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Wealthy Socialite Grandmother Ran Massive Florida to Tennessee $17 Million Dollar Illegal Presrciption Drug Operation

May 10, 2015  |  Posted by: JammedUp Staff
Wealthy Socialite Grandmother Ran Massive Florida to Tennessee $17 Million Dollar Illegal Presrciption Drug Operation

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A well-known Tennessee businesswoman, socialite, and grandmother, known for hosting lavish pool parties lived a double life to the shock of Knoxville residents.

The F.B.I. have accused 51-year-old Sylvia Hofstetter, a wealthy healthcare administrator, operating a massive $17.5 million prescription drug ring, the largest in Tennessee history. Hofstetter faces 20 years in prison if convicted.

Hofstetter wasn’t afraid to spend her money; she would often renovate her 3,400 square-foot house in the upscale community of Falcone Point. During the holidays, she decorated her entire property with Christmas lights and threw extravagant BBQ parties for the entire community.

However, the facade of a socialite granny was smashed after the FBI charged Hofstetter with drug trafficking, money laundering conspiracy and multiple counts of money laundering.

She is currently sitting in jail while awaiting trial in federal court. Richard Escobar, the Tampa-based attorney representing her said Hofstetter has no criminal record. Escobar insists when “all the facts of the case come out, it will prove she is innocent of all charges.”

He added,”She’s a splendid person, an excellent mother, who has hired counsel in order to investigate and so the truth can come out.’

A contractor who knew Hofstetter while he performed renovation work on one of the clinics called her one of the hardest-working businesswoman he has ever known.

‘It was the first time I met a lady who understood what she wanted to with regards to construction,’ Lynn Johnson testified during her bail hearing in March.

Family friend Carie Pfrogner testified how Hofstetter is very close to her sever-year-old grandson. “That’s her obsession; She’s in love with that little boy. She would have the child over any chance she could get,” Pfrogner said.

The government alleges Hofstetter of operating several pain clinics, some of which she sold illicit painkillers for cash, too as many as 100 addicts a day.

Others clinics she kept legitimate that only serving insured people. However, people without insurance, would be referred to clinics where oxycodone and other narcotics medications, where addicts received prescriptions for cash.

During her detention hearing, FBI Agent Andrew Chapman testified how two overdose deaths could be directly linked to pain medications prescribed by her clinics. Chapman said the pain management clinics were initially funded by three Florida men, who Hostetter referred to as “The Italians.”

Feds say the changing market shifted the attention of the pill mill operators to East Tennessee.

“We know, from interaction with law enforcement down there, that Tennessee license plate tags were frequently the most observed state tags in the parking lot on drug surveillances,’ Chapman said, as he explained the Florida pill mills.

Since the customer base demand was in Tennessee, Hofstetter established clinics in Knoxville and Lenoir City, which would serve over a 1,000 patients a month.

Pill mill operations were at an abundance at one time in Florida, attracting drug dealers and addicts from across the U.S.

However, since the state of Florida clamped down on pain clinics, it has forced pill mill operations to concentrate in the southern markets including Georgia and Tennessee.

‘In just a few short years, she went from having a modest income for South Florida terms to richer beyond probably her wildest dreams, with a lifestyle to match,’ Assistant U.S. Attorney Tracy Stone said during the hearing.

“The 4-year investigation discovered $6 million worth of financial transactions Hofstetter made at casinos, even though her tax returns didn’t match anywhere near that amount of money she had claimed,” Chapman said.

According to F.B.I. Estimations, the clinics prescribed more than 12 million prescriptions for painkilling medications including morphine, oxycodone, and oxymorphone over a four-year period.

A patient would pay an average of $350 per visit. The wide-ranging federal indictment has implicated 100 people including a former police chief, former employees of the clinic, and patients.

Federal Agents have seized valuable items including several pain clinics, her home, two Lexus vehicles, big screen TVs and over 100 expensive jewelry items including a Rolex watch and diamond rings.

The judge designated Hofstetter a flight risk and refused to grant her bail. U.S. Magistrate Judge C. Clifford Shirley said during the ruling: “The evidence suggests that these clinics appear to be one thing on paper, but in reality are something else, I’m concerned that the picture painted of Ms. Hofstetter is the same.’

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