SFPD investigation revealed two convenience stores operated illegal gambling dens, fueled drug activity, and bought and sold stolen goods
SAN FRANCISCO (October 31, 2024) — City Attorney David Chiu announced today that he filed a pair of lawsuits against the owners and managers of two Tenderloin convenience stores for operating illegal gambling dens and enabling other illegal activity in the neighborhood. The first lawsuit was filed against the property owners and managers of SF Discount Market, and a second lawsuit was filed against the property owners and managers of Tenderloin Market and Deli. Both businesses housed substantial illegal gambling operations and facilitated criminal and drug activity in the neighborhood, and in doing so, the property owners and business managers and violated a number of state and local laws and California’s Unfair Competition Law.
“For law abiding residents, there is nothing convenient about these stores,” said City Attorney Chiu. “They have been a blight on the neighborhood for too long and are fronts for gambling dens and fencing operations. These two stores are endangering the safety, health, and welfare of their Tenderloin neighbors. We are asking the Court to spare the community from further harm and hold the owners accountable.”
“Our coordinated efforts to disrupt drug markets and improve conditions in the Tenderloin require us to tackle this problem with enforcement and services from all angles,” said Mayor London N. Breed. “I’m grateful for the hard work of SFPD to make these cases, and to City Attorney David Chiu and his team for following up with legal action. By rooting this illegal behavior out of the Tenderloin, we are making the entire neighborhood safer for residents, small businesses, and workers.
“San Francisco will not tolerate this kind of illegal activity in the Tenderloin or any other neighborhood in the city,” said Police Chief Bill Scott. “I want to thank City Attorney David Chiu for his partnership in our city’s collaborative effort to improve street conditions and public safety in the Tenderloin.”
SF Discount Market
SF Discount Market is a convenience store located at 238 Leavenworth Street and has been operating since at least 2023. SF Discount Market looks like a typical convenience store from the outside but has housed substantial gambling and fencing operations inside.
In May 2024, an undercover San Francisco Police Department (SFPD) officer went to SF Discount Market with two Gucci brand perfume boxes that the officer represented were stolen. Despite this, the clerk purchased the boxes. In April 2024, the owner who also owns a hookah lounge, called SFPD because someone attempted to sell him his own hookah pipes engraved with his lounge’s business name.
In September 2024, SFPD obtained and executed a search warrant at SF Discount Market and found significant evidence of criminal activity. SFPD seized nine gambling slot machines, a high capacity magazine for a Glock handgun, additional ammunition, 83 grams of cannabis, small plastic bags commonly used to sell cannabis, a digital scale, and $10,054 in cash. Officers also seized contraband and stolen property displayed for sale, including cartons of cigarettes from other states, 17 iPhones, and merchandise with original price stickers from stores like Walgreens and Sephora. SF Discount Market also sold drug paraphernalia, including straight glass pipes commonly used to smoke methamphetamine and crack cocaine, and sheets of aluminum foil commonly used to smoke fentanyl.
Tenderloin Market and Deli
The Tenderloin Market and Deli is a convenience store located at 200 Leavenworth Street and has been operating since at least 2013.
In April 2024, a SFPD officer entered the Tenderloin Market and Deli and saw patrons playing slot machines while an employee watched. A few months later in July 2024, SFPD pursued a fugitive into the store and again saw patrons playing slot machines.
In September 2024, SFPD obtained and executed a search warrant at the Tenderloin Market and Deli, finding significant evidence of criminal activity and seizing seven slot machines, a loaded firearm with a loaded magazine, $6,153 in cash, and a money counting machine. The market also sold drug paraphernalia, including straight glass pipes and Brillo pads, commonly used to smoke methamphetamine and crack cocaine.
Businesses that sell items defined as drug paraphernalia must keep the items in a separate room and ensure that minors do not enter the room without a parent or legal guardian. The drug paraphernalia sold at both markets were in plain view to anyone who entered the stores.
In 1997, California passed the Gambling Control Act, which restricts legal gambling to licensed California Lottery retailers, card rooms, casinos operated by Native American tribes, and race tracks. State and local law make virtually all other forms of gambling expressly illegal, including the operation or possession of gambling slot machines.
Defendants have created a public nuisance and contributed to criminal activity in the Tenderloin. San Francisco’s lawsuits allege the Defendants violated multiple state and municipal codes, engaged in unlawful and unfair business practices, and profited from operating businesses or leasing properties used for gambling and other illegal activity. The lawsuit against SF Discount Market also alleges that the Defendants used the store as a fencing operation and illegally sold cannabis.
In addition to seeking penalties and injunctive relief to cure the violations at the properties, the City is asking the Court to shut down both businesses for one year.
The case against SF Discount Market is City and County of San Francisco and the People of the State of California v. Bittles Projects 238 Leavenworth, LLC, et al., San Francisco Superior Court. The case against Tenderloin Market and Deli is City and County of San Francisco and the People of the State of California v. Debra Loi My La, et al., San Francisco Superior Court.
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