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Taking down a drug ring.

Byline: Karen McCowan The Register-Guard

Late last month, in a secret room inside a Eugene-area building, a federal prosecutor, a state police detective and a federal drug agent quietly finished a high-stakes game of blackout Bingo they'd begun more than two years earlier.

Posted on a wall was a large flow chart featuring driver's license or jail booking photos of nearly three dozen local members of a Mexico-based drug trafficking ring. All but one of the faces was obscured with a large, red "X" signifying that U.S. District Judge Michael Hogan had sentenced them to prison.

Now the trio could cross off the final photo, that of confessed heroin dealer Jose Manuel Cabadas.

The July 17 sentencing of Cabadas to 10 years in federal prison marked the end of Operation Rainbow Drop, one of the largest drug stings ever conducted in Lane County. The operation was named for the diversity of smuggled drugs - heroin, methamphetamine and cocaine - the 35 defendants peddled here.

To bring down the multitier network of drug suppliers, investigators monitored the very devices that had made the criminal organization a model of business efficiency: dealers' cell phones.

By the time the operation ended last month, 35 people were sentenced to a collective 220 years in prison for selling an admitted 95 pounds of heroin and seven pounds of pure methamphetamine, as well as a small amount of cocaine.

Not a single case went to trial. All 35 defendants pleaded guilty. And none challenged the 159-page affidavit by Oregon State Police Detective Erik Fisher that persuaded U.S. District Judge Ann Aiken to authorize a series of nine wiretaps in late 2006 and early 2007.

Investigators then analyzed conversations and calling patterns, along with information gathered by federal drug agents and local police agencies to arrest the 35 in March and April of 2007. In the process, they seized more than $600,000 worth of heroin and $104,000 worth of methamphetamine, according to a case summary filed this month by Eugene-based Assistant U.S. Attorney Frank Papagni.

Disrupting the supply chain

The amount of seized drugs was significant - the 16 pounds of heroin Fisher found at the Springfield home of one top-tier defendant was the second-largest heroin seizure in Oregon history.

But that was not the most important outcome, said Fisher, who led the investigation.

The recovered drugs were just a one-time snapshot of the life-wrecking wares the group sold here week after week. More important, Fisher said, was the disruption of the local heroin supply - although other dealers have now begun to step into the void created by the arrests.

"It's frustrating to see it coming back," said Fisher, now the Salem-based supervisor of OSP's drug unit. "But 35 people getting a total of 220 years in prison is pretty satisfying. Those people are not going to be selling drugs in Lane County until they get out."

"To arrest so many folks and get so many of them convicted really damages an organization," he added. The distributors, Fisher said, "were responsible for the bulk of the heroin coming into Lane County."

Operation Rainbow Drop took out every local player in the well-organized ring, authorities said. At the bottom of the government's flow chart of those arrested were 22 street dealers - most of them Caucasian, longtime local residents. Above them were higher tiers of suppliers Papagni likened to regional distributors, who in turn answered to bosses - including a Mexican woman - who were not based in Oregon. Cell phone conversations revealed that the top local operatives referred to the woman as La Maestra - Spanish for a female teacher. The woman, whose real name is not disclosed in records, was not arrested in the sweep.

At the top of the local organizational chart were three Mexican men who were in Oregon illegally: primary heroin suppliers Armando Paz-Mendez and Alvaro Ramirez-Baldenebro and meth supplier Salvador Vargas-Molina. The trio supplied drugs to two family-run organizations that sold drugs to dealers in two distinct sales territories. Edgar Valera-Mendoza and his wife, Paulina Garcia-Gutierrez, a Mexican couple also here illegally, provided heroin to dealers selling to Springfield and University of Oregon neighborhood addicts. Arturo Arciga, his father and two brothers - all legal U.S. residents - worked with two illegal immigrants to supply drugs to street dealers under the Arcigas' Highway 99 front business, Los Michoacanos Motors. Their sales territory reportedly extended north from West Eugene to Harrisburg and Corvallis.

After all of them were arrested, it became almost impossible for local residents to buy heroin without driving to Portland, said a local DEA agent who worked on the operation.

"Heroin prices increased significantly," said the agent.

Only recently has local availability begun to increase, with other dealers now beginning to replace those swept up in the March 2007 arrests, authorities said.

Eugene Police Sgt. Kevin McCormick, who leads that agency's drug team, said he still sees the impact of the federal operation.

Local users can still get heroin, he said, but they have to work harder to do so.

The well-oiled efficiency of the Mexico-based operation has not been replicated, he said.

McCormick called it "gratifying" that the federal operation had enough staff to put away the suppliers he'd tried for years to shut down.

The wiretap investigation "scared the heck out of them clear down into Mexico," he said.

"A sophisticated operation"

Earlier this month, Papagni and the DEA agent finished dismantling "the holy of holies" - the room where agents listened in on suspects' phone conversations. When a reporter visited the windowless room after Cabadas' sentencing, it was empty and unremarkable, but for the flow chart with its X'd-out faces.

However, for three months beginning in December 2006, the place buzzed with activity right out of the HBO series "The Wire." Here, a computer - unnetworked for security reasons - captured calls to and from seven cell phones covered by the wiretap warrants. Here, drug agents monitored suspects' phone conversations and movements. Here, Spanish-fluent translators flown in by the DEA helped local agents make sense of what they were hearing.

The suspects were quite creative with euphemisms for their illegal products, Papagni, Fisher and the DEA agent said. Heroin and meth were referred to as onions and cheese, tamales and pies - even shirts and pants.

But the dealers were sometimes clumsy in putting the code words to use in sentences.

"Did the pants fit?" upper-level distributor Vargas-Escobar asked Valera-Mendoza in one intercepted conversation included in court documents.

"They were a little loose," Valera-Mendoza answered.

Vargas-Escobar replies that he will "talk with the tailor," but adds that Valera-Mendoza might get a better fit if he bought "40 pants per month."

The wiretap revealed that the drug traffickers conducted business in some surprisingly public places.

While other Lane County residents shopped for paint at Jerry's Home Improvement Center or clothing at Gateway Mall in Springfield or a quick lunch at a Burrito Boy restaurant, the trafficking organization used parking lots of the same establishments to buy and sell heroin, meth and coke.

As investigators listened in on the dealers' calls, they drew a series of circles and flow charts, moving around suspects' photos as they better understood their roles. By the time the wiretap concluded in March 2007, the transcribed conversations filled 30 fat binders.

When the cases got to court, many suspects claimed no knowledge of a larger organization, but Papagni was unconvinced.

"Within eight hours of when we begin making arrests, all the lines go dead and the phones are thrown away," he said in a recent interview. "These people pretend to be ignorant, but this was a sophisticated operation that included money laundering."

The chart-topping trio of suppliers - Paz-Mendez, Ramirez-Baldenebro and Vargas-Molina - declined to use appointed public defenders, each hiring a private attorney. Vargas-Molina's lawyer flew in from Los Angeles by private jet, investigators said.

Plea deals were rejected

Ironically, the sophistication of the drug organization helped investigators get the wiretap warrants that led to so many convictions.

The local cases began back in 2000, when local DEA agents received a tip about one of the street dealers, an illegal immigrant, selling Mexican-made meth in Eugene. By the spring of 2005, DEA investigations outside Oregon confirmed that a Mexico-based drug trafficking organization was operating in the Southern Willamette Valley. Local agents set out to investigate their way up the chain, Papagni said, but the drug ring's local leaders were savvy about thwarting conventional surveillance.

Paz-Mendez, for instance, used an isolated house along Highway 99 to receive, store and distribute heroin, the prosecutor said.

"There was nowhere to hide and watch them," the DEA agent recalled. "Anyone close enough to watch that place would stand out like a sore thumb."

And the traffickers were brazen about confronting and staring down officers trying to watch the place, he said.

That became useful ammunition in seeking court permission to use more invasive tactics, Papagni said.

"Getting a wire tap authorization is no easy thing," he said. "Invading people's privacy is not done haphazardly. And the most intrusive thing the government can do is listen to someone's telephone conversations. You have to show that no other way of investigation will work. By doing such a great job of counter-surveillance, they made it easier for us to show that."

So, starting in September 2006, Fisher and DEA agents worked with Papagni to build a case for a wiretap. They did so using less invasive techniques, from analyzing phone bill charges to going through garbage. It was December before Fisher presented to Aiken his successful affidavit in support of wiretaps.

It was frustrating to wait so long to seek the court warrant, he and the DEA agent said. But they recognized the wisdom of involving a prosecutor on the front end of that process. Knowing any legal challenges of the government's case would end up before the Ninth Circuit Court of Appeals, they didn't want any errors to reverse convictions.

Court documents in the case dramatize the communitywide impact of illicit drug sales. Many sentenced addict-dealers were prolific thieves who supported their habits by stealing items ranging from identification to bicycles to big-screen TVs. The investigation also illuminated the human misery inflicted by the drug trade. One suspected street-level dealer died of an overdose before agents could arrest her.

Victims also include the families of the convicted dealers, Papagni said.

"People ask me if it's hard to send people to prison," he said. "The hard part is when you look in the back of the courtroom and see their families - disabled parents with nobody to take care of them, kids crying, wanting to know why daddy's going away. This is not a victimless crime."

Drugs bought and sold here also contribute to suffering south of the border, where the drugs are produced, the DEA agent said.

"Americans who buy this stuff are in essence helping facilitate the violence in Mexico," he said.

The threat of that violence extended to court proceedings, he added.

All defendants facing deportation rejected plea deals, the agent said. They chose extra prison time over the threat of being killed as suspected snitches.

"The cost of staying alive - or keeping family members in Mexico alive - is to do more time," the agent said.

The chart of the local case didn't extend above Paz-Mendez, Ramirez-Baldenebro and Vargas-Molina to their bosses.

"What you don't see on the chart is the CEOs," the prosecutor acknowledged.

The DEA agent agreed.

"But it's fair to say that our wire interceptions gave us information on people off the charts that we pass along to investigators in other places," he said.


Authorities earlier this year dismantled a network that brought heroin, meth and cocaine into the Lane County area. Top local operatives are shown below, with sentences. The three Mexican men who led the local operation - Armando Paz-Mendez, Alvaro Ramirez-Baldenebro and Salvador Vargas-Molina - were in the United States illegally. In addition to those listed below, 22 street dealers were arrested and sentenced.

The married couple provided heroin to dealers selling to Springfield and University of Oregon-area addicts.

Arturo Arciga, his father and two brothers worked with two illegal immigrants to supply drugs to street dealers. Their sales territory extended north from west Eugene to Harrisburg and Corvallis, authorities said.
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Title Annotation:Courts
Publication:The Register-Guard (Eugene, OR)
Date:Aug 23, 2009
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