LEXINGTON, Okla. — If associates of a reputed Mexican drug cartel leader had wanted to lay low while laundering money at an American horse ranch, they seemed to do everything wrong.

They swept their fields at night with a giant spotlight, threw around lots of cash, bought parcels of land in a deep recession and made expensive improvements to their farm in an industry not known for generating large profits.

“It would take a multi-millionaire just to support an operation like that,” neighbor Clifford Massengale said.

A day after federal authorities arrested ranch operator Jose Trevino Morales in an alleged money laundering scheme benefiting the notorious Zetas cartel, people in this Oklahoma horse ranching community said Trevino was a good neighbor. But his ranch, Zule Farms, seemed strangely out of step.

According to tax records cited by prosecutors, Trevino and his wife reported making only $58,000 in 2009. But somehow they plowed millions of dollars into the quarter-horse ranch.

Neighbors questioned how the couple and their associates could afford to pay cash for top-notch horses and said the pair’s determined effort to blend in with the area’s horse-farming culture actually made them stand out.

“The first thing I noticed was they were too obvious in their attempt to let people know they were in the horse business, but they were the best neighbors we’ve ever had on that property,” said Massengale, a retired military officer who lives next door.

He said ranch workers put fresh paint on the barns, built a new barn and took good care of the hundreds of horses that roam the 160 acres southeast of Lexington. The fields were finely manicured.

An indictment against Trevino and his wife, Zulema, was unsealed Tuesday in Texas. Agents raided ranches in Lexington, the Ruidoso Downs horse track in New Mexico and sites in Texas, arresting Trevino, his wife and five others.

The defendants are expected to be extradited to Texas to face charges. Seven other suspects, including two Trevino brothers, were charged but remain at large.

Greg Lucy, who owns Purcell Farm and Ranch Supply in a neighboring town, said it was unusual for anyone to put a large amount of money into a horse operation.

“The horse industry has been real tough over the last three years. Grain markets were high. Fuel markets were high. The drought last year was real tough,” Lucy said. Some operations have gone out of business.

Convenience store operator Jung Kim said Trevino once showed him satellite photos of his property and expressed an interest in expanding.

“I did think they were pretty rich,” Kim said. “They had a lot of nice horses, and the owner talked about buying some other ranches to grow hay.”

Trevino and the ranch hands would stop by occasionally for soft drinks, snacks and beer. They all appeared to be dedicated to the ranch.

“They were working hard every day. They had a lot of horses, raised them, bred them and took them racing,” he said. “I never thought they laundered money.”

Of all the money that the federal government said was spent — $20 million or more — little of it was spent locally. Lucy said he didn’t recall any major purchases at his store. At a saddle shop in Lexington, the people would browse but not buy.

“They didn’t have much of an impact at all on the local economy, as far as I could tell,” Lucy said.

Prosecutors reviewed records from banks, the American Quarter Horse Association and state racing commissions to track the money, according to an affidavit.

Several confidential informants shared information about Trevino and the two brothers also named in the indictment. One of the brothers, Miguel Angel Trevino Morales, helps lead the Zetas drug cartel in Mexico, prosecutors said.

Tax records showed that Trevino and his wife made $70,000 in 2008 and $58,000 in 2009, but that horses were transferred to his ownership to cover up his brothers’ effort to launder money. Horse records were often backdated to indicate Trevino bought an animal at a low price and that its winnings generated the money to run the farm when, in fact, it was drug money, according to prosecutors.

Authorities said Trevino and his wife would need to spend $200,000 per month to feed and care for the horses alone, much less the stunning landscape.

Wage records show that Trevino “did not have a legitimate source of income significant enough” to pay for either the horses or their care, authorities said.

Trevino and his wife lived in North Texas before moving to Oklahoma sometime around 2011, a neighbor said. Madeline Easterling of Balch Springs, Texas, said the couple had four children and that he often looked tired from laying bricks all day.

“We are just floored,” Easterling said. “I can’t help but feel like there has to be some kind of mistake.”

A woman who was at the family’s former home Tuesday in Balch Springs said she was Jose Trevino’s niece. She insisted the charges were untrue.

The woman, who would only give her middle name, Isabel, said the U.S. government was discriminating against Mexicans and unfairly naming Jose Trevino because of his ties to his brother.

“Just because we’re related to him, they’re trying to tie us to that,” she said. “I don’t get it, though. It’s all stories.”

Debbie Schauf, director of the Oklahoma Quarter Horse Racing Association in Edmond, said the quarter horse industry is not the “sport of kings,” like the high-price thoroughbred industry, and that upfront expenses aren’t that great.

Still, Trevino had 425 horses, so basic daily maintenance would have cost thousands of dollars per day, maybe more to care for race horses.

In New Mexico, a woman who regularly attending horse auctions at Ruidoso Downs said Trevino’s group would use different bidders so it wasn’t obvious who was buying. But the group stood out for the vast amount of money it spent.

Everybody “suspected where the money came,” said the woman, who spoke on condition of anonymity because she feared retribution from the cartel.

K.D. Wilhite, whose Old Dog Gun Shop faces the Oklahoma ranch, was grateful for ranch workers who kept a ditch clear of weeds. But he noticed after the fact that some things seemed odd.

“There is no way they could make that much profit from that operation, not unless they know something I don’t,” Wilhite said.

Anyone who spends that much money “is going to stand out,” he said. “They would have had to buy an awful lot of feed. It appeared to me horses were coming and going all the time.”

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Associated Press writers Nomaan Merchant in Balch Springs, Texas, and Juan Carlos Llorca in Ruidoso Downs, N.M., contributed to this report.