Retired Mexican general arrested in B.C. claims he's the 'fall guy' in gas theft corruption case

The lawyer for a man accused of masterminding organized thefts of fuel from Mexico's state-owned oil and gas monopolywhile he was in charge of its security has told a Vancouver courtroom that the charges against him are completely baseless.

Retired Gen. Eduardo Leon Trauwitz appeared in B.C. Supreme Court on Wednesday for a bail hearing as he awaits extradition proceedings on organized crime and gas theft charges in Mexico. The charges stem from his seven years as head of security for Petroleos Mexicanos, commonly known as Pemex.

According to Ryan Dawodharry, legal counsel for the attorney general of Canada, Trauwitz faces up to 60 years in a Mexican prison for a scheme that allegedly saw him forcing his subordinates to facilitate and cover up illegal taps of Pemex'spipelines by violent criminalorganizations.

Trauwitz was arrested in B.C. on Friday and is asking to be released on bail. His lawyer, Tom Arbogast, argued Wednesday that there is no good reason to keep Trauwitz behind bars.

The retired general has been in Canada for 30 months, has applied for refugee status and has a work permit in Canada, Arbogast said. He has been living with his daughter, who is a graduate student at the University of B.C.

"There is no evidence that he will be a flight risk other than a presumption that someone who is facing criminal charges in Mexico ... is going to flee," Arbogastargued Wednesday.

He claimed that Trauwitz is thevictim of a politically motivated prosecution.

"Mr. Trauwitz's position is that he is being set up as the fall guy due to corrupt practices in Mexico," Arbogast said.

"Mr. Trauwitz is essentially the person who was trying to fix the situation in Mexico, and it was an Alice in Wonderland situation where up is down and black is white."

B.C. Supreme Court Justice Veronica Jackson has reserved her decision on Trauwitz's bail.

Crown argues Trauwitz is a flight risk

The federal government is arguing that Trauwitz does not have strong ties to Canada because he does not own property here, has no family in the country apart from his daughter and despite his work permit, doesn't have a job.

Dawodharry told the court that Trauwitz has a history of failing to appear in courtin Mexico on these charges, and instead flewto Canada one day before a scheduled court date in May 2019.

"We know Mr. Trauwitz fled Mexico before he was required to face charges because the proceedings in his view would be unfair," Dawodharry said.

"If he is subject to a removal order or departure order, there is a risk that he would again abscond."

Arbogast, in turn, described that reasoning as "inconsistent and circular" in light of Trauwitz's refugee claim and allegations that the Mexican charges are illegitimate.

He said Trauwitz intends to "fiercely" fight his extradition.

"It is not a strong case in my opinion. It is thin. The documentation is questionable and the evidence is shifting. There is an open question to be determined whether any of this documentation may meet Canadian standards," Arbogast said.

Dawodharry told the court that the strength of the evidence against Trauwitz is not a question to be decided in a bail hearing, but eyewitnesses who worked directly under him at Pemex are prepared to testify about how they were forced to go along with the fuel theft scheme under threat of losing their jobs.

Gas shortages, fatal explosions linked to fuel thefts

For years, fuel thefts by organized crime groups in Mexico have led to gas shortages and major disasters in several states.

Thieves pump the fuel using dangerous pipeline taps into tanker trucks and sell it to industrial users or sometimes even legitimate Pemex-franchised gas stations.

Between 2016 and 2019, Pemex estimated that the fuel it lost to these gangs was worth more than 146 billion pesos or about $9 billion Cdnin today's currency.

These thefts have also been blamed for pipeline explosions that have killed dozens of people, including a 2019 blast in the state of Hidalgo that took at least 137 lives.

Trauwitz is scheduled to appear in court again Thursday to learn whether he will be granted bail.