A Federal Jury Finds Criminal Defense Attorney Guilty Of Drug Conspiracy And Money Laundering Charges
Lafayette, La. - Drug Enforcement (DEA) Assistant Special Agent in Charge Joseph W. Shepherd and United States Attorney Stephanie A. Finley announced that a federal jury found Lafayette attorney Daniel James Stanford, 56, guilty of conspiring to distribute synthetic drugs, conspiring to introduce misbranded drugs into interstate commerce, and money laundering charges.
After an eight-day trial, over six hours of deliberation, hundreds of pages of exhibits, and testimony from 30 plus witnesses, the jury found Stanford guilty of one count of conspiracy to distribute or possess with intent to distribute a controlled substance analogue, one count of conspiracy to introduce or cause to be introduced misbranded drugs into interstate commerce, one count of conspiracy to launder money, and five counts of money laundering. Stanford was found not guilty on five counts of the indictment, which outlined additional money laundering charges. U.S. District Judge Elizabeth E. Foote presided over the trial.
In September of 2012, Stanford, Curious Goods, a Limited Liability (LLC), and eight co-conspirators, 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 Paul Francis, 42 of Dawsonville, Ga.; and Barry L. Domingue, 52 of Carencro, La., were charged by a grand jury in a 16 count indictment with conspiracy to distribute synthetic drugs, conspiracy to introduce misbranded drugs into interstate commerce, conspiracy to commit money laundering, and various money laundering charges.
At the time of the indictment, Curious Goods, LLC, was a business based in Lafayette and controlled by co-conspirator Richard Buswell. Buswell has since pleaded guilty to other federal charges involving an investor fraud scheme. During the trial, evidence showed that Curious Goods stores 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. The synthetic cannabinoids infused into “Mr. Miyagi” are considered Schedule I controlled dangerous substances under federal law, but were marketed by Stanford and his co-conspirators as every day potpourri. Witnesses testified that on March 1, 2011 to December 31, 2011, Curious Goods stores throughout Acadiana raked in approximately $5 million for the sale of the illegal “Mr. Miyagi” product and paid the supplier of “Mr. Miyagi”, Pinnacle Products, approximately $1.5 million.
Testimony at trial identified Pinnacle Products LLC/Pinnacle Products Group, based in Marietta, Ga., as the manufacturer of the “Mr. Miyagi” products being sold in Acadiana. They supplied the products to local Curious Goods stores. Pinnacle Products LLC was controlled and operated by Stanford’s co-conspirators, Boyd Anthony Barrow and Joshua Espinoza. Pinnacle obtained the synthetic cannabinoids utilized to manufacture “Mr. Miyagi” from NutraGenomics, which was located in an Alpahretta, Georgia and controlled by co-conspirators, Drew T. Green and Thomas William Malone, Jr. NutraGenomics distributed synthetic cannabinoids throughout the United States. The majority of the synthetic cannabinoids distributed by NutraGenomics were supplied by another one of Stanford’s co-conspirators, Alexander Derrick Reece.
Prior to trial, Stanford’s co-conspirators, Reece, Green, Malone, Barrow, Espinoza, Buswell, and Francis all pleaded guilty in federal court, but appeared in federal court as witnesses for the government in this trial. Stanford, who is a criminal defense attorney, decided to represent himself at trial. During opening statements, after the government laid out how they expected the evidence to reveal Stanford’s knowing involvement in the drug conspiracy, Stanford told the jury that his “integrity and honor” were “not negotiable,” and he advised the jury that he was “absolutely not guilty of any of this.” However, at trial, the evidence showed that Stanford was actively involved with the Curious Goods enterprise, that he was well aware that the company sold a product called “Mr. Miyagi,” and that “Mr. Miyagi” was a substance that was infused with synthetic cannabinoids.
Exhibits introduced at trial exposed that “Mr. Miyagi” was specifically labelled “not for human consumption” and sold as a product that would be smoked by users to get high. The evidence also demonstrated that the product was packaged to be intentionally false and misleading, marketed as potpourri. The exterior package label of “Mr. Miyagi” stated that it was to be used to refresh scent in drawers, closets, and cars; all of which Stanford knew to be false. It listed its ingredients as “exotic blend of Herbs, Plants and Botanicals.” The package also advised purchasers that “[a]s of this printing, this product complies with all U.S. federal laws;” another statement which Stanford also knew to be false. During the trial, prosecutors showed jurors just how misleading the labeling was by opening a packet of the so-called scent refresher which resembled marijuana. Testimony at trial made it clear that Stanford knew that the product was being consumed by humans, that it was harmful and not a scent refresher, and that the product was marketed to youthful customers. The intentional mislabeling and misbranding, spearheaded by Stanford, were part of a legal strategy and subterfuge to feign compliance with the law, to avoid law enforcement detection, and to avoid civil and criminal liability.
Testimony at trial outlined that as the conspiracy progressed, individuals were recruited to purchase Curious Goods franchises. Then as the business grew and franchise stores opened, the Curious Goods organization brought in Stanford, and Stanford in turn recruited co-conspirator Dan Francis. Francis’ role was to assist Stanford in forming Louisiana’s version of the Retail Compliance (RCA), a company that was formed as a non-profit, but utilized for the sole purpose of advising smoke shops and other retail outlets how to strategically sell and market synthetic drugs as common, every day, over the counter products. Stanford named himself as Director of RCA and was advised by Dan Francis who was experienced in the synthetic cannabinoid industry.
Emails introduced at trial showed that Stanford wanted Louisiana’s RCA to facilitate the conspiracy. At trial, witnesses testified that franchise owners were forced to join the Louisiana RCA. Evidence showed that for his efforts, Stanford was to collect between $1,000 and $5,000 weekly from each Curious Goods franchise store based on the volume of sales from the stores, in addition to collecting $6,250 each from the Curious Goods companies and Pinnacle Products, a total of $12,500 per week. Witnesses testified that Stanford, through RCA, stood to be paid approximately $40,000 - $50,000 per week from all of these sources.
In order to maintain the supply of “Mr. Miyagi” from Georgia and to convince prospective franchisees to sell Mr. Miyagi, Stanford and Richard Buswell convinced Pinnacle Products and franchisees that they, Stanford and Buswell, had obtained a letter from the Louisiana Attorney General’s Office permitting the sale of “Mr. Miyagi” in the state of Louisiana for two years, which Stanford knew to be untrue and knew that no such letter existed. At trial, the government played recordings of Stanford advising franchise owners that he met with Louisiana’s Attorney General. Stanford was trying to convince disgruntled franchisees to continue working, selling and receiving products from Pinnacle, despite what seemed to be clear law enforcement action indicating that the product they were selling was illegal.
At trial, Kurt Wall, the Director of the Criminal Division of the Louisiana Attorney General’s Office testified that the alleged letter never existed, and no one from the Attorney General’s Office had ever spoken to Stanford regarding any synthetic drugs. In addition, Louisiana Attorney General, James D. “Buddy” Caldwell, was called as a witness and testified that neither he nor anyone in his office would make assurances that could lead to the introduction of synthetic drugs into Louisiana.
During the course of the conspiracy, some of the co-conspirators confronted Stanford about the existence of the so called Attorney General letter. Witnesses stated under oath that after being confronted, Stanford admitted that he did not have a letter, but was a close personal friend of the State Attorney General, and the two had a hand shake agreement about the synthetics. After the confrontation, Stanford shifted his story and explained that Caldwell assured him that no one would be prosecuted by the Attorney General’s Office for dealing in the substance. However, Louisiana Attorney General Caldwell testified to jurors that he did not know Stanford, and during closing arguments, Stanford conceded that he did not meet with Caldwell on the synthetic cannabinoids.
Among the many witnesses testifying at trial, were local law enforcement and DEA Task Force agents who testified that during the execution of search warrants, on December 8, 2011, they searched all Curious Goods store locations, including the company’s warehouse in Lafayette and seized approximately 190 pounds of synthetic drugs.
Stanford faces up to 30 years in prison and a fine of up to $2 million for his role in the drug conspiracy. For the charges relating to the conspiracy to misbrand, he faces up to five years in prison and a fine of up to $250,000. The money laundering conspiracy and each count of money laundering carries a sentence of up to 10 years in prison and a fine of up to $250,000. A sentencing date for Stanford has not been set. Stanford’s co-conspirators are set to be sentenced on September 19, 2014.
The DEA, Federal Bureau of Investigation, Homeland Security Investigations, the Internal Revenue Service, Lafayette Police Department, Lafayette Parish Sheriff’s Office, Iberia Parish Sheriff’s Office, Vermillion Parish Sheriff’s Office, and the Louisiana State Police conducted this investigation. Assistant U.S. Attorneys John Luke Walker, J. Collin Sims, and Robert C. Abendroth prosecuted the case.
U. S. Attorney Finley stated, “This case is a huge victory for the Acadian area. Too many members of our community visited these shops that sold this poison, especially the youth. Stanford’s insatiable desire for money drove him to join this conspiracy and put many, many people in harm’s way. Today his greed and criminal activity have consequences. This case highlights how lucrative this industry is and reveals the length that criminals are willing to go to profit while endangering the health and safety of citizens. Stanford’s goal was to hide behind what he wanted the world to believe was a legitimate company, but his scheme failed because of the dedicated men and women of federal, state and local law enforcement who are committed to the safety of this community. They are to be commended for years of hard work to get these illegal substances off the street and hold these criminals accountable. I hope that store owners, franchisees, investors and distributers who want a make a fast buck at the expense of others think twice and understand that we will not hesitate to investigate and prosecute their criminal activity.”
Parents and children are encouraged to educate themselves about the dangers of drugs by visiting DEA’s interactive websites at www.JustThinkTwice.com, www.GetSmartAboutDrugs.com and www.dea.gov.
