cannabisnews.com: A Sunny Street's Shady Side! A Sunny Street's Shady Side! Posted by FoM on July 23, 1999 at 07:18:47 PT By Jeff Leeds, Times Staff Writer Source: LA Times U.S. officials have tried, with mixed results, to seize four Zumirez Drive homes in Malibu from residents accused of narcotics trafficking, marijuana cultivation and credit card fraud. On a quiet cul-de-sac overlooking the Pacific where personal paradises sell for millions, homeowners are digesting an unsettling lesson: Fat wallets make for strange bedfellows. And moneyed neighborhoods don't get much stranger than Malibu's tree-lined Zumirez Drive. On the upside, sunsets and city lights sparkle across the water on summer evenings. Homeowners can ride golf carts down to their private beach. Barbra Streisand, "X-Files" creator Chris Carter and film score composer Hans Zimmer reside here, just a few gated driveways apart. But they aren't the only ones with a hunger for oceanfront property. Since 1991, U.S. officials have tried--with mixed results--to seize four Zumirez Drive homes from residents accused of narcotics trafficking, marijuana cultivation and credit card fraud. Under forfeiture laws, prosecutors can confiscate cars, real estate and other property if they can show the assets are linked to a criminal enterprise. But so many property cases in such close proximity appear to have set a precedent in law enforcement. And it leaves Zumirez Drive at the bizarre junction of stardom, sleaze and wealth. "If you're writing about what a weird street this is, you're on the right track," said Jana Meek, a 73-year-old retiree who has lived there for a quarter of a century. "This is a cultural comedy." Justice Department officials assure that the cluster of seizure cases on Zumirez is just serendipity. In fact, it may have arisen from a chance collision of two trends in law enforcement: a scramble by criminals to launder their money with smart investments, and pressure on prosecutors to limit their zeal for real estate seizures to property that can be sold at a profit. "These are the houses they're going after--they're not interested in the '60 Nova, they're interested in the new Mercedes," said Richard Troberman, a Seattle attorney and co-chair of the National Assn. of Criminal Defense Lawyers' task force on forfeitures. "They're going to go after the ones that [will] bring them the most money." The government has long used its forfeiture power to seize all manner of ill-gotten property--from smuggled cargo in the 1780s to bootleg distilleries during Prohibition. After Congress expanded the power in 1984 to aid the war on drugs, seizures skyrocketed. Proceeds from the sale of forfeited assets routinely flow back to the agency that seized them, making the program popular with law enforcement. Proceeds to the Justice and Treasury departments exceeded $490 million last year alone. Federal seizures peaked in 1992, when the United States initiated action against more than 2,280 pieces of real estate in civil and criminal cases. But evidence of waste and mismanagement quickly mounted. Authorities took over homes, businesses and land that proved worthless or hard to maintain. A 78-acre Los Angeles-area horse ranch seized in 1989 was allowed to deteriorate for five years while under U.S. control, so that its appraised value slipped from $4.7 million to $523,000, according to government reports. And in perhaps the most notorious case, the government seized the Bicycle Club casino in Bell Gardens and held it for nine years, raking in profit even as the club's employees engaged in loan sharking and tax crimes. Amid a raft of abysmal audits, congressional criticism and bad press, leaders at the Justice and Treasury departments have redoubled their efforts to choose seizure targets more carefully and sell forfeited assets more quickly. Partly as a result, real estate seizures declined from about 2,075 in fiscal 1993 to 745 last year, documents show. Prosecutors also established a little-known set of guidelines to ensure they don't pursue properties that will ultimately lose money. With a few exceptions, prosecutors in Los Angeles won't pursue real estate unless the owner's equity is at least $40,000, or 20% of the property's value. 'Just a Bunch of Bad Eggs' By that measure, the elegant homes on Zumirez Drive made for near-perfect targets. Malibu's blazing real estate market has added equity to virtually every home, and rising demand means the U.S. could likely sell any house it seized there immediately--at a maximum profit. At the same time, Justice Department officials say, criminals increasingly tried to conceal their profits by pouring the money into legitimate purchases, such as real estate in a hot market. "If you're a criminal and you want to launder the proceeds, you . . . invest in a nice property that's going to appreciate," said a senior Justice Department official who spoke on condition of anonymity. "It's not a coincidence all these are in Southern California. It's a coincidence they're all on the same block." In January, the U.S. Customs Service auctioned off three 1,200-square-foot homes on the same street in Kissimmee, Fla., all seized from a Dutch national arrested for selling the hallucinogen ecstasy. But the four cases on Zumirez all arose from different investigations. "We really have to look at these cases in terms of potential liabilities for the government," said Dennis McKenzie, an analyst at the Treasury Department's asset forfeiture section. "One of the things we're not into is cleaning up the bad guy's personal liabilities," such as expensive mortgages or contaminants buried on the property. When criminals begin to profit from their work, "they see themselves as part of that elite class where they can party with the stars and the politicos," McKenzie said. "There are certain ZIP Codes that give them status, and these guys tend to migrate to that." But until whispers about indictments and warrants spilled into the street, the law-abiding residents of Zumirez Drive were none the wiser. In retrospect, however, they say, this much was clear: Folks living in the targeted houses made for lousy neighbors. One man's kid became a paparazzo who still pursues the street's more famous residents. Another allegedly cut down his neighbor's trees without asking. And a third violated basic Malibu etiquette by letting his lawn sprout weeds. Of course, some of Zumirez's more notorious residents--four men with criminal pasts--have their own stories to tell. Federal officials have so far settled one case, lost another and have two pending: * Gene Wall moved to the street in 1971, when the Malibu area called Point Dume was known less for its star-studded hideaways than its wild open space. The land "was just stark. Just brown, no trees, no nothing," he said. He changed all that. On the 1 1/2 acres he purchased for $59,000, he planted sycamore trees, corn and marijuana--which resulted in a conviction, and probation, on cultivation charges in the early 1980s. But the real trouble started a decade later. After a second raid--in which deputies shot his older son's pit bull and seized 152 grams of cocaine and other drugs--U.S. officials moved to seize his property. Prosecutors filed the claim on the basis that Wall hadn't prevented the son from selling drugs. A U.S. district judge found that forfeiture would be too harsh a penalty. Wall not only stayed, he also sued the county over the deputies' conduct and settled for $650,000. Now a silver-haired devotee of yoga, he still resides on the property with several tenants, six Rottweilers and a peacock. A man-sized replica of the Statue of Liberty stands atop the carport. And Wall's younger son now finds his father's Zumirez Drive address helpful--he's a paparazzo who takes pictures of the neighbors, including Streisand. Wall's explanation for the number of seizure cases on his street: "I just think a bunch of bad eggs ended up here at the same time." Prosecutors agree, and have taken action to seize three other properties down the street. * U.S. prosecutors say the owner of one house is Marc Johnson, also known in drug circles as "Prophet," according to an indictment in U.S. District Court in Brooklyn, N.Y. He stands accused of carrying out a conspiracy to import more than 60 tons of hashish on a tanker from Pakistan. Johnson couldn't be reached for comment. But Zumirez residents angrily recall how he allowed unsightly weeds to grow on the property while he was fighting extradition from Canada for three years. Assistant U.S. Atty. Burton Ryan contends Johnson funneled drug profits into a firm called Dume Properties--which owned the Zumirez house. Prosecutors who temporarily froze the property--with plans to pursue it later--didn't have to wait long for it to yield potential profit. Dume Properties found an interested home buyer following Johnson's capture, and prosecutors agreed to let it be sold on the condition that the proceeds be placed in an escrow account that could be forfeited later. The house sold for $650,000 to Dick Sittig, the former TBWA/Chiat Day advertising executive who developed spots for Jack in the Box restaurants and provides the voice for the Jack character. Despite its shadowy history, "we really wanted the property," said Sittig, who now runs his own Santa Monica ad agency and never met the previous owner. He said the house was "uninhabitable" when he first found it, with no plumbing or heat. "We don't care," he said. "It's all going to get bulldozed anyway." * A few mailboxes away lives Jack Stanley, who purchased a vacant lot on Zumirez five years ago for $536,759. A seasoned carpenter, he set out to erect a 4,100-square-foot home, a detached guest house and garage and a pool. But he never made it past the garage. Ventura County sheriff's deputies--following an informant's tip--appeared in July 1997, searched the property and seized Stanley's tax returns. Marijuana Profits Were Allegedly Used Authorities said Stanley had paid another man to run an indoor marijuana farm at a second home he owned, where deputies found 163 cannabis plants, vapor lights and other equipment. Stanley pleaded guilty to one count of cultivation and lost an appeal. Stanley's property easily met the government's 20% equity threshold--it had nearly doubled in value since he bought it, according to the U.S. estimate. Federal prosecutors filed a civil claim to seize the property, saying Stanley must have used marijuana profits to purchase it. Meanwhile, his wife was placed on the county's witness list in its case against a paparazzo pilot who buzzed too low over Streisand's wedding last year. Last month, Stanley settled the government's case by agreeing to pay $240,000 instead of losing his property. But his neighbor down the street may not be so lucky. * The Satmax Family Limited Partnership plunked down $2.4 million last fall for a cushy pad a few doors over from Streisand. Authorities now say the buyer behind Satmax is Kenneth H. Taves, who stands accused of one of the largest credit card scams in history. Regulators say Taves' companies billed up to 900,000 credit card holders for Internet services they didn't order, yielding him $45.5 million. A court-appointed receiver alleges that Taves tried to conceal the property by transferring the deed to a Canadian shell corporation shortly after regulators swooped down on him. Taves remains in custody in Los Angeles on related criminal charges. Jana Meek, the retiree who lives next door, said Taves first appeared in her driveway wearing a red leather motorcycle suit and offered to pay $10,000 if she'd let his children play on her tennis court. She declined. Later, she said, he sent a work crew to "butcher" at least half a dozen eucalyptus trees in her backyard in order to improve the view from his back window. Such encounters are more frequent, she said, "now that the Point has become well-known as the place to be." Some Zumirez Drive residents figure their street's quirks are ready-made for television. And they should know. "I almost wrote a sitcom called 'Zumirez Drive,' " said Eileen Penn, who has lived on the street for about 30 years and raised her actor sons, Sean and Christopher, there. "More people with more money are coming in now. That doesn't necessarily make it better." Since 1991, U.S. officials have tried to seize these four properties on Zumirez Drive.Pubdate: July 23, 1999 Copyright 1999 Los Angeles Times. All Rights Reserved Home Comment Email Register Recent Comments Help Comment #2 posted by FoM on July 23, 1999 at 18:52:26 PT: The Link Didn't Work So Here It Is! http://www.sfgate.com/cgi-bin/cgiwrap/cnews/article.cgi?file=/news/archive/1999/07/23/state1452EDT0037.DTL [ Post Comment ] Comment #1 posted by FoM on July 23, 1999 at 18:48:54 PT: Federal Authorities Target Four Homes! (07-23) 11:52 PDTMALIBU, Calif.http://www.sfgate.com/ (AP) -- Barbra Streisand, ``X-Files'' creator Chris Carter and composer Hans Zimmer are among those who live on a cul-de-sac here called Zumirez Drive, where they have a sweeping view of the Pacific Ocean. The same street is also home to several residents accused of narcotics trafficking, marijuana cultivation and credit card fraud. During the past nine years, federal authorities have tried -- with mixed results -- to seize four properties on the street. Click the link to read the complete article. Federal Authorities Target Four Homes on Malibu Street! [ Post Comment ] Post Comment Name: Optional Password: E-Mail: Subject: Comment: [Please refrain from using profanity in your message] Link URL: Link Title: