US Lawsuit vs. Staff of Mexican Presidential Candidate Peña Nieto Reveals Apparent Violation of US Law

No Foreign Agent Complied With Requirement to Register in US on Behalf of the PRI Candidate’s Campaign

By Bill Conroy & Al Giordano
Special to The Narco News Bulletin

June 19, 2012

A civil lawsuit filed this month in US court against several Mexican companies and three top officials from the campaign of Mexican presidential candidate Enrique Peña Nieto alleges the parties engaged in a conspiracy to convert campaign funds derived from narco-traffickers to their own personal use by employing a scheme to defraud a US company.

The lawsuit also alleges that Peña Nieto campaign operatives threatened a plaintiff that the money “was funded from companies owned by drug cartels and it was further stated that Jose Aquino [owner of Frontera Television Network] must be very careful not to make any noise or his life is in danger.”

The complaint charges the defendants with two counts of “racketeering” under the RICO (Racketeering Influenced Corrupt Organization”) laws, plus charges of Fraud, Breach of Fiduciary Duty and Negligent Representation. It seeks $100 million dollars in punitive damages from the defendants.

Narco News today makes the court documents and evidence available for review by citizens and journalists of both countries, and internationally.

In the extensive court documents are two contracts:

The first was signed in Mexico on November 28, 2011 and agrees to pay $15 million dollar to the US company Frontera Television Network, represented by José Aquino, and is signed by representatives of two Mexican companies, GM Global Media, represented by Mario Ignacio Moran Jimenez, and Jiramos, represented by Alejandro Carillo Garza.

A second contract, which replaced the initial pact, that is evidence in the lawsuit was for more than $50 million dollars in advertising and publicity services, signed on January 6, 2012 between two Mexican companies and a US media company. It details an ambitious advertising and public relations campaign on US television, radio, Internet and print media, plus billboards and other media that would reach Spanish-speaking Mexicans living in the United States. The company Intelimedia S.A. DE C.V., represented by the signature of José Aquino on the contract, would serve as an ad agency and public relations manager for a Mexican company called Servicios Integrales al Sector Agropecuario, represented by the signature of Alejandro Ramírez González. Multi-million dollar categories ($25 million for television advertising alone) totaling some $56 million were detailed in four sections of the contract, each page initialed by the signatories, according “Exhibit A” in the lawsuit.

The common thread in both contracts is the signature of José Aquino, on behalf of Frontera Television Network in the first contract and Intelimedia in the second.

Aquino’s Frontera Television Network filed the lawsuit on June 7 in the US District Court of Central California against the aforementioned companies plus three high officials in the presidential campaign of Enrique Peña Nieto: Erwin Lino, the candidate’s personal secretary, David López, the candidate’s communications director and Roberto Calleja, spokesman for the Institutional Revolutionary Party (PRI, in its Spanish initials), which has nominated Peña Nieto as its presidential candidate in the July 1 election.

One of the Court documents in the Frontera litigation mentions Pena Nieto specifically, indicating that he “may have a direct, pecuniary [monetary] interest in the outcome of this case.”

The court pleadings allege that the $56 million media promotion contract was breached and the money never delivered to Frontera and its affiliates, but instead the funds were diverted to the personal use of Pena Nieto’s operatives.

Did Peña Nieto Violate US Law?

What is not mentioned in the litigation is a US law known as the Foreign Agents Registration Act, which requires agents representing foreign entities (such as political parties like the PRI) to register with and make specific disclosures to the US Department of Justice.

The DOJ Web site says the following about FARA:

The purpose of FARA is to insure that the U.S. Government and the people of the United States are informed of the source of information (propaganda) and the identity of persons attempting to influence U.S. public opinion, policy, and laws. In 1938, FARA was Congress’ response to the large number of German propaganda agents in the pre-WWII U.S.

Failure to comply with FARA, the DOJ Web site states, is punishable, upon conviction, “by a fine of not more than $10,000 or by imprisonment for not more than five years.”

Narco News checked the online filing database for FARA registrants and also contacted the DOJ FARA office to determine whether any of the parties central to the Frontera lawsuit had registered under the act. The online database check revealed no such filings and a spokesman for the FARA office indicated he also was unaware of the litigation — and even asked for the case number for the Frontera lawsuit.

Based on a reading of the FARA statute, it would appear a case could be made that, at a minimum, Frontera Television Network, as well as the companies alleged to have links to Pena Nieto’s presidential campaign and who were signatories to the media propaganda contract (included as an exhibit in the lawsuit) should have registered under FARA — assuming the allegations in the court pleadings are truthful.

Narco News contacted Frontera’s attorney, Maxwell C. Agha, but he was unavailable for comment on the FARA requirements.

The catch in all of this, however, is the veracity of the alleged contract included in the litigation, and whether it can be proven that PRI Party operatives were behind it.

A FARA office spokesman says in order for FARA to be invoked, it has to be shown that the businesses involved in such an alleged contract “were under the direction and control of a foreign government or political party.”

Determining the truth of the matter will be at the heart of that litigation, but clearly the stakes for Pena Nieto could be quite high should a jury rule in Frontera’s favor in the litigation, given it may well open the door to an inquiry from DOJ as to whether Pena Nieto and/or his staff members violated a US criminal law (FARA) — not a good outcome should Pena Nieto be elected president, and one that could provide US officials additional influence, personally and legally, over a possible President Peña Nieto when it comes to pressuring Mexican officials to hand over sovereign decisions to the neighbor up north.

Explosive Charges

The explosive charges were made public three weeks before the July 1 Mexican presidential election and are being vehemently denied by Pena Nieto, whose spokesman contends, according to a story in the Mexican publication Proceso, that he is, in fact, the one who is the target of a fraud perpetrated by the US company and its representatives.

The Proceso story states that Pena Nieto —the 2012 Mexican presidential candidate for the Institutional Revolutionary Party (PRI, in its Spanish initials) — has called on Mexico’s Attorney General to prosecute the plaintiffs for having brought the lawsuit in the United States.

The central charge in the lawsuit, filed in US federal court in Riverside, Calif., is that several companies and individuals linked to the Pena Nieto presidential bid diverted campaign funds obtained from “drug cartels” to their own “personal use.”

To cover up the alleged money laundering scheme, pleadings in the lawsuit claim, the Pena Nieto operatives contracted with Nevada –based Frontera Television Network LLP — and later one of its affiliates — to design a media campaign to promote Pena Nieto’s presidential run in US-based media. Many Mexicans have cable TV and Internet connections and watch Univision and CNN Español and even English-language channels. In addition, Mexicans living along the Mexican/US border, in places such as Juarez, Tijuana or Nuevo Laredo, watch TV broadcasts from US stations.

The supposed truth to be revealed through the litigation, according to the Frontera lawsuit, is that two Mexican companies and their representatives inked a multi-million contract in November 2011 with Frontera Television Network on behalf of PRI officials “David Lopes, Erwin Lino … and Roberto Calleja….”

The contract called for Frontera to design a “political advertising” campaign for Pena Nieto that would make use of US “magazines, radio, television, Internet and social networks.”

That initial contract was replaced in early January 2012 with a similar pact that, according to the litigation, included as signatories an affiliate of Frontera, called Intelimedia, and a company created by the defendants, called Servicios Integrales Al Sector Agropecuario S.C.. But, the pleadings assert, that contract also was breached and the same diversion scheme remained in place.

From Frontera’s complaint in the lawsuit:

… Each of [the defendants] refused to pay for the advertising campaign for PRI candidate Enrique Pena Nieto. Defendants … concealed the fact that they converted the [$56 million in] advertising funds for their own private and personal use.

… The United States for PRI campaign for the political presidential candidacy of Enrique Pena Nieto continues to operate in Mexico, and there is a continuing threat of criminal activity until the United States for PRI campaign for the political presidential candidacy of Enrique Pena Nieto Enterprise has accomplished its goal of converting campaign funds for it’s own private and personal use including funds contributed by drug cartels.

… Frontera Television Network LLP through it’s authorized agents contacted the PRI officials David Lopez, Erwin Lino, Roberto Callejas, Alfredo Carrillo, and Jose Carrillo, and Plaintiff Frontera Television Network LLP through it’s authorized agents were threaten by it being stated that the money that was originated was funded from companies owned by drug cartels and it was further stated that Jose Aquino [owner of Frontera Television Network] must be very careful not to make any noise or his life is in danger.

The plaintiff, Frontera Television Network, is seeking compensatory damages in an amount to be determined at trial plus $100 million in punitive damages, as well as an injunction “prohibiting any disbursements of any [Pena Nieto] campaign funds pending the hearing on this matter,” the legal pleadings state.

The defendants, including the officials allegedly representing Pena Nieto, have not yet filed a response with the US court.

Court Documents of public interest:

– Text of lawsuit complaint seeking $100 million in damages (English).

– Notice of Interest for Enrique Peña Nieto (English).

– “Exhibit A”: Multi-million dollar contracts for media campaign in US (Spanish).

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