BLUE LANTERN PRE-LICENSE END-USE CHECK ON LICENSE

UNCLAS MEXICO 003530

SENSITIVE
SIPDIS

FOR PM/DTCC - BLUE LANTERN COORDINATOR, WHA/MEX, AND INL/LP

E.O. 12958: N/A
TAGS: ETTC KOMC SNAR MX
SUBJECT: BLUE LANTERN PRE-LICENSE END-USE CHECK ON LICENSE
050123038

REF: STATE 102661


1. (SBU) SUMMARY: Mission Mexico has uncovered a
misstatement on the license request by Transportadora de
Proteccion y Seguridad (TPS) in conducting a pre-license
end-use check (reftel). Although TPS did not identify the
correct end-user of abrasion resistant steel plates from U.S.
supplier Kambio Corporation, experience suggests that TPS is
a bona-fide company that fulfills all documentary and
security requirements. TPS armors vehicles for U.S. and
Mexican government entities, including the Ambassador's car
and CG's vehicle in Monterrey, and some of the largest
businesses in Mexico. TPS indicated that it misunderstood
the new licensing requirement and would be willing to
resubmit its application. END SUMMARY.


2. (SBU) Poloff spoke by phone to General Manager Rodolfo
Amozurritia of Transportadora de Proteccion y Seguridad, S.A.
de C.V. (its commercial name is TPS Armoring) based in
Monterrey October 31 as well as Fernando Macias of Transcarga
November 10 about the end-use check on license 050123038
(reftel) for abrasion resistant steel plates. In the course
of these exchanges, it became evident that TPS already had
delivered an armored vehicle to end-user Transcarga using
plates that TPS had acquired previously when the current
end-use check was not required. Amozurritia acknowledged
that with the purchase of new steel plates per the license
under review, TPS had hoped to create a running stock of
plates that it could use as orders came in.


3. (SBU) At Embassy Mexico's request, Monterrey Consulate
Poloff visited TPS and met with Chairman and CEO Enrique
Herrera and General Manager Amozurritia November 24 for
further information on the end-use license under review.
Herrera and Amozurritia conveyed some confusion about the
State Department's end-use check process. In the past, TPS
had ordered its parts from the U.S. without having to
identify the ultimate recipient of each part ordered. To
meet running requests from a variety of customers, both
governmental and private, the company sought to place orders
on a monthly basis. To meet requirements under the licensing
process, TPS had identified Transcarga as an end-user.
Ultimately, however, TPS made delivery of an armored car to
Transcarga with plates that had come in while it was waiting
on the State Department license to be approved.


4. (SBU) Speaking to TPS' business record, Herrera and
Amozurritia explained that 50 percent of its sales go to
Mexican (including the Attorney General's Office (PGR),the
Preventive Federal Police (PFP),the Secretariat of Public
Security (SSP),CISEN, AFI and as many as 26 state
governments) and U.S. government entities (TPS armored both
the CG's car in Monterrey and Ambassador Garza's car and has
provided service to both the DEA and FBI in Monterrey). The
other 50 percent of its sales are made with the private
sector, including the largest businesses in Monterrey, such
as Cemex, Alfa, Femsa and others. The company also sells to
U.S. companies like Caterpillar and Colgate. They showed
Poloff purchase agreements with CISEN, PGR and a private
company.


5. (SBU) TPS maintains that it satisfies all documentary
requirements on transactions, including permits and
registration with SSP. The company places an authentication
seal on each vehicle it manufactures with a logo to attest to
its origin. It fully understands that the items from the
U.S. source, Kambio Corporation in Miami, Florida, are not to
be re-transfered or re-exported. Until now TPS has only sold
its products to government entities or Mexican private sector
companies. Herrera and Amozurritia showed Poloff its secure
facilities and affirmed that the company uses proper
accounting and security procedures. The company serves many
states in Mexico and has a sales office in Mexico City.


6. (SBU) TPS is owned by Enrique Herrera, who founded the
company in 1994. He and Amozurritia are in the process of
selling the company to the O'Gara Group, which they said is
the most well-known and respected U.S. armored car company,
but that the sale is not final. After the sale, Herrera and
Amozurritia plan to remain in the company's management. More
information about TPS can be found on the company website at
www.tps.com.mx.


7. (SBU) COMMENT: Consulate Monterrey's long experience with
TPS suggests it is not only a legitimate firm but has proven

a reliable partner to the Consulate's U.S. law enforcement
(FBI and DEA) community. Monterrey's FBI office has heard no
derogatory information about TPS and services its cars with
the company. TPS told Monterrey's FBI representatives that
it has no intention of selling armored cars to
narcotraffickers as it does want to risk getting caught up in
battles between the cartels. It also said that it does not
accept orders for armored cars with secret compartments or
gunholes from which you can shoot. Indeed, Monterrey's FBI
Office indicated that it would face a hardship identifying as
reliable a supplier as TPS were the USG's relationship with
the company curtailed. TPS has conveyed a willingness to
resubmit an application to the State Department that would
enable it to continue receiving abrasion resistant steel
plates from U.S. suppliers for the production of armored
vehicles. To the extent it receives a running order of
requests from a wide range of governmental and private
requests for armored cars, TPS would like to explore the
possibility of filing licenses in a manner that would enable
it to create a running stock of steel plates.
Notwithstanding Mission Mexico's determination that the
presumption in reftel that the controlled items are to be
used in an armored vehicle for the end-user Transcarga is not
correct, everything suggests TPS is a bona-fide company that
seeks to satisfy in full State Department licensing
requirements that would allow it to continue purchasing its
product from U.S. suppliers in the future. END COMMENT.

Visit Mexico City's Classified Web Site at
http://www.state.sgov.gov/p/wha/mexicocity and the North American
Partnership Blog at http://www.intelink.gov/communities/state/nap /
GARZA