TOPEKA, Kan. (WIBW) -- Federal prosecutors laid out information about a Manhattan doctor's assets as he seeks to be released from custody as he waits for his case to proceed in the court system.
The government says illegal practices went on at Dr. Michael Schuster's clinic, Manhattan Pain & Spine, for more than five years. The clinic has been seized and will be closing at the end of the month after authorities exposed an alleged pill mill.
Last week, the 53-year-old physician was indicted by a federal grand jury. He is accused of illegally distributing prescription medications.
Schuster is charged with four counts: one count of conspiracy to illegally distribute controlled substances, one count of unlawful distribution of controlled substances, one count of unlawfully distributing controlled substances to a person under 21 years old and one count of maintaining a premises in furtherance of of unlawful drug distribution.
He pleaded not guilty to his charges during his arraignment in Topeka Tuesday. A detention hearing was also held Tuesday because Schuster wants to be released from jail as he awaits trial. In a previous hearing, prosecutors said they consider Schuster to be a flight risk due to his many assets.
Prosecutors called an FBI agent and asset forfeiture investigator with the FBI to the stand to testify about their findings in the case. They told the judge that Schuster has two passports and upwards of 30 properties in the United States, including properties in Kansas, New York, Nevada, Arizona, Alaska, Texas and New Mexico. Most of the property is vacant land.. He also has property in Argentina, Paraguay and Canada and more than $1 million in foreign bank accounts, they said. The asset forfeiture investigator said she did not know where some $400,000 went from one bank account in Canada, as documented in financial reports submitted by Schuster.
Schuster's wife, Janet Immer, meanwhile, testified that her and her husband never did anything improper with their land and they've been paying property taxes on all of their properties, which the government placed an estimated $2 million value on.
Schuster's indictment alleges that he employed unlicensed staff members who distributed controlled substances to patients using his signature on prescriptions while he was traveling out of the state or out of the country.
According to the government, their investigation found that 542 patients received prescriptions for medications including painkillers and antidepressants when Schuster was out of the office.
Schuster was arrested last week; his license indefinitely suspended and his office raided by some 30 law enforcement officers.
According to the indictment, he would pre-sign blank prescription pads that his staff would use to issue medications when he traveled.
Investigators documented various prescriptions bearing Schuster’s signature while he was on trips to Russia, South Africa, Uruguay, Canada, New York, Chile, Argentina, and Israel.
The investigation into the practices at Schuster's clinic began early in 2012 when the Riley County Police Department received reports that Schuster was issuing prescriptions for high dosages of scheduled drugs based on minimal or cursory physical examinations and allowing for "early refills" of the medications.
Authorities say as a result, several patients overdosed. The FBI spoke to several doctors on Fort Riley who reported that several active duty soldiers and their families members who died from overdoses were Schuster's patients. Fort Riley has declined to comment further on the deaths, saying only that they are cooperating with the investigation.
In his indictment it states that "from April 2007 to August 2012 Schuster knowingly maintained" his clinic "for the purpose of unlawfully distributing controlled substances."
Schuster faces a maximum penalty of 20 years in federal prison on each of his charges. If death or bodily injury results from the crime, the penalty is not less than 20 years.
The government, upon convicted, wants Schuster to forfeit any profits or property used to commit the crimes or purchased with criminal proceeds.
His detention hearing was continued until Thursday, May 9, 2013 at 2:30 so Schuster's attorney could review banking documents the prosecution is going to submit.