January 23, 2020
Contact: Erin Mulvey
Phone Number: (212) 337-2906
Queens pharmacist indicted for illegal distribution of oxycodone and filing false tax returns
BROOKLYN, N.Y. – A 12-count indictment was unsealed today in federal court in Brooklyn charging Daniel E. Russo, a pharmacist, with conspiracy to distribute and possess with intent to distribute oxycodone, distribution and possession of oxycodone, distribution of oxycodone by a pharmacist without legitimate prescription and filing false tax returns. Russo was arrested this morning by federal agents and arraigned this afternoon before United States Magistrate Judge Cheryl L. Pollak. The defendant was released on a $1.5 million bond.
DEA New York Division Special Agent in Charge Ray Donovan, United States Attorney for the Eastern District of New York Richard P. Donoghue, Acting Deputy Assistant Attorney General of the Justice Department’s Tax Division Stuart M. Goldberg and Internal Revenue Service Criminal Investigation Special Agent-in-Charge Jonathan D. Larsen announced the charges.
As set forth in the indictment and other court documents, Russo owns and operates Russo’s Pharmacy in Far Rockaway, Queens. Between March 2011 and June 2014, Russo allegedly conspired with others, including medical professionals and employees of a physician, to fill fraudulent prescriptions for oxycodone and dispense thousands of oxycodone pills in return for hundreds of thousands of dollars in cash. Russo then filed false corporate income tax returns for his pharmacy for the years 2013 through 2016, omitting the proceeds of his scheme, and false individual income tax returns for the years 2012 through 2016. In total, Russo is charged with failing to report over $1 million in cash earnings, most of it generated from his oxycodone distribution scheme.
More than a dozen physicians for whom Russo filled prescriptions have since been convicted of crimes related to the distribution of oxycodone.
“It is a misconception that pharmacists can hide their role in illegal drug distribution by blindly following what doctors have prescribed for their patients,” said Special Agent in Charge Donovan. “By law, pharmacists must practice due diligence, and take their corresponding responsibility seriously. If diversion of prescriptions is suspected, and merely cast aside to make a quick dollar, the pharmacist is no better than a dealer on the street. Today’s arrest reemphasizes law enforcement’s commitment to identifying and arresting all of those responsible for furthering drug abuse and overdose deaths throughout our hometowns.”
“We can count the hundreds of thousands of dollars Russo allegedly pocketed from the charged scheme, but the resulting human misery in our communities is incalculable,” said United States Attorney Donoghue. “This Office will continue working with federal and local law enforcement partners to investigate and prosecute medical professionals who seek to profit from the opioid epidemic.”
“Income earned from the sale of prescription drugs is taxable regardless if those sales are legal or illegal,” said Special Agent-in-Charge Larsen. “Mr. Russo allegedly failed to report the illegal income on his corporate tax returns in conjunction with concealing how the income was derived.”
If convicted of the drug charges, Russo faces up to 20 years’ imprisonment. If convicted of the tax charges, he faces up to three years’ imprisonment for each count.
The charges in the indictment are allegations, and the defendant is presumed innocent unless and until proven guilty.
The government’s investigation was led by the DEA’s Long Island Tactical Diversion Squad, comprising agents and officers of the DEA, Nassau County Police Department, Suffolk County Police Department, Port Washington Police Department and Rockville Centre Police Department. The DEA Tactical Diversion Squad also worked in conjunction with officers and agents of the U.S. Internal Revenue Service Criminal Division, U.S. Department of Health & Human Services’ Office of the Inspector General and New York City Department of Investigation.
This case is the latest in a series of federal prosecutions by the United States Attorney’s Office for the Eastern District of New York as part of the Prescription Drug Initiative. In January 2012, this Office and the DEA, in conjunction with the five district attorneys in this district, the Nassau and Suffolk County Police Departments, the New York City Police Department, the New York State Police and other key federal, state and local government partners launched the initiative to mount a comprehensive response to what the United States Department of Health and Human Services Center for Disease Control and Preventions called an epidemic increase in the abuse of so-called opioid analgesics. To date, the initiative has brought over 160 federal and local criminal prosecutions including the prosecution of 20 health care professionals; taken civil enforcement actions against a hospital, a pharmacy and pharmacy chain; removed prescription authority from numerous rogue doctors and expanded information-sharing among enforcement agencies to better target and pursue drug traffickers. The initiative also is involved in an extensive community outreach program to address the abuse of pharmaceuticals.
The government’s case is being prosecuted by Assistant United States Attorney Nomi D. Berenson and Trial Attorney Michael C. Vasiliadis of the Tax Division.
DANIEL E. RUSSO
Cedarhurst, New York
E.D.N.Y. Docket No. 20-CR-23 (DLI)
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