The U.S. government filed on Friday to forfeit on a McAllen warehouse they believe was serving as a “staging ground” in an international cigarettes smuggling scheme.
The civil forfeiture details the discovery made Jan. 15 of nearly 17 million contraband cigarettes inside a tractor trailer at a warehouse located at 3901 W. Ursula Ave.
Assisting Homeland Security Investigations, law enforcement agents from the Texas Department of Public Safety and the Mexican Tax Administration Service discovered the shipment was headed to Mexico, where they have been banned for health reasons. Investigators found it wasn’t a “one-off scheme.”
When they returned a month later, they introduced themselves to Jose Francisco Guerra. He owns Victor M. Guerra Customs Brokers and was operating out of the warehouse. During that visit, investigators saw 40 cases of unstamped cigarettes in plain sight.
Guerra reportedly told investigators of the scheme involving the warehouse owners, brothers Arturo and Edgar Ruiz.
According to Guerra, the Ruiz brothers ordered contraband cigarettes from China, Vietnam, Panama and the United Arab Emirates to the Port of Houston. Guerra would then arrange for the delivery to the McAllen warehouse where he would prepare them for their transport to Mexico.
He told investigators he created “fraudulent sales tickets to avoid paying in-bond securities required by law and help avoid detection at the U.S.-Mexico border by Customs and Border Protection,” according to the civil forfeiture complaint.
In return, Guerra was wired money for his part in the scheme. He was also allowed to work out of the warehouse rent-free.
With a seizure warrant in hand, investigators went back to the warehouse a third time on March 3. They seized about 361,670,000 illicit cigarettes, along with records, receipts, manifests and financial statements connected to the criminal operations.
Three men — Luis Enrique Vazquez de la Cruz from Mexico, Juan Carlos Teran from Mexico, and Jose Francisco Guerra, a U.S. citizen — were arrested and charged with February’s discovery.
All three men pleaded guilty to the charges for smuggling.
On Nov. 3, Juan Carlos Arteaga was sentenced to serve a year in prison.
Vazquez de la Cruz and Teran both signed plea agreements admitting to the smuggling count. The U.S. government agreed to dismiss the second count for the unlawful transportation and false statements made in the records used to move the products.
Their sentencing is still pending, but they will receive a lesser punishment as per the plea agreement terms.
The investigation found the Ruiz brothers had trafficked and smuggled cigarettes since 2013. If charges were filed against the brothers, they have yet to be disclosed.
Editor’s note: This story was updated to add information about Homeland Security Investigations’ involvement.