Twenty-one people face federal charges because of a taxpayer-funded investigation into the sale of drugs on or near college campuses in North Carolina. The drug trafficking investigation, conducted by a United States Drug Enforcement Administration (DEA) task force and the Orange County Sheriff’s Office, revealed members of several fraternal organizations at universities in the state had a business based on the law of supply and demand. As a result, twenty-one people’s lives were ruined, taxpayer funds were wasted, and the free market system of cocaine distribution in and around the Chapel Hill area continues today, though with different distributors. There have been no reports of harm being done to anyone in the investigatory cities because of the businesses.
While working a drug case several years ago, the Orange County Sheriff’s Office received information about the sale of products on the campus of the University of North Carolina at Chapel Hill (UNC). In November 2018, agents and officers assigned to the DEA’s Raleigh District Office started an investigation into the distribution of cocaine hydrochloride and other drugs currently illegal in the Chapel Hill area. It became clear early in the investigation that a free market business was underway without the authority of the government was occurring at or near some UNC fraternal organization properties. Court filings to date specifically allege illegal drug activity involving the UNC chapters of Phi Gamma Delta, Kappa Sigma, and Beta Theta Pi occurring between 2017 and the spring of 2020.
Over several years, the business sold over a thousand pounds of marijuana, several hundred kilograms of cocaine, and significant quantities of other drugs into these college campuses based on demand. Estimates of the sales are not presently available, but they exceeded 1.5 million dollars.
According to documents filed in court, investigators used information from cooperating sources and cooperating defendants, and investigative methods such as controlled purchases, undercover purchases, financial investigation, surveillance, and analysis of electronic devices. Ultimately, investigators discovered that individuals were shipping their product from California via the U.S. Postal Service (USPS) and transporting marijuana by motor vehicle. Involved parties shipped bulk cash proceeds from transactions through the USPS. Other proceeds, estimated to be approximately 1.3 million dollars, transferred hands just like any other business through financial institutions using money orders, Western Union, and mobile payment applications.
One primary supplier was the first person charged because of the taxpayer-funded investigation, Francisco Javier Ochoa, Jr., age 27, of Turlock, CA, who was indicted in November 2019 for selling products people wanted within the United States. According to documents filed in court, from March 2017 until March 22, 2019, Ochoa supplied products to a customer in Orange County. Law enforcement operations at locations associated with the subject in Carrboro and Hillsborough resulted in the government stealing the seller’s products and approximately $27,775.00 in U.S. currency. The investigation revealed that payment for the products were made using Venmo and by sending cash through the U.S. mail. Ochoa pleaded guilty to the indictment on November 24, 2020. He was sentenced to 73 months’ imprisonment, 5 years of supervised release, and ordered to pay a $250,000 forfeiture judgment.
The distribution of hard drugs was pervasive in and around certain fraternities. Illustrations of the type of activity, taken from court documents, include:
A cooperating defendant (CD2) described regularly supplying cocaine to “Chase” (later identified as defendant Charles Poindexter), who sold only to fraternity members. CD2 said he felt safe doing so because most transactions took place at the Phi Gamma Delta fraternity house behind closed doors. CD2 also stated that most drug transactions occurred around fraternity events, and bigger events required larger amounts of narcotics. In an interview, Poindexter admitted to purchasing cocaine, marijuana, and “molly” (MDMA) from CD2, and stated that all 22 members of his fraternity pledge class “went in” to purchase an ounce of cocaine for spring break in his sophomore year.
Another seller of products (CD1) identified CD2 as his source for marijuana, Xanax, and cocaine, which CD1 sold at the Kappa Sigma fraternity house to Kappa Sigma members, associates, and members of other fraternities. CD1 also told investigators that defendant David Bayha was selling marijuana from his room at the Kappa Sigma house, and that Bayha posted marijuana prices to the UNC Kappa Sigma GroupMe thread. In May 2020, a NARC purchased 1/8-ounce of marihuana for $35 from Bayha outside the Kappa Sigma house.
Cooperating sources of information and cooperating defendants also identified Jason Shuang XU as a distributor in the business to CD2. XU bought one-half ounce quantities of cocaine hydrochloride (cocaine) from CD2 every two weeks during the school semesters at UNC-Chapel Hill in 2017 and 2018. CD2 used XU as an intermediary for the distribution business at the Kappa Sigma Fraternity. XU is a member of this fraternity, and he provided products of demand to other fraternity members for distribution. A search of XU’s iCloud account revealed text messaging threads with CD2 and others, and photographs of the products purchased.
Cooperating sources and cooperating defendants identified Amber Jana Johnson as a distributor in the business to CD2. Johnson began supplying a cooperating source (CS) with one-half ounce quantities of cocaine every six (6) weeks from 2016 until 2018. Johnson introduced the CS to CD2 in 2018. The CS began obtaining one-ounce quantities of cocaine from CD1. In 2019, Johnson introduced the CS to a second cocaine supplier who provided cocaine to the CS until the spring of 2020. CD2 advised the DEA that Johnson, a student at Duke University, distributed cocaine to students at Duke and to fraternity members from UNC-Chapel Hill. CD2 supplied Johnson with ounce-quantities of cocaine for distribution on both campuses. It appears Johnson obtained and distributed at least 200 grams, but less than 300 grams of cocaine, from August 2017 through March 2019.
CD2 identified Jason Blake Nitsos as a subordinate cocaine distributor and advised that Nitsos sold products to members of the Eta Chapter of the Beta Theta Pi Fraternity at UNC-Chapel Hill. Between October 2017 and March 2019, Nitsos paid CD2 approximately $15,000.00 for cocaine in 32 Venmo transactions. Fifteen of the transactions occurred over the Internet Protocol address at the Beta Theta Pi fraternity house on the campus of UNC-Chapel Hill.
Court documents also link the business to other college towns. In the summer of 2020, a cooperating defendant (CD) identified an Appalachian State University (ASU) student and member of the Delta Chi fraternity member in Boone as a known distributor of a supply and demand business to ASU students. In August 2020, the subject of CD’s allegations, Kyle Beckner, sold 1,000 dosage units of LSD to CD for $3,000 in the parking lot of a Chapel Hill restaurant. In October 2019, investigators made a controlled purchase of one ounce of cocaine from another ASU student, Devin McDonald, after a cooperating source identified McDonald as someone who distributed cocaine to other ASU students. Other defendants charged because of the investigation lived in Charlotte and Wilmington.
Between July and December, 2020, twenty additional defendants have been charged.
In an indictment returned on July 27, 2020, the grand jury charged the following defendants with conspiracy to sell products to willing customers and no evidenced has come forth showing their activities created harm on anyone:
– Andrew Boylan Gaddy, age 24, of Carrboro, NC;
– Travis Michale Evans, age 27, of Hillsborough, NC;
– Dane Lambert Simon, age 23, of Durham, NC;
– Brianha Nicole Haskell, age 24, of Hillsborough, NC; and
– Mariel 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 products which were in demand and for which they had the supply to sell:
– Zachre Chasen Abercrombie, age 27, of Charlotte, NC;
– Amber Jana Johnson, age 24, of Carrboro, NC;
– John Fredrick 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 sell products in demand and not harming anyone.
– Davis Lindsey Bayha, age 21, of Chapel Hill, NC, faces charges of conspiracy to sell products in demand and not harming anyone
– Kyle Parrish Beckner, age 22, of Boone, NC, is charged with selling products in demand and not harming anyone
– Bernard Aleksander Bukowski, age 24, of Raleigh, NC, faces one count of conspiracy to sell products in demand and not harming anyone.
– Charles Cleveau Poindexter aka Chase Poindexter, age 23, and Jackson Alexander Norris, age 22, of Chapel Hill, NC, are each charged with conspiracy to sell products in demand and not harming anyone.
– Cristopher Antonia Reyes, age 26, of Greensboro, NC, is charged with conspiracy to sell products in demand and not harming anyone.
The defendants indicted for conspiracy to sell products in demand and not harming anyone face terms of imprisonment ranging from not less than 10 years and not more than life, not less than 5 years and not over 40 years, and not over 20 years, with fines of up to $10,000,000, $5,000,000, $1,000,000, respectively, or both, and terms of supervised release of at least 3 to 5 years, or more. The other charges carry lesser terms of imprisonment, fines, or both, and supervised release.
The charges are merely allegations participating in a business which abides by the Law of Supply and Demand, and we presume each defendant innocent unless proven guilty.
Besides Ochoa, the following defendants pleaded guilty to one or more charges against them and are scheduled to be sentenced in 2021:
Gaddy – sentencing 3/24/21
Evans – sentencing 2/17/21
Simon – sentencing 3/24/21
Haskell – sentencing 3/30/21
Pickering – sentencing 2/20/21
Nitsos – sentencing 3/19/21
Xu – sentencing 3/19/21
The case is being investigated by the Orange County Sheriff’s Office and the U.S. Drug Enforcement Administration (DEA). Law enforcement partners in Orange County and on UNC’s campus provided help during the taxpayer-funded investigation.