Grow houses part of business-like scheme, officials say
By Sarah Prohaska
Palm Beach Post Staff Writer
Thursday, September 21, 2006
It was a high-stakes investment with promises of a payoff so enticing, dozens of people moved to St. Lucie County to take a very serious risk.
They were lured by an opportunity to live in Florida with all expenses paid and a steady income. They wouldn't have to put up a dime of their own money for a middle-class home in suburbia. After two years, if they wanted out, the house would be put up for sale and they would get 50 percent of the equity.
Most of these homes were nestled in quiet neighborhoods in Port St. Lucie, one of the fastest-growing cities in the U.S., where home values have been on the rise the past few years. Any home sold could mean a handsome profit.
In exchange, they had to do one thing: Grow marijuana secretly inside the home for two years.
That was how federal prosecutors and investigators described Wednesday the alleged scheme behind the largest marijuana-growing operation in Treasure Coast history, an operation of unprecedented proportions even on a national scale, some experts say.
The scheme's unraveling began in May when Port St. Lucie police responded to a report of a machete-wielding man chasing another man down a quiet residential road. Police didn't find the men, but they discovered the first of what grew into 59 homes that had been converted into elaborate marijuana farms.
To date, they have found 3,602 marijuana plants in the homes, with an estimated street value of more than $50 million.
The discoveries set off an investigation that included state and local police, the U.S. Drug Enforcement Administration, the U.S. Attorney's Office and the Internal Revenue Service. Systematically, investigators traced one home to another based on documents and photographs found in the homes, according to reports. Many of the homes were set up identically, officials said.
R. Alexander Acosta, U.S. attorney for the Southern District of Florida, on Wednesday disclosed the basics of the alleged scheme, including investigators' belief that the grow houses were financed by a business in New Jersey. Because the investigation is continuing, Acosta and other investigators refused to reveal the name of the business, the city in which it operated or how long they believe the marijuana-growing scheme has been in the works.
"We have effectively dismantled a well-organized and well-financed marijuana grow house operation with tentacles that stretched from South Florida to New Jersey," Acosta said in Fort Pierce. "People associated with the New Jersey business were offered a relocation package to the St. Lucie area."
In exchange for a free home for two years with all expenses paid, the participants were required to tend the marijuana plants, he said. The organization made arrangements to harvest the plants and start a new crop two or three times a year, Acosta said.
Once harvested, each plant was worth about $4,000, and the homeowners received $1,000 per plant, officials said. Each home generated between 34 and 322 plants, which yielded between $136,000 and about $1.3 million for each harvest.
Some homes, Acosta said, generated up to four harvests a year.
DEA Special Agent Jeannette Moran said she had never seen such a large marijuana-growing ring in her 15 years working for the agency. She checked with an agent in Los Angeles — better known than tiny Port St. Lucie for its drug operations — and that agent also had never heard of such volumes of pot.
"I can't think of a time we've had so many all tied to one organization," said Moran, who is based in Miami. "I don't recall any organization that operated like this. It's a business."
So far, 62 people have been arrested and charged in state court in connection with the grow houses. Federal officials unsealed indictments and criminal complaints Wednesday against 35 of them, transferring those cases to federal court, where the suspects face conspiracy and marijuana cultivation charges.
Several of those charged in federal court have previous addresses in New Jersey just outside New York City.
Assistant U.S. Attorney Beth Streenan said four of those people were taken into custody in New Jersey and one in Orlando. The federal charges carry a maximum penalty of 40 years in prison and a $2 million fine.
She wouldn't comment on the possibility of the other cases being transferred to federal court, citing the ongoing investigation. Investigators and prosecutors also were tight-lipped about the possibility of future charges against those involved in the New Jersey organization.
"We will continue to investigate with the goal of identifying, arresting and prosecuting all those responsible for finding and financing the homes, preparing the homes for cultivation of marijuana and harvesting and distributing the marijuana," Acosta said.
Still, many who have followed the story of the grow houses have been left wondering: Why Port St. Lucie?
Police Chief John Skinner had a guess.
"You've got all these quarter-acre lots. A lot of new communities," he said. "It's just an easy place to blend in."
The investigation, headed by federal prosecutors, relied on a dozen investigators: seven Port St. Lucie police officers, two DEA agents and three IRS investigators. Port St. Lucie Police Sgt. Todd Schrader said the IRS extensively investigated the real estate and tax sides of the operation.
"They are as familiar with the officers around our office as we are," Schrader said.
Larry Holifield, the area's DEA associate special agent in charge, said there was a lesson to be learned: No one should buy into a scheme where the outcome looks too good to be true.
"They enticed people to come down here with the promise of the American dream — a home," Holifield said. "If something seems like it was handed to you on a silver platter, think twice."