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US designates Guadalajara’s Lucrecia Bar for money laundering

April 11, 2014
Lucrecia-Guadalajara

Guadalajara’s Lucrecia nightclub is allegedly a front for the Sanchez Garza money launderers.

The U.S. Treasury Department has designated Guadalajara’s trendy Lucrecia nightclub for laundering illicit funds for two of Mexico’s most wanted drug barons.

The bar was designated on April 10, along with nine real estate development companies, following a joint investigation by the DEA and the Treasury Department’s Office of Foreign Assets Control (OFAC). The businesses are all linked to the Sanchez Garza family, “a money laundering organization based in Guadalajara, Mexico that began operating on behalf of major narcotics traffickers Rafael Caro Quintero and Juan Jose Esparragoza Moreno (a.k.a. El Azul) in the 1980s,” OFAC said in a statement.

Six members of the Sanchez Garza family were designated under the Foreign Narcotics Kingpin Designation Act last June, while another five relatives were blacklisted on Thursday. “Today’s action prohibits U.S. persons from conducting financial or commercial transactions with these individuals or entities, and freezes any assets they may have under U.S. jurisdiction,” OFAC noted.

“Today’s designation targets those who hide behind seemingly legitimate real estate operations in order to support the illicit finance activities of drug trafficking empires led by Rafael Caro Quintero and Juan Jose Esparragoza Moreno,” added OFAC Director Adam J. Szubin. “OFAC will continue to investigate and uncover the ties between similar types of deceitful operations and money laundering networks.”

A founding member of the Guadalajara Cartel, Caro Quintero is wanted in the United States for the role he played in the abduction, torture and murder of DEA Agent Enrique “Kiki” Camarena in 1985. He was arrested and convicted in Mexico but was controversially released on a technicality last August, having served just 28 years of a 40-year sentence.

“El Azul” Esparragoza is another veteran drug trafficker who used to work with Caro Quintero in the Guadalajara Cartel. He has kept a lower profile over the years but is now believed to be leading Mexico’s powerful Sinaloa Federation alongside Ismael “El Mayo” Zambada, following the arrest of their partner Joaquin “El Chapo” Guzman in February.

OFAC-Sanchez-network

OSAC designated five new individuals linked to the Sanchez Garza family on April 10.

Located at Avenida Pablo Neruda 3085 in Guadalajara’s swanky Providencia neighborhood, Lucrecia is a popular hangout for the city’s large student population. The bar last made headlines in March 2013 when the head waiter was shot eight times after refusing to allow an unidentified assailant to enter.

This is not the first time that businesses related to Caro Quintero and Esparragoza have been designated for money laundering in Guadalajara and the state of Jalisco. In June 2013, OFAC imposed sanctions against 18 people and 15 companies that allegedly moved money for Caro Quintero. These included Barbaresco, a popular restaurant in Providencia, and Grupo Fracsa, the company behind the luxury Pontevedra and Zotogrande developments beside Avenida Acueducto in the upmarket Puerta de Hierro area. Another 20 local businesses and one other individual were then designated for laundering money on Caro Quintero’s behalf in October.

In July 2012 OFAC also designated nine entities and 10 individuals linked to Esparragoza, including several businesses run by members of his family in the municipality of Tlajomulco on the southern outskirts of the Guadalajara metropolitan area. Most notably, according to OFAC, Esparragoza’s wife Maria Guadalupe Gastelum Payan and their four children own the Provenza Residencial gated community and the adjacent Pronvenza Center shopping mall on Avenida Lopez Mateos.

The latest figure to be accused of laundering money for Esparragoza was Colombian-Mexican citizen Hugo Cuellar Hurtado, who was designated on February 27. According to OFAC, Cuellar formerly worked for Colombia’s infamous Medellin Cartel and then began supplying cocaine to the Sinaloa Federation in the late 1990s.

OFAC designated two Guadalajara pawn shops owned by Cuellar and a 57-acre ostrich ranch in Tlajomulco, where he recently welcomed a reporter from the New York Times in order to publicly protest his innocence.

The US State Department offers rewards of five million dollars for information leading to the arrest and/or conviction of Caro Quintero and Esparragoza. However, the latest designations may have little or no impact on their money laundering operations within Mexico as the local authorities have taken no apparent action against many of the businesses and individuals blacklisted in the past.

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