'Java Juggs' coffee carts were allegedly fronts for prostituting baristas

Late last week, prosecutors in Snohomish County, Washington, charged Carmela Panico with promoting prostitution and laundering the proceeds. What's unusual is the venue for the alleged sale of sex acts: Drive-thru coffee carts. Panico, a 52-year-old former nude dancer, owned and operated a fleet of Java Juggs coffee stands north of Seattle, featuring bikini-clad baristas.

Baristas told investigators that they earned $15,000 and $30,000 a month, mostly from tips. Panico hauled in more than $2 million in three years, and kept much of that cash hidden from the IRS, prosecutors say. Police found $250,000 in cash in Panico's house. Deputy prosecutor Bob Hendrix alleged in the charging documents that Panico would take a fixed cut from each of her seven stands, letting the baristas keep the rest: "The sales goals were effectively rent that the girls paid to have the opportunity to perform lewd conduct or acts of prostitution."

The Everett Herald's Diana Hefley explains the basic business model:

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A sheriff's sergeant, Darrell O'Neill, is also accused of tipping off Panico and her workers to the police investigation, in return for sexual favors. He resigned following his arrest, after 30 years on the force, but pleaded not guilty to the charges. Seattle's KOMO News has more on the story below. --Peter Weber