Is Jaquin "Chapo" Guzman Chicago's New Scarface?

Chicago’s new Scarface is a shadowy Mexican drug kingpin nicknamed Chapo — “Shorty” in Spanish. His cash crop is marijuana, which his cartel sells by the ton and protects with horrific violence.

If you thought Chicago’s Italian mob was the worst of the worst in organized crime, think again, federal agents say. “Chapo Guzman would eat them alive,” said Jack Riley, head of the U.S. Drug Enforcement Administration’s office in Chicago.

The 5-foot-6 Joaquin “Chapo” Guzman rules the Sinaloa Cartel, which allegedly smuggles marijuana and other narcotics in planes, trains, ships, trucks, cars and even submarines.

Most of Guzman’s leafy product comes from Mexico, but some is grown alarmingly nearby — deep in Wisconsin’s North Woods, whose pristine lakes and pine forests are a paradise for weekend campers, hunters and anglers. Authorities suspect much of that Wisconsin-grown pot is destined for here.

Although Chicago is in the U.S. heartland, in the marijuana trade, “We are on the Mexican border,” Riley said.

Mexican marijuana dominates the Chicago market at a time when local police and prosecutors are trying to devise a better way to deal with the tens of thousands of people arrested here every year for possession of small amounts of pot. Most of those cases get dismissed in court, so several Chicago aldermen recently proposed an ordinance to allow officers to write tickets for minor marijuana possession.

Whatever the outcome, police and prosecutors say they won’t stop trying to prevent cartels like Guzman’s from shipping their huge loads of marijuana to Chicago. “The Mexican cartels have totally taken over the majority of the marijuana trafficking here,” Riley said. “It’s their cash crop. It’s the drug that really allows them to do all of their other criminal enterprises: heroin, cocaine, methamphetamine. That’s why it’s so important to us.”

A man scouting locations to hunt bears near the Chequamegon Nicolet National Forest stumbled upon one of the Sinaloa Cartel’s secret North Woods marijuana operations. The hunter called authorities, who notified the DEA. A federal probe found about 10 grow sites that ranged in size from a suburban backyard to a football field in the forest and other remote areas of northern Wisconsin. Suspected cartel workers were tending to about 10,000 plants that would have been worth millions of dollars on the street. Twelve men were nabbed last year and all the plants were destroyed. Agents also recovered an AK-47 and other weapons.

These backwoods pot farms — first discovered about three years ago — are more sophisticated than what local cops there have encountered in the past. Trees were clear-cut to 3 feet high and marijuana was planted between the stumps. Workers dug water wells and ran irrigation hoses to the plants. The men slept and cooked under plastic tarps where they stored their pots and pans, sleeping bags, fertilizers, pesticides and trash. “Luncheros,” or supply workers, brought them food and growing supplies.

National Forest Service district ranger Jeff Seefeldt said he has suggested that fellow employees bring along law enforcement on visits to remote areas of the 130,000 acres of forest he oversees. Oconto County Sheriff Michael Jansen said he doesn’t know of any cartel-related violence in his community, yet. But he’s worried that other heavily armed marijuana grow operations might move into his backyard.

“The national forests in the mountainous states — Oregon and California — have been dealing with this for years,” he said. “They’re looking at a map and seeing other national forests besides those out West. And they’ve put their finger on Wisconsin.”

Mexican drug cartels are growing marijuana in the Chicago area, too, but on a lesser scale, said Larry Lindenman, executive director of the Lake County Metropolitan Enforcement Group. He suspects a cartel was to blame for a marijuana field found in 2008 in Waukegan across the street from property owned by Abbott Laboratories. “They had tents. They would work and live on the site. They even made a building out of plastic bags and used a generator-powered heater to dry the harvested plants before shipping,” he said.

The operations the feds have busted in Wisconsin and northern Illinois are proof Mexican cartels will grow marijuana anywhere they can to ensure an uninterrupted supply of marijuana makes it their best-selling markets, including Chicago.

Still, their local grow operations are a sideline — just a “small part of the pie” ­— in the drug business, Riley said.

In recent years, Chicago and Atlanta have become key transportation hubs for the cartels, Riley said. Most of their pot comes to Chicago in trains and semi trucks.

A lot of that marijuana is being shipped here by the Sinaloa Cartel and protected with unthinkable violence, Riley said. “Chapo Guzman, now that Osama is dead, is in my opinion the most dangerous criminal in the world and probably the most wealthy criminal in the world,” he said. “Guzman was in the Forbes Top 100 most wealthy people in the world. His ability to produce revenue off marijuana, we’ve never seen it before. We’ve never seen a criminal organization so well-focused and with such business sense, and so vicious and violent.”

In Mexico, feuding cartels are suspected of tens of thousands of murders, some gruesome beyond compare. They have been known to kidnap, torture, kill and mutilate. Here’s an example: The Juarez Cartel got blamed for what happened to a kidnapping victim whose skinned face was stitched onto a soccer ball in Sinaloa, Mexico, in 2010. Cartel members, including a hit squad called the Scorpions, are believed responsible for murders in Chicago, too, a police source said.

Fear of cartel violence, as well as rampant bribery, has prompted many officials in Mexico to look the other way while tons of marijuana and other drugs cross the border. But the cartel bosses aren’t just ruthless killers. They’re also businessmen who run their operations with a logistical know-how that rivals corporate giants.

Cartels have even secretly hired students attending elite U.S. universities to engineer their marijuana for increased potency, a police source said.

Vicente Zambada-Niebla, the alleged head of logistics for the Sinaloa Cartel, claims the DEA allowed the cartel to operate without interference for years in return for providing DEA agents with details about rival cartels, including the location of their leaders. He says the DEA offered him immunity in exchange for information, which the agency vehemently denies.

Zambada-Niebla, Guzman and their co-defendants are charged with smuggling tons of heroin and cocaine to Chicago and elsewhere in the U.S. Zambada-Niebla is in a federal lockup in Chicago, but Guzman remains a fugitive.

Although that federal case focused on cocaine and heroin, authorities believe the Sinaloa Cartel and rival drug cartels are also responsible for tons of marijuana that police and federal agents have seized in recent years. From 2005 through 2009, Chicago Police officers interdicted 29 tons of marijuana suspected of coming from Mexican cartels. In 2010 alone, police seized another 19 tons.

Last year, DEA agents in Chicago Heights stopped a delivery of nearly 11 tons of marijuana packed in six rail cars from Mexico. And in August, Chicago Police conducted surveillance on a West Side warehouse and saw workers preparing to move large containers from a tractor-trailer to six white vans. Hiding on rooftops and in weeds, the officers watched workers pull the six containers from the semi truck. Each container contained a ton of marijuana. Some bore the label “AK-47.”

“You will see people getting shot, being beheaded back in Mexico because of this,” said one undercover narcotics officer involved in the bust. “But for every truck you stop, 12 get through.”

The high season for shipping cartel marijuana to Chicago is in January, February and March — the key harvest times in Mexico.

Marijuana is often hidden under fruit or other food in a tractor-trailer. If a truck hauls a ton of pot to Chicago, the dealer who bought it from the cartel might earmark four 500-pound packages for particular customers. Once the truck is unloaded in Chicago, the weed doesn’t sit in a warehouse long — an hour or two, tops.

“Now it’s up to the independent dealers in the area with their own customer base that might supply the local guys with 50 pounds here and 50 pounds there,” an undercover narcotics officer said.

The cartels deal almost exclusively with high-level, Spanish-speaking smugglers in Chicago.

There are rules for how the pot is distributed here, authorities said. A guy who buys a ton won’t sell less than 500 pounds to anyone. A guy who buys 500 pounds won’t sell less than 50 at a time. And the guy who buys 50 pounds will “pound out” 5- or 10-pound amounts to his customers. At the bottom of the pot-dealer chain, low-level Hispanic drug dealers sell marijuana to the street corner salesmen who deal in ounces and grams.

“It’s Basic Narcotics 101,” said Chicago Police Cmdr. James O’Grady of the narcotics unit. “Don’t try to buy a kilo from a guy who sells ounces.”

A guy who sells ounces will think you’re stupid and rob you. Or he’ll think you’re an undercover cop and avoid you — or worse, O’Grady said.

Certainly, a pot dealer selling ounces would never negotiate with someone like Saul Rodriguez, a ruthless drug trafficker near the top of the supply chain in Chicago.

Rodriguez played a dangerous game. He ripped off the Mexican cartels and sold the drugs he stole. He has also admitted to being involved in the murders of three people.

In 1996, the former La Raza gang member became an informant for Chicago Police, earning $807,000 for his tips about high-level drug dealers.

Glenn Lewellen was the narcotics officer who recruited Rodriguez as an informant. They became partners in crime, federal prosecutors allege.

Rodriguez got his start as a big-time marijuana dealer before moving into more lucrative cocaine deals, law enforcement sources say. In 1996, for example, the DEA seized 154 pounds of marijuana from one of Rodriguez’s cars. But Lewellen persuaded the feds to drop their case, prosecutors said.

Rodriguez’s crew continued to operate until 2009 when he was arrested. He has pleaded guilty to running a drug enterprise and arranging the murders of three men in 2000, 2001 and 2002.

Riley, the head of the DEA here, said he thinks a lot of pot smokers are unaware the bag of weed they buy is directly connected to the violence and corruption of Mexican drug cartels and their local associates, Rodriguez among them. “The guy sitting on the patio in Hinsdale — smoking a joint with his friend and having a drink — better think twice,” Riley said. “Because he’s part of the problem.”

Thanks to Frank Main

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Chili Pimping in Atlantic City: The Memoir of a Small-Time Pimp and Hustler

Chili Pimping in Atlantic City: The Memoir of a Small-Time Pimp and Hustler is the controversial autobiography of Michael Mick-Man Gourdine, AKA the Candyman, as he was known on the street. The book pulls no punches and provides an honest and sometimes shocking look at what one man from the wrong side of tracks felt compelled to do to achieve the American Dream. Gourdine became a pimp who operated primarily on the streets of Atlantic City, New Jersey, while working as a corrupt NYPD cop who specialized in narcotics trafficking and prostitution. Employed as a police officer from 1990 to 2000, Gourdine reportedly made an estimated $2.5 to 3 million dollars in illegal graft, bribes, prostitution and drug dealing before being fired.

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Two Dozen Members and Associates of Belizean Bloods Street Gang Facing Federal Narcotics and Passport Fraud Charges

A federal investigation of alleged passport fraud and narcotics trafficking by members and associates of the Belizean Bloods street gang operating in Evanston and Chicago has resulted in charges against two dozen defendants, most of whom were arrested here this week, law enforcement officials announced today. One defendant, Jerry Johnson, who allegedly directed the Belizean Bloods drug trafficking organization in Chicago, was arrested yesterday in Salt Lake City and is facing federal charges in Chicago. Five other defendants were arrested, and three guns were seized, Tuesday afternoon in Lyons where they had gathered as part of an alleged conspiracy to rob what they believed was 50 kilograms of cocaine from a different drug organization but which, in fact, was a ruse in an undercover sting operation.

Overall, 10 separate federal complaints were filed and unsealed in U.S. District Court in Chicago after search and arrest warrants were executed Tuesday and yesterday, announced Patrick J. Fitzgerald, United States Attorney for the Northern District of Illinois. The charges arise from two coordinated investigations, Operation Blood Hound and Operation Black Orchid, which brought together agents from multiple federal law enforcement agencies, as well as the Chicago and Evanston Police Departments and other local partners. In 2009, the Chicago Field Office of the U.S. State Department’s Diplomatic Security Service began investigating alleged passport fraud by Belizean nationals, while at the same time the FBI and Evanston and Chicago police were investigating alleged narcotics trafficking by suspected members of the Belizean Bloods.

Previously, during the course of the investigations, bulk amounts of powder and crack cocaine, firearms and assault rifles and cash were seized. Eight additional Belizean nationals were prosecuted for passport fraud and eight others for illegally re-entering the country within the past year in Federal Court in Chicago. Another Belizean national was arrested yesterday in Chicago on passport fraud charges filed in the Southern District of Florida.

“These coordinated efforts demonstrate the commitment and teamwork of all law enforcement agencies in the Chicago area to combat the dangerous combination of gangs, guns and drugs in our community,” Mr. Fitzgerald said.

Mr. Fitzgerald announced the arrests and charges with Scott Collins, Acting Special Agent in Charge of the U.S. State Department Diplomatic Security Service Chicago Field Office; Robert D. Grant, Special Agent in Charge of the Chicago Office of the Federal Bureau of Investigation; Andrew L. Traver, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives in Chicago; Gary J. Hartwig, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) in Chicago; Alvin Patton, Special Agent in Charge of the Internal Revenue Service Criminal Investigation Division in Chicago; and Darryl McPherson, the U.S. Marshal in Chicago. The Chicago and Evanston Police Departments played significant roles in the investigation along with other local agencies. The investigations were conducted under the umbrella of U.S. Organized Crime Drug Enforcement Task Force (OCDETF), and with significant assistance from the High Intensity Drug Trafficking Area Task Force (HIDTA.)

The investigation, which is continuing, relied on undercover purchases of narcotics, surveillance, consensual audio and video recordings, and court-authorized wiretaps of telephone conversations, as well as information provided by multiple cooperating witnesses, including former members and associates of the Belizean Bloods.

According to the charges against Johnson and three others, Johnson’s sources of supply included quantities of narcotics from Belize. He allegedly directed the distribution of powder and crack cocaine and “cooked” powder cocaine to produce crack, which was distributed in wholesale quantities. A cooperating former Belizean Bloods member told agents that Johnson had inherited his father’s drug connections when his father was deported to Belize. The Belizean Bloods narcotics distribution route allegedly included Illinois, Utah, Ohio, Indiana, New York and California.

Johnson, approximately 30, of Chicago and Evanston, also known as “Kaiden Bennett” and “Kalvin Howell,” appeared in Federal Court in Salt Lake City and remains in custody pending a detention hearing tomorrow. Other defendants arrested yesterday in Chicago were scheduled to appear this morning before U.S. Magistrate Judge Arlander Keys in Federal Court in Chicago.

The five defendants arrested Tuesday afternoon in Chicago appeared before Magistrate Keys yesterday and remain in custody pending detention and preliminary hearings at 9:30 a.m. next Tuesday. Three of them, Myreon Flowers, 39, of Chicago, aka “Diesel;” Anward Trapp, 31, of Chicago, aka “Bernard Gillett,” “Herman Flowers,” and “Smash;” and Rudy Space, 30, of Chicago; were charged with conspiracy to possess and distribute cocaine for allegedly planning to rob a purported 50 kilograms of cocaine from a purported “stash” garage in Berwyn. The complaint alleges that they were involved in conversations and planning with an undercover agent and a cooperating witness to engage in a purported armed robbery, and shooting if necessary, of three members of a Mexican drug cartel on Tuesday. They were arrested at meeting spot in Lyons as they prepared to descend upon the fictitious stash location. (United States v. Myreon Flowers, et al., 11 CR 779.) Arrested with them were David Flowers, 34, of Chicago, and Duane Jones, 28, of Chicago, aka “Duane Tillett,” and “Dido,” who are facing separate charges of distributing crack cocaine, together with Myreon Flowers and Eric Burnett, 24, of Chicago. (United States v. David Flowers, et al., 11 CR 770.)

Summaries of the remaining cases follow:

United States v. Johnson, et al., (11 CR 763)

Jerry Johnson, together with Sheldon Morales, 30,of Wheeling, an alleged member of the Gangster Disciples street gang who supplied Johnson with powder cocaine; Douglas Wilson, 57,of Evanston; and Tyrita Myers, approximately 24,of Chicago; were charged with conspiracy to possess and distribute wholesale quantities of cocaine and crack cocaine between August 2010 and March 2011.

United States v. Ward, (11 CR 764)

Anderson Ward, 29, of Chicago, was charged with possession of crack cocaine with intent to distribute in March 2011.

United States v. Gentle and Ellis, (11 CR 766)

William Gentle, 30, of Chicago, and Richard Ellis, 18, of Evanston, were charged with conspiracy to possess and distribute crack cocaine between May and July this year.

United States v. Gadson and Walker, (11 CR 767)

Gilbert Gadson, 45, of Chicago, aka “Gilbert Gatson,” and Roy Walker, 52, of Chicago, were charged with conspiracy to possess and distribute crack cocaine in January and February this year.

United States v. Glen Flowers, (11 CR 768)

Glen Flowers, 40, of Skokie, aka “Glen Gillett,” “William Powell,” and “Herbert Williams, Jr.” was charged with passport fraud for attempting in December 2010 to fraudulently renew a U.S. passport in the name of Herbert Williams, Jr.

United States v. Gibson and Glen Flowers, (11 CR 769)

The same Glen Flowers was charged with distributing powder cocaine, and Harrington Gibson, 63, of Chicago, aka “Uncle Harry,” was charged with distributing crack cocaine on June 29, 2011.

United States v. Perez, et al., (11 CR 771)

Carlos Perez, 41, of Chicago; Alfredo Castro, age and residence unavailable; and Jonathan Vaughan, 26, of Chicago, were charged with distributing cocaine on Oct. 20, 2011.

United States v. Trapp, et al., (11 CR 772)

Anwar Trapp, together with Wilton Bennett, 29, of Chicago; Marlon Conorquie, 36, of Chicago, aka “Dread;” and Alix Aurele, 37, of Dolton, were charged with distributing crack cocaine or heroin in September and October this year.

The defendants are facing various maximum penalties on the narcotics charges, ranging from a maximum of 20 years in prison to mandatory minimum sentences of either 5 or 10 years to a maximum of 40 years or life in prison, together with maximum fines of $250,000, $2 million or $4 million. The passport fraud charges carry a maximum penalty of 10 years in prison and a $250,000 fine. If convicted, the Court must impose a reasonable sentence under federal sentencing statutes and the advisory United States Sentencing Guidelines.

The government is being represented by a combination of Assistant United States Attorney Jessica Romero, Meghan Morrissey, Christopher Grohman and Kate Zell.

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Todd Stark, Reputed Mob Associate of Nicodemo S. Scarfo, Pleads Guilty

A former bartender and reputed mob associate pleaded not guilty Wednesday to supplying boxes of bullets to mobster Nicodemo S. Scarfo, a convicted felon barred by law from possessing guns or ammunition.

Todd Stark, 43, of Ocean City, N.J., entered the plea during a brief hearing in U.S. District Court in Camden.

Stark is among 12 defendants indicted with Scarfo, 46, in a multimillion-dollar financial-fraud case. He is the only one not charged with involvement in what prosecutors allege was the systematic looting of the FirstPlus Financial Group, a Texas company that authorities allege Scarfo secretly took control of in 2007.

Stark, Scarfo, and five other defendants were charged with conspiracy to provide firearms or ammunition to a convicted felon.

Scarfo, who has been held without bail pending a detention hearing and arraignment Friday, also is charged with illegal possession of a weapon.

Most of the defendants have pleaded not guilty and are free on bail.

Others, including Scarfo, have not yet entered pleas.

The weapons charges, while not directly connected to the financial fraud, underscore allegations that the looting of FirstPlus was based, in part, on Scarfo's organized-crime connections.

Authorities allege that Scarfo, of Galloway Township, N.J., and defendant Salvatore Pelullo, 44, of Elkins Park, used threats of violence and their ties to the mob to intimidate officials with the firm and eventually take control of the company.

The 25-count indictment charges that proceeds from the scam, estimated at more than $12 million, were "distributed to members and associates of LCN (La Cosa Nostra)."

Pelullo, described by associates as a "wannabe wiseguy," is identified in court documents as an associate of the Philadelphia crime family formerly headed by Scarfo's father, "Little Nicky" Scarfo, and the Lucchese crime family in New York.

The indictment alleges that Scarfo and Pelullo kept a "cache of weapons."

They included two rifles, a shotgun, two pistols, a revolver, and more than 2,500 rounds of ammunition found on a yacht owned by Scarfo and Pelullo during an FBI raid in May 2008.

The yacht, christened "Priceless," was purchased for $850,000 by the pair with funds taken from FirstPlus, authorities said. Docked in Miami, it was used by the men and their associates to cruise the Bahamas.

It was seized by authorities during the investigation.

Authorities found a .38-caliber pistol in Pelullo's business office in Philadelphia; a .32-caliber pistol in his home; and a 9mm pistol, a .357 revolver, and more than 100 rounds of ammunition in Scarfo's home, according to Tuesday's indictment.

Stark is charged with purchasing two boxes of 9mm bullets from an Atlantic County gun shop in December 2007 and passing them to Scarfo.

John Maxwell, the former CEO of FirstPlus and a defendant in the pending case, is charged with buying a .357 revolver from a pawn shop in Dallas in September 2007 and driving "for approximately 48 hours from Texas to Atlantic City . . . where he delivered the revolver" to Scarfo.

At a news conference Tuesday, FBI Agent Michael B. Ward said the case was an example of the evolution of organized crime from "the back alleys to the board room."

No matter the locale, Ward said, the mob continues to use "physical threats and intimidation to gain leverage."

Thanks to George Anastasia

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Little Nicky Scarfo Jr's Son Among 12 Arrested and Charged with Racketeering

The son of a Philadelphia mob boss, Nicodemo "Little Nicky" Scarfo Jr., and 12 others, are charged with racketeering and other offenses in an indictment handed down Tuesday morning. And Federal prosecutors say members of that mob have turned to a modern crime -- pillaging the assets of a mortgage company -- in a sign that organized crime is evolving to include more white-collar crime.

Thirteen people -- including lawyers and an accountant -- were charged in a federal indictment unsealed Tuesday. Most of them were arrested in raids throughout the morning in New Jersey, Florida and Texas.

Among them were Nicodemo S. Scarfo, the son of imprisoned Lucchese crime family boss Nicodemo D. "Little Nicky'' Scarfo, five lawyers and a certified public accountant. Eight of them were due in court Tuesday afternoon.

They face charges including racketeering, wire fraud, money laundering, false statements on a loan application, securities fraud. Maximum penalties range from five years in prison to decades. "The criminal activity is evolving,'' said Michael Ward, agent-in-charge of the FBI in Newark. "It's going from the back alleys to the boardrooms.''

Authorities say the plot started in April 2007, when the younger Scarfo and his associate Salvatore Pelullo, who has previously been convicted of financial crimes, decided to take over FirstPlus Financial Group, a publicly traded mortgage company based in Irving, Texas. Authorities said it was a company with a lot of cash but not much sophistication.

The indictment charges Scarfo and Pelullo used threats to help wrest control of the company. Pelullo is accused of telling a member of the FirstPlus' board that if he didn't go along with the plan, "your kids will be sold off as prostitutes.''

The indictment says he later told others who were charged in the scheme to get the company's board to agree to hand control to his and Scarfo's new directors -- and he wanted it done immediately. He allegedly told them: "I don't care if they're in a funeral parlor, I don't care if they're in a (expletive) hospital on a respirator, we'll send somebody there. I want their vote, I want their signature, and I want it done by the close of the day today.''

Authorities say the elder Scarfo, serving in a federal prison in Atlanta, was apprised of the plot, but that he was not charged because he's expected never to be released.

After getting control of FirstPlus, Scarfo and Pelullo are accused of having it buy shell companies they owned so they could take out money. After that, authorities said, they signed a series of consulting contracts to pay themselves even more.

In less than a year, authorities said, they took $12 million and spent it on multiple homes, including one for Scarfo's ex-wife; weapons and ammunition, a plane, an Audi, a Bentley, $30,000 in jewelry and an 83-foot, $850,000 yacht they named "Priceless.'' U.S. Attorney Paul Fishman wouldn't say exactly how authorities got onto the plot, but he said it ended with a series of raids in 2008.

Since then, FirstPlus has filed for bankruptcy, blaming the alleged criminals for wrecking the firm.

Fishman said the alleged conspirators were planning one more "piece de resistance:'' They wanted to pump up the stock price of FirstPlus and sell off the company. He said that was their exit strategy. "We had a different exit strategy.''

Thanks to NBC40

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