August 20, 2012 in Region

Seattle pot parlors laundered illicit drug cash

Associated Press
 
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SEATTLE — Two people charged as part of the biggest crackdown on marijuana dispensaries in Washington state pleaded guilty to federal charges Monday, acknowledging their business was a front for an illicit drug distribution and money-laundering scheme.

Seattle residents Craig Dieffenbach and Jingjing Mo entered the pleas in U.S. District Court in Seattle on Monday. They face potential five-year mandatory minimum sentences but could receive significantly less time if they cooperate with investigators.

The pair ran two dispensaries under the name Seattle Cannabis Cooperative, which were among about 20 dispensaries raided by state and federal authorities last November. Authorities said the shops purported to be serving medical marijuana patients but were fronts for illicit drug sales.

At one point, Mo, with Dieffenbach’s knowledge, sold a pound of marijuana to a customer who turned out to be a DEA informant, they admitted in court. Mo also offered to sell 25 pounds for distribution in the Midwest — and suggested the informant buy lousy weed, under the theory that drug users there wouldn’t know the difference.

Dieffenbach had previously run into legal trouble of a different sort. He filed for bankruptcy protection after being sued for marketing vodka under the name of legendary guitarist Jimi Hendrix and agreeing to settle the case for $3.2 million. He declined to comment after the hearing Monday but asked a reporter not to write a story about the plea agreements because, he said, he could lose his job working for a Realtor.

Prosecutors are seeking to have about $25,000, a pistol and two rifles seized in the case forfeited to the federal government.

A defendant in another of the raids, Brionne Keith Corbray, was expected to plead guilty Monday afternoon.

The raids came at a time when several prominent residents of the state — including two former Seattle U.S. attorneys, John McKay and Kate Pflaumer, and the former head of the FBI’s Seattle office, Charlie Mandigo — had endorsed a ballot measure that would allow adults 21 and over to buy marijuana for recreational use at state-sanctioned stores.

Washington voters approved a medical marijuana law in 1998, and dispensaries have proliferated across the state in recent years. Last year, Gov. Chris Gregoire vetoed legislation that would have created a state system for licensing medical marijuana dispensaries over concern that it would require state workers to violate the federal Controlled Substances Act by inspecting marijuana grow operations, among other things.

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