October 02, 2014
Contact: Public Information Officer
OCT 02 (MANHATTAN) - Preet Bharara, the United States Attorney for the Southern District of New York announced that Christina Chai, the supervising pharmacist at Stanley Pharmacy in Yonkers, New York (“Stanley Pharmacy”), and Hi Jong Lee, the owner of Stanley Pharmacy and also a pharmacist, were found guilty Monday in Manhattan federal court of conspiring to unlawfully distribute hundreds of thousands of pills of oxycodone at Stanley Pharmacy. Hi Jong Lee was also convicted of conspiring to launder the proceeds of the unlawful oxycodone distribution and structuring cash deposits to avoid the filing of currency transaction reports (“CTRs”). The defendants were convicted on all counts following a two-week trial before U.S. District Judge Paul A. Crotty and a jury. Previously, on August 20, 2014, a third defendant, Ji Yun Lee, the store manager at Stanley Pharmacy, pleaded guilty before Magistrate Judge Gabriel W. Gorenstein for his participation in the oxycodone distribution conspiracy.
Manhattan U.S. Attorney Preet Bharara said: “These three defendants turned their neighborhood pharmacy into an illegal drug spot where thousands of oxycodone pills were sold for cash to drug addicts and other drug dealers. This Office will continue to prosecute those individuals, including licensed pharmacists, who divert prescription medications for profit.”
According to the charging documents in this case and evidence presented at trial:
From in or about 2011 to in or about January 2013, Ji Yun Lee, Christina Chai and Hi Jong Lee, operating out of Stanley Pharmacy, conspired to distribute large quantities of oxycodone to various individuals – including individuals addicted to oxycodone and individuals who intended to resell the drugs – pursuant to prescriptions that the defendants knew to be stolen, tampered with, or otherwise fraudulent, and that were not issued for a legitimate medical purpose. Ji Yun Lee, the Stanley Pharmacy store manager, and not a licensed pharmacist, typically met with the oxycodone customers inside Stanley Pharmacy and delivered the filled prescriptions to them. Stanley Pharmacy charged over $1,000, in cash, for 180 30-milligram oxycodone pills, which was well in excess of the average price for a comparable quantity of lawfully prescribed oxycodone pills. Chai, the only pharmacist on duty from Monday through Friday, filled over 1,000 fraudulent oxycodone prescriptions, including prescriptions that were obviously tampered with or stolen. Hi Jong Lee, the owner of Stanley Pharmacy and its lone weekend pharmacist deposited the majority of the bulk cash proceeds from the unlawful oxycodone distribution.
During the course of the conspiracy, the defendants distributed over 200,000 oxycodone tablets – over five million milligrams of oxycodone – pursuant to fraudulent prescriptions paid for in cash. In 2012, the quantity of oxycodone purchased by Stanley Pharmacy was more than double the quantity purchased by any other pharmacy in the same zip code.
In total, Stanley Pharmacy brought in over $1.3 million in cash proceeds from the illegal sale of oxycodone. Most of the proceeds were deposited into a bank account controlled by Hi Jong Lee. Hi Jong Lee, who was responsible for the banking activities of Stanley Pharmacy, regularly deposited the cash proceeds in amounts that, alone or in combination, were just under $10,000, thereby avoiding the required filing of a CTR.
Christina Chai, 30, of Edgewater, New Jersey, was convicted of one count of conspiracy to distribute controlled substances. She faces a maximum sentence of 20 years in prison.
Hi Jong Lee, 72, of New City, New York, was convicted of one count of conspiracy to distribute controlled substances, one count of conspiracy to commit money laundering, and one count of structuring cash transactions. In connection with the structuring conviction, the jury also found that HI JONG LEE engaged in structuring while violating another law of the United States or as part of a pattern of any illegal activity involving more than $100,000 in a 12-month period. He faces a maximum sentence of 50 years in prison.
Ji Yun Lee, 45, of New City, New York, pleaded guilty to one count of conspiracy to distribute controlled substances. He faces a maximum sentence of 20 years in prison.
The potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge. Sentencing dates have not yet been set.
Mr. Bharara praised the work of the DEA’s New York City Tactical Diversion Squad, which comprises agents and officers from the DEA, New York City Police Department, Westchester County Police Department and Town of Orangetown Police Department as well as the Department of Public Safety, the New York State Insurance Bureau, the Rockland County Drug Task Force and the Internal Revenue Service who collaborated with the DEA’s Tactical Diversion Squad throughout this investigation. Mr. Bharara also thanked the Westchester County District Attorney’s Office, including members of the New York State Police, the Yonkers Police Department, and District Attorney Investigators, for their work on the investigation.The case is being handled by the Office’s Narcotics Unit. Assistant U.S. Attorneys Elisha Kobre and Daniel Tehrani are in charge of the prosecution.