Wausau man charged with fraud scheme involving illegal distribution of prescription drugs

 

Date: November 18, 2020

Contact: newsroom@ci.irs.gov

Kenneth Zipperer of Wausau, Wisconsin, is charged with mail fraud, wire fraud, dispensing prescription drugs without a license, and money laundering as part of a scheme involving an unlicensed pharmacy and the distribution of misbranded prescription drugs. The 26-count indictment alleges that Zipperer, who worked as an insurance broker selling Medicare supplement health insurance policies to individuals age 65 or older, imported prescription drugs from India that were not approved by the Food and Drug Administration for use in the United States and sold them to his health insurance clients.

The indictment alleges that Zipperer was not licensed to dispense or prescribe prescription drugs, and that he used his company staff, computers, and office space to order prescription drugs from India, break down bulk shipments into quantities for individual clients, store the drug inventory, issue invoices for payment, and deposit drug customer checks into the company's business bank account. The indictment further alleges that Zipperer requested his prescription drug customers to pay him in cash to avoid creating a paper trail of the financial transactions associated with his underground pharmacy's operations and that he conducted financial transactions knowing they represented the proceeds of unlawful activity. Finally, the indictment seeks the forfeiture of $231,315 representing the proceeds of the alleged mail and wire fraud, and $227,116 representing the amount of money involved in the money laundering offenses.

If convicted, Zipperer faces a maximum penalty of 20 years in federal prison on each of the 5 mail fraud charges, 10 wire fraud charges, and the 9 money laundering charges. The charge of dispensing prescription drugs without a license has a maximum penalty of 3 years in federal prison.

The charges against Zipperer are the result of an investigation by the IRS Criminal Investigation ; Food and Drug Administration, Office of Criminal Investigations; U.S. Postal Inspection Service; and U.S. Immigration and Customs Enforcement's Homeland Security Investigations. Assistant U.S. Attorney Daniel J. Graber is handling the prosecution.