A Houston man was handed a 19-year prison sentence on Monday after being found guilty of running an illegal pharmacy operation that distributed millions of opioid pills without prescriptions.
The case also involved tax fraud, adding another layer to the serious charges.
Who Is Christopher Obaze and What Was His Role?
Christopher Obaze, 64, owned and managed Chrisco Pharmacy in Houston.
But instead of running a legitimate business, he and his partners operated what’s known as a “ghosting pharmacy.”
This meant they bought large amounts of addictive prescription drugs like hydrocodone and oxycodone from wholesalers and then sold them in bulk directly to drug traffickers.
They did all this without involving doctors, patients, or valid prescriptions.
From early 2018 through late 2021, Obaze and his team pumped out over 2.2 million pills as part of this illegal operation.
That’s a staggering amount of opioids flooding the streets through this scheme.
Covering Up the Crime and Tax Fraud
To hide their wrongdoing, Obaze and a pharmacy technician stopped reporting drug dispensing activities to the Texas State Board of Pharmacy after July 2018.
They also manipulated cash deposits and submitted false documents to banks to keep their accounts active, allowing them to stash the illegal profits.
On top of that, Obaze helped prepare and file false tax returns, deliberately underreporting the pharmacy’s income to the IRS.
This was part of an effort to avoid paying the full amount of taxes they owed.
Who Investigated and Prosecuted the Case?
The investigation was a joint effort between the Drug Enforcement Administration (DEA) and the IRS Criminal Investigation unit.
Top officials, including Matthew R. Galeotti from the Justice Department’s Criminal Division and U.S. Attorney Nicholas J. Ganjei for the Southern District of Texas, announced the sentencing.
The prosecution was led by Drew Pennebaker, a trial attorney specializing in fraud within the Justice Department’s Criminal Division.
Fighting Healthcare Fraud on a Larger Scale
This case falls under the broader umbrella of the Health Care Fraud Strike Force Program, which tackles fraud across the healthcare system.
Since its start in 2007, the program has charged thousands of defendants who have collectively defrauded federal healthcare programs and private insurers out of more than $30 billion.
Federal agencies like the Centers for Medicare & Medicaid Services and the Department of Health and Human Services’ Office of Inspector General are also working hard to crack down on healthcare fraud and hold those responsible accountable.