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Fugitive Who Sold Counterfeit Baby Formula
Convicted of Federal Criminal Charges

A man who fled the county and remained a fugitive for six years after realizing he was under investigation has been convicted of four federal charges involving a conspiracy to sell counterfeit Similac baby formula.

Mohamad Mostafa, 43, who at the time of the criminal conduct lived in Orange County, was found guilty yesterday by United States District Judge Alicemarie H. Stotler following a three-day bench trial.

Mostafa, who was arrested in Canada in 2001, was convicted of all four counts in an indictment returned by a federal grand jury in June 2000. Mostafa fled the country in 1995 after his scheme to produce and sell large quantities of Similac was discovered.

Mostafa was the owner and operator of M&M Wholesale, which purported to be a wholesale grocery business with an office in Stanton and a warehouse in Santa Ana. In fact, M&M Wholesale was manufacturing, packaging and distributing counterfeit infant formula throughout California.

The infant formula used by Mostafa came from a wholesale supplier, which provided the formula to Mostafa under the condition that it would be used exclusively for export to the Middle East. Instead, Mostafa caused laborers to package it in cans bearing a counterfeit reproduction of the well known label of Similac Milk-Based Infant Formula with Iron. Mostafa then sold the counterfeit product as Similac to wholesalers, who in turn sold it to retail stores throughout California, including Safeway. Two of the counts in the indictment specifically alleged that Mostafa sold a total of approximately 3,500 cases of the counterfeit Similac to wholesale grocers in El Cajon and Buena Park.

The counterfeiting scheme quickly unraveled when numerous parents, who were familiar with the authentic Similac product, called the lawful manufacturer to complain. It was later determined that thousands of cases of the fake product had been sold throughout California.

The matter was widely publicized in national and local media after the FDA and Similac’s manufacturer, Ross Laboratories, issued a warning about the counterfeit product. After the counterfeit product was discussed in the media, Mostafa fled the country and was not seen again until he was arrested in October 2001 in Canada and brought to the United States to stand trial.

Judge Stotler convicted Mostafa of conspiracy, misbranding food shipped in interstate commerce and two counts of trafficking in counterfeit goods. As a result of the conviction, the maximum penalty that Mostafa can receive is 28 years in federal prison and a fine of $4 million. Mostafa is scheduled to be sentenced by Judge Stotler on November 18.

This case is the product of an investigation by the Food and Drug Administration, Office of Criminal Investigations. Los Angeles Field Office Special Agent In Charge Jud Bohrer stated: “Mostafa was in this country illegally, all the while engaging in this lucrative criminal activity that jeopardized the health and safety of thousands of infants. Infant formula is consumed by a vulnerable population which is unable to complain or reject a substandard product.“

CONTACT: Executive Assistant United States Attorney Wayne Gross
(213) 894-0711
Assistant United States Attorney Robb Adkins
(714) 338-3593
Release No. 02-120

 

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