- Originally published in The Charleston Gazette, August 26, 1996 Copyright 1996 Charleston Newspapers
By: Gary Webb, San Jose Mercury News
If they'd been in a more respectable line of work, Norwin Meneses,
Danilo Blandon and ''Freeway Rick'' Ross would have been hailed as
geniuses of marketing.
This odd trio - a smuggler, a bureaucrat and a driven ghetto teen-ager
- made fortunes creating the first mass market in America for a product
so hellishly desirable that consumers will literally kill to get it:
''crack'' cocaine.
Federal lawmen will tell you plenty about Rick Ross, mostly about the
evils he visited upon black neighborhoods by spreading the crack plague
in Los Angeles and cities as far east as Cincinnati. On Friday, they
hope, Freeway Rick will be sentenced to life in prison without the
possibility of parole.
But those same officials won't say a word about the two men who turned
Rick Ross into L.A's first king of crack, the men who, for at least
five years, supplied him with enough Colombian cocaine to help spawn
crack markets in major cities nationwide. Their critical role in the
country's crack explosion, a Mercury News investigation found, has been
a strictly guarded secret - until now.
To understand how crack came to curse black America, you have to go
into the volcanic hills overlooking Managua, the capital of the
Republic of Nicaragua.
During June 1979, those hills teemed with triumphant guerrillas called
Sandinistas - Cuban-assisted revolutionaries who had just pulled off
one of the biggest military upsets in Central American history. In a
bloody civil war, they'd destroyed the U.S.-trained army of Nicaragua's
dictator, Anastasio Somoza. The final assault on Somoza's downtown
bunker was expected any day.
In the dictator's doomed capital, a minor member of Somoza's government
decided to skip the war's obvious ending. On June 19, Oscar Danilo
Blandon Reyes gathered his wife and young daughter, slipped through the
encircling rebels and flew into exile in California.
Blandon, the then 29-year-old son of a wealthy slumlord, left a life of
privilege and luxury behind. Educated at the finest private schools in
Latin America, he had earned a master's degree in marketing and had
become the head of a $27 million program financed by the U.S.
government. As Nicaragua's director of wholesale markets, it had been
his job to create an American-style agricultural system.
Today, Danilo Blandon is a well-paid and highly trusted operative for
the U.S. Drug Enforcement Administration. Federal officials say he is
one of the DEA's top informants in Latin America, collecting
intelligence on Colombian and Mexican drug lords and setting up stings.
In March, he was the DEA's star witness at a drug trial in San Diego,
where, for the first time, he testified publicly about his strange
interlude between government jobs - the years he sold cocaine to the
street gangs of black Los Angeles.
Dealer says patriotism
for Nicaragua was motive
A stocky man with salt-and-pepper hair, a trim mustache and a
distinguished bearing, Blandon swore that he didn't plan on becoming a
dope dealer when he landed in the United States with $100 in his
pocket, seeking political asylum. He did it, he insisted, out of
patriotism.
When duty called in late 1981, he was working as a car salesman in East
Los Angeles. In his spare time, he said, he and a few fellow exiles
were working to rebuild Somoza's defeated army, the Nicaraguan national
guard, in hopes of one day returning to Managua in triumph.
Like his friends, Blandon nursed a keen hatred of the Sandinistas, who
had confiscated the Blandon family's cattle ranches and sprawling urban
slums. His wife's politically prominent family - the Murillos, whose
patriarch was Managua's mayor in the 1960s - lost its immense fortune
as well.
''Because of the horror stories and persecution suffered by his family
and countrymen, Blandon said he decided to assist his countrymen in
fighting the tyranny of the (Sandinista) regime,'' stated a 1992 report
from the U.S. Probation and Parole Department. ''He decided that
because he was an adept businessman, he could assist his countrymen
through monetary means.''
But the rallies and cocktail parties the exiles hosted raised little
money. ''At this point, he became committed to raising money for
humanitarian and political reasons via illegal activity (cocaine
trafficking for profit),'' said the heavily censored report, which
surfaced during the March trial.
That venture began, Blandon testified, with a phone call from a wealthy
friend in Miami named Donald Barrios, an old college classmate.
Corporate records show Barrios was a business partner of one of the
ex-dictator's top military aides: Maj. Gen. Gustavo ''The Tiger''
Medina, a steely eyed counterinsurgency expert and the former supply
boss of Somoza's army.
Blandon said his college chum, who also was working in the resistance
movement, dispatched him to Los Angeles International Airport to pick
up another exile, Juan Norwin Meneses Cantarero. Though their families
were related, Blandon said, he'd never met Meneses - a wiry, excitable
man with a bad toupee - until that day.
''I picked him up, and he started telling me that we had to (raise)
some money and to send to Honduras,'' Blandon testified. He said he
flew with Meneses to a camp there and met one of his new companion's
old friends, Col. Enrique Bermudez.
Bermudez - who'd been Somoza's Washington liaison to the American
military - was hired by the Central Intelligence Agency in mid-1980 to
pull together the remnants of Somoza's vanquished national guard,
records show. In August 1981, Bermudez's efforts were unveiled at a
news conference as the Fuerza Democratica Nicaraguense (FDN) - in
English, the Nicaraguan Democratic Force. It was the largest and
best-organized of the handful of guerrilla groups Americans would know
as the Contras.
Bermudez was the FDN's military chief and, according to congressional
records and newspaper reports, received regular CIA paychecks for a
decade, payments that stopped shortly before his still-unsolved slaying
in Managua in 1991.
Reagan's secret order
not enough to fund Contras
White House records show that shortly before Blandon's meeting with
Bermudez, President Reagan had given the CIA the green light to begin
covert paramilitary operations against the Sandinista government. But
Reagan's secret Dec. 1, 1981, order permitted the spy agency to spend
only $19.9 million on the project, an amount CIA officials acknowledged
was not nearly enough to field a credible fighting force.
After meeting with Bermudez, Blandon testified, he and Meneses ''started raising money for the Contra revolution.''
''There is a saying that the ends justify the means,'' Blandon
testified. ''And that's what Mr. Bermudez told us in Honduras, OK?''
While Blandon says Bermudez didn't know cocaine would be the
fund-raising device they used, the presence of the mysterious Mr.
Meneses strongly suggests otherwise.
Norwin Meneses, known in Nicaraguan newspapers as ''Rey de la Droga''
(King of Drugs), was then under active investigation by the DEA and the
FBI for smuggling cocaine into the United States, records show.
And Bermudez was very familiar with the influential Meneses family. He
had served under two Meneses brothers, Fermin and Edmundo, who were
generals in Somoza's army. Somoza himself spoke at the 1978 funeral of
Edmundo Meneses, who was slain by leftists shortly after his
appointment as Nicaragua's ambassador to Guatemala, hailing him as an
anti-communist martyr.
A violent death - someone else's - had also made brother Norwin famous
in his homeland. In 1977 he was accused of ordering the assassination
of Nicaragua's chief of Customs, who was gunned down in the midst of an
investigation into an international stolen car ring allegedly run by
Norwin Meneses.
Though the Customs boss accused Meneses on his deathbed of hiring his
killer, Nicaraguan newspapers reported that the Managua police, then
commanded by Edmundo Meneses, cleared Norwin of any involvement.
Despite a stack of law enforcement reports describing him as a major
drug trafficker, Norwin Meneses was welcomed into the United States in
July 1979 as a political refugee and given a visa and a work permit. He
settled in the Bay Area, and for the next six years supervised the
importation of thousands of kilos of cocaine into California.
It arrived in all kinds of containers: false-bottomed shoes, Colombian
freighters, cars with hidden compartments, luggage from Miami. Once
here, it disappeared into a series of houses and nondescript storefront
businesses scattered from Hayward to San Jose, Pacifica to Burlingame,
Daly City to Oakland.
And, like Blandon, Meneses went to work for the CIA's army.
At the meeting with Bermudez, Meneses said in a recent interview, the
Contra commander put him in charge of ''intelligence and security'' for
the FDN in California.
''Nobody (from California) would join the Contra forces down there
without my knowledge and approval,'' he said proudly. Blandon, he said,
was assigned to raise money in Los Angeles.
Blandon testified that Meneses took him back to San Francisco and, over two days, schooled him in the cocaine trade.
Meneses declined to discuss any cocaine dealings he may have had, other
than to deny that he ever ''transferred benefits from my business to
the FDN. Business is business.''
Lessons over, Blandon said, Meneses gave him two kilograms of cocaine
(roughly 4 1/2 pounds), the names of two customers and a one-way ticket
to Los Angeles.
''Meneses was pushing me every week,'' he testified. ''It took me about
three months, four months to sell those two keys because I didn't know
what to do. . . . In those days, two keys was too heavy.''
At the time, cocaine was so costly that few besides rock stars and
studio executives could afford it. One study of actual cocaine prices
paid by DEA agents put it at $5,200 an ounce.
But Blandon wasn't peddling the FDN's cocaine in Beverly Hills or
Malibu. To find customers, he and several other Nicaraguan exiles
working with him headed for the vast, untapped markets of L.A.'s black
ghettos.
Uncanny timing made
marketing strategy work
Blandon's marketing strategy, selling the world's most expensive street
drug in some of California's poorest neighborhoods, might seem
baffling, but in retrospect, his timing was uncanny. He and his
compatriots arrived in South-Central L.A. right when street-level drug
users were figuring out how to make cocaine affordable: by changing the
pricey white powder into powerful little nuggets that could be smoked -
crack.
Crack turned the cocaine world on its head. Cocaine smokers got an
explosive high unmatched by 10 times as much snorted powder. And since
only a tiny amount was needed for that rush, cocaine no longer had to
be sold in large, expensive quantities. Anyone with $20 could get
wasted.
It was a ''substance that is tailor-made to addict people,'' Dr. Robert
Byck, a Yale University cocaine expert, said during congressional
testimony in 1986. ''It is as though (McDonald's founder) Ray Kroc had
invented the opium den.''
Crack's Kroc was a disillusioned 19-year-old named Ricky Donnell Ross,
who, at the dawn of the 1980s, found himself adrift on the streets of
South-Central Los Angeles.
A talented tennis player for Dorsey High School, Ross had recently seen
his dream of a college scholarship evaporate when his coach discovered
he could neither read nor write.
At the end of tennis season, Ross quit high school and wound up at Los
Angeles Trade-Technical College, a vocational community college where,
ironically, he learned to bind books. But a bookbinding career was the
last thing Ross had in mind. L.A. Trade-Tech had a tennis team, and
Ross was still hoping his skills with the racquet would get his dreams
back on track.
''He was a very good player,'' recalled Pete Brown, his former coach at
L.A. Trade-Tech. ''I'd say he was probably my No. 3 guy on the team at
the time.''
To pay his bills, however, Ross picked up a different racket: stolen
car parts. In late 1979, he was arrested for stealing a car and had to
quit the trade while the charges were pending.
'Freeway Rick' hears about
popularity of jet-set drug
During this forced hiatus, Ross said, a friend home on Christmas break
from San Jose State University told him about the soaring popularity of
a jet-set drug called cocaine, which Ross had only vaguely heard about.
In the impoverished neighborhoods of South-Central, it was virtually
non-existent. Most street cops, in fact, had never seen any because
cocaine was then a parlor drug of the wealthy and the trendy.
Ross' friend - a college football player - told him ''cocaine was going
to be the new thing, that everybody was doing it.'' Intrigued, Ross set
off to find out more.
Through a cocaine-using auto upholstery teacher Ross knew, he met a
Nicaraguan named Henry Corrales, who began selling Ross and his best
friend, Ollie ''Big Loc'' Newell, small amounts of remarkably
inexpensive cocaine.
Thanks to a network of friends in South-Central and Compton, including
many members of various Crips gangs, Ross and Newell steadily built up
clientele. With each sale, Ross reinvested his hefty profits in more
cocaine.
Eventually, Corrales introduced Ross and Newell to his supplier, Danilo Blandon. And then business really picked up.
''At first, we was just going to do it until we made $5,000,'' Ross
said. ''We made that so fast we said, no, we'll quit when we make
$20,000. Then we was going to quit when we saved enough to buy a house
. . .''
Ross would eventually own millions of dollars' worth of real estate
across Southern California, including houses, motels, a theater and
several other businesses. (His nickname, ''Freeway Rick,'' came from
the fact that he owned properties near the Harbor Freeway in Los
Angeles.)
Within a year, Ross' drug operation grew to dominate inner-city Los
Angeles, and many of the biggest dealers in town were his customers.
When crack hit L.A.'s streets hard in late 1983, Ross already had the
infrastructure in place to corner a huge chunk of the burgeoning market.
$2 million worth of crack
moved in a single day
It was not uncommon, he said, to move $2 million or $3 million worth of crack in one day.
''Our biggest problem had got to be counting the money,'' Ross said.
''We got to the point where it was like, man, we don't want to count no
more money.''
Nicaraguan cocaine dealer Jacinto Torres, another former supplier of
Ross and a sometime-partner of Blandon, told drug agents in a 1992
interview that after a slow start, ''Blandon's cocaine business
dramatically increased. . . . Norwin Meneses, Blandon's supplier as of
1983 and 1984, routinely flew quantities of 200 to 400 kilograms from
Miami to the West Coast.''
Leroy ''Chico'' Brown, an ex-crack dealer from Compton who dealt with
Ross, told the Mercury News of visiting one of Ross' five cookhouses,
where Blandon's powder was turned into crack, and finding huge steel
vats of cocaine bubbling atop restaurant-size gas ranges.
''They were stirring these big pots with those things you use in canoes,'' Brown said with amazement. ''You know - oars.''
Blandon told the DEA last year that he was selling Ross up to 100 kilos
of cocaine a week, which was then ''rocked up'' and distributed ''to
the major gangs in the area, specifically the 'Crips' and the 'Bloods,'
'' the DEA report said.
At wholesale prices, that's roughly $65 million to $130 million worth
of cocaine every year, depending on the going price of a kilo.
''He was one of the main distributors down here,'' said former Los
Angeles Police Department narcotics detective Steve Polak, who was part
of the Freeway Rick Task Force, which was set up in 1987 to put Ross
out of business. ''And his poison, there's no telling how many tens of
thousands of people he touched. He's responsible for a major cancer
that still hasn't stopped spreading.''
But Ross is the first to admit that being in the right place at the
right time had almost nothing to do with his amazing success. Other
L.A. dealers, he noted, were selling crack long before he started.
What he had, and they didn't, was Danilo Blandon, a friend with a
seemingly inexhaustible supply of high-grade cocaine and an expert's
knowledge of how to market it.
''I'm not saying I wouldn't have been a dope dealer without Danilo,'' Ross stressed. ''But I wouldn't have been Freeway Rick.''
The secret to his success, Ross said, was Blandon's cocaine prices. ''It was unreal. We were just wiping out everybody.''
That alone, Ross said, allowed him to sew up the Los Angeles market and
move on. In city after city, local dealers either bought from Ross or
got left behind.
''It didn't make no difference to Rick what anyone else was selling it
for. Rick would just go in and undercut him $10,000 a key,'' Chico
Brown said. ''Say some dude was selling for 30. Boom - Rick would go in
and sell it for 20. If he was selling for 20, Rick would sell for 10.
Sometimes, he be giving (it) away.''
Before long, Blandon was giving Ross hundreds of kilos of cocaine on
consignment - sell now, pay later - a strategy that dramatically
accelerated the expansion of Ross' crack empire, even beyond
California's borders.
Ross said he never discovered how Blandon was able to get cocaine so
cheaply. ''I just figured he knew the people, you know what I'm saying?
He was plugged.''
But Freeway Rick had no idea just how ''plugged'' his erudite cocaine
broker was. He didn't know about Norwin Meneses, or the CIA, or the
Salvadoran air force planes that allegedly were flying the cocaine into
an air base in Texas.
And he wouldn't find out about it for another 10 years.