CASINO TIES TO PAN CANDIDATES

UNCLAS MONTERREY 000259

C O R R E C T E D C O P Y - TO CHANGE CABLE CLASSIFICATION TO:

SIPDIS

E.O. 12958: N/A
TAGS: SNAR KCRM PGOV CASC ASEC MX
SUBJECT: CASINO TIES TO PAN CANDIDATES


1. (C) Summary. During this year?s midterm elections, President
Calderon has accused opposition party governors of skimping in
the war against the cartels and PAN party president German
Martinez has directly blamed Nuevo Leon Governor Gonzalez Paras
(PRI) for the increased violence in that state. However, at the
local level PAN party officials often times are lacking in
transparency. The death of a Beltran-Leyva cartel boss in San
Pedro has brought renewed attention to the pernicious influence
casinos play in campaign politics. End Summary.

2. (C) In a June 26 enforcement action in Monterrey, the
Mexican military detained Omar Ibarra Lozano, alias ?El 34? or
?Caballo?, the Beltran-Leyva cartel?s plaza boss for San Pedro
and the presumed triggerman in the 2006 assassination of Marcelo
Garza y Garza, the director of Nuevo Leon?s state investigative
agency. Ibarra was captured only one month after the capture of
his predecessor Rodolfo "El Nito" Lopez Ibarra, who himself had
only been in power three months following the capture of his
boss, Hector "La Burra? Huerta Rios. The killing of Garza y
Garza ushered in a wave of violence in Nuevo Leon, which, in
part, prompted President Calderon to send in army forces into
the state to take on the cartels shortly after his inauguration
in 2006.

3. (C) Ibarra was arrested a few hours after the murder of
Rogelio Garza Cantu, also known as ?El Diablo? or the ?Czar of
Strip Clubs.? Garza was the owner of a large casino in
Monterrey and a number of strip clubs in the metropolitan area.
A source familiar with casino operations in the area reported
Ibarra was arrested after returning from a meeting with Juan
Jose (?Pepe?) Rojas Cardona, who is widely believed to have
orchestrated Rogelio Garza?s assassination. Pepe Rojas along
with his brother Arturo Rojas are the largest casino operators
in the metropolitan area. (Pepe Rojas was also the subject of
an unsuccessful assassination attempt in an up-scale area of San
Pedro during the fall of 2007.) Since casino licenses are
assigned by the federal government to specific individuals,
Rodrigo Garza?s casino will no longer be able to operate, thus
allowing the Rojas brothers to consolidate control of casinos in
the Monterrey region.

4. (C) Casinos are profitable cash businesses and often used to
launder illicit profits. According to our source, the Rojas
brothers have close ties to the Beltran-Leyva Cartel. The
connection to the Beltran-Leyva Cartel and separate ties to PAN
politicians allow the Rojas brothers to operate in an otherwise
Gulf Cartel region. Our interlocutor stated that in the 2006
elections, the brothers illegally donated US$2.5 million each to
Adalberto Madero, the current mayor of PAN Monterrey, and
Zeferino Salgado, the current PAN mayor of San Nicholas and the
PAN?s candidate for federal deputy for the San Nicholas
congressional district. In this year?s election, the Rojas
brothers reportedly donated a helicopter and free campaign
advertising to Salgado, who is expected to win in the upcoming
elections. In addition to campaign contributions, Madero and
Zeferino are said to also receive a monthly percentage of the
revenue from the casinos.

5. (C) Comment. The traffickers, the casino operators, and
corrupt politicians form a self-protective triangle, which makes
it difficult for honest law enforcement officers to get at
organized crime. One way for the Mexican government to strike
back at the cartels would be to take a fresh look at its policy
on casino licenses. End Comment.

WILLIAMSONB