The Cali Cartel was a drug cartel based in southern Colombia, around the city of Cali and the Valle del Cauca Department. The Cali Cartel was founded by the Rodríguez Orejuela brothers, Gilberto and Miguel, as well as associate José Santacruz Londoño. Later Cali cartel principals included Hélmer Herrera, Jairo Ivan Urdinola Grajales, Julio Fabio Urdinola Grajales, Henry Loaiza Ceballos, Victor Patiño Fomeque, Phanor Arizabaleta Arzayus, Raul Grajales Lemos, Luis Grajales Posso, Bernardo Saenz and Juan Carlos Ortiz Escobar.
At the foundation of the Cali Cartel was the Orejuela brothers and Londoño, all coming from what is described as a higher social background than most other traffickers of the time. The recognition of this social background was displayed in the groups nickname as "Cali's Gentlemen."
The group originally assembled as a ring of kidnappers known as Las Chemas, which was led by Luis Fernando Tamayo Garcia. Las Chemas were implicated in numerous kidnappings including that of two Swiss citizens, a diplomat Herman Buff and a student, Werner Jose Straessle. They reportedly received $700,000 dollars in ransom, which is believed to have gone on to fund their drug trafficking empire.
The assembled group first involved itself in trafficking marijuana. Due to the products low profit rate, and larger amount required to traffic to cover resources, the fledgling group decided to shift their focus to the more lucrative drug, cocaine.
In the early 1970s the cartel sent Helmer "Pacho" Herrera to New York City to establish a distribution center. This action came during a time when the United States Drug Enforcement Administration (DEA) was not fully pursuing cocaine, and viewed the drug as less critical than heroin, at one point releasing a report stating of cocaine it "is not physically addictive ... and does not usually result in serious consequences, such as crime, hospital emergency room admissions or both."
The lax attitude of the DEA on cocaine is believed to be what allowed the group to prosper, but also to develop and organize itself into multiple "cells" that appeared to operate independently, yet reported to a "celeno" or manager, who then reported back to Cali. The independent cell structure is what set the Cali Cartel apart from the more dominant Medellín Cartel. The Cali Cartel operated as a tight group of independent criminal organizations, as opposed to the Medellíns' structure of a central leader, Pablo Escobar.
It was believed each cell would report to a larger group, who would then report to the leaders of the cartel. The groups as cited by former Cali accountant Guillermo Pallomari are:
The Cali Cartel would eventually go on to be known by then DEA chief Thomas Constantine as "The biggest, most powerful crime syndicate we've ever known."
According to reports and testimony of Thomas Constantine to the United States Congress, "Cali would be the dominant group in trafficking South American heroin due to their access to the opium growing areas of Colombia." Debate over the cartels participation in heroin trafficking remains. It is believed the cartels leaders were not involved in heroin trading, however close associates to them were, such as Ivan Urdinola-Grajales. Their relationships it is believed lead to cooperation with heroin distribution centers.
At the height of the Cali Cartel's reign, they were cited as having control over 70% of the worlds cocaine market and, for being directly responsible for the growth of the cocaine market in Europe, controlling 90% of the market. By the mid 1990's the trafficking empire of the Cali Cartel was a multi-billion dollar enterprise.
In order to launder the incoming money of the trafficking operations, the Cali cartel heavily invested its funds into legitimate business ventures as well as front companies to mask the money through. In 1996 it was believed the Cartel was making 7 billion in annual revenue.
With the influx of cash comes the need to launder the funds. One of the first instances of the Cali Cartel laundering operations came when Gilberto Rodriguez Orejuela was able to secure the position of Chairman of the Board, of Banco de Trabajadores. The bank was believed to be used to launder funds for the Cali cartel, as well as Pablo Escobars' Medellín Cartel. Cartel members were permitted, through their affiliation with Gilberto, to overdraft accounts and take out loans without repayment.
Capitalizing off of this basis, Gilberto was able to found the First InterAmericas Bank operating out of Panama. In an interview with Time magazine, Gilberto admitted to money being laundered through the bank, however attributed the process to only legal actions. The laundering, which Gilberto states was "in accordance with Panamanian law", is what led to the US authorities pursuing him. Gilberto later started a the Grupo Radial Colombiano, a network of over 30 radio stations and a pharmaceutical chain named Drogas la Rebaja, which at its height amassed over 400 stores in 28 cities, employing 4200 employees. The pharmaceutical chains value was estimated at $216 million.
In contrast to the Medellín Cartel who went to war with the government of Colombia, engaging in narco-terrorism, the Cali cartel attempted instead to gain influence within the government through bribes and favors. Gilberto was once quoted as saying "we don't kill judges, we buy them." It is believed Miguel Orejuela at one point had over 2,800 people on his payroll, from government officials to taxi drivers. The Orejuela's social background is cited as being a contributing factor to their relations with the oligarchy of Colombia. One of the most public revelations of attempted bribery came when it was revealed the presidential campaign of Ernesto Samper had received 6 million from the Cali cartel. As fallout from the revelation, Sampers' 1995 campaign manager, Santiago Medin was forced to retire, as well as three other government ministers for their involvement with the Cali cartel, or accepting money from them.
Due to the depths of the Cali cartels bribery and governmental influence, Prosecutor General Alfonso Valdivieso stated "The corruption of the Cali cartel is worse than the terrorism of the Medellín cartel ..."
In the early 1980s and 1990s, the left-wing paramilitaries had struck at the drug cartels. In 1981, the then-paramilitary group, Movimiento 19 de Abril (English: 19th of April Movement) (M-19), kidnapped Marta Nieves Ochoa, the sister of the Medellín Cartels Ochoa brothers, Jorge, Fabio and Juan David. M-19 demanded a ransom of $15 million for the safe release of Marta Nieves, but were rejected. In response to the kidnapping, the Medellín and Cali cartels, as well as associated traffickers, formed the group Muerte a Secuestradores (English: Death to Kidnappers) (MAS). Traffickers contributed funds, rewards, equipment and manpower for MAS operations. Leaflets soon after were dropped in a soccer field in Cali announcing the formation of the group. MAS began to capture and torture M-19 members in retaliation. Within 3 days Marta Nieves was released. The group MAS however would continue to operate, with hundreds of killings attributed to them.
In 1992, the guerrilla faction Fuerzas Armadas Revolucionarias de Colombia (English: Revolutionary Armed Forces of Colombia) (FARC) kidnapped Christina Santa Cruz, the daughter of Cali Cartel leader José Santacruz Londoño. FARC demanded in exchange for the safe return of Christina a ransom of $10 million. In response the Cali Cartel kidnapped 20 or more members of the Colombian Communist Party, Patriotic Union, the United Workers Union and the sister of Pablo Catatumbo, a representative of the Simón Bolívar Guerrilla Coordinating Board. Eventually, after talks, Christina and the sister of Catatumbo were released. It is unknown what happened to the other hostages taken by the cartel.
During the narco-terror war waged by Pablo Escobar on the Colombian government, it is believed a hired assassin attempted to kill Herrera while he was attending a sports event. The gunman opened fire using a machine gun on the crowd where Herrera was sitting, killing 19. However, he did not hit Herrera. In response to the attempted assassination, the Cali Cartel responded by kidnapping and killing Gustavo Gaviria, cousin to Pablo Escobar. Herrera is believed to be a founding member of Los Pepes, a group who operated alongside authorities with the intention of killing or capturing Pablo Escobar.
Included in the list of government officials and officers on the Cali Cartel payroll were a reported 5,000 taxi drivers. The taxi drivers would allow the cartel to know who was arriving in the city and when, as well as where they were staying. By having numerous taxi drivers on the payroll, the cartel was able to monitor the movements of officials and dignitaries. It is reported by Time Magazine, in 1991, DEA and U.S. Customs Service (now ICE) agents were monitoring a shipment being offloaded in Miami, only to find out later that the DEA agents were the target of Cali surveillance at the same time.
While the Cali Cartel operated with a degree of immunity early on, due to its ties to the government, and the Medellín Cartel's narco-terrorism war on the Colombian government, they were still subjected to drug seizures. In 1991 alone, law enforcement agencies seized 67 tons of cocaine, 75% originating from the Cali Cartel. In total, U.S. Immigration and Customs Enforcement (ICE) alone has spent 91,855 case hours and 13 years in investigations against the Cali Cartel, seizing 50 tons of cocaine and $15 million in assets.
The involvement of ICE in the Cali Cartels trafficking came in 1991 when a shipment was intercepted with the aide of a drug sniffing dog. The cocaine was hidden inside concrete posts. The interception of the concrete posts at the Miami seaport lead to seizure of 12,000 kilograms of cocaine and several arrests, as well as the beginning of what the ICE would dub "Operation Cornerstone". A year later in another seizure, an ICE wiretap on Harold Ackerman, whose affiliation was derived from the '91 seizure, enabled the arrest of 7 individuals and 6,000 kilograms of cocaine hidden in a load of broccoli. Accounting ledgers were seized in related arrests which allowed the identification of another shipment being sent to Panama hidden in tiles, this information was passed to Panamanian authorities and lead to the seizure of 5,100 kilograms.
The following year in 1993, ICE struck again at the Cali cartel, this time seizing 5,600 kilograms while pursuing Raul Marti, the only member of the defunct Miami cell to remain. It is believed these successive raids forced the cartel to funnel its shipments through Mexico, however that did not stop the ICE. Three maritime ships were intercepted in '93 with a total of 17,000 kilograms. Operation Cornerstone lasted 14 years targeting the Cali cartels drug trafficking operations.
Between June and July 1995, six of the seven heads of the cartel were arrested. Gilberto was arrested in his home, and Henry Loaiza, Victor Patino and Phanor Arizabaleta surrendered to authorities. Jose Santa Cruz Londoño was captured in a restaurant, and a month later Miguel Rodriguez was apprehended during a raid. It's widely believed that the cartel continued to operate and run trafficking operations from within prison.
The Rodríguez brothers were extradited in 2006 to the United States and pleaded guilty in Miami, Florida to charges of conspiracy to import cocaine into the United States. Upon their confession they agreed to forfeit $2.1 billion in assets. The agreement, however, did not require them to cooperate in other investigations. They were solely responsible for identification of assets stemming from their cocaine trafficking. Colombian officials raided and seized the pharmacy chain Drogas la Rebajas, replacing 50 of its 4,200 workers on grounds they were "serving the interests of the Cali Cartel."