USA 2020 Elections: Thread

[grarpamp]

> Govt created monopolies

Anti-freemarket criminal case ends up proving US medical industry's
huge markup racket to local markets, discounts to remotes,
all while refusing to spend a dime to keep their factories tanks
free from botulism, killing babies, and FDA shutting down the works,
then getting free government defense production act subsidies and
free paid military and commercial transports and special
import duty tariff cost exemptions to fix the mess...


Baby Formula Export Scheme Worth $200 Million Lands Florida Trio In Prison

https://www.justice.gov/usao-ndfl/pr/trio-sentenced-federal-prison-conspiracy-identity-theft-and-various-fraud-charges
https://www.freightwaves.com/news/fraudsters-sentenced-to-18-years-for-200m-baby-formula-export-scheme
https://www.freightwaves.com/news/fedex-tasked-with-rushing-baby-formula-from-europe-to-pennsylvania

A Florida trio was recently sentenced to federal prison for their
roles in a $200 million baby formula fraud scheme that began some nine
years before the current critical shortages.

U.S. District Court Judge Roy K. Altman sentenced South Florida
residents Johnny Grobman, 48, Raoul Doekhie, 53, and Sherida Nabi, 57,
each to 18 years in prison on Friday. He also ordered the three to
forfeit over $200 million in fraudulently obtained profits. The three
used the profits from the baby formula sales to buy a $9 million
mansion in Florida, a 48-foot yacht, and several properties outside
the U.S.

Federal prosecutors in the U.S. District Court for the Southern
District of Florida said the trio convinced U.S. infant formula
manufacturers to sell them the products at deeply reduced prices, in
some cases receiving up to 60% discounts, by claiming they had a
government tender to purchase the formula on behalf of the
impoverished country of Suriname in South America.

Instead of shipping the formula to Suriname, the three sold the
products for full price in the U.S., raking in record profits.

Following a 13-day trial in February 2020, a federal jury found
Grobman, Doekhie and Nabi guilty of conspiring to commit wire fraud;
wire fraud; money laundering; conspiring to obtain pre-retail medical
products worth $5,000 or more by fraud or deception, theft of
pre-retail medical products; and smuggling goods from the United
States.

Two weeks after the trial ended, Grobman requested a new trial, which
Judge Altman later denied.

As of publication, attorneys for the three did not respond to
FreightWaves’ request seeking comment. Court records confirm the three
are now in custody. However, a reason was not given for why the
sentencing took place more than two years after the convictions.

The sentencing comes at a time when the U.S. is dealing with a
nationwide infant formula shortage after a massive recall at
manufacturing giant Abbott Laboratories’ Michigan plant.
How the scheme worked

According to court documents, the trio negotiated steep discounts from
the victim companies by pledging to redistribute the products in
Suriname when in fact, they intended to sell those goods in the U.S.
at a substantial markup, a business practice known as diversion.

Doekhie and Nabi, who are married, set up a company called Tropical
Marketing & Distribution N.V., based out of Suriname. The pair created
a website for a fictional entity called the Suriname Tender Office to
“support their false misrepresentation that they had a government
tender for the victim companies’ products,” according to court
records.

Grobman was listed as the manager of Nutrisource I LLC, as well as J
Trading LLC and as a registered agent of Vejota Holdings LLC. All
three companies show the same principal address in Aventura, Florida.

Court filings claim the three concealed their scheme by fabricating
purchase orders, covertly shipping the products abroad and then
immediately bringing them back, a practice known as  U-turning,
filling dummy cargo containers with sheetrock and falsifying export
documents.

Once the products returned to the U.S., court records state Grobman
would submit false shipping documents to U.S. Customs agents.

A fourth man, Edgar Torres, who received a reduced sentence of 25
months in exchange for cooperating with the government against
Doekhie, Nabi and Grobman, served as president and registered agent of
Le Mare Transport, a freight forwarding company in Medley, Florida.

During the trial, Torres testified they would swap out the cargo
containers’ baby formula with sheetrock that was the same weight as
the product they were supposed to be exporting to Suriname. They would
replace the etched cargo seals, which the infant formula manufacturers
installed to prevent tampering, using a special machine that could
carve identical markings, in a concerted effort to avoid detection by
customs officials and victim companies, court records said.

Through their companies, Grobman and Torres would sell the infant
formula to distributors in the U.S., then split the profits with
Doekhie and Nabi, court documents said.

Prosecutors claimed about 60 companies were defrauded between March
2013 and December 2018.

The scam reportedly started to unravel in 2017 after one of the
manufacturers refused to do business with the group after a truck
driver alerted the company about possible delays with their products.

“The fraud perpetrated by these defendants is nothing short of
egregious,” said U.S. Attorney Juan Antonio Gonzalez in a statement.
“The 18-year prison sentences reflect the seriousness of the
defendants’ crimes.”