Timothy Keay Isaac, 47, of Scottsdale, Ariz., pleaded guilty earlier this week to Conspiracy, Introducing Misbranded Drugs into Interstate Commerce, Making False Tax Returns, Filing False Declarations in a Bankruptcy Proceeding and Theft of Government Money.
According to the plea, Isaac, through his companies Ultra Health Products, Bionate International and Johnston-Keay, marketed a product called Vinarol that he claimed would promote sexual enhancement and was an all-natural herbal dietary supplement. Isaac and others failed to disclose that Vinarol actually contained sildenafil citrate, the active chemical ingredient in the prescription drug Viagra, and did not require customers to provide a physician's prescription before receiving Vinarol. Isaac and others had smuggled the sildenafil citrate from China into the United States without declaring the merchandise for invoicing as required by Customs law.
Bryan and Laura Gillette, who were charged in the Indictment along with Isaac, pleaded guilty earlier this month to one felony count each of introducing misbranded drugs into interstate commerce.
In 2004, Isaac filed for bankruptcy under Chapter 11 but failed to disclose his interest in Ultra Health, Bionate, or Johnston-Keay and claimed his monthly income was $0.00. In 2006, Isaac filed for Disability Insurance Benefits with the Social Security Administration and was subsequently awarded benefits in excess of $35,000. During 2006, Isaac also obtained a mortgage in the amount of $2,175,000 in order to purchase a $2.9 million dollar home in Desert Mountain, Scottsdale, Ariz. In October 2006, Isaac also filed an Individual Income Tax Return for 2005 reporting a zero taxable income and a zero tax liability when he actually had taxable income of $80,103. Isaac filed similar returns for the tax years 2006 and 2007 reflecting the zero balances when in fact his actual taxable income was $75,881 and $388,687 for the years 2006 and 2007 respectively.
A conviction for Conspiracy carries a maximum penalty of five years imprisonment, a $250,000 fine or both. A conviction for Introduction of Misbranded Drugs or Filing a False Tax Return each carry a maximum penalty of three years, a $250,000 fine or both. A conviction for False Declaration in Bankruptcy carries a maximum penalty of five years, a $250,000 fine or both. A conviction for Theft of Government Funds carries a maximum penalty of 10 years, a $250,000 fine, or both. In determining an actual sentence, the judge will consult the U.S. Sentencing Guidelines, which provide appropriate sentencing ranges. The judge, however, is not bound by those guidelines in determining a sentence.
The investigation preceding the Indictment was conducted by the U.S. Food and Drug Administration Office of Criminal Investigations. The investigations involved in the Information were conducted by the Internal Revenue Service—Criminal Investigations Division, the United States Trustees Office, and the Social Security Administration. The prosecution is being handled by Special Assistant U.S. Attorney Steven Tave, of the FDA, and by Peter Sexton Assistant U.S. Attorney, District of Arizona, Phoenix.
CASE NUMBER: CR-08-0036-PHX-PGR
RELEASE NUMBER: 2009-216(Isaac)
For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.usdoj.gov/usao/az/