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Tuesday, November 17, 2015
Feds Indict ‘Natural’ Supplements Makers behind Hawaii Death
By News Release @ 10:47 PM :: 2707 Views :: Health Care, GMOs

Principal Deputy Assistant Attorney General Benjamin C. Mizer Delivers Remarks at Press Conference Announcing Criminal and Civil Actions Related to Unlawful Advertising and Sale of Dietary Supplements

News Release from US DoJ Washington, DC, Tuesday, November 17, 2015

Remarks as prepared for delivery

Good afternoon.

We are here today to explain critical steps the federal government is taking to stem the tide of unlawful dietary supplements being sold to consumers nationwide.

Almost every day, news sources on the Internet, television and in print feature stories about the dangers of dietary supplements:  A supplement is laced with an undeclared pharmaceutical ingredient.  A study is released about adverse health consequences of a so-called natural remedy.  An athlete or member of the military falls ill after taking an untested energy product.  These stories arise across the country all too often.

Consumers turn to supplements when they want to lose weight, get an edge in athletic performance, or improve their overall well-being.  From California to Maine, consumers ingest pills, powders and liquids every day, not knowing whether they are wasting money or whether they may end up harming, rather than helping, themselves.  Unfortunately, many of these products are not what they purport to be or cannot do what the distributors claim they can do.  In some instances, consumers might be choosing supplements over other, proven therapies for serious conditions under the mistaken belief that these products can help.

I am honored to be joined at the podium today by my colleagues from the Federal Trade Commission (FTC), the Food and Drug Administration (FDA), the U.S. Postal Inspection Service (USPIS), the Department of Defense (DoD), and the U.S. Anti-Doping Agency (USADA).  Today we are announcing a sweep of actions targeting unlawful dietary supplement makers and marketers.  Over the past year, we have pursued civil and criminal cases against more than 100 makers and marketers of dietary supplements and similar products.

A centerpiece of the sweep announced today is the indictment of USPlabs, relating to widely popular workout and weight loss supplements.  Bestselling dietary supplements, with names like Jack3d, OxyElite Pro, and OxyElite Pro “New Formula” and “Advanced Formula,” raked in hundreds of millions of dollars in sales.

As alleged in the indictment unsealed today, the defendants were on a perpetual search for the next miracle ingredient.  That search generally focused on Chinese chemical manufacturers.  When they found an ingredient that they believed was promising – and knowing full well how the market for dietary supplements operated – they doctored packaging, labeling, and other paperwork to defraud others about what the product was.  Much of the alleged fraud focused on the defendants’ claims that their products were made from natural plant extracts.  In truth, as one defendant put it, “lol stuff is completely 100 % synthethic [sic]”.

These fraudulent claims ensured that the synthetic chemicals entered the United States, got on store shelves, and were purchased by consumers.  As alleged in the indictment, the defendants falsified paperwork to stay off the radar of regulatory agencies – when the products crossed the border and as they circulated in commerce.  They made misrepresentations to convince well-known retailers, who had concerns about untested synthetic chemicals, to sell their products.  They falsified labeling and marketing materials to convince consumers, who prized natural ingredients, to buy their products.  All of these people – regulators, retailers and consumers – trusted that the defendants were telling the truth about their products.  All of these people were deceived.

This deception put lives at risk.  The indictment describes the safety testing – or, more accurately, the lack of safety testing – that the defendants undertook before hawking these factory-made stimulants.  For instance, the indictment alleges that the defendants sometimes tested the ingredients on themselves and sold the ones that made them feel good.  With one product, the defendants allegedly recognized that the substance could potentially cause “liver toxicity.”  Yet without conducting a single test to determine whether that substance was safe, they went ahead and sold it, working from the baseless assumption that they weren’t using enough of the substance in their products to cause problems.

But there were problems.  There was an outbreak of liver injuries allegedly associated with the OxyElite Pro New Formula.  Consumers experienced jaundice; several needed transplants to save their lives.  How did the defendants respond?  As the indictment alleges, they promised the FDA and the public that they would stop distributing the product at issue.  They didn’t.  Instead, they undertook a surreptitious, all-hands-on-deck effort to sell as much of the product as they could.

We are here today, in part, to take an important step in holding USPlabs accountable for its actions.  The indictment unsealed today charges USPlabs in Texas, four of its executives, and one of its consultants with a series of crimes associated with the sale of dietary supplements.  Charged with these defendants is S.K. Laboratories based in Southern California, which manufactured many of USPlabs’ products, and one of S.K. Laboratories’ executives.  As noted, this is just a step.  All of the defendants will have their day in court.  Whatever the outcome, I am confident that the dedicated men and women – from the Department of Justice and the special agents from the FDA and IRS Criminal Investigation – who have worked so hard to bring us to this point will ensure that justice is served.

The allegations against USPlabs and its operators should serve as a wake-up call to the supplement industry.  The unmistakable message is that the Department of Justice and its partners will be vigilant when it comes to the health and safety of the American public.  Fighting illegal activity in the dietary supplement industry is a high priority on our consumer protection agenda.

The USPlabs case is only one of the many cases brought as part of the sweep announced today.  Over the past year, law enforcement and regulatory officials have focused efforts on many additional products that cause high levels of concern among health officials nationwide.

Many of the cases we have brought relate to products that misrepresent the ingredients they contain.

We have also brought cases involving products that make unsupported claims about their effects.  In numerous matters, the defendants are selling products online through websites and touting their products to consumers for the cure, treatment, or prevention of diseases ranging from cancer to Alzheimer’s disease to herpes.  Making these disease cure claims defines these products as drugs under the law.  And even though they were warned by the FDA – and in some cases, through joint letters with the FTC – to stop making such claims, a number of the individuals and companies at issue continued to make these claims and promote their products as treatments or cures for diseases.  Yet these drugs lack substantial evidence of safety and effectiveness.  They are also being sold without adequate directions for their use.  Selling them in interstate commerce in these circumstances is illegal.

The government is taking a multi-faceted approach to combat the problem of unlawful dietary supplements.  In addition to criminal actions, we are using civil and administrative tools to safeguard consumers from harmful products.  As part of this sweep, the Department of Justice brought a dozen civil injunctive actions (including five in the last week) under the Food, Drug, and Cosmetic Act, and in some cases, using the civil mail fraud injunction statute, seeking to stop the defendant entities and individuals from violating the law.  In these cases we are asking the courts to order the defendants to stop their illegal conduct and to put in place processes and procedures to prevent them from violating the law in the future.  Our partner agencies, including the FTC, FDA, USPIS, DoD and USADA, are taking other measures both to enforce the law and to educate the public.

As I mentioned, I stand here in partnership with other agencies with whom we have joined forces to address this problem.  Through enforcement and education, each agency is performing its own mission to protect consumers or service members or athletes from dangerous, ineffective products.  You will hear more from my colleagues about the actions their agencies are taking.  Together, through cooperation and teamwork, we can multiply the impact of our efforts.  These actions will not put an end to this widespread problem.  But they will go some distance toward bringing change to the industry.

We are not here to criticize the entire supplement marketplace.  Not every supplement contains an undisclosed ingredient.  Not every label lies about what is contained in the bottle.  Not every claim about dietary supplements is unsupported by scientific evidence.

But consumers must be on guard before taking dietary supplements.  Oftentimes, it may be difficult or impossible to tell the conditions under which the supplements are manufactured, and it is challenging to sort through real scientific substantiation for a product as compared to unsupported hype.

How can consumers perform their own due diligence?

Talk to your health care provider.  At physical exams, ask a physician whether the bottle seen on store shelves or on the Internet could cause you harm, or whether it is worth the money you are spending to buy it.

Consult the public education materials provided by the FTC, FDA, DoD and USADA.  The FDA’s website, for example, includes tips for making informed decisions and evaluating dietary supplements, and the FTC’s website also has a wealth of information.

The Department of Defense and USADA have developed extraordinary tools, including a cell phone app, to help consumers make informed choices about supplements.

This is only the beginning.  Thanks to the partnerships we have built, our efforts in this area will continue.  We will keep investigating violators and we will use all available tools at our disposal to advance our enforcement goals and to protect consumers.

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