A city grand jury is investigating the Baltimore liquor board, following claims that inspectors took bribes from Block bar owners and that a board member was a secret partner in one of the tawdry dance clubs, according to court records and interviews.
The grand jury has subpoenaed thousands of documents from the board, a state agency. It demanded the personnel files of employees who inspected the clubs between Jan. 1, 1990 and Jan. 14, 1994 -- the day state troopers hit The Block in a highly publicized drug raid.
The panel also subpoenaed inspection reports, board rules, training manuals and all records of violations, fines and penalties imposed on 22 clubs along East Baltimore Street and one bar on Eutaw Street, according to a copy of the subpoena provided to The Sun.
The Baltimore City Board of Liquor License Commissioners complied with the subpoena several weeks ago, providing cartons of documents to prosecutors and police investigators, said Aaron L. Stansbury, the board's executive director.
"We're not exactly sure what they're looking for," he said.
Several inspectors said this week that they haven't done anything wrong, and board Chairman George G. Brown said he was unaware of any wrongdoing within the agency. Neither the prosecutor nor state police officers -- who were questioning defendants in the Block case about the liquor board as recently this week -- would discuss the grand jury investigation.
"All I'm going to say is 'No comment,' " said A. David Copperthite, the assistant state's attorney handling the probe.
"It's part of a continuing investigation, and we really can't comment," said State Police spokesman Lt. Greg Shipley.
With a $1.1 million budget and 45 employees, the agency is responsible for inspecting and licensing 1,650 bars, restaurants and other establishments that serve alcohol in the city. It has three board members, and 33 full- and part-time inspectors, all political appointees.
Board members have broad discretionary power to enforce liquor laws. Based on inspection reports and complaints, they can levy fines, suspend licenses and close establishments that break the law or state regulations.
During the recent State Police drug investigation of The Block, undercover troopers said they were told that the bars were protected by liquor board employees -- through bribes to inspectors and through a secret business connection to one of the board members, court records show.
"An undercover trooper was told by a close associate of several bar owners that several bars avoid problems with the liquor board by paying off four liquor inspectors," state police wrote in a sworn search warrant affidavit drafted for the Jan. 14 raid. "A manager of a bar on the 'Block' advised an undercover trooper that a member of the liquor board was a silent partner in the ownership of a bar on the 'Block.' "
None of the four inspectors nor the liquor board member was named in the affidavit. Police investigators refused to identify the employees or say what evidence they had developed to support the claims.
"We cannot discuss specifics because of the grand jury investigation," Lieutenant Shipley said.
'I would be shocked'
Mr. Brown, the board chairman, said he would cooperate with the grand jury investigation. "If there's anybody on that board who had a hidden agenda, I would be shocked," said Mr. Brown, who has served on the board for 16 years and earns $18,500 a year to preside over periodic hearings.
The other board members -- Curtis H. Baer and Charles E. Thompson -- did not return messages.
Before the undercover operation became public, state police troopers were careful not to tip off the liquor board.
When they needed to review liquor licenses for bars on The Block, they asked city police officers to gather the information.
During the Jan. 14 raid, state police confiscated thousands of corporate records from the clubs -- including receipts, balance sheets and other documents that would show who has financial control over the clubs and how much money the clubs make.
"The undercover troopers were told that the majority of the bar owners were not connected to their bars on paper," the affidavit says.
In recent weeks, troopers have been questioning dancers, bartenders and others arrested on drug charges stemming from the Block investigation and raid. They have been asking them if they knew whether liquor inspectors accepted cash from bar owners, sex from dancers or other favors in exchange for protecting the clubs.
Michelle Rollins, charged with selling $20 worth of cocaine to an undercover trooper, said state police officers interviewed her on Monday.
"They asked me if I knew about any payoffs, or of any sex, or free drinks, or if I knew if the liquor board guys were getting anything from the bars," she said. "They also wanted to know if we had been tipped off about the raid by the liquor board."