“They knew it was medical hashish and that they might be seizing medical hashish proceeds, and they aren’t alleged to be spending any funds to try this.”
Robison all of a sudden pulls out into the left lane, accelerates quickly and inside a few miles pulls behind a white van, which instantly strikes onto the shoulder and stops. As he walks as much as the passenger-side window of the van, which seems to be an armored car, he tells dispatchers he believes the van has Colorado plates.
Robison tells the motive force he pulled her over as a result of the tag was partially obscured, then asks what she is hauling.
From this visitors cease, a sequence of occasions unspooled that resulted in additional than $1.2 million being seized in what an lawyer describes in a courtroom submitting as “the repeated and persevering with freeway robberies of armored automobiles by authorities brokers.”
The following day, Could 18, 2021, Robison once more stopped the van, this time seizing greater than $165,000. By that point, regulation enforcement officers had positioned tag numbers of automobiles owned by Empyreal Logistics, the armored car firm, right into a nationwide database that enables high-speed computerized license plate readers to scan visitors and spot the automobiles.
On Nov. 16, the San Bernardino County, California, Sheriff’s Workplace stopped one other Empyreal armored automotive and seized about $700,000. On Dec. 9, San Bernardino officers once more stopped an Empyreal armored automotive, this time seizing about $350,000.
The idea for the seizures? Based on Empyreal, the armored automobiles are transporting money from state-licensed marijuana dispensaries to monetary establishments, resembling credit score unions or banks.
“Shocked isn’t the half of it,” stated Dierdra O’Gorman, Empyreal’s founder and CEO, describing her response on studying that the cash from one of many firm’s armored automobiles had been seized in Kansas. “I’ve been a banker my whole profession—26 years within the banking business.”
After the California seizures, Empyreal filed a federal lawsuit towards a number of regulation enforcement companies demanding the federal authorities cease these “freeway robberies.” On Monday, the courtroom denied Empyreal’s request for a short lived restraining order.
“The courtroom is compelled to precise its issues relating to Empyreal’s litigation techniques,” District Choose John W. Holcomb wrote.
Holcomb suggested attorneys for Empyreal to cease slicing procedural corners and reminded them of their obligation to be candid with the courtroom.
Info gathered from interviews, courtroom paperwork, police experiences, and a viewing of the dashboard digital camera video expose battle between federal and state legal guidelines relating to marijuana, and the eagerness of regulation enforcement officers to justify their urge to “smash” Empyreal into submission.
Dealing with marijuana cash
O’Gorman established Empyreal in June 2018 within the Denver space. As we speak it operates in 28 states.
“I made a decision to begin Empyreal with hopes of making an attempt to repair a number of the challenges that I skilled on the opposite facet of the service mannequin, being a monetary establishment working with armored automotive firms,” O’Gorman stated. “I’ve prided myself on my profession being centered on compliance and serving to monetary establishments with their Financial institution Secrecy Act and Anti-Cash Laundering [Act] compliance. It’s been all the things that we do and each a part of the equation for us, ensuring that we’re following the foundations.”
O’Gorman stated many individuals suppose there aren’t any banks or different monetary establishments that can settle for cash from marijuana dispensaries. There are a lot of that can—at the very least 700 nationwide, she stated—however the banks impose rigorous reporting and record-keeping necessities.
“It’s a reasonably hefty compliance listing,” she stated.
There are background checks, verification of the place cash comes from and the place it goes, and monitoring of who will get paid.
“All of these items are scrutinized at a stage that in my 26-year banking profession I’ve by no means seen earlier than,” she stated.
O’Gorman stated she is cautious to work solely with monetary establishments that comply with these stringent tips.
The seizures by regulation enforcement come up from the truth that whereas 18 states have legalized leisure marijuana use, and its medicinal use is authorized in 36 states, the federal authorities nonetheless considers each medicinal and leisure marijuana use unlawful.
So does Kansas.
Seizing money, automobiles and weapons passing via Kansas has develop into a high-stakes exercise. Based on Kansas Bureau of Investigation knowledge, Kansas regulation enforcement companies since 2019 have seized $8 million, practically all from motorists, with the Kansas Freeway Patrol accounting for half of the forfeitures.
That’s from solely the instances which were resolved. It will possibly take years for the disposition of seized money and automobiles to be decided, and it’s not till disposition that particulars are reported to the KBI.
Civil forfeitures are a course of that enables regulation enforcement companies to grab money, automobiles, private property, actual property and weapons they believe have been concerned in against the law. They don’t need to arrest the proprietor or convict them of against the law. Half the cash seized in Kansas since 2019—greater than $4 million—was forfeited with out a prison case being filed, based on knowledge supplied by the KBI.
Officers want solely display a connection between the property and against the law. However they’re alleged to have a authentic purpose for making a visitors cease.
“The Fourth Modification requires at the very least affordable suspicion or possible trigger to cease a car,” stated Dan Alban, senior lawyer with the nonprofit Institute for Justice, which helps symbolize Empyreal within the California lawsuit. “The best way freeway interdiction works is you get behind the car and also you provide you with the excuse to tug it over… In the event you comply with somebody lengthy sufficient, they will commit some minor visitors infraction.”
Confusion over drug legal guidelines
A request filed below the Kansas Open Information Act for copies of experiences and recordings made by the dashboard digital camera had been partially granted. There was no offense report written for the Could 17 cease, however a replica of the offense report for the Could 18 cease and seizure was supplied, and a reporter was allowed to view the recorded video.
Throughout the first cease, it didn’t take Robison lengthy to tug over the Empyreal van. And he wasted no time asking the motive force what was within the van, and the place she was going. The driving force shortly defined she was on her option to decide up money from marijuana dispensaries in Missouri and drive it again to Colorado.
She defined precisely how the cash is saved and invited Robison to see the within for himself. O’Gorman stated all the corporate’s drivers bear in depth coaching in methods to work together with regulation enforcement. The corporate’s chief of operations is a former sheriff.
“We’re very clear about what we’re doing,” O’Gorman stated.
A basic objective is to assist regulation enforcement perceive the aim of her armored automobiles.
“We all know that it’s an advanced patchwork of guidelines and laws,” she stated. “We wish to guarantee that everyone understands.”
On this case, that effort was not profitable. The driving force’s candor set off a flurry of calls between Robison, the Drug Enforcement Administration and the U.S. Lawyer’s Workplace in Wichita, which could be heard on the video recording.
After some preliminary head-scratching, Drug Enforcement Administration agent Bryson Wheeler admitted to be puzzled.
“I don’t suppose that’s essentially unlawful,” he advised Robison. “It’s simply unusual as hell. It looks as if they’re a financial institution working as not a financial institution.”
The authorities are conscious that medicinal marijuana is authorized in Missouri, however a couple of minutes later Wheeler throws out a purpose why the exercise is prohibited.
“Wheeler calls officer Robison and claims that hashish proceeds should keep within the state the place hashish is authorized and can’t be transported throughout state traces,” stated David Bass, a former deputy lawyer common in California who labored within the Monetary Fraud and Particular Prosecutions Unit, in a declaration filed on behalf of Empyreal within the California lawsuit. “That is incorrect. Primarily based on my skilled expertise, there is no such thing as a regulation indicating that proceeds develop into unlawful once they go away a state.”
Within the telephone name to Robison, Wheeler continues to attempt to provide you with a option to determine precisely what is illegitimate in regards to the armored automotive taking cash from Missouri companies to deposit in a monetary establishment in Colorado.
At one level within the dialog, “Wheeler claims that Empyreal’s operations are bulk money smuggling,” Bass stated in his declaration.
O’Gorman stated the confusion by regulation enforcement is precisely what the coaching of the corporate’s drivers is meant to keep away from.
“We solely work with monetary establishments…that supply providers to hashish companies,” she stated. “We’ll have Empyreal go decide up the funds after they’ve been validated by the financial institution or credit score union, after which we carry these funds again to monetary establishments. So we’re working with them solely after the entire due diligence has been performed to guarantee that these funds got here from lawful…gross sales.”
She was baffled by the cash laundering hypothesis.
“In the event that they thought there was cash laundering occurring, why wouldn’t they’ve contacted the monetary establishment?” she requested. “Why wouldn’t they’ve confiscated the funds on the enterprise?”
‘Smash them into submission’
The conversations between Robison and Wheeler turned animated as they reassured themselves this was a genuinely unlawful operation, and it was clear Empyreal’s armored automobiles had been ferrying money in half the states within the nation.
They mentioned placing tag numbers from Empyreal’s armored automobiles right into a nationwide database that enables regulation enforcement officers to make use of high-speed license plate readers to identify Empyreal vans throughout the nation.
“Smash them into submission,” Wheeler stated.
Bass described a number of the dialog in his declaration.
“After deciding to position all of Empyreal’s automobiles into the [license plate reader], agent Wheeler notes that Empyreal will struggle the seizures, however regulation enforcement ought to ‘crush each one among their automobiles that they’ll determine,’ ” Bass stated. “Agreeing with agent Wheeler’s plan, across the 36:50 mark of the recording, officer (Robison) states, ‘We’ll begin taking all of them down without delay.’ ”
Robison then advised the Empyreal driver she was free to go, however not earlier than volunteering to take away the offending license plate body.
The following day, because the van headed again to Colorado after making stops to select up money from Missouri dispensaries, Robison pulled the van over close to the Enterprise exit on I-70. The visitors cease took practically three hours. The sheriff’s workplace seized 5 baggage of money that, based on the offense report filed in reference to the case, contained $165,855.
Harming authorized enterprise
Alban, the Institute for Justice lawyer, hopes to indicate the DEA failed to remain in its lane.
Federal regulation prohibits the U.S. Division of Justice—the father or mother company of the DEA and FBI, amongst others—from spending cash to stop states from “implementing their very own state legal guidelines that authorize the use, distribution, possession, or cultivation of medical marijuana.”
The prohibition was initially generally known as the Rohrabacher–Farr Modification and have become regulation in 2014. The restriction has been hooked up to DOJ funding yearly since.
“I feel on this case [Rohrabacher-Farr] presents a extremely significant issue for them as a result of they knew from the time of the Could 17 cease that the motive force was going to go to medical hashish dispensaries in Kansas Metropolis, Missouri,” Alban stated. “They’ve the names of these dispensaries on the manifest. They need to have identified that Missouri doesn’t have leisure hashish. The one hashish dispensaries working legally with a state license in Missouri are going to be medical hashish dispensaries.”
The Kansas Metropolis Star reported in November that the manifest for the journey lists 4 medical marijuana dispensaries in Missouri: BesaMe Wellness in Smithville and two From the Earth places in Kansas Metropolis and one other in Independence.
The truth that the cease was in Kansas, which has not legalized marijuana use, is of no consequence, Alban stated, as a result of irrespective of the place the seizure takes place, it harms legally working hashish companies.
After the Could 17 cease, “they went and did the surveillance on Could 18 in Kansas Metropolis of the Empyreal car choosing up the proceeds from these dispensaries,” Alban stated.
“From the very get-go, they knew it was medical hashish and that they might be seizing medical hashish proceeds, and they aren’t alleged to be spending any funds to try this, together with spending cash on surveillance outdoors of medical hashish dispensaries in Missouri,” Alban stated.
On September 3, 2021, the U.S. Lawyer’s Workplace filed a civil forfeiture case in federal courtroom in Kansas Metropolis, asking the courtroom to let it hold $165,620 taken from the Empyreal armored automotive.
Requests for interviews with regulation enforcement officers had been refused. The Dickinson County Sheriff’s Workplace stated the case has been turned over to the Drug Enforcement Administration. A DEA spokesperson directed all inquiries to the U.S. Lawyer’s Workplace.
Danielle Thomas, public info officer for the U.S. Lawyer’s Workplace in Wichita, declined to reply any questions.
“We don’t talk about open instances,” she stated.
This story was first published by Kansas Reflector.
How a Kansas traffic stop led to a federal lawsuit over $1.2M in seized marijuana profits
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