A federal district judge in Miami sentenced three people from South Florida to 220 months, or 18 years, in prison on May 20 after they were found guilty of running a fraud scheme involving baby formula.
Johnny Grobman, 48, Raoul Doekhie, 53, and Sherida Nabi, 57, "cheated U.S. manufacturers of infant formula, eye-care products, and other FDA-regulated items out of more than $100 million," according to the U.S. Attorney's Office for the Southern District of Florida.
The three people ran the scheme from 2013 to 2018, and lied to U.S. manufacturers in order to get discounts for the baby formula and other products.
Doekhie and Nabi, who are married, said they were buying the products and shipping them to Suriname, usually "in connection with purported government procurement contracts they held in Suriname."
However, they did not have the contracts, nor did they ever ship products to Suriname. Instead, Grobman and others involved sold all of the products throughout the United States, and would then split the millions of dollars they made.
The three people had three methods of hiding their illegal fraud scheme from the U.S. manufacturers. They sent fake, "dummy," shipments containing something else, but were able to provide documentation that the shipment was exported. The second method was to "U-turn" the products -- shipping them overseas, obtaining documentation, and then having them shipped back to the U.S.
The third method was simply creating fake export shipping documentation that would make it appear the products were sent, but never actually left the country.
"Following a 13-day trial, on February 6, 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," the Southern District of Florida said in the statement.
"On April 25, 2022, the Court entered forfeiture money judgments for the amounts of the criminal proceeds traceable to the offenses of conviction as follows: $87,187,374.83 against Grobman and $115,699,273.61 jointly against the Defendants Doekhie and Nabi."
This was not the first time that the South Florida U.S. Attorney’s Office and FDA-OCI has dealt with a large-scale fraud scheme. In 2019, they convicted five people for various crimes in relation to a global fraud scheme. This time, the people were lying about the U.S. military and the Government of Afghanistan.
The sentences for the baby formula schemers were announced after U.S. District Judge Roy K. Altman imposed them on May 19.
"The fraud perpetrated by these defendants is nothing short of egregious," Juan Antonio Gonzalez, U.S. Attorney for the Southern District of Florida, said "The 18-year prison sentences reflect the seriousness of the defendants' crimes. Our Office will continue to vigorously prosecute those who commit these types of offenses."
"Today’s announcement should serve as a reminder that those who fraudulently divert consumer products for profit will be held accountable for their actions,” Special Agent in Charge Justin C. Fielder, FDA Office of Criminal Investigations Miami Field Office, said. "We will continue to investigate and bring to justice those who engage in fraudulent schemes involving FDA-regulated products."
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