THE CAPTURE OF AMERICA'S MOST WANTED

By Kevin Fedarko

IN THE TOWN OF VILLA JUAREZ, just south of Monterrey, 15 Mexican drug agents spent most of Jan. 14 crouched outside a walled ranch house. The agents had received a critical tip: Juan Garcia Abrego, one of Mexico's most powerful drug dealers, was inside. At 7 p.m., the team moved in. They smashed through the front gate in a minivan, taking Garcia Abrego and two bodyguards by surprise. As the druglord dashed out a back door and tried to launch his portly frame over a fence, agents grabbed him by the shirt. Twenty minutes later, the man who had shipped perhaps a third of the cocaine consumed in the U.S. during the past decade was in handcuffs and on his way to Mexico City.

At first, he remained calm, joking with his captors that "you're going to be hearing from me." But by the time Garcia Abrego reached the capital, President Ernesto Zedillo Ponce de Leon had already decided against keeping him in Mexico. Instead, the President ordered him hustled onto a jet and flown to the U.S., where he is wanted on 20 charges, including drug trafficking, money laundering and murder, and is featured on the FBI's 10-most-wanted list. (He is the first international drug dealer ever to make that dishonor roll.) When he realized where he was headed, Garcia Abrego lost his composure. At the Mexico City airport, agents had to drag him from the car and hoist him up the steps to the plane. On board, he looked at the eight agents escorting him to Houston and told them, "You are all dead men."

Garcia Abrego is a prize trophy in Mexico's campaign against drug dealing. For most of the past 10 years, he has been serving the Colombian cartels by smuggling their cocaine from Mexico into the U.S., distributing drugs in half a dozen American cities and earning as much as $2 billion a year in the process. Ruthless, violent and vain (last year he underwent an operation to trim back his bulbous nose), he spent millions each month bribing a network of corrupt officials in the government. Those payments made him untouchable during the administration of former President Carlos Salinas de Gortari. Now, however, they make him dangerous: the list of public officials in his pocket could cause a scandal of enormous proportions.

That may help explain why he was dispatched to the U.S. with such haste. The Mexicans say they expelled him because they feared they could not prevent him from running his business while awaiting trial. But there is also the issue of the judges, police officials and possibly even Cabinet members who may have been accepting his bribes. In Mexico the pressure to suppress Garcia Abrego's information about corruption could be overwhelming, so it is more likely to come out in a U.S. court. The expulsion may thus be a reflection of Zedillo's commitment to rooting out corruption. "There is a better chance that the truth will emerge in the U.S.," says a senior Mexican official. "We aren't afraid of that happening."

There are many, however, who should be. Among them may be former President Salinas and his brother Raul. After Zedillo's election, both men fell into disgrace: Raul is now in jail near Mexico City and Carlos is living in self-imposed exile in Cuba. Raul was originally arrested for his alleged role in the murder of Jose Francisco Ruiz Massieu, secretary-general of the ruling Institutional Revolutionary Party. But evidence has recently surfaced suggesting--although not yet proving--that he may have been linked with Garcia Abrego's gulf cartel. Perhaps most damning is the suspicion that when Salinas was President, Raul allegedly used his influence to grant favors to the gulf cartel.

Making billions is only half the drug baron's task; the other is figuring out what to do with them. Trucks and cars carrying huge amounts of drug money continually cross into Mexico from the U.S. "They're bringing in tons of dope," says Thomas Constantine of the U.S. Drug Enforcement Administration. "There's no reason they can't take tons of money back the same way, in bulk cash." Of all the Mexican drug barons, Garcia Abrego was probably the cleverest at figuring out ways to introduce such tons of cash into the financial system without drawing attention to their source.

In 1993 authorities did unravel one of his money-laundering schemes, which typifies their complexity. Cash earned in the U.S. was smuggled to Mexico and handed over to a Monterrey currency exchange. Couriers then flew or drove the funds back to the U.S. and deposited them in the exchange's bank account in McAllen, Texas. Then, with the help of two directors at the American Express Bank International in Beverly Hills, California, the money was wired to the Manhattan accounts of Cayman Islands holding companies, and from there to investments stretching from Texas to Switzerland. In this way, the real owners of the money were hidden from tax men and regulators.

In recent years Mexico has replaced Panama as the leading drug-money Laundromat in Latin America. And much of the money stays in Mexico. Aided by lax government regulation and the willingness of Mexican banks to accept suitcases full of cash without asking questions, drug barons have been able to squirrel billions of dollars into legitimate businesses; Garcia Abrego owns dozens of such businesses, including computer stores, car dealerships and meat-packing plants. The effect on the economy can be pernicious. Since businesses supplied with capital from drug dealing don't have to worry about profits, efficiency or paying interest, they can drive out legitimate enterprises. "It's a little like cocaine itself," notes Andrew Reding of the World Policy Institute. "You get a quick rush that may make you feel better in the short run. But in the long run, the destructive effects are greater."

The timing of Garcia Abrego's arrest has raised questions. On March 1, Clinton is due to grade or "certify" Mexico for its antinarcotics efforts, and Zedillo has been accused by Mexican and U.S. critics of conveniently offering up Garcia Abrego to ensure that Mexico is treated to a favorable review. Since Garcia Abrego has been losing ground for a couple of years, the theory goes, his arrest is really only a token, while more powerful drug barons are allowed to operate. Yet Zedillo does seem to be more sincere about curbing corruption and the drug trade than some of his predecessors. The very reason Garcia Abrego's power has waned is that he has been under intensified pressure from the Mexican government's ongoing manhunt.

Unfortunately, Garcia Abrego's arrest will not reduce the flow of drugs from Mexico into the U.S. for long. American agents have been told that Amado Carrillo, Mexico's No. 1 trafficker, is now sitting on 75 tons of cocaine. Regardless of Garcia Abrego's fate, that stockpile will no doubt eventually make its way to the streets of Los Angeles and New York and Chicago.

--Reported by Deborah Fowler/Houston, Laura Lopez/Mexico City and Elaine Shannon/Washington

With reporting by DEBORAH FOWLER/HOUSTON, LAURA LOPEZ/MEXICO CITY AND ELAINE SHANNON/WASHINGTON