Tuesday, December 30, 2008

Commonwealth’s Proposed Findings of Fact (Part 1)

COMMONWEALTH’S PROPOSED FINDINGS OF FACT

1. The Defendant Harlow Cuadra joined in/filed a motion to suppress evidence as a result of a May 15, 2007 search by the Virginia Beach Police Department.

2. Detective Matthew Childress of the Virginia Beach Police Department and Corporal Leo D. Hannon of the Pennsylvania State Police testified at a December 4, 2008 suppression hearing for the Commonwealth of Pennsylvania.

3. No witnesses were called by the Defendant, however, counsel for Joseph Kerekes, Attorney John Pike moved into evidence the transcript of the initial suppression hearing held on September 22, 2008. (N.T. pg. 56).

4. Detective Matthew Childress works for the Special Investigations Division of the Virginia Beach Police Department. (NT. pg. 6). The Special investigations Division investigates organized crimes, vice, narcotics, money laundering and prostitution. (N.T. pg. 6).

5. Detective Matthew Childress testified that Norfolk Companions is an escort company that operated in the Hampton Roads and Virginia Beach area (N.T. pg.7).

6. Detective Childress testified that he began to cultivate informants to infiltrate Harlow Cuadra, Joseph Kerekes and Norfolk Companions. (N.T. pg. 8). The “Boisrus” Internet website which was operated by Cuadra and Kerekes advertised the escort services of Norfolk Companions. (NT. pg. 8).

7. Commonwealth Exhibit 1 at the December 4, 2008 hearing was a page from the Boisrus web site listing a menu of different services the Defendants offered as testified to by Detective Childress. (N.T. pg. 9) This was printed out on December 21, 2006 by Detective Childress more than a month before the Kocis homicide. (N.T, pg. 57).

8. Exhibit 1 sets forth that “hot studs” would pick one up in a 2006 BMW M5 and the person can be taken back to the fabulous upscale in-call facility for “whatever it is hot boys do it unwind.” A nude video with the studs was available. This was an eXXXclusive offer. (NJ. pg 10-1 1.)

9. The 2006 BMW M5 is the car that is the subject of this motion. (NT. pg. 13). Detective Childress, as part of his RICO investigation, secured a Department of motor vehicle liens search on January 10, 2007, which predated the Pennsylvania homicide of Bryan Kocis. (N.T. pg. 34)

10. The informants, Andrew Shunk, Justin Hensley and David Jacobsen provided Detective Childress with information concerning the use of this car, as well as, money laundering and prostitution. (N.T. pg. 14)

11. In May 2007, Detective Childress was advised by the Pennsylvania State Police that they were preparing homicide warrants against Harlow Cuadra and Joseph Kerekes. (NT. pg. 16)

12. In January 2007, Detective Childress was running a RICO investigation on Harlow Cuadra’s and Joseph Kerekes’ businesses. (NT. pg. 16). The Pennsylvania homicide investigation and the Virginia Beach RICO investigation were paralleling each other and being investigated simultaneously. (N.T. pg. 16).

13. On May 14, 2007, Detective Childress prepared a search warrant for the Defendants’ home and vehicles. (N.T. pg. 17) Paul Powers, an Assistant Commonwealth Attorney for Virginia Beach, reviewed and approved the warrant. (N.T. pg. 18) Judge Shadrick, a Virginia Beach Circuit Court judge, viewed and signed the warrant on May 14, 2007. (N.T. pg. 18-19). Pertinent paragraphs of the search warrant include the following: Section 3: the things or persons to be searched for our described as follows:

any and all assets, personal property, luxury items, jewelry, US currency, vehicles, or any and all items obtained, used, or associated with the furtherance of the criminal enterprise, or associated with the laundering of assets derived in whole or in part from the criminal enterprise, or prostitution ring.

Section 4: The material facts constituting probable cause that the search should be made:

The Virginia Beach Police Department’s Special Investigations Division received a complaint in January 2006 that a prostitution ring was being operated in the City of Virginia Beach, disguised as a legitimate escort service advertises Norfolk Companions Inc. This escort company was owned and operated by Harlow Cuadra and Joseph Kerekes. A similar complaint was received in August 2006 alleging that the web site boisrus.com was operating as a front for illicit prostitution. The State Corporation Commission has Harlow Cuadra as the President of Norfolk Companions, Inc. and the City of Virginia Beach shows a business license issued to Norfolk Companions at 2537 N. Landing Rd, Virginia Beach, Virginia. As of December 27, 2006, Norfolk Companions, Inc. has listed their address as 1028 Stratem Court, Virginia Beach, Virginia, 23451. A DMV and pistol records check shows both Harlow Raymond Cuadra (W/M;08/05/1 981; SSN:XXX-XX-XXXX) and Joseph M. Kerekes (W/M; 12/30/1973;SSN XXX-XX-XXXX) as both residing at 1028 Stratem Court.

Confidential Informant (CI) #170 is a reliable confidential informant, whose information has been cooperated, and was once employed by Norfolk Companions, Inc. CI #170 states that Norfolk companions and is owned by Harlow Cuadra and his business partner Joseph Kerekes and that they operate the business from their house and Virginia Beach located at 1028 Stratem Court. CI #170 states that potential clients sign up to be members of a web site called Boybatter.com for $200 or they are able to purchase XXX DVD videos and also order escort services on a linked web site boisrus.com. CI #170, while working as an escort for Norfolk Companions, was directed by Harlow Cuadra to perform sexual acts with paying clients. Cuadra was present during the performance of the sexual acts with those clients.

CI #170 received payment in check form and in cash from Norfolk Companions, Inc. for his escort/sexual services rendered. The checks were drawn from the Company’s checking account through a bank of the Commonwealth for $150.00, which is 30% of the $500 booking fee Norfolk Companions Inc. received, CI # 170 states that Harlow Cuadra and Joseph Kerekes are the primary escorts, but they also employ several other young men as well. Cl #170 has worked as an escort in the past for Norfolk Companions, Inc. and continues to have contact with Cuadra and Kerekes. This affiant observed the workings of Cuadra’s web site, boisrus.com This affiant learned from the web site that an “in-call” service is $200 per hour and “out-call” service is $250 an hour. CI # 170 states that “in call” refers to a date that is held at Cuadra’s house and “out-call” refers to the escort going to the client’s home or hotel room. In-call services are advertised as “all inclusive” and are held at their house at 1028 Stratem Court; the room provided as a massage table, multiple head shower, king size bed, leather couch and a hot tub and alcohol and snacks are provided for the client. Cuadra and Kerekes offer the client use of their video camera to tape the encounter. Out-call services require the escort/prostitute to meet with a client their home or at a hotel room where money would be given for sexual services; the escort/prostitute would comply with the client’s sexual request is directed by Cuadra and Kerekes, the escort/prostitute would then take the money back to Cuadra and Kerekes were they would give the escort/prostitute a percentage of the earnings. Cuadra and Kerekes advertise a “Signature Combo Deal” for $350 per hour at their “$1 million location” and that “rates all are all inclusive. No tips needed! Top, bottom, versatile, vanilla, active, passive service is rendered as needed!” This affiant affirms that these terms refer to sexual positions and preferences.

As of May 12, 2007, CI #170 has had continuous contact with both Harlow Cuadra and Joseph Kerekes. They have offered CI #170 cash bonuses to return to full employment. CI #170 states for employment to include escort/prostitution as well as filming pornographic movies. Large-scale prostitution rings are motivated by the profits generated from prostitution, which they used to enhance their lifestyle or recognition in the community through the purchase of luxury items. Assets may include the purchase and leasing of property, the purchase and rental of communications equipment him of.

14. Judge Shadrick personally took the warrant to the Clerk’s Office and stamped it in at 3:24 p.m. (N.T. pg. 19) The search warrant authorized the seizure of vehicles related to prostitution or the escorting business (NT. pg. 84).

15. The next day, on the morning of May 15, 2007, Detective Childress received word from the Pennsylvania State Police that homicide warrants were issued by a magistrate against Harlow Cuadra and Joseph Kerekes. (N.T. pg. 20).

16. Detective Childress testified that in February 2007 a search warrant had been executed at the Defendant’s home at 1028 Stratem Court, Virginia Beach, Virginia and two weapons were recovered; a .50 caliber Desert Eagle and a Smith & Wesson weapon. (N.T. pg. 21-22) Detective Childress testified that bullet holes were observed in the wall of the master bedroom in February of 2007. (NT. pg. 22).

17. As of May 2007, the Defendants’ Glock 9 mm was still unaccounted for which Detective Childress, Corporal Hannon, and Virginia Beach SWAT were all aware of prior to the execution of the May 14, 2007 search warrant and physical arrest of Harlow Cuadra and Joseph Kerekes on Pennsylvania homicide charges on May 15, 2007 (NT. pg. 22).

18. Prior to the execution of the May 14, 2007 search warrant, Virginia Beach police surveillance was running around the clock and the Defendants were staying within the residence. (N.T. pg. 23).

19. On the morning of May 15, 2007, Detective Childress received word homicide warrants issued in Pennsylvania for the defendants; Detective Childress was then notified the defendants were leaving their residence with what appeared to be a bag/luggage. (N.T. pg. 24, 54) Detective Childress notified PSP of this development. (N.T. pg. 24)

20. Detective Childress was advised that the Defendants were leaving in their BMW M5. This was second hand knowledge to Detective Childress. (N.T. pg. 24).

21. The Virginia Beach search warrant, Commonwealth Exhibit 2, authorized a search of 1028 Stratem Court, Virginia Beach, Virginia and a search of vehicles on the curtilage. (NT. pg. 25) This was for RICO violations. (NJ. pg. 52).

22. The Defendants both entered the vehicle and drove away. (NT. pg. 26). Sergeant Winn, Detective Childress’ supervisor, and PSP decided, with the Defendants on the move, they should be taken into custody. (NT. pg. 26) Marked units of the Virginia Beach Police Department stopped the Defendants in the 3900 block of Virginia Beach Boulevard which is approximately 5 miles from their home. (N.T. pg. 27). This is a public place. (N.T. pg. 84). Marked units were used to ensure the Defendants were aware they were being stopped by law enforcement. (N.T. pg. 27). This occurred at 10:40 a.m. (NT. pg. 48). They were arrested on the Pennsylvania homicide warrants, (N.T. pg. 49).

23. Virginia Beach Police Department seized the BMW M5; it was taken back to the Special Investigations Division. (NT. pg. 28).

24. Virginia Beach police later searched the BMW. (N.T. pg. 29).

25. Virginia Beach Police Department has policies concerning the search of vehicles that are seized. (NT.T. pg. 29). Commonwealth Exhibits 3 and 4 are general policies/orders issued by the Virginia Beach Police Department.

26. Virginia Beach Police Department General Order 6.01, titled “constitutional issues” was marked as Exhibit 3. (N.T. pg. 29). Page 8 of the document addresses Vehicle Inventory Searches. (NT. pg. 29) The effective date was January 9, 2007 (NT. pg. 61).

27. Virginia Beach Police Department General Order 12.12 refers to Abandoned Vehicles, Towing and Inventory Procedures. (NT. pg. 30). The effective date was September 15, 2005. (N.T. pg. 61).

28. Detective Childress stated that these procedures were followed concerning the search and seizure of the BMW M5. (N.T, pg. 30).

29. Detective Childress testified that after the vehicle was seized, it was taken back to Special Investigations and secured. (NT. pg. 30). Whether the vehicle was contraband or whether the vehicle was seized pursuant to a search warrant, it had to be inventoried. (NT. pg. 88).

30. Detective Childress conducted the inventory search of the BMW M5. (N.T. pg. 30, 85-86). Some of the items recovered from the Virginia Beach RICO warrant were turned over to the Pennsylvania State Police. (NT. pg. 53). When they were initially seized, it was not for the purposes of the Pennsylvania investigation. (N.T. pg. 53) Detective Childress opened the glove compartment to the BMW, saw the tin container, opened it up and saw the Sig-Sauer knife. (N.T. pg. 79-80). The knife was not seized at the direction of any Pennsylvania law enforcement. (N.T. pg. 89) Once found, Detective Childress notified Pennsylvania law enforcement turned the knife over to them. (N,T. pg. 89) Detective Childress was aware that the Pennsylvania homicide had been committed with a knife. (NT. pg. 89).

31. Detective Childress testified that if a car is taken under forfeiture, Virginia Beach Police Department would do an inventory search. If Virginia Beach Police Department finds evidence or items in the vehicle that are of evidentiary value, they will be taken as evidence. (N.T. pg 96) Virginia Beach Police Department General Order 12.12 states “if the officer removes any item from the vehicle as evidence, the item will be documented on a separate property voucher and it will be packaged and submitted to the property in evidence unit in accordance with present policy concerning the evidence.” (N.T. pg. 97).

32. During the course of that inventory search, Detective Childress stated that items were documented thereby serving a two-fold purpose. First, it protects their personal property and secondly documents any evidence recovered from the vehicle. Those items were listed on Virginia Beach Police Department property voucher form which is the PD 78-4 form. (N.T. pg. 30-3 1).

33. Detective Childress further delineated what an in-service call is and what an out- service call is in prostitution. (N.T. pg 31). An in-service call is where the client would come to the provider either at a hotel room or at their residence. (N.T. pg. 31). An out-call service is where the provider would go to the client, whether at the client’s residence or a hotel or at some other location. (NT. pg. 31).

34. Detective Childress said this was set forth in the probable cause affidavit to the search Warrant. (NT. pg. 31).

35. Detective Childress stated that the search warrant authorized the seizure of items associated with prostitution and money laundering. (NT. pg. 32).

36. The items authorized to be seized were luxury items, vehicles, jewelry and cash. (N.T. pg. 32).

37. Detective Childress stated that the BMW M5 was considered a fruit of prostitution. (N.T. pg. 32). The car was considered contraband as it was used to facilitate their prostitution. (N.T. pg. 32, 84-85). The car was used to pick up and chauffeur clients. Its use was directly related to their business of prostitution. (N.T. pg. 32). In response to the court’s questioning, Detective Childress testified that the escort service was actually a disguise for the illegal prostitution ring. (NT. pg. 98). Detective Childress stated, in response to the Court’s questioning, his investigation in January 2007 was nearing an end when the Pennsylvania facts came into play. (N.T. pg. 99). Detective Childress stated at any time in December 2006 or January 2007, Virginia Beach police could have seized all of the Defendants’ assets. (N.T. pg. 99).

38. Detective Childress said that exigent circumstances existed when the Defendants were arrested because the Defendants were on the move and may have had a Glock 9 mm, weapon. Homicide warrants had been issued out of Pennsylvania; they had the means of absconding. (N.T. pg. 33) Detective Childress further related that the Defendants had a substantial amount of assets that they could easily liquidate through pawn shops and flee the area (NT. pg. 100).

39. After the BMW was seized, Detective Childress met with the Commonwealth Attorney to review the civil forfeiture proceedings against the Defendants’ property which included the 2006 BMW M5 with a listed value of $90,014. (N.T. pg. 34-35).

40. Exhibit 5 was the affidavit Detective Childress swore out concerning the civil forfeiture of vehicles, television, cameras etc. (N.T. pg. 36).

41. Corporal Leo Hannon testified that the Pennsylvania State Police secured arrest warrants for Harlow Cuadra and Joseph Kerekes between 9:30 and 10 a.m., May 15, 2007. (N.T. pg. 109).

42. Corporal Leo Hannon testified that Sergeant Winn advised him that the Defendants were possibly absconding as they had bags or “luggage” with them.