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The Hunt with John Walsh

Sex Slaves in Texas. Aired 9-10p ET

Aired August 14, 2016 - 21:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

[21:00:18] JOHN WALSH, CNN HOST: Back in 1981, I had the American dream, the beautiful wife, the house in the suburbs and a beautiful 6- year-old son. And one day I went to work, kissed my son good-bye and never saw him again.

In two weeks, I became the parent of a murdered child. And I'll always be the parent of a murdered child. I still have the heartache. I still have the rage. I waited years for justice. I know what it's like to be there waiting for some answers.

And over those years, I learned how to do one thing really well and that's how to catch these bastards and bring them back to justice. I've become a man hunter. I'm out there looking for bad guys.

(BEGIN VIDEO CLIP)

RUBEN PEREZ, ASSISTANT U.S. ATTORNEY: In the drug business, a kilo of cocaine, for example, is a commodity. In the human trafficking business, the commodity is the girl. The difference is this, once that kilo of cocaine is smuggled into the United States and it's used, the commodity is gone. A girl who has been smuggled into the United States and used as a sex slave, she can be used over and over. It's heart-wrenching.

(END VIDEO CLIP)

(MUSIC PLAYING)

EDWIN CHAPUSEAUX, FORMER INVESTIGATOR, SHERIFF'S OFFICE: A cantina is supposed to be a bar. It's just a name in mostly in Mexico used for bars. However, here in Houston, we have a lot of places that have been operating as bars that are actually just centers of prostitution, brothels.

And where you have a brothel, wherever you have prostitution, there's a good chance you're going to have women that are being forced into it.

Most of the women are brought across the U.S./Mexico border. It's a classic example of sex trafficking.

STEVEN ROSKEY, FORMER AGENT, TEXAS ALCOHOLIC BEVERAGE COMISSION: They're actually kidnapping somebody from another country and bringing them here for nothing other than just pure prostitution and slavery. WALSH: It's an uncomfortable subject that we as a rich country just don't want to deal with. The freest country in the world. Girls, women, can be kept as sex slaves. And, trust me, it is slavery.

ROSKEY: The attorney general's office here in the State of Texas was tasked with starting a state human trafficking initiative. Several other investigators had asked to come down to Houston and see some of these cantinas.

I was going to show them a couple of places. So let me take you to La Costenita. This location is one that's definitely on the radar. We drive up. It's in the afternoon.

You look around, and there's high fences. These fences were manned by lookouts. As soon as we pull up, the lookout who is standing on top of the fence sees us and just darts. He takes off. He, obviously, didn't realize he had left the keys to the castle there behind.

The TABC or the Texas Alcohol and Beverage Commission is a state agency. When somebody gets a TABC license, all their buildings are up for inspection. But they had several outbuildings. They would keep these doors locked. And the only way to get through is with these keys.

[21:05:00] Inside the location, you see the used condoms, the leaky roof, the smell of mold and dirt and plywood-made beds.

We have several people back there. Several girls. So we rounded everybody up. I had been to La Costenita many, many times doing the prostitution stings and doing arrests.

We've dealt with most of these women over and over again. So they already know the questions. You know, it's pretty much a staged story. I came here to work as a waitress, or I came here to clean houses.

CHAPUSEAUX: They come from countries where law enforcement is corrupt, where they can't trust the police. Why are they going to think we're any different?

WALSH: So the pimps are telling them two things. We have deep tentacles into Mexico. We know exactly where your family is and we can hurt them in five minutes. And the cops here are just as crooked as they are in Mexico. Nobody is going to get you help, and they brainwash these girls.

ROSKEY: We were down to the last female that we were interviewing. Her initial demeanor was just kind of stoic. But then all of a sudden, we noticed tears start running down her face. She started telling us her story. How she got here. What she was forced to do.

CHAPUSEAUX: She said her pimp was a man named Alfonso Diaz-Juarez who went by the nickname Poncho.

ESPERANZA: (SPEAKING IN FOREIGN LANGUAGE)

ROSKEY: After the child is born, he forced her right back into prostituting again at La Costenita.

ESPERANZA: (SPEAKING IN FOREIGN LANGUAGE)

ROSKEY: There comes a point in time when psychologically and emotionally, you have had enough. You have hit your wall. And I think that's what she had done.

ESPERANZA: (SPEAKING IN FOREIGN LANGUAGE)

ROSKEY: The problem you have with Poncho is he is a dangerous man. He's a sadistic person. He's sick. We have a short amount of time to work in. And if we don't get to this child, we don't know what he's capable of doing. And so we started pounding the streets trying to find her child.

(BEGIN VIDEO CLIP)

ROSKEY: We knock on a door. No, no, no. So at this point, she's frantic. She's scared.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

[21:13:00] ROSKEY: Now we have to find a child that we don't know where this child is going to be at.

ESPERANZA: (SPEAKING IN FOREIGN LANGUAGE)

ROSKEY: Based off of her information, we're knocking on doors or beat him on everywhere. As soon as we catch a possible where he might be, we're on our way. Patrol units are doing the same.

We knock on a door. No, no, no. So at this point, she's -- she's frantic. She's scared.

We knocked on Poncho's family member's houses. We knocked on his friends' houses. It irritated the family and friends so much that he eventually dropped off the child to a cousin.

And about 3:00 in the morning, we got a phone call. The child was safe. We were able to take the victim and reunite her with the child. I mean, it was emotional. It was an emotional time for us, too.

ESPERANZA: (SPEAKING IN FOREIGN LANGUAGE)

ROSKEY: Poncho was nowhere to be found.

WALSH: When Esperanza had the courage to come forward and talk to police at the threat of her own death, her own welfare, talked about how he kidnapped her, brutalized her, beat her and forced her into prostitution, guess what this big man did?

He ran.

Of course. He's a coward. [21:15:06] SUZANNE BRADLEY, SPECIAL AGENT FBI: In 2011, we were able to actually do a federal raid on that same location, and based on information provided by that same victim, it assisted us in the prosecution of individuals in that case.

ROSKEY: You know, thanks to our victim, La Costenita was bulldozed and no longer exists.

Even with the closing and demolishing of La Costenita, we still have one thing that's not wrapped up, and that's finding Poncho.

RACHEL ALVAREZ, CASE MANAGER, YMCA HUMAN TRAFFICKING PROGRAM: I thought human trafficking was just this crime that happens in third world countries. Until I started to look into my city.

People see Houston as a hub for human trafficking because of its proximity to the border. It also has access to the I-10 corridor, which goes across the country, so if they're smuggling people in and trying to get them into human trafficking in other areas of the country, it's very easy to get them on that I-10 route and disperse them throughout the country.

CHAPUSEAUX: The state of Tlaxcala, New Mexico, it's notorious for sex trafficking. The pimps run the place. They're in control of the towns.

Here in the U.S., you know, kids are dreaming about being an astronaut. Over there, little boys grow up wanting to be a pimp.

ALVAREZ: These pimps use different tactics to lure women to come from Mexico, Central America to the U.S. They give them false promises of a better life, of a job and they use people that they already trust. Say, their neighbor. And they paint this picture that once they come to the U.S., it's going to be a wonderful life.

CHAPUSEAUX: Poncho used all the pimp techniques. Sometimes he kidnapped the girls. Sometimes he seduced them. But sometimes he just tricked them into coming to the U.S. for a job.

LAURA: (SPEAKING IN FOREIGN LANGUAGE)

CHAPUSEAUX: If a pimp has, let's say, four, five girls, and each one is making him, you know, $2,000, $3,000 a week, do the math. Tax- free.

I've known a lot of these pimps. I kept a large database of pimps, but this guy, he was really a monster.

(BEGIN VIDEO CLIP)

LAURA: (SPEAKING IN FOREIGN LANGUAGE)

ALVAREZ: Guy after guy after guy. It stains them forever.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

[21:24:00] CHAPUSEAUX: Poncho was one of the most violent pimps I've come across in the 11 years I've worked human trafficking. He did a lot of brutal things bordering into torture to make the girls do what he wanted.

LAURA: (SPEAKING IN FOREIGN LANGUAGE)

ALVAREZ: One victim said that he was just beating her. She fell on the ground. She got hit with the butt of the gun on her head and she passed out. And when she woke up, he was still beating her.

She said he didn't even care if I was dead or not. He just kept at it.

[21:25:20] PEREZ: These girls are terrified of what can happen, not only to them, but more importantly what can happen to their family members.

LAURA: (SPEAKING IN FOREIGN LANGUAGE)

WALSH: Would you run if you are a 110-pound woman from another country and were worried about your family facing horrible repercussions? It's brainwashing. It's torture. It's demeaning. It's breaking the spirit of that person. Poncho is a full-blown five- star sociopath.

CHAPUSEAUX: The pimps, they don't have to take their women to one particular brothel. Most of them would take their girls to different brothels and then, because those close at 2:00 in the morning, they would go take them to Las Palmas, too, which was an after-hours. And then continue to work them until 4:00, 5:00, 6:00 in the morning. Because the thing is, let's exploit them as much as we can so we can make the largest amount of money possible.

When the customers initially come in at Las Palmas, they would have to pay a $5 cover charge.

So they would approach whichever girl. They would make the deal to engage in sex for whatever price. Usually it was $65.

BRADLEY: You would then go back to the entrance booth and pay another fee to get a second ticket.

CHAPUSEAUX: In the back of the ticket, they would write this is the 58th girl to go to the rooms tonight. They would have a ticket, they walk through this maze of junk until they reach the area where there's a wall. The person in the back behind that door charges for the room and condom. Then allows them passage to the second floor where the rooms are. 15 minutes is the allotted time.

LAURA: (SPEAKING IN FOREIGN LANGUAGE)

ALVAREZ: Guy after guy after guy. It stains them forever. CHAPUSEAUX: The owner of Las Palmas was a women named Raquel Medeles Hortencia Arguello. And she went by the nickname Tencha. That's what everybody knew her as.

Tencha had a group of about five or six girls that were minors locked up in a room on the second floor.

BRADLEY: They were 14, 15, 16 years old.

CHAPUSEAUX: These minors were upstairs and were only offered to certain clients that would pay a large amount of money to have sex with the minors.

BRADLEY: They pay good money. And when I say good money, they would pay for certain girls, $500 an hour.

CHAPUSEAUX: She left them there 24/7 locked up in that room.

WALSH: The minor is the ticket to jail for the big sentence. If you have an 18, 19-year-old sex slave that you've beaten and drugged and intimidated, your defense will be it's a consenting adult who works for me as a prostitute so charge me for prostitution of an adult.

So, yes, they lock the underage girls away because that is the big sentence. That's the big liability. We get lots more money for the young girls. We get lots more money from the weirdos, and the perverts, and the pedophiles and the child rapists, but we have to lock them up so nobody sees them, gets away with them because that will be our downfall.

[21:30:00] CHAPUSEAUX: That building on telephone road encompassed two different brothels -- La Feria and Las Palmas.

So business was really good for Tencha. I mean, she was making a lot of money.

UNIDENTIFIED MALE: We knew that there was some prostitution going on at Las Palmas. But in America, you don't just go pick people up and throw them in jail without any charges, without any evidence.

We need, obviously, to gather evidence, gather information in order to not only prosecute these cases, but to make sure that they were prosecuted successfully.

(BEGIN VIDEO CLIP)

CHAPUSEAUX: Our goal is to dismantle the entire organization. Take their money. Take their properties. That way there's nobody that can come behind and continue doing what they're doing.

(COMMERCIAL BREAK)

CHAPUSEAUX: The Houston task force on human trafficking had been watching Tencha since 2005. But building a solid case against an organization as big as this one is extremely challenging, and mainly for two reasons. [21:35:00] Number one, so many of the girls are reluctant to cooperate knowing that we can't protect their families back home. And, two, because it's hard to prove the knowledge and the intent by the traffickers when they're working behind the scenes.

In the case of Tencha, we needed to prove that she knew that these were minors being prostituted at her brothel, or adults that were being forced to work there as prostitutes. But that's not easy. It takes time to get the evidence that will make this happen.

RUBEN PEREZ, ASSISTANT U.S. ATTORNEY: I guess we can go in there and arrest one person and slap them on the wrist or whatever. And that's not our goal.

CHAPUSEAUX: Our goal is to dismantle the entire organization. Take their money. Take their properties. That way there's nobody that can come behind and continue doing what they're doing.

RACHEL ALVAREZ, CASE MANAGER, YMCA HUMAN TRAFFICKING PROGRAM: It's a hard pill to swallow knowing that an investigation was going on and knowing that night after night these girls were still being prostituted against their will.

PEREZ: Then she got wind that perhaps we were on to her. So she wanted to distance herself from Las Palmas, from the brothel, but still made money.

CHAPUSEAUX: So she decided to lease. Who she chose? Poncho. She leased the brothel to Poncho, Alfonso Diaz-Juarez.

A source told us that Poncho was taking over Las Palmas, and that he was there every day. He even received the keys and had control of the place. He was fixing it up.

We've been looking for Poncho ever since Esperanza came forward. This was the first we've heard about his whereabouts since 2010. We still had an outstanding warrant against Poncho for compelling prostitution because of Esperanza's testimony against him. So they arrested him.

STEVEN ROSKEY, FORMER AGENT, TEXAS ALCOHOLIC BEVERAGE COMISSION: I believe it was around October 2012 when I received a phone call from the Harris County district attorney's office just letting me know that Poncho had been caught. Basically Poncho wound up taking a plea deal for a year. After several months, he was wound up released from the sentence.

WALSH: 90 percent of crimes in America are plea bargain. So he's charged with a felony. His lawyer pleads it down to a misdemeanor, and he's out in less than a year for time served and good behavior. It frustrates prosecutors, it frustrates cops and it breaks the hearts of victims to see these guys get away with it. And they get away with it all the time.

PEREZ: One last storm that we had during the course of this investigation is we're able to recruit two informants. These informants came forward because they were appalled that some of the girls being prostituted there at Las Palmas were beaten, forced to do this, tortured. And they were also appalled that there were minors there.

CHAPUSEAUX: One of the two individuals that were helping us, he was the one that had to fill out those sheets. There was one that had basically columns where he would put the name, time went into the room, time came out of the room. There was another sheet that was basically like a total sales, where it would list the amount of money made that day.

PEREZ: Two informants within the organization who were giving us information, and more importantly recording a lot of the conversations going on at that brothel. So now we have recordings from Tencha herself where she said I like to deal with Poncho because Poncho provides the girls, and he trains them very well.

SUZANNE BRADLEY, SPECIAL AGENT FBI: We realize early on that we had potential financial crimes, money laundering involved in the case. So we got the IRS involved in it.

[21:40:12] LUCY TAN, SPECIAL AGENT IRS: My job was to follow the money. Review the bank statements, locate the assets. We did an estimate on how much she made from the room rental, the entrance fee and the condoms, and for the whole entire period she was operating Las Palmas II, and that estimated to be about $12.5 million.

CHAPUSEAUX: October 2013, we finally got to the point where the prosecutors, the agents were all satisfied. Everybody in agreement that we had enough. It was time to take this whole organization and operation down.

(BEGIN VIDEO CLIP)

CHAPUSEAUX: We've got the place surrounded. Nobody goes in. Nobody goes out. Then we were ready to strike.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

[21:45:06] PEREZ: A short time before October 2013 is when we said, OK, we've got enough evidence. We've got enough information. It's time to get this case indicted. Initially we included 14 defendants that permits sex trafficking. Tencha who is the leader. Then we had some of Tencha's siblings, some of Tencha's kids, some of Tencha's grandkids. We also had Poncho.

We knew that we wanted him, but we didn't know exactly where he was.

CHAPUSEAUX: So the case was taken before a grand jury, indicted, under seal. And then came the planning of executing, search warrants and arrest warrants.

BRADLEY: It was going to be conducted simultaneously because usually if you arrest one, the word gets out pretty quickly. People become fugitives. We had a command post to try to organize all of it. CHAPUSEAUX: It must have been at least seven locations that we hit. We had a team leader for each location.

I had Las Palmas II. We've got the place surrounded. Nobody goes in. Nobody goes out. Then, I sent SWAT to make entry.

It was a total of 14 defendants in the initial indictment. 13 were arrested that night. And they told me they were not able to pick up Poncho.

WALSH: Unfortunately when that well-coordinated, well-organized, multi-disciplinarian task force made the raid that night, they got everybody in their net, except one guy, probably the worst guy. The most sociopathic, brutalizer of women, Poncho.

CHAPUSEAUX: They all plead guilty except for Tencha.

PEREZ: Constitutionally, Tencha has every right to go to trial. And in this case, she decided to go to trial. And we respect that. Tencha was charged with one count of conspiracy to commit sex trafficking, one count of conspiracy to harbor aliens and three counts of money laundering and one count of conspiracy to money launder. She decided to plead not guilty. Forced us to prove that she is guilty. It's time to go to court on this case.

The very first girl who testified at the trial, she was very young at the time. She talked about how she was locked up in a room. She was only in her underwear. And that men would come up to that room and Tencha would sell her to those men for like $500 an hour. And it would be two men at the same time. And even though she was only a Spanish speaker, the word that she used was four hands in English and that described having sex with two men at the same time.

BRADLEY: You didn't have to speak Spanish to see how much pain they had over what had been done to them and what they had had to do. You could just see it in their face, hear it in their voice.

TAN: I couldn't, you know, hold my tears back. It was very emotional. Just hearing, you know, how the girls are emotionally scarred for the rest of their life.

(BEGIN VIDEO CLIP)

ALVAREZ: Tencha was crying in front of the judge. She said she had no idea what was going on. She was innocent. And the women felt furious.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

[21:53:45] PEREZ: In the trial, one pimp testified against Tencha, and two of her daughters and her son testified against Tencha as part of the plea deals. I think the defense played her more to be a person who ran a beer joint and that they were all willing prostitutes, and they were not underage. So therefore it was not a federal case. But the jury ultimately found her guilty.

At the punishment phase of the trial, she tried to tell the court she hadn't done anything wrong.

ALVAREZ: Tencha was crying in front of the judge and said she had no idea what was going on. She was innocent. And the women felt furious.

I was sitting next to them during trial. And as soon as Tencha did that, the first one, I'm going up there, and she did. And she went. Then the next. Then the next, and six of them went in front of the judge to say, you know, the victim here is us.

[21:55:07] PEREZ: Ultimately, the judge sentenced her to life in prison. In the federal system, there is no parole. So when you get sentenced to life, you come out in a box.

ALVAREZ: As soon as they said that she's getting life, this deep breath from all of them at the same time. Just relief that justice was made and tears of victory.

PEREZ: About a week after the trial of Tencha, Edwin Chap is one of the investigators in this case called me and said, Ruben, I've got something for you that the girls made for you. They made one for me as well.

When I get downstairs, there's a canvas. There's a tree on this canvas. And at the bottom it says, "The freedom and justice you fought for us has given us new life. And on that tree, there were 12 dots. And I didn't know what those dots were. They said those were the thumbprints of each girl we testified and we rescued.

CHAPUSEAUX: Why do we do this work? It's for them. It's knowing that you've made a difference in the life of these girls. That you've taken them from a very dark place and given them control over their lives.

PEREZ: The sad part is that we have a lot more work to do. I mean, yes, we rescued those 12 girls and, yes, we got justice for them, but there's a lot more work to be done because there's a lot more girls out there that need help.

BRADLEY: Poncho, Alfonso Diaz-Juarez, he's been a fugitive since October of 2013.

CHAPUSEAUX: It's very important to get Poncho arrested and prosecuted because he will not stop doing what he does. Not until he is arrested and put behind bars.

WALSH: The women that you see in this episode of THE HUNT put their lives on the line, put their family and loved one's lives on the line to come on camera. They most of all deserve justice. They most of all deserve to see Poncho caught. But they also need Poncho caught because they live in fear. They live in fear of his retribution.

LAURA: (SPEAKING IN FOREIGN LANGUAGE) ESPERANZA: (SPEAKING IN FOREIGN LANGUAGE)

PEREZ: My message to those victims is, please come forward. We're here to punish the bad people who have enslaved you. We're here to punish the people who have tortured you, who have hurt you. We're here to help.

WALSH: Alfonso Diaz-Juarez has a scar on his abdomen. He's been known to work at companies specializing in demolition and asbestos removal. Poncho has ties to Texas and Florida, but is a native of Puebla, Mexico.

If you have seen Alfonso Diaz-Juarez, or have any information as to his whereabouts, do not take any action yourself. Please, call 1-866- The-Hunt or go online at CNN.com/TheHunt.

You can remain anonymous. We'll pass your tip on to the proper authorities. And, if requested, will not reveal your name.

Now the FBI has come up with some red flags that allow people to identify victims of human trafficking or sex trafficking.

Does the woman work excessively long hours? Does she look deprived, emaciated, and have any physical abuse? Many times victims have been through such hell that they can't maintain eye contact.

If you think you've identified a victim of human trafficking, sex trafficking, don't approach that woman. It can get her in trouble.

Do the right thing. Make that call. The National Human Trafficking Resource Center maintains a hotline 24/7.

You can get it through information or in your phone book. Have the courage to make that call.