Mark Raymond Vogel, the prominent Prince George's County developer and racetrack owner arrested last week on cocaine charges, had known for months that he was the target of a federal drug investigation, associates and law enforcement sources said.
On the night of his arrest, Vogel, 42, went to a building in the District where authorities suspected he bought drugs, sources said. Agents from the U.S. Drug Enforcement Administration saw Vogel there and followed his late-model Corvette into Virginia, where at their request, Fairfax police stopped his car, sources said.
Four grams of alleged cocaine worth about $400 were found in Vogel's possession, sources said. Fairfax police arrested Vogel and charged him with possession of cocaine, a felony offense in Virginia. He was released on $10,000 bond. His attorney, Plato Cacheris, said Vogel will plead not guilty to the charge.
Federal law enforcement authorities say their interest in Vogel began as a routine drug investigation but evolved into a complex probe of land transactions involving a circle of prominent developers, lawyers and politicians.
Vogel owns two racetracks in Maryland, hundreds of acres of prime Prince George's County real estate, including the 345-acre Bowie New Town Center, as well as interests in high-profile and controversial projects such as PortAmerica.
As early as six months ago, agents from the DEA and federal prosecutor's office in Baltimore began questioning employees at the Mark Vogel Cos. and Vogel's business associates about his alleged drug use and land transactions, a former associate said.
Subsequently, Vogel met with authorities on at least one occasion before his arrest, sources said, although the extent of their discussion is not known. Coincidentally, the inquiry into Vogel's activities came about the same time former Prince George's County Council chairman James Herl pleaded guilty to cocaine possession charges.
Sources said that Herl was questioned about allegations that Vogel used drugs and about his involvement with county officials, but that the former County Council member was unable to provide any information. Law enforcement and other sources said Herl and Vogel had acquaintances in common, but did not associate socially or professionally with each other.
Federal authorities said they are hopeful that Vogel, whose network of government contacts was extensive, will lead them down other avenues of investigation.
Cacheris said speculation that Vogel will cooperate with a federal probe is "premature. At this point, we are contesting the charges, period. There is no reason for them to believe that."
Friends, associates and law enforcement sources who know Vogel painted a picture yesterday of an intense and frenetic man who knew that he was being watched.
A former business associate said that he asked Vogel if he were using drugs, only to be told that he was not. Close friends repeatedly had urged him to seek treatment, sources said. They said that Vogel could be charming and kind one moment and fly into a rage without warning the next.
Cacheris said that his client had dined with friends at the Prime Rib, a steak house at 20th and K streets NW, and was on his way to visit a friend in Virginia last Thursday when he was stopped by Fairfax police. Cacheris declined to comment on allegations of drug use by Vogel.
Vogel, the owner of Mark Vogel Cos. and a partner in more than 20 other Maryland corporations, presided over a vast real estate and racing empire that stretched from Virginia to New Jersey and brought him into contact with a host of government agencies.
With a keen eye for real estate, Vogel, who began his career as a broker, snatched up large parcels of speculative land at bargain prices and, in some cases, turned a quick profit by immediately reselling the properties to developers. From his private helicopter, which he keeps on a pad near his Bowie office, Vogel surveys projects that range from the gigantic $400 million Bowie New Town complex to the $3 million Tollhouse Shopping Center he built several years ago in historic Leesburg.
Vogel's political contacts were extensive, particularly after he ventured into the horseracing industry with the purchase of Rosecroft Raceway in Oxon Hill and Delmarva Downs in Ocean City. Although he infrequently attended races, he occasionally entertained state legislators at the track and gave lavish receptions for Prince George's County officials at a Rosecroft party room, according to track employees.
Vogel's holdings include a 3 percent interest in the long-delayed PortAmerica project in Oxon Hill, a large parcel of undeveloped land near Dulles Airport, the Harborside subdivision in Ocean City, Md., and the Hammock Point subdivision in Crisfield, Md. He also has an option to buy more than 1,500 acres in Howard County and has been negotiating to buy several hundred acres of land in Ocean Pines near Ocean City.
In Prince George's County, Vogel has been a contributor to County Council campaigns and to County Executive Parris N. Glendening. He also has strong ties to former Democratic Party chairman Peter O'Malley, a business adviser whose law firm handles Vogel's zoning applications before the County Council.
But many of Vogel's business ventures have run into problems recently. A major Prince George's County project, the Villages of Belmont near Upper Marlboro, is scheduled to be auctioned in a foreclosure sale next week after Vogel defaulted on a $4.3 million loan.
This year, Vogel negotiated the rights to buy the Atlantic City Race Track, for which he agreed to pay $17 million. Horseracing experts were astounded at the high price for the money-losing track, which has suffered financially since the opening of the city's casinos. Vogel, however, has not yet closed on the property.
Business associates say he recently flew to Europe to negotiate a loan from Saudi Arabian investors.
State officials, meanwhile, said there was rising concern that the failure of Vogel's real estate holdings could damage the future of harness racing in Maryland.
Vogel's attorney, Sandler, met yesterday with state Racing Commission officials to discuss the financial health of Vogel's tracks.
According to an audit of the tracks filed with the Racing Commission this spring, the two facilities posted a combined loss of more than $1.1 million for the year ended Sept. 30, 1989, and had accumulated more than $11 million in long-term debt.
Staff writers Howard Schneider, Fern Shen and Vinnie Perrone contributed to this report.