3 Arrested, Counterfeit Documents Confiscated : Crime: Authorities believe they busted a major ring in Canoga Park. Leaders are believed to be at large.

Hundreds of phony documents were seized and three people were arrested Saturday in connection with what authorities said is a major counterfeiting ring that manufactures fake driver’s licenses, immigration cards and other official papers.

It was the fifth time in two years that undercover Los Angeles police officers and state investigators had busted counterfeiters hawking documents in a parking lot at Sherman Way and Variel Avenue.

The officers followed the suspects from the parking lot to a nearby apartment that served as a “paper mill,” where the phony documents were assembled. Investigators confiscated a laminating machine, a typewriter with different daisy wheels, a paper cutter and hundreds of blank birth certificates and other documents from the two-bedroom apartment in the 6900 block of Millwood Avenue.

But investigators believe the ringleaders of the counterfeiting operation are still at large because the printing press on which the documents were manufactured was not among the equipment seized.

The ring operates out of Canoga Park because of its high concentration of immigrants, investigators said. Detective Michael Lewin estimated that the counterfeit operation netted thousands of dollars every week.

“It’s a steady, ongoing thing,” Lewin said. “We look for it, clean it out, and about a week later, there’s a new crop back.”

Investigators identified two of the suspects as Sandoval Cota, 18, of Sonora, Mexico, and Ernesto Llanes, 22, of Sinola, Mexico. But they said the men used counterfeit documents to identify themselves, so investigators have yet to confirm their identities.

The third suspect was identified as Alonso Yerena, 29, from Mexicali, who told police that he is a naturalized citizen from Mexico whose documents were stolen in Miami.

All three suspects were arrested on suspicion of felony forgery and were being held at Van Nuys Jail in lieu of $10,000 bail each. If convicted, they could face up to a year in prison.

The bust was made by the multi-agency Community Effort to Combat Auto Theft (CECAT) task force, which includes the California Department of Motor Vehicles and the Los Angeles Police Department.

Previous busts include the breakup last year of a paper mill operating out of an apartment on nearby Gault Street after detectives purchased phony documents in the names of Gov. Pete Wilson and City Councilwoman Laura Chick. Six men later pleaded guilty to forgery.

Police said Saturday’s discovery of the counterfeiting lab began about 1:30 p.m. as CECAT officers were driving back from an unrelated investigation.

Investigators noticed the suspects signaling the availability of forged documents to passersby in the parking lot of a local shopping center and set up an impromptu surveillance.

Lewin said Cota took information supplied by Yerena back to the Millwood Avenue apartment. Half an hour later, Cota and Llanes left the apartment, bicycling back to Yerena with a phony Social Security card that cost about $30.

Police arrested the three men in the parking lot. Three others believed to be lookouts fled.