Exclusive: U.S. Attorney details federal case that shut down crime-plagued west Phoenix motel

PHOENIX — Residents living near Interstate 17 and Bethany Home Road say their neighborhood feels different these days: quieter, cleaner and safer.

For years, they say, the Royal Inn in west Phoenix was a hub for prostitution and drug activity. Now, following a lengthy federal investigation, the motel’s owners have pleaded guilty, forfeited the property and agreed to pay hundreds of thousands of dollars to the federal government.

In an exclusive interview, U.S. Attorney for Arizona Tim Courchaine detailed how the yearslong investigation unfolded and what it means for the surrounding community.

On September 24, 2024, a coordinated raid by Phoenix police and the FBI brought what many neighbors describe as long-awaited relief.

“The roads are cleaner. We feel like we can start walking our dogs because I don’t think we could have before,” Leslie, one nearby resident, said.

According to federal court documents, the Royal Inn had become what prosecutors described as a breeding ground for criminal activity, including prostitution, drug dealing and drug trafficking.

Courchaine said investigators determined that ownership was not just aware of the activity but profiting from it.

“They made sure that they were known as a place where ownership would not report you to the PD, and you were safe to engage in your illegal activity because ownership had your back,” Courchaine said.

The indictment alleged that Varsha Patel and Nilam Patel, the husband-and-wife owners of the Royal Inn, rented rooms to individuals engaged in prostitution and directed them to solicit customers off the property. Prosecutors also alleged they rented rooms to people distributing drugs and alerted them when law enforcement was nearby.

Investigators found the motel often failed to require identification or credit cards to rent rooms, a standard practice in the hospitality industry.

Courchaine said additional red flags included short-term, cash-only rentals.

“Cash for rents that would last anywhere from months to hours,” he said. “Once you see hourly rental agreements at a hotel for two hours at $120 for those two hours in a place like the Royal Inn — it wasn’t exactly the nicest spot in Phoenix to stay — it already raised a red flag, especially for our investigators.”

Courchaine said operations like the Royal Inn can destabilize entire neighborhoods.

“You lose the ability for the normal citizens of that community to appeal to law enforcement,” he said. “You lose the ability to predict what the person on the street is going to do. Are they going to be on drugs? Is there going to be someone trying to protect their prostitution racket there when you try to intervene and make a safe place for your kids?”

Earlier this month, the Patels pleaded guilty to a felony charge. As part of the plea agreement, they will serve five years of probation, forfeit nearly $750,000 in illicit gains and pay an additional $5,000 fine.

Courchaine said the outcome represents a turning point for the area.

“Fathers will not be solicited for prostitution as they drop their kids off at school, and the neighbors living in the community won’t have to pass by and wonder what’s going to happen next at this seedy, awful motel that is ruining my neighborhood,” he said.

The nearly $750,000 forfeited by the owners will go into a federal victim assistance fund to support services and resources for victims.

As for the property itself, Courchaine said the federal government plans to place it back on the market, with the hope that a new owner will redevelop the site into something that benefits the community.

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