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Forfeiture of over $29 million in Internet Pharmacy proceeds

January 7, 2011

BEAUMONT, Texas - A 49-year-old New York man has been sentenced to federal prison in a wide-scale internet pharmacy drug conspiracy in the Eastern District of Texas announced U.S. Attorney John M. Bales. 

                David Allen Vogel was convicted on June 30, 2010, of conspiracy to distribute a controlled substance, conspiracy to commit money laundering, and two counts of money laundering and was sentenced today to a total of 240 months in federal prison by U.S. District Judge Marcia Crone.  Vogel was also ordered to pay a money judgment in the amount of $24,743,000 and forfeiture of $4,376,471.39, which had already been seized from six separate bank accounts.

Vogel, the owner and operator of Madison Pain Clinic, was convicted by a jury following an eight-day trial in July 2010, of conspiring with others to operate an Internet-based pharmacy through which they distributed millions of hydrocodone pills and other controlled substances without a valid prescription.  Vogel used proceeds from the illegal enterprise to purchase a multi-million condominium in Trump Towers in New York City and rare coins, including a $36,000 penny.  Vogel was indicted on Dec. 10, 2008 and a superseding indictment was filed on Aug. 13, 2009, charging Vogel and 3 others with federal drug and money laundering violations. 

Co-defendants Jonathan C. Vogel pleaded guilty on June 21, 2010, to misbranding of drugs and is awaiting sentencing.  Joseph A. Geraci remains a fugitive.  Additionally, Dr. David Hoblit of Dallas and Ghassan Naddaf of Houston each pleaded guilty the drug conspiracy.  Hoblit was sentenced to 18 months in federal prison and ordered to forfeit nearly $135,000 and pay a fine in the amount of $5,000.   Naddaf was sentenced to 12 months in federal prison and forfeiture of $1.8 million. Carrie L. Demers pleaded guilty on Apr. 29, 2010, to using a communication device in furtherance of a drug crime and was sentenced to 30 days in federal prison and three years probation.

                This case was investigated by the DEA and the IRS and was prosecuted by Assistant U.S. Attorneys Stevan Buys, Maureen Smith and Kevin Collins.


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