Department of Justice
Eastern District of Tennessee
FOR IMMEDIATE RELEASE
Thursday, August 18, 2022
KNOXVILLE, Tenn. – On August 17, 2022, Jose Torres, 58, currently of Shelbyville, Delaware, appeared before the United States District Court for the Eastern District of Tennessee and entered a guilty plea to one count of conspiracy to engage in the unlicensed wholesale distribution of prescription drugs. Sentencing is set for March 29, 2023, at 3:00 pm, before the Honorable Thomas A. Varlan, United States District Judge.
Torres faces a term of up to five years in Federal prison, $250,000 in fines, and three years of supervised release.
As part of the written plea agreement, Torres waived indictment by a Federal Grand Jury and agreed to plead guilty to the aforementioned charge. Torres conspired and agreed with others to unlawfully purchase short-supply drugs and resell those drugs to wholesale distributors. Torres and another company entered business arrangements with retail pharmacies that were not licensed to engage in the wholesale distribution of prescription drugs. Torres used the business arrangements with retail pharmacies to purchase prescription drugs from authorized distributors. Torres then resold those drugs to wholesale distributors at a significant markup. Torres knowingly misled the authorized distributors by using the pharmacies’ accounts and credentials to purchase drugs from authorized distributors.
For example, on or about March 23, 2020, Torres purchased hydroxychloroquine sulfate tablets from a pharmacy located in the Eastern District of Tennessee, an unlicensed wholesale distributor, for $178 per unit, which was subsequently resold to a Veterans Affairs Medical Center in New York for $442 per unit by one of Torres’s wholesale distribution customers.
As part of the written plea agreement, Torres agreed to a personal money judgment in favor of the United States in the amount of $119,350, which represents the amount of proceeds Torres personally obtained from the offense described in the plea agreement.
“This plea agreement represents the commitment of the U.S. Attorney’s Office to prosecuting those who exploited the fears of others to unlawfully profit during the COVID-19 pandemic,” said U.S. Attorney Francis M. Hamilton III for the Eastern District of Tennessee.
“We continue to actively monitor the marketplace for criminal activity involving products related to COVID-19 and take action against those who put profits above public health,” said Special Agent in Charge Justin C. Fielder, FDA Office of Criminal Investigations Miami Field Office.
“Today’s guilty plea sends a clear message that criminal conspiracies aimed at enriching individuals at the expense of VA programs and services will not be tolerated,” said Special Agent in Charge Kim R. Lampkins with the Department of Veterans Affairs Office of Inspector General’s Mid-Atlantic Field Office. “The VA OIG thanks its law enforcement partners for their commitment in helping hold this defendant accountable.”
Assistant United States Attorney William A. Roach, Jr., who serves as the Office’s Coronavirus Fraud Coordinator, prosecuted the case.
This prosecution is the result of an investigation by the United States Food and Drug Administration, Office of Criminal Investigations, and the United States Department of Veterans Affairs, Office of Inspector General.
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
USAO - Tennessee, Eastern
Rachelle Barnes Public Affairs Officer (865) 545-4167