[Congressional Record Volume 145, Number 41 (Tuesday, March 16, 1999)]
[House]
[Pages H1326-H1331]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
WHERE ARE THE DRUGS COMING FROM?
The SPEAKER pro tempore. Under a previous order of the House, the
gentleman from Florida (Mr. Mica) is recognized for 60 minutes.
Mr. MICA. Mr. Speaker, I come again tonight to the floor of the House
of Representatives as chair of the new Subcommittee on Criminal
Justice, Drug Policy and Human Resources to talk about a situation that
is confronting our Nation, Congress and has touched almost every
household in America, and that is the situation dealing with illegal
narcotics. The situation basically is out of control and affects our
young people. Some 14,200 Americans died last year because of drug-
related deaths. This is a problem that has been swept under the table
by Congress, by this administration and not really addressed adequately
in my opinion. As chair of the Subcommittee on Criminal Justice, Drug
Policy and Human Resources responsible for developing at least the
House side of our national policy, I intend to continue my efforts to
bring this situation to the attention of the American people and to my
colleagues here.
Mr. Speaker, the situation is so bad relating to narcotics,
particularly among our young people, that the statistics are absolutely
staggering and should shock every American, particularly in the area of
hard drug use by our young people. The statistics since 1993, when this
administration came into power, of drug use among our teens and our
young people, the instance of use of heroin by our teenage population
has soared 875 percent.
In the area that I come from, Central Florida, a relatively
prosperous area, an area that has economic stability, growth,
viability, no inner city problems, our area has been absolutely wracked
and ravaged by deaths, particularly again among our young people, our
teenage population and young adults by heroin deaths. In fact, in the
Orlando Sentinel, a headline at the end of last year said that the drug
overdose deaths in Central Florida exceed homicides.
One of my first duties and responsibilities as chair of this new
subcommittee to deal with drug policy was to conduct a hearing in
Central Florida on the issue, and I was told by the father of one of
the young people who died of a drug overdose, a heroin overdose, ``Mr.
Mica, those who have died from drug overdoses are in fact homicides.''
And that situation is repeating itself across our land.
Not only do we see increased use of heroin among our young people and
in my area and other areas, we are now seeing more and more Mexican
black tar, high purity heroin, coming across the border into Texas and
other border States. Additionally, the amounts of methamphetamines
coming into middle America, the western States and across this land are
soaring dramatically. The episodes in our emergency rooms from
overdoses across the land are increasing, not decreasing, and again we
are seeing more and more of the drug abuse of these hard, high-purity
drugs such as cocaine, heroin, methamphetamines among our young
population.
Tonight I wanted to spend most of my time talking to my colleagues
that are listening and the American people that are listening about
where those drugs are coming from, and it is very easy for me to
identify where those drugs are coming from.
If I may, if we could pay attention to this chart, it is very easy to
see that the drugs are coming from South America, primarily Colombia
where heroin and now cocaine from coca production have increased since
this administration has stopped equipment or stopped in the last few
years equipment reaching Colombia, helicopters, ammunition, eradication
equipment reaching that country. Incredible fields of poppies are being
grown in Colombia, and now we are told that Colombia is also the
largest source of coca production in the world, exceeding even Peru and
Bolivia, which both countries have managed to curtail some of their
production. But it is coming through Colombia and then transiting
through Mexico.
Mr. Speaker, today 60 to 70 percent of the hard drugs entering the
United States of America enter through Mexico, and this chart shows the
pattern of Mexican and Colombian based organized crimes, crime in the
1990's and currently. So, again we know exactly where these drugs are
being produced, and we know who is producing them, and we know who is
trafficking in those drugs.
Let me use, if I may, a quote that disturbed me as chairman of the
Subcommittee on Criminal Justice, Drug Policy and Human Resources, and
this is a quote from our chief DEA administrator. He said, and let me
repeat it, in testimony: Recently in my lifetime I have never witnessed
any group of criminals that has had such a terrible impact on so many
individuals and communities in our Nation. Mr. Constantine said
corruption among Mexican anti-drug authorities was unparalleled with
anything I have seen in 39 years of police work.
This is our chief drug enforcement officer for the Nation, and these
are his comments.
Now it would be bad enough to hear that from our DEA chief
enforcement officer, but all we have to do is as a Congress look at the
statistics about what is happening with Mexico. We look to see how our
partner, how our friend, how our ally is cooperating in the war on
drugs in the effort to stop the trafficking and production of illegal
narcotics.
Let me address two fronts. First of all, Mexico, which was a minor
producer of heroin, has now become a major producer of heroin, so they
are producing heroin and in larger quantities than they ever have and
at a higher deadly purity rate than we have ever seen before. The
second area that we would judge countries' cooperation with the United
States in dealing with the drug problem would be the amount of drugs
that are seized in that particular country, and that is how we base our
certification of a country in cooperating and making them eligible for
foreign assistance, international finance and international trade
benefits.
What are the other measures? As I said, first of all, again
production and then trafficking. In trafficking the statistics are
absolutely startling. In 1998 the seizures for heroin fell in Mexico,
the seizures for cocaine and coca products fell in Mexico. So the major
hard drugs in Mexico actually in the area of seizures decreased in
Mexico, so they were actually assisting us less in seizing hard drugs
coming across the border.
Then if we look at the other dangerous deadly drug that we have
talked about as methamphetamine, we find that not only the drug, but
the ingredients and the precursors to produce and traffic in
methamphetamine, another deadly hard drug today that is taking its toll
on so many young Americans, is also up, production is up, incidents of
finding this across our land are up.
Now I spoke very briefly about the process of certification of a
country, and there is confusion among the Congress and lack of
knowledge about the certification process. I was able in the 1980's, as
chief of staff for Senator Hawkins, to work with Senator Hawkins,
Members of the other body in Congress and this side, the gentleman from
New York (Mr. Gilman) and others who were here, the gentleman from New
York (Mr. Rangel), and the Congress adopted a drug certification law.
That is a simple law, and what it does again is it says that any
country who deals in illegal narcotics shall be certified annually by
the Department of State and the President of the United States as, and
the terms in the law are very specific, as fully cooperating to do
again two things. One, to stop the production; and two, to stop the
trafficking.
Now that is the certification. The administration and the President
must certify to Congress that these countries that are dealing in
illegal narcotics are in fact cooperating with us,
[[Page H1327]]
fully cooperating with us to stop the production and trafficking, a
simple law, a simple certification. And what do those countries get in
return for their cooperation and being fully certified? Mr. Speaker,
they get basically several benefits.
The first of these would be United States foreign assistance. So if
they are fully cooperating, they get United States foreign assistance,
foreign aid. They also would get foreign assistance as far as
international financial benefit and support. So in the World Bank,
Inter-American Development Bank, IMF, the United States, which is the
major underwriting partner for financing all of these international
operations and actually the basis of financial stability for so many
countries, including Mexico, the United States lends its vote to
approve various loans and grants and assistance from these
international finance organizations. So that is another criterion.
{time} 1815
Then the third area is the trade area. We give trade benefits. I
cannot think of any nation in the world that we have given a better
trade advantage to.
We have different levels of trade equity but there certainly is an
inequity between the United States, between our wages, between our
labor standards, between our environmental standards, between all the
things we judge trade equity and economic equity, there is a disparity
between the United States and Mexico. Stop and think that we passed
NAFTA giving that country some of the best trade benefits ever bestowed
by any government to any other nation or ally. We give, in fact, those
trade benefits to Mexico and we ask very little in return. In fact, we
have almost a $16 billion trade deficit, and our trade deficit in the
United States and I plan to hold a hearing on this issue because it is
another issue that has not received the adequate attention or concern
by the Congress or its appropriate committees, but the deficit has now
ballooned. It is in orbit, the highest it has ever been, trade deficit.
That is, the United States is buying more foreign goods than selling
those goods. Only for so long can the United States continue to have
this incredible hundred billion dollars in excess flowing out year
after year from the policies of this administration, but that is one
more benefit that we gave to Mexico and they are benefitting by the
trade surplus that they experience in selling us their goods, again,
produced at a different level. So all of these benefits are given to
the country of Mexico.
In return, we ask very little and, in fact, we go through this
certification process every year to say who is helping us and who is
not assisting us and should they get trade foreign assistance benefits.
That brings me to the topic that I wanted to raise tonight, and that is
the question of certification of Mexico and what is going on with our
Mexican allies.
Are they cooperating? I just read the quote by Tom Constantine, who
is the Director of our Drug Enforcement Agency, very harshly critical
of what is going on in Mexico. Two years ago, this Congress stumbled
and part of it was because of Wall Street weighing in. They were
concerned with this big trade agreement, that there might be some
repercussions and American businesses have now invested in Mexico and
the interconnection of these economic relationships by decertifying
Mexico there could be some implication, and they extended the real
meaning of decertification and have since, with the cooperation of the
administration, turned this into a political process rather than a
policy process of this Congress and how it extends benefits to other
countries. Again, those benefits trade financial assistance and
economic benefits in regard to international organizations. So that has
been distorted and the process is distorted.
Two years ago, this Congress concerned about the certification of
Mexico at that point, passed a resolution and asked Mexico to do
several things to help end this war, if it was to be a joint war, but
to take certain very specific actions but not unreasonable requests to
deal with the narcotics problem that was just as bad then as it is
today. In fact, it has gotten worse today as a result of nothing being
done by Mexico to address the specific concerns of this Congress.
Many people who were here several years ago remember what we asked
Mexico to do in a cooperative fashion. First we asked for extradition
of Mexican officials who were involved in drug activities. We asked for
extradition of the drug traffickers who were charged and we asked for
the arrest in Mexico, by Mexicans, of major drug traffickers. So we
asked for extradition of those who were involved in illegal narcotics
activities at the highest level, major drug traffickers; and we asked
for, again, cooperation in trying to bring under control some of the
corruption that existed in Mexico at various levels of their
government.
A second thing we asked for was Mexico to sign a maritime agreement
with the United States. A maritime agreement is important because if we
look again at this chart we can see the drugs travel not only overland
but also through some of the water areas that surround Mexico, and
United States officials and United States enforcement officers who work
off of this coast, in even our military, have no rights, no maritime
agreement. Mexico is the only country in this region with which the
United States does not have a maritime agreement except, I believe,
Haiti.
The only reason we have not had one with Haiti is because the
administration has done such a great job with their system of justice
down there, where we spent three or four billion dollars, and the
parliament has not met and we have had basically a dictatorship that
refuses to operate in a legitimate fashion. So we have a parliament or
a Congress in Haiti that basically has not been able to meet and
approve a maritime agreement, but that is not the case in Mexico, even
though what has happened in Haiti in not signing an agreement with the
disorganization of their government, with the pouring of billions of
U.S. dollars into that pit, we have a different situation, a different
set of circumstances with Haiti and that failure as opposed to the
Mexican record of failure and failing to sign or come to terms on a
maritime agreement. That is number two.
We asked for radar in the south. Now, of course, if we just look at
this chart again we see that the drugs are coming in through Mexico
through the southern border and transiting through their country. A
simple request still not adhered to.
The fourth request was to enforce some of the laws that had been
passed. Now, we did get Mexico to pass some tougher laws several years
back, but it is nice to have a law. The question is enforcing the law.
What happened when we asked for cooperation? Last year, our agents
uncovered an incredibly large activity relating to money laundering in
Mexico. The scope of it was mind-boggling and hundreds of millions of
dollars being laundered through Mexican banks. We arranged for a sting
operation and Mexican banks customers were arrested. What did the
Mexicans do? Did they cooperate with us, enforcing the law as we had
asked 2 years ago in money laundering and corruption? No, they did not.
In fact, the Mexicans had the audacity to blast the United States and
then threaten to indict our Customs officials. This is an operation
known as Casa Blanca.
So here again was another item, the fourth item that we had asked for
cooperation from Mexico; two years ago, and the situation is worse than
it was then.
An additional item that we asked for, a simple request, was our
agents, our DEA agents who work around the world, particularly where
there are international narcotics problems and they are welcomed by
most host countries. What did Mexico do to a request that they secure
protection, they allow our agents to arm themselves and that we also
increase the presence of those agents in that country for the purpose
of conducting investigations with Mexican officials? What they did was
really take little or no action. We still have a cap on those agents
and our agents still do not have the protection they need.
So these are a few of the basic requests this House of
Representatives asked Mexico 2 years ago to comply with to assist us.
[[Page H1328]]
{time} 1830
Again, nothing, at most very little, has been done.
What disturbs me the most about the situation with Mexico is that
instead of getting better on any front, the situation becomes worse and
worse.
Tonight, before the House of Representatives, I am going to read most
of the article that appeared in today's New York Times, and I ask every
Member of Congress who tomorrow will receive a copy of this article
from me to take time to read this article.
We have been concerned about corruption in Mexico at the highest
levels. We have been concerned that this administration made decisions
about certification not based on facts, not based on intelligence
information, but based on diplomacy and also in trying to protect
United States officials which I believe have covered up a horrible
situation. This article that I am going to read tonight that appeared
in The New York Times by Tim Golden, again I refer to every Member of
Congress and ask that they pay particular attention to its contents,
because its contents is very damaging to what has taken place regarding
Mexico.
Mr. Speaker, let me, if I may, read this. I will try to read most of
the article. I think again it deserves our attention, and it was
written today. This is not something that is dated.
``Early last year as undercover United States Customs agents neared
the end of the biggest inquiry ever conducted into the illegal movement
of drug money, bankers working with Mexico's most powerful cocaine
cartel approached them with a stunning offer. The agents, posing as
money-launderers from Colombia, had insinuated themselves deeply into
the Mexican underworld, helping the traffickers hide more than $60
million. Now moneymen working with the cartel said they had clients who
needed to launder $1.5 billion more. The most important of those
clients,'' they said, now listen to this, ``was Mexico's Minister of
Defense.
Mr. SOUDER. Mr. Speaker, will the gentleman yield?
Mr. MICA. Mr. Speaker, I would be glad to yield to the gentleman from
Indiana.
Mr. SOUDER. Mr. Speaker, I think it is important to point out in
looking at this article that ``early last year'' means this is around
the time we were about to certify Mexico as cooperating, and I think
that is really important. The gentleman called my attention to this
article. This is not something that is historic; this is something that
was happening while on the floor of this Congress. We had Members down
here saying they were cooperating, and that is important, I think, in
the context of what the gentleman is reading here. This was going on
while we are here saying, oh, things are going fine.
Mr. Speaker, I thank the gentleman for yielding.
Mr. MICA. Mr. Speaker, I thank the gentleman from Indiana not only
for his comments, but also for his continued interest in trying to
bring to the attention of the American people the situation relating to
Mexico's involvement in this drug matter.
Again, the point being here, these drug dealers said that they had a
client who needed to launder $1.5 billion more. Most important, those
clients, one of those clients, they said, was Mexico's Minister of
Defense.
``The Customs agents didn't know whether the money really existed, or
if any of it belonged to the Minister, General Enrique Cervantes,
officials said. But having heard about American intelligence reports,
pointing to corruption at the high levels of the Mexican military, the
agents were mystified by what happened next.
``Rather than continue the undercover operation to pursue the deal,
Clinton administration officials ordered that it be shut down on
schedule several weeks later. No further effort was ever made to
investigate the offer, and officials said that prosecutors have not
even raised the matter with the suspects in the case who have pleaded
guilty and who are cooperating with authorities.''
Let me read this quote: ``Why are we sitting on this kind of
information, asked the former senior Customs agent who led the
undercover inquiry,'' and that agent was William F. Gately. ``It's
either because we are lazy, we are stupid, or the political will
doesn't exist to engage in the kind of investigation where our law
enforcement efforts might damage our foreign policy.''
So here we have the question of whether or not we should have, and
our officials should have, pursued this matter of corruption at the
very highest levels, and in fact, it may have been compromised for the
sake of damaging our foreign policy or our diplomacy, or our relations
with Mexico.
``Senior officials denied,'' and I will continue reading, that
foreign policy had influenced their decision to end the operation,
saying they had been moved primarily by concerns for its security. They
also emphasized that the agents had been unable to verify the Mexican
traffickers' claims.
``Other officials of the administration, which has based much of its
Mexican drug strategy on collaboration with General Cervantes, said
they were confident that he was above reproach. A spokesman for the
Ministry of Defense, Lieutenant Francisco Aguilar Hernandez, dismissed
the traffickers' proposal as self-serving lies.''
But now listen to this part of this story: ``But a detailed account
of the case, based on confidential government documents, court records,
and dozens of interviews, suggests that United States officials walked
away from an extraordinary opportunity to examine allegations of the
official corruption that is considered the main obstacle to anti-drug
efforts in Mexico.''
Basically, they walked away from the investigation.
``For nearly a decade, American officials have been haunted by the
spectacle of Mexican officials being linked to illicit activities soon
after they are embraced in Washington. And just weeks before the
Customs investigation known as Operation Casablanca'', which I referred
to earlier, ``which ended last year, administration officials received
intelligence reports indicating that the Mexican military's ties to the
drug trade were more serious than had been previously thought. But when
faced with the possibility that one of Washington's critical Mexican
allies might be linked to the traffickers, the official gave the matter
little consideration. They said they opted for a sure thing, arresting
mid-level traffickers and their associates, and at least disrupting the
money-laundering system that drug gangs had set up. To reach for a
general, they asserted, would have added to their risk with no
certainty of success.
``Obviously, it was a significant allegation, the Commissioner of
Customs, Raymond W. Kelly, said in an interview. But he added, there
was skepticism about it. Was it puffing? It just was not seen as being,
I wouldn't use the word credible, but it wasn't verified.
Quote: ``When senior administration officials announced the stink
last May, they took a triumphant inventory: The indictments of three
big Mexican banks and bankers from a dozen foreign banks and the arrest
of 142 suspects, the confiscation of $35 million in drug profits, and
the seizing of accounts holding $66 million more. The officials claimed
that the success was a result of a long-standing administration fight
against money-laundering. But Mr. Gately, who retired from the Customs
Service on December 31, said his investigation had run the gauntlet of
resistance from the start.
``The Justice Department, uncomfortable with cases in which
undercover agents laundered more money for drug traffickers than they
ultimately seized, was imposing new limits on the time that such
operations could run and the money they would launder, officials said.
And though the restrictions did not apply to Customs, a branch of
Treasury, Justice Department officials continued to play strong
skeptical roles in supervising cases throughout the government.
``One Federal official who spoke on the condition of anonymity
admitted that he had initially dismissed Mr. Gately's plan. `You're out
of your mind', the official remembered saying. Several colleagues said
it was the sort of response that Mr. Gately, 49 years of age, tended to
see as a challenge. A decorated former Marine who enlisted for service
in Vietnam at 17, he had already been at the center of several cases
that mixed internal struggle and public success. Friends and critics
described him in similar terms: Driven, sometimes abrasive, and usually
creative.
[[Page H1329]]
``After leading an investigation that revealed ties between the
Italian Mafia and Colombian cocaine cartels, Mr. Gately cowrote a 1994
book about the case, Dead Ringer, that cast him as a lonely crusader
surrounded by small-minded bureaucrats. `It is the story of one man who
refused to succumb to corruption,' the prologue reads, `who believed in
his oath and mission and the consequences he paid for believing in what
he was doing.'
``As the senior Customs drug investigator in Los Angeles, Mr. Gately
said he first heard from a confidential source in 1993 about an
important shift in the way that Mexican and Colombian drug traffickers
were converting cash into funds that could be freely spent. The source
said, `Traffickers were depositing their money with corrupt Mexican
bankers who sent it back to them in almost untraceable cashier's checks
drawn on American accounts that the Mexican banks used to do business
with in the United States.' Mr. Gately hoped his source could
infiltrate that system, collecting cash from drug wholesalers in the
United States, and wiring it to corrupt bankers in Mexico.
``The bankers would issue drafts for the money and Customs would
develop evidence against the suspects on both ends of the transaction.
Many Customs officials, however, doubted that the ruse would work. Drug
enforcement agents wanted to use the source in another case. Because
the man had a criminal past, one Federal prosecutor opposed using him
at all and threatened to indict him on a 10-year-old case. Even when
Mr. Gately was eventually able to recruit another undercover
intermediary, a Colombian known by the pseudonym, Javier Ramirez, he
and others, said a senior Justice Department official'', and this is
very important, ``Mary Warren, pressed him to limit the operation's
scope.''
So we have an official in the Department of Justice pressing him to
limit the scope of this operation.
``What she wanted to know was when was this going to be over,'' he
said of Ms. Warren, ``who declined to comment. What was our end game?''
Mr. SOUDER. Mr. Speaker, will the gentleman yield?
Mr. MICA. Mr. Speaker, I am glad to recognize the gentleman from
Indiana.
Mr. SOUDER. Mr. Speaker, one of my concerns when I read this article
and in listening to the gentleman go through this is that we on the
Committee on Government Reform, we have heard some of this type of
thing before, that the constant trying to limit investigations, trying
to cut it off, it is a very disturbing pattern that this administration
seems to have when they are investigating things that are very
uncomfortable regarding their policy.
It is not clear who and where this decision was being made by. We do
not know whether it is coming out of the White House or whether at the
top of the Justice Department; much like in the Indian casinos
investigation, whether it was in the data bank or whether it was in the
missing files. But it is amazing how we constantly hear people inside
the Justice Department saying that top officials were impeding their
investigation rather than seeking the truth.
{time} 1845
What is really disturbing here is that it is not as though as I
recall it was just the year before this, that their drug czar was
implicated and eventually had to come down. It was not like these were
kind of off-the-wall charges that had never happened before in the
Mexican government.
The gentleman from Florida has been establishing through this New
York Times article that, while this person is a very driven person, he
has established that he has some track record. This is a disturbing
pattern we are seeing.
In fact, the gentleman read one statement a little bit ago that was
also disturbing, because we often hear at the grassroots level, ``why
do you get the little guys and not the bigger guys?'' The gentleman
read a statement from this article that said that they were being
limited by the Justice Department because, if the cash that they were
having to do to move up the line was less than that they could actually
close on at given point, which means that, by principle, we are
defining we are only going to go for midrange if we cannot keep
levering the deal as we move up.
There are some fundamental questions here even as to how we approach
this and do we really have the goal in our Justice Department to go
after the top officials even when we have a strong tip. I think that,
to some degree, this gets confusing as we move with it, but this is
really disturbing, and I hope the gentleman from Florida will continue
reading this into the Record and people will get copies of this because
this is a fundamental at the heart of our policy right now in Mexico.
Mr. MICA. As they say in the mystery books, the plot thickens here.
Let me continue if I may to read this into the Record. ``In November of
1995, Colombian drug contacts introduced the undercover agents to
Victor Alcala Navarro, a representative of Mexico's biggest drug mafia,
the so-called Juarez cartel.
``The Customs agents, posing as money launderers from a dummy company
called the Emerald Empire Corporation, began picking up the Mexican's
profits and laundering them as planned.
``In February 1997, at meetings in Mexico, Javier Ramirez was
introduced to Mr. Alcala's boss. A few months later, the Customs source
found himself chatting by phone with the head of the cartel, Amado
Carrillo Fuentes.
``Over scores of meetings and million-dollar deals, the traffickers
grew more open about the official protection they enjoyed in Mexico,
law enforcement officials and government documents indicate.
``At one meeting in Mexico City on May 16, 1997, the traffickers took
along 16 federal police agents as bodyguards.'' This is again police
agents of Mexico acting as bodyguards for drug dealers. ``At another
meeting, a man who identified himself as an official of the Mexican
Attorney General's office picked up $1.7 million in cash, including
$415,000 that the undercover agents had carried to Mexico for the
cartel boss himself.
``During a later meeting in New York, Mr. Alcala told the agents that
like Mexico's drug enforcement chief, who had been arrested for
collaborating with the Juarez cartel,'' again let me interject an aside
here, much to the embarrassment of our United States drug czar who had
embraced the Mexican drug czar, and here he is arrested ``for
collaborating with the Juarez cartel, the Defense Minister, General
Cervantes, was in league with the competing Tijuana cartel.''
But here we have allegations about the Attorney General, the former
drug czar, and the Minister of Defense, and we have hundreds of
thousands of dollars, $1.7 million of cash being picked up by officials
of the Mexican government.
Mr. SOUDER. Mr. Speaker, will the gentleman yield?
Mr. MICA. Yes, I will be glad to yield.
Mr. SOUDER. Mr. Speaker, I thank the gentleman for yielding, because
what the gentleman just read here sounds eerily close to what happened
in Colombia, only here we even have more direct involvement with the
leaders in the government.
We have the drug enforcement chief, eventually who was proven guilty,
who was actually renting an apartment from the head of the Juarez
cartel while he was getting information from our government. The
allegation is that the defense minister who was involved in helping
bring down that cartel may be, we do not know this but this article is
suggesting that we failed to pursue this, may be involved with the
competing cartel just like the Cali cartel in Colombia helped bring
down the Medellin cartel in Colombia because they wanted to put a rival
out.
We have been hearing steadily on this floor and other bodies that the
fact one way we can tell Mexico is cooperating is they helped bring
down their drug czar. But what if, and we did not investigate this,
they brought down their drug czar because another faction was a part in
helping a different cartel?
I am not saying that is happening, but that is a really disturbing
charge, because we would be played, for lack of a better word, as
suckers in Congress if in fact we use as an argument for not doing
decertification something which actually was a setup for a more
powerful cartel.
[[Page H1330]]
Mr. MICA. Mr. Speaker, again the plot thickens here, and I want to
continue reading from this investigative piece in today's New York
Times.
``Customs officials said they remain skeptical of what the agents
heard, including the traffickers' claim that Mr. Carrillo Fuentes's
death in 1997 had actually been faked. But in December 1997, Javier
Ramirez invited Mr. Alcala to Colombia for an elaborately staged
meeting that seemed to raise that partnership to a new level.'' This
meeting here with these folks. Let me continue.
``At a heavily guarded hacienda overlooking Bogota, an operative
acting as Javier Ramirez's Colombian boss, Carlos, said he and his
partners had $500 million to launder,'' half a billion dollars to
launder. ``They wanted to know whether the Mexican bankers used by Mr.
Alcala's boss, Juan Jose Castellanos Alvarez Tostado, could help.
`` `Alvarez called us right back,' Mr. Gately recalled. `He said,
`Let me send you my very best people, and we will get it done.' ''
``On March 6, 1998,'' just about a year ago, ``Mr. Alcala arrived
with several businessmen at the tastefully furnished offices of Emerald
Empire in a Los Angeles suburb. This time the businessmen offered a
deal of their own.
``One of the men, David Loera, said he knew `a general,' who had $150
million in Mexico City to invest. Would Mr. Ramirez--who had told the
traffickers he owned part of a Nevada casino used to launder money--
care to help?
``Over the next six weeks, according to government documents,'' again
let me read this, ``over the next six weeks, according to government
documents and the accounts of Mr. Gately and several officials, the
deal was discussed in three more meetings and three more telephone
conversations involving Mr. Ramirez, the undercover agents and the
traffickers. All of the contacts were secretly tape-recorded and their
words transcribed, officials said.
``In one call, two senior investment managers at Mexico's second
largest bank told the Customs operatives that the money belonged not
just to `a general,' but to the Minister of Defense. Later, the two
Mexicans advised Mr. Ramirez that the minister was sending `his
daughter' (a woman later said to be friend) to meet with them, along
with an army colonel and a third person.
``However, the investment managers said, the amount to be laundered
was much more than they had discussed: the minister had $500 million in
cash in New York and another $500 million in the Netherlands, in
addition to $150 million in Mexico City.
``Customs officials said they queried the Central Intelligence
Agency, which works closely with the Mexican military on drug control
and other programs. The CIA responded that it had no such information
about General Cervantes, an assessment that other officials have since
reiterated.
``But although General Cervantes has not been a focus of suspicion,
Mexican and American officials have said several senior generals close
to him had been under the scrutiny of investigators from both the
Mexican Attorney General's office and a special military intelligence
unit.
``On February 6, analysts at the Drug Enforcement Administration
briefed Attorney General Janet Reno on intelligence indicating that the
senior Mexican generals might indeed be cooperating with Mr. Carrillo
Fuentes' organization, officials said. And in a separate Customs case
in Houston, undercover agents had been approached about laundering
millions of dollars for an unidentified Mexican Army general, officials
said.''
Now listen to this, and again I quote from this article, ``On April
9, Mr. Alcala visited Emerald Empire with a cousin, who had just
returned from Mexico with a message. The cousin `was very nervous about
the deal,' Mr. Gately said. `He said it could be very dangerous if it
got screwed up, because the money belonged to, `all of them, including
the President.' '' The President, here it says Ernesto Zedillo. Then in
parentheses, it says ``(A spokesman for Mr. Zedillo, David Najera,
dismissed the claim as baseless.)''
``Later that month, Mr. Gately went to Washington to brief officials
including Mr. Kelly--who was then about to take over the Customs
Service after having overseen it as Treasury Undersecretary for
Enforcement.
``Kelly said, `How do we know it's really him?' Mr. Gately recalled,
referring to General Cervantes. `I told him we do not know,' Mr. Gately
said. `We cannot substantiate it. But we have no reason to believe that
they are telling us anything than what they know.'.
`` `They weren't trying to impress us, they were not trying to make
deals with us,' Mr. Gately added. `So whoever had this money, I thought
it was worth pursuing--whether it was the Defense Minister of Mexico or
somebody we had never heard of.'
``People familiar with the discussions said they did not go much
further. The general's supposed emissaries were to meet with Javier
Ramirez in Las Vegas, Nevada on April 22. They did not arrive, and the
traffickers reported they had become nervous.
Mr. Kelly acknowledged that he had been pressing for months to wrap
up the investigation; he said he had grown increasingly concerned that
information about it might be leaked out, endangering the undercover
agents.
``The final sting had already been postponed twice because Federal
prosecutors were still preparing indictments.
``James E. Johnson, who succeeded Mr. Kelly as Undersecretary and has
closely supervised the Treasury's relations with Mexico on enforcement
issues, added a cautionary note that several officials said seemed to
underscore his concern for the political stakes. Unless the agents had
proof of general Cervantes's role, officials quoted him as warning,
they should not bandy his name about in connection with the case.
`` `We need to be very careful about how we talk about this sort of
thing,' a senior law enforcement official, who would not speak for
attribution, quoted him as saying. `If we don't have the goods, it
makes us look like we're overreaching.'.
``Mr. Johnson would not comment publicly.''
``The operation had already navigated a series of sizable obstacles.
``Mr. Gately and some other agents were worried that their boss in
Los Angeles, John Hensley, had leaked information about the secret
operation to congressional aides and others; Mr. Hensley had also
pressed hard to bring the operation to an end, officials said.
``For his part, officials said, Mr. Hensley had accused his strong-
willed subordinate of transgressions ranging from traveling without
authorization to stealing millions of dollars. Mr. Kelly alleged that
the charges against Mr. Gately had been investigated and found
baseless; Mr. Hensley declined to comment.''
{time} 1900
``As discussions about this supposed $1.15 billion were going on, the
undercover operation also suffered serious setbacks with the capture of
an important Juarez operative in Chicago. The arrest brought money
deliveries to a halt while the cartel hunted a mole.
``On May 16, more than two dozen Mexican traffickers, bankers and
other operatives, who had been invited to the United States by the
undercover team, were rounded up in San Diego at the Casablanca Casino
Resort in Mesquite, Nevada. Officials said whatever thoughts they had
entertained of pursuing the allegations about General Cervantes were
dropped in the diplomatic backlash that followed.''
And, again, I told my colleagues what the Mexicans did is they
threatened to indict United States Customs officials.
``While the Mexican authorities were asked to arrest about 20
suspects indicted in the case, they initially located only 6. One was a
partner of Mr. Loera, the fugitive businessman who had first proposed
the deal with `the general'. The partner was found dead in a Mexican
jail from injuries that the police described as self-inflicted. Mr.
Alvarez Tostado has never been found. His deputy, Mr. Alcala, awaits
trial in Los Angeles.
``Soon after the operation, American officials said they revealed to
the Mexican government some of their information on ostensible
corruption in the case. They said they kept silent about more explosive
evidence to avoid intensifying the furor that had followed their
decision not to warn Mexico about the operation.''
And this is the Casablanca operation.
[[Page H1331]]
``Still, the officials said none of the information was ever pursued,
and in a little-noticed statement in July, the office of the Mexican
Attorney General, Jorge Madrazo Cuellar, dismissed allegations of money
laundering by `senior commanders of the Army and officials of the
Mexican government.'
``Mr. Madrazo said in a telephone interview that the Americans had
told him only about unidentified Federal agents and a money laundering
scheme involving `a general who had a daughter'. He said the name of
General Cervantes, who has no daughter, was never mentioned.
``With the information that they gave me, Mr. Madrazo asked, what
could I possibly have done, gone and looked for a general with a
daughter?''
And that was the response that we have out of the Attorney General
and other officials of Mexico. So, basically, what this article
outlines, and I read it in haste, but I wanted to make sure it was
included in the record, what this article and this investigative report
outlines is, in fact, we may have corruption at the very highest levels
of the Mexican government.
This information is now public. We have known that there was very
high levels of corruption. Here there are serious questions raised
again that lead to a high minister's office all the way to the office
of the President of Mexico.
We also see in this article a situation in which it appears that high
United States officials stopped this investigation when it was
disclosed that this corruption reached both the top of Mexican cabinet
officials and possibly even reached the office of the President of
Mexico, President Zedillo.
We also have here evidence tonight that the Mexican military, with
whom the United States is confiding with in the war on drugs, is
corrupt from the bottom to the very top. We must know who those
generals are that are hoarding this kind of money in such an incredible
fashion.
What else do we know? Those who reveal the truth about corruption in
the Mexican government are found dead, and United States officials who
attempt to reveal the truth about corruption are either deterred or
they are penalized or they come under close scrutiny.
What else have we learned from this investigative report? United
States officials, including the Attorney General, Secretary of State,
and others may be risking our national security. And if we are losing
14,200 Americans from the effects of illegal narcotics, and 60 to 70
percent of those hard drugs are coming through Mexico, we know we have
a national security problem of a huge proportion.
The information revealed by this New York Times report deserves
further investigation. As chairman of the Subcommittee on Criminal
Justice, Drug Policy and Human Resources of the Committee on Government
Reform, I intend to investigate it. We will not be deterred in seeing
how high this corruption leads to in the Mexican government. Wherever
it may lead us, we will follow it, and we will find out why officials
of the United States Government brought these investigations either to
a close or did not pursue adequately these investigations with
incredible allegations of this magnitude.
We will conduct those hearings and those meetings either in public or
behind closed doors.
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