HomeInvestigationsPart II: The Modus Operandi

Part II: The Modus Operandi


It is not a fancy video production. It begins, “Horse Races…Coban, Guatemala…September 15, 2010.” Two men -- one wearing a jockey’s uniform, the other in street clothes -- ready their horses behind a metal starting gate on a dirt track. Norteña music plays in the background. The camera scans the crowd: spectators wearing cowboy hats, sun glasses and jeans are smiling, taking in the scene from their pickup trucks. The gate pops up, and the horses sprint down the track to the joy of the audience.

The race would be an innocuous manifestation of local sport if it were not for the identities of those in attendance (see video below). It was one of many horse races chronicled that day in the 47-minute home video. But the footage provides a veritable who’s who of the Zetas-Overdick alliance, including top leaders, hitmen, bagmen and even a military attache. There are several Zetas’ commanders and lieutenants; Horst Walther Overdick and Overdick’s son, Walther Jr.; two suspected assassins and members of the groups’ money laundering operations; and finally, a Guatemalan military officer who, surprisingly, is dressed in full uniform as he watches.

Beyond personalities, the video illustrates just how many layers deep the Zetas-Overdick drug trafficking, money laundering and contraband network reaches in Coban and provides a starting point for understanding how it works. The network has evolved over time, but the functions of its players has remained largely the same: the Zetas are focused on security and providing large cash flow for illegal product; the locals provide the illegal drugs, and the infrastructure and contacts to receive, store and move them through Guatemala’s treacherous and duplicitous underworld corridors. Both launder proceeds through the local economy, although it’s mostly the locals who provide the contacts and channels through which this is done.

For their part, the Zetas have about 30 operatives in Guatemala who are divided into two pieces: the operational wing, which is the security apparatus, and the administrative wing, which deals with the money. The operational wing has recruited locals and trained them in Mexico and Guatemala in security detail, reconnaissance, and assassination. Their main recruits are former Guatemala military. Contrary to many reports surfacing that the Zetas seek street gang members for hire, two former government officials told InSight Crime that the Zetas prefer ex-soldiers precisely because they come with some training, skills with weapons, and an understanding of hierarchical management.

Some of these ex-soldiers are former Special Forces known as Kaibiles. The Kaibiles are the Guatemalan military’s version of the U.S. Marines, although much fewer in number. The military has trained just over 1,100, a process that is rumored to include having them raise a puppy, then kill it at the end of basic training, just to prove their ability to put orders above all else.

The Zetas operational wing in Guatemala has grown to include ten lieutenants, most of them Mexicans, who each have between eight and ten soldiers. This gives them about 80 soldiers total. They call these small groups of soldiers “estacas,” a homage to their military mentality. The Zetas, although more than 10 years removed from their beginnings, still borrow heavily from their army background in language, modus operandi, and strategy. They establish territorial dominance via superior numbers, weapons, tactics, intelligence gathering, and usually psychological terror. In this way, they can quickly corral the local criminal market and begin collecting their all-important “piso.”

The Zetas also use contacts they have developed, with the help of their local allies, in the Guatemalan military to obtain weapons and training. Current and ex officers facilitate weapons purchases. A 2009 U.S. diplomatic cable released by WikiLeaks said the government had “sent home” twelve junior level military officers on suspicion of selling weapons to traffickers. When they cannot buy the weapons, the Zetas steal them. One highly publicized investigation into the death of five police who were allegedly ransacking Zetas’ drug and weapons depot, revealed that the weapons the Zetas used to kill the police were stolen from a military weapons cache. Current and ex officers also provide training. A current high-ranking military officer who is not authorized to speak on the record told InSight Crime that the Zetas have camps in various parts of Guatemala and Mexico where they train mostly Guatemalan ex-military personnel.

The potential reach of the Zetas into the military hierarchy is evident in a video obtained by InSight Crime in which a Kaibil officer appears to be cavorting with the Zetas and Overdick groups during a horse race the two held next to the Coban airport (see photo above). A source identified the man as Colonel Edgar Ernesto Muralles Solorzano. Guatemalan military spokesman Colonel Ron Urizar could not confirm that Muralles is the officer at the horse races. But he told InSight Crime that Muralles is a former Kaibil and, at the time, Muralles was stationed at the military school Adolfo V. Hall del Norte, in San Pedro Carcha, just outside of Coban. Muralles, who is still active but not currently assigned to a post, was not available for comment, Urizar said, as Muralles is not authorized to speak to the press about personal matters.

A close relative of Overdick's top security team is also an active military officer, according to Guatemalan and foreign security officials consulted for this report, and is connected to the group's activities. Another former Kaibil, who is alleged to have participated in the massacre of the 27 farm hands in Peten in May, was captured following the massacre.

Once their operational wing take control of the territory, the Zetas monopolize the “piso.” In Coban, this was relatively easy compared to the battles the group faces in Mexico. When they found a local vender selling pirated DVDs that they did not make, they reportedly killed him. A marijuana dealer was also found dead. A man bringing in contraband gasoline from Mexico was beaten and robbed of his recent earnings. Coban is now flush with Mexican products, from eggs to gasoline and to toilet paper to Mexican tortillas that are available on street corners.

All of the money collected goes through the Zetas’ administrative wing. This wing is completely focused on money in and payments out, including the massive bribery scheme necessary for any organized criminal business to thrive. For this, the local Zeta operators and allies approached the police. The Zetas started paying them $300 a month in $20 notes; the police radio dispatcher got $500 per month. Police commanders in the area received substantially more—reportedly a $10,000 advance to start relations and regular monthly envelopes full of $20 dollar bills.

The precision is classic Zetas. The group is known for its scrupulous bookkeeping. In return, the police provide the Zetas with turn-by-turn directions when moving product or to evade authorities when the road had a military presence. The police also give cover during assassinations, and information about who was saying what about them in the legal, political, and civilian population.

The Zetas also established an elaborate network of eyes and ears to gather intelligence. These “halcones,” or hawks, range from beggars to prostitutes, shoeshine boys to taxi drivers, politicians to prosecutors. They number in the hundreds, according to one military official who worked in the area. As it was once with the Gulf Cartel in Mexico, the locals refer to Zetas as “the company.”

In addition to their eyes on the street and in the police, they penetrated the local judicial system. Their lawyer reportedly approached the District Attorney’s office offering bribes, and they were able to buy off some lower level prosecutors through an ex-policeman who works for them and dates a female prosecutor.

The Zetas have consolidated their hold on the area in other ways as well. Their administrative wing bought or forced locals from their farms for safe houses. In order to avoid suspicion, they reportedly leave the titles in the names of the original owners (they do the same when they “borrow” cars from locals). These are critical points of storage and transit that the group uses to receive and move illicit product.

Most of the drugs appear to come via Honduras these days, where political turmoil and corruption has made that country the easiest place to land an airplane or dock a go-fast boat. Honduras is also attractive because with relatively little fuel, a small aircraft can move tons of illicit product. Guatemala’s hidden airfields require more fuel and thus give less room for product.

For the Zetas, this has not been as important as it has been for other organizations. As opposed to other criminal networks that move in bulk, the Zetas move smaller loads, possibly because they lack the infrastructure and reach their rivals have. Their preferred method is via hidden compartments, cargo trucks and containers. The larger loads they do have get escorted by the operational wing. One car in front gives notice of any unplanned security checkpoints; one car behind is prepared for any unplanned confrontations. As in the heyday of Juancho Leon, Guatmala is still famous for its “tumbes,” or thefts. Some entrepreneurial police operate their own “tumbe” gangs, often reselling to the exact criminal group they just robbed, so the Zetas make sure they know who is manning the police posts when they move large cargoes.

The group has also started laundering money through local businesses. In part, this has been brokered by Overdick and his contacts. He is related by marriage to a congressman who has some oversight of the public works contracts in the state. These contracts are channeled through various congressional committees, government agencies, and then through what are referred to as non-governmental organizations (NGOs) in Guatemala. These government agencies and NGOs serve as brokers and often hand out contracts to companies based on the kickbacks they will receive. The projects serve two purposes for the criminals: They can launder drug proceeds; and money channeled through construction gets kicked back to the company owners, NGOs, politicians and the underworld figures involved.

Alta Verapaz is not immune to this scheme. The daughter of one of Overdick’s drug trafficking partners was the head of one of these NGOs, the Verapaz Rural Development Program (Programa de Desarrollo Rural de las Verapaces - PRODEVER). For its part, PRODEVER got its money from the National Fund for Peace (Fondo Nacional para la Paz – FONAPAZ) – a government agency that has focused on administrating projects since the peace settlement in 1996. In 2010, the government investigated several contracts FONAPAZ administered, some to Alta Verapaz, claiming that as much $58 million was misappropriated by NGOs.

These schemes may have reached to the top of the food chain. The man monitoring the FONAPAZ projects at that time was Obdulio Solorzano, a former congressman for the National Unity for Hope (Unidad Nacional de la Esperanza - UNE), the coalition party of Alvaro Colom, Guatemala’s president. Solorzano was assassinated in 2010 in Guatemala City, possibly due to his knowledge of these and other schemes, including the financing of Colom’s presidential campaign in 2007. In December, the Zetas issued a communiqué via the local Coban station La Buena in which they alleged that Colom took $11.5 million in campaign contributions from them, and then the president “betrayed” them. In the communiqué, the group mentions the arrest of an associate and the assassination of alias “Bigote” (“mustache”), an apparent reference to Solorzano. (Listen to the message here.)

In the construction and agricultural sector, both the Zetas and Overdick launder proceeds via the region’s traditional products and services. On the construction side, Overdick operates with a local company that is allegedly fronted by a prominent Coban family. Public works money that his congressional relative may help broker is channeled through that company. On the agribusiness side, both Overdick and the Zetas have numerous cardamom buyers who continue to use that and other markets to launder proceeds. Cross them on the accounting and the consequences are clear: In February, the day the state of siege ended in Alta Verapaz, assassins in Coban killed Boris Pinot, an alleged bagman and cardamom buyer for Overdick. American dollars have flowed into Coban, as well as remote areas of Alta Verapaz, to the point where indigenous producers stopped accepting the “green” money, complaining that this forced them to make an extra trip to Coban to exchange it. Price distortions have followed. Some local buyers have said privately they cannot compete with those who make deals with the traffickers. Most have kept quiet.

The local high school kids did not complain about the dollars. The Zetas paid them small fees to change the money in the local banks until the banks started asking too many questions. The money-changers were also happy. They regularly swapped dollars from the police, “hawks” and other Zeta operatives at six quetzals a dollar, instead of the going rate, which is above seven.

The Zetas also brought with them new tactics and a new attitude. They drove around in large, ostentatious cars, such as Hummers, often letting their automatic weapons hang from open windows. When two policemen challenged a Zeta commander in the central plaza, he held a gun to one of their heads while he stripped the other policeman of his gun, then pointed it at the officer’s temple. When another policeman refused to take payments, they stopped his patrol car, took him from the vehicle and put him in theirs. Then they drove around the city beating him, before leaving him on the side of the road.

Locals challenged the newcomers at their own risk. Two college students who stared too long at one of the Zeta’s girlfriends during a horse show were gunned down later at a gas station. Another Mexican Zeta killed his Guatemalan girlfriend, then left her at the base of a bridge, allegedly because he did not want her to cheat on him after he’d returned to Mexico the next day. Like many other crimes, these were not reported in the news, a former high-ranking Alta Verapaz official told InSight Crime on condition his name not be published.

The increase in drug trafficking through the region has also led to a spike in consumption as the Zetas and local operators increasingly pay their operatives in drugs rather than cash. The large groups that move bulk shipments cut their costs significantly this way. The locals like it as well. These operatives, including both soldiers and “hawks,” sell a diluted version of the powder in small bags for 50 or 100 quetzals. Some more industrious sellers cook the powder into a hardened form of local crack that goes for between 25 and 100 quetzals, depending on the size of the rock. There are no hard numbers for how much consumption has increased, just anecdotal evidence and the increasing violence surrounding the local trade.

These operators, a combination of the soldiers and the “hawks,” are also involved in other criminal activities, especially extortion. There are both occasional and regular extortion schemes in the area. The regular requires local shop owners, venders and other businesses to pay monthly quotas. The occasional could come via a telephone call or a visit and can be hefty, between $3,000 and $6,000, according to the relative of one victim. The victims come from all social classes, and the elites’ reaction to this activity may determine if the Zetas are a long term resident or just a short-term nightmare.

More stories in this series:

Part I: The Incursion

Part III: A Guatemalan Response?

Watch video.

Analyze map.

Download entire report (pdf).

Descarga informe completo en español (pdf).

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