By Terry Kinney, Associated Press Writer
CINCINNATI A business owner convicted of defrauding customers seeking male sexual enhancement products and a variety of herbal supplements was sentenced Wednesday to 25 years in prison.
Steve Warshak, 42, founder of Berkeley Premium Nutraceuticals, also was ordered to pay $93,000 in fines. He was convicted in February on 93 counts of conspiracy, fraud and money laundering. Federal prosecutors accused the company of bilking customers out of more than $400 million with deceptive ads, manipulated credit card transactions and refusal to accept returns or cancel orders. U.S. District Judge S. Arthur Spiegel ordered Warshak, his mother, the company and another defendant to forfeit more than $500 million, including whatever was available from bank accounts, cars and homes, a grand piano and a membership in a California spa. Spiegel said it was impossible to calculate exactly how much money was lost by customers, so he accepted a figure based on how much Warshak and the company took in from offenses alleged in the indictments. Berkeley distributes various products alleged to boost energy, manage weight, reduce memory loss and aid sleep. The company's main product, Enzyte, promises sexual enhancement. "This is a case about greed," Spiegel said as he reviewed the case. "Steven Warshak preyed on perceived sexual inadequacies of customers." Spiegel said one aspect of the fraud relied on the reluctance of customers to come forward, which would mean admitting they ordered the sexual enhancement pills. "I don't see any evidence of remorse or concern for anyone but himself," Spiegel said. Warshak told the judge that was not true. "I do feel deep remorse and would like to apologize to any customer who ever had a bad experience with my company," he said. "I apologize to all the great people, the employees of Berkeley — they've given their heart and soul. I let them down." Spiegel said the company, which likely will be hit with the majority of the forfeiture, will be allowed to remain in business. Spiegel denied Warshak's request to remain free on bond pending appeal, but gave him 30 days to wrap up personal business and report to prison. Warshak's mother, Harriet Warshak, was sentenced to two years in prison. She was convicted of conspiracy, bank fraud and money laundering. Spiegel allowed her to remain free pending appeal and acknowledged that she is 75, has cancer and likely will never be incarcerated because of the time it takes appeals to work through the courts. Two other company employees were convicted on related charges and were to be sentenced Thursday, along with some former employees who pleaded guilty to other charges and cooperated with prosecutors. They testified that the company created fictitious medical endorsements, fabricated a customer-satisfaction survey and made up numbers to back claims about Enzyte's effectiveness. Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
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