A federal grand jury indicted a couple from Rogersville for selling synthetic marijuana at a store called Magic Dragon in Rogersville. Investigators believe Doy Case, 79, and Tressie Case, 67, sold $1 million of that product, which is also known as K2.
The Cases are charged in a nine-count indictment returned under seal by the grand jury in Springfield on Tuesday. That indictment was unsealed and made public on Wednesday after the arrests and initial court appearances of the Cases. They'll stay in federal custody at least until a detention hearing on Friday.
The Cases own a Magic Dragon, which operated at 382 Redbud Street in Rogersville. Investigators believe the Cases received delivery of approximately 101,861 grams of synthetic cannabinoids between Sept. 15, 2010, and Nov. 13, 2012. Investigators say they charged an average price of $10 per gram of synthetic cannabinoids; therefore, it appears they grossed approximately $1 million during this period.
Investigators found records that the Cases deposited approximately $672,349 into their bank accounts.
Federal agents contacted the Cases in August 2012, according to an affidavit against them, and told them that the sale of synthetic cannabinoids was illegal. Agents gave the Cases the opportunity to voluntarily cease and desist, but they did not.
The affidavit says the Cases advertised their products to minor children. On at least seven occasions, investigators found they placed advertisements in high school yearbooks or with student organizations.
Investigators believe the Cases participated in a conspiracy between Sept. 15, 2010, and Nov. 13, 2012, to defraud the Food and Drug Administration and to defraud the public by falsely representing that a number of synthetic cannabinoid products were “herbal aromas,” “natural fragrances” or “incense” and “not for human consumption.” In reality, the grand jury believes, these substances were synthetic cannabinoids that contained compounds that were intended for human consumption as a drug.
Investigators found the Cases sent payments through the mail to purchase the illegal substances from several sources, which shipped their orders through a commercial carrier.
In addition to the mail fraud conspiracy, Doy and Tressie Case are charged together with participating in a conspiracy to distribute a controlled substance, three counts related to possessing a controlled substance with the intent to distribute and one count of maintaining a place for the purpose of storing and distributing a controlled substance.
The grand jury also believes the Cases participated in a money-laundering conspiracy. According to the indictment, the Cases conspired to conduct financial transactions which involved the proceeds of unlawful activity (the mail fraud and drug-trafficking conspiracies). In addition to the conspiracy, Doy and Tressie Case are charged together in two counts of money laundering.
The indictment also contains a forfeiture allegation, which would require the Cases to forfeit to the government any property derived from the proceeds of the alleged offenses, including a money judgment of $672,349 related to the mail fraud conspiracy and a money judgment of $639,662 related to the drug-trafficking conspiracy.
The Rogersville Police Department, the Webster County Sheriff’s Department, the Missouri State Highway Patrol, the Drug Enforcement Administration and IRS-Criminal Investigation investigated this case.