United States V. Edgar Valdez- Villareal Plea Hearing - Factual Basis If This Case Went to Trial, the Government Expects That It Would Offer the Following Evidence
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United States v. Edgar Valdez- Villareal Plea Hearing - Factual Basis If this case went to trial, the government expects that it would offer the following evidence: 1. In May 2004 (the starting date of the conspiracy offenses charged in Counts One, Two, and Nine of the Indictment), Edgar Valdez-Villarreal was engaged in a partnership with co-defendant Carlos Monten1ayor based in Mexico that obtained cocaine fron1 Colombia, exported the cocaine to customers located in the United States, and received bulk shipments of United States currency from these customers. Among other cities, this partnership sent cocaine to customers in Atlanta, in the Northern District of Georgia, during the conspiracy period charged in the Indictment. 2. The government's evidence would show that Valdez's involvement in cocaine trafficking began much earlier. As early as 2000, VALDEZ began his drug trafficking as a m~rijuana distributor in Laredo, Texas, and he soon developed cocaine customers in New Orleans and Memphis. 3. Starting in approximately 2001, VALDEZ made com1ections with cocaine distributors in Memphis, Tennessee, and Mississippi, and began sending them shipments of 20 kilograms of cocaine every 3-4 weeks. VALDEZ was known to these customers as "Juedo," or "Mike." The quantities later increased to shipn1ents of 60-80 kilos, and ultimately to 150- 180 kilos per shipment. During this period, Valdez obtained his cocaine from distributors in the Laredo/Nuevo Laredo area. However, in 1 approxin1ately 2002-2003, the Gulf Cartel in Mexico pooled forces with its rival, the Zetas, to endeavor to control the drug trade in the lucrative Laredo corridor. In the face of rising safety concerns, VALDEZ and his subordinates departed Laredo and continued their operations in various locations in Mexico, most frequently in Monterrey, while he and his associates engaged in frequent skinnishes with the Gulf Cartel and Zetas for dominance of the Laredo corridor. 4. In approximately 2002-2003, VALDEZ formed a partnership with co defendant Carlos Montemayor, who had an infrastructure of trucks and drivers for transportation of cocaine obtained within Mexico to and across the United States border, with ultimate delivery to U.S. cities. Together, VALDEZ and Montemayor developed a network to transport the organization's cocaine across the border from Mexico into Laredo, and to process and smuggle cash proceeds back into Mexico. VALDEZ continued to obtain his cocaine from various sources in Mexico, although he dispatched a lieutenant to Colombia in order to develop direct sources there. ·To the members of his organization, VALDEZ was known as "La Barbie," in reference to his fair complexion and appearance. 5. During this period, VALDEZ n1et with Arturo Beltran-Leyva in Mexico City. Beltran was a high-level cocaine trafficker, and at that time he and his four brothers were associated with Joaquin Guzman-Loera, a.k.a. "El Chapa," and the then-e1nerging Sinaloa Cartel. In an effort to ingratiate himself with Beltran and benefit from his cocaine operations, VALDEZ delivered two prize horses and a trainer to Beltran's ranch. Beltran was favorably impressed with VALDEZ and invited VALDEZ to meet with him, and they eventually began doing business together. The government's evidence would include descriptions of numerous meetings between VALDEZ and Beltran in Mexico City, Acapulco, and at Beltran's ranch in Ixtapa De La Sol. 6. In early 2003 VALDEZ struck an agreement with Gulf Cartel kingpin Osiel Cardenas Guillen allowing him to continue to import cocaine through the Laredo corridor but paying a tax to the Gulf Cartel to do so. However, this agreement broke down after Cardenas' arrest in 2003, and Beltran advised VALDEZ to get out of Nuevo Laredo once again because of instability within the cartels. 7. After 2003, VALDEZ and Monten1ayor continued their operations together, with VALDEZ benefiting from his close association with Beltran. VALDEZ and others continued to skirmish with the Zetas for control of the Laredo trafficking corridor, and he eventually assumed control of cocaine distribution for the Acapulco, Mexico, plaza. VALDEZ coordinated the importation of cocaine from Colombia and other South American countries using speedboats and airplanes, and paid bribes to local law enforcement officials. VALDEZ and his organization exported cocaine to Atlanta, Dallas, Memphis, San Diego, and Laredo. 8. In 2004, VALDEZ and Montemayor sought out a more formalized distribution organization for their cocaine customers in Memphis and Atlanta. Jesus Hector Flores, who is Monten1ayor's cousin and who had drug contacts in Memphis, agreed to coordinate the receipt and distribution of loads of cocaine delivered via tractor trailer truck to Memphis. Initially, the truckloads carried approximately 30 kilograms of cocaine, but they quickly escalated to shipments of 100 kilograms or more. In the spring of 2005, at Montemayor's request, Flores established a second base of operations for the organization in Atlanta. 9. In both Memphis and Atlanta, Flores recruited workers to establish stash houses, and these individuals worked full time in the operations of the cocaine distribution organization. The workers met the tractor trailer trucks and offloaded shipments of between 100 to as much as 300 kilograms of cocaine, usually every week but sometin1es every other week and sometimes twice a week. The workers parceled the cocaine and conveyed it to customers, and accepted bulk cash payments which they processed and delivered to tractor trailer trucks heading back to the Mexican border. Eventually, the currency was smuggled across the border and remitted to the organization's supervisors in Mexico. In Atlanta alone, the organization distributed a total of 1,500 kilogrmns of cocaine in just six months. 10. During the 2004-05 time period, VALDEZ established a Colombian source of supply for cocaine. VALDEZ had nun1erous meetings with this source in Mexico, including several meetings with the source and Beltran at Beltran's ranch. The source then became VALDEZ's primary source of supply for cocaine, and the sizes of the loads of cocaine received in Mexico increased dramatically. For example, on one occasion the source sent a load of 3,000 kilograms to Acapulco by fishing boat. VALDEZ kept 300 kilogran1s of this load, for which he paid between $7,500 and $8,200 per kilogram. All 300 kilograms were sent to VALDEZ's customers in Atlanta and Memphis. 11. VALDEZ later received regular shipments from the source of 600-700 kilograms if he shared the cocaine with Montemayor or others, or he received 250-400 kilograms if only for his own custo1ners. VALDEZ coordinated much larger loads with the source, sometimes as much as 12- 14 tons of cocaine, but these loads were split with many others in addition to VALDEZ. 12. VALDEZ's organization also received shipments of weapons, including AK-47s, AR-15s, pistols, M-16s with grenade launchers, night vision equipment, 50-caliber rifles designed to be mounted on vehicles, body arn1or, and rocket-propelled grenades. 13. Upon receipt of the profits from the previous cocaine sales, VALDEZ used the money to purchase additional loads of cocaine, and also spent the money on real estate and several small businesses. 14. On June 10,2005, DEA agents began intercepting the first in a series of court-authorized wiretaps of one of Montemayor's customers in Atlanta, which then led to wiretaps of Hector Flores and his workers in Atlanta. The intercepted calls revealed a particularly disciplined and regimented organization- the conspirators used military-like precision and orders, where nothing could be done without approval and consultation or instructions from the supervisors in Mexico. 15. Based on the wiretap interceptions, witness interviews, and other investigative work, agents ultimately determined that VALDEZ and Carlos Montemayor were partners~, supervisors, and the sources of supply · for the Atlanta organization. Ruben Herp.andez, also known as "Super" or "Secre," was VALDEZ's bookkeeper and logistics coordinator. Roberto Lopez, also known as "Shrek," was Montemayor's primary lieutenant and oversaw transportation, and Juan Montemayor, also known as "Vice," contributed his own U.S.-based customers and provided other support. VALDEZ and Montemayor each had their own customers for which they received personal proceeds, but they pooled their cocaine supply and used the same transportation and distribution network. 16. Wiretap interceptions established that, among others, the following specific deals and events occurred within the Northern District of Georgia: a. On July 18, 2005, the organization had 215 kilograms of cocaine in ~n Atlanta stash house. Monte1nayor instructed a worker named Romero Martinez to deliver 25 kilogrmns of cocaine to a customer and provided him with the customer's phone number. Martinez later reported to Montemayor that Martinez had contacted the customer and arranged to meet with him later. Montemayor instructed Martinez to charge this customer $16,000 per kilogram. b. On August 13,2005, the organization delivered 131 kilogran1s of cocaine to an Atlanta warehouse. In intercepted calls, Martinez spoke with a female h·uck driver concerning a h·uck that was to arrive from Texas. Later that evening, Flores called Martinez and asked hin1 to verify the count from the delivery. Martinez responded that he counted 131 kilograms of cocaine. Martinez asked Flores to pass the count along to Montemayor, because Martinez did not have the proper phone to contact Montemayor. c. On August 17-18,2005, agents seized $2.5 1nillion in cocaine proceeds collected by the Atlanta workers, and packaged in a tractor trailer truck for delivery to Texas and ultimately Mexico. Notes in the packaging identified that more than $600,000 of the cash was designated for VALDEZ. d. On November 11,2005, workers in Atlanta delivered 20 kilograms of cocaine each to two custon1ers of VALDEZ. e. On November 15, 2005, agents raided the Atlanta stash house located on Erin Road and seized 120 kilograms of cocaine and $1.5 million in cash.