S. Lake Tahoe Mayor Accused in Drug, Money-Laundering Case

Undercover federal agents using wiretaps, videotapes and paid informants gained entry into an elaborate, statewide drug distribution and money-laundering network that included South Lake Tahoe Mayor Terry Trupp and his wife, Kimberly, according to court documents made available Tuesday.

The detailed court filings--affidavits used to support the multiple arrests--provide an insight into Trupp and the workings of illicit drug trade centered in the resort communities around Lake Tahoe, with money and cocaine being shuttled among suppliers and dealers in Orange County, Palm Springs and San Diego.

The accusations about the Trupps have stunned residents of the bustling Lake Tahoe resort city where Trupp presided as mayor. There had been whispering about his life style--about the source of his income, his yellow Maserati and fast motorcycles and his recent marriage to his 24-year-old former stepdaughter. But few suspected that the 46-year-old part-time politician was caught up in the shadowy underworld of cocaine trafficking, as he is described in the court documents.

“He’s a flamboyant personality. He’s a loner,” said Neva Roberts, the mayor pro tem of South Lake Tahoe. “I don’t know who his friends are. He’s somewhat of an enigma.”

An elaborate undercover operation--code-named “Deep Snow”--led to the arrest of the Trupps and 17 others, including a South Lake Tahoe chiropractor, Glenn Clifford Miller.

The chiropractor has been accused of dispensing kilograms of cocaine--allegedly calling them “bottles of vitamins”--along with therapy to a government informant who was sent to Miller for treatment of a bad back.

Remain at Large

Criminal complaints have also been filed against three other suspects who remain at large after a 20-month investigation conducted by the FBI, the Internal Revenue Service, the Drug Enforcement Administration, U.S. Customs and South Lake Tahoe police. One of the suspects is Thomas Tamez, who allegedly acted as Terry Trupp’s bodyguard and partner in laundering $655,000 in “drug money” provided by undercover agents.

Trupp told undercover IRS and FBI agents that “he had a method to launder money out of the country that left no paper trail and no tax liability and that the system had been in place for 20 years,” according to one affidavit.

At times packing a Smith & Wesson semiautomatic pistol in his briefcase, Trupp picked up cash from bus stations in San Diego and again in Stateline, Nev., in red canvas bags, according to the court papers. In one case, two other defendants were said in the documents to have personally transported $250,000 in cash passed to them by Trupp from Los Angeles to the island of Antigua.

For his trouble, Trupp was paid $48,500 in commissions.

The court papers reveal a world of fast cars, private planes and weapons stashes. Always worried about detection, those accused of dealing drugs and moving their money into bank accounts are said to have gone to elaborate lengths to avoid being caught.

One of the defendants, Robert Moon, allegedly a drug courier, was a former telephone company employee who provided security for others involved in drug activity, according to the documents.

Earlier this month, Moon allegedly delivered a kilogram of cocaine, wrapped as a baby shower gift in paper with blue and pink lambs on it, to a government informant.

But the South Lake Tahoe mayor and his young wife remain the center of attention in the investigation.

Wearing gray sweat shirts with “Sac Co. Prisoner” stenciled on the back, Terry and Kimberly Trupp made a brief court appearance Tuesday. The two are charged with two counts of money laundering and distributing cocaine.

The scheduled hearing was intended to determine what bail if any would be required to obtain their release. But attorneys for the Trupps asked for a delay until later in the week.

Trupp is the second elected official in the Sierra Nevada county of El Dorado to be arrested in a drug case within the past year. Last October, El Dorado County Supervisor Michael C. Visman was charged with raising a marijuana crop at his apple ranch. His trial is scheduled for July.

Trupp’s arrest surprised those who knew him in South Lake Tahoe, a resort community that still thinks of itself in many ways as a small town. Yet several of Trupp’s associates interviewed Tuesday conceded that they knew very little about the man who lived in a modest, ranch-style home near the Heavenly Valley ski resort, not far from the state line casinos, and was a member of the local Mormon church.

“This is someone I thought I knew--that’s the shock of the thing,” said lawyer Kenneth C. Rollston, who first met Trupp in the mid-1970s when they were on opposite sides of the battle over the Tahoe Basin’s regional government. “I want to wake up and find out the whole thing was a bad dream.”

Rollston, who worked with Trupp on a development business deal and served as his divorce lawyer, said he was never really certain what the mayor did for a living.

Financial Forms

On financial disclosure forms filed with the state, Trupp reported receiving at least $10,000 a year from 1983 until 1986 from the Heavenly Valley Resort Hotel, for which Rollston worked as corporate attorney.

“He was a consultant,” Rollston said. “Presumably, he was doing something. What that was, I don’t know.”

Ed McCarthy, a local hotel owner and longtime friend of Trupp, was the best man when Trupp married his fourth wife, Kimberly, the daughter by a previous marriage of his third wife. Yet McCarthy also was unsure of how his friend earned a living.

“I always assumed he had benefits that came to him from investments he made with his brother in Southern California and New Zealand,” McCarthy said.

It was McCarthy who helped Trupp get his start in public life when, in the mid-1970s, he brought him into a coalition fighting the creation of the Tahoe Regional Planning Agency, which was designed to control rapid growth at the pristine lake. Opponents of the agency argued that it would usurp private property rights by taking away the powers of the city government.

Trupp served several years as executive officer of the Council for Logic, as the group became known. Then, in 1978, he ran for and won a seat on the South Lake Tahoe City Council.

One of the incumbents Trupp defeated in that election, Patricia Lowe, was later elected to the El Dorado County Board of Supervisors. When Trupp ran against Lowe in 1984, she challenged him to reveal the sources of his income, which even then were a subject of some mystery.

“He had listed a number of occupations and experiences, and it seemed to vary,” Lowe said Tuesday. “It seemed proper to ask, ‘Who is Terry Trupp? What does he do?’ ”

Trupp reported no income during 1987 and 1988 on his financial disclosure forms, and he was again confronted with the question in an April 10 interview published in the Tahoe Daily Tribune. He said then that he had not worked steadily since a 1986 motorcycle accident and that his brother was helping to support him.

In the interview, Trupp said he was trying to broker letters of credit with the Bank of China and to work in the currency trading business.

“I know one right now I’m trying to fill with a guy who wants to buy $250 million a day in yen, four days a week,” he was quoted as saying.

McCarthy described Trupp as “extremely bright” and an “enormously talented politician” who could have moved on to higher office.

Paul Jacobs reported from Sacramento and Daniel M. Weintraub from South Lake Tahoe.