Gulf Cartel boss’ son-in-law sentenced to 11 years in prison for extortion, money laundering

McALLEN, Texas (ValleyCentral) — Gulf Cartel boss Osiel Cardenas Guillen’s son-in-law was sentenced to 11 years in federal prison Wednesday.

Carlos Favian Martinez, 39, of Mission participated in a conspiracy to extort transmigrantes, people who export used cars from the United States to Central America. Martinez forced transmigrantes to pay a piso — a tax — for every car that crossed the border.

People who refused to play by Martinez’s rules were kidnapped, beaten and murdered, according to prosecutors. Martinez never admitted to harming anyone or working for the Gulf Cartel.

“A lot of that stuff is inadmissible evidence,” attorney Kent A. Schaffer of Houston, who represented Martinez, said on Wednesday, when his client appeared in court for sentencing. “A lot of it is hearsay, rumors, innuendo and it sounds horrible.”

Martinez married Celia Marlene Cardenas in April 2004, according to marriage records published by the Cameron County Clerk’s Office.

Her father, Osiel Cardenas Guillen, was among the last old-school leaders of the Gulf Cartel. After his arrest, the cartel splintered into factions that waged a bloody war for control of Tamaulipas.

Martinez owned businesses in Mexico, including a casino, and property in Cancun.

His connection with Cardenas Guillen couldn’t protect the businesses from cartel infighting.

In one instance, a faction of the Gulf Cartel cut the casino’s power and refused to turn the lights back on, according to a lawyer who represented Martinez, unless he paid several hundred thousand dollars.

Martinez also controlled Grupo Ceiba, a business that provided services to transmigrantes.

At the time, Mexico required all transmigrantes to use the Free Trade International Bridge in Los Indios.

Before crossing the border, however, transmigrantes had to submit customs paperwork. Only a patente — a customs broker registered with the Mexican government — could process the documents.

Transmigrantes couldn’t just call a patente when they arrived in Los Indios.

The local patentes had exclusive relationships with freight forwarding agents, who provided customs services to transmigrantes. Anyone who wanted a patente to process the paperwork had to pay a forwarding agent.

Competition left the forwarding agents with low margins. In June 2011, four agents decided to fix prices instead.

“The initial group referred to themselves as the ‘Fantastic Four,’ and later, the ‘Fantasticos,’” according to a sentencing memo filed by prosecutors.

They signed a simple, two-page agreement that set standard prices for cars and trucks.

Each business also received a pre-set percentage of the total market for transmigrante services. They called it “The Pool.”

Any business that wanted to provide transmigrante services had to join The Pool, according to documents filed in the case against Martinez. If a business refused, The Pool would stop patentes from working with the rogue business. 

The Pool also had to pay the Gulf Cartel, which controlled the Los Indios bridge. A member of The Pool collected a piso of $40 per transaction for the cartel.

In 2015 or 2016, according to a sentencing memo filed by prosecutors, Martinez joined The Pool and started collecting the piso himself.

“Thereafter, piso prices were increased to $65 per transaction, and in 2019, $80 per transaction,” according to the sentencing memo filed by prosecutors.

From Jan. 1, 2014, to April 5, 2022, according to an indictment filed against Martinez, the government counted about 675,000 transmigrante transactions at the Los Indios bridge.

Based on the number of transactions, the government estimated that transmigrantes paid about $27 million in “extortion fees,” according to the indictment.

“Members of Defendant Martinez’s ‘enforcement group’ worked on the Los Indios bridge,” according to a sentencing memo filed by prosecutors, “and tracked transmigrante forwarding agency transactions to calculate the piso owed by each forwarding agency.”

Martinez also received a percentage of all transmigrante business through his company, Grupo Ceiba.

Data from the U.S. Department of Commerce showed that Grupo Ceiba conducted more than 40,000 transmigrante transactions from Jan. 1, 2017, to Nov. 9, 2022, according to a sentencing memo filed by prosecutors. Charges ranged from $320 to $1,020 per transaction.

After reviewing the data, prosecutors estimated that Grupo Ceiba received more than $14 million.

Exactly how much cash Martinez kept remains unclear.

On paper, Grupo Ceiba was owned by Marco Medina, according to documents filed with the Texas Secretary of State’s Office.

Medina, though, received just one third of the profits, according to a sentencing memo filed by prosecutors. Martinez kept two thirds.

People who refused to join The Pool or pay the piso were beaten, kidnapped and murdered in Mexico.

In 2019, an independent forwarding agent started providing services to transmigrantes. Prosecutors identified the agent by the initials “L.G.”

Someone burned cars that belonged to L.G.’s clients. When she didn’t stop, gunmen shot three of her employees near the international bridge.

All three died, according to the indictment against Martinez. Gumen also shot at L.G.’s brother.

After the shootings, L.G. paid about $89,000 to people affiliated with Martinez. They considered the payments “fines and fees” for operating independently.

“On or about December 17, 2019, a co-conspirator texted to defendant MARTINEZ a picture of the calculation of the fines and fees L.G. owed,” according to the indictment.

The cash he collected in Los Indios allowed Martinez to buy a 17,000-square-foot mansion in Mission, a private jet and more than a dozen luxury cars, including two Range Rovers, according to documents filed by prosecutors.

Martinez sent his daughter to a boarding school in Switzerland, assembled a collection of expensive watches and purchased designer purses for his wife.

Homeland Security Investigations, which is part of U.S. Immigration and Customs Enforcement, arrested Martinez in November 2022. He’d just returned from a trip to Europe, which included stops in Italy and France.

After more than two years in jail, Martinez struck a deal with prosecutors in February 2025.

Martinez pleaded guilty to five charges, including participating in a conspiracy to fix prices, interfering with commerce by extortion and money laundering. He also agreed to pay a $2 million fine and forfeit millions more in property.

Prosecutors, meanwhile, agreed to recommend an 11-year sentence.

Martinez returned to court Wednesday afternoon wearing an olive-green jail uniform. Flanked by his legal team, Martinez accepted responsibility and apologized.

The court broadcast the hearing on Zoom, which allowed victims and other observers in the Rio Grande Valley to watch the sentencing.

U.S. District Judge George C. Hanks Jr. accepted the plea agreement, sentenced Martinez to 11 years and fined him $2 million.

Hanks also recommended that Martinez serve his sentence at the federal prison in Bastrop, which is close to members of Martinez’s family.

“Mr. Martinez, you will need your family to get through the next years of your sentence. Don’t push them away. They’ll be there for you,” Hanks said. “And if you are there for them, then they will be there for you when you’re released.”