Mexico North – The extent of Mexican cartel influence in the United States   (November 19, 2011)

Here at PanAmerican Crime Mexico and its cartels are the subject of constant scrutiny and debate. With over 40,000 people murdered in Mexico since the blatant violence began in 2006, it is easy to see why Mexico’s cartels are obviously the most devastating and important organized crime element to understand when discussing organized crime anywhere on the American continents. While an adequate discussion of the tactics, alliances and history of these conflicts is essential to understanding Mexico today, it is also important to understand the effects these cartels are having on their greatest consumer market: the United States (US).

Popular American media accounts often take two perspectives when describing the influence of Mexican cartels in the US. The first and most sensationalized opinion takes the Lou Dobbs’ approach to this problem. In this line of thinking Mexico’s cartels have infiltrated every border police force from California to Texas, corrupting thousands of officials and waging blatant open warfare in the streets of every major US city. The second, more ignorant perspective rests on the old maxim – often applied to American Cosa Nostra and illegal biker gangs – that the criminal underworld exists outside of the normal American citizen’s experience, and will remain that way unless they actively move to involve themselves in the criminal underworld. Undoubtedly, the reality exists in that broad middle ground between the two schools of thought. However, while it is true that Mexican cartel influence is not close to destroying the legitimacy or efficacy of American state and federal governments, Mexican cartels do represent a very real threat, both physically and economically, to average Americans. The reason for this fact is not that Mexican cartel members are poised in every city to launch indiscriminate attacks on their rivals and the government, rather, that because of their tremendous wealth and organizational capacities, almost every major Mexican cartel has been able to embed itself within almost every sphere of organized crime in the US.

In order to understand the effectiveness of Mexican organized crime groups in the US today it is important to have at least a nominal understanding of the roles these groups play, the routes along which they transport their drugs into the region and, equally as important, how these groups withdraw the money from their illicit enterprises back to Mexico. After crossing the US border at key points, such as Ciudad Juarez, Tijuana and Nuevo Laredo, the massive drug shipments are sent to key transportation hubs, which include Phoenix, Dallas and, most importantly, Atlanta, Georgia. At these locations the large shipments are divided into smaller packages in local warehouses and sent to local criminal networks throughout the US; these local networks are still, at this point, Mexican cartel members. Once the drugs reach these regional transhipment points, such as Los Angeles, Chicago or New York, the local cartel cells again repackage the drugs for sale to criminal networks and large-scale drug dealers based in US cities. These networks are often organized criminal groups, however, the cartels are increasingly relying on street gangs to sell their drugs to the public. Once money is collected from the sale of the narcotics it is recollected at the key transhipment hubs, such as Atlanta, and smuggled back into Mexico through a variety of means. It is important to recognize the two flows of materials in this system. Mexican cartels will only ship their drugs north if they have a reasonable chance of receiving their money in return. In this symbiotic relationship the importance of the flow of cash back to Mexico cannot be understated and has defined the way in which Mexican organized crime has infiltrated the US over the past decade.

In terms of infiltrating the US consumer market the cartels often prefer to work with other Latin American criminal entities, although this is not always the case. Within the Californian criminal underworld the Sinaloa Cartel has forged ties with an organized crime group known as the Mexican Mafia, or Surenos. The Mexican Mafia control the prisons of southern California, and have controlling influence in many prisons throughout the US. Once considered just a prison gang, this group has extended its influence over the major street gangs throughout southern California, streamlining the drug trade and taking a controlling influence in the violence perpetrated by these often uncontrollable street-level organizations. Groups such as the notorious 18th Street Gang in Los Angeles and the 38th Street Gang now buy directly from suppliers obtained through the Mexican Mafia. The Sinaloa Cartel, which is based along Mexico’s western coasts, has now forged a working alliance with this group, providing drugs and recruiting sicarios (assassins) from among the Mexican Mafia’s most capable members. Los Zetas, considered one of Mexico’s most violent cartels, has similarly established a link with the Mara Salvatrucha (MS-13) street gang, which is similarly known for its brutality. Established by immigrants from El Salvador in 1990s in Los Angeles, this street gang is known to have members in almost every US state, where they sell drugs, commit acts of violence and control many areas in the poorer districts of the American urban environment. Most Mexican cartels have also established relationships with Puerto Rican, Dominican and other Caribbean drug trafficking organizations (DTOs), which have long operated in the major cities along the American eastern seaboard, the most important of which being New York City.

These direct connections to American Hispanic communities has allowed Mexican cartels access to street level operations that would have been unheard of for the Colombian cartels that operated similar smuggling networks throughout the US in the 1980s and 1990s. Colombian suppliers preferred to keep their relationships with their street-level distributors at least at arms-length. However, the importance of cash flow to the Mexican cartels has necessitated a more direct involvement in the narcotics supply chain in North America, which is the reason for their reliance on street gangs who the cartels consider to be much more controllable. Consequently, the Mexican cartels literally demonstrate their influence at every level of the drug networks they supply or operate.  The reason for this is simple: the continuing war between these cartel groups within Mexico.

When organizations with the wealth and geopolitical scope of Mexico’s contemporary cartels begin to combat one another over access points to the US the effects are immediate, bloody and have a major impact on these organizations’ ability to make and keep their money. As mentioned earlier, with over 40,000 people already dead as a direct result of these ongoing wars, the Mexican cartels have needed to guarantee their flow of money to continue to be able to pay for such costly conflicts. While it could be assumed that such a death toll merely lowers payrolls for these organizations, such an assumption would belittle the capabilities of these groups. Large cartels, such as the Sinaloa, Gulf and Los Zetas cartels employ thousands of people. Their combat capabilities include sophisticated weapons and technology, such as intelligence gathering, counter-surveillance and cyber detection. These groups also rely on vast sums of money to finance their political corruption campaigns, which allow the cartels to act with impunity in many Mexican states. Without the adequate cash to finance their weapons trafficking, pay for technological expertise and corrupt local and federal Mexican officials any cartel would soon find themselves at the mercy of the better funded organizations. Consequently, while drugs provide the bulk of wealth to Mexico’s cartels, the development of money laundering and effective cash smuggling techniques are the real engines of the Mexican conflicts.

In the 1980s and 1990s the Medellin and Cali Cartels made billions of dollars annually through drug smuggling into southern Florida, primarily in the Miami region. Consequently, the city of Miami changed forever. Murder rates jumped from a mere few dozen at the end of the 1970s to over 600 by the end of 1982, making Miami America’s murder capital for many years. In the case of modern Mexican cartels this has not yet been the case. However, as mentioned before, the Mexican cartels seek dominance throughout all levels of the drug supply chain, necessitating the use of violence throughout the US as a result. Consequently, murders, often perpetrated with the extreme levels of violence typical of Mexican cartels, have been committed throughout the American southwest as cartel members and their affiliated street gangs seek to control access to the crucial transhipment points within the US. Grisly murder victims have been found from Phoenix to Atlanta, with torture and other brutal tactics often employed. Yet while these murders are growing in number and represent a new level of brutality in American street gang warfare, they have not created a new “Miami-ization” in any particular US city. The reason for this is simple, the Mexican cartel leadership understands that while they can combat their rivals clandestinely in the US, any dramatic shock to the American public’s perception of their general safety will necessitate the immediate and overwhelming response of the American security apparatus. Meaning essentially that the cartels fear US involvement within their base of operations inside Mexico. The deaths and destruction in Miami during the 1980s and 1990s forced the US government to physically deal with the Colombian cartels, and the US military still maintains over 800 military personnel, including special forces units, within Colombia today as a result.

The other aspect of the Colombian infiltration of south Florida several decades ago was that the staggering wealth that these cartels generated was responsible for the glitz and glamour of contemporary Miami. Both the Medellin and Cali cartels used local money laundering schemes, including real estate investment and corrupt or apathetic banking officials to “clean” or launder billions of dollars. The result was the greatest construction boom seen in America since the turn of the 19th Century. Today it appears as if Mexico’s cartels are equally, if not more adept at utilizing US institutions to hide and transport their illicit gains. From 2004 to 2007 Wachovia, one the premier American banks, admitted to laundering at least 378.4 billion dollars for the Sinaloa Cartel, currently Mexico’s largest criminal entity. The bank admitted that the cartel was able to access accounts through casas de cambio, (exchange houses), which allowed the deposits and withdrawals to go largely untraced for years. What this should indicate is that if Mexico’s cartels can utilize the operations of one the biggest banks in America, they can undoubtedly find ways to manipulate many of the hundreds of smaller, less reputable institutions that can be found throughout America. These sophisticated money laundering operations are the life-blood of the Mexican cartels and are responsible for financing the ongoing conflict within Mexico. As of this point however, there is no indication of a cartel-induced real estate boom in places such as Atlanta, indicating that the Mexicans are far better than their earlier Colombian counterparts at getting their profits out of the US. However, while it is impossible at this point to determine how much illegally obtained capital is flooding the US banking and real estate sectors, the numbers involved are assume to be mind-boggling, as the near 380 billion dollars – which involved one bank alone – can attest to. And, more importantly, it is impossible at this point to say just how much corruption is present within US government institutions; although it would impossible to speculate, the amount of money involved makes such corruption inevitable at some level.

By the end of 2009 the American Drug Enforcement Administration (DEA) and Federal Bureau of Investigation (FBI) concluded operation Xcellerator, a two year long investigation of the Sinaloa Cartel within the US. This operation ended with the arrest of over 750 people as well as the seizure of hundreds of weapons, 60 million dollars in cash as well as tons of cocaine, marijuana, heroin and methamphetamines. While such arrests and seizures were unprecedented and would constitute a knockout blow to almost any other criminal organization, both the FBI and DEA believe that by 2010 the Sinaloa Cartel had completely re-established itself in the regions where it had previously been dismantled in 2009. The size, wealth and experience of Mexico’s cartels makes such a revival inevitable and it is impossible at this point to realistically determine how embedded such organizations are in the economies of the south-western US. Indeed, smaller American border towns may already be facing their own “Miami-izations” at this very moment.

Operation Xcellerator and the discovery of sophisticated money laundering schemes reveals the breadth and scope of Mexican organized crime within America today, making it clear that Mexican cartels are now thoroughly embedded in the criminal hierarchy and structure of American organized crime. They have succeeded in becoming a fact of life within the American criminal underworld rather than the interlopers they were seen as to begin with. And, while they continue to extract their cash with such success and efficiency from the US any chance of bringing the cartel violence in Mexico to an end or halting the flow of narcotics into the North American domestic market remains a pipedream. While not an impending national catastrophe in waiting, the importance of Mexican cartels within the contemporary American underworld, due to their sheer size and wealth, simply cannot be understated or overlooked. No single country has as much immediate ability to harm American citizens and the US economy as Mexican cartels do. And therefore, when looking at American involvement around the World, it becomes clear that Mexican organized crime groups represent the greatest political, economic and social challenge facing the United States today.

– Scott Paulseth, Editor, PanAmerican Crime


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