By Brendan Pierson and Jonathan Stempel
NEW YORK (Reuters) - Joaquin "El Chapo" Guzman was a top leader of Mexico's Sinaloa Cartel along with drug lord Ismael Zambada for years and personally invested in massive cocaine shipments to the United States, Zambada's brother told jurors on Wednesday.
The testimony from Jesus Reynaldo Zambada, 57, came on the second day of Guzman's drug trafficking trial in Brooklyn federal court.
Jesus Zambada, who was extradited to the United States from Mexico in 2012 and is cooperating with U.S. authorities, offered a look at the inner workings of the cartel, which prosecutors say has made billions of dollars selling cocaine, heroin, marijuana and methamphetamine.
Guzman, 61, faces 17 criminal counts, and life in prison if convicted. His lawyer, Jeffrey Lichtman, told jurors in his opening statement that Ismael Zambada was the leader of the cartel, and Guzman a mere scapegoat.
Jesus Zambada, who has a college degree in accounting, testified that he first became involved in the cartel around 1987 when he developed an accounting system for collecting money from cocaine buyers in the United States. He said he remained in the organization until his arrest by Mexican authorities in 2008. By then, he said, the organization was largely run by his brother, who remains at large, and by Guzman.
Zambada said his work included receiving multi-ton shipments of cocaine from Colombia by boat on a beach in Cancun and overseeing a warehouse in Mexico City where cocaine was stored before being smuggled to the United States.
Speaking calmly and dressed in blue and orange prison clothes, he told jurors that cocaine was transported in gasoline tanker trucks, partly filled with gasoline to avoid detection, to crossing points on the U.S. border.
Zambada also delved into the financing of cross-border drug deals, explaining that the Sinaloa Cartel's top and mid-level leaders would pool money to invest in shipments from Colombia. Each investment, split evenly with Colombian suppliers, could yield tens of millions of dollars in profit, he said.
Zambada said his brother and Guzman jointly invested in multi-ton shipments in the 2000s. He offered few other details about Guzman, although he said he had spoken to him on the phone several times. In court, Guzman sat at a table with his lawyers listening to the testimony and showing no emotion.
Zambada is expected to continue testifying on Thursday. He is the first of several former Guzman associates under cooperation agreements who are expected to testify at the trial, which is expected to last up to four months.
Assistant U.S. Attorney Adam Fels told jurors in his opening statement on Tuesday that the evidence in the case would trace the story of Guzman's rise from a low-level marijuana trafficker to a powerful drug lord who became one of the world's most wanted fugitives.
After years on the run and two dramatic prison escapes, Guzman was finally captured in January 2016 in his native Sinaloa in northwest Mexico and was extradited to the United States a year later.
The Sinaloa Cartel has played a major role in narco violence between rival gangs that has torn areas of Mexico apart.
(Reporting by Jonathan Stempel and Brendan Pierson; Editing by Alistair Bell and Rosalba O'Brien)