June 20, 2008

Forfeiture Order Issued in Case Linked to Steroids

By W Zachary Malinowski

Federal agents seized $2.7 million that had been paid for illegal shipments of a human growth hormone.

PROVIDENCE -- A U.S. District judge has ordered the forfeiture of $2.7 million traced to illegal shipments of HGH, human growth hormone, from an alleged steroid distribution company in China.

Federal agents seized the money last year from branches of Chinese banks in New York City after they determined that the funds had been sent to bank accounts linked to Genescience Pharmaceutical Co. as payment for illegal shipments of HGH into the United States.

Judge William E. Smith issued the forfeiture order earlier in the month.

Last September, the authorities announced the 16-count indictment against Lei Jin, founder and chief executive officer of Genescience, and three other men on federal charges of international smuggling of HGH.

Warrants remain outstanding for the arrests of Jin and two alleged distributors on multiple counts of conspiracy, smuggling and money laundering. The authorities do not believe that they are in the United States.

Last month, one of the defendants, Jeffrey Rock, of Camarillo, Calif., pleaded guilty in Providence to federal charges of smuggling, drug distribution, and money laundering. He admitted that he used Web sites and e-mail to distribute HGH that Genescience manufactured.

He is free on bail pending his sentencing, which is scheduled for Sept. 12.

On Wednesday, The New York Times reported that the licenses had been revoked for Genescience and two other drug makers, while 125 other companies had been punished. The penalties are designed to underscore an effort by the Chinese to host a performance- enhancement free Summer Olympics in Bejing.

Robert Clark Corrente, the U.S. Attorney for Rhode Island, has said that his office is spearheading the prosecution because Rhode Island was responsible for about $4 million and that 100,000 doses of steroids or HGH were seized here, along with "10 or 11 weapons."

According to an affidavit, agents based in Rhode Island reviewed more than 20,000 e-mails sent between Jin and his associates between 2003 and 2007.

At first, Jin had customers wire money to a bank account maintained in the name of Genescience. As the business expanded, he used a series of different bank accounts including Swiss Development, Quinba International and Yujun Zhao.

The illegal drugs were distributed through a worldwide Internet network.

The banks that were ordered to forfeit the money are based in China, but they maintain correspondent accounts at New York-based banks. The arrangement allows them to do business in the United States.

None of the account holders -- Genescience Pharmaceutical Co., Ltd; Swiss Development Corporation International Ltd; Quinba International Ltd; or Yujun Zhao challenged the forfeiture order. [email protected] / (401) 277-7019

Originally published by W Zachary Malinowski, Journal Staff Writer.

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