TRAFFICKING IN POWER

Mexican Government and Military Higher-Ups Take Sides in Cartel War,
Investigation Shows

Like most cops in this Mexican border city, Jesus Manuel FierroMendez
was dirty. In fact, soon after being promoted to the position of
captain, he was smuggling enormous quantities of cocaine into the
United States. And when he quit his job in the spring of 2007, after
someone tried to kill him, he went to work for the Sinaloa drug
cartel, Mexico's most powerful drug-trafficking organization, run by
Joaquin (El Chapo) Guzman, the richest drug lord in North America and
the second most wanted man in the world after Osama bin Laden.

Juarez is a city of 1.3 million people that sprawls across the border
from El Paso, Tex., and is a key entry point for narcotics shipped
from Mexico to the lucrative U.S. and Canadian black markets. It's
also a wild west killing field, the most dangerous metropolis in the
world, where about seven people are murdered every day and 5,300 have
been gunned down since January 2008, the result of a vicious war
between the Sinaloa and Juarez cartels, who are fighting for control
of this prized gateway.

Fierro-Mendez's career as a drug smuggler was short but spectacular:
He was arrested in El Paso in 2008 for transporting 50 kilos of
cocaine a week across the border. This year, his audacity cost him a
27-year prison sentence.

But that's not really what's interesting about the former Mexican
police captain. This winter, Fierro-Mendez, 47, testified in an El
Paso court against Fernando Ontiveros-Arambula, his former boss in
the Sinaloa cartel in Juarez and one of Guzman's top lieutenants.

His testimony contained some unexpected bombshells. When asked about
his role, Fierro-Mendez replied: "I took control over one part of the
Mexican army through an inactive captain, a member of the army."

He said he contacted this captain through another army source, a man
nicknamed El Pantera. Fierro-Mendez's cellphone even contained
Pantera's number. The prosecutor asked why it was necessary for the
Sinaloa cartel to control the army.

"The basic objective was to try to terminate, eliminate [the Juarez
cartel]," answered Fierro-Mendez. "So that it would disappear, so
that its strength would be reduced, and Chapo's cartel could take control."

To this end, Fierro-Mendez fed sensitive information to the army
whose soldiers, in turn, would apprehend Juarez cartel members. "When
I had control of the army, of part of the army, I was known as the
leader of [the Juarez region]."

To put Fierro-Mendez's remarks in context, consider the following:
Most of the cocaine, marijuana, heroin and crystal meth entering the
United States and Canada - a trade valued at up to US$50-billion a
year - moves through Mexico's seven drug cartels. In 2007, Felipe
Calderon, the country's newly elected President, announced he was
setting the Mexican army loose against the cartels, sending 45,000
soldiers to the cities and towns to wipe out these criminal gangs.
Washington liked this strategy so much it's been spending
US$1.4-billion to help arm and train the Mexican military.

Yet an investigation conducted by The Montreal Gazette, CBC Radio and
the U.S.'s National Public Radio (NPR) has found powerful elements
within the Mexican government and army have no intention of ending
the narcotics trade. Instead, these senior government and military
officials are helping the Sinaloa cartel and its leader become the
dominant drug-trafficking organization in Mexico. This means the
cartel will likely become the most powerful organized crime group on
the continent.

"The [Mexican] government went from being a controller of
narco-trafficking to the armed wing of the cartels," says Anabel
Hernandez, one of Mexico's leading investigative reporters who has
spent five years researching a book about the Sinaloa cartel and Chapo Guzman.

"Portions or sectors of the military, the Federal Investigations
Agency, the federal police, and Secretariat of Public Security, are
at the service of the cartel of Sinaloa.. Guzman and the Sinaloans
have been protected for the past nine years by the federal government."

Figures from Mexico's attorney-general's office show that of 2,604
cartel members prosecuted since Mr. Calderon became president in
2006, less than 12% were from the Sinaloa cartel - even though it's
Mexico's largest and most powerful cartel.

Edgardo Buscaglia, a law professor, economist and UN advisor who
teaches at the Mexico City-based Instituto Tecnologico Autonomo de
Mexico, believes the Sinaloans have corrupted Mexico's political system.

"They have been able to infiltrate the higher levels of the state,
and have been able to bribe and distort their way through the higher
levels of decision-making," he says. "The money the politicians get
for political campaigns comes from organized crime, which is why they
are not touched."

Yet Mr. Buscaglia believes there's method to the government's
apparent madness in favouring the Sinaloa cartel. Given that
narcotics might well be Mexico's second-biggest export after oil and
about 78% of the legitimate economy is infiltrated by organized
crime, the country's weak government is finding it difficult to crush
the drug traffickers. Instead, he thinks it's embraced a strategy
used by governments in Colombia and Russia: encouraging the emergence
of one dominant criminal group.

"They are hoping, behind closed doors, that one organized crime group
will consolidate itself nationally," he says. "By having a national
organized crime consolidation, you will see less violence taking
place. You will see less competition among the organized crime
groups. Instead of fighting seven or eight organized crime groups,
they will be fighting one or two. That's the hope they have."

How does the Mexican army respond to the allegation it's favouring
the Sinaloa cartel?

"The army is fighting all of the criminal organizations and if you
see more arrests from [the Juarez cartel], it's because they are from
the city but we have struck all of them in important ways," says army
spokesman Enrique Torres.

The Mexican government also denies it is showing favouritism to Guzman.

"By God's sake, never in this country have we made such efforts,"
says Francisco Barrio Terrazas, Mexico's ambassador to Canada and a
former mayor of Juarez. "We are really trying to stop this problem
[of the cartels]. I have talked with President Calderon with this
issue and I can tell you he will never, never be in deals with those
criminals! Never, ever!"

When Fierro-Mendez testified in El Paso, he explained when he was
smuggling kilos of cocaine into the United States, he was also
working as an informant for the U.S. Immigration & Customs
Enforcement (ICE) service, which investigates drug smuggling.

"And was Chapo Guzman aware that you and others were giving
information to ICE?" the prosecutor asked. "Yes," he replied. "And
what information did he authorize you and the others to share with ICE?"

"Unlimited, as long as it didn't affect him."

Questioned as to why Guzman would want his people to feed information
to the U.S. authorities, Fierro-Mendez answered, "The objective was
to eliminate [the Juarez cartel] in any possible way, whether legally
or not. So it was - whether through the army or by providing
information to ICE, that was the legal way."

"So was the Sinaloa cartel trying to use ICE to eliminate its rivals
in the Juarez cartel?"

"That's right."