SANDY SPRINGS, Ga. -- A Sandy Springs couple that ran a barbecue joint was really cooking up a giant drug running and money laundering business.
The large-scale scheme coordinated with distribution of thousands of kilograms of cocaine imported from Mexico and transported from California to Kansas City, Philadelphia and Washington, D.C., and laundered millions of dollars in drug proceeds in Georgia, federal prosecutors say.
The organization coordinated its efforts through the KC PIT BBQ Restaurant in Sandy Springs, with the assistance of other businesses and professionals.
Jiles and Shannon Johnson, former owners of the now closed restaurant on Roswell Road, and Matthew Ware, the restaurant's accountant, have been sentenced to federal prison.
"All of the defendants in this case are deserving of the sentences handed down. Several of these individuals masked themselves as legitimate businessmen, while everyone lined their pockets with excessive profits gained from drug trafficking," Harry S. Sommers, the Special Agent in Charge of the DEA Atlanta Field Division, said in a statement.
According to federal authorities, to supplement his restaurant income, Jiles Johnson, who was also a commercial truck driver, drove cocaine from California to Philadelphia on behalf of Philadelphia cocaine distributor Mark Walker, his brother Sidney Walker and others.
As Johnson and Walker generated cash from cocaine sales, they purchased real estate in Georgia through Linda Tong, an Alpharetta-based real estate broker. Tong made "structured" deposits of over $500,000 a month into bank accounts. "Structuring" occurs when a person breaks down over $10,000 in cash into smaller deposits to avoid the filing of a Currency Transaction Report by a financial institution. The Johnsons invested more than $3 million in real estate holdings, including an 80-acre motorcycle racetrack in Twiggs County.
Ware accepted bags of cash in excess of $10,000 from Jiles Johnson and loaded it to some of his accounting firm's clients where they repaid him with checks made payable to Johnson and his business.
As the cash volume increased, Ware connected Johnson to financial planner Jacques Degaule to assist with the laundering.
Degaule traveled to banks in Georgia, Missouri, Pennsylvania and New Jersey where he deposited more than $7 million. No IRS 8300 Forms were filed, which are required when a trade or business receives cash over $10,000.
The Johnsons then used these laundered funds to underwrite their investments and the restaurant's operations. Evan Francis, a local car broker, coordinated the delivery of loads of cocaine, solicited customers and structurally deposited cash.
The cocaine was supplied from California by Jose Gastelum and Lorenzo Vargas. When Johnson couldn't make payments to his supplier, Gastelum and Vargas would take interests in his restaurant and racetrack as collateral. Ware assisted them in the process.
The organization unraveled in 2010 when law enforcement caught Jiles Johnson and two others attempting to deliver 35 kilograms of cocaine to Philadelphia.
All sentenced defendants entered guilty pleas except Ware, who was convicted after a jury trial in January 2013 and sentenced to six years in federal prison followed by three years of supervised release.
Jiles Walker received a sentence of 15 years in federal prison and five years of supervised release, while his wife Shannon got three years in federal prison and three years of supervised release.
(Atlanta Business Chronicle)