Alleged Ties Between Rap Label, Drug Dealer Probed

The Justice Department is ratcheting up its investigation of Death Row Records, attempting to determine whether the seed money used to launch the company came from convicted Los Angeles drug kingpin Michael “Harrio” Harris, sources said.

Over the last three weeks, agents from the FBI, IRS and the Bureau of Alcohol, Tobacco and Firearms have conducted extensive interviews with West Coast music executives asking questions about Harris and his alleged business ties to Death Row owner Marion “Suge” Knight, sources said.

Harris, who is serving a 28-year sentence in Lancaster State Prison for drug dealing and attempted murder, declined to comment. But in a 15-page document first made public in the LA Weekly newspaper, Harris stated that he put up $1.5 million to underwrite the start-up of Death Row in 1991.

Knight, who is serving a nine-year sentence at the California Men’s Colony in San Luis Obispo for an assault probation violation, could not be reached for comment but told The Times in December that Harris played no role in the launch of his wildly successful Los Angeles rap label.

State records indicate that Harris’ wife, Lydia, and Knight’s attorney David Kenner filed incorporation papers five years ago to establish a firm called GFE Inc. (for Godfather Entertainment). Harris contended that Death Row was a division of GFE, though Kenner disputes that.

Seventeen months ago, Harris sent a letter to Interscope Records executives, contending in an unfiled lawsuit that Harris had helped fund Death Row. The letter threatened to take legal action against Interscope and Death Row. Sources said Interscope eventually paid Lydia Harris about $300,000 to resolve the matter. Death Row ignored the demand and has not been sued.

Over the last four years, Lydia Harris has launched two other record companies, the latest of which opened its doors just six months ago on Wilshire Boulevard in West Los Angeles. On Tuesday, New Image Entertainment, her latest venture, is set to release its debut single, “Closer Than Friends,” a song on which the 29-year-old Harris performs under the stage name “Ms. Lydia.”

In an interview this week, Harris scoffed at speculation in music industry circles that her husband provided the seed money for New Image’s launch.

“This is my record and this is my label,” said Harris, whose music will be marketed through a deal with Marietta, Ga.-based Alexia Records and its distributor Ichiban Records. “Michael loves it that I have a new label, but he doesn’t have anything to do with it. I started it with my own money--money that I saved from other deals that I made on my own in the past. I’m very excited about getting this company off the ground. This record is going to be big.”

“Closer Than Friends,” which features a performance by Surface, is the first single from “Life After Evolution,” a compilation collection due out July 14 that will showcase a dozen new rap and R&B; acts signed to the New Image label.

Harris says that many of the artists on New Image’s roster are holdovers from her now-defunct Lifestyle Records, which was opened in 1993 and closed two years later. Before Lifestyle folded, the company scored a minor hit in 1994 with rapper Dana Dane, which was released through Madonna’s Maverick Records label, a Time Warner joint venture.

Sources at Maverick said the company cut a deal with Lydia Harris’ Lifestyle label but never had any dealings with her husband. Harris says Maverick cut ties with Lifestyle in 1995 following the rap controversy that prompted Time Warner to dump Interscope.

Harris declined to say where the funding for Lifestyle and New Image came from, except to say that it was generated from a variety of deals she has cut over the last four years. She said she sunk about $100,000 last year into recording the upcoming compilation album and runs New Image on a tight budget with only four employees.

Justice Department officials have routinely declined to either confirm or deny the existence of a Death Row probe. Law enforcement sources said, however, that since last fall, officials have been trying to determine whether the company is being run as a criminal enterprise with ties to street gangs.

Some sources believe the department hopes to seize Death Row by proving that it was founded with drug money. If so, it would be a new approach by investigators; the government never investigated the highly successful Ruthless Records rap label despite repeated public boasting by its owner, Eric “Eazy-E” Wright, that he had launched the company with proceeds from his drug-trafficking days.

Law enforcement sources would not address speculation in the rap community that Michael Harris is cooperating with the probe. Lydia Harris, however, insisted that he has not aided investigators.