Arizona Attorney General Terry Goddard discusses a judge’s dismissal of charges against a Phoenix gun dealer accused of arming Mexican cartels, and other issues concerning his office.
Ted Simons
>> good evening, welcome to "horizon." I'm Ted Simons.
Ted Simons
>> Arizona attorney general Terry Goddard and governor Jan Brewer are at odds over how to proceed in an English learner funding case headed to the supreme court. some people facing foreclosure are being targeted by scammers taking advantage of the situation. and the violence from Mexican drug cartels is spreading north. also, guilty pleas in a $30 million ponzi scheme. those are some of the topics that Arizona attorney general Terry Goddard is here to address tonight on "horizon." good to see you again. thanks for joining us.
Terry Goddard
>> pleasure to be here.
Ted Simons
>> let's start with Mexico. there's so much concern about what's happening down there and it's spreading up north. what's your take on the situation, today?
Terry Goddard
>> today we have a problem and I think that is the ultimate. Arizona has known we've had a problem for years. we've had outbursts of violence, home invasions in Tucson, kidnappings in Phoenix. all of which have connections with the cartels' illegal activities that are basically headquartered in Mexico. but what is new, and I think very exciting, is that the federal government has figured out there's a problem here on the southwest border. and they're throwing some very serious aid in our direction.
Ted Simons
>> talk about that aid. what are we seeing?
Terry Goddard
>> we're seeing a big increase in homeland security forces, border patrol, and other assets. we're seeing the first time, and I think this is really important, first time that they have started watching southbound traffic as well as northbound traffic. you see, the cartels have a business that goes both ways. they're taking cash and guns into Mexico, they're putting drugs and people into the United States. all part of an illegal operation. and we've tended to segment our response. so we go after one or another, we do a pretty good job, but they just double up on the other aspects of their criminal operations. and unfortunately, they're very good at what they do.
Ted Simons
>> and again, this is basically -- drugs in general, but marijuana really is the cash crop here, isn't it?
Terry Goddard
>> it really is there's a lot of misconceptions about marijuana and where it plays in terms of the cartels' strengths. it is 65, maybe 70% of the total revenues of the cartels in Mexico. and because of that, so much of the resources that they have, the violence that they inflict on the country, are coming because of one drug, marijuana.
Ted Simons
>> and now the demand here in America obviously is the reason this is happening. a major reason this is happening. what do we do?
Terry Goddard
>> we're the market.
Ted Simons
>> is prevention an answer? is legalizing marijuana an answer? what do we do?
Terry Goddard
>> I think what really is desperately needed is a practical common sense analysis of the problem and all the potential results. for one thing, we've used suppression and interdiction for years as the sole response to the drug invasion. and that's not working. so what we should do in response to a serious problem is put everything on the table and figure out what else we can do to cut off the cash going to the cartels. and there are a lot of different parts to that problem. we can do a better job of prevention, in my opinion. the Arizona meth project showed in just two years we reduced the demand of methamphetaminesn among high school students. we cut it in half. that's clearly an example that prevention can work and needs to be used more aggressively. treatment. we're still way behind the ball in terms of providing drug addicts with treatment. and frankly, they're a big part of the demand. so let's attack that. legalization has been talked about. I'm not a supporter. but I do think we should take the emotion away from it that tends to surround that discussion, and talk about how do we -- do we create a bigger problem if we legalize marijuana? I think we might. so let's talk about all the ramifications. how can we control it if we make it legal or partially legal if we make it subject to a prescription, there are lots of different ways to handle this problem. it shouldn't just be a group of people screaming at each other. it needs to be talked about in all of its law enforcement and every other potential.
Ted Simons
>> I know another major factor is a gun running, gun smuggling down South. I know there was a case involving a Phoenix gun dealer that didn't make it. what happened there? what was that all about?
Terry Goddard
>> we're repealing -- repealing that decision, because we think errors were made in the trial court. the bottom line, yes, there have been so-called straw buyers who fill out the federal forms, but do it knowing that it's false. they don't intend to own that arm, that gun. they intend for somebody else to take it. and they know, at least in this case they knew it was headed to the cartels in Mexico. I think that's a very serious violation, and we continue to be aggressive in this area, we're looking for other partners to help make sure that folks are not buying -- not lying for the other guy, as the foundation says. that is a felony crime in the federal statute, I believe it is in Arizona as well.
Ted Simons
>> was the fact there was a differentiation in federal and state law --
Terry Goddard
>> that made it confusing, yes.
Ted Simons
>> as far as just general trade with Mexico, how much is that being affected by the violence down there? and creeping North?
Terry Goddard
>> there's no question that spring break was way down in terms of college students and other tourists going to Mexico. this is a huge part of their economy. so the they're economically suffering, as is the united states from the trade that we prosper from that comes north from Mexico. so the violence is real, but it is in particular areas. obviously you don't want to go to Juarez, and you should be careful in Tijuana. but other parts of Mexico are relatively safe. I think people overstate the idea that Mexico is in violence. Mexico is in a war with cartels. the president of Mexico should be applauded in this country because he has taken essentially the tiger by the tail, the bear by the throat or whatever the right analogy is, and he is shaking it. that has caused the disruption, which has resulted in very serious violence that continues this year, and I'm very concerned that unless the U.S. is much more aggressive as we're beginning to be, that violence will come much more into this country.
Ted Simons
>> let's talk about what seems to be a difference of opinion between you and the governor regarding the English learners case and arguing before the supreme court. she wants to you file a brief, and you apparently aren't going to do it. why?
Terry Goddard
>> well, I'm elected by the people of Arizona to be the state's lawyer, to be the advocate in court and to make decisions about legal policy. I guess that's the fundamental issue. and I don't work for the governor. I'm independently elected. she has her own lawyer, and so if she wants to protect a particular position in court, that certainly is her option. but I take my very best decision as to what our appropriate legal policy is. and this one, it wasn't hard. we've been doing the same position ever since the statute in question was passed. and it's very serious that the statute, I believe, and what I argue in briefs, I won't be there personally arguing, but in the briefs before the supreme court, we point out that this statute, if it's effective in Arizona, appears to violate federal law. and the consequences for violating federal law are over $600 million in withheld federal money from Arizona's education system. and I can't in good conscience go along with something that would have that serious an impact in our state.
Ted Simons
>> when she says as attorney general you're supposed to defend the state, you would say --
Terry Goddard
>> I am. I am. I am defending the state. I'm defending the state's budget, something I thought we had in common with the governor. so that's -- that's a difference of opinion, but I respect her position. I submitted our brief over a week before it was due to the governor's office, as I've done with the previous governor, to see if they had any suggestions, if they had any positive critiques that would help us sharpen our argument. I got no response.
Ted Simons
>> do you take seriously the effort, I note treasurer is doing this again this year, the idea of having that representation taken away from the attorney general's office, if it in some way disagrees with the public official? this could be at play with the governor here as well. legislation to that end, talk about that.
Terry Goddard
>> it seems like everybody wants their own lawyer. their own person, mouthpiece in the words of the movies. it happens all across the country. this is no surprise. there's been many attempts by other agencies to get somebody to represent them. Arizona I think very commendable, most states, have legal representation concentrated in the attorney general's office. the reason is simple -- you don't want state agencies suing each other. you need to speak with one voice in court. especially in criminal actions. you need to make sure on appeals from major felony cases that you maximize your impact and you pick your fights in the most strategic way. that's what we do.
Ted Simons
>> so speak with one voice, not necessarily one office holder's voice.
Terry Goddard
>> that's true. if the constitution wanted us all to work for the governor they would have said so. but they set up independent -- individual constitutional offices. the attorney general, the superintendent of public instruction, the state treasurer, state mine inspector. the governor doesn't tell the mine inspector what mines to put the tires in or the treasurer how state money should be invested. the same applies to the attorney general. I'm the chief's legal officer for the state of Arizona.
Ted Simons
>> ok. I know a big ponzi scheme, a couple minutes left here, a big ponzi scheme, another ponzi scheme, talk to use about that.
Terry Goddard
>> another. that's the sad part. here in tough economic times, we found many of these schemes. this one was very common with others that you've heard about. somebody guaranteed that this security investment would bring a 36% return. in this case I thought the person's name would have given his victims a clue. it was Villain. he took over $25 million from unsuspecting Arizonans, thinking they were investing money in a no-lose proposition. and I guess if people hearing this will want to have -- the key is to avoid these ponzis, it seems like it's an astonishingly high interest rate and it's guaranteed, whether it's Bernard Madoff or Mr. Villain in Arizona, they seem to have a common denominator -- you can't lose, we guarantee the return. those shed be red flags to anybody thinking to invest.
Ted Simons
>> what red flags do you look at besides those? was this guy licensed?
Terry Goddard
>> oh, no. he was not a securities dealer in the state of Arizona. he must have been an incredibly fast talker. even after the cease and desist order was issued, he formed another company and sold another $5 million in securities, or bogus securities. this is something that unfortunately is alive in the land and I guess bad economic times make fraud artists even more viable, because people are desperate. they want to believe that they can get an answer to their financial problems, and these guys are all too happy to provide that answer, although unfortunately it's an illusory answer.
Ted Simons
>> with that I want to wrap it up with the idea of mortgage scams out there.
Terry Goddard
>> same scheme.
Ted Simons
>> same business going on there. are we seeing more of it?
Terry Goddard
>> oh, yes.
Ted Simons
>> are you able to prosecute more?
Terry Goddard
>> we've had a disturbing number we're prosecuting, and I'm sure there's much more out there. anybody that has heard about somebody who calls up and says, "I guaranteed I can lower your mortgage rate," again, they can't guarantee it, so that's one danger sign. but the second part is, people are so desperate, if they're one or two payments behind, they want relief. they want to hear from somebody that they're going to give them a key to the federal money that's supposedly flowing so freely. and we found and prosecuted quite a number of people, including some just this month, that are guaranteeing, promising, I'm the guy that can stand between you and your lender and I will get your mortgage lowered. well, you don't need somebody standing between you and the lender. one of the beauties I think of the federal program is it says to the lenders, you need to talk to the homeowners that are in trouble, and you need to try to work this out. and so the best advocate is the homeowner themselves. they don't need a middle man, or a voice on their behalf. this program is meant for them to talk to their lender, and I hope that's what they'll do.
Ted Simons
>> very good. thank you so much for joining us. we appreciate it.
Terry Goddard
>> thank you.
Terry Goddard:Arizona Attorney General;
