Devil in the Desert: A Neon Sign For Crime

Speaker 1 This is Deborah Roberts here with another weekly episode of our latest series from 2020 and ABC Audio, Devil in the Desert.

Speaker 1 Remember, you can get new episodes early if you follow Devil in the Desert on Apple Podcasts, Spotify, or your favorite podcast app. Now, here's the episode.

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Speaker 4 On October 1st, 2012, hours before Michael was kidnapped, one of his neighbors noticed something was off.

Speaker 4 The neighbor's house was located behind the house where Mary Barnes and Michael lived. Around 2.30 that afternoon, she looked out her second floor window.

Speaker 4 She told police what she saw. A white truck with a big dent on its side.
It was in the rear alley of Michael's house, and she saw three men near the truck. One of them was wearing a hard hat.

Speaker 4 Maybe they were construction workers. And she told police that she saw a ladder placed on the side of Michael's house.

Speaker 6 So then they were standing there, and you said something about they were moving the ladder up and down.

Speaker 7 Yeah, it was like

Speaker 7 there was a lot of noise. And I'm going, what in the heck?

Speaker 7 You asked me before if I saw anybody go up the ladder. I saw no one go up the ladder.
I was peeking back and forth, but I don't remember now.

Speaker 6 Okay, so was the sound, did it almost sound like somebody, you know, was raising and lowering the ladder?

Speaker 8 Yeah, okay.

Speaker 4 The neighbor told police what what she remembered about their appearance. One man, she only saw his arms as he held the ladder in place.

Speaker 4 The second man had dark hair and was wearing jeans and a red or orange shirt. And then there was the third man.

Speaker 6 You said the guy with the hard hat, male Hispanic, medium height, medium weight. You just said he was good looking.

Speaker 8 I said that because, God, that's just going to haunt me. No, I said it.

Speaker 9 Look,

Speaker 7 I'm not going to tell your husband, okay?

Speaker 10 No, I'm just saying.

Speaker 7 I said that because it wasn't like he was ugly.

Speaker 6 Yeah, there was nothing that stood out about him.

Speaker 8 Right. Okay.
Right.

Speaker 7 It was just, you know, it was not like he was like, you know, a big hoodlum. Right.

Speaker 4 At one point, the ladder was placed in the back of the truck, and one of the men got into the driver's seat and drove off.

Speaker 8 And that's when I last saw him.

Speaker 6 And the other two guys, you didn't see where they went?

Speaker 4 She didn't. Which was strange.
Where had they gone? And what was also strange, the neighbor said she didn't see any work being done on the house.

Speaker 4 Sure, there was the truck, the hard hat, and the ladder, but these all seemed like props. It was like the men were doing choreography of construction workers.

Speaker 4 Not the real thing, but a performance of the real thing.

Speaker 4 But then she offered something else. Turns out the neighbor had even more to tell them.

Speaker 6 Okay, and then that's when you got the license plate off the truck?

Speaker 3 Yeah. Okay, perfect.

Speaker 6 And that was a piece of paper that you handed to me when I was out there that day.

Speaker 5 All right. All right, excellent.

Speaker 4 A license plate number:

Speaker 4 the first hard lead.

Speaker 4 I'm ABC News Chief National Correspondent, Matt Gutman. In this episode, investigators take the neighbor at her word and the investigation kicks off.

Speaker 4 From ABC News, this is Devil in the Desert, Episode 2, a neon sign for crime.

Speaker 4 Investigators weren't sure if the neighbor had tipped them off to something big, but at least the license plate offered them somewhere to start.

Speaker 4 The next step was to take the information she provided and see where it led them.

Speaker 4 So that's exactly what lead detective Ryan Peters did. Detective Peters was one of the first officers to visit Michael's house after he was found in the Mojave Desert.

Speaker 11 Let me at least run the license plate and figure out who this guy is or girl is and how it's associated. Maybe it comes back to a business, maybe it comes back to an individual.

Speaker 11 So I finally run this plate and look into it and it comes back to a local individual, Kyle Hanley.

Speaker 4 Kyle Hanley was apparently the owner of that white 1998 Dodge pickup truck. Investigators did some digging and learned that Kyle was from Fresno, California.

Speaker 4 He was in his early 30s and had been renting a house in Fountain Valley near Newport Beach. And investigators also discovered he was connected to the weed industry.

Speaker 4 Deputy District Attorney Matt Murphy was supporting Detective Ryan Peters' early investigation.

Speaker 12 We got a guy in the marijuana business in Fountain Valley whose truck this is who, as far as we could tell, had no business being down there.

Speaker 4 They would later learn that Kyle Hanley did have business being down in Newport Beach, business with Michael.

Speaker 4 And when they asked him, Michael told investigators he had met Kyle Hanley just nine months earlier.

Speaker 12 All of a sudden, we have a huge break because Michael knew Kyle Hanley. In fact, he describes how he bought some marijuana product from him.

Speaker 4 Investigators started to unpack the precise nature of the relationship between the two men. It seemed simple.
Kyle grew weed and Michael sold it.

Speaker 4 But investigators would later find out that their relationship was more complicated than that.

Speaker 4 At the very beginning of this investigation, all the team knew about Michael was that he owned or operated three different weed dispensaries in the Newport Beach area.

Speaker 4 In fact, he was one of the most successful dispensary owners in Newport Beach.

Speaker 4 Michael's medical dispensaries were just a handful of the nearly 1,000 that had popped up in the state of California by 2009, which brought in hundreds of millions of dollars a year in revenue.

Speaker 4 A lot of people like Michael were rushing to get into the business. You could call it the green gold rush, or maybe even the wild west of a new industry.

Speaker 4 In 1996, California became the first state to pass a law, it was called Proposition 215, that legalized medical marijuana.

Speaker 4 The state law said that in order to buy the drug, you needed an ID card to prove that a doctor had recommended it as part of medical care.

Speaker 4 The law didn't set up a new state agency or anything like that to regulate the businesses that would crop up.

Speaker 4 So, with few restrictions in place, medical dispensaries like Michael's started popping up all over California.

Speaker 4 But the possession and use of marijuana, medical or recreational, was still illegal on the federal level. And that caused problems for dispensary owners, especially when it came to money.

Speaker 4 Marijuana business owners couldn't put their earnings into banks, and they also couldn't transfer money through wires.

Speaker 4 Since there was a lot of cash sloshing in and out of these dispensaries, the business owners themselves were huge targets.

Speaker 4 Law enforcement would later refer to these dispensaries as a neon sign for crime.

Speaker 11 It was a cash business.

Speaker 4 Detective Peters again.

Speaker 11 At the time, we were having a lot of dispensary invasions like 211s, robberies involving weed dispensaries, weed growers, because right around that time, it became legal medicinally.

Speaker 11 So like a lot of people were getting into the business. But at the same time, once they got into the business, all the criminals were trying to take their cash.

Speaker 4 A few years prior, in December 2007, a violent break-in had occurred in Huntington Beach, California, triggered over a conflict between individuals buying and selling weed.

Speaker 4 Detective Peters and the team knew that this industry was causing problems.

Speaker 4 Prosecutors realized time and again that if you had a lot of cash at your disposal, someone else definitely wanted what you had.

Speaker 4 And when it came to Michael on that fateful morning in October 2012, someone else did want what he had.

Speaker 4 Detective Ryan Peters asked Michael about this. Did he know why someone was after him? Well, Michael told him, maybe the people who attacked him wanted some of his newfound wealth.

Speaker 4 But he stressed that he wasn't flush with money at all, not by any stretch.

Speaker 4 Remember, when Mary Barnes spoke to police, she said the kidnappers kept demanding that Michael tell them where he kept a million dollars.

Speaker 4 But Michael told the men and later investigators he didn't have it.

Speaker 11 The only weird thing and the thing that kept throwing us off was like how much money they were asking for and why and how they knew that he possibly could have had that.

Speaker 4 Let's break that down, starting with how they knew. For a person to want to go after what Michael supposedly had, they had to have been up close and personal with him.

Speaker 4 Maybe it was someone who was watching the ins and outs of his business, seeing cash change hands. Then there's the issue of how much.

Speaker 4 There were some clues from the crime scene that were pretty telling. The men didn't steal anything from inside Michael's house.

Speaker 4 They didn't even agree to let him go when he offered to take out $100,000 in cash, even after hours of torturing him. They believed there was more.

Speaker 4 And then there was the why.

Speaker 4 Why, after Michael refused to hand over the supposed million dollars, did the attack continue so brutally?

Speaker 4 Detectives wanted to understand the motives of the kidnappers, but Michael couldn't tell them anything that could explain how personal the attack had seemed.

Speaker 4 That was until Detective Peters asked him if he knew Kyle Handley.

Speaker 4 Michael told the investigators that in January of 2012, Kyle Handley walked into that collective that Michael owned and asked him if he could become a vendor, which would allow Kyle to sell Michael his marijuana.

Speaker 11 Kyle was selling marijuana to Michael, and Michael was buying small amounts. Nothing crazy, just $2,000 worth, $5,000, $6,000 dollars worth of marijuana

Speaker 4 and as the grow business grew so did their friendship they started hanging out outside of work

Speaker 11 in may of 2012 a few months after they met michael invited kyle to las vegas for a buddy's birthday party he thought that kyle would get along with his group of friends detective peters again They would go out to dinner, they would go to clubs, they would go to strip clubs, they would gamble all day, to the point where Michael is spending thirty, forty thousand dollars on this trip, and Kyle's not paying for anything.

Speaker 4 There was a suite that was about twelve thousand dollars a night. Michael remembered gambling away about five thousand dollars in a single session.

Speaker 4 Kyle would have seen all this cash flowing and being passed around over gambling tables and drinks. After the trip, however, things cooled down.
Michael noticed that Kyle grew distant.

Speaker 4 He still came to sell weed to Michael for a while, but then stopped showing up.

Speaker 11 Wasn't answering his phone calls anymore, wasn't responsive, wasn't selling weed to him anymore. He was just gone.

Speaker 4 Michael told investigators he reckoned it could be one of three things. First, Kyle may have lost his supply.
Second, maybe he moved back home to Fresno, California.

Speaker 4 Or third, that he was arrested for cultivating marijuana.

Speaker 4 But Michael didn't think much of it. So it goes in the weed business.
People come and people go.

Speaker 4 They lost touch, and when Michael tried to call Kyle that summer, he received a message. Kyle's number was no longer in service.
He was nowhere to be found.

Speaker 4 Kyle might have disappeared from Michael's life, but all police needed was a license plate given given to them by Michael's neighbor to find exactly where he was now.

Speaker 4 On October 5th, Detective Peters dispatched officers to stake out Kyle's address in Fountain Valley and waited to have a search warrant signed by a judge that would allow him to access Kyle's vehicle and his home.

Speaker 4 And by the early hours of the next morning, Peters had his search warrant. That meant that police could finally make their move.

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Speaker 4 He's fallen asleep, so she quietly and ever so carefully finds his phone and calls for help.

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Speaker 4 This 911 call began an investigation that would turn the town of Ashland into a crime scene.

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Speaker 4 On October 6th, 2012, Kyle Hadley left his home in Fountain Valley in a dark-colored Lexus.

Speaker 4 He went to a 7-Eleven a few minutes away. It was a nearby Huntington beach on one corner of an intersection.

Speaker 4 It was 2.30 in the morning, so the streets were quiet, but everything was lit by bright neon signs. Kyle pulled into the parking lot and went into the store.

Speaker 4 When he emerged just a few moments later, he got into his car and tried to leave, but a large truck had pulled in right behind him, blocking him in.

Speaker 4 A man got out and approached his window. According to the police report, this man wasn't wearing a uniform and he had a gun.
He also had his police badge visible.

Speaker 4 He asked Kyle his name and told him to step out of the vehicle. That's when Kyle learned that the police had been waiting outside his house and followed him there.

Speaker 4 Now they told him, we have a warrant to search everything.

Speaker 4 Then Detective Peters arrived on the scene. The moment was captured by the officer's body camera.

Speaker 18 Detective Ryan Peters, how are you?

Speaker 18 What's wrong?

Speaker 11 What's wrong?

Speaker 5 Oh,

Speaker 18 Nothing's just...

Speaker 18 I've a search one for your person, your car, nothing else.

Speaker 4 Kyle insisted that he wouldn't talk.

Speaker 18 You know, I just, I don't know what this is about, and it's, you know, I would just rather not answer any questions without my attorney. I just, you know.

Speaker 4 Kyle seemed nervous. He called the detective, sir, are you going to be sick?

Speaker 18 I think I'm okay right now, sir. Okay.

Speaker 4 Peters asked if Kyle would wait with him while the police searched the car he had driven to the 7-Eleven.

Speaker 4 Kyle said, I'm at your mercy, sir.

Speaker 4 Kyle was arrested and taken into police custody. Now, Detective Peters could move on to the next step of his plan, the search warrant.

Speaker 4 He wanted to inspect the house Kyle was renting in Fountain Valley and the white truck in the driveway. It was a big house on a corner lot in a quiet residential street.

Speaker 4 It had a one-car garage and small backyard.

Speaker 4 Here's Matt Murphy again.

Speaker 12 First thing they find is they find the truck exactly as it was described. So not only does the plate match, but it's got a big dent on the side.

Speaker 4 It was the same white dodge that Mary and Michael's neighbor had told police she saw right down to the dent.

Speaker 12 Then they open his truck. They're immediately almost knocked over by this overpowering smell of bleach.

Speaker 11 The everyday guy or girl does not bleach the back of their truck. He's covering up something.

Speaker 4 On the floor of the truck, they find a blue disposable glove. Then in the garage, they found a pair of gray athletic shoes with what appeared to be drops of blood on them.

Speaker 4 The next place to look was inside Kyle's house.

Speaker 11 And as we go inside the house, it was really clear that Kyle wasn't really living there like he was. Like that was his house he was living in, but he only furnished one room.

Speaker 11 and even furnishing it it was just like

Speaker 12 two suitcases worth of clothes and a bed there's no dressers there's no pictures and the entire attic was outfitted to grow marijuana obviously a grow house right so they find a bunch of receipts for hydroponic supplies it's for indoor marijuana grows they find electricity bills that are consistent with a bunch of electricity used to artificially grow marijuana they found a zip tie in the house too.

Speaker 4 Detective Peters noticed that it looked just like the one they found on Mary Barnes and Michael at the crime scene.

Speaker 11 It's another layer. Can I match those zip ties? No, I can't say those zip ties are the exact same zip ties, but they are identical and they're odd for his house.
So again, another little piece, right?

Speaker 4 Detective Peters kept moving through the house, scouring it for more evidence.

Speaker 11 I find an all-black shirt with bleach splatter on it. I'm like, all right, this kid's using bleach for unknown reasons other than bleaching the back of his truck.
And it's splatter, which is abnormal.

Speaker 4 Right before it's been abandoned in the desert, Michael had been doused in bleach.

Speaker 4 Detective Peters thought that the bleach spatters might match the pattern of someone pouring it at a height onto a body below.

Speaker 11 Dumping out a body, it's going to splatter. So again, I got this shirt.
I'm excited. I can link possible links, right, to this crime scene, which is great,

Speaker 11 but I still don't have that like, aha, moment. I still can't charge him with the kidnapping.

Speaker 4 The team made its way to the backyard. They found trash bags there, green and black.

Speaker 11 They're not old. They look fresh.
There's no spider webs on them or dirt or anything on them. So we slowly, methodically kind of start going through these things.

Speaker 11 And what we're finding is that they're white towels with bleach all over them. And so we're getting excited, but we also want to know what else is on it.

Speaker 11 So we test these towels for blood and they're coming back positive.

Speaker 11 So we finally come across this zip tie and it's a used zip tie.

Speaker 11 It's a cut used zip tie and it matches identical to the one that's in his house and it's also identical to the ones found on Michael and Mary at the crime scene.

Speaker 4 Ryan Peters and the team were now certain Kyle Hanley isn't just a guy from Fresno who happened to know Michael and bailed on him after a wild party in Las Vegas.

Speaker 11 He is 100% involved.

Speaker 4 Finally, a suspect.

Speaker 12 Absolutely. This is enough evidence to charge Kyle Hanley.

Speaker 4 Kyle was transported to the Newport Beach Police Department, where he was charged with aggravated mayhem.

Speaker 4 The charge was serious. It meant police thought that he could be responsible for disfiguring Michael's body.

Speaker 4 Newport Beach PD took his fingerprints and DNA samples Kyle gave his mom as his emergency contact.

Speaker 4 And far from cooperating, Kyle wasn't telling police anything they wanted to know about the attack on Michael. And that's a problem.

Speaker 4 because they know that if Kyle committed this crime, he didn't do it alone. After all, the neighbors saw three men outside of Michael's house that afternoon when she peeked outside her window.

Speaker 4 And both Mary Barnes and Michael said they heard three voices when they were kidnapped. Investigators weren't sure that Kyle could have been the mastermind behind all of this.

Speaker 4 Sure, he was connected to the marijuana industry, but he didn't have a violent record.

Speaker 11 Kyle Hanley was a key. He was the tool to the next guy.
He was the key to the future of this investigation. I knew early on he wasn't my main guy.
Like, he wasn't the guy. I just, you can sense it.

Speaker 11 You can feel it, you know. So, I needed to use Kyle Hanley somehow.
I needed to get to him. I needed to follow him.
I needed him to lead us to the next big break.

Speaker 4 Who were the other men?

Speaker 4 Investigators would need to hear it from Kyle, but he was lawyered up, unwilling to say anything that might help them.

Speaker 4 So, to tell them the story, they could only rely on the evidence they found at Kyle's house.

Speaker 4 Swabs from the found zip ties and glove were sent to a lab for DNA analysis. Months went by, and just after the new year, in January of 2013, the results came back.

Speaker 11 I get a DNA hit on the glove found on the floorboard of Kyle Hanley's truck.

Speaker 4 It's not Kyle Hanley's DNA. It's not Michael's, and it's not Mary Barnes.
Nope, it's someone else.

Speaker 4 A name that hadn't been brought up yet.

Speaker 11 And the DNA hit comes back to Hossein Nayeri.

Speaker 4 So investigators plug Hussein Nayeri into the statewide criminal history index.

Speaker 12 Hussein Nayeri was in the CODIS system. CODIS is the DNA master system where unknown crimes are loaded into that as well as every known convicted felon in the state of California.

Speaker 4 Detective Peters and his team learned that the two men, Hussein Nayeri and Kyle Handley, went to high school together just outside of Fresno.

Speaker 4 And as they pieced together information about Nayeri, they realized he was already on their radar as recently as just the month before the kidnapping of Mary Barnes and Michael.

Speaker 12 And it turns out that Hussein Nayeri was known to to them because Hussein Nayeri's name wound up on insurance documents found in a Chevy Tahoe at the end of a high-speed chase, which culminated on Balboa Island in Newport Beach.

Speaker 12 And essentially, as Ryan Peters and other detectives started connecting the dots, they realized that they still had the Tahoe.

Speaker 4 That Chevy Tahoe was still in their possession from that high-speed chase just weeks back. It was just sitting in a lot.

Speaker 4 For Detective Peters, this was really good news.

Speaker 4 He was lucky with the first car he inspected. The white dodge had led them right to Kyle Handley.

Speaker 4 Could this second vehicle, this Tahoe, lead them to Jose Nayeri?

Speaker 4 And if it did lead to him, what would they find?

Speaker 19 Hossein is a leader, not a follower.

Speaker 20 Your parents don't understand you. I understand you.
You know, all of these things he would start putting in your head.

Speaker 19 And I remember being told where money was hidden and me being like, oh, really? They're making it like that.

Speaker 4 Like, a lot of money.

Speaker 21 I just want you to know that your friends just walked out the door. I could kill you right now.

Speaker 21 And they let me do it.

Speaker 4 That's next time on Devil in the Desert.

Speaker 4 Devil in the Desert is a production of ABC Audio, ABC News Studios in 2020. Hosted by me, Matt Gutman, this series was produced by Madeline Wood, Amy Padula, and Kiara Powell.

Speaker 4 Our supervising producer is Susie Liu. Music and mixing by Evan Viola.

Speaker 4 Special thanks to Liz Alessi, Katie Dendas, Janice Johnston, Eamon McNiff, Jake Lefferman, Katie Muldowney, and Michelle Margulies. Josh Cohan is our director of podcast programming.

Speaker 4 Laura Mayer is our executive producer.

Speaker 2 It's one of Britain's most notorious crimes: the killing of a wealthy family at Whitehouse Farm. But I got a tip that the story of this famous case might be all wrong.

Speaker 11 I know there's going to be a twist, won't they? A massive twist.

Speaker 16 At every level of the criminal justice system, there's been a cover-up in this case.

Speaker 2 I'm Heidi Blake. Blood Relatives is a new series from In the Dark and The New Yorker.
Find it now in the In the Dark podcast feed.