percent is going to get
through. I know that, because that's how I used to do it. I used to send 12
cars at a time. The way I figured, as long as six cars--fifty percent--got
through, I was making a good profit. I'd bring in cars from the
gangbangers, stolen cars, and I'd make them legitimate in Mexico from
junkyards. Now they're a legit car that cost them $200--a brand new
Suburban, a brand new Cherokee with professionally made stash holds. I had
a guy who actually trained the dog for the DEA, who would make sure that
his dogs were trained not to smell my loads. I'd just flood the thing. I'm
only one of hundreds that would do that. It's the cost of business. You're
making so much money that it's a cost of business.

A lot of times, you do go broke, though. There is that risk. Not every drug
dealer is rich, and not every drug dealer stays rich. I want to make sure
that's clear, so that kids don't think they can get into this business and
they're going to get rich. That's not the way it works. It takes a long
time to make real money in this business. It takes a long time, it's very
risky, and it's very hard. It takes investment. It's a business. It takes
know-how. Just because you become a drug dealer does not mean you make
money. A lot of times you lose your ass and you're broke, and you're
selling your legitimate stuff to pay off the load you lost.

You said before that you called yourself a "junior." How did that help you
deal with the Arellanos?

The Arellanos were very entrepreneurial in that they lured these kids into
working the trade. And they had contacts with the comandantes. They had
contacts with top people that they could pay off. For example, a comandante
doesn't have to pay off his soldiers. What he can say is, "Next week we're
going to have combat practice and then go north," because you're bringing
in your load through the south. It's above suspicion. You pay that general
or that comandante. He takes his troops out to the sticks to do their
little mission practice or whatever during the time you're bringing in that
load. But unfortunately, there are different people from . . . different
groups, the state, the federal army, marines. . . . So, depending on where
you're bringing your load in, you've got to take care of these groups.
Sometimes one group, sometimes all, depending.

But by the time you get working well, you've already met everybody and
everybody knows everybody. It's a very small circle. Everybody knows
everybody. And that's where the problems start occurring, because before it
was the drug dealer who lived and went to those restaurants, to those
clubs. And the juniors and their families went to those restaurants and to
those clubs--separated. When the juniors became involved, they started
mixing. People didn't like that. People from good families started getting
killed. People didn't like that.

For the first time, the heat started coming down on the government, from
people that had a voice. And that's what started this big trend of real
heat. Everything started coming out to the open. Because now real people,
powerful, legitimate people, were bringing in heat to tell the government,
"What the hell are you doing about this problem? Now they're sucking in our
kids. Now they're sucking in our culture. Now they're mixing with our
crowds. Put a stop to these guys."

But they didn't.

Of course not. They pay for protection. When you have a lot of money, you
can pay the right people at the right time.

Why would the children of the small privileged group in Tijuana, like
yourself, get involved with the Arellanos, who are killers?

The definition for "killers" that's used in the media is different than the
reality of killers, of killing. There are contracts made. And when people
get killed, it's because those people ripped off a load or did something
they weren't supposed to in the verbal contract, and were given umpteen
chances to fix that problem. Or there's a snitch. That's just a rule: you
snitch, you die. So when you say "killer," it's not like people are out
there, like the gangs were for a while there, doing these drive-by
shootings and killing all these innocent people. No. If innocent people are
killed, it's not intentional. It does happen at times, and I'm not
defending anybody, but I don't like the way sometimes they say, "Ah, these
guys just kill everybody." No, they kill for a purpose.

But why would you get involved with these people?

There are several reasons. One is Hollywood--the fame. It's not the
juniors' fault that they made all these gangster movies and they portrayed
everybody so romantically, like the Godfather--Al Pacino, the Corleones,
Scarface. They make all these romantic movies. Everybody loves these
characters. So they get to junior. And junior is a 22-year old, 25-year old
or a 30-year old--still young, dumb, barely starting off on his own. But
they like the Porsches, that's the problem. And now all of a sudden, since
the mixture of classes . . . Before, you would see somebody with a brand
new Porsche, and think, "Ah, drug dealer." All of a sudden, when it started
getting mixed, you couldn't do that anymore. You couldn't say, "Wow, look
at so-and-so with the Porsche. Probably his dad bought it for him, or their
business is going good." Now you couldn't just say "drug dealer." You had
to be careful, because maybe that guy wasn't a drug dealer. Maybe he was.
But he's above suspicion because his dad owns a big company.

You're already privileged. You live in a nice area of Tijuana or San Diego,
Bonito, L.A., La Jolla, Coronado or something. You're driving a decent car.
Your tuition is being paid. You're going to a nice school. But you're not
driving the Porsche, the Lamborghini, the Ferrari, the Mercedes, the new
Beamer that just came out. And you want that. And guess what? A couple of
your friends that you grew up with have that, and they're dealing with
these guys. You know somebody that can help them out, so you talk to them.
And before you know it, you're involved with it. Now you're involved. Now
you're in.

In ninety-five percent of the cases, the parents don't know. The parents
believe the kid's business is going well. He's got a business, he just
became a dentist and his practice is going well. Or he has a stereo shop
and the stereo shop is going real well and he got a great deal on this car
and that's why he's got a new Mercedes. It's a fallacy that you can't get
out. You can get out. Nobody cares. The fewer people, the better; it's less
competition. It's not like that Cosa Nostra thing, "Oh, you're in. Now you
can't get out." Bullshit. You can get out any time you want. As long as
you've finished your contracts, you don't owe anybody, and you're okay.

Why aren't the Arellanos taken out or replaced?

Why the Arellanos haven't got caught, I don't know. But the $2 million the
government offered is just a joke. Unless you really have it well planned
and well devised and you actually trust the government to pay you, you're
not going to get involved in trying to take them out. And they don't travel
by themselves. For example, when the Arellanos go have lunch at Puerto
Escondido in Rosarito, it's closed down, either by the feds or just by all
the Arellanos' people. They might come in a helicopter, have lunch, and
they're gone. They're not that accessible. It's not like, "Oh, they're down
the street on a certain block, on Fifteenth Street, in that white mansion."
They've hit their mansion several times. But a lot of times they have
somebody along the chain of authority that intercepts the message that
they're going to hit a certain house or they've been seen. And they'll get
the message before it happens. So the house gets hit, and they're in
another one of their houses.

What about corruption on the US side?

If you get a corrupt US Customs agent, when I was in the business, they
were charging, I believe it was 30 grand a carload. And they don't care
what it is in the car. It could be a body; it could be drugs; it could be a
hundred kilos; half a kilo, a ton. Obviously, usually you're paying up
front 30 grand. And usually you're packing that car to the hilt, getting it
across. And he'll fly you. He'll let it go by. There is definitely
corruption in the Customs agents.

You also got into money laundering as part of your activities. What does
that mean?

Money laundering is taking cash money--Benji, Benjamin Franklins, fives,
twenties, tens, hundreds--and making them into paper. That's all money
laundering is. It's taking cash money and then reducing it to paper money.
Once it's reduced to paper money, anybody will accept it. Not everybody--in
fact, very few people nowadays--will accept cash money, especially in large
amounts. It's a whole art form to convert it from cash money to paper
money. And paper money could be off of wire transfers, when I say paper
money, because it'll be paper at some point in time in somebody's account
or in somebody's ledger. On the US side, you have very sophisticated, smart
DEA agents and Secret Service agents and IRS agents and even very smart
canine agents looking for the money. Everybody wants the money.

It's a very high commodity. And it's not just the dollar figure amount.
It's all the work that went into taking loads of drugs from a certain
origin in Mexico or Colombia all the way into the United States, stashing
it, selling it, breaking it down. Ah, just so many things go into it that,
by the time you actually have cash, there's been a lot of work. In fact,
probably one quarter to half of that money has been spent. In other words,
if you're bringing in $9 million, out of that $9 million, it probably cost
$3 million to $4 million to make that $9 million. So whoever receives that
$9 million has to pay a lot of people that are still owed money. When a
load of money goes down, it's a lot of headaches for a lot of people,
because a lot of people are owed money. A lot of people fronted their services

How did you do it?

Let me give you a realistic scenario. My Mustang convertible held $5
million in $20 bills in the trunk. That's about as much as I ever got into
it. Crossing the border going south, as soon as I get into Mexico, I'm a
money launderer. I haven't yet converted the money, but I took the money
out of the country illegally. You have to declare anything over $10,000.

You just make sure there's nobody checking the border. You have your guys
out there looking to see if somebody's going to go through or not. In other
words, if they see that there's DEA out in San Ysidro, that means there's
nobody up in Otay. And just dial you on your beeper and put all sixes, the
sign of the devil: don't cross right now. So you know if they put seven in,
that's the good luck number: let your money go through. There's nobody
checking. The Mexican guys? Don't worry about them. We'll take care of
them. They know us. That's taken care of.

The business works on the basis of contracts?

Everything is a contract. Just like a commodities contract, except it's
verbal, but it's signed by your blood, basically. If you breach a contract,
you'd better have a good reason, and you'd better fly down to Colombia--or
Mexico, if you're dealing with a Mexican cartel--and show your face and
explain the situation.

For example on the money laundering side, you say, "I can take the cash and
I can have the cashier's checks in five days at seven percent." They'll go,
"No. Three days at five percent "No. Six days at 6.5 percent." "Okay. Done.
Six days at 6.5 percent." Boom. So by this time when you're doing this,
you're in contact with the bank at the same time. "When can we do it?"
Because sometimes they get audited, and so that we have to shut down.
Sometimes it's, "Don't come on the first or on the fifteenth because we
can't give you any cashiers,"--the girls who count the money. They don't
trust the machines, or the machines have problems because the money's wet,
or the money has drugs on it. There are all kinds of problems with the
money-counting machines. Half the money can't be counted in the
money-counting machine, because something's wrong with that bill.

So the girls count it. You have to sit there, and you literally don't move
your eyes for four or five hours at a time while these girls are counting.
If you even just cough, those girls are so good, that two, three hundred
dollars are on the floor. You didn't even see them do it. So in four, five,
six hours, two days, three days straight of counting money, these girls'll
take you for ten grand. They are good.

So you count the money. And what happens is sometimes you can only move so
much out in that three-day span. Meanwhile, these Colombians are forcing
more money and more money and more money on you, "Move this money. Move
this money." But the banks can only take so much at a time. So now you're
using their vaults. It got to the point where I had a special number, that
when I would drive up to the bank I had the actual code, so the bank's door
would open and I could drive in like the Brinks trucks would do. And they'd
send their guard.

And this is in Tijuana?

Right. So you get this backlog of money in the vaults. The Colombians would
get that counting all mixed up, because you're not just dealing with your
loads. Now you're out laundering money for a lot of different Colombians or
a lot of different loads. So we're trying to keep the accounting. And I go,
"You want me to launder the money? I'll launder the money. I'll send a wire
transfer or cashier's checks. But don't tell me to remember that Joaquin
sent you $200, 000 and Gerald over here sent you a million and this guy
sent you $250. I can't keep track of that stuff. I'm taking the money and
I'm making sure it's going out."

And then that's when the problems sometimes occur. "Well, there's money
missing." "Well, how much is in the vault?" The banks are very
professional. They can't be letting you in the vault all the time counting
money. People are looking and wondering, "Why does this guy get so much
attention? This guy just walked in the vault and he's counting money in
there." The banks have to be careful, too. So it's a problem, with these
backlogs of hundreds of thousands of dollars in the vault, and more money
coming in. You've got cars sitting outside in the parking lot with $2
million, $3 million in the trunk, money in the vault, and transfers going
out. It's very complicated shit at times.

[part of a series]

Campaign for the Restoration & Regulation of Hemp's HempTV website now has
the full, two part, total of almost 4 hours of video of the PBS Frontline
"Drug Wars" available on the web for free video streaming using the Real
Player 8.

To watch Part one of Drug Wars, go here:

http://www.crrh.org/hemptv/docs_drugwars1.html

To see part 2, go here:

http://www.crrh.org/hemptv/docs_drugwars2.html

Click this link for an index to this series:
http://www.mapinc.org/drugnews/v00.n1551.a01.html