05-25-06 -- Broccoli, Gregory -- Guilty Plea -- News Release
Former Owner of N.J. Pharmaceutical Distribution Company Admits Role in Conspiracy to Sell Stolen Drugs
NEWARK – A Staten Island man pleaded guilty today to five counts of conspiracy in connection with his operation of a New Jersey-based pharmaceutical distribution company that sold stolen prescription drugs, U.S. Attorney Christopher J. Christie announced.
In entering his guilty plea before U.S. District Judge Dennis M. Cavanaugh, Gregory Broccoli, 39, admitted that from 2002 through 2004 he distributed prescription drugs through his company, Providers Plus of Jersey City and Elizabeth, knowing that the drugs had been stolen from warehouses and tractor-trailers.
Under the terms of his plea agreement, Broccoli admitted that the total value of the prescription drug transactions involved in the scheme was more than $7.3 million.
Broccoli also admitted that to sell the prescription drugs, he created fraudulent “pedigree documents,” which by federal law must accompany every sale of prescription drugs and are intended to certify the origin and sales history of shipments of prescription drugs. Broccoli also admitted that he committed tax evasion in 2003.
Judge Cavanaugh scheduled Broccoli’s sentencing for Sept. 5. On each count of conspiracy, Broccoli faces a maximum statutory prison sentence of five years and a $250,000 fine.
The government’s investigation into Broccoli’s activities began in 2003 when the FBI in Newark initiated what eventually grew into a two-year undercover investigation dubbed “Operation Pill Collector.” As part of the undercover investigation, the FBI created an undercover company that purchased prescription drugs in the secondary wholesale distribution market – the marketplace of vendors situated between pharmaceutical manufacturers and retail pharmacies.
Broccoli and his company acted as a secondary wholesale distributor.
The FBI investigation – as well as guilty pleas from defendants so far – revealed a complex but loosely organized network of thieves and crooked wholesalers who obtained prescription drugs through illegal means, created fraudulent pedigree documents, and then re-introduced the prescription drugs into the marketplace, where they were destined for retail pharmacies.
Federal agents made 14 arrests in the case on Sept. 9, 2004, and others were arrested and charged subsequently.
Among Broccoli’s admissions in court today:
• that he conspired with other secondary wholesalers to distribute the prescription drug Serostim, an HIV-AIDS drug, using fraudulent pedigree documents that Broccoli had created.
• that he conspired with two warehouse workers at a New Jersey pharmaceutical company and others to steal and then sell quantities of Imdur and Clarinex (four other people have been charged, two of whom have pleaded guilty, in connection with this conduct.)
• that he conspired with, among several others, a Georgia man in the theft and sale of the drug Verelan from a Georgia pharmaceutical company. Broccoli subsequently created fraudulent pedigree documents and sold the stolen Verelan to other wholesale distributors who conspired with him.
• that Broccoli purchased portions of a shipment of Nasonex that had been stolen by masked thieves from the trailer yard of a Newark trucking company, created fraudulent pedigree documents and sold the stolen Nasonex to other pharmaceutical wholesalers.
All of the activity he admitted occurred between January 2002 and April 2004.
Broccoli also admitted that his New Jersey business received more than $460,000 worth of gross income in 2003 and that he failed to file a personal income tax return. He admitted that he had a tax due of $134,546 for that year.
Each of the five conspiracy counts to which Broccoli pleaded guilty carries a maximum penalty of five years in prison and a $250,000 fine. The tax evasion charge carries the same maximum prison sentence and a maximum $100,000 fine.
Pleading guilty as a result of the investigation to date are:
Daniel Guarino, of Belleville, Conspiracy to Transport Stolen Prescription Drugs from Georgia to New Jersey
Anthony Pietoso, of Nutley, Conspiracy to Transport Stolen Prescription Drugs from Georgia to New Jersey, and Conspiracy to Steal Prescription Drugs from a New Jersey Pharmaceutical Warehouse
Richard Devivo, of Harrison, Conspiracy to Transport Stolen Prescription Drugs from Georgia to New Jersey, and Conspiracy to Steal Prescription Drugs from a New Jersey Pharmaceutical Warehouse
Alain Montes, of Ridgefield Borough, Conspiracy to Engage in Unlicensed Wholesaling of Prescription Drugs
Fernando Dovale, of Ridgefield Borough, Conspiracy to Engage in Unlicensed Wholesaling of Prescription Drugs
Michael Senatore, of Lake Ariel, Pennsylvania, Unlicensed Wholesaling of Prescription Drugs
Anthony Senatore, of Lake Ariel, Pennsylvania, Unlicensed Wholesaling of Prescription Drugs
Christie credited Special Agents from the Federal Bureau of Investigation, under the direction of Special Agent in Charge Leslie G. Wiser Jr.; the Food and Drug Administration’s Office of Criminal Investigations, under the direction of Special Agent in Charge George Hemmer; and Special Agents from the Internal Revenue Service, Criminal Investigation Division, under the direction of Special Agent in Charge Patricia J. Haynes, with developing the case against the defendant. The government is represented by Assistant U.S. Attorney Kevin G. Walsh of the Commercial Crimes Unit in Newark.
-end-
Defense counsel:
A. Ross Pearlson, Esq., Newark