Latest / Deadly Intentions / The Modern Cartels: Sinaloa, Los Zetas & Mexico’s Fragmented Drug Trade

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The Modern Cartels: Sinaloa, Los Zetas & Mexico’s Fragmented Drug Trade · Deadly Intentions

0:00
So it turns out that Sinaloa had secretly constructed a tunnel in
0:05
Tijuana and were smuggling loads like seven 27737 big planes,
0:10
uniformed military, Mexican personnel, unloading the planes,
0:14
guarding the planes, and then transporting it to the border.
0:17
That's why you got 450 organizations.
0:21
We're currently up to maybe 12 to 13 cartels, depending on how
0:24
you're going to OK the largest 2.
0:29
In 2024, the Sinaloa cartel imploded with respect to that
0:34
network. As of 2024, prior to the
0:36
implosion, you had the two large cartels in Mexico, which were
0:42
Sinaloa and Jalisco. The schematic as of 2024 or the
0:46
Sinaloa Cartel network. It's that big. 44 separate
0:49
organizations. Every one of these is a separate
0:51
organization. That's 44 kingpins.
0:53
So is every one of those, for lack of a better term, and don't
0:55
and and don't and and don't get mad at me for my stupidity, but
0:59
is every one of those 44 in El Chapo?
1:02
Yes, every one of them has their own kingpin.
1:04
Yeah, so this is 44 El Chapo, what we thought was just one
1:07
dude slinging it. It's 44.
1:09
Yes, and this is as of 2420 years ago when it was at least
1:13
twice this size. This is a fraction of what it
1:14
was at its peak. Back then you had, you know,
1:19
well over 6070 organizations. Today the largest cartel is
1:23
Jalisco New Generation. Well, Jalisco New Generation 20
1:26
years ago was 1 faction of the predecessor Sinaloa group,
1:30
another cartel called the cartel out of the Northeast.
1:32
That was 1 faction, like 3 of the main cartels.
1:35
Today we're all part of the larger Sinaloa network 20 years.
1:37
Ago So let me ask you a question, Pete.
1:39
Can we stop 44 El Chapo's? I don't know that we can.
1:44
Well, you have to target the two important elements if you're
1:50
looking to disrupt the actual drug flow.
1:53
The narcos are the least important.
1:56
You have to target the protection networks within the
1:59
government in Mexico, and you have to target the financial
2:02
networks. The narcos are the disposable
2:05
elements. Those are interchangeable if
2:08
Chapo gets busted his his cousins take.
2:11
Over we I we can give you a litany from 1989 to 25 of every
2:15
kingpin that got taken down of significance, and every time the
2:19
US government celebrated as a massive strike in the war on
2:22
drugs and absolutely no disruption whatsoever.
2:25
Here's a current map of it. Well, how were we able to take
2:28
the Sinaloa out? They took it out themselves.
2:31
They went the civil war. So like the two years ago, the
2:35
red was Sinaloa. Yeah, big, huge, all of it.
2:38
Today, Sinaloa no longer exists. You have the Zambada faction
2:42
controlling this area, which was previously Sinaloa, the Guzman
2:46
faction controlling this area which was previously seen.
2:48
These are now at war with each other.
2:50
Sonora no longer part of it, Northeast no longer part of the
2:53
all these were previously Sinaloa.
2:56
It's all been fractured now. Their point of that I'm trying
2:58
to make here is with respect to this 71 organization network.
3:02
As of two years ago, this represents the two largest
3:06
structures in Mexico. And that was two years ago, in
3:09
2024. And these are the ones with the
3:11
multiple hubs in the United States.
3:12
So I know we're going to probably get to there.
3:15
How do we go from that down to where we are today?
3:18
And that's probably what our story is about somewhat.
3:20
Yes, but the point I'm making is 71 organizations represent the
3:24
two large networks in Mexico that year there was over 450
3:30
organizations. Oh man.
3:33
The two large cartels represent only 20% of the organizations in
3:38
Mexico. Those are the two big ones.
3:40
The overwhelming majority of organizations operating outside
3:43
of the operate outside of the cartel structure, overwhelming
3:46
majority of the labs you see or they're producing and I'm going
3:50
to say at one time and then we're going to just call it
3:51
fenny. But fentanyl, we have to be
3:54
careful because YouTube will strike the but so the Fenny
3:57
labs, the majority of them aren't cartel operations at all.
4:02
You see the bus where they happen to be like out in the
4:04
middle of the some like jungle type area where it looks kind of
4:08
dilapidated like 3 Mexicans with some buckets and a cartel
4:11
operation that's just independent contractors produce
4:14
the product and whatever they produce, they'll sell to the
4:16
representative for whatever cartel controls that territory.
4:19
So the cartel is like the central clearing house.
4:21
All you independent contractors produce however much you want.
4:24
Don't take everything off your hands.
4:25
Make all you want, but bring it to like.
4:27
Almost like when you would be a farmer and you bring your crop.
4:30
The cartel Rep for that area who be the Plaza boss, He's
4:34
responsible for operating the market.
4:36
And do they have like a we'll buy all you can make everything
4:39
like you make it. We'll, we'll buy.
4:41
It. That's right.
4:42
So that's the lowest Level 3 Mexicans in a bucket are taking
4:45
it to one of the two main. Well, whichever group controls
4:49
that territory, because see, remember, we think in terms of
4:51
cartels, they don't see it that way at all.
4:54
There's an organization that, look, the country of Mexico is
5:00
broken up into different geographical regions.
5:02
And within each geographical region you're going to have a
5:05
different nominally A cartel. What that cartel consists of the
5:10
44 organization network. And so the point is, is that the
5:16
the ability to disrupt the production is very limited
5:23
simply because you have so many independent contractors today.
5:27
And so if if you're advocating on behalf of the American
5:31
government saying we're going to disrupt the drug flow, then you
5:34
have to identify the single points of failure.
5:39
So you target the protection market because Pedro can operate
5:44
in this 75 mile area because the general, the chief of police and
5:47
the chief prosecutor are all making sure that he has
5:50
protection and take out his adversaries.
5:53
Right, not only has Pedro got protection, but he also got an
5:57
insurance policy if Juan down the road starts trying to do
6:00
what he's doing, that's. Essentially the entire.
6:03
Yeah, that's. The that's the architecture, how
6:05
things work in the mid 1980s. Just a quick little recap.
6:08
We had the previous predecessor group called the Guadalajara
6:11
network referred to informally as the Pacific Cartel, but
6:16
they're on the Pacific Ocean. You had a separate group in
6:20
Mexican state of Tamaulipas, which was the Gulf Cartel.
6:23
Those were essentially the two cartels in the mid 80's.
6:27
The most significant unaliving which took place within the
6:30
context of the Mexican drug trade was the mid 1980s
6:33
unaliving of the DEA agent Camarena.
6:37
That's when all shit broke. Well.
6:39
That's right. Yeah, because at the time.
6:41
Because they had kind of an honor amongst men deal with the
6:44
US government that the you don't kill AUS agent.
6:50
That wasn't even contemplated at that point.
6:52
This is the rule took effect subsequent to this event.
6:55
OK. At that point, the Mexican
6:57
government was undisputably in control of the drug trade
7:02
because you had the political party pre PRI, which at that
7:05
point had been in control for five decades.
7:08
And they had a intelligence and federal law enforcement group
7:12
called DFS. And that was there like FBICIA
7:15
combo. Well, DFS was just massive
7:19
corruption. And so the individuals that
7:20
snatched up the DEA agent, the undercover agent, were actually
7:24
federal law enforcement in Mexico.
7:26
They brought him to the cartels branch.
7:28
Were they given orders to? They ran the trade.
7:32
Nobody's giving the federal government.
7:34
Orders. So the federales.
7:36
Were pissed off because the drug Lord who controlled this massive
7:40
production of marijuana cultivation, an individual named
7:43
Caro Quintero or Caro Quintero's operation, was disrupted because
7:47
of the successful infiltration of this undercover DEA agent.
7:52
And so the people who took a huge hit were not just the
7:55
narcos. But remember, 50% of all their
7:57
profits went to the Mexican government.
7:59
That's off the top. So the Mexican government, it's
8:03
incentivized to. So the DFS, yeah, so they were,
8:06
you know, they they vastly overplayed their hand.
8:10
Did did some shit like did some some bot did some heads roll?
8:14
Because, well, subsequent to this, you had two events.
8:17
One, the Mexican government made a show of disbanding the DFS.
8:22
It's essentially it's renaming the Department of Defense to the
8:26
Department of War. The same fucking thing.
8:28
Same thing we did. But they just, they, they, they
8:30
abolished it because it was rife with corruption.
8:33
And they had a probably bad name.
8:34
Oh yeah, that point after the whole thing with the agent,
8:36
right, so. We're getting rid of these, but
8:39
really they're just reskinning it.
8:41
That's right. Yeah.
8:42
So, but so the DFS gets rebranded, but the same
8:47
arrangement remains in place and it's referred to as La Plaza.
8:50
And La Plaza in it's a system of criminal governance where the
8:54
Mexican government breaks down territories.
8:57
This is to answer your question. And so from Guadalajara, they
9:00
controlled everything from on the, from the equivalent of San
9:04
Diego to El Paso, from Tijuana all the way to Guadas.
9:10
And so the entry points for that stretch was controlled by the
9:13
Guadalajara network from just east of Juarez down to Reynosa,
9:21
which is, you know, let's say, from El Paso to Brownsville.
9:24
That was the Gulf. And so because of the size of
9:30
the Guadalajara network, it was broken down into little regional
9:33
fiefdoms. So you had one up in Juarez
9:37
that's called a Plaza. That's a geographical territory
9:40
where all criminal activity is being controlled by one
9:44
particular group. The individual gets a franchise
9:48
from the Plaza. So you had a Plaza in Tijuana,
9:51
you had a Plaza in Nogales, you had a Plaza in Juarez, you had
9:54
one in Guadalajara, you had one in Seattle on Kuljacan.
9:58
Now, the ones that were the most valuable, of course, are the
10:01
ones on the border. Kuljacan is, you know, 8-9
10:07
hundred miles to the border. It's a, you know, it's 1000
10:09
miles to Los Angeles. So after the unaliving of the
10:12
DEA guy, yes that one shit got real.
10:14
This. Shit got real because at that
10:15
point, the response by the American government was just
10:19
overwhelming wrath. Just yeah, there's like, that's
10:22
a line that was not acceptable. Almost like you done fucked up.
10:27
Sure. Like we're we're OK.
10:28
And so the Mexican government had to go through this charade,
10:31
on the one hand of rebranding the DFS.
10:36
Kind of put them in a, OK, they fucked up, we're going to get
10:40
rid of the agency, We're going to start new when really they're
10:43
just yeah, yeah, they rebrand. A few sacrificial heads.
10:46
OK, you, you take stress, disability, retirement.
10:48
So did they? Did they actually ever find the
10:51
actual person that underlined? They focused on the the narcos.
10:56
The group. Yeah, And so like the individual
10:58
that was responsible, who, you know, look, the guy was very
11:01
unreasonable, Caro Guntero. And but, you know, this
11:06
Guadalajara network was put together by the federal
11:08
government of Mexico. That's what people have to
11:10
appreciate. Like they wanted to be able to
11:12
tax the drug trade. But in order for you to be able
11:14
to tax the drug trade, you have to centralized it.
11:16
You can't have hundreds of guys running independent.
11:19
You need a market to be able to impose your tax.
11:21
And so they said we're going to take you the you guys out of
11:23
Sinaloa, put you in Guadalajara and create the market.
11:27
Meanwhile, they also created the corresponding money laundering
11:30
network. Like Guadalajara serves as the
11:33
capital for money laundering with respect to drug proceeds.
11:38
There's, you know, other hubs for money laundering with
11:40
respect to, you know, selling oil or blood diamonds and that
11:44
kind of crap. But for drug trade,
11:47
unquestionably, Guadalajara is the capital for money laundering
11:50
that's created by the Mexican government.
11:51
So they created the financial hub and the trafficking hub.
11:56
They got both sides cleared. And so now, yeah, because they
11:59
had to figure out one, you had to be able to tax the Darkos,
12:01
and then you had to be able to transfer the money from the
12:03
narcos to the political class. They're not taking duffel bags
12:06
of cash. Or you had to clean it?
12:08
So that's why you have the financial networks.
12:10
Well, those financial networks have never been disrupted for 50
12:12
years. That one will never fall.
12:14
You can that the financial, the financial instrument of the
12:17
cartel will never fall. It's not of the cartel, it's of
12:20
the political class. Sorry, the financial end of the
12:23
political class that is in on the the the the clip will never.
12:30
It's government funded. It'll never stop.
12:31
Well, yet because it, it's not in the interest of the Mexican
12:36
government to disrupt the ability of The Dirty money to
12:39
get to the political parties. Like today, the situation is a
12:41
little different. But back in the 1980s, it was
12:43
one political party. They took 50% off the top.
12:46
They controlled federal, state, local authorities.
12:50
And so the 50% went to the feds and then the narcos had to take
12:53
care of the state and the locals on their diet.
12:56
Like by the time the money, like you know, by the time the, the,
12:59
the monthly breakdown if and the leader of the Guadalajara group
13:03
is police Guyardo if they said he made $100 million that month,
13:07
he maybe made 3 or 4. Out of 100.
13:09
Yeah, because he had a spatter. After he went to pay for you
13:12
got. To pay for the product.
13:13
We got 50% off the top. Fed for the Fed, then you got to
13:16
pay for the local authorities, you got to pay for the state
13:18
authorities, then you got to pay for the product.
13:20
Then you got to pay for the transporters, the workers.
13:23
Yeah. This notion that he was the
13:24
first Mexican billionaire is absurd.
13:26
That has to leave to a ton of political corruption in in in
13:30
Mexico with regards to the president on down as to how how
13:34
they're regulating it, who they're dealing with and how do
13:37
they get it. I mean, how do they get their
13:39
cut through the laundering portion?
13:41
Through the laundering portion, yes and so in the aftermath of
13:44
the other live in the DEA agent tremendous amount of pressure
13:47
from the American government. So now the Mexican government
13:50
says OK look give him a couple sacrificial lamb.
13:53
So they go and they arrest Caro Quintero.
13:56
They arrest for sake, another one of the main guys in the
13:59
Guadalajara network. But they don't extradite them.
14:02
They can't send them to the United States because what if
14:04
they talk? We're going to say, what are you
14:06
talking about? So the bad guys in Mexico that
14:08
we want to blame the DEA shooting on, we can't really
14:12
yoke them up and take them to America or the Mexican
14:15
government can't have them come to America because they're going
14:17
to say, hey, the government's in on the deal, man, like.
14:22
Later on, there's a huge scandal.
14:24
Here. This is so scandalous.
14:25
There's a huge scandal, scandal in the 1990s because the Mexican
14:28
president, a guy named Salinas, it was discovered that his
14:31
brother has Swiss bank accounts with hundreds of millions of
14:33
dollars in it. What was the Mexican president's
14:35
cup from the drug trade? Well, you can't have the guys
14:41
that are. Now can that that Mexican
14:44
president who had hundreds of 1,000,000 via whoever in an
14:48
offshore account can after his term, if he didn't get killed,
14:53
does he have access to that? I mean, is it his?
14:56
Well, it's the brother, wasn't the money was nominally his
14:59
brothers. Right, correct.
15:00
And so they're they're going to who's investigating the Mexican
15:06
government? Right, 'cause the new guy that's
15:08
in there is probably doing the same.
15:09
Thing every one of the parties. Now, has there ever been, Pete,
15:12
this would probably be a question.
15:14
Has there ever been a head of a political party that was in
15:17
charge of Mexico, the president or whatever?
15:20
Has there ever been one that wasn't in on the take?
15:24
Well, there's A and on the take. It implies the personal
15:29
involvement of the president, like so, for instance, today
15:32
Miss Scheinbaum, there's no indication that she is
15:36
personally receiving any money. Personally.
15:39
Personally. About the government.
15:41
Her party, however, the Modena political party, has within its
15:45
political faction numerous drug organizations that help provide
15:49
funding. In fact, it's a big you know,
15:51
the American government was targeting the previous
15:54
president, an individual who went by the acronym AMLO, or
15:58
almost the same political party. Well, the American government
16:01
has already publicly accused Morena of being financed in part
16:06
by drug organizations from Amlo's campaigns.
16:09
Or every one of the political parties in Mexico receives
16:15
monetary support in the form of structured payments from the
16:18
organizations within their factions.
16:21
Now, how many like, you know, here in here in America, we have
16:23
two Republican Democrats. You know, that's, I mean, I
16:26
guess you could have independence and what have you.
16:28
But the, the, the two, the two that run the show, the two that
16:31
are going to put a president in the White House, the
16:33
Republicans, the Democrats, how many do they have in, in, in
16:36
Mexico? It's at least three who've had
16:39
presidents in three. Who's had players in the?
16:42
Game in the last 25 years, OK. Those are they're still yeah,
16:45
their terms are 6 year presidential terms.
16:48
OK Significant amounts of drug proceeds help fund her campaign,
16:52
which is why they're all vulnerable.
16:53
Like it would be shocking if someone associated with either
16:58
the two big parties in the United States was providing
17:00
political protection for drug organizations.
17:02
It'd be a major scandal in the US right down there.
17:04
That's a question, of course. But so let so you you said if it
17:09
was happening within the Republican or Democratic.
17:11
Party I can't imagine a. Huge deal, but do you think
17:14
there's a chance it could be? At the federal level, no.
17:18
In Mexico. It's way of life.
17:21
Well, yeah, Well, remember it, the out in the 80s, you had one
17:24
party, you had the DFS, 50% off the top unaliving of the DEA
17:29
agent, tremendous pressure from the American government.
17:32
They give up a couple sacrificial guys.
17:34
They arrest two of the drug Lords, put them in jail, refuse
17:37
to extradite them. And so then the American
17:39
government, of course, they back off a little bit, but they keep
17:42
the pressure on. They actually use this.
17:46
The unaliving of the DEA guy. The DEA agent, they leverage
17:50
that to facilitate the negotiations for NAFTA.
17:54
The Free Trade Act. And so the American government
17:57
has a practice of using the threat of drug trade
18:01
prosecutions to extract concessions in other aspects of
18:07
the relationship between the US and Mexico.
18:09
And because all of the political class in Mexico are vulnerable,
18:13
the US can push that button. Like right now, the Trump
18:15
administration is very effectively using the threat of
18:19
prosecuting what in a political party officials, because they
18:22
know they're all dirty. It's like they've they they
18:24
indicted the Sinaloa governor. They've indicted a couple of
18:26
governors. They're targeting high-ranking
18:28
officials, but it's sure they've yes.
18:31
Does our military or whoever we would send to go get a bad guy
18:36
in Mexico? Do we have the juristic?
18:39
I mean, we can't do that legally, can we?
18:41
If, if the city, I'm sorry if the if the country of Mexico
18:45
says no, I know you want Johnny bad guy here, but we're not,
18:49
we're not extraditing him. They, the Americans, don't have
18:51
the power to go in and get him, do they?
18:54
Legally, no. In the aftermath of the whole
18:58
unaliveness of the DEA agent, you had a couple of big narcos
19:03
were sacrificed, but the US government had identified what
19:06
do they There's probably several dozen men who served significant
19:11
prison sentences in the United States who had nothing to do
19:16
with his unaliving. Like if you're part of a drug
19:19
conspiracy and somebody gets unalived, everybody in that
19:21
conspiracy is legally accountable.
19:24
So they'll go grab whoever they can.
19:25
You've got guys that were 1000 miles away when this happened,
19:28
like they had no. Idea no.
19:29
When we went and got those guys that we have to drop in like
19:32
special bounty hunters, like some special OPS kind of deal.
19:35
Just American bounty hunters. So in American Bounty Hunters,
19:38
just some badass dude that knows where this other dude is.
19:41
I had a friend who was There's a State Department program where
19:44
today would they pay for. You know, the US has a a
19:49
doctrine where the manner in which a foreign national arrives
19:53
in the United States for the purposes of prosecution is not
19:56
relevant to the court's jurisdiction to hear the case.
20:02
So you can legally snatch up someone, kidnap them, bring them
20:05
to the US, hand them to recently happened a couple years ago with
20:11
Zambada. Another narco in Mexico
20:14
kidnapped the guy that was the most significant narco within
20:16
the Sinaloa network. This is what led to the civil
20:18
war. They snatched him up, brought
20:20
him to the US, handed him off to the feds.
20:23
Well from the feds perspective, we took possession of him at the
20:26
airport. How he gets here is irrelevant.
20:29
Bounty hunters going to Mexico. Like what type of bounty?
20:32
At the time or this is 1980, so you know half $1,000,000 was a
20:36
lot of money back in the mid. 80s but it would be like
20:38
something like that. Today to 15,000,000, 2020,
20:40
20,000,025 million. In the 80s they they had five,
20:42
they had 500,000. Dollar bonds.
20:44
They had bounties significantly. And that was bring the guy back
20:46
to America. They bring him to the border and
20:50
just so coincidentally, Marshalls happened to be right
20:52
there or customs happened to be right there and they just like
20:55
cut a hole in the fence and throw them through and they're
20:58
like, aha, you're here. And then once the bounty guy is
21:02
back on American soil, now he didn't have to worry about or
21:04
would it? Would it be often?
21:05
Well, he can't, he can't go back to Mexico.
21:07
Well, they would coordinate. You had things are so shady in
21:11
Mexico. And so you could have, if the
21:14
bounty are sufficient enough, then you're going to have the
21:16
authority to say, you know what, maybe we can hand over Juan
21:18
Carlos for the mid 80s. It was a little bit different in
21:20
that you had this tremendous amount of pressure from the US
21:23
government, including bounty hunters, which gave rise to the
21:27
1987 Acapulco Conference. Which is where we are now.
21:29
Because the pressure, they wanted the head guy, the
21:33
individual named Felice Gallardo.
21:34
And he was the one designated by the DEFDFS to be the leader of
21:38
the Guadalajara network. He's former law enforcement,
21:43
more sophisticated. He wasn't your functionally
21:47
illiterate, you know, Paisa from the mountains of Sinaloa, the
21:51
guy who had some level of sophistication.
21:54
And so he was the guy, the point man in charge.
21:57
But U.S. government U.S. government is demanding fleece
21:59
Guyardo. Now, now, now, Pete, I don't
22:01
know if we've talked about this, but why?
22:03
Why did they kill the DEA guy? Was he was he getting too close
22:07
in? No.
22:07
They took down he was a successful operation.
22:09
They took down what was A at the time.
22:12
So he embedded himself into. Him and his informant were able
22:15
to infiltrate the operation Security information and result
22:20
in taking down this massive grow operation.
22:24
You know, it may have actually been like somewhere approaching
22:27
a billion dollars, at least hundreds of 1,000,000, but I
22:30
think I remember it was like a billion something.
22:32
It was in mid 1980s numbers. I mean, this is enormous.
22:35
So this undercover DEA guy, he, he kicked, he kicked ass, kicked
22:39
ass and, you know, did his mission, you know, huge, huge
22:43
volumes of a. Major takedown.
22:46
Now, did he ever make it out of Mexico?
22:48
Or snatched him right up in Guadalajara.
22:51
So how do they I mean, I guess, I guess they figured out who
22:54
the. Guy the federal authorities,
22:56
they know who's in you know they were like who look, the DEA
23:00
agent didn't announce himself as DEA.
23:02
So they're thinking he's an American narco, which is why
23:06
subsequent to the mid 80s you don't see undercover operations
23:09
in Mexico anymore. There was all this huge American
23:12
law enforcement presence in Mexico, but that's intelligence
23:15
gathering. It's not.
23:17
That's why they, if you're an American citizen, you have to go
23:21
to Mexico to deal with them because they won't deal with you
23:24
on American soil. But you white guy from Tampa,
23:29
you go to Mexico, they'll deal with you no problem because they
23:31
know you're not DEA. So that'll be cool with me,
23:33
yeah. Of course, they have no problem
23:34
dealing with gringo's on on Mexican soil.
23:36
And then I'd I'd set up some type of.
23:38
Distribution like carrying Fort Myers, one of the individuals
23:42
who was supposed to be one of the largest traffickers in South
23:44
Florida history. He travelled to California, go
23:47
to San Diego, meet with the guys from Tijuana.
23:50
This is after Sinaloa taking over that Plaza and they'd make
23:53
an arrangement and then he'd take delivery.
23:56
He set up a business where they were importing like cement
24:03
related products like much, much of the cement industry is
24:06
actually based in Mexico. And so if you've got like a
24:08
major construction project. You're going to like like like
24:11
blocks and. Contracts of whatever the
24:13
whatever the IT was a cement related operation beam and so
24:16
they're they're bringing in multiple ton loads and they were
24:19
shipping it to the port in Tampa.
24:21
From the cartel perspective, they just loaded onto the boats
24:25
in Mexico. Everything from that point
24:27
forward is Kerry. So Kerry's got to have that
24:30
contact at Port Tampa. He's ever contacted.
24:32
They're just smuggling the product concealed within the
24:35
loads. He's taking the delivery of the
24:38
cement stuff, yes Sir, in Port Tampa to get shipped down to
24:41
Fort Myers, His cement stuff. His cement stuff, yes.
24:44
And so from his from the cartels perspective, here's an American
24:47
buying the product in Mexico and he says put it on that
24:50
container, they're done at Mexico.
24:54
From this point forward, everything was carried.
24:55
Now how does Kerry pay pay them back in Mexico?
24:59
That'll take the money to San Diego.
25:01
Physically. Physically.
25:03
Dollar bills, yeah. Of course.
25:05
And then? And then, well, they'd have a
25:09
Mexican operative meet Kerry in San Diego to take possession of
25:12
the cash because they know he's not a cop because he's already
25:14
been in Mexico buying the load. He's just completing the
25:16
transaction by dropping off the money.
25:19
So they know he's not a cop. Yeah.
25:20
So like, they didn't deal with him on American soil.
25:24
They dealt with him in Mexico. Now they're just collecting the
25:26
money. And so he would have to travel
25:28
to San Diego, drop off the money and then, you know, come back to
25:32
South Florida, wait for the next load.
25:34
So let's start with the 87. OK, so yeah, so because of the
25:37
pressure being put on Felice Gallardo, who at the time was in
25:40
charge of the Guadalajara network, he said, look, the
25:45
gringos are going crazy. We need to protect the overall
25:51
operation by defusing power. And so each of those regional
25:57
outposts, the one in Sonata, the one in Juarez, the one in
26:01
Tijuana, each of those individual plazas, you guys are
26:03
going to run yourselves. Especially what the Iranian
26:08
government did with when they broke up the country into
26:10
military zones. Well, that's what Sinaloa did.
26:13
They broke it up into different, or that's what Guadalajara did.
26:15
They broke it up into different regions.
26:17
And so for the next two years you had these ranges operating
26:21
autonomously, but they still had to report back to Guadalajara
26:25
because the government's got to get their 50%.
26:27
Government's always got to get their clip.
26:29
And so this was a defensive mechanism put in place by the
26:34
narcos to ensure the integrity of the overall operation because
26:39
of the pressure coming from the American government following
26:41
the unalliving of the DEA agent. Now, the second significant
26:45
event that came out of that conference in 87 were the rules.
26:48
From here on out, no American law enforcement are allowed to
26:52
be harmed. Period.
26:54
And if you do, you're. You're gone.
26:56
You get decapitated. You and your whole family do
26:58
not. Hold on, that's the way Mexico
26:59
rolls not only you, but your. Whole family doom because the
27:03
pressure from the American government.
27:04
That was the red line. Like up until then, there was a
27:07
cat and mouse game. Everybody's playing their game
27:10
once you harm a federal agent. And you had the wrath of the US.
27:14
Government, yeah, they, they learned the the lesson the
27:17
Japanese did after Pearl Harbor, like don't awake, awaken the
27:22
slumbering giant, essentially. And so that rule was put in
27:25
place. The second one, of course, is
27:27
don't harm American civilians, which for the most part is
27:29
respected. But the law enforcement one,
27:32
that was red line. That's a no, that's a, that's a
27:36
non starter. No deal.
27:38
Yes. And so following that 87
27:43
conference, you know, had for the next couple of years, all of
27:48
the plazas operating autonomously with the Mexican
27:51
government getting their 50% off the top in 1989 because of the
27:55
pressure continuous. This is like 4 years later, the
27:58
government's still scratched, they want Feliz Gallardo.
28:01
Well, the Mexican government can't give Feliz Gallardo
28:03
because he knows the whole layout.
28:04
He knows the senators that are getting paid, he knows the
28:07
generals, he knows the president.
28:10
So they say, OK, well, we're going to arrest him.
28:12
So they arrest Feliz Gallardo, put him in a sweet jail.
28:15
He still hasn't been released. He still hasn't been brought to
28:18
the United States 40 years later.
28:19
Is he still in? Jail.
28:20
Yeah, of course. For real.
28:22
Yeah. But he was just on Spanish
28:25
language news not too long ago where they had an interview with
28:28
him. And he's like, look, I had
28:30
nothing to do with the agent getting on alive.
28:31
Yeah, I ran the narco operation. But this is like, I'm over here.
28:35
This, you know, this happened 300.
28:37
Like, he's like, you know, the the way the American
28:40
government's interpretation of conspiracy law, it allows for
28:47
holding people legally accountable for conduct they
28:50
didn't personally participate in.
28:52
Almost like a racketeering kind. Of yeah, it's, it's, it's, it's,
28:55
it's vicarious liability or it's a spirit of liability.
28:58
Real open umbrella for them to get a dragnet to everybody.
29:01
Even everybody, because he was such an important figure within
29:06
that Guadalajara network. The Mexican government arrest
29:09
the man, but they protect them by not sending them to the
29:11
United States. Well, once Felice Gallardo was
29:14
taken out of the picture, those five plazas went full
29:22
operational by themselves. Now you had essentially the
29:24
breakup of mob bell into the Baby bells.
29:27
This is the Guadalajara network. This articulated and that gave
29:30
birth to the modern cartel era. This happened in 1989 and it
29:36
exploded. So now you had five cartels
29:39
before you had the 2 cartels, one in Guadalajara, one being
29:44
ran out of Matamoros where they were the central authority.
29:51
Well, with five groups operating independently, you got a half a
29:54
dozen in total, but 5 on the Pacific side.
29:57
Well, that introduces competition because once you
30:02
introduce competition, now they're trying to increase their
30:06
position relative to their competitors.
30:09
And how do you do that? Well, in Mexico you can either
30:12
UN alive, your adverse, your competitors, which at the time
30:15
that wasn't the norm. That was the last result, not
30:21
the first. Once you had the five cartels
30:24
operating on the Pacific side, now you had jockeying for
30:28
position. And so when the plazas were
30:33
being split up amongst the groups at the 87 Conference, the
30:39
city of Tijuana, that Plaza was given to the Arianos, which were
30:43
the nephews of Feliz Callardo. A lot of nepotism going on down
30:46
there. Also, you had the group in
30:48
Sonora, which was Caro Quintero's family.
30:51
Then you had the group in Juarez, which was ultimately
30:54
taken over by a drug Lord named Amaro Carrillo.
30:56
You had the group in Sinaloa who the individual responsible for
31:01
that was Chapa Guzman, because Chapa Guzman's uncle was
31:05
Fonseca. And so when they were divvying
31:09
up the ports of entry, you had Tijuana, got the crown jewel
31:14
Tijuana right into San Diego, 3040 miles outside of Tijuana.
31:19
You had a border crossing for Tecate.
31:20
Well, that's the one Guzman received.
31:23
Tecate. Tecate little small rat ass port
31:26
of entry like Sinaloa has always been the redheaded stepchild.
31:30
So they had the least favorable position geographically because
31:32
they're nowhere near the border. In 1989, that structure goes
31:35
away. Each each of the autonomous
31:37
units now become their own independent, what we call.
31:39
So in 89 they agreed to that, but in 89 then we're going to go
31:43
on that. Structure goes away because they
31:44
arrested Feliz Callardo and now the five Organization 5 networks
31:48
are now what we refer to today as the standalone cartels.
31:51
Today's we moved up to 12 to 13, but back then you had five on
31:54
the Pacific side and one on the Gulf side.
31:57
We had a half a dozen cartel. So when we take out these
31:59
leaders, it just breeds more and new leaders.
32:03
It's the law of unintended consequences because when you
32:07
take out the leadership, it fragments.
32:10
And when you fragment, now you've got five groups operating
32:14
independently. So when you've got one guy in
32:17
charge, they're going to try to regulate the amount of product
32:20
that comes to the US so they can minimize the product to maximize
32:23
profits. That's what capitalism is.
32:25
It's a monopoly. So now, because Tijuana's
32:28
favorable position throughout the 1990s, this was the largest
32:31
network in Mexico, they're doing 20 tons a month.
32:33
Sinaloa was doing 789. The Tijuana was nearly twice the
32:39
over 2 to 2 1/2 times the size of Sinaloa.
32:43
On the Gulf side, same thing. The Gulf cartel was enormous
32:45
going into the 1990s. Throughout the 1990s, they're
32:48
doing 20 tons a month. Well, they dwarfed Sinaloa.
32:53
Well, the reason why they were able to do that was because
32:56
Tijuana and the Gulf were able to maintain those ties with the
33:02
ruling political class. So you had the pre political
33:06
party officials had an incentive to make sure that these two
33:09
groups succeeded? So within the political
33:13
structure of Mexico, there's a lot of shady shit that goes down
33:17
with regards to aligning yourself with the right party
33:20
that so that you can potentially have protection 'cause if you
33:25
get aligned with the wrong party.
33:27
Then you don't have protection. Then you don't have protection
33:29
and you're. The target of the groups who do
33:31
have the protection. You're the target of the guys
33:33
that you didn't align yourself with.
33:35
If, if they win like so, I gotta think that these drug cartels
33:38
are huge contributors to the political, the to the political.
33:42
At the time, in the 1990s, there was still only one political
33:44
party who ruled modern Mexico for five decades, 6 decades at
33:47
that point, but they're getting the 50% off the top.
33:50
They didn't have any competition.
33:51
They had no competition politically.
33:53
So politically they Mexico didn't get competition till what
33:56
the 70s 2002? So they went, cleared up 2000
34:00
with A1. Basically a one party system.
34:01
One party system from which? Was easy for the cartel 'cause
34:04
they only had degrees one one party, no.
34:06
It's the other way around. The government wanted one
34:08
cartel. It's not the cartels driving,
34:11
it's the Mexican government saying what's the most optimal
34:14
manner that we can extract the most amount of money from the
34:17
drug trade without getting our hands dirty.
34:19
And that's where you start handing up.
34:21
Look at Chapo, he's a bad guy. So whose idea was it to start
34:24
another political party? Well there's always been
34:26
multiple political party but they had a control of the
34:32
political apparatus now. So going throughout the 1990's,
34:36
the two main cartels in Mexico, Tijuana and the Gulf were the
34:40
ones that had the deepest ties with the party in power pre and
34:45
a successor to the DFS. So now here's Sinaloa, 900 miles
34:52
to the border with this little rat ass Tecate port of entry.
34:58
So in 1991, and keep in mind, and you know, I'm from Los
35:03
Angeles, so my familiarity with the drug trade in Mexico is
35:06
primarily centered around Sinaloa because Sinaloa operates
35:09
out of LA, That's their primary base of operations in the United
35:11
States. And so they found themselves in
35:15
a circumstance where in order for them to bring their loads,
35:18
they either had to take a much higher risk by going through
35:21
Tecate, which is a lot fewer traffic, or running
35:26
clandestinely through Tijuana. Now the Tijuana guys were in the
35:32
catbird seat because they were able to, like I said, only go a
35:35
few miles to bring their loads across the border.
35:37
But they're they're the ones dealing with Pablo Escobar.
35:41
They had the contract for medicine, but Medellin worked
35:44
with Tijuana and the Gulf Sinaloa nowhere near the border.
35:48
They were working with the smaller group in Colombia.
35:50
So they had less volume, less advantageous geographically and
35:56
they had less political power. And so from the Tijuana
36:03
perspective, they're making their money smuggling product
36:05
for the Colombians, huge revenue stream.
36:08
Independent of that, they're taking their payment.
36:10
And this was the other thing that came out of the
36:12
conferencing. Instead of getting a fee, they'd
36:14
take a they'd take a cut of the product.
36:16
Yes, that's right. Third what, 1/3 at that .30 to
36:19
40%. So let's say if the Colombians
36:21
say, hey, we need to get. 20. 12 tons into the New York?
36:25
Well then they'd have to send over 16 tons.
36:28
Right, because the the the cartel had to get their cut.
36:31
They. Had to get their cut.
36:32
The Mexicans had to get their fee for the service.
36:35
Now does that kick back to the government too?
36:37
They get their 50% off the top, so they get 50%.
36:39
Doesn't matter where you're, whether you're growing it,
36:41
manufacturing it, transporting it. 50% of the gross. 50% of the
36:45
gross goes to the goes to the government.
36:47
And it has to. And they were audit and every
36:49
month you get audited. And so it was like, OK, how many
36:52
did you do that? 20 tons.
36:53
OK, no problem. Or you're charging how much?
36:56
1/3, OK. And the LA price or the San
36:59
Diego price for Tijuana. During the course of Chavo
37:01
Guzman's trial in 2019, he was prosecuted in New York.
37:06
One of the star witnesses in the government case was Miles
37:08
Ambada's brother and he recounted how after the
37:15
political campaign of 2012, the individual that won the
37:20
presidency in Mexico was a candidate for the pre political
37:24
party or named Pena Nieto. And during that period where he
37:30
was president-elect, he just won the election.
37:32
But before being sworn in, he sends word to Sinaloa, cause at
37:38
the time Sinaloa was the largest cartel in Mexico.
37:40
Well, they've been operating at a 12 year run because Sinaloa's
37:43
political party is pun not pre. So pre won it.
37:46
So pre won it and said OK you cock suckers, we know you've
37:48
been supporting these other guys.
37:50
And he's president of the Elect. He's president of the Elect.
37:52
He says look. He sends word to.
37:54
To Zambada, he's the contact. He doesn't talk to 44.
37:57
Narcos talks to 1. He talks to one.
37:59
That guy handles the other 44 and he sends word to Zambada,
38:03
says look, we know that you have a relationship with PAN.
38:06
However, you guys are the top dog.
38:08
We're professionals. We're prepared to allow you to
38:10
maintain the status quo. The same arrangement you had
38:14
with PAN, keep the same territories, everything, nothing
38:17
changes. In order for us to have that
38:20
arrangement, me and my people, we need a couple 100 million off
38:23
the top. This is before the guy takes
38:25
office. He's president-elect, he's
38:27
forming his cabinet. Like one of us to do things is
38:30
send word to Zombada we need 200 million off.
38:32
The top to set up your deal. This is just to maintain the
38:34
status quo. And so now Zombada, of course,
38:38
being a businessman, says, look, that's reasonable.
38:42
That's reasonable. We'll give you $100 million
38:44
deposit now. You're kidding me.
38:47
No. And so then the brother of
38:48
Zombada, when he testifies in Guzman's trial, he's like, yeah,
38:50
we had to pay 105 million. So then Zombada's got to go to
38:53
the 44 guys. Hey, these guys want 200 million
38:57
off the top. That's just to keep status quo.
38:58
So I need X amount of. Million You you tipping 15.
39:01
You tipping 10, You tipping 5. That'll keep the heat, keep the
39:05
heat off of us. That'll just maintain the status
39:07
quo now, that's why when you hear the the authorities here in
39:10
the United States, well, somebody was the most powerful
39:12
drug Lord in Mexico. Well, he didn't have the biggest
39:15
organization. He didn't have the biggest, he
39:18
didn't have the largest number of sicarios, hitmen.
39:20
He was just a go to guy. He was the point of contact with
39:24
the political class. Like in Mexico, the power is
39:26
defined by access to political, powerful political figures.
39:31
If you're the guy dealing with when the president sends word,
39:34
we need 200 mil and he sends word to you, everybody's
39:38
subordinate to you. Even if you're not the biggest,
39:41
the most don't you have access? You're the.
39:44
You're the. In the contact.
39:46
Yeah, you're the informant. No.
39:48
Not the I'm sorry, you are the contact.
39:50
The contact. To the largest entity that's
39:53
going to keep your your business operating status quo.
39:56
That's right. So did the president get that
39:58
money? According to Zambada's brother,
40:00
during the course of the trial of Guzman, he said yeah, we
40:03
dropped off the original 100 million.
40:05
So does them at them at that point when they're doing the
40:07
trial of Guzman, do we start looking into the president at
40:10
that point? Did he really get the money?
40:11
Or do we at that point, like, listen, we got Guzman here.
40:14
Do you think they're operating because they don't have
40:16
protection? I mean, in the United States, we
40:20
don't have. I guess we don't have
40:22
jurisdiction to go down there and fuck with them, do we?
40:25
I mean, we just went into Venezuela, but that's a whole.
40:27
That was last episode. Yeah, yeah.
40:29
But look, the incentive structure is for us to always
40:32
overlook, up until recently, the Trump administration isn't where
40:35
they broke the mold in that they're actually targeting
40:38
political figures in Mexico. Now, of course, they're it's
40:42
disingenuous. They're not targeting the for
40:44
the drug trafficking. They're trying to use it as
40:46
leverage with respect to trade concessions, but nevertheless
40:50
they are effectively utilizing this by targeting the political
40:53
class. So Trump's leaning on some
40:55
political plan. It's really not much to do with
40:57
the trade, the drug trade. It has to do more with the the
41:00
tariffs and and the. China and all that stuff, but
41:02
the manufacturing. But you can see that if they
41:05
wanted to actually do that with respect to the drug flow,
41:09
because the Trump administration has targeted the political
41:13
structure, particularly the more than a political party right
41:16
now. And they've also began targeting
41:19
some of the financial structures.
41:22
And that's what gets people nervous down in Mexico because
41:24
it's like, ho, ho, ho, that's, that's always been the, you
41:28
know, so right of place, so. The president that got a hold of
41:32
Guzman or got a hold of Guzman's guy?
41:36
Amy Zambada. Zambada that really didn't go
41:40
anywhere. I mean, they're just so adamant
41:41
about getting Guzman for whatever they got him for.
41:43
They're not really adamant about clipping the president and how
41:47
what you know, whatever pay off they they had to pay to get from
41:50
that or not you you don't hear any of.
41:52
That Guzman had nothing to do with these operation.
41:56
That's why they handed over Guzman.
41:58
They would have never handed over Zambada.
42:01
Zambada was brought here because he got kidnapped.
42:04
Now is Zambada on US toilet? Yeah, he just got a license.
42:07
He was kidnapped and brought here.
42:09
And Zambada was just the. He's the point of cuts.
42:11
That's like, if he talked, then it's going to be this president
42:15
falls, that president falls, that president falls.
42:19
In 1989, you had two significant events.
42:25
In that one, Felice Gallardo was apprehended, but the Mexican
42:28
government refused to send them over.
42:29
Felice Gallardo, the guy that was in.
42:31
Charge of the Guadalajara network so that network but he.
42:33
Also take the hit for the unaliving of the DEA guy, right?
42:36
He he's always disputed having any involvement in that.
42:40
But they got. But he was arrested at the
42:43
behest of the American government because they're
42:45
saying that, well, you are responsible because you were in
42:48
charge of that cartel. Whether you were personally
42:50
involved is irrelevant. It's like holding John Gotti
42:53
responsible for some guy getting knocked off in Boston.
42:56
It's like you can hold him accountable.
43:00
And so Feliz Gallardo's taking the position, hey, you know,
43:02
because that concept in Mexico, coca spirit reliability doesn't
43:06
really exist. Like you're applying an American
43:08
concept to hold him responsible for something under Mexican law.
43:12
In a whole other country. Yeah, in another country.
43:14
And that's why Mexico's like, we're not sending them over.
43:17
Now. Of course, they, they figured
43:18
they out. They, you know, they'll dress it
43:19
up like, well, it's inconsistent with the Mexican constitution.
43:23
And he'd be subjected to a life sentence.
43:24
And at the time, any Mexican national subjected to a life
43:27
sentence could not be sent to the US.
43:31
Had to do your time in Mexico. Had to do your time in Mexico.
43:33
And so following his arrest, the five cartels essentially give
43:41
rise to the modern cartel era. Well, the the individual that
43:46
was nominally in charge of Sinaloa was a trafficker named
43:49
Gwetto Palma. Actor Louise Palma, I think was
43:53
his name, but it was everybody just called him Gwetto Palma.
43:55
So Gwetto Palma was the older he was in his 50s.
43:59
Tropical Guzman was in his mid 30s.
44:01
Like, you know, he was a young, he was a former Lieutenant in
44:03
the Guadalajara network. His organization handled the
44:06
smuggling. Whoa.
44:07
He partnered with Guadal Palma because Guadal Palma already had
44:10
distribution people in LA, Zambada already had distribution
44:13
people in LA. Remember once they got, once
44:16
you're taking your payment in product, you have to be able to
44:17
cash out. So Guzman's like, OK, well, I'll
44:20
smuggle it to Los Angeles and you other guys from Sinaloa, you
44:23
guys have your people there handled distribution.
44:26
Well, there was a shipment, a multi ton shipment that the
44:30
Sinaloa faction of the Guadalajan network was
44:32
responsible for where the authorities intercepted to load
44:37
police. Gallardo and his nephews.
44:39
The Arianos blamed what Obama for the loss.
44:45
And so, you know, down there, a lot of the problems you get
44:51
personality disputes or a lot of it's driven by ego or envy.
44:57
And so the decision was made and of course hypocrisy.
45:02
And so the decision was made by Felice Gallardo and Yarianos to
45:06
UN alive what Obama Now they weren't able to get what Obama
45:13
and so we were able to get his wife and his children.
45:16
We discussed this earlier. This was the second most
45:18
important unaliving in the history of the Mexican drug.
45:20
Trade. It's the Venezuelan.
45:22
This is where they snatch up the wife, decapitate her, send a
45:25
hood to what Obama along with the videotape where they took
45:29
the kids to a bridge and threw them off the bridge like little
45:32
4 year old boy, 8 year old girl like kids.
45:36
So they couldn't get him. They couldn't get him.
45:37
They got the wife and the kids. This unleashes a 20 year war.
45:42
I'm at least 10,000 men have met their maker because of that
45:47
event. And so that creates A tremendous
45:53
amount of personal animosity. This isn't a circumstance where
45:57
we can negotiate. Cooler heads will prevail.
45:59
We'll give you a concession. You can have this route.
46:00
We'll give you a discount. You cut You cut a man's wife's
46:04
head off and throw his kids off a bridge.
46:05
There's there's there's no all bets are off.
46:07
No, no, Yeah, that's right. And so that.
46:09
You're dealing with, you know, people that aren't afraid to UN
46:12
alive people and people that well.
46:14
Look down there, there, there, no one's bulletproof think
46:18
they're coming. And so he at that point,
46:23
essentially loses his mind. He just goes on.
46:27
So now he's Chapo Guzman's partner.
46:30
His name is. What Obama?
46:32
So and so you had what Obama and Guzman, they're operating in
46:36
Sinaloa. They bring in Zambada, help with
46:39
the distribution. They bring in Guzman's cousins,
46:42
Beltran, who later on become a huge faction themselves.
46:45
And today it's the Cartel of the Northeast, another one of the
46:47
groups. So you got the Beltran group,
46:49
You've got what, Obama? You got Zambada, You got Guzman.
46:53
You got one other individual, I forgot his name right now.
46:56
You got another guy named Espatagoza.
46:58
You got another guy named Amaro Carido.
46:59
At this point, these are all the guys that come together to form
47:04
the core nucleus of what was originally the Sinaloa group.
47:06
Each one of them had their own organizations.
47:09
No one was in charge of any other persons organizations.
47:12
But what they did is they divvied up responsibility.
47:14
So you're going to handle distribution, check.
47:16
You're going to handle transportation, check.
47:18
You're going to handle smuggling, check.
47:21
And so you had this dynamic where Sinaloa more so than all
47:27
the other groups, because the other groups were essentially
47:29
vertically integrated. They were just top down
47:33
structures because Sinaloa was so far from the border they
47:37
they've always had an horizontal structure where no one leader is
47:42
in charge. If you've got a collection of
47:45
organizations that come together, it builds a lot more
47:47
resilience. This is one of the reasons why
47:49
they survived for 35 years while all the other structures were
47:54
ultimately taken down or undermined to a point where they
47:58
were ineffectual. Whereas the structure of
48:02
Sinaloa, because of their geographical proximity, you know
48:05
so much in what so much of what determines our lives is
48:09
geographical in nature. And people don't appreciate how
48:11
important it is. Well, that distance created this
48:16
necessity to, one, spread things out horizontally and two, bring
48:22
in other groups because if you're 900 miles from the
48:25
border, well, you got to be able to go those 900 miles.
48:28
These aren't Cowboys. Someone's got to be able to get
48:31
to that congressperson over here, or that general over there
48:34
or that chief of police over here.
48:36
So when it came time to partner with the group in Sonora, a
48:40
couple years after Sinaloa ban operations, they brought in the
48:43
group, the Salazars, where they controlled Sonora.
48:46
They had control of the port of entry, Nogales.
48:50
And so you see this effort. They brought in the guys from
48:52
Mitrocon, the Valencias. Then they brought in the guys
48:55
from the methamphetamine and Colima, the Domescuos.
48:58
And so like over the course of the years, that six organization
49:01
network that came together expanded to 7, expanded to 8,
49:05
expanded to 9. Now, why did they come together?
49:09
Because you had the group in Tijuana and the group in the
49:11
Gulf with the strongest political backing.
49:18
And so now if you're the politician supporting, if you're
49:20
the political elite supporting Tijuana and the Gulf, how do you
49:23
gain market share in the United States?
49:26
Well, if you can take out Sonata, if you could take out
49:29
Sinaloa, then the guys in Tijuana are by default are going
49:32
to inherit all that business. So the Mexican government, the
49:36
political class, were incentivized to begin attacking
49:41
the cartels that were disfavored.
49:45
So the government and selected who survived.
49:48
That's why throughout the 1990s, Tijuana and the Gulf were the 2
49:52
main cartels in Mexico. And so, and this is, this is
49:59
evident now because once Sinaloa, they had to be able to
50:05
start bringing the product in greater volume.
50:07
They couldn't use Tecate. It's not really, it's not an
50:12
optimal entry point. And so then from the beginning,
50:15
like by 1991, within a couple of years, like the first full year,
50:18
the cartels operation was 1990. By 1991, you had a team of guys
50:22
get sent to Tijuana because Guzman wants to negotiate with
50:25
the Adrianos for permission to use your passage.
50:30
Because the guys in Tijuana, they're making the money
50:32
smuggling Colombian product. They're making the money selling
50:35
their cut for the smuggling operation.
50:37
They're distributing it on American soil, and they're able
50:41
to charge a toll to come through their territory.
50:44
Now in Mexico, it's called bezel.
50:46
And so you may have hundreds of organizations in this territory.
50:50
Only two or three of them are cartel, but everybody has to pay
50:54
the bezel because if you don't pay the peso, they tell their
50:56
handler and the government, Juan doesn't want to pay peso,
51:00
they're going to go see Juan. The federalities are going to
51:04
go. Could they enforce the
51:06
collection of the tax? The people who collect the tax
51:09
is the cartel head. The cartel is just, we call him
51:12
a drug Lord. The Mexican political class,
51:15
that's the tax collector. See that that his job is to
51:18
maintain the collection of tax of all criminal activity within
51:23
a given area. So the chop shop guys got to
51:26
pay, the bookmakers got to pay. Open fish charter guy.
51:29
Any, anything that's illegal, you're paying into the system.
51:35
And so Guzman says, OK, well, we're not able to negotiate a
51:39
reasonable fee because Adriano said you can use our toll, but
51:43
we want X number per unit. They weren't able to negotiate a
51:48
they weren't able to come to a settlement that both sides were
51:51
comfortable with. Meanwhile, what Obama's like,
51:54
he's not alive and these guys as much he's shooting as many of
51:56
them as he can. So that of course, was
51:58
influencing the negotiation. He's still hot on the the wife
52:02
and kid getting unalived. So then Guzman sends A-Team up
52:06
into Tijuana to set up shop. They get discovered Yariano's
52:10
they aren't alive them. So in 92 they send up another
52:14
team. They get unalived.
52:18
Now who killed his wife and kids?
52:21
The Arianos had utilized the services of a foreign national
52:25
of Venezuelan. I forgot the guy's name, but he
52:28
was able to seduce the wife. Oh, it came that way.
52:33
Yeah, even worse. Yeah, so he was they they
52:35
seduced the wife and she agreed to leave with the Venezuelan.
52:41
So she goes to the bank and takes out with like $10 million
52:46
award Obama's money. She's having an affair on her
52:47
husband. Yeah, and she's like, you know,
52:49
I'm what, Obama's wife? Give me the money.
52:50
Right. They don't they don't know that
52:53
they give her the money. So she takes the the money and
52:57
the kids and leaves with her. Paramore he.
53:02
Was it this was from a rival cartel?
53:04
It was the guy that the Arianos had put up for this operation.
53:07
Now have they? Have they since learned that
53:09
they can't be doing that? I mean.
53:11
Well, like I said, thousands upon thousands.
53:13
To 10 of thousands. Well over 10,000 men met their
53:16
maker after this. This went on for the next 20
53:18
years. Is it still?
53:20
Is it finally over now? In 92, there was a huge event
53:23
where the Arianos were in Puerto Vallarta partying at the some
53:29
nightclub. Well, Sinaloa called one of
53:32
these guys being in, you know, Puerto Vallarta's in the Mexican
53:36
state of Jalisco and Sinaloa operated out of Guadalajara.
53:39
So they dispatch a team of men to go unalive these guys.
53:42
It was like 40 men showed up dressed as police officers,
53:46
could very well have been police officers.
53:48
But forty men show up at the nightclub.
53:50
They start shooting it out. Yadiano brothers get away.
53:54
Like a bunch of bodyguards get on alive, but they are able to
53:57
get away. So now they're like, oh, OK, you
54:00
guys want to play this game now. They send a team to go unalive
54:04
Guzman. Because at this point, they know
54:06
Guzman's fully partnered with what Obama like, there's no
54:09
negotiating with these guys now. So they send a team to go
54:12
unalive Guzman and this supposed to show you how corrupt the
54:16
Mexican government was at the time because PRI remembers
54:19
deeply tied to Tijuana. So the pre.
54:22
PRI, the political party the. Political party The Adrianos
54:25
send a group of hit men to go get Guzman at the airport.
54:29
Like they know he's going to be at, you know, United flight 3,
54:32
O1 leaving the airport at 2O clock.
54:34
So you're going to back then you just show up.
54:35
It's pre 911, so you can just show up at the airport at 1:40.
54:38
So they like they're waiting for him to show up at the airport.
54:41
I'm just using that as an example.
54:43
But whatever airline, whatever terminal and he was going to be
54:46
showing up and he's going to be driving this kind of car like,
54:48
you know, a white Buick. They had a dialed in, they had
54:51
their Intel. They had the Intel, right?
54:53
Well, the hitman ambushed the wrong car.
55:02
Say make and model. Not Guzman.
55:05
But not Guzman, and so they. On a live probably some innocent
55:10
people. It was the cardinal, the arch
55:12
cardinal for like the Pope Guadalajara, he was like for the
55:16
the highest ranking. So like the head of the Catholic
55:19
diocese in Mexico and all of Mexico?
55:22
Because we know Guadalajara. Do you have just then?
55:24
Like Mexico City of course is the capital, but Guadalajara is
55:26
the heart and soul. Sure, sure.
55:28
And So what the highest ranking? Mean massive Internet, you know,
55:31
Oh. How'd that end up being a
55:33
shitstorm? Shitstorm massive disruption in
55:36
a drug flow to LA. Prices sky rocketed after this,
55:38
totally disrupted the markets because at that point the
55:41
Mexican government, there was such an enormous outrage.
55:45
They had to do something. They had to do at least
55:47
optically window dressing to because there was too much heat.
55:51
Yes, and so the Ariano sent this group of hitters to go grab
55:54
Guzman. Guzman, they shoot.
55:55
They missed Guzman. They unalived the Cardinal
55:58
Guzman. And the poor cardinal wasn't
56:00
doing nothing wrong, right? He just being a cardinal.
56:02
There's all kinds of conspiracy theories as to.
56:05
Oh, he might have been. But there was.
56:06
But they've never been I, I look, I, I don't, I go with the
56:11
most, the simplest explanation. Like there was an incentive by
56:15
the Arianos to take out Guzman and it's just bad timing, bad
56:20
place, wrong place, wrong time for the cardinal.
56:23
So he gets unalived. Now, did Guzman know that they
56:26
took out the Cardinal and it was supposed to be?
56:28
Because he shows up and he's like, holy shit, they're all
56:31
shooting up that car. That's my kind of car, like.
56:34
So Guzman knows that hit was supposed to be for.
56:37
Him. Yeah, he takes off.
56:38
See, Now, here's the thing. You had the attempt on the
56:42
Arianos by the Guzman. And what?
56:43
Obama at the nightclub in Puerto Vallarta a month before they
56:47
hit. Arianos retaliated by hitting
56:49
the cardinal. The first tunnel was discovered.
56:53
So it turns out that Sinaloa had secretly constructed a tunnel in
56:59
Tijuana and were smuggling loads.
57:02
Through the tunnel. Without paying any peso at all.
57:07
So now the guys in Tijuana are infuriated.
57:09
Like, hold on a second. First of all, you guys are
57:13
unaliving our people. Two, you try to unalive the
57:16
leadership of the Tijuana structure itself.
57:18
Three, you're operating a clandestine tunnel on our
57:20
territory. So that's when they send a group
57:23
of guys to go get Guzman. So now the tunnel disruption was
57:28
a huge event because now this is the first narco tunnel in the
57:31
San Diego area. And at the same time they bring
57:35
in geologists to determine most optimal location.
57:40
Like it's not poncho with a tunnel and some buckets.
57:42
It's not poncho with a pick. And.
57:45
A water jet. It's it's.
57:46
That's not how it works. They bring in German engine,
57:48
they bring in engineers from Germany and they bring in the
57:52
geologists and they'll bring in the, you know, they'll determine
57:55
like the. Now whom will they bring in?
57:57
A tunnel manufacturer. They have teams that are
58:00
dedicated, they come to Nilettos and they're just responsible
58:03
for. Tunneling.
58:04
Tunneling Now when? Who usually finds that?
58:09
Who usually discovers the tunnel?
58:10
The government. Or.
58:12
American will, will or the DEA or whoever will find a tunnel.
58:17
Now they shut it down? I'm assuming yes.
58:19
And do they concrete it? They concrete it, yeah.
58:22
So they just I mean, think about having that contract where think
58:26
about how much concrete you got to throw down a tunnel to get it
58:29
non non operational. Think about the concrete, you
58:32
know, contract. Like last year, there was a
58:34
tunnel that was taken down in the Southern California area,
58:37
coming into the the greater San Diego area, and that tunnel was
58:40
operating for 10 years. Probably 24 hours a day,
58:44
non-stop. I mean, it's not operating all
58:46
the time because let's say you get a 20 ton shipment, it may
58:48
take you a couple of days to move to 20 tons because you have
58:50
to have the ability on the American side to divvy it up
58:54
because they don't, the people don't come to.
58:56
I don't know one person's taking 20 tons.
58:58
Well, no one comes to the warehouse that houses the exit.
59:04
So you have to have, you have multiple tunnels, multiple
59:06
warehouses and the tunnel come up into a warehouse on the OTA
59:09
Mesa side of the border in San Diego and then in the commercial
59:13
zone. So that tunnel, that warehouse
59:15
that houses that tunnel exit will collect the product and
59:19
then send it to a secondary warehouse where it'll get put
59:22
into vans. To take it to the point of
59:25
context, like the the the American citizens that have the
59:28
commercial driver's licenses, truck drivers, yeah, they don't
59:32
ever get, nobody gets to know the location of the warehouse.
59:35
This is all compartmentalized. And so they just, they do, they
59:39
just infuse that into loads that are already going across
59:42
America, you know, like a produce load or a, you know,
59:48
stuff that are stuff that's exported out of California on
59:51
trucks. Sure.
59:52
I mean, well, yeah, for Sinaloa, of course, most of it they they
59:55
build them into the cabs. You know, it's, it's hard to get
1:00:00
them into the the trailer park unless it's hard.
1:00:04
You can't, you can't load them in the United States.
1:00:08
There's too many people involved.
1:00:09
Whereas in Mexico you can load like a lot of the agricultural.
1:00:12
So you'll see at the border shipments getting busted because
1:00:14
they intercepted, you know? They were hauling 12 tons of
1:00:18
jalapenos or agricultural goods that get loaded into the
1:00:23
trailers in Mexico. Those trailers are used to
1:00:26
smuggle product. One, because you can have, you
1:00:31
don't have to worry about one of the people there pick up the
1:00:33
phone and calling the FBI because those are all vetted
1:00:36
individuals that are loading the trailers and all of their
1:00:39
families lives are at stake. And if the load gets busted,
1:00:43
everybody gets assumed it's having when they when they take
1:00:47
out a a cell, everybody gets on a lot.
1:00:49
But there's getting it across the American border, and then
1:00:53
there's distribution within America.
1:00:54
Well then, because it's already loaded into the trailer, so you
1:00:56
can just take that trailer to Chicago.
1:00:59
They don't load the trailer in the US.
1:01:01
If if, if it's a non trailer load, if it's just a regular
1:01:05
haul, they'll put 150 a 180 kilos in the cab of the truck
1:01:08
and then you just load. You just haul whatever comes out
1:01:10
of the port in Long Beach. Yeah, so you're taking your
1:01:13
lettuce, your tomatoes, your oranges?
1:01:14
Whatever the hell your regular citrus, but if it's loaded in
1:01:17
Mexico, you want to use the agriculture because 1.
1:01:21
You can preload the product multiple tons and two trucks
1:01:27
that carry perishable goods receive expedited consideration
1:01:30
at the border. They don't make them wait there
1:01:32
and sit there and make. So you're not going to have to
1:01:33
sit there. You're not going to put that
1:01:34
truck in a secondary inspection for three days.
1:01:38
They're getting that truck through.
1:01:38
They're getting that truck through or in.
1:01:40
Fear of spoilage. And things like that.
1:01:42
That's the So the system is incentivized to expedite.
1:01:46
And there's probably, you know, the way the cartel operates,
1:01:50
they, they already have the Mexican government in their back
1:01:53
pocket. They probably have, you know
1:01:56
what, when you're talking about those type of quantities coming
1:01:58
into LA or or Tijuana into San Diego, you have to have some
1:02:04
infrastructure of guards or, or do you think that it's truly a
1:02:08
smuggling or, or? The coming into the United
1:02:10
States is smuggling Now there are.
1:02:11
Agents are just so overwhelmed that they cannot stop every
1:02:15
produce truck you got. You got 15,018 thousand tractor
1:02:18
trailers crossing the border every day, every day from
1:02:21
Tijuana and. How many?
1:02:22
Oh, so let's just call it 16,500 tractor trailer.
1:02:26
How many of those can you really genuinely expect?
1:02:30
Inspect 100, 100. Yeah, 100.
1:02:33
And if you do 1%, it's 165 trucks out of 16,000, right?
1:02:36
So just just a pure statistics and then the fact that the
1:02:40
produce trucks are expedited and you know, stuff like that.
1:02:43
So you know. And so, you know, like in Chapo
1:02:45
Guzman's trial, one of the key witnesses in the case for the
1:02:48
American government, they were auditing the books, entering the
1:02:51
books into evidence and the individual witness who had first
1:02:55
hand knowledge of the what the annotations represented.
1:03:00
They added that all the calculations up and it reflected
1:03:03
that the American government was intercepting one out of 100
1:03:06
loads. 1%. 99 of them make it through, only one gets
1:03:09
intercepted. I mean.
1:03:12
It's just that and then of course you have the other
1:03:14
overland airportation operation with the private civilian
1:03:16
vehicles. You got 50,000 cars crossing the
1:03:19
border every day. Now.
1:03:20
So you send 200 cars with 40 kilos in each one.
1:03:23
That's eight metric tons. So now going into 1990, with the
1:03:26
birth of the modern era, you had the element of competition get
1:03:31
introduced. And so now Tijuana's trying to
1:03:34
gobble up Sinaloa's market share, the Gulf is trying to
1:03:38
gobble Wadas's infrastructure. So now Wadas and Sinaloa form an
1:03:43
alliance and see this is a dynamic you see.
1:03:47
This is a 90 and this is. In the mid 90s, because you had
1:03:52
an operation that became what I refer to as the air bridge.
1:03:55
And this is the operation that kept Sinaloa alive.
1:03:59
And it was a aviation based operation where 3 drug Lords,
1:04:03
Amaro Carrillo, Ismael Zambada and Armando Valencia put
1:04:09
together an operation where they were taking private civilian
1:04:11
airliners, gutting them, turning them into cargo planes like
1:04:15
720-7737. Big planes, yeah.
1:04:17
The American government built the state-of-the-art radar
1:04:20
system to be able to intercept and identify UN authorized
1:04:26
flights like unsignalled flights emanating from Colombia to
1:04:29
coming to Mexico. So the leader of that operation,
1:04:33
the radar unit, that General was, he was getting paid X
1:04:36
number of millions of dollars, the guy that controlled.
1:04:39
The on the on the on the. American on the Mexican side.
1:04:41
On the Mexican side. Yeah, because that's the
1:04:43
Americans built the facility. Now the Mexican military runs
1:04:45
it. So the Mexican general's like,
1:04:47
hey, we'll, we'll let your flights come through.
1:04:49
We want this much money per month.
1:04:51
Remember every every 20 metric ton load as a wholesale value in
1:04:57
Los Angeles of $300 million and those 20 ton loads in Colombia
1:05:02
will cost you about 40 million. So there's, you know, you got a
1:05:05
200 and 260 million. Profit.
1:05:08
Now, of course, you're going to have to pay for the general that
1:05:12
controls the radar operation. Then you got to pay the the
1:05:14
military. That's the general that's
1:05:16
responsible for the military district out of Guadalajara.
1:05:18
Then you have to pay for the military general that's
1:05:20
responsible for the the military district out of Sonata.
1:05:22
Then the general that controls the air base, you got to pay
1:05:24
him. Now how about the how about the
1:05:26
US guy? Well, do you?
1:05:28
There is no US. They we built that for them.
1:05:31
The Mexicans run it. Or they catch it there.
1:05:33
They just catch them on the Mexican side.
1:05:34
So you're going to have the 7:30 sevens or 720 sevens landing at
1:05:37
the air base in Sonata, uniformed military, Mexican
1:05:39
personnel, unloading the planes, guarding the planes, and then
1:05:43
transporting it to the border. And and.
1:05:46
Then they hand it off to. But they're but they're also
1:05:50
arresting and intercepting the guys that aren't doing business
1:05:53
with them. Only in that area.
1:05:56
Yeah, that's what I'm saying. Yeah, in that.
1:05:57
Area. There's, there's, there's very
1:05:58
few. There's very few outliers,
1:06:00
outliers. Because if the if the cartel
1:06:03
catches you operating outside of the scope, they may unalive you,
1:06:07
or if not, they'll hand you off to the authorities, then they'll
1:06:10
get like, you know. 15 year in prison.
1:06:12
Like a bus that they were able to go on the news every once in
1:06:16
a while. They got to, you know.
1:06:17
Every once in a while they got to say, hey, look at us, we're
1:06:18
here doing Drug Enforcement. Corrupt police officer is not
1:06:21
corrupt all the time. In fact, the guys that are
1:06:25
corrupt have to create the appearance of being the most
1:06:27
professional. Right.
1:06:29
The guys are the correct suspicion.
1:06:30
They got to bust somebody to make it look good, so they bust
1:06:32
your competition. They bust the competition now
1:06:34
where they can go to the gringos and say, hey, look, we took this
1:06:36
guy down, this guy down this guy, oh, Atta boy.
1:06:39
Meanwhile, the whole time the guys taking duffel bags of cash.
1:06:41
And so this air bridge operation.
1:06:45
This is like. 93 to 97 is what kept Sinaloa alive because they
1:06:51
were under tremendous pressure from do you wanna under
1:06:54
tremendous pressure from the Gulf.
1:06:56
Now after the attempt on the cardinal, after the attempt on
1:06:59
Guzman, they unalived the cardinal just said represents
1:07:02
how illustrates how corrupt the government was.
1:07:04
A month later they arrested Guzman.
1:07:08
Now he's the target of the hit. Oh yeah, the guy they were
1:07:11
trying to kill. Yeah, in lieu of the Cardinal,
1:07:14
they now go the Mexican. Authorities, the pre political
1:07:17
party says we got to arrest somebody you got to get somebody
1:07:20
in jail for. Well, yeah, because the
1:07:21
Cardinal. Yeah, it's the cardinal, But
1:07:22
they didn't want to arrest the people in the Adrianos and TJ
1:07:24
because they're the ones paying them.
1:07:26
So they said, well, let's go arrest the victim of the
1:07:28
intended. Hit so they get Guzman.
1:07:30
Like, put Guzman in jail on this.
1:07:31
There you get the famous pictures of Guzman sitting in
1:07:33
jail back in 93, and he's given a statement to the authorities.
1:07:36
Like, what are you people doing? Like they're trying to get me
1:07:38
like. I would say it.
1:07:40
But that's that's that illustrates just how corrupt,
1:07:43
corrupt Mexican government is like what we need, is it?
1:07:46
Still that way still, I mean, it probably will never change, will
1:07:50
it? I mean, it's way, it's the way
1:07:52
of life. It's the way it's been set down
1:07:54
like it's just the way it is. Can I ask you a question?
1:07:56
Is being the Mexican president a highly volatile, potentially get
1:08:03
assassinated type job or do you have?
1:08:05
No, because it's. Remember, you have well in the
1:08:10
modern structure you have like, let's say Morena controls the
1:08:13
presidency, but you're going to have numerous senators and
1:08:16
generals that are associated with pre numerous generals
1:08:18
associated with pond. Like it's it's in no one's
1:08:22
interest to place the political structure in jeopardy.
1:08:29
Like they don't care about the narcos.
1:08:30
It's that's why when they took Zambada, all of the parties are
1:08:33
like, hey, hey, hey, hey, hey. That is unacceptable.
1:08:37
Like narcos aren't allowed to decide who gets handed over to
1:08:40
the Americans. That's the power that the
1:08:42
Mexican government reserves for themselves.
1:08:43
That's what we do. Because they got to be able to
1:08:46
filter and evaluate. What's the consequence?
1:08:48
They have to. Control who?
1:08:50
Who does and gets what? So when they hand over Chapo
1:08:52
Guzman, it's because he didn't pose a threat to the political
1:08:55
structure. But when they went to go get El
1:08:58
Mencho recently, El Mencho wasn't coming to the US.
1:09:01
When they went to go get Nacho Coda now, no, no, no, no, no,
1:09:05
no, no, no, no, no. When they went to go get Arturo
1:09:07
Beltran, No, no, no, no, no. Cornell's paying the Mexican
1:09:11
equivalent of the FBI director. Arturo Beltran's paying the
1:09:13
Mexican equivalent of the Secretary of Defense.
1:09:15
Those guys don't hand over those guys, no.
1:09:17
You get. That's their golden goose.
1:09:19
They no, they when they happen to resist the rest and they
1:09:23
don't survive the encounter when the authorities come to get
1:09:25
them. And of course, they report back
1:09:28
to the American government. We went to go get Nacho
1:09:29
Cortanell and you know 200 of our bravest soldiers surrounded
1:09:34
him and Golden L pulled out his 9mm and tried to blast his way
1:09:37
out. So we had to get rid.
1:09:39
Of him, he didn't survive the arrest at Narco.
1:09:42
You think Golden L pulled out a 9mm with 200 men?
1:09:44
No. So you know, I mean the same.
1:09:47
Same thing if you believe the narratives that come out are
1:09:49
just preposterous, right? But that's the same thing when
1:09:52
they've said, you know, when the American government said we want
1:09:53
Artuto Beltran. No, no, no, no, no, no, no.
1:09:56
You're not going to get Artuto because the secretary of the
1:09:57
friends, like. All right, Mr. Obama, we'll go
1:10:00
get them for you. That guy's getting 60 million a
1:10:03
year. The Secretary of Defense in
1:10:04
Mexico, for real? Yeah.
1:10:06
He's not handing over to this guy.
1:10:07
Are you crazy? 60 million a year?
1:10:10
Sure. No, to protect that network to.
1:10:13
Protect that way of life. Yes.
1:10:15
And so like within the Calderon administration, there were four
1:10:18
cabinet level officials who split $270 million.
1:10:23
You had the head of their their public minister of security,
1:10:26
like their FBI director Hanato Luna was getting $50 million a
1:10:29
year. He was part of an 11 man
1:10:32
corruption network, highest ranking federal law enforcement
1:10:34
community in Mexico. They split 450 million.
1:10:38
And they all got away with it. Well, and now the Luna made the
1:10:40
mistake of coming to American soil.
1:10:42
He got snatched up. So they were good if they
1:10:45
stayed. Yeah, stay in Mexico.
1:10:47
Like the general that was done to take from the Beltrans San
1:10:51
Fuegas. He got arrested at LAX when he
1:10:54
was cutting through the international terminal.
1:10:55
They snatched him up. So why would they even think
1:10:59
about travelling to the US if you got if you're that, if
1:11:01
you're taking that type of money in Mexico?
1:11:04
It's arrogance and hubris. And remember, for 50 years the
1:11:08
American government looked the other way.
1:11:09
They focused on the Chapo's and didn't focus on the generals.
1:11:14
As things changed. Yes, but for the.
1:11:19
Purpose. Or is it only for window
1:11:20
dressing? Well, no.
1:11:21
The American government has legitimate geopolitical
1:11:24
interests that they want to achieve, and they'll use the
1:11:29
threat of prosecution with respect to the political class
1:11:32
to achieve whatever their particular goal is.
1:11:35
The least important goal is disrupting the drug flow.
1:11:38
Now what about the synthetic chemical pipeline?
1:11:42
Well, OK. So then in the early 90s, so
1:11:44
yeah, that mid 90s operation, the air bridge.
1:11:46
The air bridge. OK.
1:11:48
And that was an enormous asset for Sinaloa.
1:11:51
Or had to be, because it was probably first of its kind on
1:11:54
that scale. It was the most successful.
1:11:58
Because we've all seen like the Cocaine Cowboys and these little
1:12:01
Cessna 172. Yeah, this was this was a
1:12:04
massive. Operation This was massive.
1:12:05
In fact, the. Individual that put that entire
1:12:07
together was a retired US Air Force officer.
1:12:09
Really. Yeah, Living in Mexico,
1:12:11
obviously. He was an American living in
1:12:13
Texas. Did he get busted still?
1:12:17
Still in? No, he's out.
1:12:18
Out. But yeah, there was an American
1:12:20
Air Force officer retired who had, you know, look, Amato
1:12:24
Carrillo gets the credit. In fact, his nickname in Spanish
1:12:26
was the Lord of the disguise. But he didn't.
1:12:30
He's not a pilot. He's a smuggler.
1:12:33
So he contracts with the Americans, who was a logistical
1:12:35
specialist for the Air Force, and he's the one who recruited
1:12:38
the pilots. He himself was a pilot.
1:12:40
How much money did they say he potentially got and how many
1:12:43
years did he get, do you know? He got over 25 years.
1:12:47
Oh man. Yeah, he got a, He got a big
1:12:48
sentence. And there's a guy like that, you
1:12:51
know, a general from the US Army that helped.
1:12:54
He wasn't a general, he was a lower ranking officer.
1:12:56
I don't want to disclose Guy's identity.
1:12:57
So whatever. So this, this this US
1:13:00
high-ranking US guy, but not a general who orchestrates the air
1:13:04
cargo gimmick, does he? And does 25 years, you know,
1:13:09
whatever does he does, does he keep any of it?
1:13:13
Does he get to keep any? I mean the the probably the mass
1:13:16
quantity of money that went through his hand because of the
1:13:19
scale of this operation was are you allowed to he's.
1:13:22
A functioner, he's getting paid on a per flight basis.
1:13:27
And so not like that. Go out and bury, you know,
1:13:29
152030 million, you know. You can invest in Mexico and
1:13:33
Mexico was easy to get a false passport, another identity and
1:13:35
you just open up bank accounts in Panama under the Mexican
1:13:37
passport and American government.
1:13:39
Your money and your money's OK, Yeah, yeah.
1:13:41
You're, you're, you know, you're Juan Carlos.
1:13:44
I'd love to be American. American government's never got
1:13:46
to be Juan Carlos. I like to be your brother.
1:13:47
I want to be, I want to be, I want to be, I want to be Bubba
1:13:51
Rossini. And so then you know, that way
1:13:53
when you, you know, if you divorce your wife, she never
1:13:55
gets to not money because she doesn't know about it.
1:13:57
American tax persons Tax authorities never know about
1:14:00
that money. How do you get that money out?
1:14:02
How do you get that money out of Mexico though?
1:14:05
For what purposes? Just for purposes to buy a new
1:14:07
car well. You're gonna have an offshore
1:14:09
company, then you're gonna have a credit card on that company.
1:14:12
So then you just travel outside. Yes.
1:14:13
So you travel into Mexico, but under your REAL ID.
1:14:17
When you get to Mexico, you pull out your Juan Carlos passport
1:14:21
and now you've got a separate, you know, passport
1:14:24
identification plus your credit cards, and you just go down to a
1:14:28
Rio and party and you. Do your thing.
1:14:30
And you withdraw your billing the money to the count out of
1:14:33
Panama. So now while this operation is
1:14:36
going on with the Valencias and Valencia is the one who
1:14:41
coordinated between the Colombians, Zambada and Amata
1:14:43
Carrillo. And so now by 93, the Sinaloa
1:14:49
Group, the original 5 or 6 organizations kept expanding.
1:14:52
So 91 they added to Salazars, which gave them the operation
1:14:55
into Nogales through Arizona. Then in 92, you had a separate
1:14:59
group in Colima called the Amesculas.
1:15:02
They focused on methamphetamine. And from here on out, we're not
1:15:05
going to say the full name, but that that was their synthetic
1:15:09
and the Amescua out of out of Colima.
1:15:13
He's one of the guys in the far background of my case.
1:15:15
Like the government never apprehended it.
1:15:17
And so he was, he'd hang out at Robust nightclub, which is the
1:15:21
at the time, there was a major drug trafficker in Los Angeles
1:15:24
named Robles. Robles nightclub was the place
1:15:26
to be, wasn't it it? Was the hottest club in Orange
1:15:27
County. Yeah, I mean.
1:15:29
Yeah. And so.
1:15:30
And it was the stereotypical big money bottle service hot chicks,
1:15:35
you know, got, you know, got drug, big time drug guys with a
1:15:38
lot of money, a lot of a lot of show off, a lot of a lot of
1:15:45
playing the game, so to speak. Right.
1:15:46
Yeah. You know, 'cause everybody knew
1:15:49
who Robles was, and he was himself.
1:15:50
What kind of cars did those guys pull up in those like back in
1:15:53
the day? Well, it'd be a lot of Ferraris,
1:15:55
a lot of Porsches. Like that, Yeah.
1:15:57
Ferraris, Bentley, Porsches, like Bentleys.
1:16:00
Would you drive back in an? AP I'd show up either in a 9/11
1:16:03
turbo or a BMW. Really.
1:16:07
Yeah, that was kind of your jam. I was in to be. 911 You like the
1:16:11
Beamers didn't you? 7 Series I had.
1:16:13
But my last one was yes, seven series.
1:16:15
Yeah, nice. I went from A3 to A5.
1:16:17
We had to graduate up, you know, a small scale, bigger scale,
1:16:20
larger scale, right? So, but I'm at 700, you know, I
1:16:23
mean, I'm just home rolling. A Med school was able to develop
1:16:26
the production capacity in Colima, but then they get
1:16:28
wrapped into the broader Sinaloa network.
1:16:31
Well, here's in a totally different additional revenue
1:16:34
stream. And so now in Los Angeles, you
1:16:38
had the the smuggling operation from Guzman's was centered near
1:16:45
around the LA County community, around Hacienda Heights, the
1:16:48
distribution office, you had two offices, but the main office was
1:16:51
in my hometown of West Covina, which was run by Zambada's
1:16:53
people. And then you had what Obama's
1:16:55
distribution office was in Santa Monica, Valencia's was down in
1:16:59
Orange County. And so Valencia's operatives
1:17:05
socialized at Robust nightclub. This is the backdrop of my case
1:17:10
because these were Robust was actually charged and one of the
1:17:13
prosecutions related to my case. And so well, in addition to the
1:17:19
Valencia operatives partying at Robust nightclub, Valencia's
1:17:24
operatives were the people that were responsible for trafficking
1:17:26
the synthetic, the meth in the United States.
1:17:29
So the Colima Group, the Mesculus produced the product,
1:17:32
but they didn't have a distribution capacity.
1:17:34
So they produced it and supplied it to Valencia.
1:17:38
Well, Valencia was already distributing because his
1:17:40
operations distribution was down in Orange County.
1:17:43
So you had the two coke offices, Zambada and what Obama's the
1:17:49
meth, the synthetic office was in Orange County.
1:17:52
And that same nightclub was also the club where a bunch of Asian
1:17:56
guys, ethnic Chinese or Vietnamese that were ethnically
1:18:01
Chinese or Vietnamese, but the the ethnically Chinese guys were
1:18:06
part of the 14K triad. And so now you had the Chinese
1:18:10
partying at the same nightclub with Valencia's people.
1:18:15
And a relationship developed where the Chinese were able to
1:18:22
source the precursors. Like today they don't sell
1:18:24
precursors, they sell the chemicals used to make
1:18:26
precursors. It's like one step removed.
1:18:29
So they that's what they've done and try to stop that, but now.
1:18:32
But back then it was just wide open.
1:18:33
Wide open you could get a precursor.
1:18:34
All day you could. Get the ingredients.
1:18:36
I think you could collectively get the ingredients to for meth.
1:18:40
It was, it was going for I think it was like $17.00 a pound, like
1:18:42
$34 a kilo. Excuse me?
1:18:44
That's it. Yeah.
1:18:46
And so that $34 worth of at the, the precursor was referred to as
1:18:50
ephedrine. And so out of that $34
1:18:53
investment, you're going to be able to produce 2 lbs of the
1:18:57
synthetic, which in LA had a wholesale value at the time of
1:19:01
$7000. Then it would get sent over to
1:19:04
the activity that was charged in my case, which was converting it
1:19:07
from the raw into the L ES multiple form called ice.
1:19:11
Well, it went from. Which is the final product.
1:19:13
Correct, Yes. So it went from, because that's
1:19:14
the time the Mexicans didn't have the capacity to produce the
1:19:19
highly purified form. We had the chemist from USC that
1:19:22
was involved with our operation. And keep in mind, it's Chinese
1:19:25
organized crime, not Chinese government.
1:19:29
It's the elements of organized crime partnered with elements of
1:19:33
Mexican organized crime. And the precursors were
1:19:37
literally one reaction away. Like today, you have to do
1:19:43
multiple reactions to get to the precursor.
1:19:47
But back in the day, they just gave you the precursor is.
1:19:48
That the precursor. That you got.
1:19:49
You just have to go. That reaction is done in
1:19:51
Sudafed. That that reaction is done in
1:19:53
No, Sudafed is not. That's the that's the American
1:19:56
version. Later on for the the the
1:19:59
Mexicans were bringing in tons of ephedrine.
1:20:02
So Sudafed was the American way to to get one molecule.
1:20:07
In the early 90s, you had the umesculos take over that
1:20:10
operation, create that business at A at scale.
1:20:16
They handed the product off to the Valencias.
1:20:18
Valencias brought it to Southern California.
1:20:21
They supplied it to Robles. Robles contracted with my
1:20:24
roommate and one of my, who he knew through my best friend to
1:20:29
handle the conversion. So the conversion labs were up
1:20:31
in Beverly Hills. So the product would come from
1:20:33
Mexico to Newport Beach, Newport Beach to Beverly Hills,
1:20:36
converted and then sent back the Robles.
1:20:37
How long is the conversion process?
1:20:39
It's the crystal growing period because you're going to have the
1:20:43
huge shards that that that takes the extended period, but the
1:20:46
actual process. Is there a growing?
1:20:48
Is it grow? Sure, of course.
1:20:50
So is it like a you're going? To take it from a liquid to a
1:20:52
solid, like growing salt when you were in grade school or high
1:20:56
school, whatever the hell, you do those experiments now you're
1:20:58
growing crystals. My my buddy who was on the drug
1:21:01
task force in Indiana said that they would target farmers
1:21:05
fertilizer. It didn't think Don't they need
1:21:09
an anhydrous fertilizer to be able to make the conversion?
1:21:14
There that that's for the actual manufacturing, OK.
1:21:17
That's what they were doing in Mexico with the, they were
1:21:19
producing the raw and they sent the raw.
1:21:21
OK, so you know that. Was a product that you already
1:21:24
got. Yeah, that was they didn't have
1:21:25
to use the antihydrates because they actually had access to the
1:21:27
precursors. Correct.
1:21:29
But like farmers in Indiana, they have to really watch out
1:21:32
their their fertilizer because these crack heads.
1:21:35
These. Knuckleheads, yeah, these
1:21:36
knuckleheads will go out and then the other thing, and again
1:21:38
I'm just telling you at St. Level.
1:21:39
What I've heard is that they need like 9 Volt battery strips
1:21:43
for. For and.
1:21:45
He would look at my buddy would look at these users, these
1:21:48
crackhead fingers, and at times they have cuts on.
1:21:51
Them those are small little. So those are just little
1:21:53
microcosms, little mom and pop guy that are supporting his own
1:21:55
habit. These are the bat bat.
1:21:57
These are small loads. These the guys in Mexico are
1:21:59
making. They have very sophisticated
1:22:01
labs like our lab, the one we had with the chemist.
1:22:04
You didn't see anything like that in the US.
1:22:07
There was. And did it, I mean, could the
1:22:09
chemist be like, OK, wow, as a as a USC professor, I made X,
1:22:15
but as this guy I could make, well, yeah, he got X * 10.
1:22:19
Sure, he done wiped out in 2 divorces and at the time he
1:22:23
recently retired he was in his 60s.
1:22:25
Now, does a chemist look at the molecular?
1:22:29
I don't even know if that's the right word compound of what
1:22:32
you're trying to get and then figure out or is it pretty much
1:22:36
just already sent to you raw material?
1:22:39
You take the raw material and then you get to put it as an
1:22:41
instrument called the gas chromatograph, and it breaks
1:22:43
down to chemical composition. And so I would like, OK, well,
1:22:47
we want to learn how to make this compound.
1:22:49
You don't give him the street name for it, right?
1:22:53
Just give him he'd break it down.
1:22:54
OK, that's two CB. And we can use that to enhance
1:22:58
the MDMA, which is the ecstasy. But this is how we produce the
1:23:01
MDMA. This is how we produce the
1:23:03
precursors, because everything at the chemist's lab was legal
1:23:06
when the manufacturing runs started.
1:23:07
But this is how you're going to produce this precursor.
1:23:10
This is how you produce this precursor.
1:23:11
So we would reverse engineer every one of them to start with
1:23:14
non legal chemicals, non illegal chemicals.
1:23:17
So what was the synthetic chemical pipeline?
1:23:20
So then the umesculus partnered with the Valencias, The
1:23:25
Valencias partnered with the Chinese.
1:23:28
Get those Chinese involved every time, don't you?
1:23:30
Anytime there's some corrupt shit, you got to bring the
1:23:33
Chinas. Well then they bring in.
1:23:34
They nowadays start flooding in. Is it because they're so smart?
1:23:38
No, it's just that they had accessibility.
1:23:41
You know Guangzhou is the largest concentration of
1:23:44
chemical companies in the world and the IT just so happened at
1:23:49
the 14K which you know we have 4 triads in Los Angeles.
1:23:52
Their office was located in Orange County, literally in the
1:23:55
little beach town right next to Rd.
1:23:57
This is nightclub. No.
1:23:59
They're like, yeah, like my girlfriend lived in the same
1:24:01
town too. So like, I could drive if my
1:24:03
girlfriend's place to the nightclub is 10 minutes.
1:24:05
And she lived like right outside of the ethnic Vietnamese and
1:24:10
Chinese community right there. And so that relationship allowed
1:24:15
for the development of ties with respect to sourcing all the
1:24:20
chemicals that represented an entirely different revenue
1:24:24
stream that Sinaloa had control of because Sinaloa, although
1:24:29
geographically they're disadvantaged with respect to
1:24:31
smuggling into the US, they're very advantage in that the two
1:24:36
largest ports in Mexico fell within their territory.
1:24:39
Well, these are strategic assets.
1:24:40
Like you, in Mexico, they fight for control of strategic assets,
1:24:44
whether it's a key border crossing.
1:24:46
Or a port. Or a port or key corrupt Mexican
1:24:50
political figures. Well, ports allow them to bring
1:24:54
in the precursors that they needed unabated.
1:25:00
Now, the American government, by the time in the middle of my
1:25:04
case, it was now 1995, the US government had imposed
1:25:08
restrictions because this is when the first time you started
1:25:12
seeing synthetic. Prior to this era, I was all
1:25:15
controlled by the Hells Angels. You know, the synthetic market,
1:25:19
you know, like it was a, it was perceived as being, you know.
1:25:25
Kind of white trashy type, kind of dirty butt, kind of.
1:25:27
Yeah, like a white trashy type thing.
1:25:29
Well, the smokeable, highly purified form became very chic.
1:25:36
And so the pound of the raw that was going for 3500 in LA after
1:25:41
the conversion process up in Beverly Hills now had a
1:25:44
wholesale value of 15 to 18,000 per, remember, $34 to produce
1:25:50
36,000 worth of product. Then you go from there to
1:25:54
Honolulu and it was going for 40,000 a pound.
1:25:58
So now you're talking $34, let's say $100 total to produce
1:26:03
$80,000 worth of product, wholesale value.
1:26:07
And so like my case, my investigation of FBIDEA formed
1:26:10
as massive strike force because it was like the first of the big
1:26:14
cases and the DEA working in conjunction, I believe it was
1:26:21
with the FDA, they wanted to restrict the availability of the
1:26:26
Americans to be able to produce like they'd missed the picture,
1:26:29
like most of it was coming out of Mexico.
1:26:31
But they're still working under the paradigm that does this
1:26:34
increase in the amount of product in the synthetic, and it
1:26:37
must be from American producers. They had to be building here.
1:26:39
So then they restricted the availability of ephedrine.
1:26:43
Right. You could only get like one per
1:26:45
person. Yeah.
1:26:46
But to that point, like you were able to buy cases like on the
1:26:48
American side, you did have guys that were still operating.
1:26:49
But look, the Mexicans are sending at that time large
1:26:52
loads, 3, four, £500 at a time. And so they restricted the
1:26:57
supply of ephedrine domestically.
1:27:00
Well that just gave the market to the Mexico because they had
1:27:07
essentially unlimited supply. So all of a sudden those 55
1:27:10
China, those 55 LB canisters where they were getting there
1:27:13
for you know $17.00 a pound, those canisters start going for
1:27:17
sale at the border at the front data for 8085 thousand just in
1:27:21
the ephedrine. So they start supplying.
1:27:25
It's on the precursor. It's on the precursor.
1:27:26
They're making enormous amounts of money.
1:27:29
And I don't even necessarily know how illegal that is.
1:27:32
Well, of course it's it's. So just even just even owning A
1:27:35
precursor, not even the not even the final product, Yeah.
1:27:39
But if you're obtaining it for the purposes of ultimately using
1:27:41
it to produce. But I mean, wouldn't they be
1:27:43
only be able to bust you if they would be able to find the final
1:27:45
product? Or do they have a it's?
1:27:47
A conspiracy? Charge.
1:27:47
So it's a conspiracy charge. Just having 55 gallons of
1:27:51
ephedrine means you're gonna make meth well.
1:27:55
If you're a pharmaceutical wholesaler, the American
1:27:58
government unwittingly handed that entire marketplace, the
1:28:02
Mexicans, they start trafficking in the chemicals, then they're
1:28:07
like, you know what, why are we trafficking in the chemicals?
1:28:09
We'll just make it, make everything.
1:28:12
And so and by the so you had the two operations running parallel
1:28:16
over, they had the 30 tons a month with the airplanes and
1:28:18
then they start scaling up. Meth is like a new found, like
1:28:22
that's a new found, right. So, but that's newly found, like
1:28:26
that's not the old school weed, coke, you know, heroin deal.
1:28:30
That's that's, you know, the new Advent.
1:28:32
Yeah, you can. You can scale it up.
1:28:33
You know, they tried persuading some of the guys in my case to
1:28:36
go down to Mexico and set up shops.
1:28:39
And it's like, no, I'm not. Just what's to stop them from
1:28:42
just kidnapping you, forcing you to tell them how to do it?
1:28:44
Just get ready to say that's a good way to get on alive.
1:28:46
Didn't they have a big, you have a large scale manufacturing
1:28:49
place in in Mexico and what's stopping somebody from rolling
1:28:54
up in there and saying this is mine?
1:28:55
Well, no, they're they're they're they're going to provide
1:28:58
the protection everything goes to stop them from kidnapping
1:29:00
you, chaining you in there, teach their people how to do it
1:29:03
and then. And then you're then you're
1:29:04
chopped up in a barrel. Yeah, disposable like so.
1:29:07
No. No and so but.
1:29:09
The when they would make those offers to you and others, would
1:29:12
it be lucrative? Like would they?
1:29:15
Well. Surely, but they 'cause they
1:29:16
were doing it on volume, they're like look, you know, we'll
1:29:19
instead of charging this, the fee was anywhere from 9 to
1:29:23
12,000 for the conversion per pound and they're like, well
1:29:27
we'll pay 2000 a pound but we'll do 1000 lbs at a time, which
1:29:32
would have been big for 959697 naira.
1:29:36
Today they do fourteen, £15,000 at a time.
1:29:38
Oh, really? To finish the crystal.
1:29:41
But back then they wanted to get the capacity to do the
1:29:44
conversion from the powder to the crystal.
1:29:47
And so, but going into the latter part of the 90s, you had
1:29:51
these two operations where Sinaloa had this additional
1:29:56
revenue stream that the other cartels didn't have access to
1:30:00
because they didn't have control of the ports they and they
1:30:05
didn't have the connection with the Chinese.
1:30:07
You got to have the Chinese connection in conjunction with
1:30:09
the port you got. To.
1:30:10
Have access to the port lockdown so that that that that whoever
1:30:13
runs the ports letting that stuff come through and so and
1:30:16
you got to make as. Sinaloa starts building out its
1:30:19
network. It's horizontally growing.
1:30:23
More people are coming into the fold because out in the Gulf you
1:30:26
had it. The development that altered the
1:30:29
course of organized crime because they built what became
1:30:37
the most powerful paramilitary group ever.
1:30:41
And you had the leader of the Gulf, which at the time was an
1:30:42
individual named Osio Cardenas. And he wanted to consolidate
1:30:47
control of this network. Remember, this is the
1:30:51
predecessor group that survived what a lot of this articulated.
1:30:54
The Gulf still remained well. He wanted to take over.
1:30:58
Well, the leaders of the other factions may not necessarily
1:31:01
want to fall in line. And so when prior to him making
1:31:05
his push, he developed a relationship with the member of
1:31:10
the Special Forces in Mexico, an individual named Desina, and he
1:31:15
went to him, he said, hey, look, you know what, I'm trying to put
1:31:16
something together. I want to take over.
1:31:20
Going to be a little bit of a little bit of a challenge.
1:31:24
How can we build something that's more sophisticated than
1:31:28
just thugs with machetes? And so the Cena, who later on
1:31:35
went by the call sign Z1, he recruits 30 of his friends.
1:31:40
These are 30 members of the Mexican Special Forces trained
1:31:44
by American Special. Forces these Zetas.
1:31:46
Zetas yes. Now these guys are the guys that
1:31:48
are responsible for the counter narcotics.
1:31:51
So 30 of them jump ship and they become the nucleus of what
1:31:55
became Los Zetas, which was the paramilitary wing for the Gulf
1:31:59
Cartel. So that thirty Man Group, they
1:32:02
didn't recruit several hundred additional Mexican military
1:32:06
personnel. So now you've got thirty special
1:32:10
forces, 300 military personnel. Then they recruit anywhere from
1:32:15
1200 to 1500 military personnel from Guatemala, from Honduras.
1:32:22
These are trained by Americans. Seventh group Special.
1:32:27
He had 1500 men. That was a paramilitary
1:32:32
structure. Command sub command.
1:32:36
Or just to. Whether it be logistics,
1:32:38
supplies, I mean, they ran it with a military level of
1:32:41
efficiency. And so also Cardinals was able
1:32:45
to consolidate control over the Gulf.
1:32:49
Like nobody could withstand these guys.
1:32:51
They they he built like got two 3000 people.
1:32:54
Got a couple. 1000 Military. Training military.
1:32:58
Yeah, no current military. Defected.
1:33:00
Oh, current military switched. Over switched over.
1:33:03
To the back, to the back guy, so to.
1:33:05
Speak to to the Gulf team so and so.
1:33:08
Now what was interesting is like in 1999 there was an incident
1:33:10
where there were a couple of FBI agents gathering intelligence in
1:33:16
Mexico on Gulf territory. They apprehend them.
1:33:21
Zetas. Is that as vid they call in
1:33:23
Osiel Cardenas, he shows up. They're like, what do you want
1:33:26
us to do with him? And the Americans, of course,
1:33:28
identified themselves as FBI and.
1:33:30
We had that rule. And they reminded us, hey,
1:33:32
remember what happened with Camarena was.
1:33:33
It from 87. This is yes from 8085 unaliving
1:33:37
the 87 rule. Here it is 12 years later.
1:33:40
Osiel Cardenas had no problem unaliving people practice.
1:33:44
Nick Magnum was a Mat Amigos. They called him friend killer.
1:33:48
And so he was. And he'd.
1:33:49
Established this huge network, this huge network of defected
1:33:52
military. Yeah.
1:33:53
And so one would think that he didn't give a fuck.
1:33:55
And get out of here, gringos. Leave my country.
1:33:56
Don't ever come back. And and and but didn't hurt him.
1:33:59
Yeah, of course not. Because it's a code.
1:34:02
It's not in his interest. Too much.
1:34:05
Heat to harm federal agents. So going into late 1990s, you've
1:34:11
got this paramilitary wing coming out of the Gulf and it's
1:34:14
just gobbling up territory now. In 1997, the leader of that
1:34:19
aviation operation, the Lord of the Skies, he's the drug Lord
1:34:22
that passed away during the course of plastic surgery.
1:34:28
Oh, OK. And so now that disrupts what
1:34:31
has. That whole air cargo now is
1:34:32
probably in jeopardy. It's.
1:34:34
It's in jeopardy because he's the one.
1:34:35
He was spending $500 million a year in payments.
1:34:38
Keep mind this is 500 million in 95. $500 million.
1:34:44
So that'd be about $1.2 billion a year just spreading it around
1:34:50
to to allow for that air transport operation.
1:34:53
So he's got 500 million in costs to be able to operate.
1:34:58
That, that, that. That's before he makes.
1:34:59
That's before he pays the pilots.
1:35:01
Right, correct you mean, but he just.
1:35:03
That's right. That's that's.
1:35:04
That's the reason and the generals of the airstrip and all
1:35:07
of that is is 1/2 a billion dollar.
1:35:09
Industry. The guy that was named the the
1:35:14
head of the counter narcotics effort in Mexico.
1:35:17
There's a Mexican general that got assigned to be like
1:35:19
essentially their drug czar. Turns out he was living in one
1:35:22
of the high rises owned by Maracrito of.
1:35:24
Course he was. So then.
1:35:26
So then we Fast forward to O1. So now, so now here comes the
1:35:29
Zetas. Watas's Jeopardy then are
1:35:34
pushing into like Sinaloa had at that point.
1:35:36
I've been operating out of Monterrey.
1:35:38
As that is taken today, they start taking rolling up the
1:35:40
plazas along the Texas border. They're coming into Juarez,
1:35:43
they're coming into Sinaloa. Meanwhile, here comes Tijuana,
1:35:47
they're coming South into Sinaloa.
1:35:49
Sinaloa's like essentially on their last legs going into 2000.
1:35:54
They are literally months away from extinction.
1:35:59
Think we touched on that on the other one as well.
1:36:01
And so and like, you know, what people don't understand is, you
1:36:04
know, because they were, they were so weak, they had to come
1:36:07
together. Like, you know, this.
1:36:10
The conception of these groups in the United States is
1:36:13
fundamentally misconstrued in that they're not predators.
1:36:20
Like we look at them as tigers, not tigers.
1:36:23
They're house cats. They're smart men.
1:36:26
They're. Clever.
1:36:28
But they're not, you know, we in view them as being.
1:36:32
Bad guys, the big bad. Wolves.
1:36:34
But in no, because what they are is when you see collections of
1:36:38
groups coming together to form a structure.
1:36:41
Well, we see that throughout the natural world.
1:36:44
If you look out on the planes of the Serengeti, you have these
1:36:46
herds of gazelles come together, go in the middle of the ocean,
1:36:49
got these huge schools of fish. You got blocks of birds come
1:36:54
together. You know who don't come
1:36:56
together? Lions.
1:36:59
Yeah, they don't. The predators don't come
1:37:01
together, the prey come together.
1:37:04
Right, thank you the. Cartels aren't the predator,
1:37:07
they're the prey. Sinaloa had to form this
1:37:10
structure of all these organizations because on their
1:37:12
own, they're getting gobbled up. You got the Zetas coming this
1:37:16
way. You got Tijuana coming this way.
1:37:18
You got the Mexican government back in these two.
1:37:21
And then then I think you said, I think if I remember right,
1:37:24
like if I've learned. So, Sinaloa, they're on their
1:37:27
last. Leg.
1:37:28
They're on their last leg. And they aligned themselves with
1:37:31
it. Was it pack?
1:37:32
They designed themselves with pond.
1:37:34
Pond They aligned themselves with the political party that
1:37:37
people people didn't give much of a chance to.
1:37:40
And so, as powerful as the Zetas and the Gulf were, or Tijuana
1:37:43
were, they're not more powerful than the Army.
1:37:45
They're not more than the federales.
1:37:47
But the, the Mexican Army or even quite frankly, the
1:37:49
federales, I mean, that's the the structure, the architecture
1:37:53
is what allows them to operate. Otherwise, they were done,
1:37:56
weren't they? Well.
1:37:57
Yeah, Sinaloa would have been wiped.
1:37:58
Out had pre got back into power, not lost the election.
1:38:01
And so now, when Pre won in late 2000, that was the Christmas
1:38:05
miracle. So now in 2001, they now have
1:38:10
Sinaloa convenes a meeting in the Mexican city of Cornevaca.
1:38:15
And it was chaired by Maio Zambada and it was 30 kingpins.
1:38:19
The the beginning of that forty, that 40 to 60 to 70 organization
1:38:23
network, you had that meeting where thirty of these kingpins
1:38:26
came together and said, look, we're going to get crushed by
1:38:29
the Zetas, we're going to get crushed by Tijuana.
1:38:33
We need to form an alliance. And this is what came known as
1:38:36
the Sinaloa Federation. So it went from being a loose
1:38:41
collection of organizations to what was now a organized
1:38:46
horizontal based structure that maximize their profits through
1:38:50
logistics. And and the backing of the
1:38:52
government. And they now had the backing of
1:38:54
the incoming government. Their horse won.
1:38:57
That's so now, of course. So now you had that.
1:39:00
Tijuana's fucked. Well, so they ended some, but
1:39:02
this is when they said, you know what?
1:39:03
We need Guzman. So they break Guzman out of
1:39:07
prison. That's an O1.
1:39:08
This is now early 2001. Guzman So Pond is like we need
1:39:13
Guzman or no? No, the narcos.
1:39:15
The Narcos. Pond's like, hey you guys.
1:39:18
You guys do what you got to. Do you got to do what to do?
1:39:20
So you had so, so now you had. So so Guzman get out of prison
1:39:24
was the narcos that wanted him back in the in the system.
1:39:28
Yeah, because Guzman is was very competent at what he did from a
1:39:33
smuggling perspective. His organization was
1:39:35
extraordinary. 2 He was notoriously vicious.
1:39:43
He was the kind of guy that was doing that head cutting off and.
1:39:46
No, not so much like that. He just, he demanded a high
1:39:48
level of professionalism. Like if you if you were late by
1:39:52
three hours and you couldn't account for the lateness, the
1:39:55
tardiness, you're on a left boom.
1:39:58
Like forget the loss, the load getting lost if you're late at
1:40:02
that. Right, even if you had the.
1:40:04
Load like you better be able to show hey the axle blow.
1:40:07
Up or I got pulled over. Or he said that some guy
1:40:09
rear-ended me, I had to deal with the cops.
1:40:11
Like you have to be able to independently account for the
1:40:16
reason why you're late and you better make sure that beforehand
1:40:18
you had checked the vehicle. You can't be.
1:40:19
We were driving with expired tags on a life.
1:40:23
So Guzman's back. Yeah, so Guzman gets brought
1:40:25
back into this account. So now they formed a Senate Law
1:40:28
Federation because and instrumental this is you had the
1:40:33
Koch. How long was Guzman in for?
1:40:35
From 93 from the Cardinal. That's right.
1:40:37
He took the cardinal hit. He took the cardinal.
1:40:39
He was a he was a target. He's the target.
1:40:41
So he he just did seven years, he gets out now two years after
1:40:45
Guzman gets knocked off, what Obama gets arrested?
1:40:50
The guy that was in the middle of the shooting war because he
1:40:52
happened to be in his Learjet flying home from some wedding
1:40:55
and the plane crashes. Well, he survives the crane
1:40:58
plane crash. So now, of course, when a you
1:41:01
know a Learjet crashes, the authorities come to you know,
1:41:04
they don't know it's a what? Obama's they?
1:41:06
Don't know who they don't know who it is they.
1:41:07
Just see a plane in the middle of a field, here comes the fire
1:41:09
department, here comes the ambulance, here comes the
1:41:11
authorities. Well, he was able to survive the
1:41:14
crash and he got away, but they were able to recover, retrieve
1:41:18
him subsequently thereafter. So now he joins Guzman in
1:41:20
prison. So now these two guys are in
1:41:23
prison living the life of Riley, hookers, partying bands.
1:41:27
Yeah, yeah, yeah, yeah. Like that. 80% of them in the
1:41:30
United States would wish to live as good as these guys did in
1:41:33
prison. And so that's when the other
1:41:36
guys, Zambada, Valencia, the air bridge is taking place.
1:41:39
While these two guys are now locked up, Guzman gets released.
1:41:42
Going into 2001, they formed a Sinaloa federation, but now they
1:41:47
got the backing of the pound, the political party, which at
1:41:50
the time in Mexico, this is perceived as the the
1:41:53
conservatives. These are the law and order
1:41:54
guys, because you're so fucking corrupted.
1:41:58
Sick. But the perception is we've got
1:42:01
a new party. For the first time in seven
1:42:02
decades, they don't have the taint of corruption.
1:42:05
Mexico has turned the leaf. And these are the conservatives,
1:42:08
like the right of center. And so we're going to hold the
1:42:12
bad guys. We're going to hold the bad guys
1:42:14
accountable. Even though traditionally we're
1:42:17
in on it, well then we're always in on it.
1:42:19
And at at the time, we just had a change in administration in
1:42:22
the US with George W Bush taking in.
1:42:24
So you had a Conservative government in the United States?
1:42:27
George W Bush. And a Conservative government in
1:42:29
Mexico with the president Vicente Fox.
1:42:31
And the president from Texas probably had a little bit to do
1:42:33
with it, too. I mean, right.
1:42:35
Well, the George, WI mean being from Texas.
1:42:37
He was. He was familiar.
1:42:39
Familiar with the? Trade he was familiar with,
1:42:41
particularly like golf cartel, like these are the big bad wolf
1:42:45
because at the time they had the Zetas just rolling.
1:42:46
If you got a president from Oregon, he's not going to know
1:42:49
the inner workings of. Yeah, this was an issue that.
1:42:52
This Texas probably is probably arguably one of the big states
1:42:56
of. Of in 22 one or two.
1:42:58
At California and and and Texas, yes.
1:43:01
So George WS, he's our guy. He's yeah, and so he Han.
1:43:04
Pon gets their guy in there. Han Pon gets their guy in there.
1:43:06
They're. Conservative.
1:43:07
We're conservative. That where NAFTA comes into
1:43:09
fest. The Sinaloa that happened in 94,
1:43:11
OK. And well, just so the audience
1:43:13
knows, NAFTA was the other event that really helps Sinaloa
1:43:19
because for them being as far away from the border as it was
1:43:23
by allowing the integration of the American and Mexican
1:43:26
economies allow for the free flow traffic coming across the
1:43:29
border. So now they were able to say,
1:43:31
well, we're going to load up our Jalapenos de Michoacan and just
1:43:34
send them in trucks. And we got a new, new, new
1:43:37
treaty that's encouraging. Encouraging this is where you
1:43:39
get the 15 to 18,000 tractor trailers coming across the day.
1:43:42
So now it allowed for Sinaloa to be able to use the air bridge to
1:43:46
get the product in New Mexico and then use the NAFTA
1:43:50
incentivize increase in trade to smuggle the product across the
1:43:55
border. And then on the American side to
1:43:58
gain market share, they had two developments where they went to
1:44:00
the regional distribution hub model, Regional distribution hub
1:44:03
model. The red circles represents
1:44:05
Sinaloa. So you see, they're in Los
1:44:06
Angeles, they're in Atlanta, NY, Chicago, and then the Hub in
1:44:10
Charlotte. In Atlanta.
1:44:12
Yeah, Charlotte, Atlanta. For the red, so we got LA,
1:44:15
Chicago, New York, Charlotte, Atlanta.
1:44:17
Yes. Now in my area, the regional
1:44:19
hub, the distribution hub for the Carolina operation was in
1:44:23
Raleigh. It moves between the two cities.
1:44:25
Raleigh and Charlie. Now the logistical hub is
1:44:27
actually right outside of Fort Bragg, so important the product
1:44:31
goes to. That close to U.S. officials.
1:44:34
Because it's Fort Bragg is centrally located right off the
1:44:37
95 freeway. Yes.
1:44:38
And so then you've got it's a, it's an artery to go North and
1:44:41
South because they used to send it to that area, then unload it
1:44:45
and then shoot it up in New York when.
1:44:46
They would now when we talk about it, we talking about
1:44:48
cocaine, hot methamphetamine stuff for the colony.
1:44:51
So when the club? No, no, just back in the 90s,
1:44:53
they said. When did Finney officially get
1:44:55
it it? Became an issue in the United
1:44:57
States. 10s thousand 10,015 Now it started.
1:45:02
Becoming an issue in 2012, 1314, you know, the the American
1:45:09
Pharmaceutical industry created the largest number of addicts in
1:45:16
the history of the US, like they've made more addicts than
1:45:18
out of fentanyl out of the oxys they were prescribing.
1:45:24
The during the pill mill craze during.
1:45:26
The pill mill craze and during 1996 I.
1:45:27
Just watched a documentary on oxy Oxy.
1:45:32
Was it oxycontin? They had them 10204080 You know
1:45:36
what I what it the. Different milligrams and so,
1:45:38
right, different with the words because the algorithm so yeah,
1:45:40
so. Yes, the but in 1996 it showed
1:45:43
the family, the Sackler family, the Sackler family and how
1:45:47
basically they have to this day never been held accountable or
1:45:52
the paid, they paid a lot of money.
1:45:54
Billions and settlements, yes. So from 1996 to 2010 you had a
1:45:58
15 year period where? Just a pill.
1:46:00
Just. Absolutely handing out.
1:46:01
Handing them out like Pez candy. So it created an enormous
1:46:04
millions of people that developed a dependency.
1:46:07
Well, when the DEA said hey, we need to get this under control
1:46:10
and they started targeting. Pill mills.
1:46:12
Pill mills or the doctors that were overly prescribing Now you
1:46:15
had an enormous market demand that wasn't being satisfied.
1:46:20
And so you had Sinaloa had the incent, had the advantage
1:46:26
because they had the poppies, remember from our previous
1:46:28
episode with the with the Yep, cultivation in the Sinaloa
1:46:31
Mountains. So they were able to.
1:46:32
They had the opiate. They were able to substitute
1:46:35
from like, say 2010 to 2013, the, we'll say at one time,
1:46:41
heroin in lieu of the synthetics that were being produced by the
1:46:45
American Pharmaceutical industry.
1:46:46
The problem with that is most people aren't the people that
1:46:50
were doing the Oxys. Like I had an aunt that was in a
1:46:53
car accident. She ended up depend developing a
1:46:55
dependency because she had two knee surgeries.
1:46:58
Well, you know, she's a college professor and never been drunk
1:47:01
in her life. Didn't drink.
1:47:02
Oh yeah. People were surprised on the
1:47:04
affluent, the affluent people that became hooked on these
1:47:07
things, not degenerate people that are on Skid Row.
1:47:10
These are these are legitimate people that had an injury and
1:47:14
the doctors overly. Prescribed these pains, as long
1:47:17
as they remained on it, they can function.
1:47:19
And then. So what happens is and.
1:47:21
So when the when the demand was not able to be satisfied because
1:47:25
these the professionals aren't going to go to some seedy back
1:47:29
alley to buy H. To an opiate Dan.
1:47:32
Right back to the so then that's when the Chinese organized
1:47:35
crying saw, hey, we have a market, a demand that isn't
1:47:39
being satisfied, a big huge demand, and they had access to
1:47:45
the precursors. So from let's say 141516171819
1:47:50
this was a Chinese organized crime problem and nothing to do
1:47:54
with the Mexicans really. No.
1:47:56
At this point, it's primarily Chinese organized crime now.
1:48:01
Right around 1516, you had the first of the cartels, which is
1:48:05
Jalisco. We haven't gotten to that part
1:48:06
yet, but they they're the ones who got involved first.
1:48:10
But you know, the pressure the American government put on China
1:48:12
in 19, where they started restricting the precursors that
1:48:16
were used to produce the fenny, They said, OK, well, then we'll
1:48:19
just ship the chemicals, the precursors.
1:48:21
Precursors. So what's what's?
1:48:24
The Then they started shipping out to Mexico.
1:48:26
That's when Mexico. From 2019 on, it's been a
1:48:28
Mexican. Problem.
1:48:29
So is Fenny just used as a cutting agent to extend whatever
1:48:34
they're making more of when the OR is it actually a stand alone?
1:48:39
It's a stand alone opiate that has medicinal purposes since the
1:48:44
1960s, but it is so potent. What they'll do is they'll take,
1:48:49
I don't know, however many milligrams it is per dope, but
1:48:51
they'll take, you know, let's say 5 milligrams of Fenny or 3
1:48:54
milligrams of Fenny and produce a counterfeit 40 milligram oxy.
1:49:00
With that, Fenny. With the fenny, so they're like,
1:49:02
they're not the. Is the fenny cheap?
1:49:06
Yeah, of course. It's just dirt cheap dirt.
1:49:08
Cheap $3000 worth of those expose by Reuters were you know
1:49:12
you got guys in Mexico spending $3500 on the chemicals cause the
1:49:14
chemicals aren't illegal. The precursors.
1:49:17
It's the precursors. Precursors, they just keep going
1:49:19
back. Reverse engineering it.
1:49:22
And so if you just go to so $3500 investment will bring you
1:49:24
$600,000 worth of. Product hold on 3500 will bring
1:49:28
you 600. $1000 it it fundamentally changed the drug
1:49:32
trade in Mexico. That's why you got 450
1:49:34
organizations. Only 70 of them are within the
1:49:37
two big networks. The overwhelming majority of
1:49:39
them are operating outside of the cartel structure.
1:49:41
Because now what do you need a cartel for?
1:49:43
Cartel is only for economies of scale.
1:49:47
If you can get the chemicals from 3500 bucks apiece, you're
1:49:50
not going to cut these guys in. Fuck it, I'll just take it to
1:49:51
Albuquerque. Make 600. 1000 Do it myself,
1:49:54
right? And so that's why you saw a
1:49:58
change in the economics. But going back to the 2001
1:50:02
period, you had the Guanaevaca conference.
1:50:05
They decide, you know what, this 30 organization networks is
1:50:08
going to form the Sinaloa Federation and we're going to
1:50:11
protect us because they're to prey.
1:50:13
We're going to form this consortium to defend ourselves.
1:50:17
Independent of that, they start relying on their allies in the
1:50:22
Mexican government. So the pan political party takes
1:50:25
over the presidency and in the course of the 1st 15 months
1:50:28
between let's say January of O1 to March of 2002, they arrest
1:50:31
1800 traffickers in Tijuana. Mexican government.
1:50:35
Mexican government, they don't need to.
1:50:36
Start. Why?
1:50:37
Because the Tijuana cartel was backing the rival political
1:50:41
party pre correct. They're not targeting their
1:50:43
narcos, they're targeting the rival cartel because they
1:50:46
support the rival party. I get it.
1:50:48
So now PAN unleashes their military and their federal law
1:50:52
enforcement establishment to take out Tijuana so Sinaloa can
1:50:56
gain all that market share. The Bush administration is
1:50:58
praising the Fox administration of Mexico.
1:51:01
We have a partner in the war on drugs.
1:51:03
No, we're just picking the different guys.
1:51:05
They're just of course they're they're making sure that they're
1:51:07
narcos are winning because if Sinaloa when the Sinaloa gains
1:51:12
market share, the structured payments that go to pond
1:51:15
increase. So the Mexican government, the
1:51:19
political classes incentivize to shift.
1:51:22
Let's elevate these guys so Tijuana over the course of the
1:51:24
next 15 months lose 1800 operators.
1:51:27
In the spring of O2, the leader of the Tijuana cartel, Benjamin
1:51:33
Ariano, he gets knocked off and this is the second phase because
1:51:37
Zambada works with his alliance within the Mexican pond.
1:51:42
They go at the Tijuana Independent of that, Zambada has
1:51:45
Guzman contact his lawyer. See, they had a lawyer in San
1:51:50
Diego named Humberto. Lawyer, attorney, lawyer
1:51:55
contacts the American government and says, hey, I have actionable
1:51:58
Intel for you. Remember, it's time.
1:52:00
Tijuana is the big cartel. They've been the top dog for the
1:52:03
entire decade of the 90s. We have information where you
1:52:07
guys can find Benjamin Nariano because Sinaloa's got big bribes
1:52:11
out. We want Intel.
1:52:13
So if you happen to be, if you, if your sister happens to be the
1:52:17
mistress of Benjamin Nariano. I got money for that Intel.
1:52:21
How many millions do you need? That type of money.
1:52:25
So they start putting out networks of intelligence
1:52:29
gathering. They they discover, well, hey,
1:52:32
on Tuesday afternoon, Ariano's side piece is this smoking hot
1:52:36
stripper that lives over here. He comes and sees her on
1:52:39
Tuesdays and Thursdays. Always leaves it to the smoking
1:52:44
hot stripper, so then it always goes back.
1:52:46
To the mistresses. It always goes back to the
1:52:48
smoking hot. Mistress is always the from the.
1:52:51
From the poor girl got her head cut off in in Venezuela to the.
1:52:53
That was the wife. That was what?
1:52:54
Upon the wife. Yeah, but this is I'm.
1:52:56
Sure she was attractive though, I'm sure.
1:52:57
She was, yeah. The side piece, the.
1:52:59
Side piece. She's in play.
1:53:01
I'm sure she's I'm sure she's smoking hot.
1:53:02
Yeah. And so that information gets the
1:53:06
Zamata's hands. Lamada gives that information to
1:53:08
Guzman. Guzman gives that information to
1:53:10
the American lawyer. The American lawyer feeds that
1:53:12
information to the DEA. The DEA feeds that information
1:53:15
to their lackeys in PAN, not knowing that Pan's incentivized
1:53:18
already. Yeah, they go and they knock off
1:53:20
the head. But it's the Iwana cartel.
1:53:22
So in a 15 month period, 1800 of their operatives plus the leader
1:53:28
all get knocked off a month later.
1:53:30
Unalived. No, he gets arrested.
1:53:32
OK. A month later, the number 2,
1:53:34
Ramon Ariano, he gets unalived by Mexican authorities.
1:53:40
They said, oh, he was resisting arrest.
1:53:42
So their cartels in shambles. Tijuana's in shambles now in
1:53:46
2002, who's able to come in? Sinaloa.
1:53:49
Sinaloa. So that guy that was the number
1:53:51
one in Los Angeles during my era, individual named Hermano
1:53:54
Levitis. And by the time 2002 rolls
1:53:57
around, he's now works his way up.
1:53:59
He's advanced, and so now he gets assigned responsibility for
1:54:04
the Tijuana Plaza. Which is huge.
1:54:06
Which is huge. Huge.
1:54:09
When Kerry's flying to Florida, the the California, San Diego,
1:54:13
he's meeting with Vermont's people.
1:54:17
And so now Olivettis now of course they come in with their
1:54:21
their sicario. So like them this way.
1:54:24
In the traditional lore, Sinaloa defeated Tijuana militarily.
1:54:32
Most of it was done by the Mexican government.
1:54:34
The decapitation strikes were done by the American government.
1:54:38
And for Sinaloa, it was just a mop up operation.
1:54:41
So by 2003, Sinaloa now has control, ostensibly majority
1:54:48
control of the Tijuana Plaza. Now remember, Sinaloa operates
1:54:53
under a different model. They don't want to exert
1:54:57
personal control over the territory.
1:54:59
It's too much of a headache. They contract with local groups.
1:55:03
So now Armando Levetis comes there and he overseas the
1:55:07
network of the smuggling operations.
1:55:09
So you got like a seven man team that handles the tunnel
1:55:12
operation, A10 man team that handles the tunnel diggling,
1:55:15
digging. You've got a 10 man team that
1:55:19
handles overland airportation operation with the tractor
1:55:21
trailers. You know, a 15 man team with the
1:55:24
private civilian vehicles. You've seen a little might have
1:55:26
25 guys, 30 guys in Tijuana. That's it.
1:55:31
That's it. Getting all of that here.
1:55:34
Now they have a contract with local groups, but those guys
1:55:37
aren't seen a level sacrifice. Every man in Tijuana and the
1:55:42
guys that they sent to that area, those are lower level
1:55:46
guys. Those are those.
1:55:47
Are two and threes. Yeah, that's those are the the E
1:55:49
fives in the you know, like the master Sergeant is the Romano
1:55:52
Levitis was the master Sergeant. He was an E8 E 9.
1:55:57
Now he will report to Zambada's son, who might be like an O5,
1:56:02
but he's in Guadalajara. The officers aren't going to the
1:56:05
frontline. No, no.
1:56:08
And so you had Sinaloa come in by 2003, establish ostensible
1:56:13
control over the Plaza in Tijuana.
1:56:16
Meanwhile, the Mexican government now turns its sights
1:56:19
on the Gulf because the Gulf is also backing the rival political
1:56:23
party. And Bush.
1:56:25
This goes back to your observation.
1:56:26
He's telling the Mexican government, those guys in they
1:56:29
bring a lot of product into Texas.
1:56:30
Get them, they're a bad ombre. That's the Gulf.
1:56:32
That's the Gulf region. That's the Gulf region, a boom.
1:56:35
Busted. Information that's developed by
1:56:38
Zambada through his network of intelligence.
1:56:41
They get that information, feed it to the Lord in San Diego, the
1:56:45
San Diego lawyer feeds it to the DEADEA, feeds it to the lackeys
1:56:48
in Mexico. They go knock off some OSIO
1:56:51
Cardinals, the head of the Gulf Cartel.
1:56:53
The head. The head decompitation strike.
1:56:55
Now he's sitting in custody. In America.
1:57:00
No, no, there's no one holding them in Mexico.
1:57:02
They end up getting sent here five years later.
1:57:05
It's the big event when they get sent.
1:57:07
Initially, they're just being held in Mexico.
1:57:09
So the head of the Tijuana Cartel in jail, the head of the
1:57:12
Gulf Cartel in jail, massive military pressure from the
1:57:16
medics in law enforcement and federally, you know, the
1:57:19
military to destabilize these networks so that Sinaloa can
1:57:22
come up. And Sinaloa was on their last
1:57:26
leg until until until Pond got in. 2000, looking at their last
1:57:30
legs, then by 2004, you're the biggest network on the Western
1:57:33
Hemisphere. They're ascending.
1:57:36
So when people say, well, the Sinaloa cartel, you're taught.
1:57:39
Most Americans think 2005, 2006, 2007.
1:57:42
That's peak. That's before that it was
1:57:44
getting. It was getting built way before.
1:57:45
Yeah, but that that's where you saw the number of organizations
1:57:48
expand. When did pond?
1:57:49
When did pond win? What year did?
1:57:51
They went from 2000 to 2012. That 12 year run was Sinaloa's.
1:57:54
Pinnacle, OH, by far. And then the next guy won three
1:57:58
and he's the one who said they need 200 million off the top and
1:58:00
we'll keep it going. That's it.
1:58:01
Now that's. 2012 to 2018. Right, 2012, 2018.
1:58:06
But they had an 18 year run, 12 with their natural allies and
1:58:09
pond, and then an additional 6 because they paid a couple 100
1:58:14
mil and they had to continue with the structure payments.
1:58:16
Now who's in charge now? Morena.
1:58:18
Is that pond or pre? That's a separate political
1:58:20
party entirely. Oh, so this is the third, This
1:58:22
is the third guy you talked about the third party that we
1:58:25
haven't spoke of yet, not Pond or Pre not.
1:58:27
Pond or pre so they. So they put another one in,
1:58:30
which is very uncommon to have three.
1:58:32
They're supported by the Zambada faction of what was previously
1:58:37
the Sinaloa network. So it's just like it's just
1:58:40
almost rebrand a Sina Loma rebrand.
1:58:42
That's what it does. In fact, essentially it is a
1:58:44
Sinaloa rebrand and so once once Osio card is gets taken out, now
1:58:49
you enter into what's the golden era 2004, 567 up until 2008.
1:58:55
And what's 20 to 30 billion annually is?
1:58:58
What is my notes 20 to 30 billion annually?
1:59:02
Because at this point, it coincided with, you know, one of
1:59:04
the 30 guys that formed out of Pundit Alliance was a drug Lord
1:59:08
named Nacho Colonel. And this is O.
1:59:10
Three to O eight. Yeah, this is the golden.
1:59:13
But that 30 now, again, just because we got pond in there
1:59:16
doesn't mean the government's not.
1:59:18
Oh no, that doesn't change. That doesn't remember because
1:59:20
they're dealing with Zambada. They're.
1:59:23
Dealing with one person. They're dealing with one person,
1:59:25
Zambada deals with the other 30 at that conference.
1:59:28
Zambada is a very powerful man. Because he's.
1:59:31
Is he one of the most powerful ever?
1:59:32
Yeah, well, because he was older, more measured, not a hot
1:59:37
head. Brokered.
1:59:38
You know, like it's, it's the the Mexican president who's 65,
1:59:43
seven years old is not dealing with the 33 year old hot head
1:59:45
like this notion. That's why Guzman was put out
1:59:48
front. Because he was a little bit
1:59:50
younger, a little rough around. The edges and he didn't have
1:59:53
the, you know. And he kind of had the boogeyman
1:59:55
look a little bit. He played into it like he wasn't
1:59:59
sophisticated enough to realize that you're being propped up to
2:00:04
eventually take a fall. So let's Fast forward to the
2:00:07
Golden era. When you get the the key is when
2:00:10
natural cordon L became part of that.
2:00:12
I mean, some people, I mean at 20 and 30 million a year for the
2:00:15
golden era between, you know, O3 and O8, they made a lot of
2:00:19
people a lot of money, right? I mean they're, I mean the.
2:00:21
Political class in Mexico profited No one has profited
2:00:25
more from the drug trade in the past 50 years than the political
2:00:29
elite in Mexico. And got away with it and well, I
2:00:33
mean like. Up until recently, that's why it
2:00:34
was a shock last year when Trump came out and said there was an
2:00:37
intolerable alliance between the Mexican government and the drug
2:00:39
cartels. Well, yeah, of course.
2:00:41
I mean, it's true. But it's not nothing new.
2:00:43
It's been 50 fucking years. I mean, yeah, it's been around
2:00:45
since the 20s. No, since the this the the
2:00:48
system of criminal governance was the 1970s.
2:00:50
Was it the 70s that we had spoke about?
2:00:53
There was a era between was it 20 and 70?
2:00:56
That 50 year era that. It's in 70s when when Priest
2:00:59
said, hey, we want to cut. So they brought in the DFS and
2:01:02
they consolidate everything in Guadalajara.
2:01:04
That's with that's the the era of structured cartels created by
2:01:09
the Mexican government. So now in O1 when Nacho Coronel
2:01:12
came in, he's important because he had control of Jalisco.
2:01:16
Jalisco, of course, has Guadalajara.
2:01:18
And Guadalajara is the not only the heart and soul of Mexico,
2:01:23
but it's also like their tech hub.
2:01:25
I think they're silicon. Silicon Valley.
2:01:28
And so he ends up partnering with Armando Valencia, the guy
2:01:32
from the air bridge, because nowadays, you know what, we're
2:01:35
going to mass scale up the production of the synthetics,
2:01:39
the meth. Well, that was done primarily in
2:01:42
Guadalajara. Well, that air territory was
2:01:44
controlled by natural Coronel. So now Coronel's organization
2:01:49
becomes enormously influential because he's the guy that had
2:01:52
the maritime operation with the tuna boats where they send the
2:01:55
boats out to the ocean, rendezvous with the narco Subs,
2:01:57
take possession of the loads or take possession of the loads
2:01:59
from the mother ships and then return them to shore under the
2:02:02
guys are returning home with the catch.
2:02:04
So he's bringing. In we got tuna.
2:02:06
Yeah, you got the. We got tuna, but.
2:02:08
Yeah, you got the maritime operation with the tuna boats
2:02:11
bringing in 10/15/20 tons at a time per month.
2:02:14
Then you had the overland importation operation coming
2:02:18
right up to the Central America landmass.
2:02:20
Then you had the maritime operation coming up through the
2:02:22
Gulf. So at this point seen a little
2:02:23
hitting on all cylinders. And do they have the air cargo
2:02:25
gimmick still? They had no, because that got
2:02:27
shut down because the generals got knocked off.
2:02:30
So what they did is they pivoted and they compromised the
2:02:33
officials at the International Airport in Mexico City.
2:02:37
And fortunately for them, this is when Venezuela flipped, so
2:02:42
they were able to arrange they have the planes loaded.
2:02:44
This is where Venezuela actually gets involved with the drug
2:02:46
trade, not what the administration characterizes.
2:02:49
Not what we've seen. But it is.
2:02:51
But yeah, but they were instrumental in that the product
2:02:55
can go from Colombia to Venezuela, get loaded into the
2:02:57
bellies of the commercial airliners and then fly them into
2:03:00
the Mexican International Airport in DFA in Mexico City,
2:03:03
and they just unload the planes. It's baggage handlers taking the
2:03:06
planes up. Yes.
2:03:06
And so you're going to declare it right through customs?
2:03:08
And and governments behind it at the largest scale.
2:03:12
Yes. And so the Valencias had control
2:03:14
of the International Airport in Mexico City.
2:03:19
Independent of that, you had the aviation with private civilian
2:03:22
vehicle, private civilian planes like Leers, King Airs, they're
2:03:26
flying into Acapulco. Those are shorter runs.
2:03:30
So you get the Acapulco airport compromise for the smaller King
2:03:33
Air loads. You got the commercial airliners
2:03:35
coming into Mexico City. You got the maritime operations
2:03:38
with the tuna boats on the Pacific and the narco Subs.
2:03:41
And you got the dry the the the. Overland operation coming right
2:03:44
up through the land mass. Panama, Costa Rica.
2:03:47
Mean you're hitting them 556. You're Nicaragua, Honduras,
2:03:50
Guatemala, Mexico, Panama all the way through, and then you
2:03:54
got the maritime operation on the Gulf just hitting them on
2:03:56
all cylinders at this point. And protect it.
2:03:59
And but Ben Pond is there ensuring it all.
2:04:04
And so they destabilize the Gulf.
2:04:06
They destabilize the Tijuana. Now Sinaloa takes control of
2:04:10
Tijuana. They were never able to take
2:04:13
control of the Gulf because even though they took out Osio
2:04:17
Cardinas, you still have the Zetas.
2:04:20
The leftover Zetas. Zetas they didn't get taken.
2:04:23
Out they were 3000 deep at one time.
2:04:25
They're 15102 thousand guys deep.
2:04:28
And they're working for the Gulf.
2:04:29
They're working for the Gulf now, where things began to get
2:04:32
destabilized for them is shortly after his arrest, Osio Cardinals
2:04:36
starts cooperating. And so he starts cooperating
2:04:40
with the American authorities and he starts giving up
2:04:44
information that was actionable in that, you know, give here the
2:04:49
coordinates. And there's a tractor trailer
2:04:51
buried out in the middle of the desert at these coordinates and
2:04:53
it's filled with cash. But the authorities are like
2:04:56
taking these massive. Finds.
2:05:00
Finds that ultimately led the Zetas to conclude, you know
2:05:04
what? He's cooperating.
2:05:07
Zetas go to war with the Gulf. Oh, so they go to, they go to
2:05:12
war with who's and who there's. Previous sponsors, They're
2:05:14
benefactors. Right.
2:05:16
That's why for the next 10 years all you kept hearing about here
2:05:19
in the US was the Zetas, Zetas, Zetas because they became the
2:05:21
bad guy. Like, they were not they, they
2:05:25
had local affiliations with the authorities because, you know,
2:05:28
greedy City Councilman, greedy police chiefs.
2:05:31
But at the federal level, they were always the bad guys.
2:05:35
That's why you get so much attention on them.
2:05:37
They were localized but not federalized.
2:05:39
That's right. That's right.
2:05:40
And so, you know, the Sinaloa practice of using law
2:05:47
enforcement to achieve their ends has been cemented for
2:05:50
decades, which is why when they come to the US, they'll
2:05:54
cooperate. Well, that's fundamentally
2:05:56
almost the way you have to do it.
2:05:57
Yeah, just across the board. You got to have some insight you
2:06:01
have. You have to have some
2:06:03
cooperation with somebody of power that can help you
2:06:07
expedite. That's who's got.
2:06:08
That's how you get control of this Plaza.
2:06:11
Like the guy in Tijuana, his job is to collect the taxes.
2:06:16
We think he's running the drug trade.
2:06:17
No, the government's like, you got the Plaza.
2:06:19
OK, Zambada, who's your guy there?
2:06:21
Olivatis. Olivatis, you're responsible.
2:06:24
Well, he has to account to them. This is the.
2:06:26
Government. Here's your cut.
2:06:29
So now in addition to being the the the the problem with Guzman
2:06:35
is he was fundamentally just a greedy POS.
2:06:40
Guzman. Because by 2003, they had been
2:06:45
able to destabilize Tijuana, take over that Plaza, really
2:06:50
undermined the Gulf, or at least they neutralized the threat.
2:06:52
They didn't take over. And got in fighting within the.
2:06:55
Gulf and now they're in fighting within the gulf.
2:06:57
So now that thirty group comp. So then meanwhile Valencia is
2:07:01
partnering with Cornell with the massive upscale in the crystal.
2:07:07
Before there was the raw meth coming out of Colima.
2:07:10
Now they're just mass producing the crystal.
2:07:11
Making it Making it. Guzman sees this and says, wow,
2:07:15
these guys are hitting it all. All cylinders.
2:07:19
Maybe Valencia needs to go away. So he tips off the they tip off
2:07:24
the authorities and Valencia gets he's at a bar having drinks
2:07:28
with his buddies. His authorities just go and they
2:07:31
arrest him. Later on when I saw Armando in
2:07:33
prison, like what happened, he just came and got me.
2:07:36
Miss hanging out he. Ain't got a little cantina
2:07:39
having drinks with his buddies. Mixing another the boys are.
2:07:41
There, the boys show up. And probably lots of them.
2:07:44
So then the mother was so so Valencia gets removed from the
2:07:50
equation. He was natural Cordonel's
2:07:52
partner who becomes Cordonel's new partner.
2:07:56
Who's mine? Who's mine?
2:07:57
I just. Figured it out.
2:08:01
So and so so. That's in O3 a year later.
2:08:04
Remember, they had formed the alliance with the guys in Juarez
2:08:06
and Sinaloa because they were being pressured by the Gulf and
2:08:10
by Tijuana. Well, once these situations were
2:08:12
stabilized, the guy that was in charge of Juarez had previously
2:08:17
had him dated derangement with Zambada and the guy they formed
2:08:19
part of the Sina Law Federation. Whoa, whose mom decides?
2:08:23
You know what? Maybe we want that Plaza too.
2:08:26
Agreed. So he makes a move against
2:08:29
Vicente. Now they don't get Vicente, but
2:08:33
they unalive his brother. Is it not?
2:08:37
That's kind of not cool. It's all at war.
2:08:39
Well, it's kind of like against the code a little bit, isn't it?
2:08:42
That's why the the code is not harming American law
2:08:48
enforcement. But they always kind of self
2:08:50
police themselves as well. But I wouldn't once.
2:08:52
See, the problem is, is once the Adrianos did the thing with
2:08:57
what, Obama's wife, Yeah, that said OK, because they Adrianos
2:09:01
used unaliving as a tool. That was their first move, not
2:09:05
the last resort. And so that introduced a level
2:09:09
of violence, violence that previously didn't exist.
2:09:13
And so when Guzman's people made a move against Carrizo, now it's
2:09:20
it's a problem because what is, is the second most important
2:09:25
port of entry? Like they actually have a bigger
2:09:28
commercial port in Tijuana. So geographically,
2:09:32
Geographically. Very, very it's.
2:09:33
Right across from El Paso. And Guzman wants it.
2:09:37
Yeah, the Sinaloa guys wanted it.
2:09:39
And Guzman, you know, and the number 2 for the Carrizos was a
2:09:41
guy named Espartagoza and Spatagosa's organization,
2:09:45
they're the ones that had the regional hub in New York.
2:09:48
And you know, Spatagosa was was a legendary trafficker in
2:09:51
Mexico. And he's the guy that went by
2:09:54
the handle blew. And Spatagosa when the the drug
2:10:01
Lord who was having the plastic surgery unalived, you know, was
2:10:05
passed away during the procedure, everyone thought that
2:10:10
Spatagosa would have taken over that Plaza.
2:10:12
Instead it went to the unalived facial surgery guy's brother.
2:10:19
And so it was like, you know, only because Hispanic goes that
2:10:23
handled the trade. Vicente a lot of kidding to his
2:10:28
brother. He handled the payouts.
2:10:32
And so like when if you're a massive drug Lord and you're
2:10:35
spending 500 million a year in 1996 dollars, 1.31 point 4
2:10:39
billion a year and you're spreading that money around,
2:10:41
well who can people trust to interact with your brother?
2:10:45
Like I'll send my brother, you send your sister, or you send
2:10:50
your fuck 'cause they know you're not going to.
2:10:51
It's a family direct blood tie. And at at a very large volume,
2:10:57
yes, $500 million. So although it's part of goes
2:10:59
that handled much of the trade, the drug trade, the guy who had
2:11:04
to contact with the senators, the governors, the the political
2:11:07
class was Vicente. And so he essentially took over.
2:11:13
And once the Federation was able to work the advancement of the
2:11:18
Gulf, undermine Tijuana, Sinaloa turned their sights on Juarez.
2:11:24
And of course, Guzman being the POS that he was, double crosses
2:11:27
Valencia in O3 and he double crosses Carrillo in O4 triggers
2:11:32
a massive war. This goes on for the next 4
2:11:35
years and in 2008, Wattis was the unaliven capital of the
2:11:39
world. It's worse than Fallujah.
2:11:41
It was this all out war at that point now.
2:11:45
So you've got this event taking place in O4 where Gulf is
2:11:50
neutralized, Wattis is on fire, Tijuana is subdued, Sinaloa was
2:11:57
at its peak at this point, Golden era O3O4.
2:12:00
O5O. Six O 7.
2:12:02
It's just they're hitting on all cylinders.
2:12:04
The golden era, the golden era, they're making money hand over
2:12:06
fucking fist. You know, this is the the second
2:12:09
largest operation in the history of the drug trade.
2:12:13
In the world. The second, yeah, in the world,
2:12:15
second largest in the world. The largest was a group out of
2:12:17
China, but this one in the Western Hemisphere.
2:12:21
No one ever saw what Sinaloa Federation was at that point.
2:12:24
So in O 6, here comes the next president.
2:12:28
I believe they called it on. What?
2:12:30
What party? On, on, on wins again, because
2:12:33
they got Sinaloa, they're bankroll under the leg.
2:12:35
You got all the money now. So Pond wins and Calderon comes
2:12:41
in late 2006 and right wing hard nosed law enforcement.
2:12:49
We're going to stick it to these narcos because there's a lot of
2:12:53
fighting going on it between the Gulf and the Zetas.
2:12:55
There's a lot of fighting going on in Juarez, like it's in the
2:12:57
news. And so and the guys fighting
2:13:02
aren't Sinaloa. So of course he's going to come
2:13:05
and get hard on the rival cartels.
2:13:09
So Calderon comes into office and he assigns as his his
2:13:14
equivalent of the FBI director was the guy Hinata Luna.
2:13:17
So the Secretary of Defense in that administration, he's on the
2:13:23
take the Mexican equivalent of the FBI director.
2:13:26
He's on the take the Mexican equivalent of the DEA chief.
2:13:29
He's going to think this guy's getting 50 million, this guy's
2:13:31
getting 60 million, this guy's getting 30 million.
2:13:33
You got 270 million on four cabinet level officials, 450
2:13:36
million on 11 high-ranking federal law enforcement
2:13:40
officials. I mean like and keep in mind
2:13:43
it's not seen a lot of bribing. It's just doing business.
2:13:47
This is the structured payments. This is what goes to you guys
2:13:51
like here in the United States. It characterizes it as if the
2:13:53
bad narcos are corrupting the Mexican government officials.
2:13:57
No, the Mexican government officials are taking theirs off
2:13:59
the top. And if you were running that
2:14:00
Plaza and you come up short, you get replaced.
2:14:05
There's an incentive to. You have to make sure that you
2:14:07
survive your audit because if that general starts thinking,
2:14:11
hey, you're coming in light maybe one month, maybe two
2:14:14
months, at month three, he's busted you, you're coming to
2:14:17
you. Nobody can withstand the Army.
2:14:22
Better not be light. And so-called it on.
2:14:25
Takes office late 2006 and they put together a plan.
2:14:31
This is pond. Pond, They dispatch high-ranking
2:14:35
officials to DC Secretary of Defense, Mexican Secretary of
2:14:39
Defense, Mexican FBI director. They come to DC and they meet
2:14:43
with high-ranking officials in the Bush administration,
2:14:46
Attorney General, my old prosecutor Robert Mueller, FBI
2:14:49
director. All these bigwigs are meeting
2:14:51
with these high-ranking Mexican officials.
2:14:52
They put together a plan and say, you know what, gringos?
2:14:54
We got an idea. We're going to start crushing
2:14:58
these cartels, but we need your help.
2:15:01
We need financial support. We're going to need material
2:15:04
support and we're going to need your assistance supplying
2:15:07
intelligence. We'll be the boots on the
2:15:08
ground. But we need Intel.
2:15:10
We're. Going to need Intel money
2:15:13
material Bush administration is like.
2:15:17
Great, where do we sign? Out put together a proposal so
2:15:21
now the high-ranking Mexican officials return back to Mexico
2:15:28
you know and out of Luna reaches out to his contact.
2:15:30
You're not going to believe this.
2:15:31
The gringos are going to give us money and weapons and
2:15:34
intelligence to go attack your enemies.
2:15:37
Go attack your your adversaries. What do you guys want us to go
2:15:39
get? I got to get them guys in mutual
2:15:40
kind. Gringos are paying for
2:15:42
everything. Doing The Dirty work, yeah.
2:15:45
So here comes the operation. We couldn't.
2:15:47
Get any better? I mean, they couldn't, they
2:15:48
couldn't have written him any. Better OK, it was 5 military
2:15:51
campaigns in a four year period. The Mexican government mobilized
2:15:54
65,000 soldiers. The American government spent
2:15:58
over $4 billion on five military.
2:16:02
Campaigns collectively enforce. They go into Operation Mitro Con
2:16:09
to go get La Familia Mitro Con, another cartel.
2:16:11
Then they go into Operation Baja California Babo.
2:16:14
Then they go Operation Waters Babo Boom.
2:16:17
Then they go into Tamil Evas twice, once for the Zetas, one
2:16:19
for the for the golf. They're just the guys that see
2:16:23
the horse and they're laughing their fucking asses like you
2:16:25
can. Every time one of these
2:16:27
operations conclude, they come back to DC and you know, there's
2:16:30
George W Bush praising him. There's Barack Obama praising
2:16:33
everyone between the two administrations and out of Luna.
2:16:36
He's brave, courageous. We finally have a true partner
2:16:39
in the war on drugs. The guy's making 50 million a
2:16:41
year. He keeps coming to you guys with
2:16:44
another plan. Hey, if you give us X number
2:16:46
hundreds of millions of dollars. We'll go even more bad.
2:16:48
Guys, we're going to go get these guys and we'll see what
2:16:50
they would do is Similo had a practice called and it's in your
2:16:53
notes heating up the Plaza. Remember, because they went into
2:16:56
waters, they tried to double cross them to take over the
2:16:58
control. The problem is waters is too
2:17:00
powerful. Like they couldn't defeat waters
2:17:04
militarily. So what they said, so they said,
2:17:07
OK, you know what, we need our help from our our benefactors in
2:17:11
the Pond political party. So Pond goes to the American
2:17:14
government, says, hey, if you bankroll lost our operation,
2:17:17
we're going to go in there and smash waters.
2:17:19
Well, prior to that, Sinaloa sent their people into waters
2:17:24
and they were just like unaliven police officers, they call it
2:17:26
heating up the Plaza. They get a lot of attention on
2:17:28
the city, but they're like, so? The federalities would come in.
2:17:32
The Mexican, the hitters from Sinaloa would go in and they
2:17:35
take out like a City Council person.
2:17:37
They take out like a local municipal mayor.
2:17:39
They'd shoot police officers. Because now you're going to
2:17:42
start getting a lot of coverage in the news like, hey, Waters is
2:17:45
beating up. We got a bad problem there.
2:17:48
So then the political officials can go to president and in the
2:17:53
Kovidan administration say, hey, look what's going on in Waters.
2:17:55
We got. We got.
2:17:57
To clean this up, we got. We got.
2:17:58
To clean that up, it's all in the news every day.
2:18:00
The newspapers are covering it, The news coverage is on it.
2:18:02
So they use America. So then they go to the United
2:18:04
States and say, hey, look what's going on down there and, and
2:18:06
what is? And that's when George W Bush
2:18:08
said those are some bad hombres. I remember that.
2:18:12
That that's the bad Hombres speeches that's going into
2:18:14
waters. So they said, of course,
2:18:15
whatever you need to go get them.
2:18:17
So they put together Operation Juarez, thousands of troops get
2:18:21
dispatched into Juarez to try to collect to to try to take
2:18:26
control of that Plaza that Sinaloa had manufactured his
2:18:29
entire problem. Well, what's you know, and it
2:18:31
was interesting. This is like 2008, 2009.
2:18:34
What was interesting is when the military went into Juarez, you
2:18:41
had shootouts in the street where and it was being covered
2:18:45
on the news. We're watching the Spanish
2:18:46
language news in prison and it's they're talking about another
2:18:49
shootout in the street. But it wasn't narco against
2:18:52
narco. It was uniformed.
2:18:53
Military soldiers are shooting it out with members of the
2:18:56
Waters Police Department. You got like their SWAT team.
2:18:59
So the federal allies against the local SWAT team.
2:19:01
Yeah, because the local authorities are.
2:19:02
Protected. So that'd be like, you know.
2:19:04
It'd be like the, the the the. U.S.
2:19:05
Army coming against Largo PD. Right or you know, or Chicago PD
2:19:09
or LAPD, you know, so you've. Got against the US government,
2:19:13
yes. Because the local political
2:19:14
structure was controlled by a different political party.
2:19:17
The Pond control federal authorities, but it's a federal
2:19:19
system. But it might not be the
2:19:21
governor. The governor is a different
2:19:22
party. But the feds could come up and
2:19:24
and could wipe out that local municipality for the most part.
2:19:27
So then that's why you had, you know, you had the multiple
2:19:31
cartels create competition within the drug trade after
2:19:36
2000. You now had competition within
2:19:38
the political class. So these are what are
2:19:40
essentially called multipolar traps in game theory.
2:19:43
And so each of these parties acting in their rational short
2:19:47
term interest create a circumstance that is disastrous
2:19:50
for everybody in the long term. But neither one of them, neither
2:19:53
group could unilaterally stop because you're going to give an
2:19:55
advantage short term to the current group.
2:19:58
So it creates this cascading series of it's a negative
2:20:01
feedback loop. And so you have the shootouts
2:20:04
now going on. And what is Army soldiers
2:20:07
shooting it out with the police? That's a shitstorm.
2:20:11
That's. How did that get?
2:20:12
How'd that work out? The, you know, Sinaloa was never
2:20:16
able to take control of the Plaza because the problem is, is
2:20:22
while that's going on with Operation Juarez, you had
2:20:25
another incident with Guzman POS.
2:20:28
He sets up Valencia double crosses.
2:20:29
Valencia in 03 double crosses. Wasn't the Carrillo in 04 in
2:20:35
2008 one of the main factions, the Beltran faction of the
2:20:39
Sinaloa? Guzman it's cousins?
2:20:43
Well, Guzman double crosses the leader of the Beltran because
2:20:47
look, every time someone got a little too powerful.
2:20:50
Guzman double crossed you. He double crossed like Valencia
2:20:53
was getting too powerful and he had access to that sweet, you
2:20:55
know, the the pie that they wanted.
2:20:57
They wanted that meth pie. They wanted the Plaza and
2:21:00
Juarez. Meanwhile Arturo Beltran, his
2:21:02
organization was much bigger trafficking wise then Guzman or
2:21:08
Zambadas like Gordo now was bigger than Guzman and Zambada.
2:21:13
Arduto Beltran was bigger than Guzman or Zambada.
2:21:17
And so Guzman decides you know what, we're going to double
2:21:20
cross Beltran. He gets arrested.
2:21:24
This kicks off another war. So now Arduto Beltran, who was
2:21:28
no punk himself, he like they like, you know, like Vicente
2:21:32
Carido de UN alive, Guzman's brother.
2:21:34
This guy analyzed Guzman's son. No, no, it's all out.
2:21:37
Oh, it's bad. No, it's bad.
2:21:39
So you got cartels fighting each other and.
2:21:41
This is circa. 2008, 2008, 2009 Meanwhile, Artuda Botha is the
2:21:45
guy who's paying the Mexican Secretary of Defense.
2:21:47
So the Secretary of Defense is like, whoa, whoa, whoa, whoa,
2:21:50
whoa. I need my why are you coming
2:21:51
after my guys? So you've got like the federal
2:21:54
authorities in Mexico and the law enforcement side getting 50
2:21:56
million a year, splitting 450 total with this pie going up
2:22:02
against the guide is being protected by the military, the
2:22:04
Defense Department, Mexico's going it's all hell at this
2:22:08
point. Oh, yeah.
2:22:10
So how, how, how long can they? How long does that go?
2:22:12
For well, and it hasn't stopped. It's still there.
2:22:17
Well, we're about to get ready to stop because we'll end this
2:22:19
at the beginning of the new generation, OK?
2:22:20
And so in 2008 they double crossed Beltran kicks off
2:22:24
another war with the Beltran Leva faction.
2:22:26
And Guzman still. And, and Guzman's the problem of
2:22:30
all this, right? He's, he's, he's just, you know,
2:22:33
he's, like I said, just a general piece of shit, general
2:22:36
piece of shit. Now, in 2009, while this thing's
2:22:41
going on with the Beltrans the lawyer in San Diego, Humbert's a
2:22:46
lawyer. Oh, he's still around.
2:22:47
He's still around. He's been feeding information to
2:22:49
the Americans. For the last eight years now.
2:22:51
Does he get paid for that? He was charged for facilitating
2:22:55
money laundering operations. He was indicted and his charges
2:23:00
went away. Oh.
2:23:02
So now, of course, he's getting paid by the Mexican side.
2:23:04
Sure, the cartel boys are paying, but his benefit from the
2:23:07
American side is he entered into a cooperation agreement with the
2:23:10
authorities where he's now feeding them the information.
2:23:15
That's from the Mexican perspective.
2:23:17
They think they're manipulating the DEA into taking out their
2:23:19
rivals. From the DEA perspective, they
2:23:21
think they're manipulating the Mexican government.
2:23:24
Really, they're all just. The shell game.
2:23:27
They're all just fucking each other trying to to advance their
2:23:30
own short term interests. So Humberto Loya at 2008.
2:23:33
He's been on the on the payroll for 7/8.
2:23:35
Years. I was going to say, man, you
2:23:36
know he's. He's, he's like, look, I'm
2:23:37
tired. He's been.
2:23:38
Around since the early part of this discussion.
2:23:40
Yes, yeah. So now he's like, look, I'm done
2:23:42
is. He getting older.
2:23:44
He's like, I'm going to relinquish, we're going to hand
2:23:45
over the new point of contact because Sina Loa's got to
2:23:47
maintain contact with the DEA because so they said, OK, well,
2:23:51
who can we send to be the point man, the point contact with the
2:23:55
DEA that the DEA knows has the authority to represent what's
2:24:01
actually going on. On the.
2:24:03
On the cartel. Side on the I was going to say
2:24:05
on the cartel side, so who the DEA actually has a connect?
2:24:08
Yeah, Zambada sends his son. OK, so it's Vicente Zambada now
2:24:14
it becomes it's blood. Yeah, So it's just.
2:24:16
So when he says, hey, my father says they know he's talking to,
2:24:19
it's not just Poncho down the street.
2:24:20
He says, I know a guy who knows a guy who knows Zambada.
2:24:23
It's blood. Yeah.
2:24:24
So like he's able to represent this is what we need or this is
2:24:29
what we want. I'll keep in mind later on this
2:24:31
gets disputed because the DEA gets caught up in a bad spot.
2:24:34
But Zambada junior Vicente becomes a new contact man.
2:24:39
Lawyer says hey Umberto. The lawyer says, I'm going to
2:24:41
introduce you to Vicente. He's going to take over my job.
2:24:45
The DEA and the US Department of Justice send high-ranking
2:24:48
officials into Mexico. Now they don't clear with the
2:24:49
Mexican government. This is total clandestine
2:24:51
operation. Oh, they don't.
2:24:53
That's no the federales don't know they're coming.
2:24:55
Yeah, the the Mexican government don't know that the DOJ Mexican
2:24:58
are maintaining relationships with cartel men.
2:25:01
Remember, Sinaloa is the biggest cartel in the Western
2:25:03
Hemisphere. We're meeting and this is
2:25:05
Vicente Zambada is the #2 in the organization.
2:25:09
Like his dad's the point man and Vicente is the most second most
2:25:13
powerful person within the Zambada faction and he's the
2:25:16
heir apparent. And he's dealing with the with
2:25:19
the US government. And that's the people that the
2:25:21
DEA starts meeting with. Like keep in mind Vicente
2:25:24
Zambada's got indictments all over the place in the US he's
2:25:26
wanted for multiple times. His father.
2:25:29
No, him. Oh, him.
2:25:30
Yeah, of course. The guy that we're using as our
2:25:32
connect is 1. They're.
2:25:33
Meeting with the DEA. They're meeting in some luxury
2:25:36
hotel in in Mexico City. He's already wanted on charges.
2:25:41
But is that why they can't meet with him on US soil?
2:25:43
Because he knows he could yoke him up?
2:25:45
Or. He'll never go on the US soil
2:25:46
because he's not going to trust him.
2:25:47
He's not going to trust these crazy gringos.
2:25:49
He tells me in Mexico. City.
2:25:51
They meet in DFA in Mexico. City and they think that they
2:25:53
got a an ultra inside connect. They do have an ultra inside
2:25:56
connect. They do, yes.
2:25:57
Because he's feeding. Hey that this group over here.
2:26:01
He's giving them all their out. This is this.
2:26:02
Is where the stash houses are and this is their money
2:26:05
laundering network and this is their supplier because from
2:26:09
their perspective, seen a lot to them, it's one of their most
2:26:11
effective arrows in their quiver is persuading the American
2:26:14
authorities to engage in decapitation strikes and nothing
2:26:18
the American government loves more than decapitation strikes.
2:26:20
They love to yoke up the bad guy.
2:26:22
So they give them the information.
2:26:24
The guy from Venezuela? Yeah, yeah, yeah.
2:26:25
All that, all that's all inside jobs.
2:26:27
And so Zumbada Junior is feeding information to the DEA and the
2:26:31
DOJ. Now what's interesting is on now
2:26:37
this is one of the most wanted men in Mexico.
2:26:39
Also Zumbada Junior, he's leaving the hotel in Mexico
2:26:43
City. He just had a meeting
2:26:45
high-ranking DOJ officials from DC along with DEA officials from
2:26:50
San Diego, which is the field office that Humberto Loya worked
2:26:52
with and US attorney's office like attorney's from that
2:26:56
particular US attorney's office who handled lawyer like Valente
2:26:59
Zamata took Humberto Loya's spot.
2:27:03
So he's technically an informant or what the government would
2:27:06
characterize as an asset because he's providing intelligence to
2:27:09
the Department of Justice and the DEA through the San Diego
2:27:13
office. But he's so important that DOJ
2:27:16
reps from DC get sent also. So they have one of their
2:27:20
meetings up and they have a meeting at the high rate at a,
2:27:22
you know, luxury hotel in Mexico City.
2:27:25
The model leaves the hotel, he's walking out and some random cop
2:27:29
sees them like some Dugarder cop, Like hey.
2:27:34
He's wanted. I'm going.
2:27:36
To I'm going to get a I'm going to be a hero, yeah.
2:27:39
So he calls in back up, they arrest Vicente Zambada.
2:27:43
And and the and and and our feds.
2:27:45
Well, they don't. They don't know about our feds.
2:27:47
No, no, I know, but they're. There.
2:27:48
So they are. They're up in room 4 O 5.
2:27:52
And Zambada. Zambada's walking through the
2:27:54
lobby and all of a sudden he gets pounced on.
2:27:56
Boom by the federalities. Aha.
2:27:58
You're arrested, Vicente, man. Put your hands up.
2:28:01
They cuff him up. He's like, what do you?
2:28:02
He's doing? Like, I'm here, I'm working with
2:28:04
you guys. Like, what do you mean you're
2:28:05
working with us? I'm meeting with the gringos.
2:28:09
Sinaloa doesn't know that the Americans are operating behind
2:28:11
the Mexican government's back. He's like, I'm here with the
2:28:14
fucking gringos. I'm like, what?
2:28:15
Gringos up in Room 602. We're actually put you oh, so
2:28:18
this is all a big they have no idea the.
2:28:20
Mexican, the military guy, the the police guys go off the room
2:28:24
602. There's DOJ officials from DC,
2:28:27
US Attorney's office, officials from San Diego, DEA officially.
2:28:30
What the fuck is going on? Massive scandal in Mexico.
2:28:35
Like, we really didn't hear too much of it here in the United
2:28:37
States. No, we didn't hear it.
2:28:38
We this. Was the biggest scandal in
2:28:40
Mexico. Why is the US government meeting
2:28:43
with? It'd be the equivalent of Donald
2:28:46
Trump junior meeting with John Gotti in a apartment in.
2:28:50
Brooklyn, or or or meeting with the President bin Laden's son,
2:28:55
the president of China's. No, no, it's something like
2:28:57
that. Like the most wanted individual,
2:28:59
his son. Yeah.
2:29:01
So Osama bin Laden back in the day, his son meets with Donald
2:29:04
Trump junior like in that's no boy in Kuwait, you know, or
2:29:08
something. Right.
2:29:09
Yeah, no. And so like, this was a massive.
2:29:11
That's a real shit. Storm.
2:29:12
It was a huge shot. What?
2:29:14
So what the what happened? From that point forward, there
2:29:17
is nobody in Mexico, and I'm talking about amongst the common
2:29:20
population, who do not believe that the American government is
2:29:24
behind the scenario cartel. Still.
2:29:26
Well, no, no, no. At that point, they didn't know
2:29:28
that Calderon was doing all these attacks.
2:29:33
So it's like, hold on a second, the Mexican government smashing
2:29:36
Mitro Con, they're smashing Tijuana, they're smashing the
2:29:38
Gulf, they're smashing waters, they're smashing Zetas while the
2:29:42
DEA is meeting with Zambada. So everybody there now thinking.
2:29:47
Everybody thinking that the American government is
2:29:49
protecting Sinaloa. And they are.
2:29:51
Well, they're they're using Sinaloa for actionable Intel.
2:29:55
But it's at the end of the day. But at the end of the day, it's
2:29:57
like. Sina Loma's just they're serving
2:29:59
them up their competition on a platter.
2:30:01
Yeah, but these are massive cases that they're.
2:30:02
Doing I know too, I know, but I mean, you know, it's at the, at
2:30:06
the at the at the benefit of Sina Loma.
2:30:09
They're like, man, we'll let the US do all of our dirty.
2:30:11
Work. Yeah, that the grain nobody.
2:30:12
'S more powerful than them, I. Remember, they're the big bad.
2:30:15
Well, remember when you formed together the cartel, you had to
2:30:17
go. They're to pray.
2:30:18
Well, who's the predators? The bigger cartels, the Mexican
2:30:23
government, and of course, who's the biggest predator?
2:30:25
Uncle Sam. Us or them?
2:30:28
There is. More powerful than the
2:30:29
FBIDEACIANSA? Come on, that's.
2:30:32
The ice. You know, so that's so from
2:30:35
their perspective, they had to come together like a school of
2:30:37
fish or like a look. If you're if you're if you're a
2:30:40
gazelle on a Serengeti and you come across a line by yourself,
2:30:43
you're in trouble. But if you're 1 of 5000 in a
2:30:46
herd, well, what are the chances of you getting eaten?
2:30:48
It'll be all right, right you've.
2:30:49
Got a 1 to 5000 chance. Plus, you're a slow fat one like
2:30:51
Bubba Clem. But if you're if you're Pete
2:30:53
Racina Gazelle, you're out of. There, that's right.
2:30:55
And so the yes. And so, you know, the weak, the
2:30:59
weaker parties always form collectives for the purposes of
2:31:02
enhancing this, the likelihood of survival for anyone
2:31:06
particular member of that tribe or that.
2:31:08
Is that is that still? Is that power structure still
2:31:11
set there today? Of course, that's why they
2:31:12
formed Cardeos. So we provide cover for the Sina
2:31:17
Loma. Well, we don't provide cover, we
2:31:18
provide the threat because they have to be able to raise enough
2:31:22
capital to satisfy. Now do we get, do you think,
2:31:26
Pete? Well, I'm not asking you if you
2:31:27
think what's your opinion of us being on the take, much like
2:31:32
their government is, no. Look, I'm not going to sit here
2:31:35
and say I was. Just.
2:31:36
Saying I did 2 decades in prison.
2:31:37
But look, you got to be fair in your analysis.
2:31:39
Yeah. No, I mean like there are
2:31:41
individual agents that are. Compromised some kickbacks here
2:31:44
and there, but it's not on the scale of look of of an official
2:31:47
getting 50 million. Dollars.
2:31:49
The Whitey Bulger circumstance was enormous because you got a
2:31:51
crooked FBI agent. Well, that was nationwide news.
2:31:54
It's one fucking guy. That's one guy.
2:31:56
The Rampart scandal in LA was three cops.
2:31:59
Yeah, so do you. Remember the Valley P when, when
2:32:02
Pawn took office in 2001, the first thing they did is they
2:32:06
fired every police officer in Tijuana.
2:32:09
The entire That's a city of 4 million people. 3 million
2:32:11
people. So they're like, you guys are
2:32:13
all on the fucking take. This is a, this is a most, I
2:32:15
don't know if it's, I think the greater metropolitan San Diego,
2:32:18
Tijuana area is several 3 to 4 million people.
2:32:20
But he wanted itself as a million, million and a half
2:32:22
people. Fire everybody in the Police
2:32:24
Department. There's none.
2:32:27
Of you can be trusted. No, everyone's getting paid so
2:32:32
and so, yes and so the. Let's Fast forward.
2:32:35
To like modern day now here it is like we're going to end it
2:32:37
right now in 2010. Well, in 2009, you've got the
2:32:40
multiple skirmishes. We've got the wars war going on.
2:32:43
You got the war with the Beltrans going on.
2:32:45
You got Vicente Zambada getting arrested, massive fucking
2:32:49
scandal in Mexico. And what you had was the next
2:32:54
year, some at this point, people within the government had
2:32:59
started leaking because information started getting fed
2:33:05
to like college professors that were doing the analysis.
2:33:09
And then they went public with the analysis saying, hold on a
2:33:12
second, Mexican government has had five military campaigns and
2:33:15
the beneficiary of it is Sinaloa.
2:33:20
On top of that, you had this huge scandal.
2:33:22
Sinaloa was meeting with the Gringos.
2:33:25
That nobody knows about. That the Mexican government
2:33:27
didn't authorize. You're going behind their back.
2:33:30
And so now you've got this huge perception that Sinaloa is
2:33:33
protected by the American government.
2:33:36
Now, does that make the Mexican government not want to help see
2:33:38
Malone as much? No, because they're the ones
2:33:40
getting to 450 million a year to get into 50 million a year to
2:33:42
get into 60 million a year. So see, they don't trust the
2:33:45
Americans. Is still the big fish that's got
2:33:47
that has the kickbacks. Yeah, because here's the.
2:33:49
Thing but the but the government that the Mexican government
2:33:51
doesn't trust us. Yes, because here's what we're
2:33:53
up to. Like when when when Calderon
2:33:56
took office in O Six, he did just to establish a new sheriff
2:34:02
in town. He had to level, set the playing
2:34:05
field. And So what he did is he for the
2:34:08
first time extradited a group of high-ranking narcos.
2:34:12
This is when Armando Valencia comes to the United States.
2:34:14
This is when what Obama comes to the United States.
2:34:16
This is when OCL Cardinals comes to the United States.
2:34:19
So these are guys who, you know, left.
2:34:21
With the new president. From 1990, the first full year
2:34:24
of the modern cartel era, and 2006, there was a status quo
2:34:29
where if you were a narco and you got arrested, you're going
2:34:33
to serve your time in Mexico. Because all of them were
2:34:36
potentially looking at life sentences in United States.
2:34:38
And the Mexican law did not allow for anybody facing a life
2:34:41
sentence. Even if the American government
2:34:43
says we're not going to give him life, but he's subjected to the
2:34:45
possible so he can't be extradited.
2:34:48
Called it on and got that changed.
2:34:51
Oh, he changed that. So now in O 7 they start sending
2:34:55
these narcos. These sacrificial lands.
2:34:57
Big guys or for the most part from rival cartels, then the guy
2:35:04
from the but. But they're the big boys.
2:35:06
Then the guy from yeah, so there's they had they had
2:35:10
massive high profile recognition in Mexico and the American
2:35:17
government's like, aha, these guys are serious.
2:35:19
They're giving us the big boys, big boys, not realizing that
2:35:22
they're just dumping the other guy's trash.
2:35:26
Now, when that happened in O 7, that changed the dynamics
2:35:30
because up until that point, the Mexican cartels had to pay for
2:35:35
the Plaza. Whoever got the privilege of
2:35:36
controlling the Plaza, they had to pay the pisel to the
2:35:39
authorities. But the amount of money was
2:35:44
modest, like Amato Caligio was paying the head of the Mexican
2:35:48
military's counter narcotics operations.
2:35:50
That was 10 million a year, a good significant amount of
2:35:53
money, but it wasn't 50, right? It wasn't 60.
2:35:57
It was, it was, it was 10, which you know when you're doing 30
2:36:01
billion a year. Well, no, yeah.
2:36:03
And so now at that point, it was much smaller back in the 90s.
2:36:06
But the point is, is once they started extraditing guys, you
2:36:10
know, 17 United States, that broke the status quo.
2:36:14
Now you get apprehended. Now cartels have to worry about
2:36:17
going back to US. You get something you're not
2:36:19
having, you know, weekly parties at the prison and then bringing
2:36:23
in 40 hookers at a time for the guys on the range to say 3 or 4
2:36:27
days with them and shit got real.
2:36:28
Shit. Shit got real.
2:36:29
So it introduced 2 elements, a lot more violence because now
2:36:33
they're not getting taken alive. They got to shoot it out.
2:36:38
So that introduced. The violent aspect of it.
2:36:40
Much more violence. Before it was violence between
2:36:44
the groups for control of plazas or control of strategic assets,
2:36:46
the ports, that kind of stuff. This is now where you start
2:36:49
seeing them. Hey, they're shooting it out
2:36:50
with when the soldiers come to arrest you, they're getting
2:36:55
blasted. Shoot it out.
2:36:58
Well I mean they want to go out to arrest Arthur Beltran.
2:37:00
They weren't taking him alive. Well him and his men had like a
2:37:02
2 day three day gun battle. They were just coked up for two
2:37:07
days. And they just blowing off
2:37:09
machine guns like a fucking war zone.
2:37:11
Yes, one of the one of the most intense firefights of all narco
2:37:16
history was when they came to get Arthur Beltran.
2:37:18
The military couldn't allow him to live and he wasn't going.
2:37:22
So it was. And so you had those type of you
2:37:26
had those when they went to go get Oseo Cardenas shoot, I mean,
2:37:30
these guys were that was a. Was the Pablo Escobar a pretty
2:37:33
big shootout too? No, because he.
2:37:35
He was kind of in the trying to get.
2:37:37
He was trying. To run away and he didn't have a
2:37:39
large contingency, Yeah. Yeah, he didn't have a big.
2:37:42
Costume Beltran had a large group of guys with him and he's
2:37:45
calling it reinforcements, but his boys are showing up.
2:37:48
They're just like it. It's all out war.
2:37:50
And you know, the Army's calling in more people.
2:37:52
They got helicopters under allies.
2:37:54
They know it's, I mean uniform Army soldiers showing up.
2:37:57
I mean, it was just all out war between these two groups.
2:38:00
So that introduced the the element of extreme violence
2:38:05
against the arresting agencies because they know if they get
2:38:08
apprehended, they're going to the United States.
2:38:10
That means they're going to ADX. So that you you might as well
2:38:14
shoot it out. That that introduced that now.
2:38:16
Now, is that where we are now? Well, here's the other.
2:38:18
The other side of that is that gave the Mexican authorities
2:38:22
leverage to go to them and say, hey, look, we can avoid all
2:38:26
that. I don't know.
2:38:28
I don't want 10 million, I need 50 million.
2:38:32
They tell the card out they they.
2:38:34
This is what creates the protection market we're now and.
2:38:37
That's where we are today. That's, then that's, that's
2:38:40
still operating the protection market exist because the Mexican
2:38:45
equivalent of the FBI director can say, hey, if you get caught,
2:38:48
you're going to Gringoville and you're going to be at ADX.
2:38:51
But if you give me 50 mil, I got you and you give my buddies 400
2:38:55
mil, 450 between all of us, we'll go get your adversaries
2:39:00
and we'll protect you. We'll tip you off when they're
2:39:02
coming for you. We'll insulate you.
2:39:04
So the the scale of the payments skyrocketed.
2:39:08
And what used to be 10 million is now. 50 million. 50 million.
2:39:12
50 million, now 3. 100, this guy, well, this is that era and
2:39:16
this is documented because Henato Luna was prosecuted, he
2:39:18
was doing 50 million. Rodriguez, the DEA guy was
2:39:20
They're equivalent to DEA chief doing 30 million since Vegas is
2:39:23
doing 60. Million.
2:39:24
What was the highest paid US operative ever that that you
2:39:27
know of potentially? I mean American citizens.
2:39:30
Yeah, well, you know like a like AUS official or like a is there
2:39:35
any documented? There was in in.
2:39:37
In and I'm not asking. In my Case No.
2:39:39
No, in my case there was a federal officer involved with
2:39:42
the task force and they ripped us off for over 2 million.
2:39:45
Just a just a single officer or like a couple?
2:39:47
Officer and an agent and two of his informants, but a but a two
2:39:52
and a half million lick in 93 was huge because that'd be about
2:39:54
7 million. Today, Yeah, absolutely for a
2:39:56
couple guys. Right.
2:39:57
Yeah. And it just split up because
2:39:58
that was in product and money and then the informants just
2:40:01
allowed product. So it's so in closing, we are up
2:40:04
to the modern day. Yeah, the modern is the.
2:40:06
Protection market Protection area.
2:40:07
Protection market was created in O7 which scaled up the amount of
2:40:12
money that the political parties.
2:40:14
Needed to. Protect were able to get extract
2:40:17
and the corrupt officials were able to extract now because they
2:40:22
had to maximize the profit because the payments went up by
2:40:25
5 fold. You had a shift from the cartels
2:40:31
because now they had to be able to focus on a compounds that are
2:40:34
more profitable. You see with the cocaine, you
2:40:37
may make a 200% return on your investment after all the
2:40:40
expenses. Lucrative, but.
2:40:44
And it's lucrative if you're paying 10 million from bribes.
2:40:47
But methamphetamine and ice? But ice is much more profitable.
2:40:51
You're making a 700 to 800% return.
2:40:53
So in O7O8, when the protection market took hold, they went all
2:40:57
in on the meth. But their protection numbers go
2:41:00
up too, 6:00 and 7:00. Because they have to be able to.
2:41:02
They have to. They need a much more larger
2:41:05
return on investment in order to meet the demands that are being
2:41:09
extorted the the narcos are getting extorted by the greedy
2:41:12
political class in Mexico. So.
2:41:13
So everything has to go up because.
2:41:15
Everything has to. Scale up because the protection
2:41:17
money has been a. Threat, because otherwise you go
2:41:20
to the United States. And you?
2:41:22
You're done. You're done because now you're
2:41:23
going to go to ADX like it's not a cushy Mexican.
2:41:25
So it's just, hey, listen, how much is your freedom?
2:41:28
How much is it worth? How much is it worth to you?
2:41:30
So now, since everybody had to scale up in the amount of
2:41:32
protection they had to pay, they pivoted into the synthetics.
2:41:36
They did the same thing again in 15 with another pivot penny.
2:41:40
And that's where we are now. So now going into 2010, and
2:41:43
we're going to wrap this up right now, you've got Belt
2:41:46
Beltran's at war with Guzman because Guzman's Beltrayed
2:41:49
Valencia. He's betrayed Carrillo, he's
2:41:51
betrayed Beltran, and now he's looking at, you know, who's got
2:41:58
the sweetest pie out of this whole thing?
2:42:01
Nacho Cornell, the guy in Jalisco, oh, before that, in O9,
2:42:06
they also betray Lobo Valencia. So after Armando Valencia gets
2:42:09
taken out, Lobo Valencia takes over.
2:42:12
Now Lobo's, his nickname is Wolf.
2:42:15
Lobo takes over, he gets knocked off.
2:42:18
So now it's the person that's you got Guzman, Nacho Cordo.
2:42:22
Now, Robo Valencia's out of the way and Guzman's like, you know,
2:42:28
the crown jewel of everything. Particularly now with the
2:42:30
protection market. The biggest cash cow is the
2:42:34
meth. Well, who's the king of the
2:42:35
crystal? Nacho Cordonel.
2:42:40
Double crosses Nacho Cordonel. So he double crosses the guy the
2:42:43
the king of meth. And and he does so shortly after
2:42:46
Nacho Cordonel marries, or, excuse me, Chapo Guzman marries
2:42:51
Nacho Cordonel's niece. Chapo Guzman's wife is Emma
2:42:54
Cordonel. So he's related Chapo's now.
2:42:57
I mean, I'm sorry, Guzman's now related and then.
2:43:00
Nacho Carnot sponsored the wedding.
2:43:03
Knocks off the biggest meth guy. Double crosses.
2:43:07
Double crosses him. He gets out of the way now.
2:43:09
This is what gives rise to the new generation.
2:43:11
And we're going to stop right here because the new generation
2:43:14
grew out of Jalisco twice, Jalisco new generation and it's
2:43:18
the the subordinates. And that's where we're at.
2:43:22
Yeah, that's the new generation is like Nacho Cordonel's kids.
2:43:25
Now, is that what it is that what it's called the new
2:43:26
generation? The new generation because the
2:43:29
and the. Protection numbers are just
2:43:30
absolutely absorbed. And that that's why they had
2:43:33
they are the ones that pivoted into the Fenny in 15 after and
2:43:37
because the president that took the 100 mil deposit good faith
2:43:40
deposit on the 200 million payout.
2:43:42
Did he get busted? No, he sent in Operation
2:43:44
Jalisco. 10 So, Pete, let me ask you a question last.
2:43:48
Time. So then Jalisco needed to say
2:43:49
how we need to be able to raise our capital.
2:43:51
We're not making enough money with all the crystal, but we
2:43:52
need the supercharge. All these guys, these these
2:43:55
heads of what would be equivalent to the FBI, these
2:43:57
heads of the Department of Defense that are taking 506080
2:44:01
million, $400 million are are they able after their term is up
2:44:06
or are they, are they just allowed to be, you know, worth
2:44:09
3, four, $500 million and come and go and be free citizens And
2:44:14
they were never convicted or. Tried drug trade history?
2:44:17
Yes, surprisingly during the first Trump administration they
2:44:24
charged in auto Luna. Like whatever the motivations
2:44:28
were, I don't know. Which was a government?
2:44:30
Official, which was the equivalent of the FBI director,
2:44:32
like the minister of public. Security.
2:44:34
But is he the only guy willing to go down?
2:44:36
He was, I mean. He's he's doing 30 years right
2:44:38
now. None of the presidents have gone
2:44:39
down and. In fact after he was convicted,
2:44:43
one of the sub cabinet level generals, like not the Secretary
2:44:48
of Defense, a sub level 1, he came forward and said look, the
2:44:50
president called it on you all along.
2:44:53
But the president didn't get nothing.
2:44:55
We don't know what he got. We know that four cabinet level
2:44:57
officials. We know one thing, that he's not
2:44:59
in prison. He he's not in prison.
2:45:00
He's under indictment. And those guys aren't coming to
2:45:03
the US. And they're not coming to.
2:45:05
Vacation in Miami. There could be secret
2:45:07
indictments already waiting on them, right?
2:45:09
And so they're like, oh, we'll just stay in Mexico.
2:45:10
We're going to stay in Mexico with our 50 or 60 or 7 and
2:45:14
708090 million in Mexico, I mean, please.
2:45:17
And so then when? Is the cost of living far
2:45:20
cheaper over there or is it is it to scale?
2:45:22
I mean, if you want to live in a $4 million penthouse, you can.
2:45:25
You'd be surprised how expensive like the nice areas are.
2:45:29
What is it? What?
2:45:30
What are the nicest areas of Mexico?
2:45:31
Well, in. Guadalajara.
2:45:33
Of course, but you know, Cabo is essentially a resort town that
2:45:39
cartels developed. Where do all like all the the
2:45:42
people that made 10s of millions of dollars?
2:45:46
Where do they live in Mexico? They'll live in around
2:45:49
Guadalajara, which is very affluent, the city of Monterey
2:45:52
very affluent and. Now will they have personal
2:45:56
protection of? Course, this is all you know.
2:45:59
Look, remember a a significant number of the individuals within
2:46:04
the business elite profit from the drug trade.
2:46:07
In fact, next, when we pick up on our next one, next cartel
2:46:10
special, we'll do the birth Part 3, the development of the new
2:46:13
generation. Well, you've got Mexican
2:46:15
billionaires that are sponsoring their loads.
2:46:19
Oh, so it's just so it's like an investment.
2:46:22
It's essentially a private equity.
2:46:24
It's almost like the way that they do movie investments here
2:46:27
in America, we're like, OK, we want to build a we want to do a
2:46:30
$60 million project and we got, you know, Denzel Washington and
2:46:33
Brad Pitt and. They get 20 million producers.
2:46:37
Each group will say we'll put in 15, we'll put in 20, we'll put
2:46:39
in and. Then you get 3 points or five
2:46:40
points or 10 points after payback.
2:46:42
That's the model. That's the model, but it's on
2:46:45
the drug side of things. On the drug side of things,
2:46:46
certainly. And Pete learned a lot today, my
2:46:48
friend, appreciate you. And this is I think this
2:46:51
warrants for a third one, which will be the new generation.
2:46:54
Sure. Deadly intentions, my friend, go
2:46:56
to deadly intention show. As you know, you're here, get a
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subscription, it's free, get a notification, subscribe to the
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channel. We're, I don't know, 567910
2:47:07
episodes deep and we keep churning them off and now we're
2:47:10
monetized. So baby steps my friend.
2:47:12
And you guys seem to love the drug talk.
2:47:15
We'll have more of it for you coming soon.
2:47:17
Appreciate you.