Wednesday, September 21, 2005

IRS to auction condos seized from smugglers

Affordable housing advocate urges Ketchum to bid on properties

Three condominium buildings in west Ketchum will be sold at auction Oct. 4 by the Internal Revenue Service in what federal agents say is the end of a nearly 10-year-long investigation into an international drug-smuggling ring.

The Bavarian Village condo units were among $4 million worth of assets forfeited by Patrick Cannon of Ketchum and David Brocklebank of Hailey when they were sentenced to 40 months in prison in February 2004 on charges of money laundering and conspiracy to smuggle and distribute drugs.

The pair were part of a Thai marijuana smuggling investigation that federal agents began in 1997 in Idaho and which eventually spread to include law enforcement agencies in Hawaii, California and Washington, as well as agencies in Europe, Asia and the Caribbean.

In plea agreements filed with U.S. District Court in Boise, the two men admitted being part of loosely connected international drug trafficking rings with ties to Sun Valley that had operated since the 1970s. Using yachts, shell corporations and foreign and domestic banks, the rings imported tons of marijuana from southeast Asia into the United States and laundered proceeds through various business ventures.

"What most people don't realize is that money laundering activities, such as the ones identified in this investigation, assist narcotics traffickers in the continuation of their illegal actions and allow them to enjoy the fruits of their crimes," Douglas Bricker, special agent in charge of IRS criminal investigation in Idaho, said in a statement Friday.

Besides Cannon and Brocklebank, Michael and Paul Miller of Ketchum were also convicted in the smuggling investigation and forfeited more than $8 million worth of seized property. Last year, the Ketchum Police Department and the Blaine County Sheriff's Office each were given nearly three-quarters of a million dollars as their share of the proceeds from the forfeited property.

A portion of proceeds from the auction of the 14 condos previously owned by Cannon and Brocklebank also will likely be given to local law enforcement agencies, said Jean McNeil, spokeswoman for the U.S. Department of Justice in Boise.

The 14 units in the three buildings, at 106 and 110 Rember St. and 154 Bird Drive, include a mix of studio and one- and two-bedroom units. They will be auctioned together in one sale. The IRS announcement of the auction says the buildings represent "an excellent redevelopment opportunity" and that new high-end condominiums in the areas are selling between $800,000 and $1 million per unit.

Affordable housing advocates told the Ketchum City Council Monday, Sept. 19, of their interest in acquiring the units.

"We have a critical economic need for workforce, affordable housing in Ketchum," Rebekah Helzel, founder and director of Advocates for Real Community Housing, said. "I can't tell you how important this is. We're losing businesses, we're losing local option taxes (because of housing prices)."

The units currently rent for less than market rate.

The council wants more information—including how much it would cost to upgrade the units—from Helzel and Michael David, executive director of Blaine-Ketchum Housing Authority.

"A lot of factors need to be considered before we commit resources," said Mayor Ed Simon.

The city has $400,000 for affordable housing purchases, and will be receiving nearly $1 million more from in-lieu payments.

IRS auction Oct. 4

The auction of the Bavarian Village condo units in Ketchum will take place at the condominiums at noon Oct. 4. Bidders can register an hour prior to the auction by depositing a $100,000 cashier's check.

Potential buyers can preview the property on Sunday, Sept. 25, and Sunday, Oct. 2, from 1-4 p.m.

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