CORPUS CHRISTI — For nearly a decade, prosecutors from San Antonio to Saltillo, Mexico, have depicted Hector Javier Villarreal Hernández as a poster boy for cross-border corruption . The former treasurer of the border state of Coahuila is at the center of allegations that officials in Mexico stole hundreds […]
CORPUS CHRISTI — For nearly a decade, prosecutors from San Antonio to Saltillo, Mexico, have depicted Hector Javier Villarreal Hernández as a poster boy for cross-border corruption.
The former treasurer of the border state of Coahuila is at the center of allegations that officials in Mexico stole hundreds of millions of dollars from taxpayers and laundered the money through South Texas banks and real estate.
In his first public testimony since he surrendered at an international bridge in El Paso in 2014, Villarreal tried to shift responsibility to his former boss, Jorge Juan Torres López, who has pleaded guilty to money laundering.
Villarreal testified Friday at a sentencing hearing for Torres in Corpus Christi before U.S. District Judge Nelva Gonzales Ramos. Prosecutors put Villarreal on the stand to bolster their contention that Torres was a leader of the scheme and deserves to be sentenced accordingly.
Federal sentencing hearings are usually brief affairs. Court officials interpret the judiciary’s complex sentencing guidelines and provide judges with recommended ranges of prison time for each defendant.
But after spending much of the morning looking for an interpreter and hearing about four hours of testimony and legal argument, Ramos said she would wait until June 23 to decide on Torres’ sentence.
Villarreal painted Torres, who preceded him as Coahuila’s finance secretary and who later served as interim governor, as a ringleader in the scheme. Shortly after Torres joined the state’s finance department in 2005, high-ranking officials held a meeting to determine who would be the next governor, Villarreal testified.
Their choice, he said, was Torres.
To fund their political ambitions, state officials inflated construction and paving contracts and approved fraudulent invoices for airplane flight hours.
The conspiracy involved more than 50 people, according to the testimony. Some of that money ended up in Texas, and Villarreal said that when bankers here asked questions, Torres concocted a complex scheme that involved showing them fake contracts for the sale of airplanes to justify the income the two men were claiming.
Villarreal, who has been free on bail for more than six years and who lives in San Antonio, has borne most of the blame for more than $1 billion the Coahuila government owes creditors. He said at the hearing that the state was saddled with a deep debt when he succeeded Torres as finance secretary in 2008.
As he cast aspersions on his former boss, who sat in the courtroom in shackles and yellow jail garb, Villarreal at one point seemed regretful.
“He’s a person who’s noble and has a good heart,” Villarreal said of Torres. “He’s very direct about things, but he’s also a good person.”
Despite the respect in which Villarreal said he held Torres, his initial testimony seemed destined to increase the former governor’s prison time. He told the judge that a friendly air taxi owner overbilled the state for flight hours and used the money to buy new planes, three of which were at Torres’ disposal.
On five to seven occasions, Villarreal said, he and Torres met with a paving magnate who gave them bags of cash.
Torres kept the lion’s share.
During a contentious cross-examination by San Antonio defense attorney Carlos Solis, Villarreal revised that number, saying he was aware of only three times the businessman, Luis Carlos Castillo, paid bribes to Torres. As the testimony dragged on, Villarreal said he’d been present for two of those meetings.
Defense attorneys sought to portray Villarreal as a more important part of the conspiracy. They said he’s a fugitive from criminal charges in Mexico and that he built a real estate and business empire in Texas that dwarfed Torres’.
They said Castillo, who also took the stand Friday and is also free on bail, played a bigger role than Torres.
Castillo had admitted to bribing former governors from Coahuila and the states of Aguascalientes and Tamaulipas. In his testimony Friday, the paving magnate said he also bribed former Veracruz Gov. Fidel Herrera Beltrán, a former mayor of Cancún and intermediaries who promised him contracts in the states of Chiapas and Nuevo León. Castillo, for his part, said he was the victim of extortion schemes by corrupt officials.
Torres’ attorneys focused on the opulent lifestyles of the witnesses. Villarreal at one point drove a Mercedes-Benz SLR McLaren — “Who knows what that is?” Solis asked the judge. Only about 2,000 of the luxury cars exist.
Castillo spent only a few days in jail and lives in a mansion in a sprawling walled compound in Mission.
Villarreal and Castillo have pleaded guilty and are awaiting sentencing on money laundering conspiracy charges. Their testimony can’t be relied on to increase Torres’ sentence, his lawyers argued.
Torres agreed to come to the U.S. in 2019 after several months in custody in Mexico. He pleaded guilty last year to a money laundering conspiracy charge and turned over real estate he owns near Houston.
“It is petrifying that a man who waived extradition rights to take responsibility is now facing extra time on so little evidence,” Solis said in his closing arguments.
Torres could get a stiffer sentence if the judge agrees he was a leader of the conspiracy. Ramos also will consider whether Torres is responsible for more than $5 million that prosecutors seized from two Bermuda bank accounts, a decision that could also affect his sentence.
Torres’ lawyers said his $2.76 million account was investigated by Coahuila officials and found to be clean and that he had nothing to do with Villarreal’s $2.28 million account. But prosecutors said both were funded with bribes and that Torres helped Villarreal launder the money.
When he pleaded guilty, Torres admitted to laundering $350,000 in bribes in Texas. His attorneys signaled Friday that he’ll accept responsibility for $700,000 that Castillo transferred to his Texas bank account.
If Ramos decides that money represents the extent of his crimes, he’ll face less than four years in prison. If she agrees with prosecutors that he’s responsible for the seized Bermuda accounts, his sentence could go up by several years.
As she wrapped up Friday’s hearing, Ramos articulated one of the tricky issues she has to consider.
“I understand Mr. Torres López may have been Mr. Villarreal’s boss, but I think there was a lot Mr. Villarreal was doing on his own,” she said.