How a Family of Scammers Made Millions Off Fake 5-Hour Energy

Counterfeit energy drinks were lightning in a bottle for Adriana and Joseph Shayota, netting them a million dollars a month until the feds closed in. But they had one chance to clear their name: President Donald Trump.

The view from Adriana and Joseph Shayota’s 7,300-square-foot ranch-style home in El Cajon, California, was once that of a small empire. Below the rolling hillside town and roughly 28 miles from the edge of their infinity swimming pool stood the Shayota goldmine — an unassuming gray and white warehouse near the U.S.-Mexico border with a small sign that read “Baja Exporting” in medical-blue type. Starting in 2010, the mostly windowless compound was the manufacturing and distribution hub for a burgeoning million-dollar-a-month business venture: the sale of counterfeit 5-Hour Energy.

By every account, Joseph, a 68-year-old first-generation Chaldean immigrant, was quite dapper. His eight-car garage was filled with three Range Rovers, two Mercedes, a Ferrari and a Bentley. According to court records, Joseph had a gambling problem and spent his days in casinos or hanging out in cigar shops. For a time, he also had an affair with a young woman who was living in an apartment that was listed under Adriana’s name. Unlike her husband, 49-year-old Adriana, a Catholic with Mexican ancestry, worked in the distribution office every day, according to Geoffrey Potter, a lawyer with Patterson Belknap Webb & Tyler and lead prosecutor of the case against the Shayotas. “She masterminded getting this stuff out there,” he says.

Prior to their 5-Hour Energy scheme, the road to counterfeiting royalty was, for the Southern California-based couple, paved with other, less-spurious scams. In early 2009, the Shayotas, along with their co-conspirator Walid Jamil and other members of their family, resold counterfeit Equal, Splenda, Truvia, Uncle Ben’s Rice, Monster Energy drinks, Mars candy and Welch’s and Mott’s products.

Their budding arrangement cast Jamil as the head of the distribution side of the business while the Shayotas put up the capital. Their distribution factory, Midwest Wholesale, was based outside of Detroit. But that all changed a year later in 2010 when the Michigan Department of Agriculture received complaints of a rat infestation inside Shayota HQ. The rodents were attracted by knockoff rice that was then poured by hand into counterfeit Uncle Ben’s boxes. Still, no criminal or civil charges were brought.

Soon after the incident, the decision was made to move the operation to San Diego — closer to the Shayotas’ home and conveniently near the border. Ironically, the 5-Hour Energy operation began as a legitimate one. In late 2009, under the name Baja Exporting, the Shayotas entered into an agreement with Living Essentials, the parent company for 5-Hour Energy supplements. Baja Exporting was authorized to distribute 5-Hour Energy in Mexico, which they received at a 40 percent discounted rate so that they could help introduce the energy drink to an untapped market.

But a few months passed, and the Shayotas — who’d purchased more than 350,000 bottles of 5-Hour Energy with Spanish labels — hadn’t sold a single one. Potter tells me he doesn’t think the family ever had any intention of selling the products in Mexico; court filings suggest that Joseph tried to divert the product into the U.S. marketplace but failed because retailers didn’t want bottles with Spanish-language packaging. That’s when the Shayotas conspired [ … ]

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dodo bird
30 days ago

Who drinks this piss-water anyway? You have to be nuts.

larry laughs
30 days ago

China counterfeits all the time but nobody ever prosecutes them … or goes after President Xi.

toast
30 days ago

It’s sick how journalists turn every news item into a diatribe against former President Trump.

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