Bal Harbour to Caracas: Millions in drug money
In a state seized by a dramatic surge in drug dealing, Bal Harbour police were about to take their controversial sting operation far outside Florida.
After weeks of delivering drug money to Miami storefront businesses, a new deal unfolded thousands of miles away in a country where the war on drugs had shifted: Venezuela.
Instead of enlisting the help of federal agents, the officers from the small community embarked on a series of laundering arrangements that were never revealed to the federal government.
For two years starting in 2010, they funneled millions in drug money into the bank accounts of Venezuelans, including William Amaro Sanchez, now special assistant to President Nicolás Maduro. The stated goal: to disrupt criminal groups.
They sent drug money to a well-known trafficker, a cash smuggler and a money launderer — more than $4 million in all.
In spite of U.S. warnings about the emergence of the country as a major hub for cocaine, the police never investigated the people to whom they were sending millions in drug proceeds, including a host of individuals with criminal records.
“They had no authority to do what they were doing,” said Felix Jimenez, former chief inspector of the Drug Enforcement Administration. “They were just lucky that when they were picking up all this money, nobody got killed.”
Federal agents for the U.S. attorney’s office in Chicago are investigating the money laundered by the Tri-County Task Force, a partnership between Bal Harbour and the Glades County Sheriff’s Office, including $2.4 million kept by the police for brokering the deals.
But the latest revelations about the task force’s foray into a country known as a hub for trafficking is expected to bring more federal scrutiny to a unit that veered far from its borders without any supervision by prosecutors, records show.
“It’s absurd. You’re a Bal Harbour police officer, your jurisdiction is local,” said Jimenez, the former chief DEA agent in New York. “They were just laundering money for the sake of laundering money.”
Tom Hunker, the former Bal Harbour chief who resigned under pressure in 2013, has declined to comment.
The Miami Herald examined hundreds of confidential records of the task force, as well as emails, bank records and Venezuelan passports, and found at least 20 people from the South American country who were sent drug money.
At every turn, the officers — working from a rented trailer — turned an undercover sting into an international operation that broke every provision of undercover work to bring in laundering deals.
The first payments started like the others: Officers traveled to New York to pick up drug cash. Instead of sending the money to Miami export shops — the local targets — they were directed by money brokers to wire the dollars into Panama banks.
Again and again, the police sent money in a flurry of transactions. In one deal, the police picked up a black duffel bag filled with hundreds of thousands in Rhode Island in May 2010, with directions: Move the money overseas.
Among the recipients: Willam Amaro, the 48-year-old assistant to Maduro, a longtime friend who was then the foreign minister under President Hugo Chávez. Amaro’s take: $45,000, according to records reviewed by the Herald.
The next day, they did it again. After collecting a red suitcase stuffed with cash in New York, the cops received an email to wire the money to several people living in Venezuela, including Amaro. This time, he was sent $37,000, records show.
Four more times, the cops wired money to Amaro’s account — $211,000 in all — but at no point did they alert federal authorities before sending the funds nor did they conduct a background investigation of him, according to interviews and Justice Department records.
Making the payments all the more remarkable: The U.S. government was then conducting investigations into Venezuelan government leaders involved in the drug trade, especially the criminal groups using the nation as a shipping point. U.S. studies show 24 percent of all the cocaine produced in South America is sent from Venezuela, often with the help of the military.
Amaro, long considered Maduro’s trusted advisor from when they were union workers in the 1990s, did not respond to interview requests.
For years, the two men have been inseparable, joining the revolutionary movement that swept the nation under Chávez. Amaro rose in stature as his mentor, Maduro, became foreign minister in 2006 and eventually, president after Chávez’s death in 2013.
The overseas deals took place just as the Venezuelan government was cracking down on the amount of U.S. dollars that could be collected each year by citizens, prompting many to turn to the black market.
The task force tapped into the demand in a rush of nearly one laundering deal every week — $1 million to people in the first three months.
One of the recipients: Rodolfo Rashid Velasco Kassem, a well-known Venezuelan tied to one of the largest drug cartels in the hemisphere, federal court records state. While he was sent more than $100,000 by the Florida cops, he was helping to move cocaine for David “El Loco” Barrera, the last of the Colombian drug lords.
The 42-year-old Velasco held ownership in a car dealership, three airplane hangars, boats, guns, and a seven-bedroom mansion in Barquisimeto, Venezuela’s fourth largest city. He was ultimately charged in Venezuela with money laundering and running a criminal enterprise.
Most of the overseas deals followed a similar route: the drug money was wired to correspondent banks and then moved to Banesco in Panama, a Venezuelan bank.
At least three times, money was wired to David Habib Hannaoui Babik, 49, another noted figure in Venezuela who was under investigation for money laundering and engaging in a criminal enterprise. His total haul: $212,000 in 2010.
In sending drug money to Hannaoui, Florida police were actually working counter to investigators in his own country, who were trying to stop his criminal enterprise, Jimenez said. “They facilitated a money-laundering operation,” he said. “It’s the stupidest thing I’ve ever heard.”
Two years later, Hannaoui was arrested after Venezuelan police raided his penthouse and found $1 million in cash, wire receipts, two money counters, Rolex watches, and records of 31 shell companies that he formed, records state.
In the largest case, the police sent millions to Fabian Cedeno, 40, and his brother, Jonathan, 30, in a dizzying series of payments just a few years after the older brother was arrested in Miami for smuggling undeclared cash through airport customs. He was sentenced to six months in prison in the case in 2007.
In one deal, the Bal Harbour police picked up a large bundle of drug cash in San Juan and later sent the money to the Cedenos in nine separate payments totaling $457,167. The police kept the rest of the money for setting up the deals.
In all, the task force sent the Cedenos $2.5 million in at least four dozen payments, but never opened a case. In doing so, the police violated strict federal bans on sending illegal money overseas, said Jimenez, now a law enforcement consultant with Idea International Group in Miami.
Jimenez said only the Justice Department can allow law enforcement agents to wire drug money into other countries. “They should have known better,” said Jimenez, once the third highest ranking DEA member. “Who gave them the authority?”
He said the police failed to follow established practices by not investigating the backgrounds of the people getting drug money. To this day, it’s not clear whether they even knew Amaro’s history, or that he was a close advisor to Maduro.
The larger issue is the missed opportunity to investigate someone emerging as a behind-the-scenes power broker to a future president, said experts. Amaro had been a member of Maduro’s inner circle from the time the latter was running for a seat in the Venezuelan Congress.
When Maduro became foreign minister, Amaro was frequently outside his office, deciding who could see the foreign minister, acting “as Maduro’s right-hand-man,” said a former Venezuelan intelligence agent who spoke to the Herald on the condition of anonymity. To this day, Amaro is the person who’s “most frequently assigned to handle personal, sensitive or potentially embarrassing matters” for Maduro, the agent said.
Just last month, two nephews of the president’s wife were arrested in Haiti on charges of conspiring to ship 800 kilograms of cocaine into the United States. The drugs were to be shipped from Venezuela, court records stated.
Federal agents might have been in a better position to understand the depth of the president’s knowledge of the drug trade if the police had probed Amaro and shared critical information with federal agents, say experts.
“He was a politically exposed person,” said Michael McDonald, a trial consultant and former U.S. Treasury agent. “He was in a position to know high-ranking officials in Venezuela …”
The money sent to him by the cops might have been for “buying and selling U.S. dollars” on the black market, said McDonald. Or “it could have been a payoff. It may well have been political corruption at the highest level.”
Joseph Fitzpatrick, a spokesman for the office of Chicago federal prosecutor Zachary F. Fardon, declined to comment.
One South Florida lawyer who specializes in money-laundering cases said the police were operating so far out of their realm, they were incapable of carrying out an international investigation.
“I can’t think of a more podunk town than Bal Harbour — not in a bad way. But in the sense that these cops would have otherwise been stopping traffic or shooting radar,” said Ruben Oliva, who has represented alleged narco-traffickers since the 1980s. “In reality they were being launderers. The minute they started doing busts, it would have been over.
“This is like a movie. You’ve got these guys and they’re flying all over. They’re saying, ‘Hey, I’m in the big leagues.’ I’ve seen every kind of law enforcement money-laundering investigations. I’ve never seen anything like this. It’s really one for the ages.”
Miami Herald | BY MICHAEL SALLAH AND ANTONIO DELGADO