Doug Wankel is former head of DEA operations

Absolutely. Well any time you have that amount of money seized in an account that moved from Mexico through various transactions into Switzerland from a Mexican citizen using a phony name, immediately your antennae go up as to what generates that kind of money. And of course when you think of Mexico, drugs is one of the things that immediately comes to mind. It turns out it's Raul Salinas, the brother of the former president. So you begin to look at determining whether or not you can ascertain or find that connection.

IT WAS A SUSPICION THAT THIS WAS DRUG MONEY?

Well I think there was a suspicion in DEA's mind right away. Any time you have that amount of money moving to Switzerland in what looked to be a circuitous, or if not circuitous, at least in a manner not consistent with normal banking practices, it's noticeable. And then we immediately get suspicious that this is drug money because what clearly comes to our mind that generates money like that from a country such as Mexico is drugs. So that immediately comes to our attention. Right away we thought of drugs but it's a far cry from thinking or having suspicions and actually having evidence that you can lay on the table.

YOU WERE HEAD OF DEA OPERATIONS WHEN THE REQUEST CAME IN TO YOUR OFFICE IN SWITZERLAND. TELL US WHAT HAPPENED?

Well essentially it never came to my attention because it was not at the level to come to my attention at that time. But just to sort of capture what went on, essentially the banking industry in Switzerland contacted the local authorities in Switzerland and said that we have what appears to be a suspicious account, a customer, and there is something suspicious about this individual. The police investigated, got a copy of a passport in particular a name, Gutierrez I believe it was. It was from the country of Mexico, a Mexican passport. So they went to DEA there because they knew DEA had connections in Mexico. DEA had an office in Mexico and they thought that perhaps DEA could assist them in getting connected to the Mexican authorities to investigate this passport. That happened. DEA Switzerland sent a copy of the passport with whatever information they had to the DEA office in Mexico City. Mexico City DEA discussed it with the authorities in Mexico, I believe the PRG.

THE PRG IS THE ATTORNEY GENERAL?

Yes, the attorney general's office there in Mexico, and passed that information to them. Mexican authorities came back and said, hey we know this person. This is Raul Salinas. This is an alias that we know from time to time he has used, and that information was passed back to the authorities in Switzerland and then the DEA in some sense helped to arrange a face to face meeting between the Swiss authorities and the Mexican authorities to begin the two countries' investigation of this incident.

THE DEA NOTIFIED THE SWISS THAT THERE WAS INFORMATION LEADING YOU TO BELIEVE THAT RAUL SALINAS HAD A CONNECTION TO DRUGS?

Well at some point, I'm not sure exactly when this would have transpired, but at some point obviously Raul Salinas's at least personal relation with people such as Juan Garcia Abrego and others was made known to the Swiss authorities. I'm not sure what time frame that happened in.

BUT ONCE YOU KNEW IT WAS RAUL SALINAS, I ASSUME THAT SOMEBODY PUT THE NAME INTO YOUR COMPUTERIZED FILES, AND CAME UP WITH SOME INFORMATION?

Yeah I'm sure they did just exactly that. But Raul Salinas has not been convicted of any drug crime in Mexico that I'm aware of, and our system doesn't show that. There was obviously some relationship shown at least on a personal level between he and some major drug figures such as Juan Garcia Abrego so that would have come to our attention. But there was no evidence per se of his involvement with that.

DESCRIBE MEXICO'S DRUG EMERGENCE......

It started out moving most of that volume of cocaine through the Caribbean into the United States, through Miami, Florida and other areas. But through a lot of effort by the Americans and others, that was curtailed a great deal. And then in the late '80s, around '90 you begin seeing an awful lot of the cocaine coming into the United States via Mexico into Central America moving from Colombia. Colombia was where the cocaine ended up being finally processed into hydrochloride - cocaine hydrochloride, then moved from there into Central America, through Mexico into the United States.

SO IT'S IN THE LATE '80s, BECAUSE OF ENFORCEMENT PRESSURE IN THE SOUTHEAST, THAT THIS MOVEMENT HAPPENS INTO MEXICO?

Yes, yes.

AROUND THE TIME THAT CARLOS SALINAS ACTUALLY BECAME PRESIDENT OF MEXICO?

Yes whenever that was. I'm not sure now.

'88.

Okay that would have been - or shortly thereafter in the '90s, and I'm not drawing any relationship to that. But certainly in the '90s, since in the '90s you've had a lot of the movement, the majority of the movement of the cocaine coming from Colombia into the United States moved through Mexico. Originally that started out with Colombia.

So probably the last figures I saw, somewhere between 60 and 70% of all the cocaine coming into the United States comes through Mexico and it's handled by Mexican organizations in Mexico and then turned over to Colombian organizations or Mexican organizations in the United States.

So it's a serious problem. Couple that with the fact that now you see so much more of the money derived from drugs being centered in and collected in and around Los Angles, California, because much of the control mechanism for the Mexican organizations especially, centers in Los Angeles. So the money moves to Los Angeles. Then Los Angeles trafficking groups connected to the Mexican groups have to get the money moved back into Mexico which they do through - a lot of it that I'm familiar with actually goes by bulk shipment of millions of dollars at a time in cash back across the border into Mexico in cars.

SO IF WE STAND AT THE BORDER AND SEE ALL THE TRAFFIC GOING INTO MEXICO -- ONE OF THOSE VEHICLES GOING SOUTH -

Has millions of dollars of green U.S. dollars going to Mexico. And once it gets to Mexico it then has to be laundered, converted, whatever. Much of it stays in Mexico. Some of it goes on back to Colombia for payment, whatever.

AND HOW HAS THIS CHANGED THE ATMOSPHERE IN MEXICO? HAS IT MADE MEXICO A GREATER THREAT?

Well Mexico, yeah it's a greater threat because of the volume of drugs now coming through Mexico. It's a greater threat because of the violence associated with the Mexican trafficking in Mexico along our borders. It's very difficult for the Americans now to get the type of work and support they need from the PRG, the attorney-general's office in Mexico, the authorities, the government of Mexico, because the traffickers are much more powerful now than they were. They have much more money now to use for their operations. They have more money to use for corruption which has long been a problem in Mexico as well.

HAS THE CORRUPTION TAKEN ON A SUBSTANTIALLY LARGER PART OF SOCIETY? TEN YEARS AGO THINGS WERE BAD IN MEXICO.

Corruption was a very serious problem in Mexico 10 years ago. It remains, 10 years later, a serious problem today. I think the difference that I see is that more money is available for corruption. Also when we look at the Mexican traffickers, based on the Mexican traffickers' relationship with the Colombian traffickers, the major guys there, Miguel Rodriguez Awayla who is the big guy operationally as far as the Cali cartel had a direct relationship with Amado Carillo Fuentes and others.

There has been no more organized a criminal syndicate probably that the world has ever seen but certainly not in drug crime activity than what the Cali cartel put together as far as how structured, how sophisticated, how much technology they used, how compartmentalized they were. I mean the way they conducted business was better than anything we've seen in the criminal syndicates in the past. Colombian traffickers as they worked with and through the Mexican criminals also imparted a lot of that knowledge to them.

So the Mexican criminals have gotten smarter, they're wiser about how they use telephones, about how they compartmentalize their business and so they're a much more formidable threat than they were before. Couple that with the fact that they now have more money available to pay off or to spread around and they probably learned from the Colombians. Colombians actually set aside great portions of their profit to be used to corrupt or to pay off the various people within government, within law enforcement, wherever that was needed. The Mexican criminals I think have learned from that also.

SO IF YOU WERE LOOKING AT THE FUTURES MARKET IN COCAINE YOU'D BET THAT THE MEXICANS ARE GOING TO BECOME -

Well it's something I'd be very concerned about. I don't know - look, it's still principally the way I described it earlier with Bolivia - yeah Bolivia, Peruvian production of coca leaves, conversion to base, base to Colombia, Colombia through Central America into Mexico, from Mexico to the United States. But the thing that concerns me is number one, at least those two incidents we're aware of where the Mexicans went and did it and secondly, when one looks at the international criminal capability south of the border of the United States - I mean in the United States we've got our own international criminals, Canada has got a few, all this stuff. But when you look south of the United States, the real potential for international criminal activity as it relates to drugs is really limited, or is only seen in two countries and that's Colombia and Mexico.

Mexico has probably even more potential for criminal activity. Mexico has a potential to supply drugs to Europe if they decide to do so or try to do so, much like Colombia did. And Mexico and Colombia are the only two countries I see with international traffickers at that level that have the background, that have the money, that have the sophistication, if you will, to do that.

THE NUMBER ONE INTERNATIONAL CRIME PROBLEM IS ALSO A MAJOR NATIONAL SECURITY PROBLEM....?

Without a doubt.

FOR THIS COUNTRY?

Yeah it is, it is. There's no doubt about it right now. I think that if you talk to a number of leaders in Washington, you'll hear them say it's either number one or thereabouts, close to it.......drugs as a crime in the United States probably is, from a crime standpoint , the national security threat to the United States right now.

YOU SAY WE HAVE TO BE ABLE TO HAVE A RELATIONSHIP WITH THE MEXICANS TO INCARCERATE MAJOR TRAFFICKERS BUT WHAT WE'VE SEEN OR WHAT WE SEEM TO UNDERSTAND IS THAT THE GOVERNMENT OF MEXICO IS MORE IN THE HANDS OF THE TRAFFICKERS THAN EVER BEFORE.

Well I don't know, I've always been concerned about that potential. I'm not going to jump quite that far and say that yet, but it's certainly a possibility that there's always been corruption in Mexico. There's corruption in the police, there's corruption in the government. Otherwise how far that goes I can't comment on. I don't have specifics to get into on that.

But I know it's very large, it's very significant. It impacts the ability, the capability of the Mexican government to act. I'm more concerned with the fact that for the last two years the United States has made more overtures and has been more forthcoming to the government of Mexico in trying to work with them to try to establish a real meaningful relationship on this issue than ever before. In the last two years I've seen the United States government talk with Mexico whereas in the past sometimes they talked to Mexico which didn't pay very much dividends and caused a lot of animosity, a lot of sovereignty issues, a lot of sensitivities that end up being negative as far as the progress you try to make in this business.

But when you look at the last two years at things that have gone on, when you look at the personal attention that attorney-general Reno has spent on bettering relations between United States and Mexico, the fact that she sends down her personal emissary, the person who is most responsible for administering the Department of Justice under the attorney-general's programs on drugs, to go down and meet regularly with Mexican officials to try to build this relationship, to try to improve the law, to try to get the training, to try to get the operational relationships necessary to move forward on this. And then you see that at this juncture, at this point in the game it doesn't seem to be paying the dividends that we expect.

WHAT DO YOU MEAN ? ?

We're not seeing the laws. Certainly they've got a money laundering law and they've made some progress on laws going into play there but the money laundering law didn't go far enough as far as the currency transaction reporting requirement not being the way it should be, and certain other things. The training hasn't come along as quickly as it should have. The operational ability of the law enforcement entities of United States - DEA, FBI, Customs - linking up with the PRG and whoever else in Mexico is not moving as quickly as it should be from a law enforcement standpoint.

THE FORMER MEXICAN AMBASSADOR TO THE UNITED STATES TOLD US THAT DURING THE SALINAS ERA, WHICH WOULD BE UP TO 94, THE PRESIDENT OF MEXICO REALLY DIDN'T TAKE DRUGS SERIOUSLY.

That's probably - I wouldn't doubt that, it's probably correct, you know. And that's the fault of the United States government as much as anybody. Because if you go back to that era and beyond, drugs wasn't that high a priority in foreign policy considerations between the United States and Mexico, let's face it. It really wasn't. So I think the United States government historically and traditionally probably has problems in being tough with Mexico. Now, you know, I'm not naive enough to sit here and to say that one has to go in and beat up the government of Mexico because of the drug issue. I realize it's a lot more complex than that and you have to work with them to do that. But in the last two years, I have seen the U.S. government through my direct knowledge and dealings there go forward and offer to work and attempt to work and to do anything and everything to forge a real partnership with Mexico on this issue, unlike anything that had been attempted or done before. And I've seen very little come from that, and there should have been a lot of progress from that.

And I will say this, that unless that happens, unless the Americans are there to help the government of Mexico, to work with the government of Mexico which also helps the United States on this issue, you're going to have very little success and very little chance of success because the government of Mexico does not have the expertise. They are just getting the laws. They don't even have them sufficient yet. They don't have the training, they don't have the resources, they don't have a professional police at this juncture. They just don't have the capability of pulling this off by themselves.

So all these people that argue sovereignty, we'll handle it, forget it, all right? Certain people within the government of Mexico are still in denial. They don't want to admit that the problem exists to the magnitude, to the extent that it does, coming through Mexico, coming from Mexico into the United States. They don't want to admit that they have Mexican international criminal organizations, all right? They get very sensitive about calling them Mexican criminals. They want to call them international criminals that operate from Mexico. Give me a break. They're Mexican criminal organizations.

HOW SIGNIFICANT IS THE FIRING OF LOZANO, THE ATTORNEY-GENERAL?

Well it's significant certainly from the standpoint of a new person comes in and that person also then gets rid of the head of the PRG. You get a new person that's also then in charge of PRG so you have to start over from that standpoint. I don't know the new person. I don't know the budding relationship. But I do know that you start almost at square one again with some of the initiatives, with some of the issues that you've been dealing with. So it's just troubling.

BUT IT SEEMED THAT LOZANO WAS PERCEIVED AS BEING LET'S SAY A STEP IN A DIFFERENT DIRECTION, AN OUTSIDER WHO WAS BROUGHT IN.

Well an outsider from the standpoint that he wasn't from the PRI. I guess in 60 some years you hadn't seen somebody like that be named to a cabinet level position. In fact he's in the attorney-general's office, able to have a lot of latitude to do these things. Certainly the people that dealt with Lozano and with President Zedillo as well have always been struck by their integrity, their intent, their commitment, their public statements. The problem is now that we've been involved in this process for some time there has not been that much in the way of follow-through that has resulted in actions, that has resulted in positive developments as far as major investigations, and major people arrested.

WHAT DO YOU MEAN BY THAT, THEY'RE NOT BEING -

Well they had a problem, for example, right now, we have bilateral tax forces and other things existing in Mexico that have been set up in the last few years or have been conceived of and are in the process of being implemented. And with DEA, the FBI, and Customs, working there hand in hand with the government of Mexico law enforcement to do major investigations, to travel around . . . to work for the government of Mexico. I mean the government of Mexico, certainly it's their country. It has to be, they have to be the lead and we have to fall within the constraints and under the policies and procedures of Mexico.

But in this day and age with the violence that is now going on in Mexico which is probably a little bit worse than normal or worse than the past when you look at some of the targets, some of the commandants, some of the prosecutors and others that have been killed and assassinated including in Mexico City which had been somewhat unheard of in the last year or so, it has heightened the level of awareness and probably security concern to Americans that are operating as investigators in Mexico. And for them to be precluded, for example, from carrying a firearm for their own protection or self-defense by the government of Mexico, which is the situation right now, that's just not conducive to having the relationship and the investigative activity you need.

Well what's changed, look, Mexican criminals and traffickers have always been violent. They're very much like the Colombians in that regard. They don't hesitate to deal with silver or lead. Take the pay-off, take the corruption or we'll kill you. You get too close to us in your investigative processes, whether you're a prosecutor or you're police, if we can't buy you, then we will resort to violence and often that means killing you.

YOU DON'T TAKE THE SILVER? YOU MEAN IF YOU DON'T TAKE THE MONEY?

If you don't take the silver you get the lead. This has long been something that was very prominent in Colombia and we see it in Mexico as well too. So it's a serious problem now when you look at the numbers of incidents of senior people, mid-level people involved in the prosecutor's office in the government of Mexico, the law enforcement officials at senior levels in Mexico that have been assassinated and killed, and the threats to others, it's a very serious thing. And this has heightened, it does happen more and more today at those levels than it did in the past.

IS MEXICO BECOMING THE NEW COLOMBIA?

Well this goes back to the situation in Columbia, you're right. There was a cardinal assassinated, there was a presidential candidate that was assassinated. As far as I know, neither of those crimes have been adequately investigated and solved. So yeah, that's a serious problem and you have that sort of thing that takes place in Mexico and it's not satisfactorily brought to a conclusion as far as what happened, or people aren't brought to justice for it. And then you couple that with the whole drug angle, the violence associated with that, the seeming wanton retribution or retaliation or going after by the Arellano-Felix brothers or whoever else in Mexico against people that they perceive as their threat, whether it's a competing trafficker or whether it's a police officer or whether it's a prosecutor. Well when that type of thing happens with almost like wanton abandon and nothing comes to light, nothing comes to the end nobody is brought to justice, then it certainly causes a lot of concern.

WHAT ABOUT MEXICAN BANKS AND THE SUBJECT OF DRUG MONEY?

I'm certainly not here today trying to imply, state, or insinuate in any sort of way that major banking institutions in Mexico are willingly involved in the laundering of drug proceeds. There is no doubt in my mind, with the billions of dollars going into Mexico that have to be laundered either to stay in Mexico or to move somewhere else, that they do pass through some banking institutions. They certainly pass through the Casa di Cambio.

I think that when you look at the situation, the billions of dollars moving from the United States into Mexico, some of which remains in Mexico, some of which moves on. Once it gets to Mexico, it has to be laundered in some fashion, whether it's through Casa de Cambio, whether it's through a bank, like it could happen in United States, whether it's through the purchase of land or the purchase of companies or business, whatever. That type of thing is taking place in Mexico. I mean it is, it just stands to reason it has to happen. You don't just have rooms full of money acquiring dust in Mexico. They put that to use, they clean it in some way so that they can bring it back in some other form.

WILL MEXICO GET CERTIFIED?

I think Mexico will either be certified or certified with national interest waiver. And if I was a betting man, probably certified, just because of the political process.

WHAT DO YOU MEAN?

Well like I said, drugs and crime aren't the only issues. And aren't necessarily the major issues between Mexico and United States. And I'm not saying they should be. But as you look at the drug issue, as you look at the drug problem with Mexico, I think that you look at what's transpired in the last 12 months and what's likely or unlikely to transpire in the next two months or month and half before certification has to be considered one way or the other. I think it's going to be very difficult for one to point to successes, for one to point to movement in the direction necessary to attain success.

And frankly I think that if you look at some of the down side of what's gone on with the killings of the police, the killings of the prosecutors, the lack of movement on that, the lack, the fact that no major trafficker has been apprehended or prosecuted in Mexico. I think it's very difficult to look at that, to look at what exists or to look at what doesn't exist and to come to the conclusion that Mexico, with all the resources that the United States has tried to pour that way, with all of the efforts that the United States has made in a bilateral relationship with Mexico, then it's very difficult to say that Mexico has been forthcoming and has done what it could and what it should in this arena.

So I'm saying they don't meet the test from an operational standpoint on drugs. But what I'm saying is that because of other issues and concerns, trade, economic, other bilateral relations, that they will probably, they will get certified either full certification or certification national interest waiver.

.......THE CRIME PROBLEM TAKES A BACK SEAT......

Well historically that's been the case between United States and Mexico. It hasn't had the same priority. It hasn't been at the level of priority in my estimation that it should be in our foreign policy determinations and considerations with Mexico. NO BUT WE'RE TALKING IN AN OVERALL SENSE.

In the overall sense, at the macro level and at the level of government , it's not what it should be, no. It's not the same, it's not the priority it should be in the government of Mexico, but that's a bit because the United States hasn't really caused it to be in a sense, that you know, at the national level we haven't really focused on that I think in a meaningful way. Certainly the attorney general has, but I don't think that beyond the attorney general we've seen that. Certainly Barry McCaffery as a drug czar is trying to do that, but I think that trade, economic issues, those sorts of things, certainly are prevailing.

I KNOW THAT YOU DON'T KNOW ANY DETAIL ON IT, BUT IN THE COURSE OF THAT INVESTIGATION AND IN HEARING ABOUT MEXICO, THE NAME OF THE HANK FAMILY HAS TURNED UP. WHAT, IN WHAT CONTEXT?

Well the Hank family has turned up as some sort of relationship, as I understand it. The Hank family turns up quite often in Mexico anyway because of the fact that it's a family of one or more billionaires. But anyway, it's a family that has amassed billions of dollars in a relatively short period of time, I guess, less than a generation or so, in Mexico and so one always scratches one's head and says how did this happen, among other things, where'd this come from?

But the Raul Salinas relationship with the Hank family, which has come to light, certainly causes one some concern and then you see Raul Salinas's relationship with Juan Garcia Abrego, a very large drug trafficker in Mexico that was later brought to justice. Actually the Mexican government did arrest him a year or so ago and deliver him to the United States because he is an American citizen and he was then prosecuted for crimes in the United States and is now, I don't know if he's been sentenced, but he's probably going to get life imprisonment.

YOU WERE TALKING ABOUT THE MEXICANS NOT HAVING THE POLICE FORCE, THE ABILITY TO INVESTIGATE, THE TECHNICAL SKILL, OR THE INVESTMENT IN MONEY FOR A PROPER POLICE FORCE, FOR A CIVIL SERVICE POLICE FORCE. ONE ANSWER IS LET'S USE THE ARMY.

Well the military is not an answer to this. I have only recently, in the last year, felt that perhaps in the case of Mexico there could be some utilization or some opportunity to use military force in Mexico for short term under limited situations. And by that I mean given the violence, given the power that these people have amassed and control certain cities if not states in Mexico, there could be a time if you need to go arrest a major trafficker who is in a particular location, city or ranch or whatever when there might be a military operation necessary to apprehend or to detain that person. But beyond that the military, first of all the military is even less trained. They have no idea of the rule of law, of evidence, of procedures. I mean they're trained like the military of United States. Go out, destroy, kill, do that. That's not what we're looking for here and that's not going to work in a democratic form of government and certainly it's not what we subscribe to in this country nor do we want to see happen in a country such as Mexico. And to say that one reason they want to use them is because they are highly trained in military operations and they are not believed to be as corrupt as the police, well I can tell you this, that in the past when they have gotten involved in these sorts of ventures in Mexico they have become as corrupt as the police and they will become as corrupt as the police again. Also the military in Mexico has very little control exerted over it. You don't have the same ability of even the president, or whoever else to maintain the necessary controls over the military. But most importantly it's the whole rule of law process. The whole ability to investigate, the ability to gather evidence, the ability to prosecute once you arrest, and to obtain convictions. That's what we have to build up to do. So I think that the military is a quick fix or a solution only in that isolated instance that I just described.

DESCRIBE WHAT HAS HAPPENED IN LOS ANGELES.....

Moving car loads of money in boxes, in suitcases from Los Angeles south into Mexico whether it's across the border at Tijuana or whether it's over through Arizona and down into Mexico that is a serious, serious problem. And that is why you're seeing Los Angeles now getting to be more and more of a money laundering center in the United States, or the movement of money cashed in United States. It's because of the Mexican involvement, because of criminal activity in Mexico. The fact is that much of the control that exists in the United States as far as Mexican organizations throughout United States emanates from Los Angeles. So money comes back there and then they have to get it into Mexico. One of the favorite means of getting it into Mexico is in bulk cash shipments concealed in four wheel drive vehicles, cars, whatever, moving back across the border to Mexico.

HOW DO YOU LAUNDER MONEY IN MEXICO? WHAT KIND OF INSTITUTIONS WOULD YOU USE?

Well look, let me just talk about it as a rational, prudent person. I think from my knowledge, being involved with the DEA for as long as I was, the money going into Mexico either goes through casa de cambio and moves on then into some other arena and then is shipped elsewhere in Mexico or to another country. You buy a business where you can take cash in and trade it whether it's to get into a trucking company or to smaller regional airlines within Mexico. I mean any place where you can take in a large amount of cash and convert it into an asset without getting asked a lot of questions which, I think, you can do now in Mexico. Or any place that you can go through gambling or whatever else to move money or ostensibly shift or change the color of money. Anything like that fits the needs of the individual moving the money.

WE INTERVIEWED ONE OF THE MORE PROMINENT AND WEALTHIEST PEOPLE IN MEXICO . HE SAID NOTHING HAS REALLY CHANGED. EVERYTHING IS FINE IN MEXICO AND THIS HAS ALL BEEN GOING ON FOREVER.

Let me leave you with this. When you look at what's transpired in Mexico in the '90s vis a vis the cocaine business with the Colombians moving through Mexico and then the Mexican traffickers wresting control of that which moves through Mexico, the cocaine, and generating more criminal activity because they set up more organizational elements in Mexico, and within the United States as well, which they are doing more so now than they did in the past. They're generating hundreds of millions of dollars if not billions of dollars more in criminal proceeds than they did in the past, and the money is going right back to these international criminals that are Mexicans, operating in and from Mexico. Now if that doesn't change the problem in Mexico, if that doesn't add to the crime, if that doesn't add to the violent situation that the media is painting or portraying then I'm out of touch. This is just not possible.