Fowlie Firm Had Cash, No Contracts, 2 Say : Drug trial: Witnesses say they saw thousands of dollars in offices of Dutch oil company allegedly used to launder money.

A Dutch oil company allegedly used by Daniel James Fowlie to launder profits from an enormous Orange County drug smuggling ring was flush with cash although it never secured any contracts to ship crude oil, according to testimony in U.S. District Court here Tuesday.

Two witnesses, one of them a police investigator, from the port city of Rotterdam in the Netherlands told jurors about hundreds of thousands of dollars being on hand at the headquarters of Tencoil Europa B.V. and about documentation indicating that Tencoil conducted no business transactions.

Federal prosecutors are contending that Tencoil, which had offices in Laguna Beach and Rotterdam, was nothing more than a conduit for proceeds from Fowlie’s alleged drug smuggling operation at Rancho del Rio, a rustic enclave on the Orange-Riverside County line.

Assistant U.S. Atty. Elana S. Artson and her co-counsel, Special Assistant U.S. Atty. James Dutton, focused their questions Tuesday on specific allegations that more than $1 million was laundered in the Netherlands during the mid-1980s. Prosecutors say all of it was shipped from the United States in suitcases and that none of the overseas cash transfers were reported to federal authorities.

The charges of failing to file the reports are part of a 26-count indictment that alleges that Fowlie, 58, evaded income taxes, distributed 53,000 pounds of marijuana and operated a continuing criminal enterprise. The trial, before Judge Alicemarie Stotler, is in its third week.

Defense attorneys James Riddet and Michael Abzug argue that Tencoil, which produced an annual report and glossy brochures, was a legitimate business trying to secure tanker contracts to ship oil from Nigeria to various places.

But Peter J.M. de Vette, a Rotterdam detective assisting U.S. authorities in the case, testified that his review of Dutch bank records and company documents showed that Tencoil had no oil shipping contracts during the year it operated.

The other Dutch witness, Bernard Brouwerens, managing director of Vinke, another Rotterdam shipping company, said that Tencoil had hundreds of thousands of dollars in its offices and usually paid its bills in cash. According to his testimony, Vinke, besides researching oil tanker rates and schedules, often made travel arrangements for Fowlie and Tencoil employees.

Under questioning by Dutton, Brouwerens told the jury that at Fowlie’s request, his firm once exchanged gilders for $50,000 in cash that was brought to his company in a suitcase.

On another occasion, Brouwerens recalled that he saw $300,000 in cash in Tencoil’s suites. He quoted the company’s employees as saying the money was needed to bribe Nigerian officials who were helping them secure an oil contract.

Brouwerens testified that his firm’s work to find tankers for Tencoil never resulted in a contract and that Fowlie was behind in his payments to Vinke for having arranged flights for him and his associates around the world.

During cross-examination by Riddet, Brouwerens said that according to his knowledge of the oil shipping industry, bribes of Nigerian officials were common and that many oil shipment contracts fall through. He also testified that Fowlie’s travel arrangements took him to places such as London and Switzerland that were centers for chartering vessels.

“So he was on the right track then?” Riddet asked.

“I wouldn’t say he was on the right track,” Brouwerens said. “There are many people who misrepresent their authority and take your money after saying they will do something for you.”

Turning to Fowlie’s alleged operations in the United States, prosecutors presented evidence seized by Orange County sheriff’s deputies during a raid on Rancho del Rio on March 1, 1985. Investigators believe the ranch off Ortega Highway near Ronald W. Caspers Wilderness Park was the hub of one of the largest marijuana operations in the country in the mid-1980s.

Displayed on a table in front of the jury was a money counter, a large vacuum cleaner, a counterfeit-bill detector, an electronic device for sealing plastic bags, a television carton that had marijuana residue, two bullet-proof vests, and an Uzi assault rifle, the semiautomatic version of a popular Israeli infantry weapon. The vests were seized from a living room hutch; the Uzi, from under a seat nearby.

On a courtroom bulletin board were displayed aerial photos of Rancho del Rio, schematics of ranch structures and an enlarged photograph of a secret fiberglass tank accessible through a trapdoor in the floor of a ranch warehouse.

Sheriff’s Sgt. Albert Kouttz , a veteran narcotics agent, told the jury that when he opened the trapdoor during the search, an odor of marijuana wafted up the stairwell. He said the long tank was higher than he is tall and that he could not reach across it with both arms outstretched.

Although no large amounts of marijuana were found, Kouttz said that there was marijuana residue on numerous Hitachi television cartons that are believed to have been used for shipping marijuana to Rancho del Rio.

The defense seized upon that fact to contend that the amount confiscated, apparently no more than an ounce, was hardly an indication of a major marijuana smuggling operation.

“Wasn’t the amount consistent with personal use?” Abzug asked.

“If you put it that way, yes,” Kouttz told the jury.

But then under questioning by prosecutor Artson, Kouttz testified that the items seized at the ranch could not be associated with personal use of the drug. “They are consistent with large-scale trafficking of marijuana,” he said.

The defense also focused on the fact that Fowlie was not present when the raid occurred and on the apparent lack of investigation into whether Fowlie owned the incriminating items deputies seized.

Sheriff’s Sgt. Michael Hollos, who participated in the raid, testified that he did not know who bought or owned the items at the ranch and that to his knowledge there was no tracing of ownership.