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U.P.R.R. fights $38 million in border drug fines


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  • U.P.R.R. fights $38 million in border drug fines

    Published Sunday August 3, 2008
    U.P. fights $38 million in border drug fines

    Five years ago, federal Customs and Border Protection agents found a false wall in a railcar that had rolled into Brownsville, Texas, from Mexico.

    They cut a hole in the side of the empty car and found 99 packages of cocaine totaling more than 250 pounds.

    It was the second of 42 instances — the most recent of them June 7 this year in Nogales, Ariz. — in which the federal government cited Union Pacific Railroad for drugs found aboard railcars handed off to the Omaha-based railroad at the Mexican border.

    The cocaine found in Brownsville on June 16, 2003, brought a $4.1 million penalty down on Union Pacific. Penalties in the other 41 cases, all involving marijuana, raised the ante to $37.8 million.

    Union Pacific hasn't paid the fines and last week sued the Department of Homeland Security in U.S. District Court in Omaha, asking for an order blocking the penalties.

    The railroad argues that it has no control over what might be hidden in railcars in Mexico. The government said in a letter in April that there are patterns to the way the drugs are hidden and that U.P. should recognize them and inspect the cars in Mexico.

    The Department of Homeland Security, under which Customs and Border Protection operates, has not filed a response. A spokeswoman said Friday that Customs and Border Protection would not comment.

    The case plays out against a backdrop of Mexican drug cartel violence.

    U.P. said in its court documents that it is unsafe to send its people into Mexico.

    A security operation in Mexico, whether by U.P. employees or a third-party contractor, would expose those people to the risks of murder and mayhem at the hands of Mexican drug cartels, the railroad maintains.

    To make its point, the railroad noted the May 8 assassination of Mexico's national police chief, Édgar Eusebio Millán Gómez. U.P. also submitted reports of Mexican police chiefs seeking asylum in the United States because they feared for their lives.

    Any inspection program U.P. might operate in Mexico would be futile, the railroad says in its lawsuit, because its police officers would have no authority there, could not carry guns in Mexico and can't take their drug-sniffing dogs there.

    They might risk arrest for possession of drugs they found, according to the lawsuit, or at least would have to turn over the drugs to Mexican police, who may be involved in the drug trade.

    The railroad said it takes possession of the railcars only after they cross the border and have undergone inspection by Customs and Border Patrol agents.

    While those handoffs — which may include a switching of locomotives — are happening, a train may stretch two miles back into Mexico and is exposed and unsecured against tampering, U.P. says.

    Customs and Border Protection told Union Pacific in a letter in April that if the railroad cannot by itself provide inspections in Mexico, it should work with its business partner, the Mexican railroad Ferrocarril Mexicano (Ferromex), or hire an outside security company.

    "In today's environment, this effort is paramount not only to drug interdiction, but also to our national interest in the fight against terrorism and the smuggling of weapons of mass destruction," the Customs and Border Protection letter said.

    Hiring an outside security contractor is what air and ocean carriers do when operating in high-risk areas, the agency said.

    In all but one of the 42 cases, the hidden drugs were found in railcars brought to the border by Ferromex.

    U.P. owns 26 percent of Ferromex but says that doesn't give it any authority over the Mexican railroad's operations.

    U.P. is unable to compel Ferromex to take additional steps to prevent the use of equipment in its custody and control to smuggle drugs into the United States, Union Pacific said in the court documents.

    Jim Young, U.P. chairman and chief executive officer, has raised the issue with Ferromex's board of directors, the Omaha-based railroad said. The railroad declined Friday to make Young available for an interview.

    The April letter to U.P. also said several hidden-drug cases were similar enough to raise the question: How many more drug-seizure incidents of these types will occur until the railroad effectively addresses the problem?

    The letter said U.P. had been negligent in the 2003 Brownsville case. The agency found mitigating factors and offered to reduce the penalty to $412,800 — 10 percent of the original amount. It often reduces penalties due to mitigating factors.

    In return, it said, it expected U.P. to deal with the recurring problem of drug smuggling on its railcars entering the United States at Calexico, Calif. Of the 42 smuggling cases, 37 were discovered at Calexico. The others were at Nogales, Ariz., and Brownsville.

    The railroad turned down the offer, saying to accept mitigation offers requires giving up its right to appeal a case in court.

    "We have no further recourse," William Lamson, an attorney for the railroad, said Friday. "It would be, in effect, a bar to any further action by us."
    Some people were just dropped on their heads as children more than the rest of us!

  • #2
    Well, I can see Union Pacific's point. They don't take posession until the cars are in the US. I can see the problems they'ld have sending people into Mexico.

    Guess the best alternative is to just cut trade, leave the cars in Mexico if Ferromex can't check them.
    "That's right man, we've got mills here that'll blow that heap of your's right off the road."

    "Beautiful Daughter of the Stars."(it's my home now)

    >>>>> A Time for Choosing <<<<<

    Retired @ 31yr 2mo as of 0000 hrs. 01-01-10. Yeah, all in all, it was good.


    • #3
      This case makes no sense. What can the railroad do about it other than cease all railroad traffic with Mexico?


      • #4
        The only fair thing would be for the UP to pay for the cost of the inspection teams, or pay a private contractor to check their trains at the border (where its safe) and relieve the border agents to do something else.


        • #5
          Originally posted by jb5722
          sounds like another great job for blackwater. i would have no problem if some mexican drug runners got shot up.

          I'd have no prob seeing drug dealers get shot up either.
          Unfortunately, unlike in Iraq, the Mexican gubment and its cheese would be sure to arrest anyone shooting at their decent drug dealing citizens.
          Mexico has proven time and time again that they will arrest any U.S. law enforcement, military, and customs personnel that accidentally wonder too far south or simply are close enough on the U.S. side for them to grab and charge with anything they can.


          • #6
            First hand knowledge.

            I work on the border for UPPD and we get several rail cars from Ferromex every night. Myself and other agents have to physically open the huge doors for the RR bridge crossing the Rio Grande. The trains from MX come in and we "interchange" rail cars that contain many trucks/cars, cement, beer, hazmat, and a number of other commodities that we can't live without. I won't discuss what happens next due to security reasons ,but we work with CBP officers and sometimes a USBP Agent is nearby. Even if we find a load before CBP, UP still gets fined big buck$$$. To tell you the truth, I don't think anything gets through at our POE, and if it does, I don't think it is much. The MX RR does have security officers that escort the trains going into the US but you know how that goes. Obsviously we can't go into MX with any kind of authority and Ferromex could tell us not to go into their rail yards. It is very complicated situation and it seems unfair, but UPRR is doing everything it can to avoid paying the fines.


            • #7
              Originally posted by wirefire2 View Post
              The only fair thing would be for the UP to pay for the cost of the inspection teams, or pay a private contractor to check their trains at the border (where its safe) and relieve the border agents to do something else.

              What border are you talking about, US or MX? USBP is there anyway sitting on X's. CBP has its own Freight RR unit just for the interchanges. So everything is covered on the US side, by the Gov. and by UPRR.

              UPPD Agents are always present for the interchange and we have private security that inspects the rail cars on the US border rail yard.

              And forget about stopping RR traffic with MX, it would hurt the economy tremendously. We (the US) do a lot of trade with MX. We get a lot of money by sending grain and other US products to MX. We also get a lot of chemicals and other hazmat that is needed to produce tons of products in US factories.
              Last edited by ManoloQ; 08-04-2008, 10:27 PM. Reason: add more


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