Two KC Residents Plead Guilty to K2 Conspiracy, Must Forfeit $10.5 Million

KANSAS CITY, Mo. – Tom Larson, Acting United States Attorney for the Western District of Missouri, announced that two former Kansas City, Mo., residents pleaded guilty in federal court today to their roles in a $10.5 million conspiracy to distribute synthetic cannabinoids, commonly referred to as K2, to customers nationwide.

Derek A. Williams, 35, and Ashli Adkins, 31, both of Laguna Beach, Calif., but formerly of Kansas City, each pleaded guilty before U.S. District Judge Stephen R. Bough to one count of conspiracy to mislead by causing the introduction of misbranded drugs into interstate and foreign commerce and one count of conspiracy to commit money laundering.

Williams and Adkins admitted they sold at least 2,000 kilograms of synthetic cannabinoids during the conspiracy. Under the terms of today’s plea agreement, Williams and Adkins must forfeit to the government their Laguna Beach residence, a $10.5 million money judgment (including nearly $3.4 million seized by federal agents during the investigation), a 2011 Ford F-150, a Glock 9mm pistol, a Walther .22-caliber pistol, a Mossberg 12-gauge shotgun and a Bushmaster .223-caliber rifle.

Williams and Adkins admitted that they participated in a conspiracy to market synthetic cannabinoids, which were misbranded drugs because their labeling was false and misleading, from March 1, 2011, to Nov. 27, 2012.

Labeling identified the products as “incense,” and “not for human consumption,” and failed to bear adequate directions for use. Synthetic cannabinoid products were packaged in foil packets and sold at retail establishments throughout the United States under the brand name “SynIncense.” Williams and Adkins admitted they used the term “incense” in the product brand name when, in fact, his “SynIncense” products were synthetic cannabinoids intended for consumption in order to obtain a physiological effect of a “high.”

Each of the synthetic cannabinoid products was misbranded in at least one of the following respects:

a. The synthetic cannabinoid products’ labeling did not bear adequate directions for use;

b. The synthetic cannabinoid products had false and misleading labeling in that they were labeled in a manner indicating they were not for human consumption when, in fact, the synthetic drugs were intended for human consumption; and

c. The synthetic cannabinoid products did not bear a label containing the name and place of the business, the manufacturer, packer or distributor.

Williams and Adkins sold synthetic cannabinoids to an unindicted co-conspirator doing business as Main Stop in Neosho, Mo., who then resold the misbranded drugs to consumers. They also shipped or transported misbranded synthetic cannabinoids to another unindicted co-conspirator, doing business at the website Commonscents.com, who then resold the misbranded drugs to consumers.

Williams and Adkins also admitted that, from March 1, 2011, to July 8, 2012, they participated in a money-laundering conspiracy that involved financial transactions of funds derived from criminal activity.

Williams and Adkins are among four defendants who have pleaded guilty in this case. Co-defendant Daniel R. Williams, 31, of Kansas City, was sentenced to three years in federal prison without parole. Co-defendant Charidy Blankenship, 31, of Kansas City, has also pleaded guilty and awaits sentencing.

This case is being prosecuted by Assistant U.S. Attorney Catherine A. Connelly and Special Assistant U.S. Attorney Matt Moeder. It was investigated by the U.S. Drug Enforcement Administration and IRS-Criminal Investigation.