Couple Allegedly Owned and Operated Businesses in Las Vegas and Raton, N.M., and Kingman, Ariz., Used to Distribute Spice and Launder Drug Proceeds
ALBUQUERQUE – U.S. Attorney Damon P. Martinez and Special Agent in Charge Will R. Glaspy of the DEA’s El Paso Division, announced today that two former residents of Las Vegas, N.M., who recently relocated to Kingman, Ariz., have been indicted on drug trafficking and money laundering charges.
Ray L. Smith, 50, and Tamara Phillips, 47, are charged in a four-count indictment filed in the U.S. District Court for the District of New Mexico on Feb. 9, 2016. The couple was arrested in Kingman on Feb. 18, 2016, and made their initial appearances in federal court in Flagstaff, Ariz., on Feb. 19, 2016. During the judicial proceedings in Arizona, the court ordered the U.S. Marshals Service to transfer Smith and Phillips to New Mexico to face the charges against them. Smith and Phillips remain in federal custody pending detention hearings that will be scheduled after they return to New Mexico.
The indictment charges Smith and Phillips with participating in a conspiracy to distribute synthetic cannabinoids, more commonly known as “spice,” maintaining premises for the purpose of distributing spice, and participating in a conspiracy to launder drug proceeds. The indictment alleges that between Feb. 2010 and Feb. 2016, Smith and Phillips participated in a conspiracy to distribute spice from three businesses in New Mexico and Arizona that are owned by Smith and jointly managed by Smith and Phillips
According to the indictment, Smith and Phillips used the three businesses, “Smokin Body Jewelry” stores located in Las Vegas, Raton and Kingman, to sell spice. The indictment alleges that employees at the three stores sold spice to customers while acting at the direction of Smith and Phillips. The indictment includes information about two alleged drug transactions that occurred on Sept. 29, 2015: the first involved the sale of $1,687.46 of spice by an employee at the Raton store, and the second involved the sale of $1,556.91 of spice by an employee at the Las Vegas store.
The indictment includes forfeiture allegations which seek to forfeit property and other assets that constitute the proceeds of the drug trafficking offenses charged in the indictment or were used to facilitate those crimes including eight parcels of real property located in New Mexico and Arizona, funds in 18 bank accounts, a safety deposit box, and three vehicles.
The indictment is the result of a year-long investigation led by the DEA’s offices in Albuquerque, N.M., and Flagstaff, Lake Havasu and Yuma, Ariz., with assistance from the Raton Police Department and the Mohave Area General Narcotics Enforcement Team. During the course of the investigation, approximately one pound of spice was allegedly purchased from businesses operated by Smith and Phillips and approximately 22 kilograms (48 pounds) of spice was seized from a storage facility allegedly rented by Smith and Phillips.
During law enforcement operations executed on Feb. 18, 2016, law enforcement agents and officers seized 18 bank accounts, a safety deposit box and the eight parcels of real property identified in the indictment. They also executed six search warrants, including search warrants for each of the three stores, a second commercial property in Kingman, and two residences in Kingman. The estimated aggregate value of the real property, currency and other assets seized on Feb. 18, 2016, exceeds $2.3 million, including approximately $220,000 in cash. The agents and officers also seized approximately 11 kilograms (24.2 pounds) of precursor chemicals allegedly shipped from China in the primary residence of Smith and Phillips. In addition, approximately 25 kilograms (55 pounds) of suspected spice with a street value of $250,000 was seized from the stores and the residence of Smith and Phillips.
If convicted on the charges in the indictment, Smith and Phillips each face a statutory maximum penalty of 20 years in prison. Charges in indictments are merely accusations and defendants are presumed innocent unless found guilty in a court of law.
This case was investigated by the DEA’s offices in Albuquerque, N.M., and Flagstaff, Lake Havasu and Yuma, Ariz., with assistance from the Raton Police Department and the Mohave Area General Narcotics Enforcement Team. Assistant U.S. Attorney Shaheen P. Torgoley is prosecuting the case.
The synthetic cannabinoids charged in the indictment are commonly referred to as synthetic marijuana or “spice.” According to the DEA, over the past several years, there has been a growing use of synthetic cannabinoids. Smoke-able herbal blends marketed as being “legal” and providing a marijuana-like high have become increasingly popular because they are easily available and, in many cases, more potent and dangerous than marijuana. These products consist of plant material that has been coated with dangerous psychoactive compounds that mimic THC, the active ingredient in marijuana. These substances, however, have not been approved by the Food and Drug Administration for human consumption, and there is no oversight of the manufacturing process. Synthetic cannabinoids often are labeled as incense to mask their intended purpose.