Judge sets bond at $750,000 for man accused of buying stolen crude oil

McALLEN, Texas (ValleyCentral) — A judge on Friday set bond at $750,000 for a man accused of buying stolen crude oil from criminal organizations in Mexico.

During a hearing on Friday morning, U.S. Magistrate Judge Ignacio Torteya III set bond at $750,000 for Maxwell Sterling Jensen, 25, of Utah, who co-owned Arroyo Terminals in Rio Hondo.

“Mr. Jensen, you are restricted to your residence at all times,” Torteya said, “except for employment, education, religious services, medical, substance abuse or metal health treatment, attorney visits, court appearances, court-ordered obligations or other activities pre-approved by the U.S. Probation Office or the court.”

Tanker trucks delivered thousands of gallons of crude oil to Arroyo Terminals, which stored the oil in giant tanks near Rio Hondo. Every few weeks, barges would transport the oil to buyers in other parts of Texas.

“The company specializes in domestic and cross-border acquisitions of various blends of Crude Oil,” according to information posted on the Arroyo Terminals website.

A grand jury indicted Maxwell; his father, James Lael Jensen; his mother Kelly Anne Jensen; and his brother, Zachary Golden Jensen, in April.

They’re charged with participating in a conspiracy to launder money linked to fraudulently imported crude oil.

The indictment also charged Maxwell and James with aiding and abetting the smuggling of goods and making false statements.

Details about the conspiracy surfaced in April and May, when members of the Jensen family appeared in court.

“They were entering into agreements with conspirators — unindicted conspirators — to bring mislabeled crude oil from Mexico into the United States,” Assistant U.S. Attorney Michael Hess said during a hearing on April 24 in Utah.

They labeled the crude oil as “waste of lube oils,” according to the indictment, and “petroleum distillates.”

“This is significant mainly because the government of Mexico, through its oil company, PEMEX, will not allow for crude oil to enter into the United States except through very limited agreements with oil and gas companies here in the United States,” Hess said. “So the crude oil that was making its way into the United States was, by necessity, having to be stolen from PEMEX, mislabeled and then delivered into the United States labeled as ‘waste oil.’”

By claiming the crude oil was actually waste oil, they also paid lower taxes and tariffs.

“The individuals that they were working with — and that Mr. James Jensen was aware of — are these Mexican criminal organizations,” Hess said.

Stolen oil is big business for Mexican drug cartels.

“Fuel theft, colloquially referred to in Mexico as huachicol, is the most significant non-drug revenue source for Mexican cartels and other illicit actors,” according to information published by the U.S. Treasury Department.

In Tamaulipas, the Gulf Cartel and the Jalisco New Generation Cartel work together to steal crude oil from PEMEX, according to the Treasury Department, and ship the stolen oil across the border.

“The stolen crude oil is then delivered to complicit U.S. importers in the oil and natural gas industry operating near the U.S. southwest border,” according to the Treasury Department, “who sell it at a steep discount on the U.S. and global energy markets before repatriating the significant illicit profits back to the cartels in Mexico.”

Documents filed in the case against the Jensens don’t provide any details about the people or criminal organizations they allegedly worked with.

Maxwell played a significant role in the scheme, according to Assistant U.S. Attorney Laura Garcia, who discussed the case during a detention hearing on April 29 in Brownsville.

“We do believe that Mr. Maxwell Jensen — him, working on behalf of the Jensen family — had significant ties to Mexico,” Garcia said.

Maxwell also spent time at the family home in the Bahamas, Garcia said, and made six trips to the Bahamas during the past 12 months.

“The family is known to have a bank account in the Bahamas that is outside the reach of the United States,” Garcia said. “So the government does believe that they also have funds outside the country.”

Garcia asked Torteya, the magistrate judge, to hold Maxwell without bond.

Maxwell’s attorney, Robert Louis Guerra of Brownsville, said his client was a hardworking father of five.

“The family needs their father,” Guerra said. “And they need their father to go out there and provide for them.”

Maxwell had already lined up a new job in construction, Guerra said, and would comply with any conditions imposed by the court.

Torteya, the magistrate judge, wasn’t convinced.

“The court finds, at this time, that there are no conditions or combination of conditions that would reasonably assure the presence of this defendant at future court proceedings,” Torteya said. “And I will order him detained pending trial.”

After the hearing, Maxwell’s attorney struck a deal with the government.

They suggested that Torteya set bond at $660,000 with a $66,000 cash deposit.

Maxwell’s grandfather, Gordon D. Walker, who worked at the U.S. Department of Housing and Urban Development during President Ronald Reagan’s administration, agreed to serve as co-surety on the bond.

They also suggested home detention with GPS monitoring.

During a follow-up hearing on Friday morning, Torteya set bond at $750,000 with a $75,000 deposit.

Maxwell is scheduled for a pretrial hearing in June. If convicted on the most serious charge against him, Maxwell faces up to 20 years in federal prison.