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HSI San Diego, multiagency investigation results in business owner’s guilty plea for illegal importation and money laundering

Money LaunderingHSI San Diego, multiagency investigation results in business owner’s guilty plea for illegal importation and money laundering

SAN DIEGO – Nine2Five LLC and its owner, Sebastian Guthery, pleaded guilty in federal court on July 10 to felony crimes related to the illegal importation of kratom, an opioid-like plant, and the subsequent laundering of proceeds from the sale of the illegally imported product. Homeland Security Investigations, IRS Criminal Investigation Division and U.S. Customs and Border Protection investigated this case.

“HSI San Diego is deeply immersed in the global fight against illegal importation and money laundering,” said Special Agent in Charge for HSI San Diego Chad Plantz.

“Attempting to smuggle even more harmful substances into our communities will not be tolerated. Further, deceiving law enforcement is illegal and by doing so only increases the severity of penalties. HSI is actively engaged with law enforcement partners and task forces to bring perpetrators who knowingly and willingly break the law to justice.”

Kratom is indigenous to Southeast Asia. Its leaves, when ingested, have both narcotic and stimulant-like effects. According to the U.S. Food and Drug Administration, the use of kratom is associated with serious health risks, including but not limited to seizures, liver damage, addiction, and death. Side effects may also include respiratory depression, nervousness, agitation, aggression, sleeplessness, hallucinations, delusion, tremors, loss of libido, constipation, nausea, vomiting, and severe withdrawal signs and symptoms.

On Feb. 28, 2014, the FDA issued Import Alert 54-15, directing inspectors to detain products that appeared to contain kratom as well as named product from specified firms without inspection and to deny them entry into the United States. This Import Alert remains in effect.

In pleading guilty, defendant Guthery admitted to the importation of 9,800 kilograms of kratom from Indonesia through a consignee by means of an invoice which falsely declared the product to be Flora Food Botanical Soil Conditioner (Eucheuma spinosum)/fertilizer without reasonable cause to believe that was true. The invoice submitted with the entry package stated that the value of the goods was $61,728.

Defendant Nine2Five, LLC, in pleading guilty to money laundering, admitted wiring $60,000 from an account at Wells Fargo Bank in San Diego to Bank Mandiri in Indonesia for the cost of the purchase, transportation and importation of kratom from Indonesia. The funds constituted criminally derived proceeds of the illegal importation of kratom in the manner acknowledged by Guthery in his plea.

“Making false declarations about the nature of products imported into the United States will not be tolerated,” said U.S. Attorney Randy Grossman. “The Department of Justice and our agency partners are committed to protecting our nation from importation crimes and related offenses.” Grossman thanked the prosecution team plus the IRS, HSI, and CBP agents for their excellent work on this case.

“Sebastian Guthery and Nine2Five LLC went unchecked by mislabeling imports of kratom to evade detection and inspection by U.S. authorities and laundering the criminally derived proceeds internationally to purchase more kratom. The import laws and regulations are in place to protect our citizens and our nation,” said Special Agent in Charge of IRS Criminal Investigation Los Angeles Field Office Tyler Hatcher. “This should put the kratom industry on notice, illegally importing products into the United States for your own financial gain is a crime and disregarding U.S. import laws and import alerts will not go unnoticed, you will be held accountable.”

The defendants in this case are innocent until proven guilty in a court of law.

Sentencing for both defendants is scheduled to take place on Oct. 6, 2023, at 9:30 a.m. before U.S. District Judge Todd W. Robinson.

HSI is the principal investigative arm of the U.S. Department of Homeland Security (DHS), responsible for investigating transnational crime and threats, specifically those criminal organizations that exploit the global infrastructure through which international trade, travel, and finance move. HSI’s workforce of more than 8,700 employees consists of more than 6,000 special agents assigned to 237 cities throughout the United States, and 93 overseas locations in 56 countries. HIS’s international presence represents DHS’ largest investigative law enforcement presence abroad and one of the largest international footprints in U.S. law enforcement.

Story from www.ice.gov

Disclaimer: The views expressed in this article are independent views solely of the author(s) expressed in their private capacity.

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