I was an FBI agent for approximately 28 years.

People laugh at me because I left sunny San Diego

with beaches and everything and a nice big house

to be in a small town, in Laredo.

They call it "the armpit" of Texas.

[honking]

It takes you all the way into Dallas,

and it even goes all the way up North in the US.

Now this is an area where there

was the biggest number of trucks crossing the whole border.

It was a very important route.

The Gulf Cartel was shipping marijuana,

cocaine, heroin through Texas to across the United States.

The Gulf Cartel was onto a good thing,

but it was about to get a whole lot better with the North

American Free Trade Agreement.

PRESIDENT CLINTON: And after we'll pare down trade barriers

between our three nations, it will create

the world's largest trade zone.

Today we have the chance to do what our parents did before us.

We have the opportunity to remake the world.

ARTURO FONTES: In Nuevo Laredo, it's

more important than almost any other area in Mexico,

and that's why it's a battleground.

It's a crown jewel for drug trafficking-- everybody

wants that.

MIKE CHAVARRIA: Osiel was a genius at being able to read

people and manipulate them.

He was brilliant at influencing people to do things

that they shouldn't be doing.

In the special forces, they had

radio code with the zed letter.

So they would have, like, [speaking spanish]..

They're be like, you know, Z2, I'm on alert.

They quickly became called "The Zetas," or "The Zeds,"

after that radio code.

MIKE CHAVARRIA: Osiel saw in them a discipline

that your regular trafficker did not have,

and that was a militarized discipline.

A respect for chain of command, loyalty,

the willing to attack the hill when told,

regardless of the outcome.

We saw that the Zetas were becoming a threat.

There was definitely a foreboding

of things to come as the Zetas began

to grow and become stronger.

And they were learning the drug trade from the Gulf Cartel.

Osiel is definitely in the crosshairs of the FBI and DEA.

He is public enemy number one.

[gunfire]

The arrest was like a scene out of Afghanistan, Iraq.

[gunfire]

The Mexican military I believe may

have lost one or two soldiers during the course

of that gun battle.

[gunfire]

Osiel survived.

He was apprehended, but it was quite the shootout.