First-ever use of Treasury’s financial sanctions tool against synthetic drug trafficking organization, in support of the Drug Enforcement Administration’s Project Synergy
WASHINGTON – The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) today designated the members and entities of a synthetic drug trafficking organization as drug kingpins pursuant to the Foreign Narcotics Kingpin Designation Act (Kingpin Act) for their significant role in international narcotics trafficking. Daniel Maurice Louie and Kevin Gim Louie, a father-son pair, are both Canadian nationals who buy and sell significant quantities of chemicals used to manufacture synthetic cannabinoids (commonly known as “synthetic marijuana”) and synthetic cathinones (or stimulants, such as “bath salts”) which are generally classified as Schedule I controlled substances in the United States. Two other individuals and four foreign-based entities were also designated today under the Kingpin Act. This action complements U.S. law enforcement actions taken today by the Drug Enforcement Administration (DEA) and other law enforcement officials under Project Synergy, the largest coordinated law enforcement strike against synthetic designer drugs.
For the past five years, Daniel and Kevin Louie have sold and shipped various U.S.-banned synthetic cannabinoids and cathinones to customers and vendors, domestically and internationally, primarily through their company, Source1herbs. Daniel and Kevin Louie have become a major source of supply for the synthetic drug industry, generating tens of millions of dollars in yearly sales. As new substances are banned in the United States, Daniel and Kevin Louie continually find replacements for banned synthetic chemicals in the United States, often mislabeling or advertising new chemicals as “not for human consumption.”
“The synthetics drug industry is a multi-billion dollar industry that looks to circumvent U.S. and other nations’ drug laws,” said OFAC Director Adam J. Szubin. “As the first designation targeting a synthetic drug trafficking organization under the Kingpin Act, today’s action underscores that Kingpin Act sanctions go beyond traditional narcotics trafficking organizations. Treasury will build on this action and continue to target such groups vigorously.”
The investigation that led to these designations was the result of collaborative efforts between OFAC and the DEA.
“The synthetic drugs that this family was manufacturing and distributing are just as dangerous, if not more dangerous than traditional illicit narcotics. Designating the members of this organization as drug kingpins sends a strong message that these crimes will be taken seriously, and DEA will continue to investigate and pursue these violators no matter where they may be located,” said Carl J. Kotowski, Special Agent in Charge of the DEA, New Jersey Division.
The two other individuals designated today are Francine Denise Louie, the wife and mother of Daniel and Kevin Louie, respectively, and business associate, Tramayne Primus, who is a national of Barbados. Francine Louie, who along with Kevin Louie was arrested in Canada on narcotics-related charges in June 2013, works for the family’s drug trafficking organization. Tramayne Primus works for Daniel Louie at Source1herbs, and Primus mainly coordinates payments for chemical orders placed through Source1herbs’ website.
The four foreign-based entities designated today are Source1herbs, Research FX Consultants Limited, Leading Edge Sourcing Company Corporation, and Boyle Chemical Co., Ltd., which are used by Daniel Louie, Kevin Louie, and/or Tramayne Primus to facilitate their synthetic drug trafficking operations and the laundering of illicit proceeds. Source1herbs, which operates in Canada and Barbados, is allegedly an herb and ethno-botanical sales company and it is owned or controlled by Daniel and Kevin Louie. Research FX Consultants Limited is also owned or controlled by Daniel and Kevin Louie. Leading Edge Sourcing Corporation (a.k.a. Source1wellness) is a supposed herbal compound distributing company that is owned or controlled by Daniel Louie, Kevin Louie, and Tramayne Primus. Boyle Chemical Co., Ltd. is a Chinese pharmaceutical company and is one of the foreign sources of supply of synthetic chemicals purchased by the organization.
As a result of today’s action, all property and interests in property in the United States or in the possession or control of U.S. persons in which Daniel and Kevin Louie or the other persons on companies designated today have an interest are blocked, and U.S. persons are generally prohibited from engaging in transactions with them.
Since June 2000 more than 1,500 individuals and entities have been named pursuant to the Kingpin Act for their role in international narcotics trafficking. Penalties for violations of the Kingpin Act range from civil penalties of up to $1.075 million per violation to more severe criminal penalties. Criminal penalties for corporate officers may include up to 30 years in prison and fines up to $5 million. Criminal fines for corporations may reach $10 million. Other individuals face up to 10 years in prison and fines pursuant to Title 18 of the United States Code for criminal violations of the Kingpin Act.
To view a chart of the Daniel and Kevin Louie network, click here.
For a complete listing of designations pursuant to the Kingpin Act, click here.
For more information about DEA’s Project Synergy, click here.
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