FEARED FOR HER LIFE, SAYS DRUG MONEY DEFENDANT

Trial: Stockbroker testifies she attended crucial meeting only because she
had no choice.

A 28-year-old stockbroker from Mexico City testified Wednesday that she was
tricked into joining a scheme to launder money for the Cali drug cartel and
feared she would be killed if she backed out. "When I heard they were Cali
cartel, I knew I had no way out. I had to do what they said," Katy Kissel
Belfer told jurors in her Los Angeles federal court trial.

Kissel took the stand in her own defense after federal prosecutors rested
their case against her and five other Mexican nationals on trial in
connection with Operation Casablanca, the Customs Service's twoyear probe
of international drug money laundering. Kissel, a broker at CBI
International Securities in Mexico City, told of being invited to Los
Angeles on March 6, 1998, to present an investment plan to a group of
Mexican businessmen.

As she was being driven to the meeting at Emerald Empire Corp. in Santa Fe
Springs, she said, her driver told her that the businessmen were actually
members of the Cali cartel. She said she was shocked and asked to go back
to the airport, but yielded to the driver's insistence that she attend the
prearranged meeting. In fact, the men at the meeting were undercover
Customs Service agents carrying out a sting operation against Mexican banks
and financial institutions.

Federal prosecutors have built their case around secretly videotaped
meetings like the one Kissel attended at which recruits to the
moneylaundering scheme were told they were being asked to handle Cali
cartel proceeds. But Kissel's attorney, Michael Pancer, maintains that the
undercover agents' socalled Cali speech served to intimidate his client,
causing her to fear for her and her family's lives. He has outlined a
defense of illegal entrapment and duress.

On the stand Wednesday, Kissel traced her involvement in the scheme to a
chance encounter at a Jewish community social event in Mexico City. A man
with whom she struck up a conversation called her months later, offering to
introduce her to a representative of a group of wealthy Mexican investors
living in the United States, she said. "I was very excited because I
thought it was going to be a big account for me," she said. A few days
later, she said, she met with the representative, Rafael Gonzalez, who
helped her prepare an investment plan for the businessmen. It called for
putting up to $30 million in liquid shortterm accounts under a variety of
corporate names.

She said the plan was intended to circumvent notoriously corrupt Mexican
tax auditors. "If you have a large amount of money, for sure you're going
to have an auditor looking at your account," she told the jury. "And for
sure, he's going to find something wrong, even if everything is right. And
then he's going to ask for money to make it go away," meaning a bribe.
With plan in hand, Kissel flew to Los Angeles a few days later. She was met
at the airport by Ernesto Martin De La Torre, a driver sent by her hosts.
Once they were on the freeway, she said, Martin told her about the Cali
cartel connection. "I told him I just wanted to go back," she testified,
but she said Gonzalez insisted she meet with the businessmen first, since
they had paid for trip to Los Angeles. "I was in the car with a strange
person. It was late at night. There was no way for me not to go to the
meeting," she testified. Asked by Pancer how she felt when she came
facetoface with her hosts at the Santa Fe Springs meeting, Kissel said, "I
felt scared and intimidated, sir." After giving her the Cali cartel speech,
undercover operative Fred Mendoza tried to reassure Kissel, saying, "We are
not bullies, we are financiers," according to a transcript of the
videotaped meeting. But under questioning by Pancer, Kissel said she was
not reassured.

"I thought he wanted to let me know in an easy way that he was very
dangerous," she said. If she had walked out of the meeting, she said, she
was convinced "they would have killed me." Three days after her trip to Los
Angeles, Kissel arranged an urgent meeting with a Mexico City lawyer who
has represented her family in business matters. Testifying before Kissel
took the stand, attorney Jose Salvador Rocha Rodriquez said she was "very
upset" when she came to his office on March 9, 1998. Because of rules
against hearsay, he was not allowed to divulge what Kissel told him. But he
said he told her she had two alternatives, one of which involved "taking
care of her own safety and her family's." Kissel was arrested last May 16
with scores of other defendants who were lured back to the United States on
a ruse. She has been in custody since then, accused of laundering $1
million in drug proceeds.