Wednesday, September 3, 2014

The Strange Case of a Drug-War Informant, a Ferrari and an Alleged Kidnapping

Posted By on Wed, Sep 3, 2014 at 10:48 AM

Page 4 of 4

A few months after the arrest of Santillan, Lalo was living under protective custody and working as a shopping-center security guard in San Antonio when he made the fateful decision to return to the border region of Juárez for a few days.

The trip had a dual purpose. Lalo, whose ex-wife and kids were also living under government protection in San Antonio, wanted to visit his then-girlfriend in El Paso. He also had arranged to pick up some money at an El Paso Whataburger. Lalo says that the money drop was tied to some work he was still doing for ICE, but federal agents say that's not correct. They suggest the money stemmed from the proceeds of some property Lalo had recently sold in Juárez.

Whatever the case, the ever-wary Lalo sent a friend to the Whataburger to collect the money. Lalo's fill-in was sitting in his car in the restaurant parking lot when a gunman appeared out of nowhere and pumped four bullets into his chest before disappearing.

The cover of September 4 RFT.
  • The cover of September 4 RFT.

Lalo's friend, who also happened to be an FBI informant, died instantly, and ICE swept in and placed Lalo under lock and key. Over the next six years ICE moved Lalo from prison to prison, in Texas, Minnesota and finally New York — while pressing deportation proceedings against him. Eventually Lalo was freed after convincing a U.S. appeals court that he would be murdered with the Mexican government's acquiescence if sent back to Mexico.

Last year Lalo filed a $125 million lawsuit against former and current officials with ICE and the Department of Justice, among others, claiming they violated his constitutional rights by conspiring to keep him imprisoned against his will for years, while seeking to return him to Mexico where he would likely be murdered. Lalo, who earned more than $200,000 as confidential source SA-913-EP, also claims ICE still owes him $400,000 for his undercover work. The case, filed in U.S. District Court for the Western District of New York, is sealed and still pending.

Lalo believes it's because of that lawsuit, and the damage it could to do current and former government officials, that he remains locked up in Newton County.

ICE spokesperson Danielle Bennett says she's not familiar with Lalo's kidnapping case in Missouri, but sees no merit in his claim.

"When a local authority has someone on criminal charges, that's not an influence that we would have," she says. "If he's got criminal charges, it would be the local authority that is setting the limits for keeping him in their custody."

However, Steven Cohen, the Buffalo attorney handling Lalo's federal civil lawsuit, says he is quite certain "the U.S. Attorney's Office and the Department of Justice are well aware of Lalo and the particular embarrassing facts and events he is witness to, and will do all they can to marginalize him."

Gonzalez, the DEA agent who blasted his colleagues in ICE upon learning of Lalo's involvement in the House of Death, echoes Cohen's take: "I think [the DOJ and ICE] would have reason to do whatever they could to prevent that lawsuit from ever seeing light of day from a trial."

The now-retired Gonzalez, who won a civil suit against the government after his bosses gave him poor job marks in the wake his complaints about ICE's handling of Lalo, asserts that the coverup in the House of Death murders went to the top of the U.S. Department of Justice. In testimony in Gonzalez's civil case, former DEA administrator Karen Tandy confirmed that she "personally briefed" then-Attorney General John Ashcroft and Deputy Attorney General James Comey (now head of the FBI), on the House of Death affair after Santillan targeted the DEA agent.

Ashcroft, who now heads a Kansas City-based law firm that bears his name, did not return calls for comment. Nor did Johnny Sutton, the former U.S. Attorney for the Western District of Texas, who now works for Aschroft's law firm and who oversaw the House of Death case as the top U.S. prosecutor in southwest Texas.

ICE agents and prosecutors claim in court pleadings that they were not kept in the loop on Lalo's murderous activities because his handler failed to properly brief them. That agent was ultimately served up as a scapegoat and fired by the agency. But ICE and DEA also conducted a subsequent joint investigation into the House of Death case, the results of which have never been made public — despite several Freedom of Information Act requests seeking the report. Lalo's pending civil case, if it proceeds, could result in the release of that report as part of the discovery process.

Back in Missouri's Newton County, prosecutor Jake Skouby says no one from the federal government has contacted him about Lalo.

Joplin PD's Stewart, though, says officers with his department work with federal law enforcers from the FBI, DEA and ICE on various task forces, "and they are aware of [Lalo's] case and have talked about it. But as far as I'm aware, they haven't done anything with it."

Lalo remains unconvinced.

"They are trying to portray me as a kidnapper, which is not true," he says. "In my mind, I knew from the beginning from what my public defender told me. She said, 'Oh, we got a big case here. They will make it a high-profile case because of who you are...that you were a member of a cartel.'"

Lalo stresses that the only current tie he has to the cartel is this: "They want to kill me."

Bill Conroy is a freelance reporter who's written extensively about Lalo and other players in the Mexican-U.S. drug trade for the website Narco News. He can be contacted at

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