“What a tangled web (drug dealers) weave, when at first we practice to deceive.”
–Sir Walter Scott
This story has been updated. Please click here to find it.
On September 4, the federal government handed down a 16-count indictment charging 9 individuals and the company, Curious Goods, with conspiracy to distribute synthetic drugs, conspiracy to introduce misbranded drugs into interstate commerce, conspiracy to commit money laundering, and various money laundering charges, involving more than $10,000,000.
Named in the indictment as defendants along with Curious Goods LLC are Alexander Derrick Reece, 40 of Gainesville, Fla.; Drew T. Green, 38 of Roswell, Ga.; Thomas William Malone, Jr., 45 of Roswell, Ga.; Boyd Anthony Barrow, 43 of Canton, Ga.; Joshua Espinoza, 49 of Marietta, Ga.; Richard Joseph Buswell, 44 of Lafayette, La.; Daniel James Stanford, 54 of Lafayette, La.; Daniel Paul Francis, 42 of Dawsonville, Ga.; and Barry L. Domingue, 52 of Carencro, La.
This story has all the usual suspects; lawyers, retailers, distributors and manufacturers, some of which are defending themselves against other legal accusations. We know of at least one death, Dakota Dyer, that is allegedly a result of ingesting “Mr. Miyagi”, the particular brand of synthetic marijuana that is involved in this indictment.
One of those who were indicted, Drew Green, who owns and operates Nutragenomics, is responsible for supplying the synthetic cannabinoids used to produce this particular “brand” of drug. Green claims to be a master formulator in the health and nutrition field. Mr. Green is quite the character. Expect to hear much more about him on the blog soon. He is the subject of our next Portrait of a Predator. And, we believe you that you will find this article the most sensational in our Predator series. Make sure that you don’t read it on a full stomach!
In a previous case, West Virginia won an injunction against Nutragenomics banning them from doing business in their state, as a matter of public safety. A week later, as a part of Operation Log Jam, the state of Georgia raided the company and identified it as the fifth largest synthetic drug chemical supplier in the country.
In response to the many legal challenges that afflict the synthetic drug industry, several law firms and trade associations have offered drug dealers legal advise regarding how to skirt the law in response to DEA, FDA, State, and Local bans on synthetic drugs.
The law firms usually find a swift business in “counseling” clients about what is legal according to the latest laws regarding synthetic drugs. This type of advise is acceptable and ‘above the law.’ However, advising clients how to avoid prosecution of future illegal
activities may be beyond the permitted scope of counsel, as we are discovering in an indictment brought against attorneys Daniel Stanford and Barry Domingue. The indictment says Stanford trained, advised and instructed the workers and owner of the Curios Goods shop on how to store, display and sell synthetic drugs. They also educated them on how to detect and evade law enforcement. Hmmmm! Sounds more like the consertieri for a mafia family.
And, when you accept extraordinarily large amounts of money for helping people avoid future illegal acts and become intimately involved in the operations of these businesses, it can land you in the clinger.
Stanford and Domingue are also accused of money laundering.
In the last few years, several “trade associations” have surfaced which advocate for and advise the synthetic drug industry. There is much speculation about the legitimacy of several of these associations after reports that some the officers of these organizations are profitting from the sale of synthetic drugs. The To the Maximus Foundation recently wrote an article about another character, Rick Broider, who is President of a synthetic drug trade association, North American Herbal Incense Trade Association and owner of Liberty Herbal Incense, which sells fake pot.
According to the indictment, Stanford and Domingue, received huge payouts from synthetic drug manufacturers and retailers through the Retail Compliance Association (RCA). According to the RCA website:
The RCA’s purpose is to protect the interest of small business from illegal search and seizure, profiling, harassment and other forms of government intimidation. We welcome all who visit us to leave their comments, suggestions, horror stories and accolades. Please visit our blog and Tell Us What’s Happening in your neck of the woods. Portions of this site are free to public viewing, while the exclusive content is for paying web members only – designated by (M). Join today and let us help you.
It was a pretty good racket. For a $400 “membership fee, Stanford and president Daniel Francis would provide this advise. Stanford was listed as Director and Frances was the President. Their website lists their services, which basically involved helping people break the law without getting caught. In their own words, “RCA was formed to help retailers stay ahead of the law.” Well, they didn’t do a very good job.
For good laughs, read this press release by RCA in June. It’s amazing that this Francis character got as far as he did. After you read the press release, you may understand why.
According to federal indictments, Lawyers Stanford and Domingue and RCA President Daniel Francis held workshops with Curious Goods owners, including their employees, who sold a product known as “Mr. Miyagi.” Apparently the workshops included “how to store, display and sell the ‘Mr. Miyagi’ products, on how to detect and evade law enforcement, and how to respond to customers who asked questions about how to use the ‘Mr. Miyagi’ products and/or the physiological effects of the ‘Mr. Miyagi’ products” in exchange for a large fee based on each store’s volume of sales.
The Owner of Curious Goods, Richard Buswell, was already facing federal criminal charges related to his role in an investor fraud scheme. Buswell has pleaded not guilty to those charges and is awaiting trial. The investigation and indictment of this case were part of Operation Log Jam, a nationwide synthetic drug takedown that occurred on July 25, 2012. Brands such as “Spice,” “K2,” “Blaze,” “Mr. Miyagi,” and “Red X Dawn” are labeled as incense or potpourri to mask their intended purpose.
Special Agent in Charge of U.S. Drug Enforcement Administration, New Orleans Division, Jimmy S. Fox, III, stated, “Today’s federal indictments of Curious Goods LLC and their criminal associates represent the sole basis for Operation Log Jam and DEA’s fight to stem the tide of synthetic drugs in this country. Anecdotally, anytime users put uncontrolled or unregulated drugs, or drugs with unknown effects, into their bodies, they are playing Russian roulette – there is simply no way to know with any accuracy what the potentially harmful effects in both the short and long term will be. This case should give those who choose to traffic synthetic drugs pause because they could be next.”
It’s a pretty convoluted relationship over all. Here is a graphic we hope explains what the indictment says:
Of course that isn’t all there is to this story. If you think that this little group is interesting, keep posted to the blog. We have a story brewing that involves a few of these characters which puts this story to shame. Stay tuned in the next few weeks.
In addition to the intriguing connections between the players, we believe the federal indictment hints at some very important aspects of this case:
- The case will be a test of the Federal Analogue Act. Apparently, according to the indictment, tested samples of Mr. Miyagi and other products seized in a raid on July 25, 2012, as a part of Operation Log Jam, has shown the product contained the following compounds: AM-2201, JWH-081, JWH-250, and UR-144. The alleged crimes were committed before the Synthetic Drug Abuse Prevention Act of 2012, which went into effect on July 9, 2012, and included those specific chemical compounds. The indictment alleges that the compounds are an analogue of those compounds that were included in a DEA temporary Scheduling of 5 synthetic compounds on March 1, 2011.
- This case will help define the role of so-called “Trade Associations.” Are these organizations simply a crime syndicate with the patina of legality, or are they legitimate advocacy organizations? Where did RCA cross the line? Did they cross the line?
- This case may provide a template for synthetic drug prosecution. There is no question that this case will be important in case-law regarding synthetic drugs. The US Government will undoubtedly proceed carefully in order to insure that future cases can also be successfully prosecuted.
Our hope is that the indictments in this case become convictions, and we hope that these indictments serve as a warning to other lawyers, like Spencer Siegel and Thomas Wright who run a firm specifically directed toward sellers of synthetic drugs, and “trade association” groups like North American Herbal Incense Trade Association (NAHITA) run by the infamous Rick Broider.
Most of the men indicted are not strangers to the justice system.
Espinoza and Borrow were also arrested in on February 1 on theft of services charges.
Reece was arrested on July 25 (the day that authorities set off Operation Log Jam) for driving with a suspended or revoked license.
In August 2011, Buswell was charged in a 28-count indictment that included charges of conspirancy, securities freud, wire freid, mail fraud and investment adviser fraud, cheating over 100 investors of 8 million dollars.
At the time of this indictment, Buswell was already facing federal criminal charges related to his role in an investor fraud scheme. Mr. Buswell has pleaded not guilty to those charges and is awaiting trial. The investigation and indictment of this case were part of Operation Log Jam, a nationwide synthetic drug takedown that occurred on July 25, 2012. Brands such as “Spice,” “K2,” “Blaze,” “Mr. Miyagi,” and “Red X Dawn” are labeled as incense or potpourri to mask their intended purpose.
Buswell, who was a licensed stockbroker in Lafayette, Louisiana, solicited investments in Bowman Investment Group in order to generate commissions and wages for himself.
The indictment alleged that Fouke, a former general contractor, recruited investors from his circle of acquaintances. Then, once investors had handed over their funds, Buswell allegedly engaged in “churning” and unauthorized trading to generate large commissions.
Buswell was arraigned Oct. 14, 2011 and released pending trial under a $100,000 unsecured bond with various conditions of pretrial release.
On Dec. 8, Buswell was arrested by the Lafayette Metro Narcotics Task Force on a count of possession with intent to distribute Schedule I narcotics. The task force said Buswell was one of the owners of Curious Goods, a tobacco shop with several local locations.
After that arrest, the U.S. Attorney’s Office filed a petition seeking to revoke Buswell’s release.
In a subsequent hearing, the prosecution presented evidence related to the drug charges and evidence concerning a criminal complaint and civil suit for damages Buswell filed against potential prosecution witnesses in the federal securities and wire freud case.
Assistant U.S. Attorney Kelly Uebinger said in an email to Capital City Press that Buswell filed the suit in an attempt to intimidate witnesses in the federal case.
U.S. Magistrate Judge Patrick J. Hanna ruled the civil lawsuit Buswell filed contained false allegations against two victims and material witnesses for the prosecution.
In April of 2012, the Financial Industry Regulatory Authority, Inc. (FINRA) issued a release advising that stockbroker Richard Joseph Buswell was barred from association with any FINRA member in any capacity. The sanctions were based on findings that Buswell and another stockbroker made numerous misrepresentations and omissions of material fact to customers who purchased unsecured bridge notes, warrants and unsecured promissory notes issued by a company that failed to repay holders of these units, failed to exchange their warrants for common stock and filed for Chapter 11 bankruptcy protection.
Stanford served as Buswell’s attorney in that case. But, Stanford found himself in his own trouble back in 2010.
Stanford was suspended from the practice of law in the state of Louisiana for six months in October of 2010 after he was found to intentionally mislead a sixteen year old into agreeing not to testify against her father by “causing (her) to become fearful and unwilling to cooperate with (her father’s) prosecution, after her father was charged with raping her.”
Stanford was co-counsel for a criminal defendant charged in Lafayette Parish with two counts of aggravated rape, in which one of the victims was the defendant’s sixteen-year old daughter. Initially, the victim had always cooperated with the prosecutor in handling the case; however, days before the trial, the victim met her father at respondents’ office and her willingness to cooperate changed. At that time, Mr. Stockstill drafted and presented the victim with the following three documents: 1) an affidavit stating that it was the victim’s desire to “talk about [the] situation” in an effort to “reconcile;” 2) an affidavit that the victim wanted to dismiss the charges against the defendant; and 3) a confidentiality agreement, which stated that all statements made during the meeting were “privileged,” made “without prejudice to any party’s legal position,” and were “non-discoverable and inadmissible for any purpose in any legal proceeding.” The agreement also provided that neither the victim nor the defendant could “be compelled to disclose or to testify in any proceedings as to information disclosed” at the meeting.
Finally, the agreement stipulated that an injunction could be obtained to prevent disclosure of any confidential information in violation of the confidentiality agreement, and that breach of the agreement would expose the breaching party to liability for “costs, expenses, liabilities and fees, including attorney’s fees, that may be incurred as a result of such breach.”
The Court also found that Mr. Stanford intended to prevent the victim from disclosing the facts of the meeting or its contents to the state.
Frances had a relatively minor scrape with the law a few years ago. He was arrested for DUI in Dawsonville, Georgia on 6/11/09.
The 16-count indictment charges nine individuals and the company Curious Goods with conspiracy to distribute synthetic drugs, conspiracy to introduce misbranded drugs into interstate commerce, conspiracy to commit money laundering, and various money laundering charges. The drugs are often marketed as bath salts, Spice, incense, potpourri or plant food.
Also named in the indictment are Alexander Derrick Reece, 40, of Gainesville, Fla.; Drew T. Green, 38, of Roswell, Ga.; Thomas William Malone, Jr., 45, of Roswell, Ga.; Boyd Anthony Barrow, 43 of Canton, Ga.; Joshua Espinoza, 49, of Marietta, Ga.; Richard Joseph Buswell, 44, of Lafayette; and Daniel Paul Francis, 42, of Dawsonville, Ga.
Domingue did not immediately return a phone call seeking comment for this story.
At the time of the the Sept. 4 drug indictment, Buswell was already facing federal criminal charges related to his role in an investor fraud scheme involving his former company, Bowman Investment Group. Buswell has pleaded not guilty to those charges and is awaiting trial. Stanford, who says his involvement in this case began with his representation of Buswell in the securities fraud matter, released the following statement to IND Monthly:
“I did nothing illegal or wrong and at all times represented my client effectively as a criminal defense lawyer.
It takes a certain amount of courage to be an effective criminal defense lawyer. A lawyer cannot do his client justice as a federal criminal defense advocate if he is afraid of the government.
To function as an effective criminal defense lawyer, the lawyer has to be willing to litigate government efforts to restrain his client’s liberty and assets, and he has to be willing to have his own conduct scrutinized by an adversary capable of ruining his career or his life.
In this case, the government is prosecuting me and attempting to ruin my career and my life because I effectively represented my client and sought justice as his lawyer and advocate.
This is simply a case of the government alleging guilt through the representation of my client.”
The indictment alleges that Curious Goods, a company based in Lafayette and controlled
by Buswell, sold a product called “Mr. Miyagi” that was infused with synthetic cannabinoids. Although mislabeled as a potpourri, “Mr. Miyagi” was sold to be smoked for the sole purpose of getting the consumer of the product “high,” according to the indictment. The synthetic cannabinoids infused into “Mr. Miyagi” are considered Schedule I controlled dangerous substances under federal law. According to the feds, in 2010 poison centers nationwide responded to about 3,200 calls related to synthetic “Spice” and “bath salts.” In 2011, that number jumped to more than 13,000 calls. Sixty percent of the cases involved patients 25 and younger.
The local business was very lucrative, the feds say: From March 1, 2011 to December 31, 2011, Curious Goods stores throughout Acadiana had sales of “Mr. Miyagi” totaling $5 million.
The indictment states that Pinnacle Products/Pinnacle Products Group based in Marietta, Ga., manufactured “Mr. Miyagi” and supplied the product to Curious Goods. Pinnacle Products was controlled and operated by Boyd Anthony Barrow and Joshua Espinoza. Pinnacle obtained the synthetic cannabinoids for “Mr. Miyagi” from NutraGenomics, an Alpahretta, Ga., based company controlled by Drew T. Green and Thomas William Malone Jr. NutraGenomics distributed synthetic cannabinoids throughout the U.S., according to the indictment, and the majority of the synthetic cannabinoids distributed by NutraGenomics was supplied by Alexander Derrick Reece through the companies Mountain Industry and Blue Sky International Broker.
The feds say Stanford received checks totaling $156,921 from Pinnacle Products and Curious Goods. They allege that at a meeting held at Buswell’s house on or about Dec. 7, 2011, Stanford trained, advised and instructed franchise owners at Curious Goods stores and their employees on “how to detect and evade law enforcement, and how to respond to customers who asked questions about how to the use the ‘Mr. Miyagi’ products and/or the physiological effects of the ‘Mr. Miyagi’ products.” A day after the meeting, on or about Dec. 8, 2011, an unindicted coconspirator gave Stanford $80,000 in cash, according to the indictment.
The feds have moved to seize more than $20 million in cash the defendants received either directly or indirectly from the drug trafficking ring, a 2006 Mercedes Benz X65 sedan, a 2005 Baja Outlaw speed boat, and 2002 Pontiac Firebird (the owners were not listed), and Stanford’s home at 120 Branton Drive in Lafayette. According to the tax assessor’s office, the home is valued at $572,000.
This indictment follows an investigation conducted jointly by the U.S. Drug Enforcement Administration, the Federal Bureau of Investigation, U.S. Homeland Security Investigations, the Internal Revenue Service’s Criminal Investigations division, Food and Drug Administration’s Office of Criminal Investigations, Lafayette Metro Narcotics, Louisiana State Police, Georgia Bureau of Investigation, Gulf Coast High Intensity Drug Trafficking Areas, and the 15th Judicial District Attorney’s Office.
The indictment is part of “Operation Log Jam,” a nationwide synthetic drug takedown that occurred July 25, 2012. During the takedown, more than 90 people were arrested and more than 5 million packets of designer synthetic drugs seized in the first-ever nationwide law enforcement action against the synthetic designer drug industry responsible for distributing drugs often marketed for other purposes, such as bath salts.
The feds say the popular, smokable designer drugs are marketed as “legal” and easily available. They provide a marijuana-like high that in many cases is far more intense with dangerous side effects comparable to amphetamine abuse. These smokable designer drugs are marketed as “Spice,” “K2,” “Blaze,” “Mr. Miyagi” and “Red X Dawn” and often labeled as incense or potpourri.
Attorney Bill Goode, who leases office space to Stanford in his downtown building, says the feds will have a tough time making a case against Stanford. “I’ve known him for 10 years, and if I got into any kind of trouble, I’d hire him in a heartbeat,” Goode says. “They’re indicting him for giving legal advice to his clients, and that’s just wrong. I think it’s just nonsense.”
Goode, himself a criminal defense attorney, also believes the new laws prosecutors are using in the conspiracy case as a whole are vague and ambiguous. “There is a question of whether this is a banned substance,” he says.