Federal prosecutors have accused a man they say is one of Baltimore's most notorious drug dealers of laundering the profits of his heroin-selling operation through the Maryland State Lottery, Las Vegas casinos and a local used-car dealership.
The allegations against Steven Blackwell, laid out in a revised indictment Wednesday, are the most detailed glimpse yet into Blackwell's dealings, which police believe led to a spate of deadly violence in the city throughout 2008 and 2009.
Blackwell is accused of conspiring with Joy Edison, an Elkton woman, to purchase winning Maryland State Lottery tickets from the actual winners and collecting the winnings from the lottery agency. In a five-week period in 2008, the indictment claims, Edison received three checks from the Maryland State Lottery totaling $15,000.
It was unclear from the indictment how Blackwell and Edison found the lottery winners and purchased their tickets. When asked about the case, officials at the Maryland State Lottery would say only that the agency "complies with all laws and requests from federal and state authorities."
In addition, the pair conspired to hide "income in the millions of dollars from the illegal sale of heroin in Baltimore City" from the Internal Revenue Service, "thus preventing the IRS from properly assessing taxes due and owing the United States," the indictment states.
Blackwell and Edison were indicted on drug charges in August last year, along with a third conspirator, Tahirah Carter, though the financial conspiracies were not laid out in the previous indictment. A re-arraignment proceeding for Carter was held in federal court in December, but it was closed to the public, and her defense attorney and the prosecutor declined to comment on Carter's case at the time.
Documents filed in U.S. District Court place Blackwell at the center of a widening circle of violence in East Baltimore throughout 2008 and 2009 that includes a shooting at a backyard cookout in which 12 people were injured, including Blackwell, a toddler and a pregnant woman.
Though Baltimore police for years suspected Blackwell of being one of the city's biggest drug dealers, he stayed largely above the fray and out of reach of police and prosecutors until his arrest and indictment in August. Federal authorities are also now trying to seize more than $10 million from Blackwell.
In addition to the lottery ticket allegations, Blackwell is accused of purchasing more than $80,000 in playing chips from The Venetian, a Las Vegas resort and casino, throughout 2007 and 2008.
Ron Reese, a spokesman for the hotel, declined to comment specifically on the Blackwell case, but said "Certainly, if federal authorities asked for information it would be provided."
Blackwell and Edison are also accused of laundering some of their income through the Carz Unlimited car dealership, formerly located on Reisterstown Road, in return for checks from the dealership. In 2006, the indictment states, Edison purchased a 2006 Mercedes-Benz from Valley Motors in Cockeysville, and paid for the car with a $66,000 check from Carz Unlimited.
Allan Shapiro, the chief financial officer for Valley Motors, said the practice of other car dealerships purchasing vehicles from them is "unusual," but likely would not have drawn suspicion at the time.
"To our eyes, it just looks like another transaction," said Shapiro, who said he recently provided information on the 2006 sale to federal prosecutors looking into Edison's activities. "I looked at the deal file and, frankly, everything kind of looked innocent to me."
If the dealership had known that the money used to pay for the car was possibly earned from drug activity, "that would have been money-laundering," Shapiro said. "We couldn't have even accepted the money."
Edison also received checks from Carz Unlimited throughout 2008 totaling $15,000, the indictment states.
Blackwell's criminal background
The brief court filing in U.S. District Court indicates for the first time the scope of Blackwell's alleged drug empire and links him to two real estate companies that own property in East Baltimore and a home along the Elk River in Cecil County that was purchased for $740,000.Authorities have labeled Blackwell, 26, a key player in a violent drug feud that began with the abduction of his two younger brothers and included a quadruple shooting outside an appliance store and a shootout at a backyard cookout that injured 12 people, including Blackwell.
Despite his reputation, Blackwell, also known as "J.R.," hadn't faced serious charges since he was 17 years old. He was picked up in New York last week after being indicted along with co-defendants Tahirah Carter, 34, and Joy Edison, 24, whose roles have not been spelled out.
Court papers and state business records show that Blackwell and Edison are linked to two real estate companies, JJM Realty LLC and J. Edison Properties, which own property in the Oliver, Berea and Johnston Square neighborhoods that were purchased between Aug. 29, 2008, and Jan. 6, 2009. According to assessments, they appear to be vacant homes.
State records show that JJM is registered in Blackwell's name for the purpose of "buying, selling and renting properties," while J. Edison properties dissolved last year after failing to file proper paperwork.
The Cecil County home is in a new development along the Elk River, with 35,000 square feet of property, and the title is in Edison's name.
Federal prosecutors filed a document Tuesday giving notice that they intend to seize "any and all property obtained directly or indirectly" as a result of drug dealing, including $10 million in U.S. currency.
Blackwell has yet to make an appearance in Maryland court, and details of the allegations remain unclear. But a news release from the U.S. attorney's office announcing the indictments indicated a wide range of agencies working on the investigation, including the IRS, FBI, city and state police, city prosecutors and New York's Drug Enforcement Agency.
In April 2008, Blackwell's two younger brothers were abducted by masked gunmen from their Catonsville home by rival drug dealers who thought Blackwell was cheating them on the price of heroin, according to documents previously filed in federal court by an agent for the Bureau of Alcohol, Tobacco, Firearms and Explosives. Blackwell paid a $500,000 ransom to free his brothers, the records show.
Six weeks later, authorities said, gunmen took revenge with a quadruple shooting outside the Allen & Family Appliance store, a discount appliance shop in East Baltimore. The store was operated by the family of Terrell Allen, described by law enforcement officials as a drug dealer who took part in the Blackwell kidnapping. The shooting killed Allen's father, Tony Allen, 52, and a 27-year-old named Omar Spriggs. Terrell Allen and another man were injured.
In the months that followed, several Blackwell associates were killed. Then on July 26 of last year, gunfire rang out at a backyard cookout in East Baltimore held to commemorate their deaths. Twelve people were shot and wounded, including Blackwell, a pregnant woman and a 2-year-old girl.