United States Drug Enforcement Administration

SANTA ANA, Calif. - A San Gabriel Valley doctor who pleaded guilty to a federal drug trafficking charge for illegally distributing the powerful opioid best known by the brand name OxyContin was sentenced today to over 13 years in federal prison. The sentencing is the result of an investigation led by the Drug Enforcement Administration.

Dr. Daniel Cham, 49, a Covina resident who formerly operated a clinic in La Puente, was sentenced today by United States District Judge Andrew J. Guilford. As he was sentencing Cham, Judge Guilford expressed concern “that other doctors haven’t gotten the message of the seriousness of this activity.”

Cham pleaded guilty in April 2016 to one count of distribution of oxycodone, a powerful and addictive painkiller marketed under various names, including OxyContin, Vicodin and Norco. Cham also pleaded guilty to one count of money laundering.

In documents filed in relation to today’s sentencing, prosecutors wrote that Cham “stands before the court for selling prescriptions for massive amounts of oxycodone to persons he well knew were drug dealers and addicts, in exchange for hundreds of thousands of dollars in cash. Defendant’s illegal prescriptions killed at least two addicted youths, including a 22-year-old woman and 28-year-old man.”

The young woman, who was a resident of Oregon, died after ingesting narcotics prescribed by Cham to members of Oregon-based drug trafficking conspiracy. Cham issued prescriptions in the names of the Oregon drug traffickers - many of whom he had never met - and Cham created fake paperwork to make it falsely appear he had examined the “patients.” Investigators in Oregon identified over 12,000 pills of oxycodone that Cham illegally prescribed to the drug traffickers in that state.

“Dr. Cham broke the Hippocratic Oath he swore to uphold when he became a physician - instead of serving the public good, his actions caused harm and death,” said DEA Special Agent in Charge David J. Downing. “Cham was no longer functioning as a healer but a common drug dealer, and his sentence should serve as a cautionary tale to other physicians who would choose this path for the sake of greed.”

“There is an opioid-abuse epidemic in this nation, and some of that drug abuse is fueled by unscrupulous doctors like this defendant,” said United States Attorney Nicola T. Hanna. “The lengthy sentence imposed in this case is the direct result of this defendant’s profiting from prescribing narcotics to persons he knew to be addicts and drug dealers - actions that led to fatal overdoses for two people.”

In a plea agreement filed in this case, Cham admitted that he unlawfully prescribed oxycodone to an undercover agent posing as a patient in March 2014 in exchange for $300 in money orders, which Cham then deposited into a bank account held in the name of another business. Cham made the deposit “knowing that the transaction was designed to conceal and disguise the nature and source of the money orders,” according to the plea agreement.

Acting on tip about a pharmacy that was filling a large number of prescriptions written by Cham, special agents with the Drug Enforcement Administration discovered a “large-scale criminal operation” in which Cham was writing thousands of prescriptions for powerful painkillers, often in combination with (often sold under brand name Xanax) or (often sold under the brand name Soma), according to court documents. “The combination of these drugs is particularly dangerous, and is associated with the majority of overdose deaths,” according to a sentencing memorandum filed in court.

A doctor who specializes in pain management and addiction reviewed Cham’s history of writing prescriptions and found “gross and overwhelming evidence of inappropriate prescribing of narcotics and controlled drugs.” The expert also reviewed recordings made by undercover operatives who obtained prescriptions from Cham and found that the doctor was “essentially at that point dealing drugs.”

An affidavit previously filed in this case discussed how an undercover officer made three visits to Cham’s La Puente office in 2014, and how Cham wrote prescriptions for controlled substances in exchange for $200 or $300 in cash or money orders. As discussed in the court document, Cham issued a prescription for oxycodone even though the undercover operative said he “had been high and drunk while receiving controlled substance prescriptions” previously from Cham. On another occasion, Cham prescribed oxycodone even though the undercover law enforcement officer presented, in lieu of photo identification, a written notice that his license had been suspended for driving under the influence.

“Not only did defendant Cham abdicate his oath as a physician, he deliberately caused harm by continuously drugging addicts who were in need of rehabilitation,” said Paul Delacourt, the Assistant Director in Charge of the FBI’s Los Angeles Field Office. “The FBI will continue to work with our partners to end illegal drug networks operating out of doctors’ offices.”

In his plea agreement, Cham also agrees to forfeit to the government more than $60,000 in cash that he admits are “proceeds of illegal activity.”

“While exploiting his patients’ addictions for his own personal gain, Cham laundered tens of thousands of dollars in cash and money orders through bank accounts held in fake business names such as Good Life 2 LLC. The good life Cham created for himself was fueled by a callous disregard for his patients’ well-being,” stated R. Damon Rowe, Special Agent in Charge for IRS Criminal Investigation. “IRS Criminal Investigation contributes our financial expertise in an effort to stop criminals who profit from the illegal trade of dangerous narcotics and take away any financial benefit they receive from their criminal activity.”

The investigation into Cham was conducted by the Drug Enforcement Administration, the Federal Bureau of Investigation Los Angeles and Portland Field Offices, IRS Criminal Investigation, the Los Angeles County Sheriff’s Department’s Health Authority Law Enforcement Task Force, the California Medical Board, and the Los Angeles Police Department.

The case against Cham was prosecuted by Assistant United States Attorney Benjamin Barron of the Organized Crime Drug Enforcement Task Force.