The knock on the door at Alexander Blarek and Frank Pellecchia’s home came at 7:30 in the morning. Inside, the two men were just awaking in their upstairs bedroom, where picture windows framed the spectacular backdrop of San Francisco’s Golden Gate Bridge. For sixteen years, Blarek, 56, and Pellecchia, 49, had been lovers and partners in a thriving interior-design business. Success seemed to roll at them, like the swells of the Pacific, in great waves of cash. They owned an Italianate villa just five doors away from the home of actor Robin Williams in the elite Sea Cliff neighborhood, where the tree-lined streets wind along the cliffs above San Francisco Bay. Their home was a portfolio of their professional taste: the Biedermeier secretary table on the Bakhtiari rug, a Botero perched near a baby grand piano. In the garage shone their prize possessions – three top-of-the-line Harley Davidsons, parked alongside their 1985 Mercedes. To their millionaire neighbors, Blarek and Pellecchia seemed like a couple of nice guys, generous and community-spirited.
But last June, there was the knock on the door. As Pellecchia threw on a pair of jeans and went out, shirtless, to answer, he had no idea that an indictment issued by a U.S. Attorney in Brooklyn was about to shatter the world that he and his partner had so assiduously created.
A San Francisco police officer ordered Pellecchia to step outside: “There’s been a robbery in the neighborhood, and we’d like to ask you a few questions.” he said. Pellecchia walked through the garage, and straight into a police trap: a swat team of six DEA agents and a squad of 30 other agents from the SFPD, the IRS, Customs, and even the local Marine unit were arrayed just beyond the gate. The normally quiet street outside was packed with more than a dozen police cars, vans, and unmarked vehicles, all there for him and for Blarek. Within seconds, Pellecchia was handcuffed and pushed inside a patrol car. He watched as the DEA agents, wielding pistols and shotguns and wearing bulletproof vests, stormed into their home and found Blarek in his bathrobe in the kitchen.
Blarek was ordered to get on his knees, handcuffed, and taken outside to another police cruiser. First Pellecchia, then Blarek was brought back into the house to change into street clothes. Local television-news cameras were soon swarming the scene. Inside, a search team tore the place apart with the help of a drug-sniffing dog. They found no narcotics and not a single weapon but thousands of dollars in cash, and the keys to many safe-deposit boxes.
By three that afternoon, the shell-shocked interior decorators would find themselves in a San Francisco courtroom being booked for money laundering. They were, according to a 29-page indictment issued by the Federal Grand Jury for the Eastern District in New York, the personal decorators for one of Colombia’s most notorious drug lords. From 1979 to 1996, Blarek and Pellecchia’s main client was the now-deceased José Santacruz Londoño, one of three men who ran the Cali cartel, which once supplied 80 percent of the cocaine coming into the United States. Their interior-design business was accused of laundering more than $10 million worth of drug profits – money generated by Santacruz’s U.S. cocaine sales.
Suddenly Blarek and Pellecchia, without a misdemeanor between them, found themselves accused of collusion with Colombian drug traffickers. The government – in a nearly unprecedented interpretation of money-laundering statutes – is arguing that the two men are guilty simply for spending a drug dealer’s money.
Two characters less likely to be in league with a drug lord could not have been invented. The Brooklyn-bred Pellecchia is the more gregarious of the couple: Friendly and loquacious, with short-cropped black hair and a bushy moustache, he seems like a genial maître d’ at a fine Italian restaurant. The blue-eyed, rugged Blarek (he sometimes goes by the name Anthony Alexander II) is more reticent. Friends say both men are real-estate and antiques junkies – but that’s about as far as their addictions go. Neither of them drinks or smokes. Their idea of pleasure is making periodic expeditions on their Harleys up the Pacific coast, and they occasionally frequented gay motorcycle bars in San Francisco. No more. Both men were detained for five weeks in solitary confinement – “for their own protection” – at the Alameda Detention Center, then confined for another three weeks at the Metropolitan Corrections Center in Brooklyn until finally being released on $11 million bail in mid-August. Their trial, which opens on February 2 in Brooklyn Federal Court, puts Blarek and Pellecchia at the center of a case in which the brutal Colombian drug trade intersects with the rarefied world of interior design.
“These two men were collecting hundreds of thousands of dollars at a time in drug cash from Santacruz Londoño,” says Mark W. Lerner, a 35-year-old assistant U.S. attorney in Brooklyn who is trying the case with another young prosecutor, Richard Weber. “They then transformed that money into material wealth in a manner which concealed the source of that money. That’s money laundering.”
The defense admits that Blarek and Pellecchia spent millions of Santacruz’s money. But is that illegal? “They were not ‘money launderers,’” asserts Jason Solotaroff, Blarek’s attorney. “They were ‘money-users.’”
The defense will argue that Blarek and Pellecchia – like car dealers or real-estate agents or stereo salesmen – provided a service and were little more than hired hands for Santacruz. “What’s next?” demanded Pellecchia’s attorney, Paul Shechtman, at a bail hearing last summer. “are you going to prosecute John Gotti’s tailor?”
The investigation into Santacruz’s New York drug enterprise began in the late seventies at the DEA’s office in New York City and has involved more than 100 agents who call themselves the “Chepe chasers,” in reference to Santacruz’s nickname. Working closely with the NYPD and with Lerner and his colleagues in the Brooklyn D.A.’s office, the “chasers” have succeeded in convicting dozens of Santacruz operatives in New York over the past decade. In 1996, Santacruz was killed by Colombian police in Medellín after escaping from prison. Unable to prosecute him or any other of the surviving leaders of the Cali cartel, who are protected by Colombia’s non-extradition laws, New York law enforcement has gone after anyone who helped the operation domestically. Last year, Lerner obtained guilty pleas from two Colombians, Franklin Jurado and Edgar García, who laundered $64 million of Santacruz’s money through banks and front companies in Europe and Panama. Now it’s on to his interior decorators; the charges carry a prison sentence of up to 40 years for both Blarek and Pellecchia.
On the day of their arrest, the two men were transformed from millionaires into virtual paupers: the government seized or restrained the contents of two safe-deposit boxes containing $665,400 and $90,100 in small bills, accounts with Dean Witter totaling $1.4 million, and the bank account Pellecchia shared with his elderly mother, whom he helped support. Back at their home in Sea Cliff, a DEA team catalogued an assortment of 50 objets d’art valued altogether at more than $300,000, along with the $10,000 Biedermeier table, the sculptures, the three Harleys, the Mercedes, a parcel of land in Easthampton, and their flagship home in Sea Cliff: in all, approximately $6.4 million was seized or restrained by the government that day under drug-seizure laws. While the men continue to live in their home, they are legally prevented from selling or altering it. If they are convicted, the property reverts automatically to the government.
The three charges of money-laundering conspiracy now hanging over Blarek and Pellecchia are based on two components of the RICO statute. Prosecutors allege that the two men walked into their accountant’s office with millions of dollars in cash and left with checks for the same amount drawn on his personal account. Last October, the accountant pleaded guilty to money-laundering charges in Miami, and is expected to testify against his former clients. The second component of the prosecution’s case hinges on a rarely used statute that makes it illegal to “engage in monetary transactions in criminally derived property.” Under this provision, it is essentially the money – from drug sales or other criminal acts – that is illegal; those who knowingly reap the proceeds are thus considered accomplices to the crime.
Under RICO, the prosecution will have to prove that Blarek and Pellecchia’s design business not only provided Santacruz with innumerable and luxurious comforts but was also – as Lerner alleges – “an integral part of the drug lord’s conspiracy, whose goal was to profit from narcotics sales in the United States.”
While New Yorkers were rolling up tens and twenties to sample his product, Blarek and Pellecchia designed at least ten major projects for Santacruz back in Cali, including homes for him and his wife and various mistresses, a country ranch house, and offices for his legion of front companies – fulfilling the tastes of a man considered responsible for some of the most extreme examples of “narcotecture,” the grandiose style for which the flamboyant, nouveau riche drug lords are renowned.
The decorators did much of their shopping in New York City, where they owned an apartment on West 23rd Street. A Miami shipping agent was hired by Santacruz to transport the purchased goods from New York to Colombia. According to prosecution records, the couple’s purchases for the drug lord ranged from the quotidian to the extravagant: from $100,000 in purchases from Bed, Bath & Beyond to $55,000 in expenditures at Lorin Marsh Ltd., the exclusive customized-furniture outlet that makes reproductions of French art deco, Venetian, Louis XIV, Edwardian, and other classics of the furniture trade. There were also $60,000 in purchases from Milari Furnishings and numerous supplies from EuroTec, in Queens, which sells brass kitchen and bathroom fixtures.
Blarek and Pellecchia’s design work allegedly had a dual purpose: transforming Santacruz’s drug profits into physical objects whose financial origins would be much more difficult to trace than cash, and fulfilling Santacruz’s tastes for expensive home décor. “Santacruz could not spend a dime where the goods he coveted lay: the United States,” wrote Lerner in a government motion filed last summer. “Shackled by notoriety, forced to hide behind a curtain of corruption in his native Colombia, Santacruz recruited willing shills like Blarek and Pellecchia to gather the garish booty for which his ‘traficante’ appetite hungered.”
Blarek and Pellecchia’s attorneys – being paid now after Judge Jack Weinstein released $300,000 to cover living, medical, and legal expenses for the duo – are a colorful cast themselves. Solotaroff was a Legal Aid attorney who achieved a 75 percent acquittal rate before he went private last year. In 1991, he and Lerner shared an occasional lunch while they were both clerking with judges in the Eastern District. Paul Shechtman, a partner with Stillman & Friedman, has fought on both sides of the drug war: a former prosecutor and chief of the Criminal Division for the Southern District, he worked until last year as a criminal-justice adviser to Governor George Pataki. He was also Solotaroff’s law professor at Columbia; now in private practice, he represents largely white-collar cases. Most recently, Shechtman represented Rabbi Bernard Grunfeld, who pleaded guilty in December to improper financial structuring in relation to a drug-money-laundering operation run out of Mesivta Eitz Chaim, a yeshiva in Borough Park.
Blarek and Pellecchia admit that millions of Santacruz’s dollars passed into their hands. But both men maintain they did nothing to conceal the fact that they were receiving large sums from Santacruz – whom they usually charged a standard 30 percent commission. They spent the money openly and used their own names, and the names of their companies: Blarek Designs and A. Alexander & Co. More important, says Solo- taroff, they did not launder anything, in the sense that one brings dirty clothes to the cleaners to get cleaned. “These guys weren’t going out and buying a hundred refrigerators, then turning them around for a profit,” Solotaroff argues. “Laundering money means changing hot money into something else that then can be sold to clean it. That is not what these men were doing.”
The case against Blarek and Pellecchia is unorthodox. The Jurado-García case successfully prosecuted by Mark Lerner last year was a far more traditional example of money laundering: the two Colombians used false names and front companies to funnel money back to Santacruz under false pretenses – thereby transforming “dirty” drug money into “clean” money.
The principals in the Grunfeld case came up with an even simpler scheme: they transformed $1.7 million in small bills into checks drawn on Mesivta Eitz Chaim’s account, and sent the checks back to businesses controlled by a Colombian trafficker. By contrast, nothing Blarek or Pellecchia purchased for Santacruz was ever resold. Nor was the drug money they received ever sent back to Santacruz in Colombia; rather, it was transferred to Blarek and Pellecchia in the United States. “Here you’ve got two people receiving money from overseas to perform a service: working on furniture and carpets,” argues Shechtman.
“I’ll grant you, they had bad taste in clients,” he continues. “But the prosecution is trying to go down a new path with a giant leap. They are taking what was a service relationship and painting it as part of some broad conspiracy. That will fail. Most money launderers are encouraged to spend as much money as possible. We will demonstrate that Santacruz wanted them to spend as little money as possible.”
Civil libertarians and advocates of drug-law reform assert that if the two men are convicted, anyone who receives any money from a drug dealer for any reason could be prosecuted for money laundering. “Through the warped glasses of the drug war, suddenly, normal business transactions have become money laundering,” said Kevin Zeese, president of Common Sense for Drug Policy in Washington, D.C.
Jason Solotaroff also questions the prosecution’s motive for bringing the case, claiming that they’ve gone after his clients partly to gain access to their riches. There is no question that the Eastern District stands to benefit if the two men are found guilty: at a time when all law-enforcement agencies are under increasing pressure from the Justice Department to increase their seizures to supplement tightening budgets, a significant percentage of Blarek and Pellecchia’s $6.4 million in forfeited assets would go to finance the district’s own law-enforcement activities. The prosecution, not unexpectedly, scoffs at this assertion.
One matter not under dispute is that Santacruz ran one of the most successful drug enterprises in New York history. “Santacruz Londoño,” according to DEA Intelligence Analyst Kenneth Robinson, a former NYPD detective and a twenty-year veteran of the Chepe chasers, “was without a doubt the largest distributor of cocaine in the New York area.”
According to the DEA, throughout the late eighties and early nineties, Santacruz was responsible for exporting as much as 800,000 grams of cocaine a week into New York, where it was stored and distributed through a network of safe houses in Queens and Brooklyn. Santacruz’s cocaine empire was vertically integrated: he and another faction of the Cali cartel controlled production, processing, distribution, and sales. Retail hubs were centered in Miami, Houston, Los Angeles, and New York. Santacruz himself displayed quite an affinity for New York City; until 1992, he maintained an $8,365-a-month apartment on West 57th Street.
Though the Cali cartel was far more businesslike than its brutal Medellín counterpart, Santacruz was not above resorting to murder when necessary. In 1992, he ordered the execution of the New York-based journalist Manuel de Dios Unanue as retribution for a series of groundbreaking reports in El Diario about Colombian drug operations. Unanue was shot in a Jackson Heights restaurant that year after Santacruz put a $50,000 price on his head.
Colombian police also consider Santacruz responsible for the explosive violence associated with the Cali cartel’s attacks on the Medellín cartel as the two drug organizations fought over territory. That war extended into the lucrative New York market and was one of the underlying reasons for much of the drug-related violence in this city in the late eighties and early nineties.
If Blarek and Pellecchia were laundering money for Santacruz, they were a puny part of his operation. In 1988, at the height of their alleged conspiracy, the DEA busted a Santacruz employee, Luis Ramos, at a safe house in Queens, where they confiscated $7.8 million in cash; later that month, another Santacruz courier was found in possession of 2,000 kilograms of cocaine and $2.2 million in drug proceeds. Overall, the DEA claims that the cartel shipped billions of dollars in drug profits back to Colombia; Santacruz himself was reportedly worth a quarter of a billion dollars when he was shot.
In Colombia, Santacruz plowed his profits into legitimate businesses. The drug lord fancied himself a real-estate mogul: he owned hundreds of homes, apartment buildings, and office complexes in and around Cali, as well as a huge cattle ranch and restaurants, lending a veneer of legitimacy to his enterprise and generating millions of dollars in non-drug-related income.
It was a visit to one of those homes, back in 1979, that originally brought Alexander Blarek to the attention of Santacruz. Blarek, who ran his own interior-design business in Miami, had been invited for a social visit to the wealthy Ciudad Jardim neighborhood in Cali by a friend who had family in Colombia. He noticed a home being constructed nearby and paid a visit to the site, where he struck up a conversation with the guard overseeing the property. Shortly afterward, the guard introduced him to Santacruz’s wife, Amparo Castro Meza Londoño. Such chance meetings were not inconceivable back in the heady days when dealers and their families lived openly inside Colombia. A photo of Señora Santacruz obtained by the Colombian Security Service shows an elegantly dressed and ample woman in her mid-50s who looks exactly like what she was – a wealthy housewife. Amparo introduced Blarek to her husband, who promptly hired him for his next project: a 30,000-square-foot mansion on the outskirts of Cali.
Blarek was clearly pleased with his new client. “Made the connection. Fantastico!,” he allegedly wrote in his diary – confiscated from his house – days after meeting Amparo. Soon afterward, he began taking Spanish lessons. A portfolio of Blarek’s work from the late seventies presaged his later narcotecture endeavors: very busy interiors, bright colors, shag rugs, and a plenitude of small statues and wall hangings.
Whether he knew that his new client was a drug dealer will be a major issue at the trial. Jason Solotaroff claims that a visitor encountering Santacruz would have many reasons to think that his vast wealth was not necessarily based on cocaine but derived from any number of his businesses: meat, the food trade, home building. Even if Blarek did know, back in 1979 simple knowledge wasn’t illegal. It was only in 1986, when Ronald Reagan let loose the artillery of the drug war – mandatory sentences, asset-forfeiture laws, and new rules governing money laundering – that doing business with a drug dealer became illegal. By 1991, however, the nature of Santacruz’s business couldn’t have been a mystery: Inside Blarek’s scrapbook, confiscated by the government, was a Time cover story on the Cali cartel, with a cover picture of Santacruz Londoño.
Blarek had met Pellecchia in Coconut Grove in 1982. In time, the two became lovers and went into business together. Blarek, a licensed member of the American Society of Interior Designers, is the more visionary partner – hand him a blueprint and he can dream up a suitable décor. He sketches out designs for exteriors as well as interiors, planning everything from construction materials to the artwork. Pellecchia, a skilled carpenter who speaks fluent Spanish, is the hands-on partner who deals with contractors and knows his way around the electricity and the plumbing. By 1986, say prosecutors, Blarek and Pellecchia gave up virtually all their other clients in the Miami area and went to work full-time for Santacruz.
The DEA had long been aware of the decorators’ Colombian connections. In 1982 and then again in 1995, narcotics agents interviewed Blarek about Santacruz and advised him to cut off all contact, which the government alleges he did not do. “We had confidential informants telling us they were still working together,” Robinson says. By 1995, the DEA had determined that the couple’s decorating activities were worthy of intensive surveillance; a team of agents began scouring the men’s trash behind their Sea Cliff home, where they found a trove of coded invoices for Santacruz projects, receipts from items they had purchased, and cryptic references to their communications with the drug lord. “We didn’t have to go through any foodstuffs,” quips Lerner, who personally searched through much of the refuse. “They were good citizens: they recycled everything.”
One of their most spectacular projects was a Santacruz mansion on the outskirts of Cali known as Casa Blanca, which was a replica of the American White House – an audacious touch of political theater in a country renowned for its magic realism.
Though the $18 million project was only partially completed, blueprints obtained by New York feature a classic half-crescent portico, Grecian pillars out front, and vaulted ceilings. Inside, there’s space for a three-person hair salon. Among the objects the decorators allegedly ordered for the Casa Blanca were $300,000 worth of Italian tiles for the swimming pool and a 22-foot dining-room table and eighteen chairs purchased from Lorin Marsh for $100,000. Colombian authorities, who now administer the Casa Blanca, described its design as “the most ostentatious of the eccentricities confiscated from the drug ringleaders.”
Lerner claims that tape-recorded transcripts prove that the two men were fully cognizant of the nature of santacruz’s business. But though the cocaine kingpin provided them with plenty of work, they had to forego the professional recognition that is normally accorded successful designers. Only one article about either man has appeared in the trades – on the cover of Florida Designers Quarterly, in 1981. Entitled “Hilltop Oasis,” it features a project that Blarek designed for Santacruz in Cali (though the client is not identified), displaying three pages of photographs of a comfortable retreat with tropical hardwood furnishings and a fountain coursing its way through the living room and splashing into an outdoor garden.
They may have been denied the recognition of their peers, but the decorators were certainly well compensated in other ways. There were frequent trips to Cali for consultations and expense-paid shopping trips to Europe. Payments were allegedly made cloak-and-dagger style: the prosecution cites numerous trips to New York, Miami, and Los Angeles, where Blarek and Pellecchia are said to have picked up duffel bags filled with as much as $500,000 in cash. Millions more were allegedly wired into their accounts from banks in Europe, Panama, and the United States. Since Santacruz was not free to hold bank accounts in his own name, all of the money was transferred through intermediaries.
Blarek and Pellecchia were living out a decorator’s dream, and it showed in their discreetly indulgent lifestyle back home. They moved to the Bay Area in 1988 and bought their Sea Cliff home for $1.4 million in cash in 1995; in two years, they transformed it into an immaculate villa, now worth an estimated $3 million. The ochre-colored stone wall surrounding their garden and blue-and-white checkerboard tiles lining the windows suggest a pocket of Venice; via vecchia is inscribed in tile alongside the ornately carved wrought-iron gate.
On the advice of their lawyers, neither man would talk for this article. But their neighbors in San Francisco paint a picture of a devoted and generous couple. Their Sea Cliff place was described by one friend as “a contemporary version of a Masterpiece Theatre set.”
Pellecchia was diagnosed with HIV in 1985. Since then, he has remained healthy on a regimented diet of high-protein foods, fresh vegetables, megavitamins, and the emotional support of his partner, according to Pellecchia’s doctor, who submitted a testimonial at their bail hearing. Pellecchia regularly attends an HIV support group, and Blarek has long participated in a counseling group for those with infected partners.
Prosecutors, who believe that Blarek was the prime mover in business dealings with Santacruz, allegedly tried to pit the two men against each other, without success. The time the couple spent in prison was the longest they’d spent apart over the past decade. Pellecchia, unable to sustain his anti-HIV regimen, saw his t cells plummet. Last August, after a federal judge released them on an $11 million bond, the two men returned to San Francisco, where they are now preparing for their trial in Brooklyn.
The anti-narcotics-police compound in Cali is located on the edge of the city in a former hacienda. A sprawling ranch-style home with half a dozen bedrooms, it’s now the gathering place for a legion of undercover operatives. Forty-five agents live here in barracks spread throughout the estate, which offers high-security protection from the hostile world outside, where the drug economy once provided employment to 40 percent of the city’s residents.
A Jeep Cherokee, a Mazda, and a couple of Chevys are parked in a nearby lot, all confiscated during recent drug busts. Since last December, when the Colombian parliament passed a law permitting the seizure of drug dealers’ assets, agents have been conducting daily raids on properties suspected of having been purchased with drug money – much of Blarek and Pellecchia’s handiwork is now in the hands of the Colombian government.
An agent, who identifies himself simply as “Capitán Luis,” slips a pistol under his knee on the driver’s seat of a Mazda, where three weeks before, ten pounds of cocaine were discovered secreted inside the chassis. We embark on our tour of Ciudad Jardim, the richest district in Cali, a calm and airy refuge from the bustling city of 2 million people in a valley of the Andes Mountains. It feels like a mountain version of Easthampton: No home is smaller than a mansion and BMWs cruise the tree-lined streets. Santacruz lived here, and his wife and mistresses still control numerous homes in the city, as do many lesser figures of the Cali cartel.
“Santacruz owned half of this city,” says Capitán Luis, adjusting the pistol under his leg. We cruise slowly past a string of mansions hidden behind stone walls and tall hedges. The agent points out the plush residences that once housed the titans of the Cali cartel: “There’s Rodríguez Orejuela’s place… . There’s his brother Gilberto’s… . There’s Ivan” – a Cali enforcer who erected a life-size bronze statue of himself in his garden.
He stops for a moment alongside a fence and a thick row of trees. “And there’s a place of Santacruz.” Through the trees on a square block rises a white, modernist construction with elegantly curved walls and a domed roof, known as the Café Colombia. Santacruz had this home built in the early eighties as a replica of an elite social club by the same name that once refused him membership – driven by the same defiant impulse that motivated him to build the White House-inspired Casa Blanca.
Luis spent years trailing Santacruz and is still part of the team tracking down his wealth; he finds it amusing to encounter someone on the trail of the drug lord’s decorators. “Very ostentatious,” he says. There are marble hot tubs and gold faucets in the massive bathrooms, suntan chambers, statues of naked women, frilly draperies, porcelain collections, glittering chandeliers, and grand pianos that leading musicians were sometimes hired to play. “They lived like French royalty.”
Aside from the single magazine article and the vast inventories compiled by Colombian narcs, the only documentation of the design team’s work for Santacruz is contained in a twenty-minute videotape made by Pellecchia of a country home the two men designed for Santacruz and Amparo in 1992. Camera in hand, Pellecchia silently tours the more than a dozen rooms, which appear to be alternately tasteful and garish. A sitting room is decorated with a jungle mural colored in splashy brown. Leather couches frame glass tables, massive chandeliers hang from the roof.
Brightly woven rugs – designed by Blarek – cover the wood floors. French posters for the Folies Bergère and the original Lolita film hang framed in one of the bedrooms. Ornate sculptures, glassware, and porcelain figurines abound. Outside, the camera pans a pleasant garden with tropical plants and a fountain bubbling along the rocks.
That home and the possessions inside it, like many other Santacruz properties, will soon be sold by the Colombian government to help finance the army and the police. If Blarek and Pellecchia are convicted, they lose everything they accumulated in the U.S.; if not, the government is likely to pursue a civil suit claiming that their possessions were purchased with drug money. In the end, the decorators for Santacruz may well find themselves de facto decorators for the American and Colombian governments.