For José Treviño Morales and Eusevio Huitron, the allegations that embroil them in a multimillion-dollar money laundering investigation stem all the way back to Tempting Dash.
Owned by Treviño and trained by Huitron at a ranch near Bastrop, the prized American quarter horse stole the finish line in the 2009 Texas Classic Futurity at Lone Star Park near Dallas, winning more than $490,000 in one of the richest competitions in the sport.
The earnings allowed Treviño to kick start Tremor Enterprises, a profitable Oklahoma company with some of the most popular champions in the world of professional horse racing. But prosecutors say the funds that made it all possible for the mason and father of four — starting with the purchase of his first horse — came from an illegitimate source: the criminal dealings of his brothers, Miguel Angel Treviño Morales and Oscar Omar Treviño Morales, top leaders of the vicious Zetas cartel.
Treviño and Huitron are two of the five defendants standing trial this month in the money laundering case, one of the largest ever prosecuted in an Austin federal court and which has given a glimpse into how the sophisticated narco-trafficking group has sowed fear and wielded political influence in Mexico as it spread its tentacles deep into the United States.
Also on trial are Mexican businessman Francisco Colorado Cessa, professional horse trainer Fernando Solis Garcia and Huitron’s brother, Jesus Huitron. It is expected to last at least another week, during which defense attorneys will present their cases.
Over the past two weeks of testimony, a group of inmates who once worked together for the Zetas have described an elaborate scheme that allowed the Treviño brothers to sell cocaine from Colombia and Venezuela as far north as Chicago and move the proceeds back south, along with assault weapons bought at Texas and New Mexico gun shows.
Those funds, prosecutors say, were moved back into U.S. banks via wire transfers, personal checks and other financial transactions by several of the defendants — and their unknowing accomplices — to be poured into front companies across the Southwest that bought, trained, bred and raced American quarter horses.
At least two entrepreneurs involved were killed, witnesses said, including Ramiro Villarreal, a prominent horse buyer who died in a fiery crash after the Drug Enforcement Administration divulged to the Mexican army that he was cooperating with U.S. authorities and the army alerted the cartel. Another affluent businessman was kidnapped and tortured.
Alfonso Javier Del Rayo, a real estate mogul in the Mexican state of Veracruz, testified that he was forced to buy a $310,000 horse for cartel associates to race and then loan hundreds of thousands of dollars for horse-related expenses to Colorado and Carlos Nayen Borbolla, another defendant implicated in the case, after gang members held him for ransom in a secured house for nine days in December 2010.
Del Rayo said his captors bashed his head and body with the butts of their assault rifles, ripping gashes across his face and forehead and breaking two of his fingers.
Former traffickers told jurors that Colorado built up his own company by channeling millions of Zetas drug money to a former governor of Veracruz in exchange for government contracts from Petróleos Mexicanos, or Pemex, Mexico’s state-owned petroleum company.
But the intricate network of traffickers, wealthy investors, industry insiders and ranchers involved both associates and victims ignorant of the scope of operation. The challenge for the government will be proving which of the men on trial was connected to the criminal organization.
As prosecutors piece together the complicated case, jurors will have to decide how much to believe from those witnesses who are serving time for drug charges and have entered plea agreements for lesser sentences in exchange for testifying. At least two are accused of murders and kidnappings in Mexico.
Defense attorneys have described their clients as hardworking and honest businessmen with humble roots and a passion for horses they acquired at early ages. Eusevio Huitron, known as “Chevo,” his attorney Richard Esper said, is illiterate and has limited education.
José Treviño Morales woke up at 5 a.m. to tend to his ranch, and he didn’t want anything to do with his brothers or drugs until Tempting Dash, some witnesses have testified.
But over the course of 20 years, he and his wife, Zulema Treviño, jointly didn’t make more than $50,000 a year, as he worked in masonry and construction and she was employed by a temp agency, testified Michael Fernald, an agent with the criminal investigations division of the IRS.
“They did not have any disposable income,” he said. No records showed that Treviño had received an inheritance to buy a horse or that he had paid any horse-related expenses until after Tempting Dash won its first race, Fernald said. After that, his company more than doubled in earnings each of the next two years.
Bank records and financial statements of the other defendants, such as Solis Garcia and the Huitrons, showed they had received “structured payments” for their training and other horse-related expenses in increments of less than $10,000 to avoid reporting requirements, another IRS agent testified.
In a winner’s circle photo from the 2009 Texas Classic Futurity, José Treviño Morales stands next to his prized racehorse with his son and daughter. His children flash the numbers “40” and “42” with their fingers.
The seemingly innocent gesture, authorities say, pays homage to their Zetas uncles – alleged to be two of Mexico’s most notorious and ruthless capos — whose nicknames include Z-40 and Z-42. The family says they shouldn’t be targeted because of their bloodlines.