Clovis Woman Pleads Guilty to Money Laundering
Laundered Proceeds from the Sale of Synthetic Drugs
FRESNO, Calif. — Natalie Middleton, 30, of Clovis, pleaded guilty today to laundering proceeds from the sale of synthetic drugs, commonly known on the street as “spice,” Acting United States Attorney Phillip A. Talbert announced.
“Spice” refers to a smokable organic plant leaf that is laced with a synthetic cannabinoid, which is often a controlled substance or a controlled substance analogue. Public health and law enforcement agencies have seen the emergence of synthetic drug use. State and local public health departments note that synthetic cannabinoids cause serious adverse health effects, including agitation, anxiety, nausea, vomiting, tachycardia, elevated blood pressure, tremor, seizures, hallucinations, paranoid behavior, and even death.
According to court documents, Middleton purchased a Lake Tahoe time share with proceeds she obtained from the sales of smokable synthetic cannabinoids. According to her plea agreement, from January through March 2013, Middleton was employed as a national sales representative for ZenBio LLC (ZenBio). ZenBio was a “spice” manufacturing and distribution business that started in Pensacola, Florida in November 2012. It continued the operations of another “spice” company known as Zencense IncenseWorks LLC that processed the drug in warehouses in Stockton and Millbrae. The drugs were sold under the brand names “Bizarro,” “Orgazmo,” “Headhunter,” “Defcon,” “Neutronium,” “Sonic Zero,” “Sonic Boom,” “Sonic Blast,” “Shockwave,” “Hampster,” and “Posh.” ZenBio distributed these drugs during its approximate five-month life span. ZenBio generated in excess of $33 million from the sale of at least 24 tons of synthetic drugs. During the investigation of this case, law enforcement officers seized over $6 million in cash and assets derived from drug proceeds.
Court documents also reveal that, prior to her position with ZenBio, Middleton worked as a manager at the Stuffed Pipe, a chain of smoke shops in Fresno, Visalia, and Bakersfield. The Stuffed Pipe previously sold ZenBio and Zencense “spice” products.
Middleton is scheduled for sentencing on October 11, 2016. She faces a maximum statutory penalty of 10 years in prison and a $250,000 fine, or twice the gross gain from the crime. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
Last month, a co-conspirator, Timothy New, 33, of Pensacola, Florida pleaded guilty to the fraudulent interstate shipments of misbranded drugs. Co-defendants, Douglas Jason Way, 41, of Evanston, Illinois, and Timothy Ortiz, aka Michael Fitton, 45, of Waukegan, Illinois, have pleaded not guilty to various drug charges and are scheduled for a status conference on September 12, 2016. They face a maximum penalty of 20 years in prison and a fine of $10 million. The charges against them are only allegations; they are presumed innocent until and unless proven guilty beyond a reasonable doubt.
This case is the product of an Organized Crime Drug Enforcement Task Force (OCDETF) investigation by the Drug Enforcement Administration (DEA), the Internal Revenue Service-Criminal Investigation, the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), and the Fresno County Sheriff’s Office, with assistance from the Food and Drug Administration (FDA). The OCDETF Program was established in 1982 to mount a comprehensive attack against organized drug traffickers. Today, the OCDETF Program is the centerpiece of the United States Attorney General's drug strategy to reduce the availability of drugs by disrupting and dismantling major drug trafficking organizations and money laundering organizations and related criminal enterprises. This OCDETF investigation was also part of a nationwide law enforcement effort coordinated by the DEA’s Special Operations Division. Assistant United States Attorney Karen A. Escobar is prosecuting the case.