Seven Involved with Online Pharmacy Based in Florida Indicted for Internet Pharmacy and Money Laundering Conspiracy
Former Policeman And Various Employees Indicted For Operating An Illegal Internet Pharmacy
A federal grand jury in the Western District of Washington indicted seven people late yesterday for an illegal drug distribution scheme involving an internet pharmacy, announced U.S. Attorney Jenny A. Durkan. The originator of the scheme, JUAN GALLINAL, 41, of Pembroke Pines, Florida will be summoned to appear for arraignment in Seattle. The internet pharmacy distributed drugs to some 200 customers in Washington State between 2009 and 2012. The indictment alleges that the pharmacy shipped hundreds of thousands of pills of hydrocodone, phentermine, alprazolam (Xanax) and codeine (Tylenol 4) to people across the country who did not have valid prescriptions for the narcotics. The group is alleged to have brought in more than $9 million in revenue from the sale of pills during the three year scheme. The pharmacy operated four internet sites through which they solicited customers and allowed customers in Washington State to order drugs, including the website www.frontierpharmacies.com. The conspirators allegedly laundered the proceeds of their sales through a brick-and-mortar pharmacy in Florida called Discount Pharmacy of Pines. In June 2012, the DEA shut down the operation by seizing the conspiracy’s websites, computers, and drug inventory.
“These criminal conspirators harnessed the power of the internet to become virtual drug dealers. They lined their pockets by feeding the devastating addictions in our communities,” said U.S. Attorney Jenny A. Durkan. “They shipped drugs to hundreds of customers in Washington State, most of whom did not have a valid prescription, had never seen a doctor, and had no legitimate medical purpose. Once these criminals knew that Western Washington law enforcement agents were on to their scheme, they tried to simply shift their criminal conduct to other regions of the country. I commend the dedicated DEA and FDA agents and prosecutors who continue to investigate this case.”
“Pill mills and rogue internet pharmacies are set up to sell addiction,” said DEA Special Agent in Charge Matthew G. Barnes. “These defendants raked in over $9 million in illicit drug proceeds and contributed to the nationwide prescription drug and heroin epidemic. I appreciate the ongoing commitment and cooperation of our federal, state and local partners.”
GALLINAL, a former police officer from Virginia, is charged in all five counts of the indictment: conspiracy to distribute controlled substances by means of the internet; conspiracy to distribute controlled substances; conspiracy to introduce misbranded prescription drugs into interstate commerce; conspiracy to commit money laundering; and destruction, alteration, and concealment of records. In addition to GALLINAL, six other conspirators are charged in some of the counts:
JORDAN TRUXELL, 25, of Davie, Florida served as the registered agent for Discount Pharmacy dba frontierpharmacies.com. He is charged in four counts of the indictment.
ALI LOVINS, 41, of Cooper City, Florida is a registered nurse and was the office manager for Discount Pharmacy. She is charged in four counts of the indictment.
THOMAS BROOKE, 52, of Cooper City, Florida was the bookkeeper for Discount Pharmacy. He is charged in four counts of the indictment.
CRAIG GREER, 40, of Hollywood, Florida, a former police officer, worked to promote the internet pharmacy scheme. He is charged in four counts of the indictment.
KEVIN KOGAN, 44, of Cedar Park, Texas, set up the websites and servers for the online pharmacy, and attempted to hide the conspiracies databases from investigators. He is charged in four counts of the indictment.
JERRY DELMAN, 81, of Miami, Florida, a pharmacist who ostensibly oversaw the prescriptions going out the door to customers.
According to the indictment, the conspiracy would continue to refill prescriptions even if no valid prescription existed. In some instances the conspirators simply looked for a physician in the same geographic area as the customer with a similar name and filled the prescription using the physician’s DEA number without his or her knowledge. The pharmacy charged as much as ten times the usual price for the medications.
The conspirators are alleged to have engaged in a money laundering conspiracy to hide their ill-gotten gains. The destruction of evidence count alleges GALLINAL and KOGAN destroyed records after the first search warrants were served in the case in June 2012. After the execution of the search warrants, the conspirators attempted to continue the internet pharmacy scheme until the Drug Enforcement Administration ordered them to cease in August 2012. The conspirators made additional efforts to resume their online pharmacy scheme under alternative names, but refused to take any orders from or make any shipments to Washington or Oregon.
If convicted the defendants face up to 20 years in prison.
This is the first case brought in Western Washington using the Ryan Haight Act. You can learn more about the Act here.
The charges contained in the indictment are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
This was an Organized Crime and Drug Enforcement Task Force (OCDETF) investigation, providing supplemental federal funding to the federal and state agencies involved. The case was investigated by the Portland Tactical Diversion Squad which is comprised of the Drug Enforcement Administration (DEA) and the Portland Police Bureau. Substantial investigative assistance was provided by the Food and Drug and Administration (FDA) – Florida, and DEA Miami Field Division.
The case is being prosecuted by Assistant United States Attorneys Mike Lang and Francis Franze-Nakamura.