Following a three year undercover investigation during the presidency of William Jefferson Clinton, The US Departments of Treasury and Justice brought indictments against 14 large Mexican banks and 26 bankers for laundering drug money (Natta 1998; Rosenzweig and Sheridan 1998). The allegations linked the narco-trafficking Cali Cartels of Columbia and the Juarez Cartel of Mexico in a total of six money transfers involving over $68 million among 14 banks and the need to launder $1.5 billion more (Golden 1999; Beer 1998). The indictment named 29 bankers and Victor Manuel Alcala Navarro, who allegedly laundered money for the Juarez Cartel between November 11 and December 16, 1997 (Beer 1998; Natta 1998). Dozens of deposits exceeded a $10,000 statutory limit, which should have been reported as suspicious by banking officers (Varela-Cid 1999a). The transactions pointed to high levels of the Mexican government including General Enrique Cervantes (Varela-Cid 1999b; Golden 1999).
The American ambassador, Jeffrey Davidow, noted the Mexican government had been caught flat footed with the Mexican banking sector taking the brunt of the fall from this investigation and stories about American interventionism and imperialism remained atop headlines in the Mexican press for months (Davidow 2004). Political reaction from Mexico included a harsh critique of the longstanding lack of respect the US expressed for Mexican sovereignty (Davidow 2004a). Mexican officials were upset that American agents were clandestinely operating in Mexico without their knowledge and the US House of Representatives complicated the relationship following the sting known as Operation Casablanca with praise of the efforts of the agents involved in the largest expose in US history (Meisler 1998b; Zavala and Fins 1998; Buckman 2012).
The political fanfare remained short-lived. William F. Gatley, the senior investigative agent on the case, expressed harsh criticism of the Reno Justice Departments’ inability to pursue the high value politicians implicated in Operation Casablanca. He lamented, “It’s either because we’re lazy, or stupid, or the political will doesn’t exist to engage in the kind of investigation where our law enforcement efforts may damage our foreign policy,”(Golden 1999) President Clinton expressed regret that prior consultation with Mexican officials over the sting had not occurred (Myers 1998). The Mexican Attorney General threatened to indict the American agents for violating the sovereignty of Mexico (Meisler 1998a). The money launderer for the cartels, Navarro, was convicted (Rosenzweig 1999) but the Clinton Administration, dropped the charges against the banks in the following year, (American Banker 1999). As US politicians tried to patch up the political relationship amidst discussions over the unpopular, North American Free Trade Agreement, The US ambassador to Mexico, Davidow, wanted to ensure there were no more Casablancas (Davidow 2004b). Attorney General Janet Reno and her Mexican counterpart, Jorge Madrazo, met in Brownsville, Texas in the summer of 1998 to reaffirm the relationship between neighbors and signed an agreement known as the Brownsville Agreement (Reno and Madrazo 1998; Baro 1998).
The Brownsville Agreement purported to enhance cooperation between US and Mexican law enforcement (Reno and Madrazo 1998). It required that US law enforcement coordinate its clandestine efforts through the embassy in Mexico City and the Attorney General’s office (Conley 2012). Intelligence agencies in this agreement remained exempt (Millar 2010; Vulliamy 2010).
Between 2000 and 2008, while the US was engaged in military foreign policy initiatives in Afghanistan and Iraq, the US subsidized $397 million in counternarcotics efforts in Mexico and the United States (Seelke and Finklea 2014). In June of 2008, the US Congress passed legislation furthering the intent of the Brownsville Agreement with financial commitments signed an agreement called the Mérida Initiative. The Mérida Initiative is a partnership between the United States and Mexico to fight organized crime and associated violence while, “furthering respect for human rights and the rule of law,”(“Mérida Initiative” 2014). Four pillars of this initiative include: Disruption of the capacity of organized crime to operate, Institutionalize the capacity to sustain the rule of law, create a 21st century border structure, and build strong and resilient communities (Seelke and Finklea 2013). To further this relationship the US Government has given the Mexican National government $1.8 billion in support to engage in counter-narcotics efforts (Cook and Seelke 2008).
This subject has been expanded into an academic work and published as a Master’s Thesis which measures the impact of these policies Entitled:
Thank you for checking it out.
The Brownsville Agreement and the Mérida Initiative were collaborative inter-agency agreements between the United States and Mexico. The War on Drugs has taken thousands of lives on both sides of the border and these agreements provided a collaborative framework to influence the outcome of the war. Using Outcomes Theory and Time Series/Intervention Analysis, multiple outcomes demonstrated that consequences from these policies were an overwhelming loss for the War on Drugs. After these policies were implemented, drug use in the US rose, overall arrests remained static and street-prices of these illicit substances fell.
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