Rent. Coachella. LV Bag.
Those were code words used by North Carolina college students in the Venmo and Paypal apps to purchase marijuana, cocaine, and other hard drugs, according to news reports of a major drug ring bust this week.
Local law officials and federal prosecutors announced Thursday (December 17) the bust of the major drug trafficking ring involving at least nearly two-dozen current and former students at the University of North Carolina, Duke University, and Appalachian State University.
“Today, in the announcement we’re making today, is intended to save lives,” Matt Martin, U.S. attorney for the middle district of North Carolina said in a press conference on Thursday. “It’s a pretty grandiose statement, but let me explain. We’re here to announce today federal charges stemming from a large-scale drug ring at the University of North Carolina – Chapel Hill, Duke University, and Appalachian State. Federal drug charges have been brought against 21 persons to date. The investigation continues.”
Martin said a “few” of those current or former students were attending Appalachian State and Duke, but the “majority” were at UNC, where the investigation began.
“This was a large drug network and supply chain fueling a drug culture at fraternities and within these universities and around these universities and towns,” Martin continued at the announcement. “Now, I want to make it very clear. This is not a situation where you have single users, where you have a 19-year-old sipping a beer, where you someone taking a puff of a joint on the back porch of a frat house. These are 21 hardened drug dealers.”
OVER A THOUSAND POUNDS OF MARIJUANA AND HUNDREDS OF KILOGRAMS OF COCAINE WERE DISTRIBUTED
According to the announcement and a press release from the Orange County Sheriff’s Office, over several years, the ring trafficked over a thousand pounds of marijuana, hundreds of kilograms of cocaine, and “significant quantities” of other drugs from California directly to these college campuses using the United States Postal Service (USPS) and motor vehicle. Martin ticked off the other drugs trafficked as LSD, MDMA, mushrooms, steroids, Xanax, and human growth hormones saying the defendants used “very sophisticated methods” and used many financial institutions to launder the proceeds. Martin didn’t comment on an exact proceeds amount but said it was at least $1.5 million. “Lots of money, lots of drugs,” he concluded.
The major focus of the investigation revolved around the Phi Gamma Delta, Kappa Sigma, and Beta Theta Pi fraternities at UNC. “There were sales going on inside these houses,” Martin said. “Dealers set up inside these houses, poisoning fellow members of their fraternity, fueling a culture.”
AT LEAST ONE KENAN-FLAGLER STUDENT PLAYED A MAJOR ROLE
According to court documents, Francisco Javier Ochoa, Jr. of Turlock, California was indicted in November of 2019 as the “primary supplier” of cocaine and marijuana to the UNC fraternities. Investigators relied on cooperating sources and defendants as well as undercover monitoring and purchasing, among many other tactics to bring down the ring.
Jason Shuang Xu, who was a Kenan-Flagler Business School student between 2017 and 2019, according to his LinkedIn page played a major role in the distribution. Xu, who was a marketing intern at IBM between May and August of 2018 and held many other business-related internships during his time at UNC was identified as a “subordinate drug distributor” to one cooperating defendant. According to the court documents, Xu obtained “one-half ounce quantities” of cocaine every two weeks during the school semesters in 2017 and 2018. Xu was used as an “intermediary for the distribution of cocaine, psilocybin (mushrooms), and alprazolam (Xanax) at the Kappa Sigma Fraternity,” court documents say.
“XU is a member of this fraternity, and he provided illegal drugs to other fraternity members for distribution,” the court records say. “A search of Xu’s iCloud account revealed text messaging threads with CD2 and others, as well as photographs of cocaine, marihuana, marihuana use, and cocaine use.”
OTHER FINANCE AND ECONOMICS STUDENTS INVOLVED
At least a few other economics and finance students were involved in the drug ring. Economics is not housed within the Kenan-Flagler Business School. David Bayha was identified in the court documents as someone selling marijuana from his bedroom of the “Kappa Sigma house, and that Bayha posted marihuana prices to the UNC Kappa Sigma GroupMe thread.”
According to his LinkedIn profile, Bayha was studying economics at UNC where he was planned to graduate in 2021. Bayha is no longer a student at UNC, the school told Poets&Quants. Bayha’s only two interests listed on his LinkedIn page are UNC and Marijuana Business Daily. Bayha sold an eighth of an ounce of marijuana to an undercover investigator outside of the Kappa Sigma house last May, the court documents say.
Jason Nitsos, who, according to his LinkedIn profile was a quantitative finance major graduating in 2019 was also identified by the cooperating defendant in the court records as distributing drugs at a fraternity at UNC. The university says Nitsos actually earned a physics degree from UNC and is no longer a student. Nitsos, who is said to be a “subordinate cocaine distributor,” sold primarily to the Eta Chapter of the Beta Theta Pi fraternity at UNC. Between October 2017 and March 2019, Nitsos paid the cooperating defendant about $15,000 for cocaine in 32 Venmo transactions. Of those, 15 occurred over Theta Pi’s IP address on UNC’s campus.
The main cooperating defendant who supplied cocaine and identified many of the defendants said he “felt safe” supplying the drugs because the sources only sold to members of the fraternity and the sales happened in the “Phi Gamma Delta fraternity house behind closed doors.”
LOCAL SHERIFF: ‘IT UNFOLDED UNLIKE ANY CASE I’VE SEEN IN MY 40 YEARS IN LAW ENFORCEMENT’
According to Orange County Sherriff Charles Blackwood, who also spoke at Thursday’s press conference, his office was tipped to the trafficking ring while investigating another drug case in 2017. The sheriff on the case heard drug trafficking was happening at a frat house on UNC’s campus. “It unfolded unlike any case I’ve seen in my 40 years in law enforcement,” Blackwood said during the press conference, noting it was an “astonishing” amount of drugs. “Brazen attitudes. Casual use of just high volumes of drugs. Then the network started to unfold about the money.”
When it became clear the scope and scale of the ring, other local police departments as well as federal investigators were called onto the case. “We were all quite shocked,” Blackwood said about how “brazen” the individuals were about moving the narcotics. “It was not something we sought out to do. It came to us.”
Martin called upon officials and administrators at UNC, Duke, and Appalachian State to take a stand and not “turn a blind eye” to the issue of drug use and trafficking on their campuses. “The bright eyes of a promising set of young students have turned into the sullen, downcast eyes of drug dealers, of people who are addicted, of people who are struggling, of people who are washing out of classes because of drug use,” Martin said.
UNC Chancellor Kevin Guskiewicz said in a statement that none of the charged individuals were current students.
“We are extremely disappointed to learn of these alleged actions on our campus. The university is committed to working with law enforcement to fully understand the involvement of any university individuals or organizations so that disciplinary action can be taken,” Guskiewicz said.
SENTENCES COULD BE UP TO LIFE TERMS
Many of the defendants, including Xu and Nitsos, have already pleaded guilty and will be sentenced in February and March of 2021. Martin said depending on the charges brought against each individual and the amount of drugs in which they distributed, the sentences will range between five and 40 years and 10 years to life sentences in federal prison.
All charges from the U.S. Department of Justice are below
In an indictment returned on July 27, 2020, the grand jury charged the following defendants with conspiracy to distribute cocaine and conspiracy to distribute marijuana:
- ANDREW BOYLAN GADDY, age 24, of Carrboro, NC;
- TRAVIS MICHAEL EVANS, age 27, of Hillsborough, NC;
- DANE LAMBERT SIMON, age 23, of Durham, NC;
- BRIANHA NICOLE HASKELL, age 24, of Hillsborough, NC; and
- MARIELA ZAVALA MENDOZA, aka Maria Ochoa, age 25, of Turlock, CA.
In other indictments returned in July, October, and December, 2020, the grand jury charged each of the following defendants with conspiracy to distribute cocaine:
- ZACHRE CHASEN ABERCROMBIE, age 27, of Charlotte, NC;
- AMBER JANA JOHNSON, age 24, of Carrboro, NC;
- JOHN FREDERICK HOLLOWAY, age 23, of Carrboro, NC;
- DEVIN JAMES McDONALD, age 23, of Kill Devil Hills, NC;
- JASON BLAKE NITSOS, age 24, of Greensboro, NC;
- DEVON ANTHONY PICKERING, age 35, of Charlotte, NC;
- EDISON TORRES ROBLES, aka Fransisco Gallego Mandez Rodriguez, age 26, of Durham, NC; and
- JASON SHUANG XU, age 23, of Apex, NC.
Seven additional defendants were individually charged in October and December, 2020, with a variety of offenses:
- CHANDLER DAVID ANDERSON, age 27, of Wilmington, NC, faces charges of conspiracy to distribute cocaine and marihuana.
- DAVIS LINDSEY BAYHA, age 21, of Chapel Hill, NC, faces charges of conspiracy to distribute marihuana; use of a communication facility to facilitate a drug felony; and distribution of a controlled substance within 1000 feet of a public or private college or university.
- KYLE PARRISH BECKNER, age 22, of Boone, NC, is charged with distribution of LSD and use of a communication facility to facilitate a drug felony.
- BERNARD ALEKSANDER BUKOWSKI, age 24, of Raleigh, NC, faces one count of conspiracy to distribute cocaine and one count of possession with intent to distribute cocaine.
- CHARLES CLEVEAU POINDEXTER aka Chase Poindexter, age 23, and JACKSON ALEXANDER NORRIS, age 22, of Chapel Hill, NC, are each charged with conspiracy to distribute cocaine; use of a communication facility to facilitate a drug felony; and distribution of a controlled substance within 1000 feet of a public or private college or university.
- CHRISTOPHER ANTONIO REYES, age 26, of Greensboro, NC, is charged with conspiracy to distribute 100 kilograms or more of marihuana.