Dov Shellef, Chemical Diversion, NY 2006

New York, NY – Dov Shellef was sentenced to 60 months in federal prison for his role in a sophisticated scheme to divert a chemical compound intended for export into the illicit methamphetamine manufacturing pipeline. The case, originating in 2003, revealed a deliberate effort to defraud the United States government and facilitate the production of illegal narcotics destined for Mexico.

According to court documents, Shellef and his co-conspirator, Rubenstein, illegally diverted CRC-113 – a chemical compound produced for export – to the domestic market. Crucially, they failed to report any of these exports, effectively concealing the diversion from regulatory oversight. The diverted chemical was then sold to All Discount, a distribution company that knowingly supplied the substance to Mexican nationals involved in the large-scale manufacture of methamphetamine.

The initial indictment in June 2003 laid out a staggering 46 counts of fraud (18 U.S.C. 1343) against Shellef, alongside 41 counts of racketeering (18 U.S.C. 1956(a)(1)(A)), one count of conspiracy (18 U.S.C. 371), and multiple violations of IRS statutes (26 U.S.C. 7201, 26 U.S.C. 7206(1)). Rubenstein faced similar charges, though with a slightly reduced count of 43 fraud charges. The prosecution successfully argued that the defendants knowingly participated in a criminal enterprise designed to profit from the illegal drug trade.

Following a trial in July 2005, both Shellef and Rubenstein were convicted on all counts. Initially sentenced to 70 months incarceration and 36 months probation, Shellef was later re-sentenced in February 2011 to 60 months, with the same probationary period. He was also ordered to pay a $5,300 special assessment. Rubenstein received an 18-month prison sentence, 36 months probation, a $4,400 special assessment, and a $10,000 federal fine. Both defendants were jointly held liable for $1,880,461 in restitution to the IRS, though this was later amended for Shellef, with the restitution order being dropped.

While the Court partially granted a motion for acquittal in August 2010, the core convictions related to the illegal diversion and fraudulent activity remained intact. The case underscores the significant role that chemical regulation plays in combating illicit drug production and the serious consequences faced by those who attempt to circumvent these controls for financial gain. The investigation highlights a pattern of intentional deceit and a blatant disregard for laws designed to protect national security and public health.

Key Facts

Defendant: Dov Shellef
Crime: Illegal diversion of CRC-113 for methamphetamine production
State: New York
Year: 2006 (sentence finalized)
Statutes Violated: 18 U.S.C. 1343 (Fraud), 18 U.S.C. 1956(a)(1)(A) (Racketeering), 18 U.S.C. 371 (Conspiracy), 26 U.S.C. 7201 & 7206(1) (IRS Violations)
Penalties: 60 months incarceration, 36 months probation, $5,300 special assessment (originally 70 months and restitution, later amended).
Co-conspirator: Rubenstein, sentenced to 18 months incarceration, probation, fines, and joint restitution.
Destination of diverted chemical: Illicit methamphetamine manufacturing in Mexico.

GrimyTimes will continue to follow this case and report on any further developments.

Source: EPA ECHO Enforcement Case Database

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