Not for Human Consumption

A Traverse City businessman’s years-long crime spree ends with a year in jail.

By Patrick Sullivan | Oct. 7, 2017

In June 2014, Natalie, a former clerk at the Traverse City adult entertainment store Fantasies Unlimited, testified before a grand jury in Grand Rapids about the day she quit her job.

Natalie said she got a telephone call from someone who screamed at her repeatedly, “What did you sell us?” She said she didn’t understand. The woman identified the product she was calling about. Natalie responded as she’d been trained to respond: “That’s not for human consumption.”

“The woman screamed again,” wrote Christopher Forsyth, an assistant Grand Traverse County prosecutor, in a motion to get Natalie’s testimony admitted in the criminal case against 46-year-old Brad Jason Vannatter, Fantasies’ owner. “She then stated her brother hung himself after he took the substance. The woman ended the call.” 

INADMISSABLE TESTIMONY
The testimony was deemed inadmissible hearsay, and Forsyth’s motion was denied; investigators were not able to track down the out-of-state caller.

Meanwhile, Vannatter cooperated and took a plea deal. Originally facing a dozen felony charges that ranged from drug dealing to pandering prostitution to money laundering, Vannatter pled guilty to one count of conducting a criminal enterprise.

“The defendant was cooperative, he did provide us with some information, he did work with us and the Department of Homeland Security and gave us a statement,” Forsyth said at Vannatter’s sentencing.

On Sept, 26, Judge Michael Haley sentenced Vannatter to one year on jail, or the maximum sentence recommended by state guidelines, based on Vannatter’s clean criminal history.

Vannatter and his attorney, Michael Naughton, asked for house arrest, which would have also been allowed under the guidelines, but Haley said the crime deserved punishment.

“The elephant in this room is the seriousness of this offense,” Haley said. “It’s a felony that carries up to 20 years in prison, and that cannot be understated.”

Naughton described his client as a businessman who walked too close to the edge.

“Without question, he walked too close to the line,” Naughton said. “In 2012 and 2013, he crossed the line, there’s no question about it. The law as it was in Michigan was something that he broke, and he has come to grips with that.” 

A VERY LARGE INVESTIGATION
The investigation spanned years and involved at least 24 detectives and other police officers, according to the charges. The case was led by the Homeland Security Investigations resident agent in Sault Ste. Marie and the Traverse Narcotics Team.

Detectives determined that Vannatter created a Traverse City-based online distribution center for synthetic drugs imported from China. The drugs mimic the effects of methamphetamine, ecstasy, or cocaine.

They raided Vannatter’s businesses and used records to create a timeline of hundreds of drug transactions that took place between 2011 and 2013 as synthetic drugs were shipped to northern Michigan by the kilo in exchange for thousands of dollars wired to China. Those drugs were then packaged and shipped to retail customers across the country.

As investigators zeroed in on Vannatter, they determined that one of his businesses, Garage T.C., was actually a money-laundering front. Prosecutors estimated he had laundered a half-million dollars through the phony business, disguising drug sales as auto-detailing services on invoices.

While Vannatter used his businesses in Garfield Township to distribute the synthetic drugs online, U.S. drug laws caught up with him — in October 2011, the synthetics Vannatter bought wholesale from China were deemed controlled substances by the DEA; months later, they were among 26 synthetics made illegal by the Synthetic Drug Abuse Protection Act.

RAZOR’S EDGE OF THE LAW
Forsyth, at the sentencing hearing, said Vannatter was not an unwitting business man who had inadvertently crossed the line.

“What matters is he knew he was selling these drugs,” he said.

Forsyth recounted the time agents raided his warehouse on Sybrandt Road, which is now an Alcoholics Anonymous meeting center. Investigators asked Vannatter if he was familiar with some of the specific substances that investigators by then knew he was selling.

“This is the kicker: He lies there. He says, ‘No, I’m not familiar with that. I don’t know what you’re talking about,’ when clearly he did,” Forsyth said.

Indeed, deception and dishonesty were central to Vannatter’s business model, according to records.

Another former Fantasies employee, Brittany, who worked at the store from 2011 through 2013, told police she was instructed to use euphemisms.

Brittany, whom, like others mixed up with Vannatter, the Northern Express will not identify because she was not charged with a crime, said she was trained to call pipes “spoons” and bongs “bubblers.”

There were other items in the store which arrived in packages shipped from China and labeled “not for human consumption.”

Brittany told investigators that she was instructed to handle the sale of those items even more delicately. Something labeled “Incredible Hulk,” for example, was supposed to be called “laundry detergent.”

VISIT FROM AN UNDERCOVER COP
Brittany was 21 when she testified before a grand jury in Grand Rapids about Vannatter’s operation. She was 18 when she was hired to work at Fantasies; before that, she’d been a waitress at Hooter’s.

Following police raids of other stores Vannatter owned near the end of 2011, Brittany said that Vannatter emailed her and told her to pull all of the “Incredible Hulk” from the shelves.

After that, Brittany told police, Vannatter’s business model changed. He still operated his Fantasies store on Cass Road, but he also launched “Fantasies World Wide,” a website that would from then on handle the sale of those other items that were “not for human consumption.”

Brittany was told that she was to refer all customers who inquired about those products to the website, fantasiesworldwide.com.

The drug dealing apparently ramped up around that time. Between February and December 2012, the business shipped to 4,320 customers from the Traverse City warehouse, according to a police report.

Brittany said she received packages with Chinese lettering at the Cass Road store and that she was told not to open them. A pair of brothers who worked for Vannatter collected them and took them to the warehouse across the road.

That’s where Vannatter opened Garage T.C., an auto detailing place that never detailed any autos.

Brittany testified that she was visited by an undercover officer in June 2012.

Her account is backed up by an affidavit filed in the U.S. District Court for the Western District of New York in a related case. That affidavit describes a visit to Fantasies in Traverse City on June 11, 2012, by an undercover Homeland Security officer who visited a clerk named “Britney” and asked about “bath salts,” another name for one of the kinds of synthetic drugs.

“Britney said the high from ‘bath salts’ is at a different level (more potent or worse) and is not like smoking incense (i.e. spice),” according to the affidavit. She gave him a business card and referred him to the website.

At the grand jury hearing two years later, Brittany said she was cautious in dealing with that customer because Vannatter had warned her that she might be visited by undercover police.

“I thought he was an undercover cop,” she testified. 

“BETTER TRAINED GIRLFRIEND”
Vannatter’s former wife and girlfriend, Taylor, provided investigators more details about Vannatter’s business. She also described some disturbing behavior.

Taylor told police she had wired money through Western Union to China and helped design business cards and the website for Fantasies World Wide, but that she didn’t know Vannatter was a drug dealer.

Taylor, who is 26 today, said in a meeting with her attorney and a detective last year that at first she thought he was selling “male enhancement pills.” But she said she gradually recognized that his business was suspicious.

“Other employees started leaving the business, including another female named Brandi and one named Natalie. When people started leaving, (Taylor) started to put it together that something was going on,” according to a police report. “(Taylor) never confronted Vannatter about her suspicions because she was afraid he would lock her up in the basement.”

She also told police that while she lived with Vannatter at his home on the Old Mission Peninsula, he gave her written instructions every day demanding specific behaviors and tasks.

Once, according to court documents, Vannatter wrote, “When you are doing laundry, cleaning dishes, etc., you are to be naked except for your new collar … this is a reminder that I am in full control of you, and you need constant training.”

Another time, he wrote to her that he would allow her to have lunch with her mother that day, but he warned her that he would not be so lenient in the future: “After that, you are no longer allowed to make a decision. I have a very well-trained dog, and I expect a better trained girlfriend in every respect.”

Copies of the letters — allegedly in Vannatter’s handwriting — are included in his court file.

The charges against Vannatter also alleged that he forced Taylor into prostitution and advertised her services on backpage.com, a site for classified advertising, beginning in December 2011 for 18 months.

A GRAY AREA OF THE LAW
The prostitution allegations were dismissed in the plea deal, and they were not raised during Vannatter’s sentencing hearing.

Vannatter’s lawyer, Naughton, did not return a message seeking comment. Taylor and Vannatter later married and, by the time she made the allegations to police, the couple had gone through an acrimonious divorce.

At his sentencing hearing, Vannatter described himself as a family man. He expressed regret about the drug dealing, but not directly enough to satisfy the judge.

“I hope the court can consider myself as a person, my being a 46-year-old man, single father, raising two teenage daughters. I’m their sole provider,” he said. “I also would like the court to really be aware that I am sorry for what had happened.”

“You’re sorry for ‘what had happened?’ What does that mean, exactly?” Haley asked.

Vannatter replied: “At the time I did not know that the substance was illegal —”

“You’re still going with that? You actually did not know what you were doing was wrong? You’re going with that?”

“No, no, I, I — not that I didn’t know it was wrong, I’ve always …”

“Well, that’s what you stated in your emailed written statement,” Haley said. “ … Simply, ‘I did not know I was committing a crime nor was it my intention.’”

“Yes. I understand your honor. At the time, with the substances at the online business that we had, we took great steps to make sure that we were on the correct side of the law. We never set out to break the law or mislead by any stretch. It was, it was obviously a gray area of the law, and I met with an attorney on a regular basis to make sure that we were on the up and up. I never want to jeopardize my livelihood and years of what I’ve worked for and, most importantly, my children.”

In addition to the year in jail, of which Vannatter served 34 before he posted bond, Haley sentenced him to serve five years of probation. 

A LONG HISTORY IN TC
Even before he faced sensational criminal charges, Vannatter was featured in northern Michigan media more often than the average businessman.

In 2009, he and an earlier wife were profiled in the Northern Express after they had made a deal to purchase the entertainment center Streeters. Vannatter announced that he wanted to transform the venue into a new kind of nightclub with “new atmosphere.”

By then, his chain of adult entertainment stores had spread across Michigan, and he’d opened the Traverse City Fantasies location, but he said he wouldn’t turn Streeters into an adult club.

Whatever his plans, they didn’t last long. The purchase agreement dissolved in a lawsuit in 2010, and the property was returned to its original owners.

Vannatter next had run-ins with officials in Traverse City and Garfield Township over operation of the Tabu Lounge, a members-only “showgirls” nightclub. It operated in early 2011 in a building behind Union Street Station and was the subject of complaints and zoning violations.

Vannatter claimed the Logan’s Landing lounge was actually a “private film studio” for his fiancé and adult film actress (whom he would later be accused of forcing into prostitution.)

It operated for two months next to a children’s music store.

Once Garfield Township officials launched an investigation, Vannatter agreed to shutter the business.

Just after the Homeland Security raids in December 2012, Vannatter opened the Laughing Buddha in early 2013 on East Front Street. It is a smoke shop that would also sell adult novelty items, but it also raised concern among neighbors and city officials because of Vannatter’s track record. He vowed to keep the stock of adult items to less than 35 percent of the total inventory in order to avoid more rigid regulation as an adult-oriented business.

On a recent afternoon, the back of the store was stocked with hundreds of colorful sex toys while the front was filled with pipes, bongs, and incense. A clerk had no comment when asked about Vannatter, who had been sent to jail that morning.