pleaded guilty - San Antonio Express-News

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 150180 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 codefendant 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 1214 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. Agents arrested four workers at the stash
house and then arrested Flores in Laredo the following
morning.
17. VALDEZ continued his operations in Mexico after takedown of the
Atlanta wiretaps. In approximately 2008, the Beltran brothers had a
disagreement with Guzman and the Sinaloa Cartel, and they established
their own operations, known as the Beltran-Leyva Cartel. VALDEZ
continued his close association with Beltran, as well as his partnership with
Montemayor. His organization continued to receive ship1nents of cocaine
from Colombia, delivered by submarine, airplanes, or fast boats to Costa
Rica, and arranged for the delivery of the cocaine to customers in the
United States.
18. In December 2009, Beltran was killed during a firefight with a unit of
the Mexican Navy. Mexican authorities continued searching for VALDEZ
and located him on several occasions, but he eluded capture until his arrest
by Mexican Federal Police on August 30, 2010, at a ranch he owned near
Mexico City. He provided a videotaped statement to Mexican law
enforcement in which he ad1nitted to exporting cocaine to the United
States, among other things.
19. To establish these facts, the government would introduce at h·ial,
among other evidence: (1) lawfully intercepted telephone conversations
between Hector Flores, Romero Martinez, other workers in Atlanta, and
supervisors in Mexico, including Carlos Montemayor, Ruben Hernandez,
and Roberto Lopez; (2) testimony by other conspirators who would
identify VALDEZ and describe the events summarized in this staten1ent;
(3) surveillance by special agents and police officers of the operations of the
Atlanta workers at two different stash houses in the summer and fall of
2005, and (4)
seiz~d
cocaine, money, and records that would corroborate
the interceptions and cooperator testimony.