SALT LAKE CITYA federal grand jury last week returned a 38-count indictment against the president of a company that manufactured and sold sports hydration drinks, federal prosecutors said.
The indictment, charging Randy Olshen with mail fraud, wire fraud and money laundering, claimed he received more than USD $7 million from at least 50 victims as part of a scheme in which he defrauded investors, according to the U.S. Attorney’s Office for the District of Utah in a news release. Olshen is one of the founders of Innovative Health Solutions LLC (IHS), whose products marketed for energy and stamina included H2O Overdrive.
The 51-year-old Olshen represented IHS had roughly $1.1 million in sales in 2009 when sales only totaled $98,275, and he claimed the company generated more than $28 million in 2012 sales when the figures were only around $579, 239, according to the indictment.
The indictment also alleged Olshen misrepresented the company had large receivable accounts with national chains, masked the company’s finances, and contrived documents including sales records. He also was accused of failing to pay creditors, using IHS funds beyond his reported salary for his personal benefit and paying a portion of investor funds to others as commissions for hauling in investments for the company.
The grand jury charged Olshen with 12 counts of mail fraud, nine counts of wire fraud and 17 counts of money laundering. For each count of mail fraud and wire fraud, he faces a maximum penalty of 20 years in prison with fines of $250,000 if he is convicted.
Olshen, who currently resides in Newport Beach, California, maintained a home in Summit County, Utah, during times that are relevant to the indictment. A number listed online for a Randy Olshen in Newport Beach was disconnected. Stephen McCaughey, a criminal defense lawyer in Salt Lake City who represents him, did not immediately respond to a request for comment on the indictment.
Olshen is due to make an initial appearance on Oct. 22 before U.S. Magistrate Judge Paul M. Warner.
Special agents of the FBI, IRS Criminal Investigation, and the Utah Division of Securities have been investigating the case, which is being prosecuted by the U.S. Attorney’s Office in Salt Lake City.