Addressees,
The following information relates to the fourth installment for 2004. These OCI cases have received convictions or related judicial action. The information is considered unrestricted.

Chicago Field Office
Sentencing/Convictions

The case was initiated upon a request for assistance from the Lincoln Park Michigan Police Department. The case was based on an allegation that John Michael KONYHA, a.k.a. "Nitrous John", d/b/a JOHN'S PERFORMANCE, sold medical grade nitrous oxide for recreational use. Lincoln Park Michigan Police Department officials advised that a successful "buy" of nitrous oxide for recreational use was made and a search warrant subsequently was executed on KONYHA'S residence. Approximately fifty (50) tanks were seized from the residence along with balloons, customer names, and other associated paraphernalia. Many of the tanks were labeled as nitrous oxide, "Rx only." Some of the tanks were labeled with AGA as the manufacturer. In addition, some of the "necks" of the tanks were stamped with WYANDOTTE WELDING COMPANY. KONYHA, when interviewed, stated that he had been selling nitrous oxide for the past 20 years. KONYHA stated he did not have a permit or license to sell the nitrous oxide. He had been purchasing the nitrous oxide from WYANDOTTE, Wyandotte, MI, who delivered the tanks to KONYHA'S residence approximately once a week. KONYHA stated he did not claim the nitrous oxide business on his tax returns. Subsequent to the interview of KONYHA, information was developed that Nathan HILL assisted KONYHA with the nitrous oxide recreational sales.

An AGA official confirmed that medical grade nitrous oxide was sold to WYANDOTTE for approximately two years. Samples of seized cylinders were tested by AGA officials to verify they contained medical grade nitrous oxide. In general, the results of the tested samples revealed that nitrous oxide was present in the cylinders, with purity levels ranging from 98.48% to 99.98%.
WYANDOTTE confirmed that the company sold nitrous oxide to KONYHA for approximately ten (10) years and indicated that the company only sold nitrous oxide with sulfur and/or commercial-grade nitrous oxide. After further review, WYANDOTTE confirmed that the company originally sold nitrous oxide with sulfur to KONYHA, but later changed to the medical grade nitrous oxide.

Records revealed that approximately 3,164 cylinders containing nitrous oxide were sold to KONYHA from approximately 1997 to 2002. The records revealed that the majority of nitrous oxide sold to KONYHA was medical grade nitrous oxide.
Tax return information was subpoenaed from KONYHA'S accountant. The information revealed that KONYHA did not claim the nitrous oxide business on his tax returns.

Purchasers of nitrous oxide from KONYHA were interviewed. Some purchasers confirmed they purchased nitrous oxide for recreational purposes, and some purchasers advised they purchased nitrous oxide for racing purposes.


On December 2, 2003, KONYHA and HILL were indicted for violating Title 18, U.S.C. § 371 - Conspiracy; and Title 21, U.S.C. §§ 331(k) and 333 (a) (2) - Misbranding of a Drug after Shipment into Interstate Commerce.

On February 12, 2004, HILL was interviewed. HILL stated he noticed some of the nitrous oxide labels were changed by WYANDOTTE, and KONYHA advised HILL the labels were changed since the nitrous oxide was "downgraded" from medical grade to automotive grade (due to the label change). HILL stated he believed many of the nitrous oxide purchasers were not racers due to the large amount of nitrous oxide they purchased, the times they purchased nitrous oxide, and due to the non-race vehicles they drove and the "hip-hop" style of dress they wore. HILL stated KONYHA should have known the purchasers were not racers due to the same reasons. HILL stated KONYHA requested many of the purchasers to complete index cards indicating they were racers. HILL believed KONYHA required this to prevent liability for KONYHA.

On March 9, 2004, HILL and KONYHA were both convicted of violating Title 21 U.S.C. §§ 331(k) and 333(a) (1) - Causing Drugs to be Misbranded after Shipment into Interstate Commerce.

On November 9, 2004, KONYHA was sentenced to (45) forty-five days of incarceration; (1) one year supervised release, and fined $48,000. HILL was sentenced to (2) two years probation.

Chicago Field Office
Sentencing/Convictions

This investigation was initiated based on information received from the United States Customs Service (USCS) (now the Department of Homeland Security) that a 20-foot container of imported food items, container number 1636849, was on a Canadian Pacific Railway train en route from Montreal, Canada, through Detroit, with a final destination at the Canadian Pacific Railway Yard, Chicago, IL. The importer of record for the food items was SALWAN TRADING COMPANY, Schaumburg, IL. The container contained Betel Nut products (a prohibited food product according to FDA Import Alert 23-06, revised July 17, 1992). However, no Betel Nut products were listed on the invoice/manifest or any other documents required for import.
On June 12, 2000, at the Canadian Pacific Railway Yard, Chicago, IL the contents of container number 1636849 and identified numerous boxes were examined and were imprinted with the words "Lijjat Papa Mumbai 80 Pkts X 200 gms. Approximately half of these boxes had stickers on them labeled, in part, "...Garlic Papad..." and half of the boxes did not have these stickers on them. An examination of five (5) of the boxes with the stickers, revealed that they contained a tortilla-type food product. However, an examination of five (5) of the boxes without the stickers, revealed that they contained crushed Betel Nut products. Samples of the Betel Nut products were obtained and subsequently analyzed. The analyses of the samples determined that they contained arecoline, the alkaloid that causes cancer and makes Betel Nut products a prohibited food item in the US. An examination of the invoice and other documents which accompanied this import and were subsequently presented to the FDA and USCS, in order to allow the import into United States commerce, revealed that the entry reportedly only consisted of various "assorted food products," imported from Veerprabhu Export House, Mubai, India. Surveillance revealed that the container was delivered to SALWAN TRADING COMPANY.
A search warrant was conducted at SALWAN TRADING COMPANY. During the search, a large quantity of Betel Nut products in various packaging and form (whole, crushed, processed and packaged with flavoring) and business records were seized. Also, during the search a customer was interviewed and admitted to having just purchased numerous types of packaged Betel Nut products from SALWAN TRADING COMPANY. The Betel Nut products purchased by this individual were seized as evidence.
During the search, Ayodhia SALWAN, Owner of SALWAN TRADING COMPANY, was interviewed and initially stated that his company never sold Betel Nut products. However, after he was shown the large amount of Betel Nut products that were being seized, SALWAN stated that he only sold Betel Nut products that had been laboratory tested, and released by FDA and DHS. SALWAN stated that he was the individual who placed the orders to his overseas food suppliers, to include Veerprabhu Export House. When SALWAN was shown the Betel Nut products in container number 1636849 and the accompanying documents that identified the contents of the container as "Lijjat Papa Mumbai" - food products, he stated that Veerprabhu Export House personnel placed the Betel Nut products in the shipment by mistake.
A review of the records identified eighteen (18) importations by SALWAN TRADING COMPANY, during the period January 1997 to June 2000, suspected of containing Betel Nut products.
On November 24, 2004, SALWAN TRADING COMPANY was convicted of violating Title 18, U.S.C. § 542 - Entry of Goods by Means of False Statements. SALWAN TRADING COMPANY was fined $16,000, and ordered to pay $4,753.73 in restitution to the United States government for avoiding customs duties.

Kansas City Field Office
Sentencing/Convictions

This case was initiated as part of an undercover operation named "OPERATION CHARLATANS", which targeted the import of counterfeit goods into the United States for sale to the public.

During this operation, a confidential informant introduced Louis URBINA, a Belize citizen, to undercover agents. URBINA indicated he could get any prescription drug counterfeited and packaged in counterfeit United States labeling. URBINA sold counterfeit Viagra and Lipitor, via mail to the undercover agents.
In May 2004, URBINA flew to the U. S. and met with an undercover agent in Beaumont, TX. He delivered counterfeit Lipitor and completed a deal to sell counterfeit Lupron. URBINA bragged during the deal that it did not matter that the Lupron would not work, as the cancer patients were going to die anyway. URBINA was arrested and held without bond. During interview, URBINA admitted the counterfeit drugs were manufactured in India but would not provide any additional details.
On May 21, 2004, URBINA was convicted of violating Title 21, U.S.C. § 331 (a) - Introduction into Interstate Commerce of a Misbranded Drug.
On September 24, 2004, URBINA was sentenced to (10) ten months incarceration and (1) one year probation.
This case was worked jointly with the United States Customs Service.

Kansas City Field Office
Sentencing/Convictions

This investigation was initiated upon receipt of a request from the Federal Bureau of Investigation in conjunction with the Nebraska Health Care Task Force, regarding an investigation of KOHLL'S PHARMACY. Marvin S. KOHLL, Registered Pharmacist, and his three pharmacist sons (DAVID, LOUIS and Justin KOHLL), are involved in diverting large quantities of pharmaceutical drugs from a closed-door pharmacy to their seven retail locations.
On February 16, 2000, members of the Nebraska Health Care Fraud Task Force comprised of the Office of Criminal Investigations, Federal Bureau of Investigation and the Nebraska State Health and Human Services, participated in the execution of nine simultaneous federal search warrants at the seven KOHLL'S retail pharmacies, the Unicare closed-door pharmacy, and KOHLL'S corporate office.
During August 2000, documents pertaining to a closed-door account set up entirely for diversion to KOHLL'S retail pharmacies were received from McKesson Wholesalers. Over $7,000,000 in pharmaceuticals was purchased and approximately $ 500,000 in charge backs resulted from this account in just a three (3) year period.
On August 25, 2004, Louis KOHLL was convicted of violating Title 18, U. S. C., § 1341 and 2 - Mail Fraud.

On November 15, 2004, Louis KOHLL was sentenced to probation for a period of (12) twelve months, of which the first (3) three months consisted of home confinement. KOHLL was also ordered to pay a fine of $250,000, and restitution in the amount of $500,000.

Los Angeles Field Office
Sentencing/Convictions

This investigation is predicated upon a referral from the Department of Health and Human Services, Office of the Inspector General (HHS-OIG). HHS-OIG was investigating allegations that Vimlesh AHMAD, MD, was up-coding bills for the office visits of Medicaid patients. In addition, DR. AHMAD was distributing pharmaceutical drugs without a physical exam, patient history, or an appropriate treatment plan, thus violating Title 21, U.S.C. 331 (k) and 21 U.S.C. 353 (b)(1)(B) - Misbranding of Drugs While Held for Sale.

The Washington State Department of Social and Health Services (WADSHS) reported that DR. AHMAD was providing patients with high levels of pharmaceutical drugs, such as carisoprodol and cyclobenzaprine (muscle relaxants), and controlled substances, such as Oxycontin, Endocet, and Roxicet.

HHS-OIG reviewed the Medicaid billing history for DR. AHMAD and learned that DR. AHMAD almost always used the Current Procedural Terminology (CPT) code 99215, which is the highest CPT code for an office visit, for all of her patient visits. CPT code 99215 is the billing code used for patients with moderate to high severity problems, typically requiring forty (40) minutes of individual time with the physician. It involves a comprehensive history and examination, and a high complexity of decision making.
Numerous surveillances of DR. AHMAD'S clinic were conducted. Patients were observed entering and leaving the clinic and vehicle licenses were noted and the registered owners of the vehicles identified. Several people were followed to local pharmacies and observed obtaining prescriptions. Many of the people were identified and their prescriptions noted. A few times, the subjects exited the pharmacy, and were observed exchanging drugs with other unidentified subjects. On one occasion, a pharmaceutical drug representative was observed arriving at DR. AHMAD'S office with a medium-sized box. The drug representative left several minutes later without the box. It is believed that drug samples were left with DR. AHMAD. Several minutes later, an individual entered DR. AHMAD'S clinic and left several minutes later with what appeared to be the same box. The individual was observed sitting in a car outside the office removing what was believed to be samples from individual boxes, repackaging the samples, and writing on the new packages. The individual was then followed to a local United States Post Office, where the packages were mailed.

On January 15, 2004, federal search warrants were served at DR. AHMAD'S clinic and residence. Patient records and financial records were seized at both locations. DR. AHMAD'S receptionist was interviewed by agents and agreed to cooperate with the investigation. The receptionist had worked for AHMAD for approximately (2) two years. She admitted to calling local area pharmacies and requesting prescriptions for drug seekers using DR. AHMAD'S Drug Enforcement Administration (DEA) number. She stated that she would call in (2) two prescriptions in the name of a drug seeker, the drug seeker would normally pay her $100, and the receptionist would get the second prescription. She would then sell the drugs from the second prescription on the street for a profit.

In April 2004, a former employee of DR. AHMAD was interviewed. The former employee recalled that she had typed chart notes for an Everett, WA man, who died of acute opiate poisoning in 2001. The man was a patient of DR. AHMAD's who had allegedly told DR. AHMAD that he thought he was over-medicated and was trying to reduce his narcotic medications. Allegedly, DR. AHMAD told him that he needed to stay on the high dosages to satisfy Washington State Labor and Industries, who was paying for the man's treatment as the result of a work-related injury. The man later died, and DR. AHMAD falsified chart notes that were submitted to the life insurance company.

On October 5, 2004, DR. AHMAD was convicted of (1) one count of Title 18, U.S.C. § 1347 - Health Care Fraud. DR. AHMAD was sentenced to (12) twelve months and (1) one day incarceration, and fined $100,000. She also agreed to give up her Washington State medical license, her DEA license, and she agreed not to practice medicine in the United States.
This was a joint investigation with HHS-OIG and the Federal Bureau of Investigation.

Los Angeles Field Office
Convictions/Sentencing

In February 2004, information was received by the Office of Criminal Investigations, Seattle, WA Domicile Office that Luc CLAES, and his associates were involved in smuggling unapproved and misbranded drugs thru the Blaine, WA, Port of Entry into the United States. CLAES and his associates were introducing a new unapproved drug into the United States from Canada known as "Double White Chocolate." This drug was deemed a "new culture drug" that contained a combination of both Viagra and Ecstasy.

On March 2, 2004, surveillance was conducted in Bellingham, Washington. During the surveillance, CLAES along with another individual were observed in a rented Canadian vehicle bearing BC Plate AHM-805. Indices checks revealed that the vehicle had recently crossed the border from Canada into the United States. During a consensual search of the vehicle CLAES was observed attempting to discard a bulky package by hiding it under a nearby vehicle. The package was seized and found to contain approximately eight hundred (800) unlabeled white capsules divided into small plastic bags. The capsules contained a white powder with blue flakes. CLAES was arrested and admitted that he smuggled the misbranded, unapproved drugs into the US from Canada. CLAES also stated that he knew the capsules he smuggled that day were some type of "party drug." The second individual was released and not charged. The capsules tested positive for methylenedioxymethamphetamine, otherwise known as MDMA, or Ecstasy. Additional tests were conducted to attempt to verify if Viagra was also present in the capsules. The results were negative.

On October 8, 2004, CLAES was sentenced to (18) eighteen months incarceration. CLAES was previously convicted of violating Title 21, U.S.C. § 841(a) (1) - Possession with Intent to Distribute; Title 18, U.S.C. § 371 - Conspiracy; and Title 21, U.S.C. § 952 (a) (2) - Importation of a Controlled Substance. CLAES was also processed for deportation back to Canada.

This was a joint investigation with the Department of Homeland Security, Bureau of Immigration and Customs Enforcement.

Los Angeles Field Office
Convictions/Sentencing

This case was initiated based on information received from the Department of Homeland Security, Bureau of Immigration and Customs Enforcement (ICE). Throughout 2002, ICE Inspectors at the Blaine, WA, Ports of Entry made numerous seizures of misbranded amyl nitrate, a prescription drug. ICE and the Office of Criminal Investigations, Seattle, WA Domicile Office, identified LOCKER ROOM MARKETING, LTD., as the Canadian company that was smuggling, distributing, and selling prescription drugs within the United States. The original complaint had identified Rod QUIROS and his associates as the smugglers in this organization. Amyl nitrate was identified as a misbranded adulterated vassal dilator. According to ICE regulations, amyl nitrate was an inadmissible product.

On December 18, 2002, two (2) shipments of amyl nitrate were seized at the Pacific Highway Port of Entry in Blaine, WA. Both shipments were on the same commercial truck carrying unrelated merchandise.

The first seizure consisted of 2,214 vials contained in ten (10) boxes with the seller listed as LOCKER ROOM MARKETING. The buyer/consignee was listed as JSA CORP, 1360 West 1st Street, Pomona, CA. The shipper was listed as AMCORP, 105-1005 Columbia Street, New Westminster, British Columbia. The ICE office in Vancouver, Canada, assisted in identifying the Columbia Street address in Canada. The address was identified as a mail drop facility.

The second seizure consisted of 1,440 vials of amyl nitrate invoiced as "cleaning supplies-liquid form-10ml." The buyer was listed as John LEWIS/Don WESTON, #175-2997 Druid Hills Rd., Atlanta, GA. The shipper was listed as A-1 Janitorial Supplies LTD, Suite 296-3495 Cambie St, Vancouver, British Columbia. The ICE office in Vancouver, Canada, assisted in identifying the Cambie Street address in Canada as a mail drop facility.

ICE and OCI discovered that LOCKER ROOM MARKETING was repeatedly attempting to smuggle amyl nitrate into the United States from Canada by disguising it as room deodorizer, cleaning supplies, and boot cleaner. Moreover, the seized vials were all marked with various names, such as Leather Cleaner, Jungle Juice, Rush, Taiwan Blue, Man Scent, and Z Best Cleaner. Some bottles were marked as flammable and toxic and not to be sold to minors.

On February 21, 2003, 2,996 vials of amyl nitrate were seized at the Port of Entry in Blaine, WA. The shipper of the smuggled amyl nitrite was identified as LOCKER ROOM MARKETING. The shipper listed two (2) consignees: JS MARKETING at 219 East 26th Street, New York City, NY, buyer of 1,298 vials invoiced as room odorizer; and WHIRLWIND, C/O WESTON, in Decatur, GA, buyer of 1,698 vials, also described as room odorizer.

On October 14, 2003, OCI was contacted by the ICE Attaché in Vancouver, Canada. The Attaché informed that ICE in Atlanta, GA, was working a similar case involving misbranded isobutyl nitrite.

On October 14, 2003, ICE in Atlanta, GA contacted OCI and informed them that they had conducted several search warrants on a business identified as WHIRLWIND DISTRIBUTING in Decatur, GA. ICE advised that they believed that WHIRLWIND DISTRIBUTING, WESTON, and Roberto AMA were all associated to LOCKER ROOM MARKETING in Vancouver, Canada. ICE Blaine and OCI Seattle corroborated the information.

On October 17, 2003, OCI received a telephone call from a Compliance Investigator with the Consumer Product Safety Commission (CPSC) stating that he also had conducted an investigation of LOCKER ROOM MARKETING. The Investigator stated that he spoke to AMA and wrote him a letter in late 2002 telling him to cease and desist in producing and distributing amyl nitrate product in the United States. The Investigator stated that AMA agreed and said he and his company would stop sending amyl nitrate products into the United States. The Investigator stated that AMA and his associates continued to distribute amyl nitrate in the United States.

On January 16, 2004, an in-depth record check was conducted on LOCKER ROOM MARKETING. The checks revealed that, since 1998, LOCKER ROOM MARKETING and its associates had attempted to smuggle approximately 1,528 kilograms (3,361 pounds) of unapproved amyl nitrate into the United States from Canada.

On June 15, 2004, a Civil Penalty was issued against LOCKER ROOM MARKETING and AMA for $104,409.00 for violation of Title 18, U.S.C. § 1595- Undervalue of Merchandise.

On August 25, 2004, WESTON was convicted of one (1) felony count of Title 18, U.S.C. § 545- Smuggling Isobutyl Nitrite into the United States from Canada.

On November 19, 2004, WESTON was sentenced to one hundred and eighty days (180)
days home confinement with electronic monitoring, two (2) years probation, and a $3,000 fine. WESTON also forfeited approximately $98,000 seized from his business bank account to the United States government.

Miami Field Office
Sentencing/Convictions

This case was initiated based upon a referral from the FDA, New Orleans District Office and information received from the Department of Homeland Security, Bureau of Immigration and Customs Enforcement (BICE) regarding the sale of bottled water that was smuggled into the United States from Canada by WGM MARKETING. The smuggled bottle water was believed to be adulterated as complaints were received indicating that the product had an "off" taste.

The investigation identified the manufacturer of the water as Clearly Canadian Beverage Corporation (CCBC) who contracted with Recycle Plus for the destruction of 1,556,568 bottles of water. Recycle Plus instead sold the bottled water either to itself or through Littlewolf Enterprises, Inc., to WGM MARKETING, a company that specializes in selling distressed merchandise. CCBC advised BICE that the water was an "off spec" problem dealing with a bad taste. CCBC informed BICE that they became suspicious of Recycle Plus when they could not obtain verification of destruction and Recycle Plus' subsequent reluctance to cooperate in the reconciliation of the inventory.

On July 31, 2003, BICE executed a search warrant on WGM MARKETING resulting in the seizure of approximately 317,568 bottles of Reebok Fitness Water. A constructive seizure agreement was executed and signed by William McDaniel, owner of WGM Marketing, regarding the Reebok Fitness Water. During the execution of the search warrant, samples of the Reebok Fitness Water were taken by FDA for further analysis.

On April 2, 2004, WGM MARKETING, represented by McDaniel, was convicted of Title 21, U.S.C. § 331 (a) - Introduction into Interstate Commerce of Adulterated Food; and Title 18, U.S.C. § 545 - Smuggling. The company was later sentenced to (1) one year probation, fined $15,000; and ordered to pay restitution of $11,049. McDaniel was instructed to take the necessary steps toward dissolution and effective termination of WGM MARKETING.

Miami Field Office
Sentencing/Convictions

This investigation was initiated based on information regarding the illegal activities of a food processing plant called Lumen Food Corporation, located in Lake Charles, Louisiana. Lumen Food Corporation advertised products via an Internet website www.altcancer.com under the name of Alpha Omega Labs, located in Nassau, Bahamas. These products were advertised as containing medicinal qualities for the treatment of cancer and many other diseases.

From 1999 to 2003, Gregory CATON, President of Lumen Food Corporation, and his employees utilized Alpha Omega Labs to take direct orders for these unapproved new drugs. The chemical substances were not approved for sale by the FDA. As a result of the scheme, CATON received approximately $950,000. In order to legally market a drug in interstate commerce, the drug's manufacturer is required to comply with all applicable provisions of the Federal Food, Drug, and Cosmetic Act in order to ensure that the products sold are safe for humans and effective for their intended uses.

On at least two occasions known to the FDA, the items shipped by CATON's firm and used by consumers resulted in bodily injury and harm. The products were Cansema Tonic III and H3O. Cansema Tonic III was advertised for use in the cure, mitigation, treatment, or prevention of cancer. H3O was advertised for use in the cure, mitigation, treatment, or prevention of athlete's foot, cuts and burns, eczema, fingernail fungus, chronic gas, gastroenteritis, gingivitis and periodontal disease, halitosis, herpes sores, ophthalmia, psoriasis, sore throat, strep throat, and wounds. CATON did not have an Investigational New Drug (IND) application on file with the FDA.

On September 17, 2003, a federal search warrant was executed at CATON's residence, Lumen Food Corporation, and an industrial site owned by CATON. All of these locations were in Lake Charles, Louisiana.
During the search of CATON's residence, a cache of weapons was found consisting of three semi-automatic rifles, one bolt action rifle, two shotguns, a semi-automatic pistol, 10, 252 rounds of amunition, three body armor vests, leg armor and two bullet resistant helmets. The weapons, armor and ammunition were found concealed in a hidden compartment that was inside a closet. CATON was arrested on possession of firearms by a convicted felon.

Numerous misbranded and unapproved new drugs were seized during the search at Lumen Foods, as well as items deemed as hazardous materials by chemical engineers. Also seized were (16) sixteen (55) fifty-five gallon drums of a liquid corrosive material at the industrial site owned by CATON. This liquid was subsequently identified as sulfuric acid and was mislabeled as non-corrosive. All of the hazardous materials seized were subsequently destroyed by a hazardous materials disposal company.

On May 26, 2004, CATON was convicted of violating Title18, U.S.C. § 1341 - Mail Fraud; and Title 21, U.S.C. §§ 331(d), 355(a) and 333 (a) (2) - Introduction into Interstate Commerce of Unapproved New Drugs. CATON also forfeited (2) two buildings and his residence in Lake Charles, Louisiana.

On August 24, 2004, CATON was sentenced to (33) thirty-three months incarceration to be followed by (3) three years supervised release.

This was a joint investigation with the Lake Charles and Westlake Police Departments.

Miami Field Office
Sentencing/Convictions

This investigation was initiated based on a request for assistance from the Louisiana State Board of Wholesale Drug Distributors (LSBWDD) regarding allegations they received concerning the unlawful sale of pharmaceuticals within the state by a firm identified as G & L Clinical. The LSBWDD informed the Office of Criminal Investigations, New Orleans Resident Office, that G & L Clinical was not licensed by the State of Louisiana as a wholesale drug distributor. Louis LENFANT, a pharmacist, was identified as the Owner of G & L Clinical as well as another firm called Mediquip, an infusion pharmacy. From May 18, 1998 to September 17, 2001, G & L Clinical engaged in the unlawful wholesale distribution of pharmaceuticals totaling $722,506 in sales to a medical clinic in New Orleans.

During the course of the investigation, the Louisiana Board of Pharmacy (LBP) advised that LENFANT was terminated on October 30, 2002, by Memorial Medical Center for stealing from the pharmacy's inventory. The LBP subsequently provided copies of the results of the audit conducted by Memorial Medical Center and additional information related to the pharmacy board's investigation.

The audit revealed significant shortages in the drugs Aredia, Taxol and Epogen. These drugs were also documented to be wholesaled by G & L Clinical.

On June 9, 2004, LENFANT was convicted of violating Title 21, U.S.C. §§ 331(t), 353(e) (2) (A), and 333(b) (1) (D) - Unlicensed Wholesale Drug Distribution.

On September 29, 2004, LENFANT was sentenced to (15) fifteen months incarceration, $500,000 restitution to Memorial Medical Center, and (3) three years of supervised release.

This was a joint investigation with the Department of Health and Human Services, Office of the Inspector General, the Louisiana Attorney General's Office, and the Orleans Parish Sheriff's Office.

Miami Field Office
Sentencing/Convictions

An investigation was conducted based upon information provided by the Drug Enforcement Administration (DEA) in Mobile, Alabama. According to the DEA, Gary SMITH, owner of OMEGA PHARMACEUTICALS, received and distributed prescription drugs that were repackaged with counterfeit labeling bearing registered trade names of prescription drugs.

On February 24, 2004, a federal search warrant was executed at OMEGA PHARMACEUTICALS in Daphne, Alabama. The items seized included images of computer hard drives, business documents, and various prescription drugs suspected to be in counterfeit packaging. These drugs consisted of multiple bottles of (11) eleven registered trademarked prescription drugs used in the treatment of HIV/AIDS, gastric ulcers, acid reflux disease, and psychotic mental disorders. Forensic analysis confirmed that the drugs were in fact counterfeit in that they were repackaged, relabeled and/or contained different strengths or mixed strength dosages differing from their labeled contents. In addition, the drugs bore extended expiration dates. Most of the drugs were defective as to packaging, labeling, and inserts. Some of the seized prescription drugs showed signs that they were not stored in a temperature controlled environment.

On June 9, 2004, OMEGA PHARMACEUTICALS, represented by SMITH, was convicted of violating Title 21, U.S.C. § 331 (i) (3) - Selling and Holding for Sale a Counterfeit Drug.

On October 6, 2004, OMEGA PHARMACEUTICALS was sentenced to (5) five years probation, and fined $24,000.

This was a joint investigation with the Federal Bureau of Investigation and the Daphne Police Department.

Miami Field Office
Sentencing/Convictions

This investigation centered on the criminal activities of a registered nurse at the Winter Haven Regional Hospital, Winter Haven, FL.

The investigation revealed that during the year 2001, Robert David SHEDD, RN had tampered with seventy-three (73) vials of Meperidine HCL and twenty-five (25) vials of Morphine Sulfate by removing a portion of the medications and replacing the medication with water. SHEDD used the stolen medication to satisfy his addictions.

During the course of this investigation conducted by the Winter Haven Police Department and the Office of Criminal Investigations, Miami Field Office, SHEDD was identified as having uncontrolled access to the controlled medications container in the Winter Haven Regional Medical Center, Progressive Care Unit, Winter Haven, FL. Several vials of Meperidine HCL had been found to be sub-potent and upon inspection appeared to have been punctured through the top.

During the course of this investigation one hundred and twenty-nine (129) samples of Morphine, Meperidine HCL or Lorazepam were collected and submitted to the FDA's Forensic Chemistry Center (FCC), Cincinnati, OH for analysis. The Forensic Chemistry Center conducted individual examinations of the samples and determined that ninety-eight (98) vials had been punctured through their rubber top/stoppers.

On October 17, 2004, SHEDD was sentenced to two (2) years house arrest and ten (10) years probation. SHEDD was also ordered to permanently surrender his nursing license and to undergo periodic urinalysis and psychological treatment. SHEDD had previously been convicted of state felony charges of Tampering with a Consumer Product and Criminal Possession of Morphine and Meperidine.

New York Field Office
Sentencing/Convictions

This investigation was initiated to review the activities of Dr. Wallace GONSALVES and pharmacy owner Anthony ALBANESE. GONSALVES was a Cranston, RI, based doctor who provided patients with diluted/adulterated vaccines and provided the Immigration and Naturalization Service (INS) (now the Department of Homeland Security) with false documents relative to health/blood screenings of immigrant patients. Additionally, GONSALVES sold large quantities of drug samples to ALBANESE who subsequently distributed the samples through Cameron's Pharmacy, a business ALBANESE owns and operates.

On March 17, 2004, after a three week jury trial, GONSALVES was convicted by a jury on thirty-one (31) felony counts including Title 18, U.S.C. § 1365 - Tampering with a Consumer Product; Title 21, U.S.C. § 331 (k) - Adulteration of a Drug; Title 18, U.S.C. § 1001 - False Statements; Title 26, U.S.C. § 7201 and 2 - Making False Statements to the IRS; and Title 26, U.S.C. § 7206 - Tax Evasion.

On September 14, 2004, GONSALVES was sentenced to (10) ten years incarceration for diluting vaccines administered to immigrant patients, and (5) five years incarceration for each of the remaining thirty (30) counts all of which are to be served concurrent to the imposed ten (10) year sentence. GONSALVES was ordered to pay $465,000 in restitution to patients to whom he administered diluted vaccines, and serve (5) five years supervised release.

Also on September 14, 2004, GONSALVES was convicted of Title 18, U.S.C. § 371 and Title 21, U.S.C. § 331 (t) - Conspiracy to Sell Drug Samples and Unlawful Sale of Drug Samples; and Title 18, U.S.C. § 1347 - Health Care Fraud. GONSALVES was sentenced to (37) thirty-seven months incarceration to be served concurrently with the ten year sentence. In addition, GONSALVES was ordered to repay $431,411 to health insurers that reimbursed Cameron's Pharmacy for the prescriptions that were filled with the free samples. GONSALVES was also fined $45,000.

On November 5, 2004, ALBANESE was sentenced to (37) thirty seven months incarceration, forfeited $431,410 to the United States government and fined $45,000. ALBANESE was previously convicted of Title 18, U.S.C. § 371 - Conspiracy; Title 21, U.S.C. § 331 (t) -Unlawful Sale of Drug Samples; Title 18 USC § 1347 - Health Care Fraud; and Title 18, U.S.C. § 1956 - Money Laundering. The conviction was based on a scheme which diverted drug samples received by GONSLAVES through Cameron's Pharmacy located at 2206 Broad Street, Cranston, RI. Between July 2000 and August 2002, GONSALVES sold ALBANESE samples of a variety of drugs, including Avandia, Prilosec, Vioxx, Lipitor, Celebrex, and Paxil. Cameron's Pharmacy, in turn, sold 209,797 of the sample pills in prescriptions and then illegally received $431,410.62 from health insurers by filing fraudulent reimbursement claims.

This was a joint investigation with the Department of Health and Human Services, Office of the Inspector General, Department of Homeland Security, Internal Revenue Service, the Rhode Island Department of Public Health, and the Rhode Island Medicaid Fraud Control Unit.

New York Field Office
Sentencing/Convictions

This case was initiated based on information regarding the tampering of prescription drugs by subject Nancy DEAN. DEAN was a nurse at Eastern Medical Center in Bangor, ME and Cummings Healthcare Facility, Howland, ME. DEAN was found to have been substituting vials of Stadol for vials of Morphine and Nitroglycerine tablets for Morphine tablets.

In May 2000, DEAN was interviewed by the Maine Attorney General's Healthcare Crimes Unit and admitted to taking the Morphine liquid and replacing it with Stadol and to substituting the Morphine pills with Nitroglycerine tablets. DEAN was subsequently charged with misdemeanor drug diversion by the Maine AG's Office. DEAN failed to appear at her arraignment and fled the state of Maine. DEAN was later identified as living in Texas.

In June 2003, information was received from Susan Manning, the sister of DEAN, that DEAN and her boyfriend Michael Bracy had been living with DEAN's parents in Texas. During the month of June 2003, DEAN and Bracy moved to the Bangor, ME area.

After DEAN returned to Maine, the United States Attorney's Office opened an investigation against DEAN. On October 1, 2003 DEAN was arrested and charged with violating Title 18, U. S. C. § 1365(a) - Tampering with a Consumer Product; and Title 21, U.S.C., § 331(k)- Misbranding of Drugs after Introduction into Interstate Commerce.

In February 2004, it was learned through Manning that DEAN left Maine, thereby violating the conditions of release set by the court.

Investigation by the Office of Criminal Investigations identified DEAN was residing in Glenmont, NY. This information was relayed to the United States Marshals Service. Later in the month, DEAN was arrested in Pensacola, FL and transported back to Maine by the Marshals Service. DEAN was remanded until her sentencing.

On March 16, 2004, DEAN was convicted of violating Title 18, U. S. C. § 1365(a) -Tampering with a Consumer Product.

On October 26, 2004, DEAN was sentenced to (71) seventy-one months incarceration and (3) three years of supervised release.

This is a joint investigation with the Maine Healthcare Crimes Unit.

New York Field Office
Sentencing/Convictions

On July 29, 2002, information was received that Medi-Hut Inc., a medical and drug wholesaler, headquartered in Lakewood, NJ and publicly traded on the NASDAQ, may be involved in stock manipulation and the distribution of an unapproved drug called Syntest. Syntho Pharmaceuticals, Farmingdale, NY, the manufacturer of Syntest, and Medi-Hut teamed up to market Syntest, a new generic hormonal replacement therapy similar to the drug Estratest made by Solvay Pharmaceuticals. The FDA, Center for Drug Evaluation and Research, confirmed that Syntest had not been approved by the FDA.

On August 19, 2003, Joseph A. SANPIETRO, President and Chief Executive Officer, Medi-Hut, Laurence M. SIMON, Chief Financial Officer, Medi-Hut, and Lawrence P. MARASCO, V.P. Sales and Marketing, Medi-Hut, were convicted of violating Title 18, U.S.C. § 371 - Conspiracy to Commit Securities Fraud and Wire Fraud; and Title18, U.S.C. §1001 - False Statements to the Securities and Exchange Commission (SEC). Vincent J. SANPIETRO, Chief Operations Officer and Director, Medi-Hut, was convicted of violating Title 18, U.S.C. §1505 - Obstruction of Proceedings.

On November 16, 2004, Joseph A. SANPIETRO was sentenced to forty-six (46) months incarceration and a $50,000 fine; SIMON was sentenced to forty-six (46) months incarceration and a $5,000 fine; and MARASCO was sentenced to forty-two (42) months incarceration and a $70,000 fine. Vincent SANPIETRO was sentenced to six (6) months home detention, three (3) years probation, and a $5,000 fine for obstruction.