U.S. Attorney Files Forfeiture Actions Against Properties and Bank Accounts Involved in Illegal Marijuana Production
|U.S. Attorney’s Office November 14, 2011|
SACRAMENTO, CA—United States Attorney Benjamin B. Wagner announced the filing of two civil forfeiture complaints targeting real property and the execution of a seizure warrant for bank accounts, all of which were used for purposes of commercial marijuana production. A civil forfeiture complaint was filed late Thursday against a parcel of real property in Butte County owned by Salvador Rocha which was being used for marijuana production, and a seizure warrant was recently executed for funds in three bank accounts belonging to an associate of Rocha’s. A separate forfeiture complaint was filed last month in an unrelated case against five parcels of real property located in Trinity County owned by Lapoe Smith, which were also being used for the production of marijuana.
Butte County Property
On November 10, 2011, the U.S. Attorney’s Office filed a civil forfeiture complaint against a 40‑acre property on Deer Valley Road in Bangor. The rural Butte County property was purchased by Salvador Rocha, an Arizona resident, in March 2010. According to the complaint, it was purchased with over $100,000 in structured financial transactions in violation of federal law.
According to the complaint, Rocha has two recent marijuana arrests, and was arrested at the subject property on September 26, 2011, for a violation of the terms of his probation. The complaint indicates that the property was being used to cultivate marijuana. Officers at the site observed marijuana plants, a new commercial grade marijuana trimming machine filled with marijuana buds, rows of marijuana plants drying inside one of the outbuildings, and four large tubs of dried marijuana waiting to be hand-trimmed. The other individual present at the property was Peter Bostrom.
Rocha purchased the property for $102,500 in cash on March 10, 2010. As described in the complaint, the investigation revealed that the funds used to purchase the property included at least 84 money orders purchased at multiple locations, and five cashiers’ checks purchased at three different banks, between February 25 and March 9, 2010. Each of the money orders was in an amount under $3,000, which is the amount which banks are required to record in a monetary instrument log under federal regulations. Each of the cashier’s checks was in an amount of $10,000 or less; federal law requires financial institutions issuing a check in excess of $10,000 to file a Currency Transaction Report. Under federal anti-money laundering laws, it is illegal to break down a single sum of currency exceeding $10,000 into smaller sums for the purpose of evading the filings of Currency Transaction Reports. It is also illegal to break down transactions into smaller sums to attempt to evade the $3,000 monetary instrument record keeping regulations.
The seizure warrants executed recently were for three bank accounts in the name of Rocha’s associate, Peter Bostrom. According to the affidavit in support of the seizure warrants, an investigation into financial transactions involving the accounts revealed that between July 6, 2011 and September 8, 2011, at least $135,750 was deposited into the bank accounts at six different bank branches located in New Jersey and New York, each in amounts under $10,000, an alleged violation of federal anti-money laundering laws. At least $67,000 of those deposits was withdrawn within a matter of days in the Eastern District of California.
Trinity County Properties
On October 14, 2011, the United States filed a civil forfeiture complaint against five parcels of property in Trinity County owned by LaPoe Smith, which the complaint alleges were being used for marijuana production. The complaint alleges that the properties were purchased on May 13, 2010 for approximately $161,000. About $121,000 of the purchase money had been structured into an escrow account through the use of dozens of money orders, cashier’s checks and bank checks purchased in San Antonio, Texas. According to the complaint, between April 20, 2010 and May 10, 2010, two bank checks and eight cashier’s checks totalling $50,000, each in increments of $10,000 and below, were purchased at multiple locations in San Antonio. During that same period, approximately 75 money orders totalling $71,222 in increments of $1,000 and below were purchased at multiple locations in San Antonio. According to public reports, Smith, who lives in San Antonio, Texas, is an NBA and NFL player agent and manages and oversees player’s contracts and finances.
U.S. Attorney Wagner said: “The commercial cultivation of marijuana is a violation of federal law, and commercial marijuana cultivators who attempt to mask their activity through structuring their financial transactions in violation of anti-money laundering laws can expect to have their property seized and forfeited.”