Informant’s credibility under fire from defense in Aspen drug case
June 19, 2011
ASPEN – The confidential informant enlisted by the Drug Enforcement Administration was a female so closely connected to alleged narcotics network ringleader Wayne Alan Reid that she took photographs of the drugs he packaged, relayed information he supplied her through phone calls made from jail, and turned over a duffel bag containing cocaine to the feds.
The informant’s intelligence gathering appears to be key to the U.S. government’s investigation into Reid, 65, of Aspen, and five other area residents arrested May 19 on a nine-count indictment a grand jury handed down one month earlier.
Details of her role emerged during a June 14 detention hearing in Denver’s federal court for Reid and Christopher Sheehan, where a DEA official testified that Reid confessed to receiving 1 to 3 kilograms every 40 to 45 days, for the past 15 years.
The informant’s credibility has attracted skepticism from two defense lawyers in the case. Aspen attorney Mark Rubinstein, appointed by the court to defend Snowmass resident Christopher Sheehan, also 65, questioned the validity of the source’s information at the detention hearing.
There, Paul Pedersen, a Glenwood Springs police officer and special task-force member with both the DEA and Two Rivers Drug Enforcement Team (TRIDENT), cited the role the informant had in the probe into an organization that allegedly funneled more than 400 pounds of cocaine from Los Angeles to Aspen over the last 15 years.
Based on information from the confidential sourse, the DEA believes Sheehan, on six occasions, bought 10 ounces of cocaine from Reid. The DEA also credits the source for supplying it with information that Sheehan once paid Reid $10,000.
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“How was it that the informant knew it was $10,000” that Sheehan paid to Reid, Rubinstein asked Pedersen.
“The informant was there with Mr. Reid,” Pedersen said.
Twice, the informant took pictures of the cocaine and gave the photographs to the DEA, Pedersen testified. The DEA’s own surveillance shows Sheehan acquiring 10 ounces of cocaine from Reid, Pedersen said.
“Typically when you use a confidential informant, TRIDENT would recruit an individual who is under investigation,” Rubinstein asked Pedersen.
“Most of our confidential informants were in trouble with the law at one point,” Pedersen said.
Reid’s court-appointed attorney, John Henry Schlie of Greenwood Village, also hinted that the anonymous source has her own issues.
“The confidential informant has a history of mental illness, does she not?” he asked Pedersen.
“I’m not aware,” Pedersen responded.
At one point, Judge Michael E. Hegarty asked Pedersen if he “received any information that turned out to be false from the confidential informant.”
“At this time I can’t say I did,” Pedersen said.
The judge also asked if the informant “ever said anything about the dangerousness of these two suspects.”
“No,” replied Pedersen.
Rubinstein said the DEA’s case presented at the detention hearing was “extraordinarily vague” and had “nothing to back it up.” Rubinstein called it a case of “he said, she said.”
Meanwhile, Pedersen outlined a number of transactions Reid made in California, noting that he had been watched by the DEA for the last few years. In fact, Reid was under surveillance when Garfield County deputies pulled him over for speeding on July 13, 2010, on Interstate 70. According to an affidavit for a warrantless arrest, deputies stopped Reid that day after the Toyota Highlander he was driving went 80-81 mph in a 75-mph zone, near mile marker 90 on Interstate 70.
Pedersen testified that officers seized $116,000 from Reid’s vehicle.
“[Reid] told the officer it was for his retirement,” Pedersen said. “He said it was just through employment, that he was saving it for retirement and he hadn’t gotten the opportunity to deposit it.”
Reid was en route to either California or Las Vegas to purchase 4 or 5 kilograms of cocaine before he was stopped, Pedersen testified. The information was obtained from the confidential source, he said.
After the stop, “the informant informed us Mr. Reid was going to get back on his feet and continue to traffic cocaine in the Aspen area,” Pedersen said.
The DEA has surveillance of Reid buying 2 kilograms of cocaine from Alfonso Elvao-Allocati, 70, of Los Angeles, who was also arrested May 19 as part of the bust.
Pedersen said Reid was with 67-year-old Anthony Buchanan – another Los Angeles resident who was detained during the May bust – when he bought the cocaine from Allocati. The transaction took place in September in Pasadena, Calif. Buchanan took 1 kilogram, Reid the other and “brought it back to Aspen and distributed it,” Pedersen said.
“As a result of this transaction they wiretapped Reid’s phone,” Pedersen testified. “We were able to listen to Mr. Reid and Allocati talk on the phone.”
The DEA was then turned on to an alleged December buy in Las Vegas, and worked with the local DEA to conduct surveillance.
“[Reid] received 1 kilo from Mr. Allocati in Las Vegas, then he returned to Aspen,” Pedersen said.
Local DEA surveillance showed Reid give half of a kilogram to Aspen resident Joan Anastasi, 67, also a defendant in the case, according to Pedersen.
The transactions continued, with Reid buying 1 kilo from Allocati on Jan. 13 in Las Vegas, and another kilo on either Feb. 3 or 4 in a Nevada border town from Allocati, Pedersen said.
In April, the Las Vegas DEA worked with a casino to set up surveillance of Allocati and Reid making another transaction.
“We determined we were going to arrest Mr. Reid at the point,” Pedersen said.
On April 8, Reid was flagged by Mesa County deputies for going 80 in a 75-mph zone on I-70 near the Utah border. Reid was required to have an interlock device in order to drive a vehicle, which starts the ignition only if the driver is sober, after being arrested for driving under the influence in Aspen in November 2007. A deputy’s search of the rental car he was driving yielded a brick of cocaine weighing more than 1 kilo.
Reid was placed in the Mesa County Jail. From there, he called the confidential informant, telling her to retrieve files from his house and give to Peggy Schlauger, 41, of Aspen. (Schlauger also was arrested May 19.) He also told the confidential source to pick up a black duffel bag, Pedersen said.
“The informant had access to his house,” Pedersen said. “The informant retrieved the black duffel bag from the garage and turned it over to us.” In the bag were “several vials of coke and Ziploc bags of coke,” Pedersen said.
Pedersen also said when agents searched Reid’s Aspen duplex after he was arrested, they found a book on “how to disappear.”
Reid’s attorney, Schlie, said the book was a gag gift.
“If I were to tell you that book was a gag gift for his birthday, do you have any evidence to refute that?” Schlie asked Pedersen, who had mentioned the book as a reason Reid presented a potential flight risk.
“No,” Pedersen replied.
While four of the six Aspen-area suspects are out on $20,000 bond, Reid and Sheehan remain in federal custody after Hegarty issued an order June 15 – the day after the detention hearing – to keep them incarcerated without bond.
Reid faces one count of conspiracy to distribute and possess with intent to distribute 5 kilograms or more of cocaine; six counts of distribution and possession with intent to distribute 500 grams or more of cocaine, along with aiding and abetting; and two counts of distribution and possession with intent to distribute a mixture and substance containing a detectable amount of cocaine and aiding and abetting.
If convicted, he faces a mandatory minimum prison sentence of 10 years, with a potential punishment of a lifetime behind bars.
Sheehan faces one count of conspiracy to distribute and possess with intent to distribute 5 kilos or more of cocaine; and one count of distribution and possession with intent to distribute a mixture and substance containing a detectable amount of cocaine and aiding and abetting.
They have both pleaded not guilty to the charges, as have the other four local defendants.
Four Los Angeles-area residents were also indicted in the case; three were arrested, one remains a fugitive.