FOX10: Feds: Mobile ring laundered marijuana profits through casino chips, California cannabis firms
MOBILE, Ala. (WALA) – Prichard police pulled over a car in December 2019, finding thousands of dollars in cash and a driver who offered contradictory explanations about the money.
It was no lucky bust. Court records show that federal law enforcement officers had been on to the driver and his partners for months, tracking a sophisticated network that regularly smuggled marijuana by the kilo from California to the Mobile area. Those court papers show members of the conspiracy then laundered the profits in a variety of ways – including casino chips, real estate, cannabis businesses in the Golden State and a dummy corporation set up by one of the conspirators as a supposed construction firm.
The investigation would lead to the indictment of 14 people on federal drug charges, including nine who already have pleaded guilty. That includes Mohammed Zohair Adi, who pleaded guilty this week to conspiracy to commit money laundering. Also this week, a judge sentenced the man who was behind the wheel in Prichard that day in 2019, Damario Kentel King. The judge dismissed money laundering conspiracy charges as part of the plea bargain and sentenced him to 6½ years in prison for conspiracy to distribute marijuana.
Among those named in the indictment is Jervoris Scarbrough, whom Mobile police in December charged with murder in connection with a 2014 shooting. Scarbrough was the first person Mobile County prosecutors sought to jail without bail under Aniah’s Law, which gives judges broader discretion to keep people locked up pending trial on violent offences. A judge, however, granted bail in that case.
Federal prosecutions of marijuana crimes are relatively unusual. And Chase Dearman, an attorney who represented King, said the network that prosecutors alleged here has a level of sophistication more typically found in criminal enterprises dealing in harder drugs.
“Usually, you see that kind of stuff in cocaine cases where there’s a lot more money involved. … The more complex systems I’ve seen have usually been about cocaine,” he said.
Enough marijuana for 3.1 million joints
King, 35, admitted responsibility for 400 to 700 kilograms of marijuana from January 2018 through May 2021. Based on recent University of Pennsylvania research, a kilogram of the drug is enough for 3,125 joints. That means the entire 1,000 kilograms alleged in the indictment, theoretically, could produce more than 3.1 million joints.
Court records indicate that the enterprise was quite lucrative for King. According to his plea agreement, he filed no federal income tax returns in 2017 or 2018 and yet had more than $1 million in unexplained cash income.
Prosecutors allege that drug couriers would smuggle kilogram-amounts of marijuana on commercial flights from California to the Mobile area and then transfer the money back to people and entities in California.
Court records describe a multifaceted money-laundering operation to process the drug profits. Adi’s plea agreement indicates that he and others made “structured” financial transactions of less than the $10,000 threshold at which banks are required to report activity to the government.
The conspirators also purchased and redeemed casino chips with drug proceeds and deposited money in California bank accounts and the Mobile area, the plea agreement states.
Adi and another money launderer used multiple businesses and personal financial accounts to move money from the Mobile area to California, according to the plea document. In one example listed in the document, he wrote a $20,000 check to Investors Inc., which he had registered in California in 2012, representing that it was construction business. But court records show that it was used to launder drug proceeds.
Investors Inc. received more than S100,000 in deposits made in Mobile, Pensacola and California from October 2019 to January 2020 – including some cash that bank employees reported literally smelled like marijuana.
Adi admitted that he and other launderers spent drug proceeds on investments in nine California properties – five in Sacramento, and one each in Merced, Shingle Springs, Rumsey, and Lodi. Prosecutors have asked a judge to order the defendants to forfeit those properties, along with a Mercedes.
In some instances, prosecutors allege, members of the enterprise deposited drug proceeds directly into the accounts of legal cannabis businesses registered in California. At other times, they would pay the expenses of grow operations with illegal drug proceeds.
Attorney: Defendant runs legit business
One of the defendants named in the indictment, Navjit Bhullar, owns one of those businesses and denies the allegations.
“My fella is a legitimate marijuana grower in California where (in) the state of California, it’s legal what he’s doing,” said Bhullar’s attorney, Jeff Deen. “Still against the law, federally, and therein lies the rub.”
Deen told FOX10 News that Bhullar is subject to – and complies with – detailed rules of operation under California’s marijuana laws.
“He’s heavily regulated by the state of California,” he said. “He can grow plants. And they have inspectors come in and tag ‘em, all your plants. And they’ll come back a few months later and tag ‘em, look at ‘em, make sure they can see you haven’t got any more than you’re supposed to have. And then the quality’s tested.”
Court records paint a picture of a thorough investigation that unfolded over many months and involved multiple seizures of cash, and in some cases, drugs. In addition to that stop in Prichard involving King, court records detail seizures at airports in Mobile, Sacramento, San Francisco, New Orleans, Houston and several other cities.
During one of those trips, King and a co-conspirator traveled in September 2020 from Mobile to San Francisco. After he returned two days later, according to his plea agreement, law enforcement authorities arrested him with 125 pounds of bulk marijuana packaged in multiple vacuum-sealed bags hidden in suitcases.
A subsequent search of King’s cell phones contained extensive evidence of his involvement in the drug organization.
Investigators tracked tens of thousands of dollars in deposits King made in 2019 and 2020 using case and wire transfers to California bank accounts, which co-conspirators quickly withdrew.
King is eager to put his legal problems behind him and start a new chapter, according to Dearman, his attorney.
“Mr. King is a is a client that I’m particularly fond of,” he said. “He’s very intelligent, very smart. And I’m sure that he will come out of prison, and he will be successful in whatever he does.”
Original Article found here.
By Brendan Kirby
Published: Feb. 1, 2023 at 5:35 PM CST