The federal government charged the owners and employees of a Woodinville moving company with conspiracy, wire fraud and extortion this week, saying they held customers' possessions until they agreed to pay an inflated price for moving them.
According to a complaint the U.S. Attorney's Office filed Monday, the owners of Nationwide Moving and Storage, Erik and Tanya Deri, lured customers by offering low estimates. Then, after movers packed people's possessions into trucks, they demanded money — double or more than the estimated cost of the move. They threatened to keep customers' belongings if they didn't pay, and sometimes they threatened to unload possessions onto the street and then charge customers an unloading fee.
The company rewarded its employees with cash bonuses when they got customers to pay more than their estimate, according to charging papers. One month, the company made $75,000 in profits, a former employee told federal prosecutors.
The federal complaint names the Deris, who are married, as well as Yuval Derei, an illegal immigrant and supervisor at the company who prosecutors believe is Israeli national Erik Deri's brother; Joe Naham, a supervisor for the company; Michael Airgood, a packer and foreman; and Kristen Klein, a secretary for the company.
"The government is attempting to criminalize ... basically business disputes that occurred during the normal course of business," said Jim Frush, the Seattle attorney who represents Tanya Deri.
Frush does not think his clients should have been arrested. Erik and Tanya Deri and Yuval Derei are being held at the Federal Detention Center in SeaTac. Airgood and Klein also were arrested, but they have both been released.
Frush said the federal charges are based on accounts by disgruntled customers and employees whose allegations have never been tested in court.
"These arrests really took us by surprise," he said.
After The Seattle Times published an article about the movers in March, a branch of the federal Department of Transportation charged Nationwide with six violations and ordered the company to shut down, and the Washington Utilities and Transportation Commission refused the company a permit to operate as an in-state mover. In the court papers filed this week, federal officials said their investigation started after an agent read The Times' story.
Nationwide customers said they had to live for months without any furniture while they argued with Nationwide officials over prices. One customer, Gloria Blanchard, told investigators the movers loaded her possessions in January but then charged her more than twice their estimate and demanded payment immediately. But when she went to get her checkbook, she couldn't find her purse. The movers had put it in the cab of their truck.
Blanchard paid more than she had planned but eventually got her things back. She told investigators she believes her computer had been assembled and used while it was being stored by Nationwide.
One of the customers contacted by federal investigators was John Jennings, a former Issaquah resident who said his move to Florida last September was spoiled by Nationwide.
Jennings said the company, which has been in business for more than a year, revised the price upward from $3,000 to $16,000 — and then refused his request to unload his possessions after he objected. Ultimately, the total cost of his move, after hiring a different company to retrieve, move and re-store his possessions, exceeded $11,000.
Informed yesterday of the charges, Jennings said, "They got exactly what they deserved. ... I think it's only fair that (the government) file charges and make sure they are held accountable for their actions."
Investigators talked to a former Nationwide employee who told them Erik Deri told employees to underpack boxes and use extra packing paper, then charge customers for the materials.
Deri also instructed movers never to park the truck on the customer's property in case the police were called.
The former employee said Nationwide's motto was "screw the customer," according to court papers.
He also said he had seen Erik Deri stealing porcelain eggs and figurines from a customer's shipment and that Nationwide employees would sometimes drag furniture across pavement, intentionally break the legs off tables and chairs, kick boxes and gouge furniture with "various items."
Despite the charges filed after The Times' story, this week's complaint says, the company continued to operate illegally and was in the process this spring of changing its name either to American Star Moving and Storage or Northstar Moving and Storage.
Federal prosecutors said that their investigation is continuing and that people with more information about the company should call Mary Brown, victim witness coordinator at the U.S. Attorney's Office, at 800-797-6722.
Seattle Times staff reporter Peter Lewis contributed to this report.
Emily Heffter: 425-464-2420 or firstname.lastname@example.org