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The World

Calderon hails arrest in cash case

The owner of a mansion in Mexico City where $207 million was found is arraigned in the U.S.

July 25, 2007|Hector Tobar | Times Staff Writer

MEXICO CITY — A week ago, Zhenli Ye Gon was the toast of the Mexican media.

Speaking to reporters by telephone while in hiding, he said he would prove that senior officials of the government of President Felipe Calderon were responsible for the $207 million in illicit cash found in his Mexico City home.

On Tuesday, Ye Gon was in a U.S. courtroom, having been captured hours earlier at a restaurant in suburban Washington by U.S. agents who traced his cellphone. And Calderon was claiming victory in a case that officials say yielded the biggest haul of drug money in history.

"Today, those who commit crimes should know that my government will not spare any resources or effort to hunt them down wherever they may be, inside or outside our national territory," Calderon said at a speech at his alma mater here, the Free School of Law.

Agents of the U.S. Drug Enforcement Administration arrested Ye Gon in Wheaton, Md., on Monday night, about four months after police entered his Mexico City mansion on suspicion that he was running a methamphetamine production ring.

With its massive haul of cash, involving more than 2 tons of U.S. $100 bills, and allegations of official complicity, the case has come to symbolize the wealth and power behind the international trade in illicit drugs.

A 44-year-old naturalized Mexican of Chinese descent, Ye Gon was arraigned Tuesday in U.S. District Court in Washington on drug-trafficking charges. Mexican authorities alerted their U.S. counterparts last month that they thought Ye Gon was in the United States.

Mexican authorities have said they will request Ye Gon's extradition on a variety of drug-trafficking charges. If convicted in Mexico, he faces up to 73 years in prison.

U.S. authorities filed their own charges against Ye Gon last month.

On Tuesday, U.S. officials released an affidavit by a DEA agent in Mexico with new details on the scale of Ye Gon's alleged operation. He is said to have imported enough chemicals to produce methamphetamine worth $724 million on the street.

A note discovered at Ye Gon's home refers to apparent assistance from corrupt Mexican customs officials, the affidavit said.

Ye Gon traveled often to Las Vegas to launder drug money and to gamble, the affidavit said. Between 2004 and 2007, records from Las Vegas hotels and casinos show, Ye Gon had gambling losses of $125.9 million.

The DEA also conducted tests in April at Ye Gon's Mexican pharmaceutical plant and found ephedrine, a stimulant and decongestant used to manufacture methamphetamine.

Martin McMahon, a Washington lawyer representing Ye Gon, told the Associated Press that the charges against his client were "complete nonsense.... He has never had drugs, and he didn't have any drugs on him when he was arrested."

If he is extradited, Ye Gon will not receive a fair trial in Mexico, McMahon said.

"President Calderon has already said he is going to jail," McMahon said. "We will vigorously oppose his extradition."

In statements made before his arrest, Ye Gon said Mexican officials had forced him to store the money in his home. He said the funds were destined for use in Calderon's 2006 presidential campaign and "terrorist" activities. Calderon called the statements a "tall tale."

Ye Gon's arrest comes amid growing concern in Mexico that his alleged drug operation may have flourished thanks to the complicity of corrupt officials.

According to news reports here, an investigation by the Mexican attorney general's office is focusing on the role of drug regulators and of a high-ranking tax and customs official, Luis Roberto Patron Arregui.

The investigation has found that Patron Arregui assisted Ye Gon by providing false documents that allowed Ye Gon's company to import chemicals required to produce pseudoephedrine, also a precursor to methamphetamine.

During the administration of President Vicente Fox, Patron Arregui ran the customs office at the Pacific port of Manzanillo.

After winning the presidency last year, Calderon named Patron Arregui to head the national customs office, but Congress refused to even hold confirmation hearings because of allegations that he was corrupt.

Patron Arregui instead became the No. 2 official in Mexico's tax collection agency. He is related by marriage to the Coppel family, a key backer of Calderon's presidential campaign.

--

hector.tobar@latimes.com

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