On Friday, a federal grand jury in the Eastern District of Texas returned an indictment related to a complex international drug trafficking investigation. The matter focuses on alleged activities surrounding the registration of numerous aircraft by an east Texas company, Aircraft Guaranty Corporation (AGC). The aircraft identified in the investigation were reportedly purchased and operated by foreign corporations or individuals. The Texas/Oklahoma based company was named in the indictment along with other co-conspirators.
The indictment charges eight individuals with multiple criminal offenses. Debbie Mercer, 58, and Kayleigh Moffett, 33, both of Oklahoma City; Federico Machado, 53, of Florida; Carlos Villaurrutia, 40, of McAllen, Texas; and four others were named, according to Acting U.S. Attorney Nicholas J. Ganjei. All are facing charges of conspiracy to manufacture and distribute cocaine, conspiracy to commit money laundering, conspiracy to commit wire fraud, conspiracy to commit export violations, and conspiracy to commit federal registration violations involving aircraft. The indictment accounts for approximately $350 million in alleged criminal activity since 2016.
“The threat posed by transnational crime cannot be overstated,” said Acting U.S. Attorney Nicholas J. Ganjei. “The use of United States-registered aircraft by these criminal organizations and their networks of associates poses a clear and present danger to the security of our nation. The American public can expect EDTX to be relentless in its fight against the sometimes invisible, but always dangerous, threat of transnational organized crime.”
The Organized Crime Drug Enforcement Task Force (OCDETF) investigation involving multiple federal, state and local authorities was initiated after a news story highlighted more than 1,000 aircraft registered with the Federal Aviation Administration by Aircraft Guaranty Corporation in Onalaska, Texas. The city has no public airport and the addresses used in the registration process were PO boxes reportedly used by AGC.
Although there are strict regulations regarding the registration of United States aircraft with the FAA, those regulations were allegedly skirted by individuals and corporations outside the company. By transferring aircraft into a trust held by Aircraft Guaranty Corporation, foreign corporations and individuals were reportedly able to register the aircraft as domestically owned. By registering the aircraft using the trust company as an intermediary, ownership and operation of the aircraft becomes sketchy. The tail number of the aircraft, which were known to operate around the globe, bear a tail number beginning with the letter “N,” a designation noting American ownership.
The tail number is transmitted by the aircraft’s transponder during flight. Air traffic controllers receive the information by radar along the aircraft’s flight path. The N designation can add legitimacy to a flight possibly involved in criminal activity anywhere across the globe. In this case, the purchase and U.S. registration of aircraft by foreign corporations and individuals was allegedly designed to allow transnational criminal organizations in Colombia, Venezuela, Ecuador, Belize, Honduras, Guatemala, and Mexico to smuggle large quantities into the United States.
Massachusetts Congressman Stephen Lynch has twice introduced a bi-partisan bill, the Aircraft Ownership Transparency Act, to address loopholes in FAA regulations by reducing the secrecy surrounding aircraft registration.
Randy Clark is a 32-year veteran of the United States Border Patrol. Prior to his retirement, he served as the Division Chief for Law Enforcement Operations, directing operations for nine Border Patrol Stations within the Del Rio, Texas Sector.
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