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Broker Linked to Drug Money Receives 15-Year Term in Prison : Sentencing: Real estate agent bought houses for a drug ring. Investigators found millions, including money in a buried safe.

August 25, 1991|BETTINA BOXALL | TIMES STAFF WRITER

A Long Beach real estate broker has been sentenced to 15 years in federal prison for her role in laundering money for a nationwide, multimillion-dollar drug ring based in Compton.

Lula Mae Hobbs was convicted in May and sentenced Aug. 15 in U.S. District Court in Los Angeles on charges that she used her position as a real estate agent to help members of the narcotics ring conceal assets by purchasing houses for them in various Southern California communities.

Hobbs, a 44-year-old Seal Beach resident and owner of L.J. Metz Realty in Long Beach, bought four houses in middle-class neighborhoods and also attempted to purchase a San Pedro strip mall, according to federal prosecutors.

The drug operation she worked with was a highly lucrative one that supplied large amounts of cocaine and PCP to buyers in Washington, D.C., Hawaii, Texas and Oklahoma as well as Southern California.

When investigators last year raided a home in Orange purchased for the ring by Hobbs, they found nearly $1.6 million in a safe buried under the cement patio. Another $1.7 million was seized by law enforcement officers as it was being driven from the South Bay to San Diego. A safe was also buried in the floor of Hobbs' house, but it was empty when searched.

Patrick Johnson, convicted leader of the narcotics ring, has agreed to forfeit to the federal government more than $8 million in property, jewelry and money, according to prosecutors in the Hobbs case, said Monica Bachner and Jeffrey Sinek, assistant U.S. attorneys.

Arrested in 1990, Johnson and seven other members of his ring pleaded guilty to narcotics and tax fraud charges in April. Under terms of the plea agreement, Johnson will be sentenced later this week to 30 years without parole.

According to evidence presented in Hobbs' four-week jury trial in Los Angeles, between 1985 and 1987 she bought four houses ranging in price from about $150,000 to $255,000. She would make generous down payments using cashier's checks purchased in amounts of less than $10,000--so as to skirt bank reporting requirements to the federal government. Members of the ring, including Johnson's sister, lived in some of the houses, which were located in Orange, Moreno Valley and Harbor City.

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