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Press Release

California Drug Supplier Pleads Guilty to Distributing Millions of Dollars in Drugs

For Immediate Release
U.S. Attorney's Office, Western District of Pennsylvania

PITTSBURGH - The primary supplier of more than 3,000 pounds of high-grade marijuana sent to Pittsburgh, Philong Chuong, 52, of San Leandro, Calif., entered a plea of guilty to conspiracy to distribute marijuana and money laundering conspiracy, according to United States Attorney David J. Hickton. The plea was entered in federal court before United States District Judge Nora Barry Fischer. The wholesale value of the marijuana distributed here exceeded $14 million, with the ultimate retail, or “street value”, being several multiples of that.

In connection with the guilty plea, the court was advised that co-conspirator Jennifer Chieu moved to Pennsylvania from California in 2010, and by October of that year was in the drug business, using her old contacts to ship her 10-20 pound packages of high-quality marijuana from California on a daily basis. Chieu then resold the marijuana for $2,400-$4,600 a pound, depending on quality, to a small network of dealers. Philong Chong became Jennifer Chieu’s primary supplier.

United States Postal Inspectors eventually identified more than 250 inbound drug packages, and in excess of 350 outbound parcels containing drug proceeds, with $12,000-$20,000 in each package.

Postal inspectors and IRS and FBI special agents observed Chieu making deals out of her Green Tree home and a nail salon she owned on Liberty Avenue in the Bloomfield section of Pittsburgh.

Between January and April 2011, postal inspectors served nine search warrants on random outgoing parcels suspected to contain drug proceeds. Each of the parcels contained between $12,000 and $20,000 in cash, with the total exceeding $143,000. All were mailed to Chuong in California.

Wiretaps were approved for Chieu’s phones and several others between June and October 2011. Chuong and Chieu and their co-conspirators spoke four languages on the wiretaps – Vietnamese, English, and two Chinese dialects - often switching languages in mid-sentence in an obvious attempt to hamper law enforcement agents and interpreters who might be listening.

More than a hundred hours of calls were intercepted between Chuong and Chieu. On a daily basis, they discussed how much marijuana he would be sending, the quality or “brand name” of the product, how much Chieu would charge for it here, and how many packages of cash she planned to send to California the following day.

Large seizures of cash demonstrated the broad scope of this drug ring, with more than one million dollars seized. In one example, in April 2012, Chuong and Chieu were stopped in Utah for a traffic violation. Hidden within their car was more than $500,000 in cash. Both individuals refused to claim the cash, with Chieu telling officers she didn’t know how it got there.

Following the indictment of Chuong and Chieu and 18 other individuals, Chieu was arrested in April 2012, at which time more than $70,000 was seized from her Green Tree home, and $100,000 from a safe deposit box. Another seizure in 2011 of drug proceeds from a van leaving Pittsburgh for California turned up $136,000 in cash. In addition to the seizure of more than one million dollars in this investigation, homes and cars were also seized for forfeiture to the government.

Nineteen of the 20 indicted individuals have now entered pleas of guilty, with most sentenced.

On motion of the government, Philong Chuong’s bond was revoked and he was ordered detained pending sentencing on Dec. 10, 2015. The law provides for a total sentence of not less than five years to 40 years in prison, a fine of $5,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the criminal history, if any, of the defendant.

Assistant United States Attorney Gregory J. Nescott is prosecuting this case on behalf of the government.

The U.S. Postal Inspection Service, the Internal Revenue Service – Criminal Investigation, and the Federal Bureau of Investigation were the lead agencies in this case, and were assisted by the Pennsylvania State Police in this investigation that led to the prosecution of Philong Chuong.

Updated September 1, 2015