Reporting on the Mexican Cartel Drug War

An Asian Connection

Thursday, January 24, 2013 |





ACI - Borderland Beat
http://armchairsborderwars.blogspot.com/


Ye Gon

Most who follow the drug war are familiar with the story of Zhenli Ye Gon, the china man whose house was filled with upwards of 300 million dollars. Some of the money was hidden throughout the walls, in file cabinets but most remember the now iconic image of a gigantic pile of cash in a corner room at his residence in Lomas de Chapultepec in Mexico City. He was the legal representative of Pharm Chem México, a position he used to traffic pseudoephedrine and ephedrine precursor chemicals for large scale production of methamphetamines. He was arrested in 2007 and even though his case was dismissed in the US in 2009, he is still pending charges in Mexico. As of this writing Zhenli Ye Gon continues to be held in US custody. Zhenli Ye Gon is fighting extradition to Mexico.












What ever happened to the rest of his network? According to court documents we are led to believe that the man behind one of the largest pseudoephedrine networks in the world was only working with a handful people? More troubling still is that out of those found to be involved in Ye Gon's network many were found innocent after the prosecution failed to prove several "aspects" of the case. My favorite included the following: The prosecution did not identify weather the substance (methamphetamine) was a narcotic or psychotropic drug.



















There is no doubt that elements of this network continue trafficking pseudoephedrine and ephedrine precursor chemicals for a number of reasons. There have been numerous seizures since 2007; including a 15 ton seizure in 2012 which was the largest seizure in history. There has been an increase in the size and scope of these operations since Zhenli Ye Gon's downfall. With several cartels in Mexico heavily reliant on the proceeds from methamphetamine it is likely that Ye Gon's network of connections back in China would prove too valuable to merely let vanish.


Wong Ryu Hyo is a man few have heard of; he is thought to head what is left of Zhenli Ye Gon network in Mexico. His main base of operations is in Tepito; a rather famous slum in Mexico City. It is renowned for its open markets and fiercely proud people. The type of markets rife with pirated copies of Taylor Swift and 2Pac, knock off booze, stolen car engines and any other item which could be resold at bargain rates. It is said, "En Tepito todo se vende menos la dignidad" or the only thing not for sale is our dignity.


The streets are jammed with merchandise, leaving not an inch to spare. A constant chatter fills the market, the hum of people wheeling and dealing never stops. Stalls dart out in every direction and the people are everywhere. If you need something cheap and fast Tepito is the place to go and if you can't find it here then there is a good chance you will never find it. Most of the stalls are off the grid, part of Mexico's informal economy which accounts for 1/3 of Mexico’s GDP by some estimates. It was back in the 1970’s that pirating knock offs took off in the area, now it sells more than simply pirated goods, it has become a place to find find anything. Literally anything.




Santa Muerte statues adorn many locations. There are many alters for her here. The market itself it said to be one of the oldest in Mexico and the resident here will let you know that. A place of pride, poverty, innovation and a bit of thievery all mixing together like pozolé. Along the narrow passage ways one may find an array of cooking dishes next to DVDs, right next to that an assortment of watches and childrens toys. A journalist reported that while he was there he was able to view a wide assortment weapons including hand grenades and in an odd but chilling display of exactly what’s for sale in Tepito; the reporter was offered a motorcycle and a handgun as a package deal. The more you buy, the greater the discount apparently. Strangely the reporter also said he was offered to rent the package, the seller told him that's what most do. In Central and South America motorcycle killings are common place. In addition the vendors bragged about some arms that were procured from corrupt officials within the military.
Tepito is also home to large Korean population who have invested heavily in shops around the area. It is thought that as many as 2500 Korean businesses operate here. It was this characteristic that helped Tepito go from locally manufacturing pirated merchandise to becoming one of the largest importers of pirated merchandise in Mexico, therefore the world. It was through these relationships an even more lucrative market presented itself. The market for methamphetamine or to be more precise, the illegal importation of precursor chemicals used to make the drug.


Wong Ryu Hyo is of both Korean and Chinese blood. An educated man, Ryu Hyo is fluent in several languages. He is not in the country legally even though he is well known in his barrio. He found a home within the Korean population of Tepito. He is one of the Triads main contacts in Mexico, thought to still be in charge of many shipments coming in from China. Some say he was actually the real power behind Zhenli Ye Gon.


He imports his chemicals from Yiwu, Zhejiang, China. Its a city of 1.2 million people known throughout the world for its own proclivity to manufacture counterfeit goods. It has recently become a major exporter precursor chemicals used in the manufacture of methamphetamine. Eamonn Fingleton once said “The city of Yiwu functions as a sort of 'Wall Street' for the counterfeiting industry, providing a vast marketplace where 100,000 counterfeit products are openly traded and 2,000 metric tons of fake products change hands daily.”


The chemicals arrive through a front company operated by a women referred to as Ms. Am Lam. The chemicals arrive at the Mexico City Airport and are unloaded under the watch of Lara Hermenegildo Lugo's people, then transferred to whomever ordered the shipment. The Asian TCO’s have little to nothing to do with the actual manufacture of methamphetamine; they simply provide Mexican TCO's with precursor chemicals and pirated goods.  While many seizures have taken place in cities such as Mazatlan and Boca Del Rio or Veracruz it is unusual for this type of operation to be based out of D.F.  Cargo shipments are more widely used than aircraft, this can be inferred by the number of seizures which have occurred.  It should also be noted that human trafficking also another major source of income for Asian TCO's operating within Mexico.

Lara Hermenegildo Lugo worked his way up through the system, holding many positions and posts. He became quite renown after successfully dismantling a kidnapping ring run by corrupt government officials. He was in charge of high priority cases involving drug dealing, car theft and kidnapping. He was promoted to a high position within the SSP after the successful dismantling of an infamous band of kidnappers. Lara Hermenegildo Lugo's father was the contact at the airport. It is often officials tasked with such responsibilities which Cartels treasure the most.

By most accounts this ring has operated without facing any real sustained pressure from the authorities, according to the information out there, they are ghosts. Zhenli Ye Gon may have been arrested but the network is by all accounts very much in tact, still being able to bring large consignments of precursor chemicals into Mexico. Huang Wei Chen Jie was a money man for Wong Ryu Hyo.   Some of his enforcers are Lee Young Gwang Suck, Han Heung Suck Shoi, Park Kang Hyo Sun.


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24 Borderland Beat Comments:

Anonymous said...

With a culture based in corruption so profoundly I don't think this country will ever be safe or fair for the actual mexican citizens.

Anonymous said...

so where did the 300 million go.

Anonymous said...

GREAT STORY BUT VERY,ON SO MANY LEVELS,DISTURBING!! First, WTF, is going on in the US GOVT., where he has the charges DISMISSED, but he's still in custody??? Is that some covert way of saying, "PROTECTED CUSTODY",???. Is this yet another story like "THE TWINS", in Chicago? It really is quite clear that once again, we aren't given a true account about yet another EVIL, GREEDY BASTARD. If it were not for BB, I doubt we would know anything. Thanks for the story,as always, even though it really angers me again about the freaking games being played here by "THE US GOV'T." Texas Grandma.

Anonymous said...

arm chair always brings great stories and they are always filled w details. great job aci! oh ya what about smoke filled rooms, when we gonna see the rest?

Anonymous said...

cr** man ... so that's where all the world's dinero has gone to. No wonder the rest of us are in a recession and have no jobs. This man's casa has got more money than the whole Bank of Mexico. Ha ha ha !!!!

Anonymous said...

Nice article....seen most of the stories before, pretty informative and a good read.

Anonymous said...

Reading this and another recent article made me wonder:

Is there any relation in this outfit to the group that included Emilio Chan (according to Ana Poniatowska) the bagman for Gen. Acosta Chaparro or his son Tony Chan?

Is the cartel guy's wife Insunza (sic) Chan referred to in another article last week somehow related to one or both?

I have been told that the Chinese mob was Mexicali-based and ran a lot of illegal gambling in Mexico. Anybody know anything?

Anonymous said...

armchair a lot of work but i am sorry the information is erroneous or old. can you list your sources? Asia has always been the worlds major source of precursor and the leading manufacture of the drug. 90 percentile. they ship premade and precursor. see the article on 3 Asian gangs here on BB.

刁李

Arm Chair said...

I don't know who he supplied or supplies, all I know is that the majority of the network is still at large and since I have yet to see any high profile arrests I have no reason believe they are not operational. For all I know this has nothing to do with the story on the 3 triads there maybe overlap or perhaps they are completely separate, I don't know.

Arm Chair said...
This comment has been removed by the author.
Arm Chair said...

@7:41 Thanks bud for the complement, it will come out after I fill in all the pieces.

Anonymous said...

No chinoz in GTO,mex
100 % omeca

Anonymous said...

So what about the twins in Chicago? I missed that story. Could you please fill me in.

Anonymous said...

He is being held by the USA pending extradition to Mexico AKA he has a warrent in Mexico. USA Mexico have an extradition treaty. What part of that disturbs you? You prefer he was running free flooding the USA with meth?

Anonymous said...

The funniest thing happened when I tried to look up the characters for Gon's name. I came up with 淋病. Then when I translated from Chino back to Espanol, it says it means "gonorrea."

Oiga, Sr. Gonorrea. En lugar de andar traficando drogas para los norteamericanos, mejor buscar algo para usted y esa.....condicion suya.

"lito"brito said...

yeah ....no shit... WTF ''no charges but still held ..sometimes it is just TOO obvious that our government is complicit in the world wide drug trade.

.sure sounds like protective custody to me...bet somebody is saying ..give us the money..and we give you him

Anonymous said...

You fail to mention the unbeleivable open sex slavery that also is abundent in Tepito..! I have seen young chinese girls brought to Mexico
under pretence of domestics for upper eschelon Mexicans being sold openly and with police as well as Govt. knowledge, some as young as teenagers. These women are used as "Toys" by both the Cartel heads and the Filthy Rich Mexican Businessmen who use them until they resell them as street sluts in the tourist havens.

Anonymous said...

Hahaha but I thought everyone wanted us to believe chapo was the only major mover and shaker in mexijcles....

MexicoUnido said...

Lmfao...

on another note I have been to quite a bit of places in México, and never have I came across a chino etc. lately these postings on BB have insinuated that Mexico is damn near being over ran by Asians etc. are these true facts or just another Chicano/ chicana over doing it on a simple story?

DD said...

Good story as usual ACI. The enormous amount of dollars involved is beyond my ability to imagine.

Anonymous said...

1::19 pm. Google FLORES TWINS CHICAGO 2012. Another f'd up story about the games going on between THE DEA AND OTHER US GOV'T.S. AGENCY'S ATTEMPT TO GET CHAPO (Which of course would be GREAT but in the process giving free passes to other drug dealers). Without BB, most of us would have zero info. THE FLORES TWIN STORY IS AN ONGOING MESS. Thanks, Texas Grandma. :)

Anonymous said...

He already is ..if you know how to read.

Anonymous said...

Tepito seemed to play it up a bit for the cameras. It's not as brazen as people think. I know firearms are able to be purchased there but trust me, you won't get random offers for stuff like that.

Also, even though I go there and I am a foreigner (and white) I strongly suggest you avoid Tepito. Although they do have some damn good tacos in the warehouse area.

Anonymous said...

Also, (same Gringo who frequents Tepito) I -have- seen a lot of Asians especially around the Zocalo. (Mexico City) They're very respectful and run a lot of the small stores and stands around certain areas outside of Chinatown.

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