California’s Top Federal Law Enforcement Officials Announce Enforcement Actions Against State’s Widespread and Illegal Marijuana Industry

October 10, 2011

The U.S. Drug Enforcement Administration (DEA) on October 7, 2011 released the following:

“SACRAMENTO, Calif. – The four California-based United States Attorneys today announced coordinated enforcement actions targeting the illegal operations of the commercial marijuana industry in California.

The statewide enforcement effort is aimed at curtailing the large, for-profit marijuana industry that has developed since the passage of California’s Proposition 215 in 1996. That industry has swelled to include numerous drug-trafficking enterprises that operate commercial grow operations, intricate distribution systems and hundreds of marijuana stores across the state — even though the federal Controlled Substances Act makes illegal the sale and distribution of marijuana.

While the four United States Attorneys have tailored enforcement actions to the specific problems in their own districts, the statewide enforcement efforts fall into three main categories:

  • Civil forfeiture lawsuits against properties involved in drug trafficking activity, which includes, in some cases, marijuana sales in violation of local ordinances;
  • Letters of warning to the owners and lienholders of properties where illegal marijuana sales are taking place; and
  • Criminal cases targeting commercial marijuana activities, including arrests over the past two weeks in cases filed in federal courts in Los Angeles, San Diego, Sacramento and Fresno.

The enforcement actions being announced today are the result of the four United States Attorneys working with federal law enforcement partners and local officials across California to combat commercial marijuana activities that are having the most significant impacts in communities.

“The DEA and our partners are committed to attacking large-scale drug trafficking organizations, including those that attempt to use state or local law to shield their illicit activities from federal law enforcement and prosecution,” said DEA Administrator Michele M. Leonhart. “Congress has determined that marijuana is a dangerous drug and that its distribution and sale is a serious crime. It also provides a significant source of revenue for violent gangs and drug organizations. The DEA will not look the other way while these criminal organizations conduct their illicit schemes under the false pretense of legitimate business.”

“The actions taken today in California by our U.S. Attorneys and their law enforcement partners are consistent with the Department’s commitment to enforcing existing federal laws, including the Controlled Substances Act (CSA), in all states,” said Deputy Attorney General James Cole. “The department has maintained that we will not focus our investigative and prosecutorial resources on individual patients with serious illnesses like cancer or their immediate caregivers. However, U.S. Attorneys continue to have the authority to prosecute significant violations of the CSA, and related federal laws.”

Benjamin B. Wagner, the United States Attorney for the Eastern District of California stated: “Large commercial operations cloak their moneymaking activities in the guise of helping sick people when in fact they are helping themselves. Our interest is in enforcing federal criminal law, not prosecuting seriously sick people and those who are caring for them. We are making these announcements together today so that the message is absolutely clear that commercial marijuana operations are illegal under federal law, and that we will enforce federal law.”

André Birotte Jr., the United States Attorney for the Central District of California, stated:“The federal enforcement actions are aimed at commercial marijuana operations, including marijuana grows, marijuana stores and mobile delivery services – all illegal activities that generate huge profits. The marijuana industry is controlled by profiteers who distribute marijuana to generate massive and illegal profits.”

Laura E. Duffy, the United States Attorney for the Southern District of California, commented: “The California marijuana industry is not about providing medicine to the sick. It’s a pervasive for-profit industry that violates federal law. In addition to damaging our environment, this industry is creating significant negative consequences, in California and throughout the nation. As the number one marijuana producing state in the country, California is exporting not just marijuana but all the serious repercussions that come with it, including significant public safety issues and perhaps irreparable harm to our youth.”

Melinda Haag, the United States Attorney for the Northern District of California, said: “Marijuana stores operating in proximity to schools, parks, and other areas where children are present send the wrong message to those in our society who are the most impressionable. In addition, the huge profits generated by these stores, and the value of their inventory, present a danger that the stores will become a magnet for crime, which jeopardizes the safety of nearby children. Although our initial efforts in the Northern District focus on only certain marijuana stores, we will almost certainly be taking action against others. None are immune from action by the federal government.”

Dozens of letters have been sent over the past few days to the owners and lienholders of properties where commercial marijuana stores and grows are located. In the Southern and Eastern Districts, the owners of buildings where marijuana stores operate have received letters warning that they risk losing their property and money derived from renting the space used for marijuana sales. In the Central District, where more than 1,000 stores are currently operating, prosecutors have sent letters to property owners in selected cities where officials have requested federal assistance, and they plan to continue their enforcement actions in other cities as well. In the Northern District, owners and lienholders of marijuana stores operating near schools and other locations where children congregate have been warned that their operations are subject to enhanced penalties and that real property involved in the operations is subject to seizure and forfeiture to the United States.

In the Central District and Eastern District, prosecutors this week filed a total of seven civil forfeiture complaints against properties where landlords are knowingly allowing marijuana stores to operate. One complaint filed against a south Orange County strip mall, for example, alleges that eight of the 11 second-floor suites in the buildings are occupied by marijuana stores and that one small city has spent nearly $600,000 in legal fees in its attempt to eradicate the illegal operations.

Criminal cases recently unsealed across the state reveal marijuana operations that produce huge profits, send their money and illegal narcotics to other states, and market products to young people. In a case involving a now-closed marijuana store in the San Fernando Valley, two conspirators allegedly used encrypted smartphones to coordinate marijuana sales to places as far away as New York and estimated that they would each receive $194,000 in profits per month. In a San Diego dispensary case unsealed last week, six defendants were charged in a 77-count indictment that alleges a wide-ranging conspiracy that included numerous marijuana sales to under-aged persons.

Victor S.O. Song, Chief, IRS Criminal Investigation, stated: “IRS Criminal Investigation is proud to work with our law enforcement partners and lend its financial expertise to this effort. We will continue to use the federal asset forfeiture laws to take the profits from criminal enterprises.”

Across California, the federal government will continue to investigate and prosecute those whose actions not only violate federal laws, but also the state laws regarding the use of marijuana. The problems associated with the marijuana business have dramatically increased over the past two years, even in areas where local governments and citizens actively oppose these businesses.

The statewide coordinated enforcement actions were announced this morning at a press conference in Sacramento.”

To find additional federal criminal news, please read Federal Crimes Watch Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN Sanctions Removal.

The author of this blog is Douglas McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.

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Mack Baker, Marvin Williams, and Richard Sims Indicted by a New Orleans Federal Grand Jury for Violations of the Federal Controlled Substances Act

August 23, 2011

The Federal Bureau of Investigation (FBI) on August 22, 2011 released the following:

“Three New Orleans Men Indicted for Violations of the Federal Controlled Substances Act, Fourth Man Arrested

NEW ORLEANS— MACK BAKER, age 23; MARVIN WILLIAMS, age 22; and RICHARD SIMS, age 30, all of New Orleans, Louisiana, were charged in a three-count indictment by a federal grand jury for violations of the Federal Controlled Substances Act, announced U.S. Attorney Jim Letten. A fourth man, TYRONE DUNCAN, was arrested today, on a complaint for related charges.

Count one charged BAKER, WILLIAMS, and SIMS with conspiring to distribute and possession with the intent to distribute heroin. Count two charged BAKER and WILLIAMS with distributing heroin on June 9, 2011. Count three charged BAKER, WILLIAMS, and SIMS with distributing heroin on June 20, 2011. DUNCAN is charged in a complaint with conspiring to distribute and possession with the intent to distribute heroin. DUNCAN is charged with distributing heroin on June 2, 2011.

If convicted, BAKER, WILLIAMS, SIMS, and DUNCAN could face a maximum term of imprisonment of 30 years, a fine of $6,000,000, and six years of supervised release following any term of imprisonment.

Agents with the Federal Bureau of Investigation are conducting an investigation of the lower 9th Ward in response to an upsurge in heroin distribution and an increase in violent crime, including murders.

U.S. Attorney Letten reiterated that the indictment is merely a charge and that the guilt of the defendants must be proven beyond a reasonable doubt.

The case is being investigated jointly by the Federal Bureau of Investigation and prosecuted by Assistant United States Attorney Elizabeth Privitera.”

To find additional federal criminal news, please read Federal Crimes Watch Daily.

Douglas McNabb and other members of the U.S. law firm practice and write extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN List Removal.

The author of this blog is Douglas McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.

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Derrick Johnson Pled Guilty in New Orleans Federal Court to Federal Drug Charges

August 19, 2011

The Federal Bureau of Investigation (FBI) on August 18, 2011 released the following:

“LaPlace-Area Man Pleads Guilty to Federal Drug Charges

NEW ORLEANS, LA— DERRICK JOHNSON, age 35, from the LaPlace, Louisiana area, pleaded guilty before U.S. District Court Judge Lance M. Africk to violations of the Federal Controlled Substances Act involving conspiracy to possess and possession with the intent to distribute cocaine hydrochloride, announced U.S. Attorney Jim Letten.

According to court documents, on or about March 31, 2010, JOHNSON and two co-defendants conspired to retrieve a kilogram of cocaine hydrochloride from a hidden location in Lacombe, Louisiana. Unbeknownst to them, a confidential source had tipped off law enforcement authorities to the plan and both men were arrested shortly after taking possession of the kilogram of cocaine. JOHNSON pleaded guilty to both counts of the indictment, which alleged conspiracy to possess and possession with the intent to distribute more than 500 grams of cocaine hydrochloride.

Sentencing is schedule for on November 17, 2011, and the defendant faces a maximum term of imprisonment of 40 years, a maximum fine of $5 million, and four years of supervised release.

This investigation was investigated by the St. Tammany Parish Sheriff’s Office and the Federal Bureau of Investigation. This case is being prosecuted by Assistant United States Attorney Edward J. Rivera.”

To find additional federal criminal news, please read Federal Crimes Watch Daily.

Douglas McNabb and other members of the U.S. law firm practice and write extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN List Removal.

The author of this blog is Douglas McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.

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