Crime troubles continue for Hewitt Avenue investor

  • Wed Aug 29th, 2012 5:32pm
  • News

By Scott North

Everett is known for its lack of monuments to movers and shakers.

That meant the odds always were long that a statue or plaque ever would be raised in honor of Craig Douglas Dieffenbach.

Back in 2001 people were talking about the real estate investor in reverent tones. He made headlines for buying up decrepit buildings along Hewitt Avenue. He wasn’t shy about claiming the nickname “Hollywood,” nor was he stingy with big talk about the economic miracle he planned.

Those development dreams didn’t bear fruit. Instead, Dieffenbach has received the most attention in recent years for messy litigation over a plan to market vodka named after guitar legend Jimi Hendrix.

On Aug. 20, Dieffenbach, 61, was back in the news for pleading guilty to federal drug charges.

He admitted that the medical-marijuana dispensaries he’s been running in King County were just fronts for a multi-state conspiracy involving drug trafficking and money laundering. His sentence now hinges in part on how willingly he throws his partners under the bus.

“These drug fronts had little to do with ‘compassionate care’ and everything to do with lining their own pockets,” U.S. Attorney Jenny A. Durkan said in a press release. “While we will not prosecute ill people or their true care providers, we also will not let common drug dealers masquerade as something they are not.”

The federal probe was no secret. It was mentioned in Snohomish County Superior Court papers last year after Dieffenbach was charged with operating an indoor marijuana-growing operation at his Arlington-area home.

Drug trafficking is not a new line of work for Dieffenbach either. We stumbled on the evidence more than a decade ago while checking his legal paper trail for business stories about his Hewitt Avenue foray. Documents in a divorce case showed that for part of the 1990s Dieffenbach’s mailing address was the federal prison in Lompoc, Calif. More digging led to previously sealed court records that detailed his stint as a federal informant after being busted for cocaine dealing in Washington and California.

Dieffenbach cut a deal in that case, too. He disappointed the feds, promising big fish but instead delivered guppies.

We angered some in 2001 by reporting what we found. It was relevant then because Ed Hansen, Everett’s mayor, was engaged in the unusual task of personally wresting away from Dieffenbach the property where Comcast Arena now stands.

Dieffenbach bought the land as the city zeroed in on where it would build the arena. Coincidence, Dieffenbach said; he had no plan to profit. But when it came time for the city to buy, the price tag had shot up several hundred thousand dollars. Hansen was not amused, and demanded expensive concessions.

For his part, Dieffenbach negotiated to have his name appear on a plaque, or with a statue or fountain at the arena.

A decade later, there is no visible evidence that part of Dieffenbach’s dream came true. Instead, he’s once again facing prison time.