Caracho met his future ally, Pedro Oliveiro Guerrero, alias "Cuchillo," while both men were mid-level paramilitary commanders in the AUC. After Cuchillo killed AUC warlord Miguel Arroyave in 2004, Arroyave's army, known as the Centauros Bloc, split into two factions. Caracho joined one of these, which became known as the Heroes del Llano Bloc.

Heroes del Llano officially demobilized in April 2006, and Caracho began working alongside Cuchillo, even though the bloc commander, Manuel de Jesus Piraban, alias "Pirata," is thought to have been hostile to the ruthless Cuchillo. The bad feeling did not pass over to the relationship between the two fighters. When Cuchillo founded the Popular Revolutionary Anti-Terrorist Army of Colombia (ERPAC), Caracho went with him.

He soon became one of Cuchillo's most trusted men. Caracho is suspected of overseeing two assassination attempts -- July 2009 and March 2010 -- against "Emerald Czar" Victor Carranza, a sign of the confidence that the ERPAC leader had in him.

Caracho reportedly spent part of his ERPAC career based in the eastern department of Vichada, coordinating drug shipments on behalf of Cuchillo's ally Daniel Barrera, alias "El Loco." He was also responsible for handling the extortion payments, or "vacunas," paid by coca and palm oil farmers, ranchers and small-scale businesses in ERPAC strongholds like Mapiripan and San Martin.

After Cuchillo's death in a police raid in December 2010, Caracho inherited control of the ERPAC. He ran the group's operations while based in northern Guaviare or southern Meta, perhaps the municipality of Mapiripan, where Cuchillo was killed and where much of his land holdings were concentrated.

In December 2011, Caracho negotiated the demobilization of some 272 ERPAC fighters, including himself. He is currently in prison awaiting trial.