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Michican plane purchase shows kingpin El Chapo’s reach

Friday, January 6, 2017 10:16
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(Before It's News)

Posted by DD Republished from The Detroit News
(Thanks to the Anon. reader for the tip)
(DD;  That's the State of Michican, USA, Not the State of Michoacan, Mexico.) By Robert Snell , The Detroit News 
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 Detroit — Notorious drug kingpin Joaquin “El Chapo” Guzman’s cartel bought a luxury airplane from a Michigan company, but federal agents intercepted the plane before the pilot flew to Mexico, The Detroit News has learned.The revelation was recently disclosed in a federal court filing obtained by The News that chronicles international intrigue surrounding an airplane involved in a money-laundering caper stretching from a rural Monroe County town to Guadalajara, Mexico.

The case involves the most valuable piece of property ever seized by the Justice Department in Detroit, millions of dollars’ worth of allegedly laundered drug money, playboy narcotics dealers and a businessman who helped broker the airplane deal while trying to raise money for his wife’s fertility treatments, according to his lawyer.

Increased law enforcement and demand for fast, expensive planes that can haul drug kingpins and narcotics are forcing the Sinaloa cartel and others to shop farther away from states along the Mexican border and into the Midwest, experts say.

The case illustrates the inner-workings of the notorious Sinaloa cartel and shows that Mexican drug dealers are not merely selling narcotics in southeast Michigan, they’re shopping, too.

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Feds seized this Commander two years ago in Texas. (Photo: R.A. Swick & Associates)

 Federal drug agents seized the turbo prop Rockwell International Commander 690B two years ago in Texas and nobody tried to get it back.

“Nobody wants the plane except for the government?” U.S. District Judge Bernard Friedman asked a federal prosecutor during a recent hearing in Detroit.

“What’s it worth?” the judge asked Assistant U.S. Attorney Paul Kuebler.

“Almost a million dollars,” the prosecutor said.

“Really?” the judge said.

Notorious drug kingpin

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Joaquin (“El Chapo”) Guzman   (Photo: Eduardo Verdugo/AP)
The investigation dates to 2012 and was focused on “El Chapo’s” cartel.

At the time, El Chapo was the fugitive head of the Sinaloa cartel, the world’s most powerful drug ring. El Chapo and his cartel were believed to have access to billions of dollars and sold cocaine, marijuana, heroin and methamphetamine in approximately 54 countries.

El Chapo escaped a Mexican prison in 2001 and had been a fugitive for 11 years when the U.S. Drug Enforcement Administration launched an investigation that would eventually lead to Metro Detroit.

The cartel has deep ties to Metro Detroit.

From 2008-12, a branch of the Sinaloa cartel was importing up to 660 pounds of cocaine into Metro Detroit every month, federal prosecutors said.

Drug shipments typically entered the U.S. at the Mexican border in Arizona before being driven to Michigan. Members met at a warehouse in Wyandotte where the cocaine was unloaded and distributed, according to court records.

Drug ties in Metro Detroit

The cartel used an unlikely tool to avoid detection in Metro Detroit: Leo Earl Sharp, an 87-year-old drug mule from Michigan City, Indiana.

Sharp was arrested in October 2011 while trying to deliver 228 pounds of cocaine hidden in the back of his pickup.

“Just kill me and let me leave this planet,” Sharp said after a Michigan State Police trooper found drugs in the man’s truck.

The cartel relied on more powerful forms of transportation in Mexico.

El Chapo’s cartel had the largest air fleet in Mexico, larger than Aeromexico, the nation’s largest airline.

The cartel’s fleet served a network of 4,771 hidden airstrips lacing Mexico’s mountainous northern states.

From 2006 to 2015, Mexican military authorities seized 599 aircraft from the cartel, according to the newspaper El Universal. That fleet is almost five times the size of Aeromexico.

One drug run can pay for a fleet of planes.

Drug rings the size of Sinaloa can buy a plane for $1 million, load and deliver $10 million worth of cocaine and then torch the aircraft.

“Typically, a cartel or a drug-trafficking organization would employ small aircraft … to facilitate the movement of their product … or themselves,” Patrick Curran, a DEA special agent involved in the Torres investigation, testified during a court hearing. “High-level cartel members are typically fugitives. They can’t travel via commercial aircraft like you or I could, or by other legitimate means.”

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The plane was sold in May 2014 for $940,000. It is now in the feds’ hands. (Photo: Department of Homeland Security)

 Feds focus on sons

El Chapo’s sons were more closely involved in buying airplanes in the Midwest, prosecutors alleged.
Sons Ivan and Jesus Alfredo Guzman are known for flaunting their wealth and playboy lifestyles on Twitter and Instagram, posting photos of bikini-clad women, pet tigers, bikini-clad women with pet tigers, stacks of cash, a Ferrari with a gold-plated AK-47 propped against the dashboard and private planes.

In November 2012, more than a year after Sharp’s arrest, federal agents started intercepting the Guzman brothers’ electronic communications, court records show.

The investigation soon led to an email account used by a Sinaloa cartel lieutenant who worked for El Chapo’s sons. The lieutenant used the alias “Roco Loco.”

Fake name, real riches

In December 2012, agents learned Roco Loco and El Chapo’s sons allegedly were conspiring to launder more than $300,000 in drug proceeds, prosecutors allege.
The money was being spent on a 1982 Cessna Turbo 210 registered to a company near Cincinnati, Ohio.

The cartel used a middleman to negotiate and buy the plane, prosecutors said.

The middleman, Jorge Martin Torres, is described in federal court records as a high-level money laundering associate working for a cell of the Sinaloa Cartel. The cell was led by El Chapo’s sons, according to court records.

Torres, 40, lived in Mexico and traveled to the U.S. on a tourist visa, acquiring vehicles, properties and businesses for a range of clients.

“The inventory is millions of dollars. Lamborghinis, Maseratis, multiple BMWs, Mercedes…Porsches,” Curran, the DEA special agent, testified during an earlier court hearing. “Very high-end luxury cars.”

Torres was helping the cartel while trying to raise money to pay for his wife’s fertility treatments, his lawyer Albert Flores wrote in a court filing.

“They were desperately trying to complete a trial of expensive fertility treatments that would possibly allow them to conceive,” Flores wrote. “Money motivations to justify criminal activity under most circumstances are not unique.”

Emails monitored by federal agents showed Torres was involved in buying the Cessna in Ohio. One email from his account included an international wire transfer receipt showing payment from a bank account belonging to a company, Gasoestacion Ecologica, located near Guadalajara, Mexico.

“…Torres uses a network of money couriers/launderers who transfer drug proceeds through multiple means, including structured bank deposits, bulk cash smuggling and international wires, to obfuscate the source and origin of the funds,” DEA Special Agent Emilia Fernandez wrote in a court filing. 

“These funds are then used to purchase items, including airplanes, cars, high-end watches and other items.

The big-ticket items were purchased through straw buyers and, in the Cessna’s case, transported to Mexico.

In general, only U.S. citizens or permanent resident aliens are allowed to own aircraft registered with the Federal Aviation Administration. Individuals often use fake names, aliases or straw buyers to acquire and register aircraft involved in illegal activity or hide the true owner’s identity, according to the Justice Department.

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The Commander’s interior features a “potty” seat and mahogany tables and trim. (Photo: R.A. Swick & Associates)

   Trail leads to Michigan

When the cartel bought the Cessna in late 2012, El Chapo had been a fugitive for 11 years.
El Chapo escaped from a Mexican prison in 2001 and hid from authorities until being caught by Mexican marines in February 2014 in the coastal city of Mazatlan.

El Chapo’s capture didn’t crimp the cartel’s air demands.

In 2014, the cartel went plane shopping in Metro Detroit. Simultaneously, the Department of Homeland Security went fishing.

In early 2014, used airplane salesman Rick Swick got a surprise phone call at his office in Lambertville, an hour southwest of Detroit, near Monroe.

The caller was a Homeland Security agent, warning Swick that Mexican nationals increasingly were shopping for airplanes in the Midwest.

“Because if they tried to buy airplanes in south Florida, it’s easier for there to be a red flag,” Swick said he was told.

The Homeland Security agent told Swick to call if there was ever a suspicious deal. Two weeks later, in spring 2014, Swick called the federal agent.

“I told him ‘you’re not going to believe this,’ ” Swick said.

‘Just magnificent’

Swick told agents he was contacted by a Mexican national interested in buying one of his used airplanes, a 1978 Rockwell International Commander 690B. The plane was advertised on the company’s website and on aviation industry websites.

Swick was selling the airplane on behalf of Quarry Services, a Montana mining and hauling company.
Quarry used the plane to oversee operations in Montana, North Dakota, South Dakota and Wyoming, general manager Sam Buchanan said in an interview.

“It was a nice plane, as planes go,” Buchanan said. “We used it quite a bit when the oil business was doing really well, but we didn’t need it, nor could we afford it, after a while.”

The airplane — painted “Matterhorn White” and “Ming Blue” — with tan leather seats and wall-to-wall carpet, was overhauled with updated avionics and could top 300 mph, Swick said.

The propellers are mounted high on the plane’s wings, making the Commander ideal for landing on unpaved airstrips in rural outposts.

“For an older turbo prop,” Swick said, “it was just magnificent.

“It’s a really good airplane if you’re wanting to smuggle things out of a backwoods, short runway,” Swick added.

The sales pitch — “Simply the nicest…Commander available in the world!” — reached an interested buyer in Mexico.

The prospective buyer’s name sounded familiar to federal agents.

It was Roco Loco, the alias used by the Sinaloa cartel lieutenant involved in the Cessna plane purchased in Ohio two years earlier.

“He seemed pretty knowledgeable. Roco would email me, but I could never get him on the phone,” Swick said. “A question would come up and he’d say ‘I have a guy in the U.S. that handles all of this. Handle it with Wolf.”

That’s Wolf Hofman, who runs an air freight company in Laredo, Texas, a town along the Mexico border.

“Hofman is well known to members of law enforcement as being suspected in multiple illegal activities, including involvement with Mexican drug-trafficking organizations,” Kuebler, the federal prosecutor, wrote in a court filing.

Hofman has not been charged with a crime. He could not be reached for comment.

Digital breadcrumbs

There were other figures hiding in the background, however, who would lead to El Chapo’s cartel and family tree.

In February 2014, federal agents seized $675,851 during an ongoing drug investigation centered in Illinois. The investigation already had netted millions of dollars of drug proceeds thanks, in part, to wiretaps.

The investigation led DEA agents to Torres, the Mexican businessman who helped the cartel acquire the Cessna airplane in Ohio, according to court records.

Torres was helping the cartel buy the Commander airplane by relaying wire transfers and other documents, prosecutors said. He used his cellphone to exchange emails and text messages with a cartel lieutenant, leaving a digital breadcrumb trail for investigators to follow, prosecutors allege.
Torres coordinated payments from cartel front companies, including more than $233,000 in wire transfers in April and May 2014, according to court records.

One $76,511 wire transfer came from Gasoestacion Ecologica, the same Mexican company linked to the Cessna in Ohio, according to court records.

The cartel’s interest in the Michigan airplane surprised Swick. The Commander, with its updated avionics and powerful engine, was larger and nicer than the typical cartel airplane, he said.
“Usually, they buy s—,” Swick said.

The Commander likely was not intended to smuggle drugs, Swick recalls being told by the Homeland Security agent.

“(The agent) said this was going to be for executive transportation for upper-end members,” Swick said.

Lone Star state

The sale closed in May 2014 for $940,000 and the Commander was flown to a company operating at San Antonio International Airport in Texas.

Agents seized the Commander on May 12, 2014, before the plane could be flown to Mexico.
Federal agents allowed Quarry Services to be paid for the plane and Swick received his commission. 

The government kept the plane.

It is rare for federal agents to seize airplanes worth as much as the Commander. Nine airplanes worth at least $1 million have been seized by the U.S. government since 2011.

All were from states bordering or near Mexico, except for a $1.4 million plane seized last year in Anchorage, Alaska, according to Justice Department records.

Torres, the Mexican middleman accused of helping the cartel acquire both airplanes, was arrested after flying into San Antonio for vacation in October 2014, five months after the Commander was seized by agents.

El Chapo, meanwhile, escaped from a maximum-security Mexican prison in July 2015, fleeing through a tunnel built under his shower stall.

He was a fugitive for six months before being recaptured in January 2016.

Torres, meanwhile, was charged for his role in helping the cartel acquire the Cessna in Ohio and sentenced in November to 44 months in federal prison.

Last month, the Commander airplane was forfeited to the government and likely will be sold.

“Significant seizures like this one deal a blow to criminal organizations by cutting off potential transportation modes that support a wide range of criminal activity,” Steve Francis, acting special agent in charge of Homeland Security Investigations in Detroit, said in a statement. “The vast majority of proceeds from these seizures go right back into the community to counter criminal activity.”

Before he ordered the plane forfeited to the government last month, Friedman wanted to know where prosecutors had stashed the plane.

Prosecutors dodged the question and the hearing ended within minutes after the judge and his staff drooled over the plane.

“We looked at pictures,” the judge said. “We want to take it for a ride.”



Source: http://www.borderlandbeat.com/2017/01/michican-plane-purchase-shows-kingpin.html

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