Howard Mora, 67, of Westbury, NY, and Alan Buxbaum, 65, of Monroe, NJ, were arrested and arraigned Tuesday on federal felony charges stemming from a 3-year scheme to sell beef misbranded as “Prime.” At the time, they were being featured on reality TV.
For fans of such reality shows, Mora and Buxbaum might be familiar names. Their Brooklyn beef business was the topic of season two, episode two of CNBC’s “The Profit,” hosted by Marcus Lemonis.
Mora and Buxbaum ended up in a financial dispute with Lemonis about the purported sale of the “Brooklyn Burgers” brand. Lemonis is a self-described “seasoned businessman and entrepreneur” who typically makes an offer to buy some percentage of the featured business.
The episode aired on March 4, 2014. Two months later, Lemonis sued Mora and Buxbaum, claiming he’s paid $190,000 to them, but they were refusing to turn over rights to “Brooklyn Burgers.” They countersued for $1 million, claiming defamation. It flared in the courts for a year before the parties settled out of court.
It began more cordially.
“Alan came out and shook Marcus’s hand. Alan explained that he shares the business on a 50-50 basis with his partner Howard. Howard told him that their overhead for just the rent and cooling the building cost over $62,000 per month. Even though the business was on track to make $50 million in revenue, they were still facing losing about $400,000. Howard explained that there was between $800,000 and $900,000 in inventory at any given time. Every day, $150,000-$200,000 leaves the building. Alan told Marcus that they had about $3.5 million in debt to the bank.”
That introductory meeting came at roughly at the time when the counterfeit stamp scheme was ending.
A federal court in Brooklyn on Sept. 24 unsealed the new indictment naming the pair for conspiracy to commit wire fraud. The U.S. Attorney’s Office for the Eastern District of New York accuses Mora and Buxbaum of using counterfeit USDA stamps to misbrand “Choice” beef products for more expensive “Prime” cuts.
The defendants owned A. Stein Meat Products in Brooklyn and carried out the beef-fixing scheme from September 2011 to October 2014, according to the indictment. A. Stein Meat Products was a wholesale meat processing and distribution business.
Mora and Buxhaum allegedly purchased beef that USDA had graded as “Choice” and then directed their employees to use counterfeit stamps to change the grade of the products to “Prime.” They would then sell the beef at inflated prices throughout the New City metropolitan area.
“Customers and consumers are entitled to get what they pay for, especially when the product is food on their tables,” said U.S. Attorney Richard P. Donoghue for the Eastern District of New York. “This office and our law enforcement partners will remain vigilant in enforcing laws that ensure the grade and quality of food products.”
If convicted, maximum sentences for the two men could each be 20 years in federal prison. The U.S. District Court has scheduled a status hearing on the case for October 21.
USDA’s Office of the Inspector General (OIG) led the investigation that led to the filing of the indictment.
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