Author Topic: Big-time pot growers use Seattle-area homes  (Read 69 times)

Elano

  • Guest
Big-time pot growers use Seattle-area homes
« on: December 02, 2007, 12:07:44 PM »

A bud bonanza in Seattle: More than 950 marijuana plants were found in this South Seattle home in October 2005. Grow lights were powered by pirated electricity tapped from an electrical mainline and fed through a power panel shown at right rear. The panel was specially created to bypass the home's electrical meter. The home's occupant was convicted in federal court for growing marijuana and was sentenced to three years in prison.

Narcotics investigators say large-scale indoor marijuana grow operations, such as this one found in the Kent area last year, cost about $30,000 to set up but can yield $1.5 million a year in profit.


From the sidewalk, the house on a sleepy cul-de-sac in Renton looked like a sweet slice of suburbia: four bedrooms, vaulted entryway, roses blooming out front.

But inside, the home was a marijuana factory. Furniture had been shoved aside to make room for banks of halogen bulbs with foil lampshades. Tubes of flexible ducting connected to an industrial-grade air scrubber. Power was diverted around the electric meter by splices direct from the main line.

In place of a family, the home's primary "occupants" were 658 marijuana plants. In a good year, the harvest would be substantial enough to pay off the mortgage on the $500,000 house and buy another home.

Growing pot indoors has old and deep roots in the green-thumbed Puget Sound area. But homes such as the one discovered in late 2005 in the hills above downtown Renton represent a new level of sophistication and scale in the lucrative cultivation of premium-grade marijuana that was once the franchise of British Columbia.

"B.C. bud" may have a new cousin: "King County bud."

Since 2005, federal and state agents have raided more than 100 large-scale grow houses in the Seattle area, yielding a bumper crop of more than 41,000 plants, according to the White House drug czar's office. Police last month found the biggest yet, a 1,500-plant grow that consumed most of a 3,800-square-foot house.

And Everett police were investigating a double homicide Monday in which two bodies were found in a home with more than 400 marijuana plants.

Most of the busts flowed from a sprawling, 18-month investigation into a garden-supply store in Kent, which led police to clusters of grow houses managed by a handful of entrepreneurs.

Since being opened by Canadian immigrants in 2003, the store, Kent Distributor, has become a one-stop shop for pot growers, according to federal court documents — offering everything from seedlings to grow lights on credit to an introduction to a real-estate agent who could help growers buy homes with no down payment.

Growers as businessmen

Drug investigators, as well as economists and defense lawyers, trace the boom in indoor-grow operations to tighter border security. Despite an array of new, post-Sept. 11 detection equipment, the amount of pot seized by border agents in the western U.S. dropped from 16,607 pounds to 5,300 pounds in four years, leading to the belief that smugglers are simply now growing in the U.S.

"This is not the marijuana subculture that has always had marijuana grows," said Lt. Rich Wiley of the Washington State Patrol's narcotics task force. "This is a new group, a recent occurrence. These people are not even using [marijuana] themselves. They're businessmen."

Drug investigators across the country — but particularly on the West Coast — are making similar finds. Last year, agents in the Sacramento, Calif., area busted 40 homes that together had more than 18,000 plants, while investigators in Oregon have busted at least three large-scale growing operations. As in other states, local investigators found the growers usually were Vietnamese, often with ties to Vancouver, B.C. And Seattle-area growers seemed to universally favor Kent Distributor.

The store owners, a Vietnamese family, and their employees were federally indicted in April for alleged marijuana trafficking and money laundering. All could face 10-year mandatory minimum sentences if convicted. Dozens of their former customers also were swept up, and more federal charges are expected.

Attorney David Gehrke, who represents the family matriarch, Le My Nguyen, conceded that part of the federal case was true.

"People who grew marijuana bought equipment there. But they also bought dirt at Home Depot and Lowe's," he said. "The fact that a lot of the growers were going there, I'm still not convinced it means my client knew what they were doing it for."

One house after another

The trouble for Kent Distributor started with a house fire in Kent in March 2005. Kent police found a 500-plant marijuana grow in the rubble and linked the occupants to several other grow houses, a common setup in Canadian grow operations. The occupants, after being charged in federal court, told police they had gotten equipment and advice from Kent Distributor.

Surveillance, which is detailed in federal affidavits in several cases, describes officers finding garbage bags full of pot clippings and root balls in the store's trash bin and listening to negotiations for the sale of "babies" — believed to be marijuana sprouts — for $25 apiece.

Investigators also followed customers back to homes throughout King and Pierce counties and say they usually found a Kent Distributor business card amid huge grow operations. Investigators say low-paid "tenders" usually handled the gardening, employed by higher-level managers who often operated four or five houses.

The houses were often unlivable, except for small corners inhabited by the tenders. Flexible ducting snaked through halls and bedrooms, sucking heat and humidity out through chimneys fitted with air scrubbers to remove the telltale odor of marijuana. The potted plants were often watered by drip systems and fed from jugs of fertilizer such as "Super Bud Blaster."

The homes fit a pattern: modern split-levels with multi-chambered chimneys for venting, daylight basements and big yards to keep the neighbors at a distance. Some had plants on a crop rotation: baby plants upstairs, juveniles downstairs, and adults — with baseball-sized buds — in the basement.

"It's pretty much all I've been doing for the past year and a half — [busting] one house after another," said Kent police Sgt. Jim Miller, head of a narcotics task force in the Kent Valley.

Jeffrey Steinborn, an attorney who represents an indicted store employee, said the largely Vietnamese customers didn't know a cardinal rule of marijuana cultivation. "All the American growers know that if you go to a grow shop, you're going to get followed home [by police] and busted," he said. "The Vietnamese didn't know that the feds were hanging out at the watering hole."

As the investigation gained traction, a police source described how Kent Distributor would provide on credit the $20,000 to $30,000 worth of equipment needed to set up a grow, to be repaid after the first harvest. Another source, who cooperated with police after being charged with running a grow operation, reported that Kent Distributor had hired 20 drivers to ship marijuana to Oklahoma and Texas, and plants to Iowa, according to a affidavit filed by a federal investigator.

"We've heard about 'Northwest pot' showing up all over the country," said DEA agent Art Staples.

Following the money

As an industry, marijuana in Washington state is roughly estimated at $1 billion in wholesale value, more than wheat and potatoes combined. In British Columbia, economists put pot at $6.5 billion (U.S.) a year, second only to oil.

The DEA estimates that a well-tended marijuana plant can yield up to $1,000 per harvest and three harvests a year, but some marijuana-legalization advocates consider that estimate extreme.

But the DEA did document that at least $5.1 million flowed through the bank accounts of Kent Distributor and its owners since 2003, most of it cash. In February, federal agents using a listening device planted in the office heard the sound of cash being counted by hand, then bundled with the snap of rubber bands.

Canadian drug investigators have followed the money into the mortgage industry, where unscrupulous brokers falsified loans for pot growers.

Local law enforcement says a small number of real-estate agents and brokers were involved with many of the King County grow houses busted.

According to a federal affidavit, one real estate agent, Thu Ahn "Diana" Tran, daughter of one of Kent Distributor's owners, was offered by the store as a resource for people looking to set up grow houses and bought a series of homes with her husband where grow operations were found.

Tran, who has been indicted for alleged money laundering, denied doing anything wrong when reached at Skyline Properties in Kent. "All I know is I'm selling house. I'm not helping out anyone," she said recently. "I'm just a normal regular (real estate agent)."

Skyline later said Tran no longer works for the firm.

Dave Rodriguez, Northwest director of the White House Drug Policy Office, compared the approach of going after the suppliers and real-estate industry supporting pot growers to one taken by methamphetamine investigators trying to shut off the supply of "precursor" chemicals used to make the drug.

"In B.C., they've got 10 years of experience doing this," he said. "We're the ones that are learning the business."

 

Elano

  • Guest
Re: Big-time pot growers use Seattle-area homes
« Reply #1 on: December 02, 2007, 12:08:26 PM »
Drug enforcement officials are seeing a spike in a lucrative cottage industry: indoor marijuana crops. This year's National Drug Threat Assessment, released by the Justice Department in October, says "vigorous outdoor cannabis eradication efforts have caused many marijuana producers, particularly Caucasian groups, to relocate indoors."

The "grow houses," as they're called, can be found in neighborhoods around the country, but they're becoming especially common in the Pacific Northwest — particularly in the suburbs of Seattle. Local police and federal investigators have raided at least 50 houses in the past two years alone. Authorities say they're just starting to get a handle on how widespread the practice is becoming.

Largely Run by Vietnamese Immigrants

Peter Truong is a community service officer for the sheriff's department in Seattle. He speaks Chinese and Vietnamese — also spoken by most of the people busted in grow houses around Seattle. Truong is constantly being called in by local police departments for help questioning the people arrested in the grow houses.

"A couple of weeks ago, I turn my cell phone off, my home phone off, because I got so tired," Truong says.

Truong immigrated to the United States in 1975 and has worked with the sheriff's department for 20 years. He says the people who live in grow houses tend to come from Vietnamese communities in other places — often Massachusetts and Vancouver, Canada. They're recruited by the grow operation owners to tend the plants, and they're told to keep a low profile in the suburban neighborhoods where the houses are located.

"They live normal life," Troung says, adding, "Really polite. You never know what inside."

Truong says the only tell-tale sign he's noticed is the rash that people get when they tend the plants. He guesses it's caused by the chemicals, or some other side effect of living in close quarters with hundreds of marijuana plants.

Tucked Amid Suburbia

The marijuana is grown in the middle of some very respectable Seattle suburbs, such as Renton. DEA special agent Clark Leininger has spent many long hours on stakeouts in quiet cul de sacs outside split-level homes that might sell for more than $400,000. He says he often has good evidence that a house is stuffed with pot plants, but he holds off making arrests, so he can find the larger network.

"Most of these people who are orchestrating these operations have multiple houses. Some investigators say the minimum is three, some say five. The largest number that I've run into is 12," Leininger says, referring to a case he investigated right there in Renton.

Leininger says the growers prefer to own their houses, because it eliminates the risk of a nosy landlord. And he says growers — or their intermediaries — have little trouble getting the loans to buy the houses they need. He said the man who bought 12 houses was a typical case.

"Many of the loans were zero-down, no-document loans," he says. "He did not have any employment, and if I remember correctly, he was able to purchase about $6 million worth of property — and he didn't have a job."

Backed by Crooked Mortgage Deals

It's a business model imported from British Columbia, where the grow house industry is far more advanced. In one notorious case, a mortgage broker named Danh "Victor" Van Nguyen was convicted of writing hundreds of fraudulent mortgages — many of which were found to have paid for houses containing marijuana grow operations.

Ken Frasier is with Financial Institutions Commission, a British Columbia agency that investigates, among other things, crooked mortgage deals. He says mortgage brokers there just aren't looking closely enough at who's borrowing.

"They'll simply 'pass paper,' so that they will get an application from an individual, they won't check it out, they'll simply forward it on," Frasier says.

Federal prosecutors say they're now finding the same patterns in Seattle. After Sept. 11, 2001, security on the Canadian border was tightened, making it harder to smuggle marijuana grown in the Vancouver suburbs — the well-known "B.C. Bud." So Vancouver-style grow houses started appearing in Seattle, often with Canadian ties.

In fact, Danh Van Nguyen's name — or those of his family — has shown up on deeds for Seattle-area homes that were raided as alleged grow houses. Nguyen and several other people with Vietnamese-Canadian ties have been indicted by the U.S. government. Nguyen himself is still a fugitive, living in Canada.

Federal prosecutor Sarah Vogel says it's clear to her that lenders in the Seattle area have not been asking enough questions of prospective borrowers.

Loose Lending Standards

"It seems like in some cases, applications didn't have true information on them, or perhaps in other cases nobody bothered to call," she says. "Perhaps in other cases, people just pay a higher interest rate in order to not have somebody check up on them."

The extent of background checking is a private matter between lender and customer. But King County records show that several of the houses raided for marijuana production around Seattle were bought with variable interest-rate loans, or with small down payments.

Steve Heaney, the president of the chapter of the Washington Association of Mortgage Brokers, which covers the suburbs where many of these houses are being found, says standards could be tighter — a process he says is already well under way. He says the fallout from the subprime mortgage meltdown has already made it much harder for someone without a clear source of steady, legal income to take out a mortgage.

But he also warns against tightening things up too much.

"I don't think anybody in my industry — other than the bad guys, and I believe they're a very small percentage — really want to facilitate the drug dealers. But if we eliminate completely loans with alternative documentation, there's cretainly a lot of legitimate Americans who aren't going to be able to buy a home," Heaney says.

And, legality aside, it's hard to argue with the marijuana growers' investment instincts. Typically raising three crops a year in bedrooms and basements of their suburban greenhouses, they rarely have trouble meeting their mortgage payments. And the houses, once they're raided, usually sell for more than the growers paid for them — one even went for twice the price.

 

Jdub925

  • Lil Geezy
  • *
  • Posts: 12
  • Karma: 1
Re: Big-time pot growers use Seattle-area homes
« Reply #2 on: December 02, 2007, 09:39:56 PM »
i bet the cops were gettin loaded off that!