EVIDENCE THEFT NEAR $3 MILLION

Drugs, Guns, Money Went Out Property Room Door; Records Sloppy, State
Auditors Find

More than $2 million worth of cocaine along with 560 pounds of
marijuana, 66 guns and a small fortune in cash vanished from the
Memphis Police property and evidence room, a state audit released
Tuesday shows.

Federal prosecutors say the loot was carted out the property room's
back door and sold.

Numerous city workers and accused drug dealers face federal charges.

One Memphis lawyer has been charged with laundering profits through
his firm.

The comptroller's report found that property room accounting was so
sloppy that the stolen amounts could even be higher than auditors suggested.

A scathing 1999 audit found many of the same lapses and warned of
future problems.

Police officials promised reforms and hired Jay Liner to clean up the
operation in December 2000.

He's since been charged with stealing guns, jewelry, golf clubs and
bottles of champagne from the room.

Dennis Dycus, who supervised Tuesday's audit, called the 1999 audit
the "tip of the iceberg," and Tuesday's audit the iceberg itself.

Walter Crews was interim police director or director from December
1999 until March 2003, when James Bolden succeeded him.

The property room holds evidence used for trials, as well as seized
weapons.

When it is no longer needed, it's supposed to be destroyed.

But high-value items slated for destruction were routinely siphoned
off. And there was little oversight to ensure those items were in fact
destroyed, the audit concluded.

Auditors found:

There was no policy manual.

Too many workers had access to evidence, and storage was inadequate.

Inadequate procedures for destroying contraband weapons and drugs.

Clerks could alter property room records, making thefts possible.

$147,218 in cash couldn't be found, even though records showed it was
still in the property room. Auditors even found marijuana lying around
loose on shelves and the floor.

The auditors recommend the department create an independent team to
oversee drug and weapon disposal, something the police brass have
promised to do.

Memphis Police Deputy Director Ray Schwill vowed Tuesday to make the
property room a model for other cities.

Once the audit began in September 2003, the department shut down the
facility in the Shelby County Jail basement, and worked out of
temporary quarters, he said.

Also since the audit, hand-picked officers with demonstrated integrity
have been in charge of logging in and destroying evidence, Schwill
said.

"I was shocked, as I believe everyone was," at the scope of the
thefts, he said.

Surveillance and computer equipment to document every transaction is
in place. Outside auditors will check everything. Every bit of
property will be bar-coded.

Clerks' access to evidence will be limited, he said.

"No one person will have too much authority," he said.

Michael Heidingsfield, head of the Memphis Shelby Crime Commission,
called the report "damning."

"These issues are five years old," he said, "and they involve
fundamental police policies."

The revelation that there was no policy manual is "unimaginable," he
said.

A drug investigation that began with a drug courier's arrest in April
2003 led police and federal agents to the property room.

An Atlanta man who pleaded guilty in federal court Monday told police
he got drugs from former property room employee Patrick Maxwell.

Maxwell awaits trial.

Former property room supervisor Kenneth Dansberry, who pleaded guilty
to drug conspiracy charges, told agents he lost track of how much he
and others stole.

He once sold 10 kilograms of cocaine off the loading dock, he said.

He had so much money that stacks of it stored in his home grew mold.

Two employees, Alnita Campbell and Jacqueline Layrock, await trial on
charges they took more than $100,000 in hush money from Dansberry.

They're also accused of several thefts, including swiping $30,000 and
destroying evidence envelopes to hide the theft.

After last fall's indictments, the case expanded to include Memphis
lawyer Scott Crawford.

Crawford, already facing charges of trying to fix several criminal
cases for high-ranking gang members, is charged with laundering
property-room drug profits through his law firm.