By Ray Stern
By Ray Stern
By New Times
By Amy Silverman
By Stephen Lemons
By Stephen Lemons
By Monica Alonzo
By Chris Parker
The U.S. Customs Service has compiled intelligence that Alejandro Canelos Rodriguez, a Sinaloa produce farmer, shipper and distributor, may be involved in drug trafficking and money laundering, according to federal sources and documents.
"He's a suspected doper," says one federal source familiar with Customs Service intelligence reports on Canelos.
U.S. Drug Enforcement Administration documents indicate that agency also has compiled information for law-enforcement purposes on Canelos. DEA declined to release the information, citing privacy concerns.
Canelos' son, Alejandro Nicolas Canelos, told New Times in a March 17 letter that Phoenix DEA special agent Gus Fassler would say "that any and all allegations were false."
Fassler did, in fact, tell New Times that Alejandro Canelos "is not a suspect of DEA."
However, a congressional staffer tells New Times he called the U.S. Consulate in Hermosillo on March 18 and was told that "DEA is against issuing the visa" to Canelos. The staffer asked not to be identified.
Despite conflicting accounts of DEA's role, there is no doubt that the Customs Service has monitored Alejandro Canelos' activities for several years and has placed his name in a narcotics intelligence database that has prevented him from obtaining a standard 10-year visa to enter the United States. Canelos' attorney says Canelos was issued two short-term visas in 1996 after he was denied a permanent visa in 1995.
The State Department denied Canelos' most recent application for a visa in December, Mary A. Ryan, assistant secretary of state for consular affairs, reported in a March 3 letter to New Times.
Jeri Pudschun, a State Department spokeswoman, did not specify why Canelos was denied a visa but cited a broad provision in law which says a visa can be denied if the applicant is ineligible or fails to provide sufficient information.
Other State Department officials say that the mere allegation that a person is involved in drug trafficking is sufficient to deny a visa.
Alejandro Canelos denies any involvement in drug trafficking and threatened to sue New Times if it publishes "allegations or insinuations which attempt to connect me or any of my businesses to drug-related activities."
Canelos is represented by John Dowd, a high-powered criminal-defense attorney from Washington, D.C., who will defend Governor Symington in his May 13 federal trial on 23 counts of bank fraud, perjury and extortion.
Records obtained by New Times reveal that the governor and his family are linked to Canelos in significant ways, including:
* The governor's wife, Ann Symington, has invested between $25,000 and $100,000 in a Mexican corporation, Melones Internacional SA de CV, a corporation headed by Alejandro Canelos.
* A "J. Fife Symington" is a director of Melones Internacional. The governor's bankruptcy lawyer, Robert Shull, has said the corporate official is the governor's son, J. Fife Symington IV.
* The governor's two eldest sons--J. Fife Symington IV and Scott H. Symington--are business partners with Canelos' son, Alejandro Nicolas Canelos, in at least one Arizona corporation.
* Governor Symington has used his political influence in the United States and Mexico in an attempt to benefit the business interests of Canelos and his family. Symington also has pushed for speedier processing of truck traffic entering the United States from Mexico.
At the same time, critics contend that the state Department of Public Safety, which monitors traffic on Arizona's highways, has seen its ability to combat drug traffic curtailed by Symington's hand-picked DPS administrators.
The governor, his wife and sons refused to return phone calls and letters seeking comment.
Canelos' attorney, John Dowd, at first said there was "no basis in fact to any of the speculation or allegations" involving Alejandro Canelos. Dowd said on March 17 that Phoenix DEA special agent Fassler had cleared up all allegations involving Canelos about a year ago.
"I'm telling you that the special-agent-in-charge of the Phoenix office investigated that information and determined that to be false," Dowd says.
Fassler, however, tells New Times that he investigated only one allegation concerning Canelos--at the request of the State Department--and determined it to be unfounded. He adds that he is not aware of the intelligence that other agencies, including Customs, has compiled.
Of course, as Dowd suggests, law-enforcement computers often store raw, unverified--and often unverifiable--intelligence. But the suggestion that Fassler examined the entire database, investigated the collection of allegations and absolved Canelos is distortion.
"I don't know about any other investigations," Fassler says.
When New Times relayed Fassler's statements back to Dowd, the lawyer acknowledged that Customs intelligence information on Canelos remains in the State Department's files.
"I know of no new allegation or new information," Dowd says. "It's the same old crap in the computer."
Dowd says there is no evidence linking Canelos to drug trafficking and says his client is getting "his business destroyed because the State Department can't get its act together."
Dowd's role as Canelos' attorney--in addition to several partnerships between the governor's sons and Canelos' son--raises the possibility that Governor Symington has known for some time that Alejandro Canelos has been under scrutiny as a possible drug trafficker.
The congressional staffer says he was told by the visa officer at the U.S. Consulate in Hermosillo that Symington's office had made calls to the consulate concerning Canelos. Officials at the consulate declined to comment.
The staffer also says he was told Canelos reapplied for a 10-year visa on March 11.
Alejandro Canelos is the son of a Greek immigrant who illegally entered the United States and was deported to Mexico, where he built a produce fortune from scratch. The Canelos family operates a vast farming empire with properties in the Mexican states of Sinaloa, Sonora and Baja California.
The Caneloses' main company, Grupo Agricola Canelos, is based in the violent and drug-plagued city of Culiacan, located on Mexico's fertile western plains between the Sierra Madre and the Sea of Cortez. The city is the capital of Sinaloa and is a major warehousing and distribution center for narcotics smuggled into the United States.
Custom Service officials declined to discuss Canelos' operations--his trucking company, which hauls produce more than 1,000 miles to the U.S. border, and G.A.C. Produce, his distribution warehouse located in Nogales, Arizona.
The size of Canelos' trucking fleet, said to number more than 300, and the lengthy transit trucks must make from Sinaloa to the U.S. border make it possible that people may be loading drugs onto his trucks without his knowledge.
Federal sources indicate that the Custom Service has inspected Canelos' warehouses in Nogales and San Diego and temporarily impounded a jet aircraft belonging to the Canelos family after a hidden compartment was discovered in the craft. The dates of the inspections and aircraft impoundment were not known, and no illegal items were discovered, one of the sources says.
Rudy Cole, the U.S. Customs Service's Nogales port director, says Mexican truckers who are involved in narcotics shipping typically haul drugs to towns just south of the international border.
Once the narcotics reach Mexican-border towns, the drugs generally are removed from trucks and smuggled across the border via other means, including foot traffic, automobiles, horseback and commercial trucks, Cole says. After crossing the border, U.S. commercial trucks are occasionally used to transport the drugs to their U.S. destination.
Revelations that members of the Symington family are in business with a suspected narcotics trafficker come at a time when Governor Symington is lobbying Congress on drug issues. Symington has fought congressional efforts to penalize Mexico for that country's notorious government corruption in the war on drugs.
Last week, Symington traveled to Washington, D.C., and met with House Speaker Newt Gingrich and other key House members.
"I was giving my regional point of view as a governor who works with Mexico very closely in the Southwest. I said, 'What good would come from it [decertification]?' Mexico cooperates with us on a whole range of issues, including the drug war," Symington was quoted as saying.
The House, however, voted to give Mexico 90 days to begin fully cooperating with the United States on the drug war--or face decertification. The Senate is considering the bill this week.
Canelos is the second prominent Mexican with ties to Symington who has faced allegations of drug trafficking.
U.S. intelligence reports reportedly say that Sonoran Governor Manlio Fabio Beltrones attended meetings where drug lords paid off politicians who were protecting their operations.
Beltrones is a close friend and political ally of Symington's; the Arizona governor vigorously defended Beltrones after a story describing Beltrones' alleged narcotics ties appeared in the New York Times.
"It's not going to change our relationship," Symington told reporters.
Beltrones has denied being involved with Mexican drug figures and is suing the New York Times in Mexican courts.
If allegations against Beltrones and Canelos are true, Symington's association with the men would contradict his professed views on the importance of fighting the drug war.
"There are those today across the country, including some conservative Republican voices, who are saying that we're never going to win the drug war, and a lot of people are frustrated by where we are and the resources that have been expended," Symington said in December.
"I happen to disagree with them about that. I think we need to make a moral stand. It's an important battle to fight for our children, and I would fight it even if somebody told me we were going to lose it because I think the outcome is entirely unsatisfactory."
Yet such rhetoric comes at a time when the Arizona Department of Public Safety--whose director is appointed by Symington--is significantly scaling back its drug-enforcement efforts.
Critics contend that the governor has politicized the state police agency with his controversial appointments of administrators with strong personal ties to Symington. Undercover DPS narcotics agents tell New Times there has been little funding for months to purchase drugs and pay informants.
DPS Lieutenant Colonel Charles Warner has confirmed that funds are scarce and that narcotics officers are using other methods to do their work.
DPS also is eliminating its asset-forfeiture unit, which generated millions of dollars for narcotics enforcement, including undercover officers' drug purchases. Asset-seizure responsibilities will be transferred to the Maricopa County Attorney's Office.
Finally, DPS Director Joe Albo last month severed a 15-year joint operation with the Drug Enforcement Administration when he withdrew DPS officers from DEA-led task forces in Phoenix and Tucson. DPS officials say they could better utilize their manpower in other ways.
DPS is torn by dissension in the wake of Warner's promotion to assistant director in December--a promotion that was requested by Governor Symington ("DPS: Department of Political Safety," February 6).
Warner's rapid rise to power from a lieutenant in charge of Symington's personal security detail in 1995 to the commanding officer of the Highway Patrol and Criminal Investigations Bureau (which includes narcotics officers) has angered many veteran DPS officers who say Warner is unqualified to lead the agency and got the job because of his personal friendship with the governor.
The Symingtons' extensive financial ties to the Canelos family were first revealed in May during a sworn deposition given by Ann Symington in connection with the governor's bankruptcy case. The governor's wife testified that she had invested $25,000 in Melones Internacional in November 1995, two months after her husband filed for bankruptcy, claiming $26 million in debts and $65,000 in assets.
Ann Symington stated in the deposition that she invested in the company because her stepson, J. Fife Symington IV, was a partner.
The governor's wife increased her investment in Melones Internacional to as much as $100,000 in 1996, according to the governor's financial disclosure statement filed in January with the secretary of state.
Mexican incorporation documents filed in Culiacan and obtained by New Times state that Alejandro Canelos Rodriguez is the president of Melones Internacional and his son, Alejandro Nicolas Canelos, is the secretary. The incorporation records state that a "J. Fife Symington" is a director. None of the directors was required to sign the incorporation papers.
The vagueness of the filing raised the possibility that the governor is a director in Melones Internacional.
When New Times disclosed that it was unclear which J. Fife Symington was a partner in Melones Internacional ("Fife's Mexican Connection," December 26, 1996), the governor's bankruptcy attorney, Robert Shull, stated that the Melones director is not the governor, but his son, J. Fife Symington IV. However, Shull has provided no proof such as additional corporate filings that bear signatures.
Using the name J. Fife Symington without generational designation is unusual for the Symingtons. In Arizona, the two men have been careful to separate their business interests. Arizona Corporation Commission records show the governor affixes "III" and his son "IV" to their names on corporate filings.
According to the Mexican incorporation papers, director Symington and the elder Canelos have more powers than the younger Canelos. Symington and the senior Canelos are authorized to obtain credit from Mexican and foreign institutions and to open and operate checking accounts, powers not granted to the junior Canelos.
Mexican government records also reveal Melones Internacional is chartered as more than just a melon-growing concern. The company's charter also allows it to conduct commercial and residential real estate activities, businesses in which Governor Symington has extensive experience.
And the incorporation documents state that since the majority of its stock is controlled by Mexican citizens, the company gives its directors, including "J. Fife Symington," access to real estate along coastal areas and international borders that foreigners are otherwise forbidden to own.
The links between the Caneloses and Symingtons may have been forged by the two sons.
J. Fife Symington IV and Alejandro Nicolas Canelos attended Harvard University together beginning in 1988. They lived in the same collegiate hall at Harvard--Eliot House--and both graduated in May 1992.
The pair has formed at least two Arizona corporations, state records show. The men, in their late 20s, are the sole directors in Symington & Canelos Industries Incorporated. The company's March 1994 incorporation papers state that it specializes in the manufacture, purchase, sale and distribution of lumber products.
In December 1995, J. Fife Symington IV, Nicolas Canelos and another son from the governor's first marriage, Scott H. Symington, formed Fruit Stand Incorporated. The company sells fruits and nuts in shopping malls.
Governor Symington has used his official position in an attempt to further the business interests of Alejandro Canelos and members of his family. The governor has lobbied Congress and the state Legislature on trade issues and has communicated with Mexican President Ernesto Zedillo.
Last spring, the Fresh Produce Association of the Americas (PFAA), a Nogales, Arizona, trade organization representing Mexican growers, sought Symington's help in a trade dispute that erupted between Mexican and U.S. tomato growers. One of Alejandro Canelos' companies, G.A.C. Produce, is a member of PFAA.
Symington lobbied Congress and fellow governors to support Mexican growers. (Symington publicly disclosed his wife had an investment in Melones Internacional in his 1995 and 1996 state financial disclosure statements but failed to identify the enterprise as a Mexican corporation. Instead, Symington gave a Phoenix address for the company, 345 East Windsor, apparently a residence.)
Symington's lobbying efforts on behalf of PFAA were successful, culminating with a communique, signed by 10 U.S. governors, that was critical to the association's effort to thwart U.S. trade sanctions.
PFAA expressed its gratitude to Symington in a July 2, 1996, letter that stated, "the entire membership of the Association is eternally grateful for the effort of you and your staff."
Public records also indicate that Governor Symington has promoted Canelos' businesses to Mexican President Zedillo.
On March 3, 1996, President Zedillo sent Symington a letter thanking him for his continued support of the North American Free Trade Agreement. Before inviting Symington to a luncheon in Mexico City, Zedillo updated the governor on a Canelos business enterprise.
"I have asked our Secretary of Agriculture, Mr. Francisco Labastida, to have a meeting with Mr. Canelos regarding the ethanol project," Zedillo states in his letter to Symington.
Public documents released by the Governor's Office do not describe any ethanol projects or reveal who, besides Canelos, is involved.
The governor also has touted state and federal initiatives to speed commercial traffic over the border at Nogales--an effort that would help not only Canelos, but all commercial shippers.
Symington asked the state Legislature to appropriate $750,000 to supplement a federal review of port operations in Nogales. The state funds were appropriated and earmarked to develop ways to speed commercial traffic.
Symington has discussed the Nogales port issue several times with Mexican President Zedillo and has received assurances from Zedillo that Mexico will cooperate with speeding commercial traffic through the border.
He's also broached the issue with President Clinton, writing him in December that Clinton's delay in permitting cross-border trucking "robs the entire U.S.-Mexico border region of the full economic benefits that the North American Free Trade Agreement promises."
Alejandro Canelos could not obtain a regular visa in October 1995 to enter the United States. But that didn't stop Governor Symington and Canelos from holding a private meeting.
The governor used his elected position and his access to a taxpayer-supported aircraft to arrange a private meeting with Canelos in October 1995 in Culiacan.
Symington used the DPS' turbojet plane to transport himself, J. Fife IV and Nicolas Canelos along with two state officials from Phoenix to Culiacan at taxpayer expense.
The entourage was part of a state trade mission to Sinaloa. Other Arizona businessmen on the trip paid $350 to $400 for commercial flights, but the governor's son and the younger Canelos were transported free.
State records indicate that the governor broke off from the rest of the state trade delegation on the morning of October 10, 1995.
While the Arizona trade delegation he was leading met with Sinaloan businessmen over coffee, the governor held a two-and-a-half-hour private breakfast meeting with Canelos at the agriculturist's farm headquarters, state records indicate.
The records do not say what was discussed.
But the meeting came less than two months after "J. Fife Symington" joined Alejandro Canelos Rodriguez on the board of directors of Melones Internacional.