Business behind bars: a rare glimpse into the inner workings of El Chapo’s drug cartel

The Sinaloa Cartel is the world’s largest drug empire, run by the man known as El Chapo. After months of persistence, the Sunday Night team have worked their way inside this dangerous group.

The danger is real. Mexico is one of the world’s most deadly countries for journalists, with 64 murdered in the past ten years. It’s not hard to see why – reporter Steve Pennells and the crew are taken to a small hut with the latest shipment – 360 kilograms of pure cocaine. It’s proof that while El Chapo is in prison, he’s also still in business.

El Chapo has been locked up in New York’s Manhattan Federal Prison for two years, awaiting trial for numerous drug conspiracy charges.

His real name is Joaquín Guzmán. His nickname, El Chapo, means “Shorty” – he’s only 5’7”.

El Chapo grew up in Sinaloa, in north-west Mexico. Here, drugs are not just a business, they’re a religion. The narcos even pray to their own saint, Malverde – not quite Vatican approved.

The visit has been sanctioned by Pedro – El Chapo’s cousin. For mountain people like Pedro, El Chapo is a mythical figure, revered in dozens of folk songs. The boss might be in prison, but he still rules the place.

Pedro explains just how the locals perceive of El Chapo. “He’s polite and very likeable, well mannered. He generates many jobs for people because here he has business, not just drugs. He helps anyone in need, since he is the one who has the money. People here in the mountains love him.”

Journalist Anabel Hernandez was driven to expose El Chapo’s vicious rise to power through her own private tragedy – the murders of a close friend and her father.

“My father was kidnapped and murdered in Mexico City,” she tells Steve Pennells. “This sense of impunity hurts you in this deep, deep way.”

Anabel has tracked El Chapo’s brutal rise from peasant farmer to narco king. “When he was 16 years old, he started to grow his own little illegal [poppy and marijuana] fields with his cousins. El Chapo was just one of thousands of these kids, [and] became this big drug lord.”

He was in the right place at the right time, and began forging links with Columbian drug lord Pablo Escobar, learning how the business worked.

The raw ingredients for the Sinaloa cartel’s heroin are grown in Mexico’s mountains. Poor farmers harvest secret crops of poppies, and milk from these will be turned into heroin – which eventually make its way to Australia.

It’s a big business – and it got this way because of a multitude of corrupt police and politicians who have allowed El Chapo to prosper for so long.

The drug lord was first captured back in the early 1990s. Many of the prison staff were on his payroll, and so he eventually escaped in 2001. He managed to evade authorities for another 13 years, becoming notorious for building elaborate tunnels to ferry his drugs across the U.S. border.

As a young Drug Enforcement Agent, Drew Hogan joined the hunt for El Chapo.

“By the time I got to him, a lot of people had given up,” Hogan explains. “There was more than a decade of failed attempts by both United States and Mexican governments. Chapo would be alerted an hour before, minutes before, and he would escape out the back door.”

Working with an elite group of Mexican marines, Hogan began to monitor El Chapo’s Blackberry phone connections, and he soon discovered an Australian connection.

“[We heard] him talking about… him wanting to secure warehouses for ‘fruit deliveries.’” says Hogan. “We conducted a raid on his house, we find these fake bananas and cucumbers hey are using to smuggle cocaine in.”

“It’s a huge operation. We’re talking about smuggling you know these tonne quantities in submarines, in large boats, in go-fast boats, aircraft, and by tractor trailer.”

Drew Hogan knew he had to contend with a massive network of corrupt officials who were protecting the narco boss.

“Payoffs were rampant to corrupt Mexican government officials, through the military, through law enforcement,” Hogan explains. “He really had his whole state dialled in on the payroll, and knew the movements of military [and] law enforcement as they got closer to do him.”

That constant stream of leaks allowed El Chapo to stay one step ahead, using safe houses with escape tunnels. But Hogan and a small group of Mexican Marines were finally able to track El Chapo to a hotel complex in the resort town of Mazatlan.

El Chapo was in room 401. It was just before dawn. El Chapo was asleep in bed, his young wife and twin daughters by his side. Marines burst in and captured the world’s most dangerous man without a fight.

“I ran right up to him, jumped right into his face,” Hogan recalls. “We locked eyes, and I yelled the first thing that came to my head which was, ‘What’s up, Chapo!’

El Chapo was locked up in the high security Altiplano Prison – but not for long. He very quickly took the control of the jail. In his cell, El Chapo was under video surveillance – yet no one acted when he disappeared in the cell’s shower. It took 18 minutes for anybody to raise the alarm. He had built an extraordinary tunnel that ran from beneath El Chapo’s cell to a house over a kilometre away.

This was supposed to be Mexico’s most impenetrable prison. But somehow, the drug lord escaped, becoming the only man to ever break free from Altiplano. El Chapo was on the loose again.

El Chapo was soon back in his mountain stronghold. It seemed he was now starting to believe his own hype, and his ego became his undoing. He secretly met with Hollywood actor Sean Penn and Mexican soap star Kate del Castillo to discuss making a movie about his life.

Mexican authorities tracked phone calls about the meeting and began closing in. On the 8th January 2016, they attacked his hideout on the north-western coast. In the early hours, Mexican marines surrounded the house in the regional town of Los Mochis.

“That operation was not [to] arrest El Chapo,” Anabel Hernandez says. “That operation was to kill him.”

In the gun battle that erupted, several of El Chapo’s men were killed, but El Chapo and a lieutenant escaped into the sewers. Emerging, the two men were stopped by a Federal Police roadblock. El Chapo tried both threatening and bribing, yet with so much attention, the police knew they had to do the right thing.

They brought El Chapo to a motel on the edge of town to buy time until reinforcements arrived. In the room, he was handcuffed to the bed, where El Chapo’s reign finally came to an end.

For some months, Chapo was again locked up in the Altiplano Prison. But now, El Chapo was a political pawn. On the 19th January 2017 – the day before Donald Trump’s inauguration as President – the man dubbed the world’s worst gangster was deported to the U.S. for trial.

Now 61 years old, El Chapo has spent two years behind bars at New York’s Federal Prison, awaiting trial for multiple drug charges. The prosecution wants a life sentence and 14 billion dollars in drug proceeds.

As part of a deal with the Mexican Government, the Americans cannot give him the death penalty – better than the fate of many other drug lords back in Mexico.

Yet even with El Chapo behind bars, his cartel is still flourishing. In his absence, it’s being run by his brother and two sons. One of them, Alfredo, openly flaunts the family wealth on Instagram, taunting the Americans – who have put him on their Top Ten Most Wanted list.

Yet El Chapo’s fortune is not in any trouble. The 360-kilogram stash of cocaine shown off to Steve Pennells and the Sunday Night team is worth a fortune – in the ballpark of $108 million. They were told the drugs came from Colombia, and destined for the streets of Los Angeles.

The cocaine is packed into two different cars and driven to the coast. The exchange goes down fast – many millions of dollars’ worth of cocaine is shifted from the cars to a waiting boat. From here it goes to a larger boat two kilometres offshore, then north up the Gulf of California to San Felipe, before crossing the border by road to Los Angeles – and from there to the world.


Reporter: Steve Pennells

Producer: Michael O’Donnell

Sunday Night’s El Chapo story features Mexico’s most famous researcher of the Narco State, Anabel Hernandez. Her book, Narcoland, is an eloquent account of how El Chapo’s empire fits into Mexico’s political and business networks. Find more about it here.

Former DEA agent Drew Hogan was a key part of the arrest of El Chapo in Mazatlan, Mexico, in 2014. He details the hunt in his book, Hunting El Chapo. You can find it online here.