NARCOTICS

03/13/2015

Chinese chemical supplier pleads guilty in synthetic drug case

JACKSONVILLE, Fla. — A Chinese man pleaded guilty Tuesday to conspiracy to import controlled substance analogues (synthetic cannabinoids), knowing they were intended for human consumption.

Wei Zhang, aka David Liteng, 35, of Tianjin, China, also pleaded guilty to two counts of aiding and abetting the importation of controlled substances and cathinones, also known as “bath salts.” He faces a maximum penalty of 60 years in federal prison.

The investigation leading to the plea was conducted by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the Jacksonville Sheriff’s Office, and the North Florida High Intensity Drug Trafficking Area Task Force, as part of the Special Operations Division Project Synergy.

“This prosecution is another example of HSI’s continued efforts, with our state, local and federal law enforcement partners, in combating the illegal importation and distribution of these dangerous substances,” said Susan L. McCormick, special agent in charge of HSI Tampa. “The criminal organizations that profit from the sale of these poisons specifically package them to appeal to the younger members of our communities. It is our responsibility as law enforcement officials to do all we can to protect our young people from the dangers posed by the introduction of synthetic narcotics into our neighborhoods.”

According to the plea agreement, in late 2010, an individual met with Dan and Kevin Louie, the owners and operators of Source1Herbs, in Toronto, Canada. Source1Herbs was a large wholesale business that sold synthetic cannabinoids and cathinones. This individual met with the owners and learned that their Chinese-based supplier was Zhang. In October 2010, the individual made contact with Zhang and discussed ordering chemicals from him directly. In February 2011, the individual and his business partner traveled to China and met with suppliers, including Zhang. During these meetings, the individual and Zhang discussed finding a replacement chemical for (1-napthoyl)indole (JWH-018), which was set to be temporarily listed as a Schedule I controlled substance by the Drug Enforcement Administration (DEA). As a result of the meeting, the individual obtained a more favorable pricing from Zhang for synthetic chemicals. Zhang, having a significant chemistry background, explained the best chemical alternatives for JWH-018 that would give the end user a similar high, including stimulant and hallucinogenic effects.

On March 1, 2011, Zhang and others exchanged email communications (including news articles) for specific chemicals banned that day, which included JWH-018. One such email from Zhang states, “Hi we know there will be ban jwh and similar product on 1th (sic) march. Pls let me know what happen tomorrow.” When JWH-018 was placed on the DEA’s banned list, Zhang and others began selling other chemicals, including AM-2201, JWH-081, JWH-122, JWH-203, JWH-210 and JWH-250. Zhang routinely shipped large quantities of those chemicals to customers in the United States, Russia and Europe, distributing a portion of the synthetic cannabinoids through mailing facilities in the Middle District of Florida. From March 2011 through February 2012, Zhang shipped approximately 798 kilograms of these chemicals to the individual. In addition, he supplied Source1Herbs with large quantities of synthetic cannabinoids and cathinones.

On May 7, 2014, the United States Treasury Department - Office of Foreign Asset Control (OFAC) used the Kingpin Act to designate Source1Herbs and Dan and Kevin Louie, both Canadian nationals, on the Specially Designated National (SDN) List. The Kingpin Act permits the imposition of economic sanctions to preclude a variety of worldwide economic transactions.

In July 2013, Zhang and the individual had several discussions about synthetic cannabinoids, the latest trends in the worldwide industry, and the controlled status of certain chemicals, including UR-144, 5F-UR-144 and RCS-4. Zhang sent the individual various samples of synthetic chemicals known as 5 Meo Dalt (a synthetic cathinone), A834, 5F-UR-144, JWH-308 and WIN48098. Zhang also discussed emerging synthetic cannabinoids PB-22 and 5F-PB-22, both of which were controlled substance analogues of JWH-018 at the time, and then later a Schedule I controlled substance. After receiving a spreadsheet of Zhang’s inventory, the individual negotiated a purchase deal with Zhang for large quantities of UR-144, 5F-UR-144 and RCS-4. The negotiated price for approximately 773 kilograms of chemicals was $265,000, and Zhang agreed to provide the chemicals on consignment. Zhang agreed to ship mislabeled parcels containing 2 or 3 kilograms of those substances per parcel to various mailing facilities within the Middle District of Florida.

From Feb. 3, 2014, through May 16, 2014, HSI received 48 packages containing 144 kilograms of UR-144, 47 packages containing 106 kilograms of 5F-UR-144 (XLR-11), and 8 packages containing 16 kilograms of RCS-4. During the receipt of those packages, the individual further negotiated to pay Zhang $150,000 for the 266 kilograms of Schedule I controlled substances. In April 2014, Zhang traveled to the United States to retrieve $150,000 in cash for the substances, where he was ultimately arrested.

The Special Operations Division, along with the Narcotic and Dangerous Drug Section of the Department of Justice, coordinated Project Synergy to investigate and prosecute the leaders in the synthetic drug business, both domestically and internationally. The Office of International Affairs in the Justice Department’s Criminal Division also provided assistance.