HAZARDOUS WASTE:

Exec played toxic shell game with mercury-laced soil

Sixth story in an occasional series about EPA's fugitives list.

Of all the alleged crimes committed by members of U.S. EPA's list of wanted fugitives, Raul Chavez-Beltran's misdeeds rank among the most brazen.

Chavez-Beltran, who has been on the run for more than eight years, was president of a hazardous waste disposal service in El Paso, Texas, that failed to dispose of the hazardous waste it was paid to collect.

Instead, Chavez-Beltran and a group of business partners spent the better part of four years playing a haz-mat shell game, getting paid to gather waste from several companies across the border and then locking it away in leased and rented properties in and around El Paso. The group realized that mislabeling the haz-mat material and putting it in storage was a cheaper alternative to properly disposing of it.

And when authorities came asking questions, Chavez-Beltran either found new places to hide his toxic inventory or burned the evidence.

Nov. 24, 1997, was a particularly busy day for Chavez-Beltran's dirty scheme, according to an indictment filed in U.S. District Court in Texas in 2003.

On that day, one of his business partners met with state environmental inspectors to lie about the toxic contents found leaking from a storage drum at a company facility near downtown El Paso, and Chavez-Beltran was busy negotiating another $26,000 deal to "dispose" of some 34,000 pounds of mercury-contaminated soil that he intended to hide at another storage site across town.

The mercury contract began as just another money-making scheme by Chavez Beltran's fraudulent Encon Environmental Services Inc., but, in the end, it proved to be one dirty deal too many.

False lab reports, manifests

Established by Chavez-Beltran and business partner Jesus Audelio Uribe-Franco, Encon Environmental Services Inc. built its business model on a particular requirement of the 1983 La Paz Agreement between the United States and Mexico.

Article 11 of the agreement, which was designed to protect and conserve the environment of the border region of both countries, requires that all hazardous waste generated in Mexico related to products manufactured in Mexico but consumed by the United States must be disposed of in the United States.

Chavez-Beltran, a Mexican national, used his connections in Juarez, Chihuahua, to target companies that hired environmental service contractors to meet that requirement. According to EPA, he drummed up business from Mexican "maquiladoras," or manufacturers that typically assemble parts that have been shipped in from the United States and export the final product back across the border.

To help facilitate their fraud, Chavez-Beltran and Uribe-Franco brought on a local hazardous waste importation expert, Roberto "Bobby" Loya, who eventually became a key partner in the organization.

Despite lacking the proper permits under the U.S. Resource Conservation and Recovery Act to store or dispose of hazardous waste, Encon was able to use false lab reports and shipping manifests to fool U.S. inspectors while they kept Mexico clients in the dark about what happened to their waste.

The scheme worked well, even as the success of the business created an ever-increasing hazard to the El Paso community as the company began stockpiling dangerous substances in properties around the city.

But the scam wasn't completely without incident. According to the indictment, in early June 1996 a waste container collected from a Juarez-based transformer manufacturing company spontaneously ignited "causing substantial property damage and creating an endangerment of imminent serious bodily injury or death to others."

Still, by the time the mercury spill occurred at the Harper-Mex manufacturing facility in 1997, Chavez-Beltran and his business partners were overseeing a growing business. And even though Encon had by that time caught the eye of state regulators after a 55-gallon drum was found to be leaking at one of the company's storage sites about a mile from downtown El Paso, Chavez-Beltran took on the Harper-Mex contract.

As did other Mexican businesses who fell for Chavez-Beltran's scheme, EPA noted in a recent statement about the case that Harper-Mex believed its waste was being handled properly.

"Harper-Mex de S.A. had to show documentation that the waste was imported into the United States for disposal," EPA said in response to questions about the case. "Their documents were in proper order. However, when the waste crossed over into the United States, it was alleged that Beltran and the other defendants removed the hazardous waste labels and created a falsified nonhazardous waste manifest so that they could dispose of the mercury contaminated soil illegally, i.e., more cheaply."

The 34,000 pounds of mercury-contaminated soil was eventually stored in a semi-truck trailer 8 miles from the site that state officials were already focusing on.

The drums sat for about a month when Chavez-Beltran and Uribe-Franco decided to get rid of the evidence by transferring it into 52 drums labeled "non-hazardous petroleum" and shipping it to a New Mexico-based dirt burning service.

The deception put the lives of unsuspecting employees at the dirt-burning plant at risk, the indictment noted, as they set about burning the toxic mercury-soaked soil rather than a simple oil and dirt mixture.

Informant

The scheme might have worked, except the conscious of one unnamed Encon employee got in the way.

According to EPA, an anonymous letter was sent to authorities by someone inside the company alleging that Chavez-Beltran and others were illegally storing hazardous waste in locations throughout El Paso.

By that fall EPA and state authorities were coming down on Encon and the entire scheme began to unravel.

By the beginning of 2000, Encon Environmental Services Inc. was out of business and three years later a federal grand jury issued its indictments.

Of the five men charged in the case, Chavez-Beltran was the only one that fled rather than face justice.

Uribe-Franco eventually pleaded guilty to unlawful storage of hazardous waste related to the mercury-contaminated soil. He was sentenced to 12 months in jail and was subsequently deported to Mexico. Loya pleaded guilty to making a false statement to an EPA special agent and was sentenced to six months in prison, 36 months of probation and a $1,000 fine. Encon's warehouse manager earned a 15-month prison sentence in relation to the mercury incident.

An environmental manager of Harper-Mex was eventually acquitted after a trial.

Several attempts to reach Loya were unsuccessful and his lawyer on the case said last week that he was unsure how to get in touch with him. Uribe-Franco's lawyer in the case also did not return calls.

Chavez-Beltran's last known address was in Juarez. EPA still believes he is living and working in Mexico.