marijuana3.JPG

This 2011 file photo shows medical marijuana clone plants at a medical marijuana dispensary in Oakland, Calif.

(AP Photo)

Government lawyers are bearing down on the former principals of an Oregon accounting firm, accusing them of illegally shipping marijuana across state lines, misappropriating the trust fund of two porn shop heirs and ripping off legendary two-time Olympic snowboarding medalist Danny Kass.

Tax attorney Jeremy Swanlund and CPA Nathan Wheeler, formerly key figures in Milwaukie-based Bridge City Advisors, allegedly paid clients to obtain state medical marijuana cards so they could grow and sell bulk shipments of cannabis, according to court papers filed in Portland's U.S. District Court.

"Wheeler and Swanlund are growing substantially more marijuana than the (Oregon Medical Marijuana Program) allows," according to a 27-page declaration by IRS Special Agent Scott McGeachy, a document intended to show probable cause to forfeit property suspected of being the fruits of crimes.

To be sure, U.S. prosecutors have not filed criminal charges against Swanlund, Wheeler or their associates. But Assistant U.S. Attorney Katie Lorenz has filed a civil forfeiture complaint that preserves the government's right to claim property on behalf of those allegedly cheated out of it.

Wheeler could not be reached for comment, and Swanlund declined to comment on the allegations. But Swanlund's Portland lawyer, Ron Hoevet, said he doesn't think the government can produce any evidence that his client was involved in the illegal distribution of marijuana.

"I believe he's innocent," Hoevet said. "I don't believe he committed any crimes at all."

McGeachy alleges that Wheeler and Swanlund, who no longer work for Bridge City Advisors, distributed marijuana to states such as Washington, Idaho, Wisconsin and New Jersey. His court filing suggests that drug proceeds filtered into Wheeler's shell company, TWG Advisors.

It's not clear when Wheeler and Swanlund first fell under scrutiny.

But in November 2013, a state trooper in Utah stopped a rental car carrying 23 pounds of marijuana and eight vials of an unspecified white powder, according to the declaration. The driver was a courier for a man whom federal authorities accuse of tending Wheeler's pot plantations in Gresham and Happy Valley.

Investigators searched Wheeler's Happy Valley home on Feb. 5, 2014, finding 282 cannabis plants taller than a foot and 40 more under that height, the government alleges. The residence was a registered grow site for 19 medical marijuana patients, but had far more cannabis than was allowed for that number of card carriers, McGeachy wrote.

"During the search, officers discovered one pound of marijuana inside of Wheeler's 2013 GMC Sierra ... along with an assault rifle," the IRS agent noted. "Further research has shown Wheeler purchased the vehicle with funds that were misappropriated."

Those funds, he wrote, came from two places.

One of them was snowboarding legend Danny Kass, who won silver medals in the halfpipe in the 2002 and 2006 Winter Olympics and six other medals in the X Games. Kass, who runs a Portland outerwear business called Grenade Inc., appears to be an unwitting victim of Wheeler, whom he hired to handle his finances and prepare his tax returns, court papers suggest.

"Wheeler misappropriated a $40,000 check from Kass that had been made payable to Oregon Department of Revenue," the declaration alleges. "The check was deposited into TWG Advisors just prior to Wheeler's purchase of the 2013 GMC Sierra out of the same account."

Kass, reached at his Southwest Portland business Tuesday, said investigators from the IRS and Portland police interviewed him about the case last June. He declined to elaborate on the questioning. But he acknowledged he has not yet gotten his $40,000 back.

"Obviously," he said, "it's a sore subject."

Investigators appear to have drilled down on Wheeler's dealings in a home development project in Rainier, Washington, called Trotter Downs Phase II.

A Rainier businessman, Greg Myers, spent 2006 and 2007 building and selling 56 houses in the Trotter Downs Phase I development. But things went bad for Myers in December 2011, when a Seattle builder backed out of the Phase II development and West Coast Bank called in a $735,000 loan.

"Myers was going to file Chapter 11 Bankruptcy, but sought out a hard money loan through his friend Howard Wheeler," a mortgage lender who happened to be the brother of Nathan Wheeler, according to McGeachy's declaration.

Howard Wheeler introduced Nathan Wheeler to Myers, saying his brother had the financial ability to buy out the line of credit and fund construction of 44 residential homes in Trotter Downs Phase II, the declaration states.

Myers and the Wheeler brothers entered a partnership, which ended bitterly. Forty-one residential lots ended up in Nathan Wheeler's company, TGW Advisors, based in Thurston County, Washington, records show.

So where did Wheeler get the money to buy out the West Coast Bank loan, and what did he do with it?

McGeachy's declaration lays out the government's allegations:

One of the people to whom Nathan Wheeler provided CPA services was David Coverdale, owner of a Portland area porn shop called DK Wilds. Two days before Coverdale's death on April 21, 2011, Wheeler and Swanlund met with him to craft a new will that would leave the adult entertainment businesses to a trust in the names of Coverdale's two sons.

Wheeler, who had served as Coverdale's CPA, was named trustee. He was responsible for selling Coverdale's assets, which included his home and the porn shop property and building.

According to the court document, Wheeler wired $737,502.16 from the Coverdale estate to West Coast Bank to buy out that line of credit on Trotter Downs Phase II. But while Wheeler took the majority of proceeds from sales of the first three houses in the development, he never reimbursed the trust that Coverdale established for his sons.

The IRS declaration accuses Wheeler of lying to the mother of one of Coverdale's heirs, telling her that the trust had been frozen due to a $12 million lawsuit in which two boys accused employees and customers at DK Wilds of molesting them in the "video viewing booths" of the business.

Then, according to the documents, Wheeler used much of the remaining Coverdale funds to charge airline tickets, spend the night in the Hard Rock Hotel in Las Vegas, buy expensive meals at such spots as the Bridgeport Grill, and spend time at a strip joint (Stars Cabaret).

Wheeler also wired money into Swanlund's bank account, according to the document, and made a loan to their joint business (the now-defunct Club Rouge, a Portland Gentleman's Club), gave $3,960 to his ex wife and $4,000 to his fiancee.

-- Bryan Denson

503-294-7614; @Bryan_Denson