Herald News (Passaic County, NJ)
BYLINE: By PAUL BRUBAKER
Passaic County, NJ
Granulated sugar spilling from plastic bags in a police evidence room was just one of the things that unraveled what would have been a perfect crime. So obvious was the clumsy replacement table sugar in place of powdery cocaine that investigators soon pieced together what had happened, and who was culpable.
Otherwise, who could have known? Alan Souto, a married father of four, Haledon councilman and veteran sheriff’s officer, and his childhood friend and accomplice, Henry Cortes, also married and notable as manager of junior welterweight champion Kendall Holt, had been living double lives: They have each pleaded guilty to making hundreds of thousands of dollars from stolen cocaine.
By their plan, Souto, in charge of the evidence room at Passaic County Sheriff’s Department headquarters in Wayne, pilfered narcotics that were set to be destroyed, replacing the stolen powder with poorly sealed bags of ordinary sugar.
Cortes would find bulk buyers to purchase the drugs. They figured they’d pocket the cash while authorities destroyed look-alike bags of phony coke put in place of the stolen drugs.
But the granulated sugar that replaced the drugs leaked out of the clumsily resealed bags. Souto’s entrances into the evidence room, which were sometimes during off-hours, were logged by the swipe-card lock. That record, and a record of his calls made on a Sheriff’s Department cellphone from headquarters to Cortes, formed a paper trail that investigators used to piece together a case.
Eventually, the FBI got wind that evidence pertaining to one of its open cases was missing, and Souto reacted by stashing $220,000 made from the drug sales in a duffel bag. That bag was the sole item found in a storage bin along a Clifton highway.
Unlikely suspects Vital to the plan was each man’s ability to keep up appearances. Souto, 40, earned more than $110,000 and was counting his days to retirement on a comfortable pension.
Cortes, 35, of Mahwah, continued to manage boxers, including Paterson native Holt, the reigning junior welterweight champion. He also attended the Port Authority police academy while his fledgling real estate redevelopment project in Haledon was caught in the recession’s undertow.
Cortes pleaded guilty in a federal court on Thursday to his part in the scheme in which he netted $200,000. Two months ago, Souto admitted in the same court that he stole narcotics from the evidence room he supervised, and cleared at least $250,000 in the scheme.
In an accompanying plea agreement, Souto stipulated that he moved more than 90 pounds of drugs out of the evidence room.
Prosecutors said last week it all happened in the last five or six weeks of 2007. “It wasn’t like all 48 kilograms were taken at the same time. He’d go in and he’d take three, he’d take two, or he’d take five,” said Chief Assistant Prosecutor Jay W. McCann, who handles white-collar crime and public corruption cases for the Passaic County Prosecutor’s Office. Although neither man had a criminal history, the crime might have succeeded were it not for mistakes they made.
Scenes of the crime
As Cortes’ attorney, Ronald Fava, said on the steps of the federal courthouse in Newark on Thursday after his client’s plea, “Sometimes, the nicest people do the stupidest things.”
Souto had already taken the oath as a Haledon councilman when he was assigned in September 2006 to oversee the evidence locker at the Sheriff’s Department headquarters in Wayne.
The locker is about the size of two adjoining hotel rooms and houses all kinds of items collected in the course of criminal investigations, including power tools, weapons and global positioning devices, McCann said.
There also were massive quantities of drugs in heat-sealed plastic bags and cataloged according to pertinent cases. Some of the narcotics have been sitting on the locker’s shelves for years as cases muddled through the judicial process, he said.
Souto had worked in the evidence room more than a year before he crossed the line a few days before Thanksgiving 2007. His pattern of theft would continue until a few days after Christmas, McCann said.
Part of Souto’s job was to review what evidence could be burned, based on each case’s status as reported on a computerized database.
One particular case Souto reviewed involved several kilograms of cocaine. All complaints filed by the state had been dismissed, the data indicated, presenting Souto with a perfect opportunity to pilfer narcotics that would never be needed in court. Or so he thought. Souto would later learn the reason the state dismissed the charges was because the federal government had taken over the case. He entered the evidence room using a swipe-card, unaware that a computerized log recorded every entrance. After emptying the narcotics into plastic food storage bags, he filled the evidence bags with common white granulated sugar.
Racing against time and trying to avoid being seen, Souto tried to use a heat-sealer in the evidence room to close the bags again. It wasn’t easy. Sometimes it took two or three attempts.
“I guess because of the time pressure and nervousness, he did not effectively reseal these bags,” McCann said. Meanwhile, a flaw in the sealer made marks that would later prove that the bags, which were originally closed at a state forensics lab, had been opened and resealed in the evidence room.
Having acquired the drugs, Souto called Cortes on a Sheriff’s Department-issued cellphone. The officer told Cortes he was on his way to a dilapidated factory building at 2 John St. in Haledon, which Cortes owned. Under the cover of night, Souto climbed a chain-link fence behind the building to drop the drugs at one of the two designated spots: a locked utility box or a hiding place in a wall behind a cellar door.
Cortes called an intermediary. Later, two drug dealers, well known in the Paterson underworld, picked up the drugs for distribution. “This was a wholesale operation,” said McCann, adding that investigators believe the dealers did not know the source of the cocaine. “They would receive it as a kilo; they would sell it as a kilo.”
The first mistake
One of Souto’s first errors was taking items from the evidence locker, including a GPS unit that was in a car impounded during a prostitution investigation. When it was discovered missing, it triggered an internal affairs investigation that included an inventory of the evidence room. Once the drugs were sold, the same intermediary who contacted the drug dealers brought the proceeds from the sales back to Cortes, said Detective Sgt. Emil Trione of the Prosecutor’s Office white-collar crime unit.
About $220,000 from the drug deals was recovered at Clifton Route 46 Self Storage, where Souto had rented storage space shortly before he was arrested in March 2008. “It was a duffelle bag in the middle of the storage bin,” McCann said. “The only thing in the storage locker was a duffelle bag.”
Trione said that Cortes had laundered his share of the drug-dealing profits through one of his three businesses: Associated Electric in Allendale, Cortes Entertainment, his boxing management firm and John Street Commons LLC, which redeveloped a factory building at 1 John St. in Haledon into 19 luxury condominiums.
Cortes bought the property in May 2005 for $950,000, according to the borough’s tax assessor. The next year, he bought 2 John St. for $1.45 million, with hopes of creating more apartments.
Instead, it became a rendezvous spot where drug dealers stocked up on their inventory. Some have suggested that, after the real estate market took an abysmal downturn, Cortes was desperate to make money to sustain his ill-timed investment.
But people were at a loss to explain what Souto’s motivation may have been. “I think he aspired to do some of the things that Cortes was doing,” said Trione, referring to Cortes’ redevelopment work and involvement in professional boxing.
“More than anything, I think it was just greed.”
McCann said that three more arrests are anticipated within the next six weeks.
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