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A veteran of the war on meth and head of Fresno's (Calif.) Meth Task Force, Pennal describes how the super labs of California's Central Valley became the "industrial center" of meth production in the late 1980s after Mexican drug kingpins moved in and turned meth into a hugely profitable business.This is an edited transcript of an interview conducted on Aug. 8, 2005.

Describe how the invention of the super lab changed the meth industry.

For us, specifically around 1989, we started hitting labs that were just huge, and they involved Mexican national traffickers. We went from a meth problem in California controlled primarily by specific groups like outlaw bikers, and now we started seeing industrial-sized factories set up in California. We started seeing it out in our deserts; we started seeing it all throughout the Central Valley, where these organizations fit in well with the farm labor community. They had established family networks there. … These are individuals that weren't meth users. These were people that are in it strictly for the business.

So if you're going to manufacture at that type of pace, you have to have an endless supply of the precursor chemical, the chemical that becomes meth. And that started [the focus on] ephedrine and pseudoephedrine. And before you know it, we're having it imported from all over the world. …

The way cocaine in Colombia was the Medell�n cartel, now we were basically the suppliers for everyone in the United States out of California.

It was all about making hundreds of pounds at a time, diluting at the scene, cutting it, converting it. Now they convert to ice methamphetamine, which is just larger crystals, [and they] package it and distribute it throughout the rest of the United States. …

Our [California manufactured] methamphetamine started showing up everywhere in the United States. That's when we realized that we were being used basically as the industrial center. We were basically the Medellín. The way cocaine in Colombia was the Medellín cartel, now we were basically the suppliers for everyone in the United States out of California. …

What's the difference between what people think of [as] a garage lab and a super lab?

Meth user labs, or small toxic labs, are labs that are commonly set up by people that abuse the drug. They manufacture very small amounts, and they use household items. They cook in mason jars, … and they manufacture on a very small scale, grams to ounces. They personally use the methamphetamine. Then they turn around and they sell to their friends, but they also teach their friends how to manufacture.

So now you take a small little community that's, say, in the Midwest, and people start manufacturing. Before you know it, it starts to parlay itself, and everybody's manufacturing, and everybody's teaching everybody how to do it, because it's essentially right there in front of you. It's very easy to manufacture till you make a mistake. And that mistake can be fatal, or that mistake can blow your house right off the foundation. But that's what happens. It's just common household items, [whereas the] super lab, large, industrial-sized factory, … when they do a large-scale manufacture, they might come out with 80, 100 pounds during one cook cycle. …

How did the supply of meth change on the street once the Mexicans started industrializing it?

We originally used to purchase a lot of heroin, cocaine from many of the Mexican drug cartels. And then when they started getting into methamphetamine, they started saturating their own market with methamphetamine.

It used to be where if you turned around and met with a trafficker, they would supply samples, and those samples would be maybe ounces of methamphetamine. Or we'd go buy ounces. Now we turn around, and just in the last decade, we see where, to bring 10 pounds of methamphetamine out, [they] just have one person. Normally when you do a deal that's that large, you always have protection. You always have people with you to cover you. In this business, you know, it's a dangerous business, so there's gunplay. But all of a sudden we turn around, and where we used to do ounces and quarter-pounds, now everybody's doing 10, 25 pounds like it's just nothing. And we just sit back and are like, "My gosh."

Then for us, the price, it used to be about $10,000 for a regular pound of methamphetamine. All of a sudden we see the price go down to $3,500, $4,000 a pound. But now what they do is they convert the methamphetamine to ice, which is basically their way of just converting it to larger crystals, and then they sell it for $9,000 to $13,000 a pound. Basically they've saturated the market. …

So if you're cooking 100 pounds in a cook cycle, how many doses of meth is it?

… First of all, when you talk about it being diluted down and distributed, you're really talking close to 400 pounds of methamphetamine. And you're slowly breaking it down, and you're up well into the thousands and thousands of dosage units, because you're taking 1 pound, which is 454 grams, and you're turning around and you're selling those grams maybe for $60, and they're turning around and they're cutting up those grams, and they're selling them for a 10th of a gram as a dosage unit.

I'll give you a good example: A 100-pound cook -- $4 million is going to be made off of that cook when it finally reaches the street. …

One of the things about methamphetamine is that it's a highly profitable drug for what you're investing. Probably one of the most profitable, of course, is marijuana. But methamphetamine, you turn around and you invest $1,400 to $1,600; they're turning around and they're taking that investment and making anywhere from $10,000 to $20,000.

That's one of the reasons that you do it, because it's all about the money -- because one thing about the drug business, it's all about greed. Doesn't matter who it is, doesn't matter who you are, everybody eventually draws into the greed. Whether it be the property owner who's letting them cook on their property, whether it's the distributor or whether it's the person that's buying, they all get drawn into it, and they all get taken off eventually.

Tell us about the Amezcua brothers.

The Amezcuas were one of the first people that realized you needed to have ephedrine to manufacture meth, and it appears [to them that] this meth is going to just take off, and this is going to be the next drug.

So they started importing into Mexico tons and tons of ephedrine. And then they started smuggling it into the United States. And it started coming up in Southern California, into the Central Valley. Before you know it, now they started these large-scale [labs] manufacturing methamphetamine.

When all the ephedrine starts up, it's converted to meth, and then the meth is sold, and the money starts back down. Eventually they were just buried in money. …

The Amezcuas actually went to India to get the ephedrine?

… A lot of the ephedrine that we were seeing was coming out of India [and] the United Arab Emirates. … It was basically brokered through Germany. But they literally sent people out there to start looking for ephedrine and developing their own sources, and they turned around and basically they established their own global network to bring ephedrine in before anybody else had even thought about it. And then when it took off, they're the ones that reaped all the benefits from it. …

There was times where they were bringing in hundreds of thousands of pounds of ephedrine. And the thing you've got to remember, if you have ephedrine, it normally coverts over anywhere from 50 to 70 to 80 percent, depending on how good of a meth cook you are. So you turn around and you have a ton of ephedrine, like they had, you're talking a little less than probably three-quarters of a ton of meth is manufactured just off of that shipment. And they had cargo container after cargo container coming in. …

How well did they and the other Mexican cartels adapt when ephedrine powder was regulated?

In the early '90s, when we were really getting impacted by these individuals, we used to see ephedrine powder, always packaged in tins. A tin was a cardboard box that had literally a lining inside that was tin that had a plastic bag that had 25 kilos of ephedrine -- basically 55 pounds.

We used to see those tins everywhere. … So all of a sudden, we start seeing pseudoephedrine pills show up as tablets, and we start seeing these little rural chemical companies popping up all over the country. And all of a sudden we go to these lab sites, and there's garbage bags and garbage bags of empty bottles, and they all have been razor-cut at the bottom, and they've dumped all the pills out.

But when they dump the pill out, they have to remove a binder, which holds the pill together. Lots of times that binder is cornstarch. So what they did is, they would use huge, huge containers full of denatured alcohol, and they'd evaporate it off. Well, now we started having fires and explosions. Now we started getting ranches blowing up all over our state. Before you know it, 60 percent of the labs we were dealing with were through fires and explosions, because they were learning, and they were making mistakes. But as they started to do more and more manufacturing, they got better and better at it. It was just their ability to adapt to whatever we threw at them. …

The flip side, at the same time, we are shutting down chemical companies in California right and left that are supplying Freon, one of the primary solvents. What do they do? They realize that we're controlling Freon, they turn around, they start using other solvents. They eliminate Freon.

We turned around and we put controls on hydriodic acid. You have to have the hydriodic acid to manufacture meth. We're going to put controls on it. We're going to make it an illicit chemical; you can't get it.

All of a sudden, before you know it, we hit a huge hydriodic acid laboratory in Fresno, [Calif.], in the basement of a house -- hands down one of the worst environments I think I've ever been in, as far as labs go, in my career. … Their ability to adapt was very simple: "We're just going to turn around, and we'll make our own," because it's very, very simple to make. And they just started making their own HI [hydriodic acid].

[How did you handle] these rural middlemen who are importing all these pills with licenses [from the DEA, in accordance with legislation passed in 1996]?

… We get together with the Drug Enforcement Administration; we start putting together a strategy for the whole United States to shut these places down, and all of a sudden the United States Attorneys' Office comes onboard, and we start aggressively going after these companies. We go in, and we start legally notifying them, and we start telling them, "Hey, your pills are being found at laboratories in California," and we started identifying suspicious sales. We started enacting more laws where they couldn't do what they were doing.

Then what happened was the federal government started going after them, started shutting these places down. They started to aggressively pursue these companies, and they started taking them to jury trial, and they started taking them to court. All of a sudden we were winning, and all of the sudden they realized, "Oh, this isn't going to work so well." Then all of a sudden they start disappearing. Then as fast as they disappear, all of a sudden here comes something else. …

What was it like to find all the Canadian pills?

We're going along, and now all of a sudden we start seeing more and more of these mom-and-pop vitamin stores and everything. They're not shipping anymore. We're not finding these bottles. But now we start finding these 60-milligram, 1,000-count white bottles with no markings on them. You always have markings on them; you always have lot numbers; you always had some type of identifier. But now we had nothing except near the bottom. There was some writing in French, and it would identify Canada.

We're thinking, well, where are these coming from? And then before you know it, everywhere we go, we're finding them everywhere. I think at one point, we actually were talking one day, our team; we're just thinking, it's almost like a newsletter is sent out to the whole network of cookers, and they'd make this transition over all at one time.

… We started doing surveillances, and all of a sudden we started having some of our large Mexican drug cartel traffickers meeting up with individuals from out of state, Middle Eastern. And we started realizing, wait a minute, there's something going on here. …

These organizations are going up into Canada. They're starting companies … and they're importing pseudoephedrine from all over the world, and then bringing it into the United States. Then it's coming out to our area in a tractor truck. …

[Southern California and the San Jose Drug Enforcement Administration office] found, I think it was 10.5 million pseudoephedrine tablets. That was just one stash house. … It just gave you an idea of just how large-scale the manufacturing was.

And I'll tell you what: There was not a lot of people that were really aware of it. We knew it in California; we knew about it with DEA. We all worked together to formulate a plan and everything. But people just really didn't realize it.

I can tell you one group of people that didn't realize it. When we started doing a lot of training and educating a lot of people up in Canada, they were going to do whatever they could to help us, but until people started seeing what these super labs looked like and what this industrial-sized manufacturing looked like, all of a sudden they just would watch our presentations, and they'd say, "My, I had no idea it was this big."…

So the Canadian connection gets shut down, and the trade moves to Mexico?

… All of a sudden, now we don't see hardly any pseudo coming from Canada. It basically comes to a screeching halt. Then all of a sudden now we start seeing pseudoephedrine pop up from Asia. We hit a big super lab at a farm just north of here, and we go in there, and all of our pseudo is from Asia. Thousand-count bottles, 60 milligrams, all labeled, it's from Asia. How did it get here?

Now we have a new source of pseudoephedrine, and now we turn around and start focusing our attention into Mexico itself. In Mexico, the list is very, very small as to what's controlled down there as far as chemicals. …

And now [the drug cartels] realize that they can start importing into Mexico. And then what do you start to see? You start to see manufacturing in Mexico. You start seeing labs set up there.

Now we start seeing our chemicals coming, and it's all being smuggled from Mexico into the United States. They conceal everything in hidden compartments, and it's brought up here. And then they turn around and they continue to manufacture up here. …

Why do you think it's taken so long for the alarm to go up? Now all the media's covering it, but you've been on it for 16 years. Why has it taken so long?

I think one of the things that happened was, when we first started seeing it around '89, "Hey, this methamphetamine problem [is] really, really starting to take off," [it] involved these big Mexican drug cartels. And right then, there was a lot of other drugs out there -- cocaine, the crack epidemic. It just really didn't play well. We just didn't get a lot of attention.

However, within the law enforcement community, a lot of us knew it was bad, and that's where we started forming these committees and groups with DEA where we started going after these chemical suppliers and everything.

But it just really hadn't taken off yet. And there wasn't a lot of high-impact lab seizures or real high-impact news that really got everyone's attention. In California, the Kathy James lab explosion which killed her children -- basically she ran out of the lab and let her kids burn to death. She was convicted [of] second-degree murder. The Kathy James incident down in Riverside County really impacted our state, and everybody said, man, there has got to be something done. And that's the type of thing that happens normally.

Let me tell you, as methamphetamine started to spread across the Midwest, and people had more and more access to recipes, and they could go onto Web sites and buy books and everything. … People started to use methamphetamine and started to use it instead of cocaine because it was a more potent stimulant and lasted longer and everything. And before you know it, you started to see the transition over [to it]. …

Now people start hearing all those cases, it starts getting played in the media, and now everybody in the world realizes, man, this methamphetamine is bad. And everybody says, oh, marijuana's bad, heroin's [bad] -- these drugs are all bad, too. But now they go out and they start surveying the counties in the United States, and all of a sudden they start looking at the numbers, and over 50 percent of them are saying, no, meth is our problem. …

What has the pollution and environmental impact been?

[In the Central Valley], we estimate between the year 2000 and 2004, based on the laboratory dumpsites, the laboratories we've seized, the chemical containers we've seized -- between 4 and 7 million pounds of lab waste have been poured into the canals and into these vineyards and dumped on these farmers' and ranchers' properties.

We'll be on a covert surveillance watching a lab site, and all of a sudden here comes somebody out with a big garbage can, out to a canal, pouring this stuff into a canal. And we're just looking at it through binoculars. It's like, you have got to be kidding me.

To give an example of what the business is like. We raided a lab years ago with the Fresno Police Department, and when we hit this lab, it was at a ranch. And boy, I'll tell you what: It was a beautiful ranch, but it was just a farmhouse for a laborer.

We hit the place, and of course the owner of the property pulls up, [says], "What are you doing on my property?" "Well, we just raided a very, very large methamphetamine lab." I'll never forget this. "Well, he's one of the best employees I've ever had. He's worked with me for nine years. I just gave him a raise to $6 an hour."

And we're just looking at him. This guy had three, four kids -- I can't remember -- and the lab was set up where there used to be a water tank in these old farmhouses upstairs, and they brought all the chemicals through the children's bedroom, and all the waste that was spilling was all in the carpet where the kids lived and slept. And they brought him downstairs, and all the children are there.

We walked the rancher over to the little farm laborer's truck, and in a paper sack is $27,000, and we tell him, "Well, you might have given him a raise to $6 an hour after nine years, but it appears the second job is paying a little better." And that is what it's all about: You know it's wrong; you get drawn into it. The greed kicks in, and you turn around, and all of a sudden, there's more money than you can ever imagine.

But what happens? This guy's life is changed forever. ... Everybody went to jail for a long time. ...

Are there signs of the drug traders getting desperate? Are there other examples of the drug traders adapting?

Their ability to adapt was really amazing. ... We started seeing what is referred to commonly in our business as smurfing.

Remember how the Smurfs were little gatherers? Well, now all of a sudden, we started getting calls from different retail stores that people were coming in and buying two or three packs. You know, California, 9 grams, three packs -- that's the most you can buy. And all of a sudden, they turn around and they went to one store; they bought three. They went to another store, bought three.

Before you know it, they went up and down the entire Central Valley, and before we knew it, we're starting to see blister packs everywhere. Why? Because they're sitting in the cars. They're punching the pills out of the blister packs. They're putting them in the freezer bags. They're turning around, and they're turning them over to chemical brokers. Chemical brokers always want to see the busted-out packs, because they want to have a good idea that you bought what you said you were going to buy.

Very simple. You supply the receipts: This is how much we spent. They're going to triple that normally. They're going to take care of you. ... Now you make $1,000 for a day. Why? Because all you did was smurf around all day, because you can get it over the counter. And they have to have it. Because why? Pseudoephedrine is the precursor. You have to have it.


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posted feb. 14, 2006

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