Kevin Fujii / Chronicle The Hub at 312 Main is one of two downtown nightclubs officials say were bought with funds generated by a Houston Ecstasy-trafficking ring that has been called the biggest Ecstasy operation in the world.
Posted on 09/23/2002 3:49:46 PM PDT by weegee
Shaped like clovers, festooned with Playboy bunnies and popular cars, the colorful little Ecstasy pills that landed the owners of two popular downtown clubs in jail last week started their march to Houston in clandestine, rural laboratories in the Netherlands.
Chemists, sometimes working out of large, sophisticated buildings, sometimes mobile laboratories, have churned out as many as 500,000 Ecstasy pills an hour for a mere 20 cents each, making the Netherlands, a country known for its liberal attitude toward the illegal pursuit of happiness, one of the major worldwide producers of Ecstasy.
Last week's charges against 24 people in Houston and 10 others broke up what federal authorities described as the world's largest Ecstasy-trafficking ring. Arrests ranged from Israel, where police say an organized crime group masterminded the smuggling, to the production headquarters in the Netherlands, to Spain, where sources say Houstonian Sarabjeet "Rick" Singh was expanding the Ecstasy ring into that country's vibrant club scene.
Singh, who remains at large in Spain, and his brother Amrik "Spiro" Singh are also charged with opening the clubs Spy Club and The Hub to launder drug profits, an estimated $7 million.
Ecstasy, a stimulant and mild hallucinogen, is mostly sold to teenagers and young adults at dance clubs, high schools and colleges across the United States. Ecstasy users dance for hours, mesmerized by the pulsing beat and flashing lights of the techno clubs where it is often consumed.
The pills were not sold at Spy Club and The Hub, authorities say, but instead snaked through a chain of dealers in Houston and other U.S. cities before being sold to consumers for about $20 per tablet. In fact, Spy was known for its intolerance of illegal drug sales, two people familiar with the downtown club scene said.
The clubs remain open under a federal protective order.
Most of the Ecstasy in the United States is brought by Israelis and Russians, according to a National Drug Intelligence Center report on Ecstasy. Many of the traffickers are Russian-born immigrants to Israel or the United States, and are typically young and well-educated, the report says.
Ecstasy is typically made in the Netherlands and Belgium. The drug is illegal in both countries, even though the Netherlands is known for an over-the-counter drug culture in which marijuana and hashish can be purchased at "coffee shops."
Air, sea and rail connections from the Netherlands and Belgium to the rest of Europe and the United States make them convenient sites for drug trafficking.
Ecstasy tablets have been smuggled into the United States as many as 300,000 at a time in gas tanks of imported BMWs, boxes of blue jeans shipped as cargo and sewn into the clothes smugglers were wearing. An 81-year-old woman in a wheelchair, a couple traveling with a handicapped teenage son, and a group of Hasidic Jews all have been caught smuggling Ecstasy.
Drug traffickers also use false bottoms in suitcases, swallow thousands of tablets in condoms and send Ecstasy through the mail and courier services.
"It's up to the smugglers' imagination," said Dean Boyd, a spokesman for the U.S. Customs Service.
Ecstasy is relatively easy to smuggle because of its compact size. Drug dogs have been trained only in the last few years to identify its sweet smell, Boyd said.
Once the pills are in the country, they are sold to wholesalers in quantities of hundreds of thousands, to midlevel dealers in amounts of about 1,000 at a time and then to the retail dealers who hawk dozens or hundreds of the pills directly to users.
Authorities say Gal Kofferberg of Houston sold vast quantities of Ecstasy to the Singh brothers, who led the Houston-based portion of the drug ring.
Kofferberg, Spiro Singh and a third brother, Amarjit Singh, were arrested in Houston on Tuesday.
Rick Singh is wanted in Spain, where a knowledgeable law enforcement source said he had been living for at least several months while expanding the Ecstasy ring.
Defendants in the Ecstasy ring also were arrested in Miami and Los Angeles, which also have active drug and club scenes.
Spy Club, 112 Travis, and The Hub, 312 Main, are both sleek nightspots geared toward 20-something crowds. Authorities say both businesses were bought with drug money, but they would not say whether the Singhs continued to flush dirty money through the clubs after they were open.
Spy employees often would show up at private parties with extra liquor to give away, said one person familiar with the downtown club scene.
"I've been wondering how Spy has stayed alive for years because it doesn't have the crowd, it's not making money," the person said.
Mike Snow, a disc jockey at Spy for five years, said Spy has four busy nights, while most downtown clubs have only one.
"Spy has legitimately been making the money," Snow said.
Spy, an 18-and-older dance club, and The Hub, a bar, remain open, but their profits are frozen until the case goes to trial. If the Singhs are convicted, the money and the clubs will be seized by the federal government. If not, they will be returned.
The Singh brothers frequented Spy on weekends. People who know them through the club scene described Spiro Singh as laid back and Rick Singh as more of a "hothead."
Rick Singh traveled with bodyguards and "real fast-looking, trendy girls," those people said. Both drove expensive cars. Rick Singh put down $20,000, including $7,000 cash, for his $96,000 Jaguar, the indictment against him says.
Three Singh family houses far from the flashy downtown club scene, both in style and distance, are also subject to government seizure.
The federal government could seize $7 million in property, the amount authorities believe the Singhs made from the drug business, U.S. Attorney Michael Shelby said.
Their houses are sheltered deep in the winding, quiet streets of suburban northwestern Houston, near West Road and Beltway 8. Two of the three have manicured lawns, with children's bikes at one and a miniature basketball hoop at the other. Both Indian families have posted "Proud to Be an American" signs in the yards and American flags on the pragmatic -- and low-profile -- Toyota Camrys and Honda Accord in the driveways.
The third house, in the same area, had a "For Sale" sign out front two days after the arrests, and neighbors said it had been vacant for months.
Residents in suburban neighborhoods around Houston also are familiar with the drug. With its relatively low price tag and harmless image -- contested by authorities -- Ecstasy is popular among the teenagers who live in conventional communities like the Singhs'.
Kevin Fujii / Chronicle The Hub at 312 Main is one of two downtown nightclubs officials say were bought with funds generated by a Houston Ecstasy-trafficking ring that has been called the biggest Ecstasy operation in the world.
Feds bust up Ecstasy ring - Say clubs laundered money (Houston TX: Spy, Hub)
The pills were not sold at Spy Club and The Hub, authorities say, but instead snaked through a chain of dealers in Houston and other U.S. cities before being sold to consumers for about $20 per tablet. In fact, Spy was known for its intolerance of illegal drug sales, two people familiar with the downtown club scene said.
Sounds like they didn't like the competition or didn't want to jeopardize their investment in the club.
What's odd is that the clubs are being permitted to keep operating while a club on the edge of downtown is getting hounded out of business:
Some members of Houston's city council have defended Spy against neighborhood complaints saying that those who don't like the noise or activity should consider moving to the Woodlands. It's all about who you know (or tick off).
Police hired to work security for Spy did their job to squash some of the complaints. I'd be interested in knowing the number of "police calls" that were made to Spy.
Death to the commie-punk drug-fiends,hic. Now its your turn to make a toast.
I knew it was bad over there but I had no idea it was that bad!
After 25 of legalized drugs, we are turing the other way. The left promised it would stop a lot of crime and so on, but it never happened. Only criminals benefitted.
The Netherlands take top spot in crime + Left gave crime a chance
The legalization of marijuana would theoretically lower violence as well. Since no one would have to be shady about retrieving marijuana, violence wouldn’t need to be used! Most violence is used on the streets with those making drug deals and trades. They use violence to obtain marijuana or to keep people’s mouths shut about the drug dealing.
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