60 Charged in San Diego-based Sinaloa Cartel Meth Investigation

"El Choclo" for Borderland Beat

Some of 90 guns seized from a methamphetamine distribution network, on display at DEA San Diego on June 29, 2021. (Kristina Davis: The San Diego Union-Tribune)

The U.S. Attorney Randy Grossman announced charges Tuesday afternoon against 60 alleged local members of a San Diego-based methamphetamine ring accused of working for a distribution network for the notorious Sinaloa Cartel.

Grossman was joined at 2 p.m. by officials from the Drug Enforcement Administration (DEA), Internal Revenue Service (IRS), San Diego County Sheriff's Department and others for a news conference, which was held at the DEA's office on Viewridge Avenue.

The members of law enforcement at the news conference were flanked by two tables bristling with firearms of all types, as well as boxes at their feet bearing more weapons.

Grossman described Operation Crystal Shielf as a "multi-jurisdictional investigation targeting a sophisticated San Diego-based network used by the Sinaloa Cartel to distribute methamphetamine throughout the United States and to smuggle drug proceeds back into Southern California."

The "massive" San Diego network moved "tons" of meth around the nation, including to Hawaii, Arizona, Texas, Kansas, Iowa, Michigan, Minnesota, New York, New Jersey, Massachusetts, as well as to Australia and New Zealand, Grossman said.

The drug dealers moved the narcotics around the country utilizing various means, including FedEx and UPS, according to investigators. The members of the ring will face firearm, money-laundering and drug-distribution charges. Grossman said law enforcement has seized more than 200 pounds of methamphetamine, 90 firearms and more than $200,000 during the investigation.

Several firearms and baggies of meth seized as part of a DEA investigation into a meth distribution network in San Diego are on display. (Kristina Davis/The San Diego Union-Tribune)

So far, 44 of the 60 defendants are already in state or federal custody, the prosecutor said.

"Distribution networks like this one are the arms of violent cartels, reaching out into our communities," Grossman said.

"They're also supplying a deadly stream of methamphetamine and other deadly drugs."

"San Diego is one of nine major transportation-hub cities identified under DEA's Operation Crystal Shield," said John Callery, Special Agent in Charge of DEA’s San Diego Field Division.

"Together, these cities account for about 75% of all methamphetamine traffic within the United States." Callery said that the targets of Operation Crystal Shield were purchasing over 100 pounds of meth a week, "which is an enormous amount for any city in the United States, Callery said.

Ryan Korner, who is the Special Agent in Charge of IRS Criminal Investigation’s Los Angeles Field Office, described how the criminal moved the money across international borders.

"From the evidence gathered in this case, the IRS ... and our law-enforcement partners were able to identify the mechanics of the money-laundering organization," Korner said at the news conference.

"One method utilized was moving tens of thousands of dollars in narcotics proceeds to the network's leaders via Paypal, Zelle, Venmo and Cash App accounts, in addition to shipping bulk cash." Grossman said that Assistant U.S. Attorney and Matthew J. Sutton will be one of the lead prosecutors on the case.

"The defendants in this case used cars and motorcycles with hidden compartments, they used trains, commercial airlines, the U.S. mail and commercial delivery services like FedEx and UPS to deliver their deadly methamphetamine. To protect their illegal operations, the defendants ... used encrypted communications services to communicate with each other. That is, until today."

San Diego property that US authorities searched. Description: "The residence ... is a single story family residence, with cream stucco exterior with white trim with gray asphalt shingle roof". Image was released by the US Department of Justice in the search warrant document (see sources below).

Sutton said that the lead defendant in the case, Reyes Espinoza, was the one with the alleged ties to the Sinaloa Cartel and was the main supplier and served as a conduit, the main source of supply for the meth ring, responsible for importing hundreds of pounds of methamphetamine into San Diego every week.

Espinoza lived in San Diego and also had a residence in Minnesota, which has been seized as part of the investigation. Earlier this month, a man who allegedly laundered drug money for the Sinaloa Cartel was arraigned in San Diego federal court on conspiracy charges.

Juan Manuel Alvarez-Inzunza (AKA Rey Midas), 39, was indicted by a federal grand jury in 2015, and charged with conspiracy to launder monetary instruments and conspiracy to import and distribute cocaine and methamphetamine.

He was previously designated under the Foreign Narcotics Kingpin Designation Act for allegedly laundering money for top cartel leaders, including Joaquin "El Chapo'' Guzman Loera, according to the U.S. Attorney's Office.

Summary of Charges

• Conspiracy to Distribute Methamphetamine (21 U.S.C. §§ 841(a)(1) and 846)
• Conspiracy to Launder Monetary Instruments (18 U.S.C. §§ 1956(a)(1) and (h))
• Possession with Intent to Distribute Methamphetamine (21 U.S.C., § 841(a)(1))
• Importation of Methamphetamine (21 U.S.C. §§ 952 and 960)
• Felon in Possession of a Firearm (18 U.S.C. § 922(g)(1)

Maximum Penalties

For the drug charges, term of custody including a mandatory minimum 10 years and up to life imprisonment, $10 million fine and a lifetime of supervised release.

For money laundering charges, term of custody up to 20 years’ imprisonment, a fine of $500,000 or twice the value of the monetary instrument or funds involved, and three years of supervised release.

For the firearms charges, term of custody up to 10 years imprisonment, and a $250,000 fine.

Sources: NBC San Diego; San Diego Union-Tribune; USDOJ (press release); USDOJ (indictment); USDOJ (search warrant)

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