Sister-in-Law Implicates Defendant in Money-Laundering Trial : Court: The key prosecution witness says Otoniel Urrego closely monitored cash shipments to her Simi Valley home.

The key prosecution witness in the biggest money-laundering trial in Ventura County history testified Tuesday that defendant Otoniel Urrego was closely involved in the drug-money operation.

Through phone calls and coded facsimile transmissions from his home in Florida, Urrego monitored the money-laundering operation based in a Simi Valley office, according to the testimony of Luz Urrego, his sister-in-law.

And, she testified, Otoniel Urrego once told her that if she was ever arrested, she should remain silent and he would take care of her.

After she was arrested in 1989--when investigators seized $1.5 million in suspected drug money at her Simi Valley house--it was Otoniel Urrego who picked her up when she was released from Ventura County Jail because of insufficient evidence, Luz Urrego testified.

She was arrested again in March, 1992, along with 64-year-old Otoniel Urrego, on an indictment charging them with cocaine trafficking and money laundering. Luz Urrego pleaded guilty in July to possession of drug money in exchange for a promise of leniency from prosecutors, while Otoniel Urrego’s trial began last week.

After more than three hours of questioning Tuesday by Deputy Dist. Atty. James Grunert, the 39-year-old widow sobbed as she explained why she had agreed to testify against the man whom she described as a father figure for her three daughters.

“I waited for three or four months, hoping he would do something for me,” she said in Spanish, her voice cracking. “I expected him to plead guilty. . . . He knows I am the least involved in this. Upon seeing that he was not going to do anything, I contacted you.”

Otoniel Urrego showed no reaction as his sister-in-law implicated him in an operation that investigators say shipped $25 million in drug profits during the two months preceding the 1989 seizure at Luz Urrego’s home.

In an opening statement to the jury, Grunert described Otoniel Urrego as a high-ranking official in Colombia’s Medellin cocaine cartel. The defendant’s attorney, Terrence A. Roden, said he had nothing to do with the Simi Valley operation.

In her testimony, Luz Urrego said she and Otoniel Urrego were both from the Medellin area, but she had emigrated to Southern California when she met him in 1972. It was then that she married Otoniel Urrego’s younger brother, Jaime. They had three daughters before Jaime Urrego drowned in a swimming pool in 1982, she testified.

After Jaime’s death, Otoniel Urrego “was like a father to my children,” Luz Urrego testified, adding that she took the girls to visit him at his Miami home every summer for several years.

During that period, she said, she worked for an electronics company and eventually bought a house on Sweetwood Street in Simi Valley. At the time, she said, she did not know what Otoniel Urrego did for a living, but she did see him send and receive coded messages on a facsimile machine at his house.

In 1988, Luz testified, Otoniel’s brother, Floriberto Urrego, called her from Dallas to ask if she would work with Floriberto’s wife, Marta, in setting up an office in Simi Valley. He also wanted her to drive Marta Urrego around so she could pick up cars where drug money had been stashed, Luz Urrego testified.

“He said I should accompany Marta to pick up money,” Luz Urrego said. “I once asked him where the money came from. One day, in a laughing way, he said it was drug money, but he would laugh about it.”

Luz Urrego said she helped Marta find an apartment in Chatsworth, and Floriberto Urrego arrived to run an office that he had rented in a Simi Valley industrial park. The office, dubbed Pacific-American Exports, was where Floriberto Urrego would count, package and ship the money.

“He would count it at night and send it off the next morning,” she said, adding that she once saw him hide the cash in a drum of paint pigment for shipping.

Before the operation opened, she said, Otoniel Urrego called to say he was shipping a plastic-wrapping machine, which arrived at her house shortly afterward. And during the two months that the office operated, she testified, Otoniel Urrego was in close contact with his brother by telephone and facsimile machine.

“They were always in contact with each other,” she testified. Once, she said, she heard Floriberto tell Otoniel that “the money we had picked up the night before was short.”

After receiving faxes from Otoniel, she said, Floriberto would destroy them in a paper-shredding machine.

The night before the seizure, she said, Floriberto came to her house and said Otoniel had told him to move cash from the office. Floriberto said Otoniel was concerned because someone had been arrested in New York, Luz testified. Reluctantly, she said, she agreed to keep some of the money in a bedroom closet.

The next day, police seized the $1.5 million at her home and another $1 million in a car that Floriberto allegedly drove to a Chatsworth street. Floriberto, Marta and Luz Urrego were detained for several days in Ventura County Jail. Although they were released for lack of evidence, a Ventura County judge allowed Simi Valley police and other agencies to seize the money as the proceeds of drug sales.

Marta and Floriberto eventually returned to Colombia, investigators said. Luz and Otoniel were not arrested until last summer, investigators said, because it took years to put together the complex case.

Luz Urrego has been promised release from jail after her testimony and five years probation, Grunert said Tuesday. If convicted on all charges, Otoniel Urrego could face more than 20 years in prison, his attorney has said.