Undercover gambling probe leads to cocaine, meth ring as well

It began three years ago as a probe into illegal, after-hours gambling dens, with an undercover Seattle cop posing as "Brian," a "trust-fund baby" who wanted nothing more than to party and make a quick buck, according to court documents.

But by the time police and federal agents swooped in with a series of busts on Wednesday and early Thursday, that undercover officer had managed to infiltrate and expose a drug ring that was dealing hundreds of thousands of dollars in cocaine and methamphetamine, prosecutors charge.

At the heart of the operation, according to the federal charges filed Thursday, were the operator of the gambling houses and his trusted friend, along with a Honduran man and two of his alleged henchmen, who prosecutors assert are major suppliers of cocaine and methamphetamine.

Those charged in U.S. District Court with a variety of drug and gun charges are Richard W. Wilson, who is alleged to be the operator of the gambling houses in Seattle; his friend Marshall Reinsch; and three Honduran men: Carlos Zavala-Bustillo, Cesar Canterero-Arteaga and Edwan Fletes.

All were ordered held in federal detention. The three Honduran men are allegedly in the country illegally.

All five men were arrested Wednesday afternoon after trading 7 kilograms of cocaine, 3 pounds of methamphetamine and a special Honda Accord with hidden compartments to the undercover officer for $217,000 in cash, according to the complaint.

Early Thursday morning, police stormed Wilson's Capitol Hill apartment, behind a bar on East Pike Street, and arrested about a dozen other people. They were engaged in late-night gambling, according to neighbors and a law-enforcement source familiar with the raid.

"It has not been a very hush-hush thing," said Lydia Olson, 20, a resident in the same building who said the games were held twice a week for years. "Everybody in the apartment building knew this was going on. It didn't bother them."

Seattle police first started looking into the after-hours gambling halls in 2006, according to the federal charging document.

In September 2007, officers discovered such a club in an unused garage on 14th Avenue on Capitol Hill, according to the law-enforcement source. That night, a mustachioed man dressed in 1930s garb identified himself as a maitre d', and told the officers that it was a private club where members brought their own liquor and played poker.

That club has since been shuttered and the garage razed.

But as they continued to investigate, police discovered that three of the clubs were being operated by Wilson, prosecutors allege. They hatched a plan to send in "Brian," the undercover officer, to find out what went on.

By posing as the trust-fund brat, Brian gained Wilson's trust, and soon Wilson was selling Brian large amounts of cocaine, according to the federal complaint.

Eventually, Wilson introduced Brian to his alleged supplier, Reinsch, described in charging papers as an unemployed nightclub hopper who boasted that he sold more than a kilo of cocaine a day.

According to prosecutors, Brian and Reinsch met frequently at a restaurant on South Lake Union and also met once at one of Wilson's gambling clubs called "The Yard" near 14th Avenue East and East Pike Street.

At that meeting, prosecutors allege, Wilson got in on the action by offering to act as "security" for the drug deal in exchange for a couple hundred dollars.

During another meeting at Wilson's apartment, prosecutors say, Wilson showed Brian several guns, including a revolver with a Seattle police stamp on the handle, prosecutors said.

After he made one drug purchase from Reinsch in May for $20,500, Reinsch began to encourage Brian to start buying much more, the charging papers say.

They finally agreed to the $217,000 purchase of drugs and the modified Honda, which was meant for Brian to safely smuggle his haul to Eastern Washington to sell.

When Brian showed up Wednesday at the South Lake Union restaurant-parking lot, however, Reinsch unexpectedly had the three Honduran men with him, the prosecution said. Reinsch referred to Zavala-Bustillo as "my guy," and Zavala-Bustillo appeared to be in charge.

They made the deal, prosecutors said, and then police arrested them all.

According to the charging documents, Reinsch began dealing drugs last year in local nightclubs. When he found himself buying half-kilograms at a time to resell, he was introduced to Zavala-Bustillo, described as the "main Honduran supplier." Reinsch allegedly said Zavala-Bustillo dealt in 100-kilo shipments.

Ian Ith: 206-464-2109 or iith@seattletimes.com.

Jennifer Sullivan: 206-464-8294 or jensullivan@seattletimes.com