In the Henry Cuellar Bribery Case, Rendon and Strothe Enter Guilty Pleas

Federal allegations of bribery, money laundering, and acting on behalf of a foreign government are brought against the Laredo Democrat. Recently unsealed court documents reveal that two political consultants have entered a guilty plea to charges of conspiring with U.S. Rep. Henry Cuellar to launder over $200,000 in bribes from a Mexican bank. The documents also indicate that the consultants are assisting the Justice Department in prosecuting the Laredo Democrat.

Henry Cuellar Bribery Case Explained:

Cuellar, a prominent Democrat from South Texas, and his spouse Imelda were charged with receiving over $600,000 in bribes from Azerbaijan and Banco Azteca, a Mexican commercial bank. Cuellar is accused in the indictment, which was made public last week, of receiving payments from the bank in return for persuading the Treasury Department to circumvent an anti-money laundering rule that endangered the bank’s interests. Court documents claim that Cuellar enlisted the help of two consultants, Florencio “Lencho” Rendon and Colin Strother, his former campaign manager, to arrange the payments.

In March, Rendon and Strother reached plea agreements with the Justice Department, whereby they committed to assist the government in its probe of the Cuellar family. They may all spend up to 20 years in jail and pay significant penalties if found guilty of conspiring to launder money.

According to the plea agreements, Cuellar initially requested that Strother meet with Rendon in February 2016 to “participate in a project to test and certify a fuel additive made by a Mexican company… so that it could be sold in the United States.” The San Antonio Express-News was the first publication to report on the plea agreements. According to the plea deals, Rendon promised Strother he would pay him $11,000 monthly for the project, with $10,000 going to Strother’s sister, Imelda Cuellar.

Rendon and Strother Plea Deals:

From March 2016 to June 2019, Strother was paid $261,000 by Rendon, of which the records claim Strother paid more than $236,000 to Imelda Cuellar. According to his plea agreement, Strother concluded that the project was “a sham” since neither Rendon nor Imelda Cuellar “did any legitimate work.” Strother “understood that the true purpose of the payments” was to provide Henry Cuellar with a “funnel money” so the Laredo Democrat wouldn’t have to divulge it in his yearly financial reports.

In a statement he released on Friday, Cuellar proclaimed his innocence and stated his activities were “consistent with the actions of many of my colleagues and in the interest of the American people.” He is accused of working for a foreign government, money laundering, and bribery.

Cuellar has been a member of Congress since 2005, and because of his lengthy service and position on the influential House Appropriations Committee, he possesses significant influence in Washington. Under a House Democratic rule that requires a committee chair to resign if they are charged on a charge that carries a potential sentence of more than two years in prison, he was the ranking Democrat on the subcommittee overseeing financing for homeland security.

Rendon and Strother stipulated in their plea deals that they would testify “before a grand jury or in any other governmental or administrative matter when asked to do so by the United States.” Together with this, everyone committed to handing over “all documents in his ownership or under his control regarding all areas of inquiry and investigation.”

A series of meetings in 2015, allegedly organized by Cuellar, between Rendon and executives of Banco Azteca discussed “U.S. regulatory issues” that were impeding the bank’s efforts to “facilitate remittances,” or “the transfer cash from Mexican workers in the United States to their relatives in Mexico,” as detailed in Rendon’s plea agreement, also sheds light on the beginnings of the alleged bribery scheme.

According to Rendon’s plea documents, shortly afterward, he allegedly signed a contract that would pay him fifteen thousand dollars a month for “strategic consulting and advising services” for an unidentified “U.S.-based media and television company” that shared “common ownership under a Mexican conglomerate” with Banco Azteca.

Following that, according to court documents, Rendon would provide Strother $11,000 of the monthly payments, keeping $4,000 for his own consulting business, with the expectation that Strother would keep $1,000 for himself and transfer the remaining $10,000 to Imelda Cuellar’s business. According to the plea agreement, Rendon and Henry Cuellar supposedly never discussed having Rendon, Strother, or Imelda Cuellar perform any work “about the contract.” This led Rendon to believe that “the contract was a sham” and that it was all a part of a plot to “funnel money” from the bank to Henry Cuellar.

The Justice Department said in Henry Cuellar’s indictment that the Laredo Democrat committed to “advise and pressure” executive branch officials to put procedures in place that would facilitate cross-border transactions essential to Banco Azteca’s operations in exchange for collecting payments.

Additionally, he is accused of providing the bank’s vice chairman with information regarding a measure that would temporarily prevent the Consumer Financial Protection Bureau from enacting new rules about the payday lending sector. According to the indictment, Cuellar then collaborated on the wording of the bill’s defense with a Mexican bank subsidiary situated in the United States. The subsidiary was a provider of payday loans.

According to the indictment, Cuellar and his spouse utilized the bribe funds to pay for dining out, shopping, taxes, credit card bills, auto payments, and a $12,000 bespoke gown. The report said that one of the Cuellars’ grown children had a hand in setting up the fictitious shell businesses used to launder money. Christy and Catie are the Cuellar family’s two adult children.

According to the indictment, the Cuellars allegedly negotiated the deal with Banco Azteca while executing a plan to accept payments from Azerbaijan’s state-run oil and gas company. These payments were allegedly also laundered through fictitious consulting contracts to shell companies that Imelda Cuellar owned.

Henry Cuellar is said to have pressed American policy in favor of oil-rich Azerbaijan. This former Soviet state shares a Caspian Sea border with Russia and Iran in return. According to the indictment, this involved attempting to thwart legislation that was favored by members who backed Armenian interests and inserting wording into defense expenditure legislation to promote relations with nations in the area, especially Azerbaijan.

Nagorno-Karabakh is an enclave inhabited mainly by ethnic Armenians. Until last year, Azerbaijan and Armenia had been embroiled in a long-running border conflict over the area. In 2017, Cuellar worked with Azerbaijani diplomats to revoke laws that would have paid for cleaning land of land mines in Nagorno-Karabakh. The indictment included text exchanges between Cuellar and one of the diplomats.

Cuellar declared that he still intended to run for reelection in November, notwithstanding the announcement of the indictment. Cuellar’s district, which extends from the border to the suburbs of San Antonio, will see a runoff on May 28 to choose the GOP nominee. Rancher Lazaro Garza Jr. and Navy veteran Jay Furman will compete against each other.

In reaction to Cuellar’s indictment, the nonpartisan election predicting website Cook Political Report changed its district assessment from “likely Democratic” to “lean Democratic.” Based on philosophy, Cuellar is often considered the most hardline Democrat in the U.S. House. Despite Beto O’Rourke’s closer victory by five points in the district, Cuellar won return in 2022 by a margin of 13 percentage points.