How one drug car­tel banked its cash in New York City

Daily Freeman (Kingston, NY) - - LOCAL NEWS - By Tom Hays

NEW YORK >> In the pho­tos, Ale­jan­dra Sal­gado and her lit­tle brother Fran­cisco look like or­di­nary tourists strolling the streets of mid­town Man­hat­tan. He car­ries a shop­ping bag. She wears a white dress, a neck­lace and a leather tote slung over one shoul­der.

But the out­ings were hardly in­no­cent.

Over two hours, fed­eral agents snapped pic­tures as the pair vis­ited seven banks, stop­ping at each one to make cash de­posits of just un­der $10,000 — all from piles of drug money stashed in their bags.

Pros­e­cu­tors say the flurry of mod­est de­posits was one of the many schemes hatched by Mex­i­can crime car­tels try­ing to bring bil­lions of dol­lars in drug pro­ceeds back from the United States without at­tract­ing scru­tiny from bank­ing reg­u­la­tors.

The car­tels col­lect much of their cash pro­ceeds from the U.S. mar­ket much the way the co­caine and other drugs come in, by sneak­ing it across the bor­der.

But us­ing reg­u­lar banks re­mains in the mix, said James Hunt, head of the Drug En­force­ment Ad­min­is­tra­tion’s New York City of­fice. The trick is keep­ing de­posits small, be­cause banks are re­quired to re­port cash de­posits of $10,000 or more to the gov­ern­ment. The ben­e­fit, he said, is that if in­ves­ti­ga­tors do catch onto such a scheme, less cash gets con­fis­cated. The bag­men also of­ten face less jail time.

“It’s a lit­tle more time-in­ten­sive but it’s not as heavy a hit if you get caught,” Hunt said.

Be­fore they went to pri­son late last month, the Sal­ga­dos were paid to laun­der up to $1 mil­lion a month col­lected from drug whole­salers do­ing busi­ness with the no­to­ri­ous Si­naloa car­tel, pros­e­cu­tors said.

In­ves­ti­ga­tors say Ale­jan­dra Sal­gado, 59, who has a Mex­ico City ad­dress and was in the U.S. on an ex­pired visa, was su­per­vised by a high-rank­ing mem­ber of the car­tel.

Agents be­gan watch­ing her in New York af­ter her name came up in an in­ves­ti­ga­tion of money-laun­der­ing cells in south­ern Cal­i­for­nia, Michi­gan and Ari­zona be­ing con­ducted by in­ves­ti­ga­tors from the DEA Drug En­force­ment Task Force, Depart­ment of Home­land Se­cu­rity, the IRS and lo­cal agen­cies.

De­tails from the case files of fed­eral agents and nar­cotics pros­e­cu­tors pro­vided to the AP of­fer a look in­side how the Sal­ga­dos op­er­ated.

At one point she had been a courier who would drive drug money over the bor­der.

But later, she was as­signed by car­tel lead­ers to de­posit funds into mul­ti­ple bank ac­counts held un-


In this Au­gust 2013 surveil­lance photo pro­vided by the Drug En­force­ment Ad­min­is­tra­tion, Fran­cisco Sal­gado and his sis­ter Ale­jan­dra walk on New York’s Third Av­enue in mid­town Man­hat­tan where au­thor­i­ties say they made mul­ti­ple cash de­posits at banks within a few blocks of each other as part of a Mex­i­can car­tel money-laun­der­ing scheme.

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