It was the $2,500 watch and the $13,000 Mustang that put authorities on the trail of 18-year-old Frank Riley Wolsky.

Investigators say the high school senior attended school regularly while running a cocaine business on the side and spending thousands of dollars on cars, clothes and jewelry.The teenager's fast-lane lifestyle came to a halt Jan. 18 as he prepared to go to school in this suburb east of Portland. Undercover police surrounded his car and arrested him on charges of possession and delivery of a controlled substance.

Officers found 4 ounces of cocaine, five firearms and $18,000 in cash. Also seized was a Chevrolet Corvette, customized Ford Mustang and a Chevrolet Blazer.

In November 1987, when he was 16, Wolsky was arrested on a drug-possession charge. His mother, Myra Wolsky, told authorities at the time she thought he was a dealer, but the possession case never went to trial.

The Regional Organized Crime Task Force, an interagency law enforcement group, began investigating Wolsky in earnest last year after parents and businessmen told police about his spending sprees, said investigator Bob Peterson.

Reports of an $1,800 clothes-buying trip and the purchase of the $2,500 watch crossed detectives' desks.

"We began looking at his activities and found that he was purchasing vehicles for cash," Peterson said. "He purchased a 1986 Mustang on Sept. 24, 10 days after his 18th birthday, for $13,000 cash.

"He moved into a $1,000-a-month apartment on Aug. 8. We looked at cash expenditures of $25,000 over a one-month period," he said.

"It all began to develop a pattern not consistent with a high school student."

Peterson said Wolsky did most of his business from his third-floor apartment at Johns Landing, a trendy section of Portland a world away from Gresham.

Wolsky didn't use drugs himself, maintained a low profile at the apartment and was known as a "nice guy" at school, Peterson said.

"Four or five primary customers of Wolsky's were the only ones who came to the apartment," Peterson said. "There were no wild parties."

Investigators believe Wolsky was a relatively small-scale dealer until he met Narcisa L. Savinovich, who was at the time free pending appeal after being sentenced to five years in prison for selling cocaine. The night before his arrest last month, Wolsky stopped at the 26-year-old woman's house and emerged with two paper bags, Peterson said.

Savinovich was arrested, indicted on new drug charges, and immediately began serving her previously imposed sentence.

Alex Gordon, special assistant U.S. attorney, said Oregon charges against Wolsky have been withdrawn so that he can be prosecuted in the federal system, where stiffer sentences are possible. A federal grand jury is considering the case.