News Release
U.S. Department of Justice
United States Attorney
District of Rhode Island
September 24, 2007
Indictment charges a Chinese drug manufacturer and three others with international HGH trafficking
***
$3.4 million seized from Chinese banks in New York
A federal grand jury in Rhode Island has charged a Chinese corporation, Genescience Pharmaceutical Company, its CEO, Lei Jin, and three other men with international smuggling of Human Growth Hormone. The defendants allegedly used Internet Web sites and e-mail to facilitate the smuggling of HGH under the company’s brand name, Jintropin. The U.S. government has also seized money traced to the alleged smuggling – about $3.4 million – from New York branches of two Chinese banks.
United States Attorney Robert Clark Corrente, Terry Vermillion, Director of the FDA Office of Criminal Investigations, June W. Stansbury, Special Agent in Charge of the Drug Enforcement Administration, Joanne Yarbrough, Chief Inspector of the U.S. Postal Inspection Service, and Douglas A. Bricker, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation, jointly announced a sixteen-count indictment, which the grand jury returned on September 19 in U.S. District Court, Providence.
The indictment is part of a nationwide investigation known as Operation Raw Deal, which has focused on international smuggling of HGH and anabolic steroids, illegal distribution of the pharmaceuticals, and on home laboratories in which steroids are converted from powder into usable forms. Federal indictments and arrests throughout the country over the past several days were announced simultaneously today in Rhode Island, San Diego, Pennsylvania, New York, and elsewhere.
“Over the past two years, federal law enforcement has taken aim at a multi-headed beast,” U.S. Attorney Corrente said. “Now, thanks to hard work by agents in the field and prosecutors in the grand jury, felony charges have been brought against one of the root sources of these illegal pharmaceuticals and against individuals who allegedly distribute them.”
Charged in the federal indictment in Rhode Island, in addition to Jin and the company, are: Jeffrey Rock, of Camarillo, California, Ander Jaa, of Shanghai, China, and David Garcia, who is believed to be in Slovenia. Jin, a lawful permanent U.S. resident with an address in Madison, Wisconsin, is believed to be living in Shanghai.
A task force led by the Food and Drug Administration, Office of Criminal Investigation, conducted the investigation. The Drug Enforcement Administration, the Internal Revenue Service, Criminal Investigation, and the U.S. Postal Inspection Service participated in the task force. Immigration and Customs Enforcement provided assistance.
Conversion kits
The task force investigation has also resulted in a federal complaint in Rhode Island against Thomas Thomsen, of Tampa, Florida, charging him with selling drug paraphernalia. According to an affidavit supporting the complaint, Thomsen twice sold steroid conversion kits to a customer in Rhode Island. The kits are used to convert anabolic steroid powder into oil-based injectable forms for human use.
“The FDA Office of Criminal Investigations takes this illegal conduct very seriously and fully supports the investigation and ultimate prosecution of these profiteers who endanger the public by formulating and selling unapproved illegal drugs,” said Terry Vermillion, Director of the FDA Office of Criminal Investigations.
The indictment alleges that Jin used a Web site and e-mail to market Jintropin. It also alleges that Rock, Kane, and Jaa were distributors for GenSci, utilizing Web sites and e-mail to facilitate distribution to customers in Rhode Island, in other U.S. states, and in other countries.
Seizure at Chinese banks
Distributors and customers paid for the Jintropin with electronic money transfers. The money allegedly ended up in accounts traceable to GenSci at the Standard Chartered Bank and the Bank of China.
After task force agents traced to those accounts millions of dollars in money transfers that were allegedly payments for HGH shipments, agents seized $3,407,355 from the banks’ New York branches in April. Done with the approval of the Asset Forfeiture and Money Laundering Section of the Department of Justice, the seizure was made under a provision in the Patriot Act, and was the first use of that provision against Chinese entities.
"Neither the Internet nor international borders provide security or safety for drug traffickers,” said DEA Special Agent in Charge June Stansbury. “This group counted on the Internet to provide anonymity. It did not. They have been tracked down and face criminal charges.”
Special Agent in Charge Douglas Bricker of IRS Criminal Investigation noted the special role of Internal Revenue criminal investigators in federal counter-drug efforts: “We target the profit and financial gains of narcotics traffickers. International borders do not prevent federal law enforcement from pursuing criminals and their monetary gains and bringing them to justice.
The attack on money laundering is an essential front in the war on narcotics.”
The indictment charges Jin, the company, and Rock with conspiracy to facilitate the sale of smuggled goods. It also charges Jin and the company with six counts of smuggling goods into
the U.S., one count of distributing HGH, one count of distributing an unapproved new drug, and
five counts of money laundering. It also charges Rock with one count each of smuggling,
distributing HGH, and distributing an unapproved new drug. Jaa is charged with three counts of
smuggling goods and four counts of money laundering. Garcia is charged with two counts of smuggling and one count of money laundering.
An indictment is merely an allegation and a defendant is presumed innocent unless and until proven guilty. Upon conviction, the maximum penalty for money laundering is 20 years
imprisonment and fine of $500,000 or twice the amount of gain or loss. The maximum penalty for each of the other offenses charged in the indictment is five years imprisonment and a $250,000 fine.
Assistant U.S. Attorneys Adi Goldstein, Stephanie S. Browne, and Michael P. Iannotti prepared the case in Rhode Island for prosecution.
Contact: 401-709-5032 Thomas.connell@usdoj.gov
Click here to read U. S. Attorney Robert C. Corrente's remarks.