LOS ANGELES– A federal grand jury has issued a superseding indictment that charges a West Los Angeles pharmacy and its owners with operating a years-long narcotic drug trafficking, money laundering, and tax fraud conspiracy.
Under the new indictment, Brentwood residents Berry Kabov, 45, and his brother Dalibor Kabov (also known as “Dabo”), 33, are charged with operating Global Compounding Pharmacy for the purpose “of concealing and growing” their conspiracy to profit from black market sales of narcotics including oxycodone (best known by the brand name OxyContin), hydromorphone (also known as Dilaudid), and hydrocodone (commonly known as Vicodin or Norco).
The prior indictment, as further detailed in a search warrant unsealed on October 1, 2015, charged the Kabov brothers with using Los Angeles as a base to sell bulk shipments of prescription drugs – including oxycodone, which is commonly sold under the brand name OxyContin – to black market customers across the country. Investigators seized parcels containing thousands of hidden oxycodone pills that the Kabov brothers attempted to ship to black market customers in and around Columbus, Ohio, according to the search warrant affidavit, which states that the customers in turn made cash deposits into Kabov-controlled bank accounts or simply shipped bulk cash to the brothers in Southern California.
The new indictment charges that, to conceal those black market drug sales, the Kabovs would use the pharmacy to “generate records” falsely showing that prescriptions “had been filled in the names of identity theft victims, that is, persons who did not in fact receive or fill” the prescriptions. Similarly, the new indictment charges that, from June 2012 through December 2014, the pharmacy ordered nearly 100,000 pills of oxycodone, yet its reported prescription records only account for half of those pills, resulting in a shortfall of more than 45,000 pills of unaccounted oxycodone, along with parallel disparities for the pharmacy's orders of other narcotic drugs.
“These defendants are charged with using their pharmacy to vastly increase the volume of their drug dealing and multiple bank accounts to hide their illicit proceeds from federal authorities,” said United States Attorney Eileen M. Decker. “Prescription drug abuse is an epidemic in this country that causes harm and in some cases death, and these defendants' use of their pharmacy in the scheme increased significantly the amount of these types of drugs on the street, posing a serious danger to the community.”
The indictment also charges the Kabovs with laundering more than $1 million in unlawful cash proceeds, which the Kabov brothers attempted to conceal in structured cash deposits into multiple bank accounts that they controlled. New tax counts added to the indictment also charge that the Kabovs falsely underreported this income to the IRS in tax years 2012 through 2014.
“Law enforcement agencies throughout the country are seizing record amounts of heroin and other opioids and first responders are witnessing the devastating effects of these substances in numbing proportions,” said DEA Special Agent in Charge John S. Comer. “DEA will continue to target the illicit trafficking organizations responsible for these detriments, but we're also committed to educating the public about the dangers of drug misuse and reducing demand – awareness is a crucial element in combatting this epidemic.”
In addition to the charges related to oxycodone and other narcotic drugs, the indictment alleges that the brothers illegally imported anabolic steroids purchased from a wholesale drug distributor located in Hubei, China. The indictment details how the brothers used the pharmacy to illegally order bulk quantities of testosterone, oxandrolone, and nandrolone.
If convicted of the charges in the indictment, Berry Kabov faces a 479-year maximum prison term and Dalibor Kabov faces a 485-year maximum prison term.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.
The investigation into the Kabov brothers and Global Compounding is being conducted by the Drug Enforcement Administration, the Internal Revenue Service – Criminal Investigation, the United States Postal Inspection Service, the Los Angeles Police Department, and the California Board of Pharmacy.
The case is being prosecuted by Assistant United States Attorneys Benjamin Barron and Ryan Weinstein of the Organized Crime Drug Enforcement Task Force.
USAO – California, Central Updated September 28, 2016
Central District of California DOJ / 16-230 / September 28, 2016