"It's Strictly Business": Inside the Prohibition Racket

In addition to being an engine of misery, corruption, and bloodshed, the War on Drugs should be seen as a multi-tiered criminal enterprise.

At the top echelon are found the political figureheads who recite pious bromides. That’s likewise where we encounter the bureaucratic scribes responsible for crafting those cynical pronouncements and the legislation that gives them substance. The operational level consists of federally subsidized, hyper-aggressive law enforcement agencies that carry out military-style raids and seizures. This includes squalid undercover police operatives and the petty criminals who act as “cooperating informants,” as well as the strutting armored sociopaths who act on that “intelligence” by terrorizing people in home invasions that are typically carried out before dawn or after sunset.

Beneath the lurid violence of narcotics enforcement can be found the gray, undistinguished local bureaucrats who are actually in charge of such task as stealing property said to be “connected” to drug trafficking, caging the people from whom it was taken, and dividing up the spoils. Official transcripts from several meetings of Oregon’s Malheur County Commission provide useful insights regarding the retail-level business of that vertically integrated criminal enterprise.


The Malheur County War: SWAT raiders arrest a drug suspect.
For nearly two years, the Malheur County DA’s office, working in collaboration with the federally syndicated High Desert Drug Enforcement task force, has been milking revenue out of a September 11, 2012 raid on the 45th Parallel, which was a medical marijuana dispensary located in Ontario, Oregon.

Police raids were carried out against both the co-op and more than a dozen “grow sites” in both eastern Oregon and western Idaho. A total of eighteen people were eventually charged with “conspiracy” to provide medical marijuana “for consideration,” under a version of the Oregon medical marijuana law that is no longer in effect.

During an April 9 meeting of the Malheur County Commission, Deputy District Attorney Michael Dugan, an ardent prohibitionist, explained that “Under Oregon law at that time you could not sell marijuana even to another medical marijuana participant.” (Emphasis added.)

“You have to have an enterprise or an organization,” elaborated Dugan to commissioners Don Hodge and Larry Wilson. “An enterprise can be a for-profit [or] a non-profit corporation, it can be a business, it can be an association however loosely assembled.” It isn't necessary to be directly involved in a specific illegal act in order to be “wrapped up in the RICO,” Dugan told the two commissioners. In fact, “it could be the three of us if we associated to do something illegal.”


Dugan at a press conference, September 2012.
The purpose of the April 9 meeting was to persuade commissioners to continue funding the prosecution of William Esbensen and Raymond Kangas, the co-founders of the 45th Parallel, who were the final defendants in the case. On June 6 they were found guilty in a bench trial of conspiring to provide medical marijuana “for consideration,” despite the fact that the statute under which they were prosecuted was dead-letter law.

Interestingly, in an earlier jury trial two other 45th Parallel defendants, Kelly and Kerry Rhoan, were found guilty on two RICO counts but acquitted on “conspiracy” charges.

That verdict “kind of makes me cross my eyes because in order to have a RICO you have to have … an agreement to associate, and conspiracy is an agreement to commit crimes,” Dugan recounted to the Malheur County commissioners. Somehow, the only jury that rendered a verdict in the 45th Parallel case ruled that the defendants had created an association to do something that wasn’t considered a criminal act – in this case, to distribute a legally recognized palliative medicine to people who needed it.

As it happens, the purpose of Dugan's presentation on April 9 was to entice the commissioners into underwriting what amounted to a highly lucrative illicit enterprise: Prosecuting a RICO case without a clearly established “predicate offense,” through what appears to be a fraudulent county contract with the DA’s office, in collusion with a District Judge who had obliquely indicated her willingness to inflate the charges in order to impose draconian fines that would translate into larger profits for the county.

During the September 2012 raids, Dugan boasted, “we recovered” – that is, his armed accomplices stole at gunpoint – “a number of huge globs of money so to speak.” Among those “globs” was $53,000 in cash that was seized at Esbensen’s home in Boise, money that had no proven connection to the 45th Parallel. That stolen money “was subject to federal forfeiture,” which means it was available for “equitable sharing to … local law enforcement.” The Malheur County Sheriff’s office “received about 40 grand of that; [Sheriff Brian Wolfe] could tell you more exactly, but that goes into his forfeiture fund.”


This was explained, once again, during the April 9 commissioners’ meeting. Roughly two weeks later, Malheur County DA Dan Norris reported to the commission that $15,000 from the Sheriff’s forfeiture fund would “contribute to Mr. Dugan’s employment costs.” What this means, of course, is that the money stolen by Mr. Esbensen without due process of law would be used to fund his prosecution on charges filed under a law that was no longer in effect.

Norris asked the commission to provide “an additional $15,000 from [the] General fund to continue to contract with Mr. Dugan” and said that he would “generate additional funds needed” to underwrite the 45th Parallel prosecutions, which would cost “a total of $40,000.” How would the prosecutor “generate” the additional funds? Would he hold a bake sale, perhaps? Of course not: He “requested [that] monies from anticipated judgments in the 45th Parallel case be put into the revenue side of his budget” – in other words, that the prosecution would proceed in the expectation of additional forfeitures and fines.

Continued at....freedominourtime.blogspot.com/2014/07/its-strictly-business-inside.html