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July 25, 2019Chicago, IL, United StatesNarcotics

Former Chicago resident sentenced to 5 years in federal prison for laundering drug cartel money

CHICAGO — A former Chicago resident, who laundered illegal drug proceeds on behalf of two cartels in Mexico, was sentenced Wednesday to five years in federal prison.

This sentence was announced by the following agency heads: U.S. Attorney John R. Lausch Jr., Northern District of Illinois; Special Agent in Charge James M. Gibbons, U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Acting Special Agent in Charge Tara Sullivan, Internal Revenue Service’s Criminal Investigation Division in Chicago; and Special Agent in Charge Timothy Jones, Chicago Field Division of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives.

The following agencies also provided substantial assistance to this investigation: U.S. Drug Enforcement Administration, Cook County (Illinois) Sheriff’s Office, DuPage County (Illinois) Sheriff’s Office, Chicago Police Department, Buffalo Grove (Illinois) Police Department, Joliet (Illinois) Metropolitan Area Narcotics Squad, and the U.S. Marshals Service.

Mario Herrera, 55, from Michoacán, Mexico, and formerly of Chicago, was a member of a Mexico-based conspiracy that laundered more than $100 million in narcotics proceeds on behalf of the Jalisco New Generation and Sinaloa drug cartels.

Herrera was personally responsible for laundering or attempting to launder at least $1.07 million in proceeds from the sale of cartel narcotics.

Herrera was among 30 defendants charged as part of the Chicago-based federal investigation dubbed “Operation King’s Gold.”

Herrera pleaded guilty last year to one count of conspiracy to commit money laundering.

U.S. District Judge Andrea R. Wood, Northern District of Illinois, imposed the five-year prison sentence.

“This sentence sends a resounding message that transnational criminal organizations will be investigated, and their operatives brought to justice,” said Special Agent in Charge Gibbons. “The amount of cooperation between HSI and our state, federal and international partners is invaluable to halting the deadly actions of complex drug trafficking organizations.”

“Money is the lifeblood that allows cartels to poison U.S. streets and wage war on innocent men, women, and children on both sides of the border,” Assistant U.S. Attorneys Peter M. Flanagan, Sean K. Driscoll and Aaron R. Bond argued in the government’s sentencing memorandum.

Herrera “took part in an organization that shuttled over $100 million in drug proceeds from street corners of the United States to the pockets of the individuals in Mexico who control the drug trade. The people who import these narcotics do so for money, and that is exactly what the defendant delivered.”

“The laundering of illegal drug profits is as important and essential to drug traffickers as the very distribution of their illegal drugs,” said IRS-CI Acting Special Agent in Charge Sullivan. “Without these ill-gotten gains, the traffickers could not finance their organizations. IRS Criminal Investigation, along with the Department of Justice, is committed to taking the profit away from the drug traffickers and putting those individuals in jail.”

The leader of the money laundering organization, Diego Pineda Sanchez, of Guadalajara, Mexico, was sentenced last fall to 15 years in federal prison for laundering more than $61 million in drug proceeds.

Pineda Sanchez personally negotiated agreements with drug cartel members in Mexico to launder drug profits in exchange for percentages of the laundered proceeds, keeping the largest percentages for himself and co-defendant Carlos Parra-Pedroza.

Parra-Pedroza, of Guadalajara, Mexico, directed members of the conspiracy to collect drug proceeds from dozens of couriers throughout the U.S., use those proceeds to purchase scrap and fine gold from local U.S. businesses, and then ship the gold to refineries in Florida and California.

The refineries, in turn, transmitted the cash value of the gold to Parra-Pedroza and co-conspirators in Mexico.

From 2011 to 2014, Parra-Pedroza personally managed the movement of more than $100 million in drug proceeds from the U.S. to cartel members in Mexico who controlled the drug trade on both sides of the U.S.-Mexico border.

Parra-Pedroza was repeatedly heard in undercover recordings boasting about his organization’s connections with the violent cartels.

During a June 2013 meeting in which Parra-Pedroza urged an informant to more quickly launder the cartel’s money, Parra-Pedroza told the informant about an incident in which drug dealers punished a man who had lost their money by taking his personal possessions and “chopp[ing] off his fingers.”

Parra-Pedroza endorsed this maiming, stating, “[Expletive] had to, even I would’ve agreed.”

In another meeting with the same informant and an undercover law enforcement agent who posed as a gold supplier, Parra-Pedroza explained that the couriers who transport cartel money are entrusted to do so because they “leave their families and everyone over there” in Mexico, and cartel members there tell them, ‘If you take off, I will kill your entire family here.’”

The Organized Crime Drug Enforcement Task Force (OCDETF) investigated this case. OCDETF is a partnership between federal, state and local law enforcement agencies, whose principal mission is to identify, disrupt and dismantle the most serious drug trafficking and money laundering organizations.

Judge Wood in December sentenced Parra-Pedroza to 13 years in federal prison.

Updated: 07/26/2019