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Charges brought in dietary supplement fraud case

Charges brought in dietary supplement fraud case
Posted at 3:13 PM, Nov 17, 2015
and last updated 2015-11-17 18:13:55-05

WASHINGTON (AP) — A Dallas company that had been ordered to recall a dietary supplement pill because of links to liver damage has been indicted along with several of its executives on charges that they intentionally misbranded their products and deceived consumers, the Justice Department announced Tuesday.

The indictment accuses USPlabs LLC of importing chemicals from China and then lying about the nature and source of those ingredients through misleading marketing labels, part of a pattern of deception that prosecutors say was designed to put products on store shelves regardless of safety risk and to satisfy consumer demand for its lucrative business.

"They falsified labeling and marketing materials to convince consumers, who prized natural ingredients, to buy their products," said Principal Deputy Assistant Attorney General Benjamin Mizer, head of the Justice Department's civil division. "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."

The allegations cover the company's past troubles with the Food and Drug Administration, which in 2013 directed the firm to cease production of a weight loss and muscle-building supplement after the product was linked to liver damage and several users needed liver damage to save their lives. The company promised the FDA that it would stop distributing the supplement, known as OxyElite Pro, but instead engaged in a "surreptitious, all-hands-on-deck effort to sell as much OxyElite Pro as it could as quickly as possible," according to the Justice Department.

The indictment also charges four company executives and a consultant as well as S.K. Laboratories, Inc., an Anaheim, California firm that prosecutors say was responsible for manufacturing many products for USPlabs, and one of its executives.

Four of the six individuals who were charged were arrested Tuesday, and the two others were expected to turn themselves in.

Online court records didn't list attorneys for any of the defendants. Publicly listed phone numbers for the indicted individuals could not immediately be located.

The indictment was announced as part of a yearlong nationwide sweep against makers and marketers of dietary supplements that the Justice Department said has resulted in criminal or civil cases against 117 people and entities.

The multi-billion-dollar dietary supplement industry in recent years has come under scrutiny from lawmakers and regulators, who have expressed concerned that companies are skirting rules meant to stop them from marketing their products for specific diseases and conditions.

In June, for instance, Sen. Claire McCaskill of Missouri sent a letter to more than a dozen companies asking executives to explain how they vet dietary supplements and weed out products making false claims.

Mizer, of the Justice Department, said that while "not every label lies about what is contained in the bottle," consumers nonetheless need to be careful about what products they use.