Louisiana Chemical Company Agrees To Pay Over $1.9 Million And Company Executives Charged In Investigation Of The Unlicensed Distribution And Exportation Of Regulated List 1 Chemicals

SCRANTON – The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Natural Advantage LLC a/k/a Taste Advantage LLC (“Natural Advantage”), a chemical manufacturer headquartered in Oakdale, Louisiana, entered a deferred prosecution agreement and was charged in a criminal information with the unregistered distribution and exportation of regulated List 1 chemicals.  Carol Callahan Byrne, age 65, and Dr. Brian Byrne, age 74, both of Oakdale, Louisiana, also were charged in a criminal information with the failure to report List 1 chemical manufacturing to the Attorney General.

Natural Advantage entered a three-year deferred prosecution agreement, under which the United States has agreed to defer prosecution of the company unless it fails to comply with the terms of the agreement.  Pursuant to the deferred prosecution agreement, Natural Advantage has agreed to forfeit $1,938,650.10, which represents the gross revenue of its List 1 chemical sales.  The company also has agreed, among other things, to undergo annual audits for List 1 chemical compliance, the results of which will be reported to the United States.

According to United States Attorney David J. Freed, Carol Callahan Byrne served as the Chief Financial Officer and Dr. Brian Byrne served as the Chief Executive Officer of Natural Advantage, a company that manufactured chemicals for customers in the flavor, fragrance, and cosmetics industries.  Among the chemicals manufactured by Natural Advantage were Piperonal, Heliotropine, Phenylacetic Acid, Isoamyl Phenylacetate, and Ethyl Phenylacetate, all of which were List 1 chemicals that, in addition to legitimate uses, are also precursor chemicals for manufacturing methamphetamine and ecstasy.  List 1 chemicals are subject to extensive regulations, including licensing requirements for distributors and regular reporting to the United States.

As alleged, beginning in approximately January 2011, and continuing until January 2017, Natural Advantage distributed and exported in excess of 1,550 kilograms of List 1 chemicals to customers in the United States and worldwide, without obtaining the requisite registration from the U.S. Drug Enforcement Administration (DEA), and despite being warned by the DEA not to distribute List 1 chemicals.  None of the chemicals are alleged to have been diverted to narcotics traffickers.

Company executives are alleged to have known of Natural Advantage’s unlicensed distribution of List 1 chemicals, and of arrangements to use other domestic companies as intermediaries to sell List 1 chemicals to foreign customers who discovered that Natural Advantage was not licensed and refused to purchase the chemicals.  Company executives also are alleged to have concealed Natural Advantage’s List 1 chemical activities, including, as alleged against Carol Callahan Byrne and Dr. Brian Byrne, by failing to file annual manufacturing reports with the Attorney General.

“The defendants in this case violated the law when they sold and exported nearly $2 million-worth of precursor chemicals, without following the regulations and procedures designed to ensure that these chemicals do not end up on the black market,” said U.S. Attorney Freed. “As part of our responsibility to help protect the public from dangerous drugs, this office will continue to ensure that companies properly handle List I chemicals.”

“By intentionally evading the regulations in place for List I chemicals, Natural Advantage greatly increased the possibility that these chemicals could end up in the hands of cartels for the production of methamphetamine, ecstasy, and other dangerous and illicit substances,” said Jonathan A. Wilson, Special Agent in Charge of the DEA’s Philadelphia Field Division.  “In light of the rise of methamphetamine use in the United States and the damage it causes to our families and our society, DEA will continue to enforce these regulations and seek out these violators.”

The case was investigated by DEA Diversion Investigators. Assistant U.S. Attorney Phillip J. Caraballo, and the Financial Litigation Unit of the U.S. Attorney’s Office are prosecuting the case.

Criminal informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.

A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.

The maximum penalty under federal law for the charge against Natural Advantage is up to five years of probation, and the maximum penalties for the charges against Carol Callahan Byrne and Brian Byrne are up to one year of imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.

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