Three South Florida residents were sentenced to 18 years of federal jail time each, on Thursday, for executing an elaborate plan to defraud manufacturers out of U.S. Food and Drug Administration-regulated items, including baby formula. 

Johnny Grobman, Raoul Doekhie and Sherida Nabi were convicted for a fraud scheme spanning over the years, from 2013 to 2018. The Department of Justice (DOJ) announced that the individuals deceived manufacturers so they’d provide significant discounts on items like formula and eye-care products, with the scheme costing companies more than $100 million. 

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Doekhie, 53, and Nabi, 57 are married and coordinated their lies to manufacturers. They pretended to have government procurement contracts and wanted to ship the products to Suriname, a South African nation. The DOJ noted that there were no such contracts and reality, and there haven’t been any ties with the Suriname government either. Instead, the obtained products were given to Grobman, 48, who then sold them across the country, making the trio a handsome profit. 

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The DOJ said, “The defendants hid their activity from the U.S. manufacturers of the FDA-regulated products in one of three ways”, adding, “The first was to send ‘dummy’ shipments abroad. The dummy shipments did not contain the products purchased from the manufacturers, but they did generate documentation to prove that an export occurred.” 

Their statement continued, “The second method was to ‘U-turn’ the products”. It involved shipping items abroad and generating “export documentation”. Then, the product would be shipped back to the US after landing overseas. As per the DOJ, this allowed to “create fraudulent export shipping documentation showing that the products were exported”, though they were never actually sent abroad. 

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They were initially found guilty in February 2020, but the sentencing has come to focus even more as the US grapples with a baby formula shortage. 

Special Agent in Charge Justin C. Fielder, FDA Office of Criminal Investigations Miami Field Office said in an official statement, “[Their sentencing] should serve as a reminder that those who fraudulently divert consumer products for profit will be held accountable for their actions”, adding, “We will continue to investigate and bring to justice those who engage in fraudulent schemes involving FDA-regulated products”.