ARE THE CARTELS ENTRENCHED AT THE PORT? PORT BOARD AND OFFICIALS MUM ON THE MATTER

(Crude oil stolen from PEMEX by criminal cartels was trucked  to Arroyo Terminals in Rio Hondo then transferred for sale at bargain prices to undercut competition throughout Texas.)

By Juan Montoya
U.S. Attorney's Office

Various Sources

Have the Mexican criminal cartels carved out a sanctuary at the Port of Brownsville?

As the massive money laundering case against a Utah man and his family works its way through the federal courts, it is becoming apparent that the Tamaulipas Gulf Cartel and the Jalisco New Generation Cartel have been stealing millions of dollars in crude oil m PEMEX, the Mexican oil state company, and shipping it to the Port of Brownville since at least 2022, according to the Treasury Department.

A federal grand jury indicted Maxwell Sterling Jensen, 25, of Utah, who co-owned Arroyo Terminals in Rio Hondo, and his father, James Lael Jensen; his mother Kelly Anne Jensen; and his brother, Zachary Golden Jensen. They’re charged with participating in a conspiracy to launder money linked to fraudulently imported crude oil.

Brownsville Navigation District officials, including the chairman Esteban Guerra, have not commented publicly on the explosive case which occurred during their watch. In its latest issue, the port,  which published a monthly magazine called "Port Matters," makes no mention of the case. But it  routinely praises the board and the port administration.

"Who was minding the store?," asked a court observer present during the government's arguments at a federal court hearing. "All we have gotten has been a rosy picture of the amount of money they claim the port produces and what a great job the board and administration has done. But the port director William Dietrich was the chief of police all that time and he knew nothing? Guerra has also been strangely silent until now. Don't we have a quartermaster? And if the port was not involved, shouldn't they clarify that?"

Guerra was elected to the Port of Brownsville in 2018. He was first appointed chairman of the Brownsville Navigation District Board of Commissioners in May 2022, when the government charges the crude started arriving at the port. He was reappointed to continue serving as chairman in May 2024. Dietrich joined the port as Chief of Police, also in July. 2022, and appointed port director in August 2024.

The April 17 indictment charged that the crude oil was mislabeled as waste oil and apparently was not inspected by port officials or authorities all that time and then delivered to complicit U.S. importers in the oil and natural gas industry operating near the U.S. southwest border, according to the Treasury Department, “who sell it at a steep discount on the U.S. and global energy markets before repatriating the significant illicit profits back to the cartels in Mexico.”

The indictment charged they conspired to buy and smuggle more than 2,800 shipments of stolen oil from Mexico into the U.S. as part of an alleged scheme that began in 2022.

Tanker trucks delivered thousands of gallons of crude oil to Arroyo Terminals, which stored the oil in tanks near Rio Hondo. Every few weeks, barges would transport the oil to buyers in other parts of Texas.

After first denying Maxwell a bond, U.S. Magistrate Judge Ignacio Torteya III set it at $750,000 with a $75,000 cash deposit. He is is scheduled for a pretrial hearing in June. If convicted on the most serious charge against him, Maxwell faces up to 20 years in federal prison. In its indictment, the government said it would seek to forfeit as much as $300 million in currency from accounts in Wells Fargo Bank and Bank of America. 

The government also stated that it plans to seize Arroyo's assets, properties, and the defendants' properties in Utah, although it is not clear if it included their $ $9.2 million mansion outside Salt Lake City.     

The indictment also charged Maxwell and James with aiding and abetting the smuggling of goods and making false statements. “They were entering into agreements with conspirators – unindicted conspirators – to bring mislabeled crude oil from Mexico into the United States,” Assistant U.S. Attorney Michael Hess said during a hearing on April 24 in Utah.

The "co-conspirators" aren't named in the original indictment fled in federal court, but presumably will be included in the evidence to be presented in court. Any guesses which local – or Mexican ? – officials and/or businessmen might be included? 

The indictment issued by the federal grand jury charges that they labeled the crude oil as “waste of lube oils,” according to the indictment, and “petroleum distillates.”

“This is significant mainly because the government of Mexico, through its oil company, PEMEX, will not allow for crude oil to enter into the United States except through very limited agreements with oil and gas companies here in the United States,” Hess said. “So the crude oil that was making its way into the United States was, by necessity, having to be stolen from PEMEX, mislabeled and then delivered into the United States labeled as ‘waste oil.'"

By claiming the crude oil was actually waste oil, they also paid lower taxes and tariffs. “Fuel theft, colloquially referred to in Mexico as huachicol, is the most significant non-drug revenue source for Mexican cartels and other illicit actors,” according to information published by the U.S. Treasury Department.

Coming Soon: Other ties of  Mexican criminal cartels and corrupt public officials and the Port of Brownsville