A major South American drug ring allegedly responsible for smuggling tons of cocaine into the United States from Peru and Colombia has been cracked with the arrest of 59 people, federal authorities said Monday.
U.S. Atty. Peter K. Nunez said Augustin Fernando Maurtua, 26, of Carlsbad, headed West Coast operations of the ring while Jose Antonio Ledgard, 27, of Miami, was the East Coast chieftain. Both men, identified by Nunez as Peruvian nationals, are being held without bail and were among those arrested last week and over the weekend.
"These people (Maurtua and Ledgard) were in the highest echelon in the South American cocaine cartel," Nunez said at a morning press conference Monday in San Diego.
Eighty suspects were named in a 291-page, 204-count indictment unsealed Monday and 59 were in custody. Arrests were made throughout Southern California and in San Francisco, Nevada, Guam, Florida, Texas, Georgia and Michigan. The arrests involved more than 100 federal agents and culminated an 18-month investigation.
Nunez said that 20 other people, most of them cocaine purchasers, are expected to be named in a new indictment by Thursday.
Several expensive automobiles, jewelry, $100,000 in cash and one kilogram of cocaine were seized during the arrests, Nunez said. He said the ring was responsible for taking "millions of dollars" in drug profits out of the United States.
Nunez said "extensive wiretap surveillance" provided key evidence in the case, but added that investigators still are not sure how or where the ring was able to smuggle the drugs into the United States.
"We know they were coming into the United States in several different ways, but we don't know how the bulk of it was brought into the country," said Gary Penrith, FBI special agent in charge of the San Diego office. "I wish we did."
Nunez said at the press conference that the ring was responsible for 20% to 25% of the cocaine brought illegally into the United States. However, later in the day, Gary Laturno, a spokesman for the FBI's San Diego office, said that Nunez was wrong. The ring was responsible for 25% of the cocaine smuggled into the U.S. from Peru, Laturno said, but he added that that was based on a 15-year-old estimate.
Diogenes Galanos, special agent in charge of the local Drug Enforcement Administration office, could only say that "metric tons" were involved in the smuggling operation. The FBI was responsible for the investigation, and Galanos said that the DEA's role was limited to investigating leads in Peru and Colombia.
A DEA spokesman in Washington said that in 1983 an estimated 50 to 61 metric tons of cocaine were smuggled into the United States. A metric ton weighs 2,200 pounds, and a kilogram equals 2.2 pounds. Cocaine sells wholesale for about $40,000 to $50,000 a kilogram, the spokesman said. Smaller amounts are substantially higher.
Four of the major figures named in the indictment, which was not available to reporters Monday, were indicted under the federal Continuing Criminal Enterprise statute, which was designed to prosecute managers of narcotics traffic. Other charges include conspiracy to possess cocaine, distribution of cocaine to minors and racketeering charges.
According to the indictment, the organization had cocaine distribution outlets throughout the United States, including San Diego; Los Angeles; San Francisco; Dallas; Miami; Sun Valley, Ida.; Portland, Ore.; New York; Atlanta; Hawaii, and Guam.
Del Mar businessman Michael Jay Sullivan was named in the indictment as "one of Maurtua's and Ledgard's major American distributors." Prosecutors allege that Sullivan sold cocaine through distributors in Encinitas, San Francisco and Austin, Tex.
Others identified by the indictment as major distributors are: Frank Len Jackson, Thomas Richard Pool and John Stevenson Kerr, of Encinitas; Randolph C. Barsotti, of San Francisco, and Javier Herroz Bernal of Austin.
Those arrested were arraigned in federal court here under heavy security.
Prosecutors said that Sullivan's cocaine distribution was fronted by a business called Conceptual Artists. The firm, at 808 Imperial Ave., San Diego, manufactures tables for restaurants.
Among the items seized from Sullivan were a Mercedes-Benz, a Porsche, two Peugeots, three other automobiles and about $1 million in stocks and bonds. Prosecutors suspect that the assets were purchased with illegal drug profits.
Several luxury cars and jewelry items were also seized from Jackson, who allegedly distributed cocaine purchased from Sullivan. Some of the items seized from Jackson include two Porsches, a BMW, a 1984 Maserati, four other autos and an undetermined amount of cash from three bank accounts, all suspected of stemming from illegal drug profits.
As are Sullivan and Jackson, Charles (Carlos) Jones, 22, of Del Mar is being held without bail.