Bal Harbour police

Bal Harbour cops spent lavishly with seized drug loot

 

The Bal Harbour Police Department is under scrutiny not only for how it seized drug money, but how it spent the money.

dchang@MiamiHerald.com

Flush with millions of dollars seized from drug dealers, Bal Harbour police financed a freewheeling spending spree: $3,200 for a Miami-Dade police chiefs golf outing at Miami Shores Country Club; $1,000 for two nights’ stay at the Ritz Carlton Hotel in San Juan, Puerto Rico; and thousands more in sumptuous meals at Carpaccio Restaurant in the Bal Harbour Shoppes.

There were trips galore to Home Depot and Party City, for items such as cooking fuel and folding tables and chairs; to Publix and BJs Wholesale Club for food platters, dessert trays and picnic supplies; to BrandsMart USA for a flat-screen TV, a microwave oven and other appliances.

What did these expenses have to do with the department’s duty of serving and protecting Bal Harbour?

Little to nothing, according to the findings of an investigative report released last week by the U.S. Department of Justice that slams a Bal Harbour police task force that traveled the country picking up drug cash and laundering it during undercover investigations. The Justice Department said the task force laundered more money for criminals than it seized, and made no significant arrests or prosecutions — but spent the cash it did seize lavishly on salaries and benefits for officers, exceeding government spending guidelines with first-class flights, luxury car rentals and posh lodgings during undercover operations.

Catered DUI stops

Even when police were not working undercover, they tapped federal forfeiture funds to buy hundreds of dollars worth of pizzas, sodas and snacks for Mothers Against Drunk Driving events or Crime Watch meetings, and they pulled out all the stops for DUI checkpoints, which frequently became occasions for catered cookouts for the cops, according to Bal Harbour credit card statements.

Expense records show Bal Harbour police routinely spent hundreds and sometimes thousands on party supplies and other items that had little to do with actual law enforcement, such as $1,500 worth of Apple iPads and accessories purchased at the Aventura Mall in August 2011 for a drug-prevention event.

Bal Harbour officials have declined to comment on the array of purchases made under Police Chief Thomas Hunker, who is accused of professional misconduct in the Justice Department’s investigative report. He was suspended with pay by the village last week.

Bal Harbour’s mayor, Jean Rosenfield, said she will reserve judgment on Hunker pending the outcome of an investigation into related allegations that the chief sold his influence for gifts, interfered with arrests and prosecutions, and landed a deal on his wife’s personal Jeep after the police department bought several vehicles from the same dealership.

“People can allege anything,’’ she said. “I want to know where these allegations came from.’’

However, some Bal Harbour residents said they are outraged by the Justice Department’s report and the revelations that the village police are conducting undercover operations in far-flung locations that have nothing to do with their small coastal community.

“This is Southern Florida,’’ said Neil Alter, who lives in the Balmoral complex. “Why are we pursuing criminals and drug traffickers who are on the West Coast of the United States? To what degree does it serve the Bal Harbour community?’’

In October, the Miami Herald reported that the village police department — a small town force heretofore known for writing traffic tickets — conducts undercover operations all over the country, and was under federal investigation for allegedly doling out hundreds of thousands in payments to informants, running up $23,704 in one month for cross-country trips with first-class flights and Cadillac and Lincoln Town Car rentals, and misspending seized funds on salaries and benefits for contract officers who work on the money laundering unit.

In a rare move, federal officials froze more than $8 million that Bal Harbour helped confiscate under the program, and the Justice Department now wants the village to hand over more than $4 million.

‘Jealous’ feds

The village police chief since 2003, Hunker, 61, is about to complete the third year of a four-year employment contract that pays him a base salary of $141,959.80 a year, and provides him with a car, health insurance and pension plan.

He has hired a criminal defense attorney, Richard Sharpstein, who denied the allegations and lambasted the Justice Department for airing unproven accusations in public.

“It’s doing nothing other than slurring and smearing Tom’s reputation unnecessarily and wrongfully,’’ said Sharpstein, who vowed that the chief would be vindicated.

Sharpstein said the Justice Department’s investigation was motivated by professional jealousy — and the federal government’s refusal to share millions seized by village police from drug dealers and money launderers.

“What this is about is they’re holding about $8 or $9 million that’s due and owning to Bal Harbour that they don’t want to pay. This has a lot to do with that,’’ he said. “They’re jealous because he got this money and they want it.’’

Indeed, Bal Harbour’s force became a massive cash generator after Hunker broke from the federally sponsored South Florida Money Laundering Strike Force and partnered with the Glades County Sheriff’s Office in Central Florida to form the independent Tri-County Task Force, which included police officers contracted out of retirement and based in New York, Southern California and Florida’s West Coast.

In the first year of the task force’s operations, Bal Harbour increased its share of federal payouts from drug seizures fourfold over the previous year: from $240,689 in 2008 to more than $1 million in 2009.

By 2011, Bal Harbour police helped reel in $5.1 million — more any other law enforcement agency in Florida.

But according to the Justice Department’s findings, the task force operated like a rogue unit.

Unlike other multi-agency task forces that investigate money laundering and drug trafficking, Bal Harbour police had no federal sponsor looking over its shoulder.

Its detectives made no arrests related to money laundering, and never presented a case for prosecution for money laundering, according to the Justice Department. The unit produced no investigative reports.

Instead, the Justice Department said, task force officers spent their time managing informants and picking up cash from drug dealers — with no limits on how much money an undercover cop could collect, and no standard operating manual for handling the large sums that sometimes exceeded $1 million.

A typical operation would begin with a task force informant receiving a phone call from a money broker, who acted as a middle man between the drug dealer and the money launderer. One of the task force’s undercover detectives would then arrange to pick up the cash, and coordinate the operation with DEA agents.

But DEA agents rarely took possession of the cash. Instead, task force detectives would deposit the money into undercover bank accounts maintained by Bal Harbour police. According to Justice Department investigators, Bal Harbour never audited those undercover bank accounts.

From the undercover bank accounts, the money would be wired throughout the country according to the money broker’s instructions.

Divvying it up

The role of DEA agents was to conduct surveillance of the people who dropped off the money to the undercover detective, and then make the arrests, according to the Justice Department.

Any money associated with the arrest was then subject to federal asset forfeiture.

Once the seized cash was released by a judge, the Justice Department kept 20 percent and distributed the remainder to the participating law enforcement agencies in line with the amount of hours, intelligence and personnel each contributed to the operation.

In three years, the Bal Harbour-led task force conducted 227 money pickups and laundered $56.2 million, the Justice Department said..

In conjunction with the pickups, the task force claimed 84 arrests and $49.7 million in cash seized.

But those arrests were conducted by other agencies, and Hunker was unable to provide federal investigators with a single example where task force cases were presented for prosecution by the Florida State Attorney’s Office.

What’s more, according to the Justice Department, Bal Harbour officers routinely inflated the hours worked on each operation, citing 2,000 hours in some cases and 4,000 hours on others.

In one email exchange between a Bal Harbour police captain and a DEA agent in May 2011, the federal agent writes to the village officer regarding the amount of time claimed: “Good thing you and Vargas don’t have to justify 4,200 hours!! COME ON MAN.’’

When asked by federal investigators why he claimed so many hours on the forms, the Bal Harbour police captain answered that he thought he was allowed to list a running total of hours spent on all money laundering investigations, and not just the hours specific to one operation.

Timothy Wagner, director of the South Florida High Intensity Drug Trafficking Area, a federal program that coordinates multi-agency law enforcement efforts, said federal agencies have very specific guidelines for undercover investigations of money laundering and drug trafficking.

If a law enforcement agency wants to form a task force under the HIDTA umbrella, he said, that agency must present a strategy with “a worthy end game.’’

“We look for the organizations that you’ve dismantled,’’ he said. “Arrests and seizures are a means to an end. The endgame in a HIDTA world is to disrupt and dismantle organizations that are trafficking in drugs or drug money or drug violence.’’

Bal Harbour police’s endgame was not so much about building criminal cases as it was about seizing cash, said Brian Mulheren, a resident of Carleton Terrace and a retired officer with the New York Police Department.

“Why would we be connected to Glades County that’s nowhere near us when there’s a task force in Miami that we should be part of,’’ Mulheren said. “It’s not for the benefit of the residents of Bal Harbour, and not for the benefit of the residents of Glades County, but to go out and get money.’’

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