Federal Prison Terms Handed Down in Multi-Million-Dollar Money Laundering Conspiracy Involving Los Zetas Drug Trafficking Proceeds, Extortion, and Bribery
|U.S. Attorney’s Office September 05, 2013|
In Austin this afternoon, three men, including Jose Trevino Morales, the brother of purported Los Zetas leaders; Miguel Trevino Morales (aka “40”); and Oscar Omar Trevino Morales (aka “42”), were sentenced to lengthy federal prison terms for their roles in a complex conspiracy to launder millions of dollars in illicit Los Zetas drug trafficking proceeds to purchase, train, breed, and race American quarter horses in the United States, announced United States Attorney Robert Pitman; FBI Special Agent in Charge Armando Fernandez; Richard Weber, Chief, Internal Revenue-Service Criminal Investigation; and DEA Special Agent in Charge Javier Pena.
United States District Judge Sam Sparks sentenced Jose Trevino Morales, age 46, of Balch Springs, Texas, and Francisco Colorado Cessa, a 52-year-old Veracruz, Mexico businessman, each to 240 months in federal prison, followed by three years of supervised release. Judge Sparks also sentenced Fernando Solis Garcia, a 30-year-old horse trainer and purchasing agent from Ruidoso, New Mexico, to 160 months in federal prison, followed by three years of supervised release. Judge Sparks also remanded Garcia into federal custody following today’s hearing.
“The activities of Mexican drug cartels have taken a terrible toll within Mexico. This prosecution and the sentences imposed today should send a clear message to those who would attempt to import their brand of corruption and violence into the United States. We will find you, we will prosecute you, and we will seek the most severe consequences the law allows,” stated United States Attorney Robert Pitman.
On May 9, 2013, a federal jury convicted Jose Trevino Morales, Francisco Colorado Cessa, Fernando Solis Garcia, and Eusevio Maldonado Huitron of one count of conspiracy to commit money laundering. Evidence presented during trial revealed that Los Zetas is a powerful drug cartel based in Mexico that generates multi-million-dollar revenues from drug trafficking. Since 2008, Miguel and Oscar Trevino Morales would direct portions of the bulk cash generated from the sale of illegal narcotics to Jose Trevino and his wife, 39-year-old Zulema Trevino, for purchasing, training, breeding, and racing American quarter horses in the United States.
Testimony also revealed a shell game by the defendants involving straw purchasers and transactions worth millions of dollars in New Mexico, Oklahoma, California, and Texas to disguise the source drug money and make the proceeds from the sale of quarter horses or their race winnings appear legitimate. Furthermore, the defendants implemented a scheme to structure cash deposits in amounts under $10,000 in order to circumvent mandatory bank reporting requirements.
“Today’s sentencing marks the successful culmination to a complex, intensive investigation where the FBI, working together with U.S. Attorney’s Office and our law enforcement partners, has demonstrated the ability to dismantle the financial arm of a violent and ruthless drug cartel which has attempted to influence and control legitimate U.S. enterprises and threatened the safety of our community,” stated FBI Special Agent in Charge Armando Fernandez.
Drug Enforcement Administration Special Agent in Charge Javier F. Peña stated, “DEA is satisfied with today’s sentencings. Each sentence handed out today represents the relentless hard work and unyielding dedication DEA and its counterparts utilized to bring the defendants to justice.”
More than 400 quarter horses (which were seized by federal authorities in June 2012 as part of the above-mentioned money laundering operation) have been sold for approximately $9 million. Most of the horses were sold at Heritage Place Auction Facility in Oklahoma City, Oklahoma, in the past year including A Dash of Sweet Heat, which sold for $1 million. Approximately 100 broodmares were sold prior to auction for approximately $35,000. The federal government still retains possession of five quarter horses, including Tempting Dash, winner of the Dash for Cash at Lone Star Park race track in Grand Prairie, Texas, on October 24, 2009; Mr. Piloto, $1 million All American Futurity winner at Ruidoso Downs on Labor Day 2010; Dashin Follies; Separate Fire; Y516, a yearling seized in Lexington, OK; and four embryos transferred from donor mares Dashin Follies and Separate Fire.
U.S. Attorney Pitman noted that the proceeds from the sale of these quarter horses are being held in escrow pending the resolution of a forfeiture action. The government also seeks the forfeiture of real property in Lexington, Oklahoma; farm and ranch equipment located at that site; and funds contained in multiple bank accounts allegedly used in the defendants’ scheme. The government also seeks a monetary judgment in the amount of $60 million, representing property involved in and derived from the conspiracy.
“Today’s sentencing of top leaders of the Los Zetas crime syndicate is a decisive blow against its drug trafficking and money laundering network. It also sends a clear message to those who attempt to hide their ill-gotten gains through investment in legitimate businesses,” said Richard Weber, Chief, IRS-Criminal Investigation. “All financial transactions leave a trail and we have the unique expertise to follow those leads. The special agents of IRS-Criminal Investigation are committed to taking the profit away from drug traffickers and putting those individuals in jail. IRS-Criminal Investigation was proud to provide this financial expertise as we worked alongside our law enforcement partners and bring these brutal criminals to justice.”
Authorities continue to seek the apprehension of seven co-defendants in this case, including purported leaders of the Los Zetas, Miguel Trevino Morales (aka “40”), and his brother, 39-year-old Oscar Trevino Morales (aka “42”), as well as 32– year-old Victor Manuel Lopez, 41-year-old Sergio Guerrero Rincon, 41-year-old Luis Gerardo Aguirre, Erick Jovan Lozano Diaz, and Gerardo Garza Quintero. Co-defendants Zulema Trevino; Jose Trevino Morales’ daughter Alexandra Garcia Trevino, age 22, of Oceanside, California; 33-year-old horse trainer Adan Farias of Norco, California; 27-year-old Carlos Miguel Nayen Borbolla of Santa Anna, California; 29–year-old Felipe Alejandro Quintero of Los Alamitos, California; Eusevio Maldonado Huitron, a 50-year-old horse trainer residing in Austin; and 21-year-old Raul Ramirez of El Paso, Texas, are scheduled to be sentenced tomorrow beginning at 9:00 a.m. before Judge Sparks in Austin.
This investigation was conducted by agents with the Federal Bureau of Investigation, Internal Revenue Service-Criminal Investigation, and the Drug Enforcement Administration, with assistance from the United States Marshals Service, Immigration and Customs Enforcement Homeland Security Investigations (ICE-HSI) and U.S. Customs and Border Patrol, as well as local law enforcement agents in Irving, Lorena, Bruceville-Eddy, Fort Worth, and Laredo, Texas. The investigation received assistance from the Texas Army National Guard, Cleveland County (Oklahoma) Sheriff’s Office, and the Oklahoma and New Mexico Racing Commissions. The U.S. Attorney’s Office for the Eastern District of Texas prosecuted several members of the Los Zetas drug cartel on drug trafficking charges related to this conspiracy and provided substantial assistance to this investigation. The U.S. Department of Treasury’s Office of Foreign Assets Control (OFAC) provided assistance with the forfeiture action in this case.