LOUISVILLE, Ky. (WDRB) — Seven foreign nationals have been indicted for allegedly laundering millions of dollars through Louisville businesses in a federal case that links drug trafficking, weapons possession, and cross-border cash flow.
At the center of the case is Jose Malagon Castro, 49, a Mexican citizen and operator of El Rey Market I, II, and III, located on National Turnpike, Preston Highway, and Dixie Highway. Investigators say Castro used these businesses to wire approximately $34.7 million to multiple recipients in Mexico between 2020 and 2024.
The operation came to light after IRS Criminal Investigation agents seized over $500,000 in cash stashed in a backpack inside Castro’s truck. Authorities say the funds represent illegal proceeds from narcotics trafficking.
Federal documents allege that Castro employed Yeimi Hernandez Barahona, Kenia Hernandez Barahona, Kelin Hernandez Barahona (all citizens of Honduras), and Suri Rosmeri Hernandez Del Cid from Guatemala to conduct the wire transfers.
Two other Mexican nationals, Vanessa Avila Galaviz and Jose Martin Romero, were identified as narcotics traffickers who coordinated the laundering efforts through Castro’s stores.
In addition to money laundering, Castro was also charged with illegal possession of firearms and ammunition. The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) seized several weapons during the investigation.
Five of the suspects have been arrested and are expected to appear in court on Tuesday, April 29. However, Kenia Hernandez Barahona and Vanessa Avila Galaviz remain at large, with warrants issued for their arrests.
“This indictment traces the money pipeline that fuels transnational drug organizations,” said the Special Agent in Charge of IRS Criminal Investigation’s Cincinnati Office. “We are committed to dismantling the financial infrastructure behind these dangerous cartels.”
The investigation is part of Operation Take Back America, a federal initiative aimed at dismantling cartel-linked operations and enhancing community safety.
Multiple agencies were involved in the case, including the DEA, HSI, FBI, ATF, Louisville Metro Police, and Jeffersontown Police Department.
