Calif. Man Indicted For Hawking COVID-19 Cure To Investors
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Law360 (June 15, 2020, 4:08 PM EDT) — A grand jury has indicted a California man on fraud charges for allegedly promising “enormous returns” on investments in bogus treatments for COVID-19, following an earlier criminal complaint that federal prosecutors said was the first to come out of the pandemic.
Keith Lawrence Middlebrook was arrested by an undercover FBIagent on March 25 and charged that day with attempted wire fraud in a one-count criminal complaint, which was replaced on Friday with an 11-count indictment.
The indictment alleges he used social media, emails and text messages to fraudulently solicit investments in companies that would purportedly market and develop immunity pills and an injectable cure for coronavirus.
Beginning no later than March 13, Middlebrook began posting on Instagramand YouTubethat he had developed “patent-pending” COVID-19 treatments, and that investors could buy “risk-free” and “100% guaranteed” shares of his purported companies, Quantum Prevention CV Inc., or QP20, and Quantum Cure CV 2020 Inc., also known as QC20.
Middlebrook claimed his pills could prevent people from contracting coronavirus and that his injectable serum could cure an infected individual within two to three days, or even in as little as 24 hours, according to the indictment.
National and international health organizations have said there is no known cure, vaccine or other preventative treatment for the novel coronavirus as of yet, and prosecutors say that Middlebrook’s purported patents and corporations do not exist.
According to the earlier criminal complaint, Middlebrook had 2.4 million Instagram followers as of March 24 and 13,600 YouTube subscribers as of March 23. His coronavirus cure videos on the two platforms had been viewed over 2 million times by the time of his arrest, prosecutors said. Both social media accounts have since been deleted.
Middlebrook also communicated via text message and email directly with prospective investors in Nevada, Colorado, Florida, New York, Texas and California, the indictment alleges.
In an effort to make the enterprise appear legitimate, Middlebrook allegedly made a series of false claims: that former basketball star and current businessman Magic Johnson was involved with QC20, that an unidentified party in Dubai had made a $10 billion offer for the two companies that would secure any investment and that Middlebrook had already received seven investments of between $750,000 and $1 million each.
The FBI arrested Middlebrook after he delivered the “preventative” pills to an undercover agent posing as a prospective investor, prosecutors said. Middlebrook told the disguised agent that an initial investment of $300,000 would guarantee a return of $30 million, according to the March 25 complaint.
Two of the charges in Friday’s indictment stem from his alleged communications with the FBI agent, court records show.
The government has not alleged “at this point” that Middlebrook ever actually collected any investment funds, a DOJspokesman said Monday.
Middlebrook was in custody from his arrest until May 6, when he was released on a $150,000 bond, prosecutors said. His arraignment on the indictment has yet to be scheduled, according to the DOJ.
Counsel for Middlebrook told Law360 on Monday that he will fight the charges.
The government is represented by Valerie Makarewicz and James Hughes of the U.S. Attorney’s Officefor the Central District of California.
Middlebrook is represented by Scott B. Hullinger of The Hullinger Firm.
The case is U.S. v. Middlebrook, case number 2:20-mj-01341, in the U.S. District Court for the Central District of California.
–Editing by Alyssa Miller.
Update: This article has been updated to include comment from Middlebrook’s attorney.
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