FBI: Hand Over ‘Italians’ in RICO Opiate Case

The FBI is painting for the Italian government a portrait of two of its citizens as heartless, greedy killers of at least 700 residents of Florida and Tennessee and making this pitch: Send Luca Sartini and Luigi Palma to America to face justice.

U.S. Attorneys Tracy Stone and Kelly Pearson have filed in U.S. District Court an affidavit by FBI Agent Steven P. Haughton in a bid to convince the Italian government to extradite Sartini and Palma to the U.S.

The pair and a third man – Benjamin Rodriguez – are accused in a Racketeer Influenced and Corrupt Organization, or RICO, conspiracy indictment unsealed in January.

Death toll climbing

The indictment is connected to FBI raids nearly three years ago of clinics in East Tennessee the agency says were nothing more than cash-for-opiates operations that generated $21 million in profit in four years, put millions of prescription painkillers into the hands of addicts, and left a trail of dead patients.

The FBI says the East Tennessee operation was merely a spin-off from the trio’s highly-profitable and highlydeadly Urgent Care and Surgery Center network of emergency clinics, walk-in clinics and pain clinics in South Florida.

“It is known that approximately 700 of those patients are now dead, and that number is expected to rise as the investigation continues,” Haughton wrote in his extradition affidavit.

Although the allegations in the indictment – kickbacks, drug-dealing, intimidation and death – mirror a mafiastyle operation, this trio dubbed “the Italians” by workers in the clinics are accused of racketeering entirely within the medical community. It’s a new frontier for law enforcement and prosecutors battling the opioid epidemic.

Ready to run

Haughton says Sartini, 58, and Palma, 51, began making plans to flee to Italy as soon as the manager of the East Tennessee clinics – 53 year-old grandmother Sylvia Hofstetter – was arrested in 2015. The pair have dual citizenship. They were in Italy when the January indictment was unsealed and are being held there now. The FBI wants them extradited.

“This investigation has revealed that Sartini and Palma devised a plan to flee the United States should they ever face the likelihood of criminal prosecution,” Haughton wrote.

The pair and Rodriguez used a slew of shell companies to keep their names off the records connected to the pill mills and feeder clinics and intermediaries within the medical community to cloak their involvement and had avoided prosecution in South Florida, testimony and court records have shown.

But Hofstetter, described in Haughton’s affidavit as so closely tied to Sartini that workers thought “they were married,” had key information about the inner workings of the operation and was now behind bars in East Tennessee. The FBI had arrested more than 100 people tied to the clinics, including doctors, workers and patients, and many of them were now cooperating against both Hofstetter and “the Italians.”

According to Haughton’s affidavit, Sartini and Palma ordered “various associates” to find out what the FBI knew about them “utilizing pretenses and false statements.” The pair also offered to spirit away a “co-conspirator out of the United States.”

Sartini and Palma in early 2017 visited a Miami lawyer, who “advised Sartini and Palma to flee the United States to avoid this prosecution,” Haughton wrote.

The men did just that months later, the agent said in his affidavit.

The U.S. has an extradition treaty with Italy, but federal authorities still must convince the Italian government to honor it. Haughton offered this blunt assessment of why it should.

“Sartini (and) Palma made the conscious and deliberate decision to enrich (themselves) at the expense of thousands of human lives,” Haughton wrote. “Based on the severity of the charges pending against (them) and (their) attempt to flee from this prosecution, Sartini (and) Palma should be extradited to the United States to answer for (their) serious criminal conduct.”

Chasing the market

The FBI alleges Sartini, Palma and Rodriguez were businessmen looking to cash in on the enormous profits being generated by the market for prescription painkillers the Department of Justice has said in court records the opiate makers – so-called “Big Pharma” – ginned up by lying to doctors about the addictive properties of their drugs. Doctors then began overprescribing the drugs, creating addicts out of patients.

The trio set out to capitalize on that in the early 2000s by setting up in South Florida – then the base for what would become an epidemic – a network of legitimate- looking medical facilities with the sole purpose of trading cash for prescriptions, court records allege.

They recruited doctors and other licensed prescribers to do the drug dispensing and made deals with national drug-testing laboratories to funnel them hundreds of thousands of dollars in bogus drug-testing work in return for kickbacks, Haughton alleged in the indictment.

When authorities in South Florida began cracking down on pill mills, the indictment alleges Sartini, Palma and Rodriguez simply shifted their entire operation to East Tennessee, one of the largest markets for opiates in a state where just a few years ago anyone could open a pain clinic with no medical

background required. Hofstetter remains jailed and maintains her innocence. The chief medical director of the network of clinics at issue in the case – Dandridge doctor Richard Larson – died soon after he was indicted. Other doctors who worked at the clinics have struck plea deals as have two intermediaries involved in the kickback scheme.

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