The oldest private college in the state of West Virginia has a shot at getting back hundreds of thousands of dollars seized by the DEA, thanks to a recent decision by a federal judge. In very few cases do plaintiffs in asset forfeiture cases even get to make an attempt to retrieve seized money. In no other case but this one does the story begin like this [h/t Eric Goldman]:
This case arose from the collision of “sexting,” extortion, embezzlement, drugs, and most importantly, the administrative forfeiture of illicit funds under 21 U.S.C. § 881 and 19 U.S.C. §§ 1602-1619.
Shelly Lough was an employee of Bethany College, working as a cashier in the school's business office. She began an affair with Jason Weese, which apparently involved some sexting. Six months after this relationship began, Weese partnered up with his wife Rachaelle (going beyond the normal expectations set down by marriage vows) to use Lough's photos against her.
They told Lough that they would send the messages and photos to her husband, family, employer, and other authorities. Then the threats became violent. The Weeses told Lough that they knew where she lived and what vehicles her children drove. The Weeses threatened to burn Lough’s house down and to harm her husband. As the threats escalated, so too did the amount of money the Weeses demanded. In total, Lough embezzled $837,398.52 from Bethany to pay the Weeses.
Bethany College opened an investigation in August of 2013 after noticing $500,000 in "accounting discrepancies." The police were brought in. Detectives spoke to Lough, who admitted taking that (and much more) to pay the Weeses to keep them from distributing the intimate photos. The police turned this over to the FBI, who arrested the marital partners in crime in March of 2014.
MEANWHILE, AT ANOTHER FEDERAL AGENCY:
Before the Weeses’ extortion scheme was uncovered, the DEA began investigating Jason and Rachaelle Weese in October 2012. The DEA suspected that the Weeses were operating a marijuana “grow house” in their residence in East Liverpool, Ohio. Officers obtained a search warrant for the house and executed the search on March 19, 2013. The officers did not find a grow operation, but did find marijuana distribution paraphernalia. The officers also searched the Weeses’ safe, finding 169 grams of marijuana and $262,020.00 in United States currency (“the Currency”). The officers seized the Currency and determined that it was the proceeds of the Weeses’ drug activities.
Lough testified that the money she turned over to the Weeses was obtained from a local bank and could be identified by the branded bands (initialed by bank employees). Indeed, a post made to Rachaelle Weese's Facebook page by Jason Weese showed just such a band, along with a several $50 bills. The investigator in the extortion case confirmed Lough's assertions and the content of the Facebook post.
The DEA, however, noted the money it
seized were stacks of smaller bills held together with rubber bands. It also pointed out that the money appeared to have come from the Weese's "drug operation" and that neither one of the Weeses could come up with a legitimate source for the $260,000.
As is the normal procedure for forfeitures, the DEA posted a notice on forfeiture.gov for the alotted 30 days, and sent out notices to the Weeses. After the notices expired, the DEA took the money and distributed it to itself and participating local law enforcement agencies.
Bethany College, obviously, had no idea this money had been seized by the government, much less for reasons entirely unrelated to its embezzlement investigation or the FBI's extortion investigation. By the time it contacted the DEA about the funds, the money was gone.
The government argued (at least on behalf of one
of its agencies) that the DEA had no reason to believe the money came from anything but the nonexistent marijuana grow operation it didn't find. According to its officials, the $262,000 came from the Weeses' low-level "trafficking" operation, as supposedly evidenced by the one-third pound of marijuana and paraphernalia recovered.
Bethany contested this assertion, entering enough evidence to make the DEA's assertions questionable.
To that end, Bethany submitted enough evidence for a reasonable jury to find that the Currency belonged to Bethany. Lough confessed to giving the embezzled funds to the Weeses. Some of Lough’s payments were in smaller bills while other payments were in larger bills wrapped in WesBanco bands. Jason Weese posted a picture of crisp $50.00 bills on Rachaelle Weese’s Facebook page with a WesBanco band later identified by the issuing bank teller as being issued to Bethany. Jason and Rachaelle Weese admitted that the Currency came from the proceeds of their extortion. Further, the Weeses concealed the true source of the Currency from the DEA in the course of its investigation. Based on this evidence, a reasonable jury could certainly conclude that the Currency came from the proceeds of the Weeses’ extortion and Lough’s embezzlement from Bethany. Thus, a reasonable jury could find that Bethany had an interest in the Currency.
The government also argued there was no way the DEA would have uncovered the true source of the money it had seized. According to the government, the drugs and paraphernalia found at the Weeses' home was enough to support its contention that all
of the funds it took were the proceeds of drug sales. This apparently makes any evidence produced after the fact completely irrelevant, even if the DEA's justification for the seizure was shaky to begin with.
Bethany argues that, based on the relatively small amount of marijuana found, it is unlikely that the Weeses had accumulated over $260,000.00 from street-level drug dealing. Further, the DEA looked at Jason’s Facebook page, but did not look at Rachaelle’s, which would have revealed a picture of $50.00 bills with a WesBanco band, later identified as having been issued to Bethany. Instead, Bethany argues, the DEA focused its investigation almost entirely on Jason and unjustifiably assumed that the Currency was the proceeds of the Weeses’ drug dealing.
Again, the judge finds Bethany's arguments to be persuasive enough to grant it permission to move forward in its challenge of the DEA's seizure.
Viewing the record in Bethany’s best light, this Court concludes that a reasonable jury could find that the DEA should have known, based on its investigation, that the Currency was not the proceeds from the Weeses’ drug sales. Further, a reasonable jury could find that a continued investigation into the Currency’s source could have revealed that it belonged to Bethany. Therefore, this Court finds that there is a genuine issue of material fact as to whether the DEA reasonably should have known of Bethany’s interest in the Currency, and this Court denies the government’s motion for summary judgment as to this issue.
The court does grant the DEA summary judgment on the "actual knowledge" aspect, but is not convinced the agency has an open-and-shut case when it comes to the other issues. Bethany College can, for now, fight the uphill battle to retrieve a portion of the funds taken from it -- first by Shelly Lough, then by the Weeses and finally, by the DEA.