Nightclub Magnate Sentenced to 16 Years for Drug Crimes

A DFW nightclub magnate was sentenced to 16 years in federal prison for operating an empire of clubs in which drugs were sold openly, announced Acting U.S. Attorney for the Northern District of Texas Chad E. Meacham.

In November 2021, a federal jury found OK Corral/ Far West owner Alfredo Hinojosa, general manager Miguel Casas, and noted promoter Martin Salvador Rodriguez guilty of managing drug premises, conspiracy to manage drug premises, and conspiracy to possess with intent to distribute cocaine. Mr. Hinojosa was sentenced on Friday by U.S. District Judge Sam A. Lindsay, who imposed a $120,000 fine in addition to the prison time.

The overall case included more than 30 defendants, all of whom have been convicted, including former Dallas Police Officers Eddie Villarreal and Craig Woods. At sentencing, Judge Lindsay called Mr. Hinojosa the “top dog” in the scheme, and noted that the “buck stopped” with him.

According to evidence presented at trial, Mr. Hinojosa, Mr. Casas, and Mr. Rodriguez ran a conglomeration of businesses that brought in revenue of more than $107 million over a four-year period. 

The defendants allowed cocaine to be sold in the bathrooms of their nightclubs on a daily basis, because such drug sales attracted customers and provided them with a competitive edge over rival clubs.  These drugs sales increased revenue at the clubs between $9 million and $12 million.

“These defendants made millions by explicitly allowing cocaine trafficking in nightclubs across DFW. They assumed that permitting bathroom drug deals would be their ‘competitive edge.’ Instead, it was their downfall,” Acting U.S. Attorney Chad Meacham said following the conviction. “The United States Attorney’s Office and the FBI will not permit nightclub owners – or anyone else – to willfully turn a blind eye to drug trafficking happening on their premises.”

“This conspiracy was designed to elevate the status of the defendants at a very high cost to our society,” said FBI Dallas Special Agent in Charge Matthew J. DeSarno. “Their extensive plans to conceal nightly high-volume drug sales included the recruitment of law enforcement officers as employees. We will continue to work with our local, state, and federal partners to protect the integrity of the profession, uphold the public’s trust, and prevent access to illicit drugs in our greater Dallas-Fort Worth communities.”

At trial, prosecutors presented evidence of 17 controlled drug buys that occurred at the OK Corral Dallas, OK Corral Fort Worth, and Far West nightclubs between 2013 and 2016. Half a dozen informants, all under the supervision of FBI agents, bought bag after bag of cocaine from traffickers operating out of club bathrooms.

Multiple security guards who worked inside the clubs testified at trial that Mr. Hinojosa, Mr. Casas, and Mr. Rodriguez knew the drug trafficking was occurring and openly ordered security personnel to allow it.  Drug traffickers, previously charged and convicted in the case, also testified that they were allowed to operate freely.

At trial, FBI agents explained that in 2015, they installed court-ordered microphones and a camera in Mr. Hinojosa’s office, unbeknownst to the defendants.  Agent also sought and obtained more a dozen wiretaps in the case.  During these recorded calls and intercepted communications, Mr. Hinojosa could be heard saying, “we can’t really clean it because then we lose business,” and “we need cocaine, man.”

Mr. Hinojosa, Mr. Casas, and Mr. Rodriguez eventually confessed to knowing that the drug sales were ongoing and allowed.  Prosecutors played Mr. Hinojosa’s 45-minute recorded interview for the jury.  Other agents recounted statements made by Mr. Casas and Mr. Rodriguez.

According to one agent’s notes, Mr. Casas told a task force officer that when club management realized the business was “tanking,” they told bouncers to allow the drug sales to resume and leave drug dealers alone as long as they were “discreet.”

The Federal Bureau of Investigation’s Dallas Field Office and the Dallas Police Department conducted the investigation, which was dubbed “Operation Closing Time.” The Texas Alcoholic Beverage Commission's Enforcement Division, IRS – Criminal Investigations, and the Texas Attorney General’s Office provided valuable assistance. Assistant U.S. Attorneys P.J. Meitl, Nicole Dana, and Melanie Smith prosecuted the case.