Cartel Tried to Infiltrate Top Ranks in Mexico

MEXICO CITY —  A series of accusations this week linked Mexico’s most notorious drug cartel to money-laundering scams that touch the highest levels of the nation’s political, financial and labor elite.

First, it emerged that the laundrymen of the Juarez cartel tried to buy a controlling share of a struggling bank. Then it was reported that they tried to go into business with President Ernesto Zedillo’s brother. And on Friday a newspaper said the head of the largest national labor federation and a union-linked bank were being probed for suspected money-laundering ties.

Prosecutors confirmed that the cartel attempted to purchase the Anahuac financial group but said the government halted the sale in 1996 when it became suspicious of the funding source. And Rodolfo Zedillo, the president’s brother, said his lawyers warned him in time to back off a proposed partnership with entrepreneurs who turned out to be alleged money launderers.

The chief spokesman for the labor movement said that Friday’s allegations against federation chief Leonardo Rodriguez Alcaine and Banco Obrero (The Workers Bank) were malicious and false.

Yet even jaded Mexicans have been shocked by the brazenness of the apparent attempts by the drug bosses to infiltrate the top tiers of business and politics.

At the same time, some analysts say the disclosures show the system is now working against a scourge that long went undetected. They say more vigilant Mexican investigators are armed with powerful new money-laundering laws and investigative tools, allowing them to achieve real breakthroughs.

A chastened Rodolfo Zedillo said in an interview: “It is obvious that the cartels have no respect for rank or hierarchy; they are definitely increasing their areas of influence. But our institutions are responding well. In our company’s case, [the traffickers] encountered good defenses that they couldn’t penetrate.”

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The national attorney general’s office said Thursday night that it has identified several suspects involved in the attempted purchase of the struggling Anahuac financial group on behalf of the Juarez cartel, which was led by Amado Carrillo Fuentes until he died after plastic surgery last July.

The prosecutor’s office said one suspect--Juan Alberto Zepeda Novelo, a top executive in Mexico’s second-largest construction company--was arrested Wednesday in the case.

The probe appears to be the largest since Mexico adopted stricter money-laundering laws last year. Mexico has long been suspected not only as a major transit route for drugs headed to the American market but also as a primary laundering channel for profits filtering back to the drug cartels.

The first of a recent series of high-profile cases emerged in January, when former Jalisco state Gov. Flavio Romero de Velasco, 73, was arrested on money-laundering charges. In one of the more startling aspects of the case, Mexican anti-drug chief Mariano Herran Salvatti disclosed that Romero’s maid was found to have a bank account containing $16 million.

In this week’s allegations, the common factor is Jorge Fernando Bastida Gallardo, identified as the main money launderer for the Juarez cartel.

Newspapers in Mexico City and Guadalajara said Bastida led the negotiations to invest at least $12 million in Anahuac on behalf of the cartel in 1995 and 1996. But national banking authorities said they froze that transaction before it took effect because they were suspicious of the money’s origin.

But federal prosecutors are investigating charges that Bastida laundered more than $80 million of the Juarez cartel’s money through Anahuac in 1995 and 1996, El Universal newspaper in Mexico City reported Friday.

Later in 1996, regulatory authorities seized control of the Anahuac group in connection with a separate fraud allegation.

El Universal also said prosecutors were investigating whether Rodriguez Alcaine, the labor federation leader, and the union-linked Banco Obrero had been involved in money laundering along with Bastida.

Netzahualcoyotl de la Vega, the federation chief’s spokesman, said the suggestions are “absolutely false.” He said Bastida had never been close to Rodriguez Alcaine, despite Bastida’s claims that he was an advisor and confidant of the boss of the electricians union.

The newspaper El Publico in Guadalajara reported Thursday that Rodolfo Zedillo, an architect, had agreed with Bastida in 1996 to form a company to buy land for a hotel project in downtown Mexico City. Bastida was to have invested $8.75 million in the deal--evidently with Juarez cartel money.

Zedillo said Friday that he believed Bastida and his partner to be legitimate business entrepreneurs who said they had the backing of the Anahuac financial group. When his lawyers questioned the pair about their financing, they disappeared and the deal fell through, Zedillo said.

“At first I believed that what they had wanted was information, that they wanted to rob very valuable information from us about the hotel project,” Zedillo said. He acknowledged that the intention may well have been to try to get close to the president’s brother and then exploit that relationship.

Raul Salinas de Gortari, the brother of former President Carlos Salinas de Gortari, is in prison awaiting trial on various charges, and Swiss authorities suspect him of involvement in money laundering, which he denies.

Presidential spokesman Antonio Ocaranza said this is not the first time that money launderers and other miscreants had tried to get close to or discredit members of the Zedillo family. He said the president had issued strict instructions to family members to avoid any appearance of impropriety.

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American officials have complained that few money-laundering cases in Mexico have led to convictions.

But Sen. Amador Rodriguez, a member of the ruling Institutional Revolutionary Party who helped draft the new money-laundering rules, said he doubted the crime was on the rise. “These are the same gangs, the same operations. But we are starting now to know who they are and how they operate.”

He noted that the money-laundering and organized-crime legislation adopted last year allows authorities to tap phones and film clandestinely, as well as trade lower sentences for underlings for information that traps bigger fish.

“All of this is starting to deliver results,” Rodriguez said.

Further, an elite, FBI-trained money-laundering police unit was set up in January with 30 full-time members, according to the attorney general’s office. Agents have carried out investigations in 47 cases, seizing nearly $460 million since 1994.

Strict requirements for reporting large or suspicious transactions go into effect April 1, and Charles Intriago, a money-laundering consultant based in Miami, was in Mexico City this week training employees of a major banking group how to implement them.

Intriago said the rules are considerably tougher than those in the United States because they require reports on securities and currency transactions over $10,000, not just on bank account transactions over that sum. All banks are being issued money-laundering maunals.