How the Argentinian pilot who collects planes and whom the United States accuses of narco millionaires scammed
Federico “Fred” Machado the Argentinian businessman who will be extradited to UNITED STATES accused of laundering drug money, he is also suspected of defrauding investors and lenders of millions of dollars to acquire jets in which the organization carried cocaine, even for the sinaloa cartel.
In the request to the Argentine justice, to which he accepted TN, texas attorney Ernest Gonzalez explained the maneuver by which he would have generated profits of $ 350,000,000 since 2016.
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To like Leonard Cositortocreator of Generation Zoebut on a much larger scale, “Fred” and his accomplices -Debra Lynn Mercer-Erwin, Kayleigh Moffett and Michael Assad Marcos- are accused of having used the ponzi scheme: the pyramid scheme by which investors are incentivized to take out loans that have been paid for with the funds of previous investors.
To understand the fraud and how the gang managed to have a large fleet, it is necessary to explain how the illicit association in which the Argentine is involved worked. Born in Río Negro, Machado is considered a “big fish” of drug money laundering by the Airport Security Police (PSA) and was captured in Neuquén.
The prosecution pointed out that the transnational criminal organization acquired and operated, at least as of 2010, “aircraft from the United States and other countries to facilitate the smuggling of drugs and drug products, as well as to launder money”, through a complex network. network of companies whose base of operations was the company Aircraft Warranty Company, established in a town in Texas without an airport.
First, the plan included the fraudulent use of registrations and titles to conceal the true nature, location, ownership and control of the aircraft. To do this, the Argentinian and his criminal accomplices used trusts and illicit business entities in this country to acquire and register aircraft, conceal illegal foreign ownership and the true nature of their flights.
However, when the pilots were unable to complete the narco mission, members of the structure deregistered the aircraft and/or transferred title to other parties “to aid in the continued concealment of the control, ownership and location of the same”.
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At the same time, they used business entities and financial accounts to defraud lenders and investors into paying large sums of money for buy planes that don’t exist, that are legally unserviceable or unsaleable.
The pyramid scheme of “Fred” Machado for the purchase of planes of drugs
According to the indictment, since at least 2016, Mercer-Erwin, Moffett and Machado”they devised a plan and an artifice, specifically a “Ponzi” scheme, defraud people and obtain money by false or fraudulent pretenses, representations or promises”.
This scheme took advantage of the typical aircraft purchase transaction to entice investors to deposit millionaire figures in a custody account of the criminal organization.
But this sum, accepted as a loan, was never spent on the purchase of a jet, but was instead used for a refundable deposit. The sales never took place because the plane does not exist or because it belongs to someone else.
For example, on September 27, 2019, via South Aviation Inc., one of Machado’s companies in Florida, in Miami, the group’s members have signed a series of agreements to purchase an unsaleable aircraft.
“It was unsaleable because it belonged to a private airline and was in China“, wrote the prosecutor in the document sent to Procunar, by Diego Iglesas, and studied by the assistant prosecutor Matías Álvarez.
On November 12, 2020, another of the Río Negro companies did the same with an Air India plane and it was not for sale. This agreement was for a refundable deposit of $5,000,000 in dollars. Machado signed this agreement on behalf of Pampa Aircraft Financing, another one of his businesses based in the town where he lived until he had to flee.
The profits obtained were channeled to foreign accounts and investment vehicles through electronic transfers and other means to continue to support and facilitate the operations of the structure.
How Fred Machado’s gang’s fleet of narco jets were discovered
The U.S. Department of Commerce, Bureau of Industry and Security, Office of Export Controls, and Homeland Security Investigations Division have launched an investigation. after noting irregularities in the files of aircraft and that several, on behalf of the accused, were seized or destroyed during international drug smuggling.
The members of the organization tried -by means of another maneuver- get the coveted “N” in front of the queue number indicating that it was registered in the United States.
This letter on the license plate gave them some leeway to operate: the foreign countries they were traveling through were less likely to inspect drug-laden planes or force them to land.
On October 11, 2018, the N241CW jet was purchased by TWA International, from Carlos Rocha Villaurrutiaanother of the persons concerned. On the same day, he registered the aircraft and submitted an International Operations Declaration to fly from Phoenix, Arizona to Ciudad Juárez, Mexico. the jet crashed in Venezuela while transporting 1,200 kilograms of cocaine for the Sinaloa Cartel.
On October 19, 2019, the aircraft N322BC he landed on a clandestine airstrip in Belize’s Cayo District, where he was found abandoned. The seats had been removed and the aircraft was configured to carry narcotics.
On December 16, 2019, the jet bearing the number N939RR was seized in Guatemala with approximately 2,572 kilograms of cocaine. These two aircraft had also been registered with TWA International and deregistered following the incidents. The prosecution managed to detect more than twenty similar cases.
Among them, the jand Bombardier Challenger 604 registered N600AM. In January 2011, Spanish police discovered 944 kilograms of powdered cocaine hidden inside the plane that had arrived in Barcelona from Argentina. The flight was operated by Machado’s South Aviation.
It was the plane of brothers Gustavo and Eduardo Juliá, sentenced in 2013 to 13 years in prison for drug trafficking and released in 2020.