18 People Charged Running Marijuana Operation in Calif.
SACRAMENTO, Calif. – Federal prosecutors in California have charged 18 people with operating an extensive marijuana-growing operation by converting upscale homes into high-tech pot nurseries.
U.S. Drug Enforcement Administration agent Casey McEnry said all are from the San Francisco Bay area. Nine were arrested early Thursday on drug and real estate fraud charges. The others remain fugitives.
Federal authorities estimate the operation could bring in nearly $100 million a year.
Police and drug agents found about 24,500 marijuana plants growing in 50 converted Central Valley homes in Elk Grove, Lathrop, Modesto, Sacramento, Stockton and Tracy in 2006-07.
"We estimate that on an annual basis these homes could have produced nearly 11 tons of high-grade marijuana worth an estimated street value of $96 million," said Gordon Taylor, who heads the DEA's Central Valley office. "Average price for high-grade marijuana on the street is $4,000 per pound, and it's even more than that if you buy marijuana by the ounce at the dispensaries here in California."
There is no evidence marijuana from the houses went to medical marijuana dispensaries, Taylor said.
The operators punched out walls, installed expensive ventilation and hydration equipment and tapped power lines to grow thousands of plants in the upscale suburban homes. Agents said the growing systems alone cost tens of thousands of dollars for each home.
Officer Chris Trim of the Elk Grove Police Department south of Sacramento said it took federal agents and Internal Revenue Service investigators three years to work their way up the chain and through real estate documents.
"Any time you're dealing with a level of operation that's very sophisticated, it's going to take time," Trim said. "They were able to track down those persons that were directly responsible."
Federal authorities initially charged 17 people caught at or near the grow houses, and state officials brought charges against other lower level offenders.
"They were almost the gardeners, the caretakers of the growing operations," Trim said. "The level they're at now...I'm sure it's going to be a significant impact on that operation."
The investigation "led to the involvement of possible organized crime," Trim said.
Gordon previously said the grow houses appeared connected to a San Francisco-based organized crime syndicate.
The growers bought homes for $400,000 to $600,000, most in subdivisions that were new or a few years old. The Central Valley's housing market has since crashed, substantially lowering the value of most homes. In many cases, real estate records show the buyers abandoned the homes after the drug raids.