Aug 22, 1996
Trio created mass market in U.S. for crack cocaine
by Gary Webb
San Jose Mercury News
If they'd been in a more respectable line of work, Norwin Meneses, Oscar Danilo
Blandon Reyes and "Freeway Rick" Ross would have been hailed as geniuses of
marketing.
This odd trio - a smuggler, a bureaucrat and a ghetto teenager - 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. Tomorrow, 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 has been a
strictly guarded secret.
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.
Biggest military upset
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.
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 and flew into exile in California.
Today, 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.
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.
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 a heavily
censored parole report, which surfaced during the March trial.
That venture began, Blandon testified, with a phone call from a wealthy college
friend in Miami.
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 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 known 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 OKs covert operations
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."
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.
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 San
Francisco Bay Area, and for the next six years supervised the importation of
thousands of kilos of cocaine into California.
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.
Blandon, he said, was assigned to raise money in Los Angeles.
Blandon said Meneses gave him two kilograms of cocaine (roughly 4 1/2 pounds)
and sent him 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. . .
."
To find customers, Blandon and several other Nicaraguan exiles working with him
headed for the vast, untapped markets of L.A.'s black ghettos.
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.
Emergence of 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.
A friend of Ross' - a college football player home at Christmas from San Jose
State University - 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 a friend , Ollie "Big Loc"
Newell, small amounts of remarkably inexpensive cocaine.
Thanks to a network of friends in South-Central L.A. and Compton, including many
members of various Crips gangs, the pair steadily built up clientele. With each
sale, Ross reinvested his hefty profits in more cocaine.
Eventually, Corrales introduced Ross and Newell to his supplier, 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.
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."
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 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."
"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."
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 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.