"IF THERE IS A RAT IN THE PILE, I WANT TO KILL IT," explains Seattle Liquor Agent Steve Hypse, as his partner, Ui Kim, speaks in Korean with the mom-and-pop owners of a small market on Madison. "Any organization is gonna have a rat sometime. When you find it, you kill it. And you tell people about it."

Hypse, Kim, and the rest of the 88 agents who enforce state liquor laws from Seattle to Spokane received some harsh news from above last week: allegations of wrongdoing have been made, and the Washington State Patrol has been called in to investigate the entire liquor enforcement division. No specifics were offered. "It was like, slammo!" says Hypse. "Right between the eyes. People jumped." The agents have no idea which of them are being investigated, or for what. "We're not in control of the investigation, and we don't know how it will end," says Hypse. "We just know that it will go all the way."

Allegations of unethical behavior by agents who enforce the state's liquor laws are nothing new. For years people in the bar and restaurant business have accused liquor agents of everything from petty retaliation to hard-assed shake-downs. There was even a prominent case a couple of years ago where an agent was accused of taking a bribe--he was fired, but it took 10 months. That case involved only one agent; the current investigation covers the entire agency.

Leading the charge behind the allegations is State Representative Christopher Hurst, a Democrat from Black Diamond who has been a police officer for 20 years. He notes that the dual nature of liquor agents--who are in charge of both enforcing liquor laws and recommending which licensees should be shut down--produces "a situation where an individual serves not only as law enforcement officer, but as judge and jury as well. This creates a tremendous opportunity for corruption. And it only takes a couple of people to make the whole system appear to be corrupt."

He's predicting a hot summer for the Liquor Board and calling for a complete overhaul of the enforcement division. But he turns cagey when asked for further details--he's short on proof of his allegations, stating that the details will come out in the investigation.

Agents like Hypse wonder whether the State Patrol will find anything at all. "If we're doing something wrong, we need to know what it is," he says. "If there are people who are doing something wrong, let's get rid of them. But if there's nothing there, then it's just rumor-mongering. I hate rumor mongers. They ruin the reputations of more good people."

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There is no shortage of club and restaurant owners in Seattle who charge, off the record, that liquor agents have too much power. Many complain of personal vendettas and retaliation, and of being bombarded with arcane laws--often enforced selectively--designed to nitpick a business to death. A main point of contention, being challenged in the courts, is the Liquor Board's control over which clubs are allowed to host music shows and dance nights and which are not.

Others complain of favoritism. Brenda Peters, a liquor agent working Pioneer Square, was reprimanded last year for doing a $2,000 upholstery job for Tina Bueche, the owner of the club Dutch Ned's and a feisty neighborhood activist. The arrangement--viewed as a cozy way to cement a working relationship, if not an outright bribe--struck an especially sour note with local Koreans since Bueche had actively tried to shut down the Korean-owned Saveway Grocery the year before. Furthermore, not long after Peters did the upholstery work, she began pushing for the closing of the Milky Way, a Korean-owned club just a few blocks from Bueche's place.

The Liquor Board finally closed the Milky Way last year after evidence turned up that employees had been shooting guns in the club's basement.

Some of the most serious allegations against liquor agents come from Sunny Chae, a businesswoman who tried unsuccessfully to get a liquor license for a restaurant in Northgate a few years ago. Chae charges that many Korean licensees are treated unfairly by liquor agents, but stay silent about abuses in order to protect themselves. "The more I spoke up loud, the more I was getting into trouble," she says, alleging that liquor agents hit up Korean establishments for "free drinks and free women," and that "Korean people are scared shitless" of them.

While these accusations about harassment of the Korean community are outrageous, Chae came up short when pressed to support her claims. The world of liquor law enforcement is drawn with fuzzy lines: this agent is said to date that club owner, that agent is said to have it in for that restaurateur, and businesspeople have their own motives for attacking agents. Chae says she was denied a license because she was caught in the middle of an ongoing feud between two camps of agents vying to bring each other down. The board says it rejected Chae's application because she had misrepresented facts to investigators and failed to produce necessary documents.

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If corruption exists within the department, State Rep. Christopher Hurst is determined to find it. At first glance, he seems the perfect soldier for the task: a longtime cop who knows how difficult it is to ferret out and eliminate corruption, and an energetic rookie legislator looking to shake up a bureaucracy that could use a good rattling.

But Hurst has conflicts of his own. The case he's using as a rallying point--involving former agent James McDonald, who was accused of taking a bribe in 1997--involves a couple of Hurst's former co-workers, two Federal Way cops.

On December 12, 1996, McDonald was parked in his state car outside the Cafe Arizona, a Federal Way hiphop club he was in charge of patrolling for liquor violations, when two narcotics officers approached him from behind, apparently mistaking him for a drug dealer. McDonald claimed that one of the officers wore a paramilitary-style black ski mask, had his gun drawn, and didn't identify himself as a police officer.

McDonald was arrested, but no charges were filed. In turn, he sued the two cops--Hurst's colleagues--for $4.5 million, for false arrest and harassment. Then one month before his case went to court, McDonald was pulled over twice in the same night (by different officers from the same department) for drunk driving. He was arrested the second time and hauled off to jail.

McDonald didn't fare well in court. Not only was his suit shot down, he ended up losing a countersuit and having to pay the two narcs $5,000 each for defamation of character. He was later fired from his job for driving a state car on personal time.

A few months ago, just when the PR folks at the Liquor Board thought they had finally gotten past the McDonald nightmare, Hurst began dredging it up again. Hurst is dissatisfied with how the agency handled what he considers a very serious charge: the allegation that McDonald accepted $5,000 from the owners of the cafe he was in charge of regulating.

It's clear that accepting the money--which went toward building his case against the cops--was unethical. But it's important to note that the money went to pay McDonald's lawyer, who was also representing the club, Cafe Arizona. The club was looking to sue the Federal Way Police Department for harassing its African American customers. It wasn't a direct payoff, but it was close enough to set off some alarms. The State Patrol investigated but made no determination about the alleged payoff. McDonald was fired anyway, but Hurst laments that it took so long. It's inaction like that, he says, that justifies a closer look.

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As Hypse and Kim make their rounds from club to bar to cafe, they are pictures of cordial good will. Business owners greet the two agents warmly, shaking hands and joking with them. Hypse, who served in Vietnam and worked at one point as a cop, says he'd never accept so much as a free cup of coffee from a licensee. He clearly takes the vague nature of the investigation personally, saying, "My honor is the most important thing to me."

Of course, no one is charging that all liquor agents are corrupt; the point of the investigation is to track down any who are, and weed them out. Hurst says it's important that the job be done by an outside agency, by someone other than the politically appointed Liquor Board [see "Liquor Lords," page 26]. "Through no fault of their own," says Hurst, "they have inherited a system that has inherent flaws and corruption. Quite honestly, they don't have the background or the skills or the ability to understand the problem and fix it."

When reached for comment, each board member claimed to welcome the investigation. Board member Jesse Farias, a longtime state employee, vows that if anything turns up, he'll make a point of doing something about it. "I've been in big government a long time," he says, "and my record shows that if there are people out there who are not representing the agency in a professional manner, then we need to deal with them. I don't care how long they've been here."

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