Returning to the Top of the Charts

Three years ago, Jesus Gilberto Moreno was mired in an ugly payola scandal that left him with a dubious distinction: He became the only senior record executive ever successfully prosecuted for improperly buying radio airplay.

As of this week, however, Moreno is rising again toward the top of the Latin music business -- this time as chief of regional Mexican music for Universal Music Group’s rapidly growing Latin division.

Universal also plans to buy Moreno’s current firm, Houston-based Musimex. It had been financed by Sony Music, which also distributed its albums.

Never jailed, Moreno was nonetheless stung by a $50,000 fine and two years’ probation on a misdemeanor count, while his former employer, Fonovisa Records, tumbled from grace.

Asked about his prosecution and comeback during an interview last week, Moreno said: “It’s something in my past that I want to forget. I want to do things correctly. I don’t want to make any more mistakes.”

Universal executives say they don’t believe he will trip up again.

“He’s a hard worker,” said John Echevarria, president of Universal Music Latino. “There were games played [at Fonovisa], and we will not tolerate it. This is a different company.”

After an inquiry into promotional practices in the Latin music business, federal prosecutors in 1999 charged Moreno, Fonovisa’s head of promotions, with a single payola count, to which he pleaded guilty. Authorities said Moreno had paid $2,000 to an unnamed radio programmer to boost airplay of Fonovisa acts.

Fonovisa’s then-president, Guillermo Santiso, later pleaded guilty to a felony payola-related tax count, and the label itself admitted to a felony tax count for falsely reporting promotional expenses.

The government charged Santiso with writing $425,000 in checks to a phony company to launder cash used by employees to bribe programmers.

Before Moreno was sentenced, his attorneys told the court that his willingness to pay for play resulted “at least in part from the social mores” in the executive’s native Mexico. There such payments are legal.

The attorneys also said Moreno “believed his actions to be in the best interests of his company. He did not seek personal pecuniary gain or individual reward, but merely endeavored to carry out his corporate responsibilities.”

This time around, according to Echevarria, Universal is banking heavily on the scouting ability that built Moreno’s Musimex roster of regional artists.

In regional Mexican music, the biggest genre in the Latin field, Moreno’s ear for talent “is second to none,” Echevarria said.

“He’s the one who built [Fonovisa] into the most powerful regional Mexican music company in the business.”