JACK-POT

Federal law lets the cops pocket anything seized in a drug
bust--cars, boats, cash--and use it to fund the war on drugs. But
when Jane Gerth found a half-million dollars in the Okanogan woods,
the rules got more complicated.

The white ford pickup truck rolled onto a gravelly pullout next to
Highway 97, about 15 minutes south of the Canadian border, and
stopped, motor running. It was 7:20 p.m. on Friday, March 5, 2004, in
the orchard-lined Okanogan Valley of north Central Washington, an
expanse rimmed by pine-dotted hills and rocky ridges.

A stocky male figure stepped down from the four-door pickup, his
breath exposed by the icy night, and waded into the woods behind a
mailbox post. The driver felt his way through the scrub trees and
high grass. About 10 steps in, he froze, reached down, and lifted a
heavy black and gold backpack. Staggering, he returned to the truck
and dumped the pack onto the passenger seat. The man then slid behind
the wheel and eased the pickup back onto 97, a notorious drug
pipeline from Canada to California.

As the truck began moving, Deputy Dennis Irwin slowly turned his
Okanogan County sheriff's cruiser from the side road where he'd been
on stakeout and onto the highway, falling in a safe distance behind
the pickup. Irwin backed off as the driver briefly pulled over,
apparently checking the backpack's contents. Moments later, he pulled
over again. Game's up, an anxious Irwin thought, according to a
report he'd write later. He flipped on his emergency lights.

"Sheriff's office!" Irwin announced, after stopping the big pickup.
"Turn off your engine. Place your hands outside the window." With no
resistance, the driver stepped out and dropped to the pavement. He
was cuffed, patted down, and read his rights. Inside the truck, Irwin
found the black and gold bag. Its contents were exposed and partially
spilling onto the floor--a rolled-up blanket, two boxes of latex
gloves, and two military gas masks. That was all Okanogan deputies
had been able to scrounge up when they filled the backpack that
morning in preparation for their sting.

Ten hours earlier, on that same Friday, Jane Gerth was taking a walk
along the woody edge of a Highway 97 turnout near her home south of
Oroville. Her morning walks were a habit, and she'd notice the
slightest alterations in scenery, she later told authorities. A black
and gold bag poking up in the weeds was something that instantly
caught her eye.

Gerth, then 52, stepped through the weeds and tugged on the backpack.
She couldn't lift it. She untied some straps, and then unzipped the
main compartment. She stood back in amazement as bundles of $20 bills
oozed out.

There she stood, alone with her dogs and, clearly, hundreds of
thousands of dollars. Now what? Gerth today won't talk about the
discovery, but she obviously faced a number of choices: take the bag
home, hide it elsewhere in the woods, or call the cops, among others.
The wife of a retired U.S. Border Patrol agent, Gerth would later
tell authorities she wasn't naive about what she had found. Given the
weight and size of the bag, stashed in the brush here along a stretch
of highway known to be a Smuggler's Alley--clearly, this had to be
drug money. Turning the cash in would probably be the right thing to
do. Then again, she could keep the cache herself and still deprive
some trafficker of his ill-gotten gains. In one marvelous move:
justice and a Lexus.

But Gerth didn't hesitate. She rushed the short distance home and
told her husband. They quickly returned to the scene and, within
minutes, Dan Gerth was on the phone with the sheriff.

When Deputy Kevin Kinman arrived at the pullout, Dan Gerth, a slight,
5-foot- 8-inch man who was preparing to celebrate his 55th birthday
in a few weeks, waited anxiously with his wife. On Kinman's advice
over the phone, Gerth had driven his own pickup into the pullout to
occupy the scene and would later tell deputies he was feeling
uncomfortable about protecting the bag. Like his wife, Gerth
suspected the cash was crime money--and that someone could show up to
reclaim it at gunpoint.

Returning to headquarters with the backpack, Okanogan deputies
removed 55 pounds of money--$20 bills in $2,000 bundles, bound up in
nine vacuum-sealed packages and a blue Wal-Mart bag. The bills, many
in serial-number sequence, just kept coming, until they reached
$497,920. (A later recount brought the final tally to $507,070.) Eyes
widened: a half-million in cash, found in the toolies.

Sheriff Frank Rogers, a solidly built, 22-year law-enforcement
veteran, who calls Okanogan drug smuggling "an epidemic," was
delighted to hear of the find: If, as everyone suspected, it was drug
money, his department could, by law, take it for themselves.

A federal law passed in 1984 allows government agencies to seize
money and other assets associated with drug crime and use them to
fund the long and often futile war on drugs. The seizures can provide
law-enforcement windfalls: Just last month, the federal bust of a
Northwest ring allegedly running pot and Ecstasy out of Canada
included $5.2 million in seized homes, vehicles, land, and cash.

After concluding the stash was drug money, Okanogan deputies decided
they should return the backpack and stake out the drop site. The
backpack was refilled with the gas masks and other items, and then
dropped back into the woods.

That night, David L. Taber, 35, of Oroville, arrived at the scene in
his white Ford pickup. He was arrested and eventually charged with
money laundering. Okanogan County looked ready to collect on its
biggest drug forfeiture ever.

But three days after the bust, Dan Gerth sat down and penned a note
to Sheriff Rogers. "Dear Sheriff," he wrote, "On March 05, 2004,
while walking near Highway 97 south of Oroville, Washington, Jane
Gerth discovered a gold and black backpack along the road at a
location locally known as the Thorton Rest Area. Subsequent to this
discovery, the backpack was found to contain $497,000 in cash money.
Presently, this money has not been claimed by the owner(s). As
finders of this property we are making an official claim to the
$497,000 cash. Please consider this claim made with this letter as
prescribed by section 63.21.010 Revised Code of Washington State. . .
. Thank You."

Until he retired a few years ago, Gerth patrolled the border crossing
near Oroville. It's one of 12 entry points on Washington state's
300-mile border with Canada, ranging from a major crossing at Blaine
to remote eastern ports of entry such as Danville and Laurier in
Ferry County. Smugglers favor Highway 97, a two-lane pipeline that
runs from Osoyoos, B.C., through isolated Okanogan County, and into,
appropriately enough, Weed, Calif. They come bearing marijuana
shipments, bags of cocaine, and boxes of Ecstasy, among other
narcotics, but four-wheeled traffickers most frequently haul potent
B.C. bud to the States before ferrying back bags of money.

Officials say the Canadian drug industry is a multibillion-dollar
business, about equal the cost to combat it. There are more than
20,000 marijuana grow operations in British Columbia alone, according
to Canadian federal authorities, and most of the product heads south.
Active distributors include outlaw bikers and ethnic gangs. Last
month, a two-year, cross-border drug probe ended with the arrests of
almost 50 suspects, including members of a Seattle Vietnamese street
gang. (Federal officials in Seattle unabashedly named the
investigation "This Bud's Pho You.")

The most popular import is red-tipped B.C. bud--which is to hard-core
potheads what single malt is to Scotch connoisseurs. Shippers buy it
in British Columbia for up to $1,500 a pound and resell it for a
$1,000 per unit markup in Washington ($2,000 in California). On the
street, it can go for $300 an ounce.

Some smuggling operations have the cash flow of small countries.
Frank Tran, a multimillionaire financial kingpin based in Vancouver,
B.C., got 10 years in the slammer this past May for his involvement
in a cross-border money-laundering operation. At one point, Tran was
exchanging U.S. and Canadian currency at a rate of $300,000 a day.

It's the kind of money that attracts crowds. In June, four dozen
accused smugglers were indicted in Seattle and Spokane for delivering
tons of marijuana and cocaine across the border via helicopter. Among
those nabbed were former Edmonds municipal court judge and state
Supreme Court candidate James White, as well as onetime assistant
Seattle city attorney Mark Vanderveen. The two, now imprisoned, were
working as criminal defense attorneys when they decided a $100,000
drug-money payment from a client was worth risking their careers.

In July, demonstrating the global nature of Canadian drug exports,
authorities busted a ring of Alaskans and Canadians alleged to have
trafficked $10 million in B.C. bud while arranging international
money transfers in locales as varied as Alabama and Latvia. Canadian
drugs are constantly on the move by sea, air, and especially land,
using ATVs, RVs, and SUVs. There is a small smuggler air force of
planes and helicopters, adding to the smugglers' risks--three people
have died in two drug-chopper crashes in Canada since March 2005.

The drug flights are especially annoying to the smugglers' foes.
Leigh Winchell, Immigration and Customs Enforcement (ICE) special
agent in charge of the Seattle office, told reporters that smugglers
took a Playboy magazine writer on a drug sortie over B.C. last year
and bragged their dope delivery system was better than FedEx. "I
would be lying if I said we didn't take it as an affront," Winchell said.

New surveillance and identification technology, including motion
detectors, is used at the border. But authorities have also resorted
to throwback horse patrols in the wild terrain to contain a growing
invasion of drug-toting foot soldiers. They are often seen, according
to veteran ICE agent Tyler Morgan, walking "on farm roads, through
raspberry fields, and on logging roads." They bear knapsacks, duffle
bags, and hockey bags stuffed with marijuana and others drugs.

Still others go underground--literally. Last year, at a cost of
$400,000, a trio of tunnelers burrowed from a Quonset hut on the
Canadian side of the border into the living room of a house in
Lynden, Wash. The three men, who got nine-year prison terms, had
hoped to smuggle 300 pounds of dope a day, for starters.

Then there's the smuggler navy. When not floating the coastal waters
off Washington state and B.C., they take to the isolated lakes of the
North Cascades. Among them: Ross Lake, which ranges from Canada into
Skagit County, and 14-mile-long Lake Osoyoos, which flows from deep
in Canada to a state park on the edge of Oroville. ICE agent Morgan,
with a degree in accounting from the University of Washington, says
kayaks and inflatable boats are common drug conveyances of small-time
couriers who get anywhere from $100 to $300 per pound of dope they carry.

Of course, Washington also grows its own. Federal and local
law-enforcement officers last year seized 135,000 marijuana plants in
the state, worth $270 million, according to the Washington State
Patrol. As an agricultural product, dope ranks as Washington's
eighth-largest crop, just ahead of sweet cherries.

Most of last year's busts were made in arid Eastern Washington. As
Jane Gerth discovered, it's a bountiful region for the fruits of crime.

Okanogan officials suspected that Taber, an orchardist and part-time
used-car salesman, planned to haul the cash in the backpack to Canada
or wash it through a commercial bank account. Those are the two most
common methods buyers and sellers use to transfer funds: They enlist
intermediaries to physically smuggle the cash across the border or to
mix it into the accounts of a business front and then wire the money to Canada.

Before Taber could be accused of money laundering, Okanogan County
Prosecutor Karl Sloan, a Seattle University law grad and two-term
prosecutor, had to link the money to drugs. He relied in part on two
notes found in the black and gold bag. One, handwritten, contained
assorted calculations. The second, typed, appeared to list a variety
of payments for drugs, and seemed to indicate that the delivery came
up a few lids light: "Less shortages 20 + 18 + 21 + 34 grams," the
note stated. Receipts of quantity and price are commonplace in drug
deals, authorities said.

Both prosecutors and defense agreed that Taber picked up a bag that
had earlier contained $507,070 and that a dope smell filled the
counting room at the sheriff's office--along with the scent of
Febreze, commonly used to cover such odors. Experts told the court
that Taber's was a classic drug-money case, similar to others in the
past decade where seized backpacks contained hundreds of thousands of
dollars in vacuum-sealed bundles.

But Taber's attorney, Mark Watanabe of Seattle, argued that everyone
overlooked a simple point: The sheriff's department emptied the
backpack before Taber arrived. How could Taber launder money he never
had in his possession?

Okanogan County Superior Court Judge Jack Burchard seemed to agree,
noting that Taber "never received, possessed, or disposed of illegal
proceeds," and that the state couldn't cite a case of a person being
convicted of money laundering in similar circumstances. After a bench
trial, Burchard found Taber not guilty.

Never definitively answered was why Taber picked up the money in the
first place. Drug-money couriers are typically paid up to 4 percent
of the cash they carry--in Taber's case, this would have been around
$20,000. Would that have been worth the risk for a successful married
man who runs 12 fruit orchards in Okanogan County and who, according
to court papers, had a gross income of $124,000 in 2000?

Taber declined to comment, and his attorney, Watanabe, says his
client has moved on. An acquaintance, who preferred not to be named,
says he never thought Taber was involved in drugs and, in this case,
was probably just doing a favor for someone.

"I can see someone enlisting Taber to do this," says the
acquaintance. "He's this really good-natured country boy who reminds
me of Jethro from The Beverly Hillbillies."

All parties agreed that the $507,000 was proceeds of a crime. The
question now was: Who gets it?

If Sheriff Rogers got the money, he said, it would be earmarked, by
law, to fight drug crime in his far-flung county, where 30 sworn
personnel cover 5,280 sparsely populated miles of sageland, hills,
and mountains. Though it is comprised mostly of government land and
the Colville Indian Reservation, Okanogan County is the third-largest
county in the lower 48 states, featuring a 90-mile border with Canada.

"We've taken some [budget] cuts, and we have a lot of drug problems
here," Rogers says.

But the Gerths argued that the case was governed not by federal drug
forfeiture law but by Washington's 1979 "found property" law, which
says, in essence, that if the owner fails to turn up, finders keepers.

The Gerths' case, officially titled Okanogan County v. $507,070, was
heard in Okanogan County Court by visiting Judge T.W. "Chip" Small of
Chelan County. Small may be best remembered as the judge who recused
himself from the 2005 civil case brought by the Republicans
challenging the Washington gubernatorial election of Democrat
Christine Gregoire--in part because he was appointed to his seat by a
Democratic governor, Booth Gardner (though Small's wife is a
registered Republican and GOP national committee donor).

Small made clear he sided with the Gerths. They had found the stash
before it was deemed by a court to be drug-related. Therefore, he
ruled in January this year, "under the [state] lost-and-found statute
. . . they are entitled to the funds."

When asked outside court that day what she'd do with the money, Jane
Gerth just smiled at the prospect. The Gerths would have to pay
income tax, which could lop more than $100,000 off the amount.
Nonetheless, after two anxious years, she and her husband were
officially, if accidentally, half-millionaires.

It could have ended there, with the Gerths living happily ever after.
But euphoria turned to disappointment with the arrival of the next
morning's newspaper, and the headline: "County vows to appeal
decision awarding money to couple."

Deputy prosecutor Steve Bozarth said Small's ruling deserved review
by a higher court. The conflict between laws regarding found property
and drug-money seizures "needs to be fleshed out," he said. Bozarth's
boss, Sloan, said in a recent interview that "even given the fact
these were innocent finders, it's troubling that drug money doesn't
go to the agency that interdicts drugs. We felt another court should
be asked whether a finder has an interest in that money."

At that point, the case seemed headed for the state Court of Appeals
in Spokane, and a likely appeal to the state Supreme Court
thereafter. It looked like the Gerths might not see the money for years.

But, unknown to all but a few people, a few weeks after Judge Small's
ruling, Sheriff Rogers quietly handed the money to the Gerths.

"I never announced it because they didn't want a lot of press,"
Rogers told the Weekly last month. The payment has not been publicly
revealed until now.

Neither of the Gerths will talk about the payment today. "There's
nothing more to say," Jane Gerth responds. The Gerths' attorney also
would not comment.

His choice wasn't all that complicated, the sheriff indicated, once
the court ruled.

"The bottom line is, the decision rested with me," says Rogers, 49, a
Republican who recently was elected to a second term. "They're good
folks, they did nothing wrong, and I just said, 'I'm not going to
drag these people through this court stuff again.'"

On Feb. 17, Rogers signed the papers releasing the $507,070--plus
about $10,000 interest--to the Gerths. "They came by later and
expressed their appreciation," Rogers says. "I'd say they were pretty happy."