INDOOR POT FARM ALLURE IS GROWING

High Profits, Low Risk Spur Home Operations

A crackdown on meth, tighter border controls, no-money-down mortgages
and the lure of large profits are behind the rise of indoor pot farms
in the San Gabriel Valley and elsewhere, according to
authorities.

Since March, police have raided almost two dozen homes and businesses
converted to large-scale marijuana farming operations.

Officials believe many of the farms, which employ an assembly
line-style operation and can generate up to six harvests a year, are
funded by entrepreneurial gangsters looking for easy money during
hard times.

"My spin on it is Asian and Caucasian biker gangs have developed a
form of marijuana that is double the potency of Mexican marijuana,"
said Los Angeles County Sheriff's Capt. Dennis Werner. "The more
expensive the product, the more money they can get out of it."

Narcotics officers from Los Angeles, San Bernardino and Riverside
counties as well as agents from the federal Drug Enforcement Agency
and detectives from the Pomona and Azusa Police Departments
participated in the seizures.

In all, the 23 houses and one business accounted for a street value
of more than

$50 million worth of pot.

As with any good business model, pot growers need an outlet. Economic
forces create a market.

Crackdowns on methamphetamine labs provide a knowledgable work force;
easy-to-obtain mortgages furnish the land; medical marijuana
dispensaries and a re-emergence of the '60s pot culture supplies the
customers, said Gerald Caiden, a USC professor of economics and
political science who specializes in political corruption and
organized crime.

Beyond that, "It's not too difficult to come up with a little capital
and use a little entrepreneurship," said Lt. James Whitten of the Los
Angeles County Sheriff's Department.

The history of one house, at 1512 Eldertree Drive in Diamond Bar,
that was raided on March 21 is typical of the grow homes, Whitten
said.

The house sold for $823,000 in January, according to records from the
Los Angeles County Assessor's Office. The buyer, who has not been
identified by authorities, apparently put together a purchase loan
with little money down and made no payments for insurance or taxes.

Inside the home, detectives found marijuana valued at $12.5million
and an elaborate system of lighting and irrigation rigged to bypass
municipal utility service.

The unidentified buyer also owns a home at 7715 Emerson Place in
Rosemead that deputies raided two days later and seized less than $1
million worth of drugs, Whitten said.

A similar setup was employed there, officials said.

Again, the home was purchased with very little money down and
retained little or no equity.

"We think the facts resemble a series of cases in Northern
California," Werner said, "where grow homes were bought with 100
percent financing."

The typical arrangement consists of the buyer obtaining a mortgage
for 80 percent of the purchase price and then a silent second for the
remaining 20 percent, Werner said.

(redacted), 40, of San Francisco was arrested in the Eldertree Drive
house and charged with cultivation of marijuana for sale. He is being
held at the Pitchess Detention Center without bail. The unidentified
homeowner has been in contact with detectives through an attorney,
Werner said.

Although many of the houses display similar links and purchase
patterns, detectives have been unable to nail down any threads tying
them all together.

While Asian gangs, known as drug trafficking organizations or DTOs,
seem to control much of the San Gabriel Valley trade, Werner said
biker gangs and other criminal organizations are also involved.

A recent series of six busts in Palmdale involved African- American
suspected gang members. Four were taken into custody and 690 plants
were seized, Werner said.

The varying ethnicity of suspects all the more proves the
profitability of such ventures, Caiden said.

"This is a terrific business and marijuana is a great cash crop,"
Caiden said "The profits are enormous. If it wasn't so profitable, it
wouldn't be worth the risk."

Links to the San Gabriel Valley crop up in many other busts. Last
Monday, San Bernardino County deputies uncovered a grow home in
Yucaipa.

A check of public records indicates Liang is connected to the now
defunct Ever-Union Trading & Investment Inc. The company, which
authorities claim swindled investors in Taiwan, was busted in October
by Taiwanese officials and detectives from the Sheriff's Fraud
Bureau. Liang had been missing ever since, authorities said.

Police said the men arrested in many of these cases refuse to talk.
Most of the homeowners they interview claim to have little knowledge
of the activity.

"Several of the owners are elderly, in their 60s or 70s," Werner
said. "Who knows? They may be straw buyers. In a couple of cases,
said they had posted at a laundry. Somebody moved in and they get
cash every month. Each case is different."

Similar to meth labs, grow homes present a variety of poisonous
perils from the merely mild to considerably lethal.

"These houses become toxic waste dumps," Werner said. "Mold permeates
the walls. ... They dump gallons of liquid fertilizer. It's a
horrible health hazard to the community regardless of how you stand
on marijuana."

There is also a criminal element the farms seem to attract. An indoor
farm in Azusa began to draw the attention of authorities because of
the people it attracted.

"I noticed different people, weirdo-druggies walking down the
alleyway," said Sherri Wells of Glendora, who works in a bakery
supply company in the same complex. "After the fact though I realized
how crazy it is that you don't notice something like that until after
it happens."

Authorities said some of the product might find its way to medical
marijuana dispensaries, like one busted by authorities in West Covina
on Monday.

"They have to get their product somewhere," Whitten said. "It would
be a good venue for them to sell. Right now though we have no actual
information leading us to any one of those places."

If dispensaries are the ultimate destination for the tons of
marijuana produced at area grow homes, police might be overstepping
their bounds, according to Bruce Margolin, head of the Los Angeles
chapter of the National Organization for the Reform of Marijuana Laws
(NORML).

Margolin said the law protects pot grown for purely medicinal
purposes.

"But, the law is only as good as those who interpret
it,"

Margolin said. "Sometimes you have rogue cops. They want to go out
and kick in the door and seize the product. Very few, if any, have
been prosecuted."

But grow farm operators are choosing houses in the outlying suburbs
because it suits their immediate needs.

"Working out of a house cuts down the risks," Caiden said. "When you
cut down the transportation costs and any exposure to antiterrorist
measures, you increase profits."