1-11-2023 2:38pm

San Fernando Valley Man Pleads Guilty to Selling Used and Counterfeit Medical Devices

Anita Johnson-Brown Editor

LOS ANGELES – Kambiz Youabian, 49, a resident of Tarzana pleaded guilty, on January 9, 2023, to federal criminal charges for running a nearly $6 million scheme, in which Youabian knowingly sold used skin-tightening, medical instruments that were intentionally misbranded as new, as well as counterfeit devices, that he declared were to be used with fat-reducing laser machines.

Youabian pleaded guilty to two counts of, mail fraud and introducing a misbranded medical device into interstate commerce.

According to the defendant's plea agreement, Youabian owned and operated MSY Technologies Inc., a West Los Angeles-based company that did business under the names “Thermagen” and “Global Electronic Supplies” (GES).

From March 2016 to June 2022, Youabian bought used transducers, medical devices used by dermatology patients to tighten the skin, by delivering ultrasound energy to a patient’s dermis. Transducers are designed to provide no more than 2,400 treatments if appropriately used.

After 2,400 treatments, are reached, the devices are considered depleted and should be disposed of per health code regulations.
Youabian purchased depleted transducers through GES, for nominal sums, typically $50. The defendant then remanufactured the depleted transducers and added fabricated serial numbers to make the transducers look like the devices were new.

Then, through his Thermagen company, Youabian fraudulently marketed and sold, the devices for much more than he paid for them, the remanufactured transducers were sold to healthcare providers and customers as “new” transducers with 2,400 remaining skin-tightening treatments.

To conceal his connection to Thermagen, Youabian used names of fabricated Thermagen workers in correspondences with victim providers and used out-of-state commercial mailboxes for Thermagen’s return of address on shipments, which he sent through the U.S. mail.
"For example" in February 2020, Youabian, through Thermagen’s website, sold a device falsely advertised as “new” and “containing 2,400 lines” – and with a retail price of $1,695 – to a buyer. Youabian then shipped the device – which contained a fake serial number – from Los Angeles to Florida via the United States Postal Service.

In the mail order scheme, The defendant also shipped counterfeit PAC keys, medical devices used to operate laser machines designed to reduce fat in patients, through the mail.
Youabian then transferred the money to a bank account he controlled, including accounts he opened in the names of MSY Technologies, himself, and his au pair, a helper from a foreign country who works for and lives as part of, a host family.

In June 2022, law enforcement executed search warrants at Youabian’s home and the GES-Thermagen office in West Los Angeles.

In the GES-Thermagen office, Law enforcement officials located and seized 75 transducers in various states of refurbishment, a manufacturing workstation containing tools and transducer parts, and detailed records of GES and Thermagen’s expenses.

Youabian admitted in his plea agreement to unlawfully selling thousands of medical devices, including transducers and PAC keys, and receiving at least $5,821,474 in fraudulent proceeds that should have been paid to the companies that are the sole U.S. distributors for these devices. The defendant also confessed he caused reputational harm to the device manufacturers and distributors of these medical devices.

United States District Judge Dale S. Fischer scheduled a June 26 sentencing hearing, at which time Youabian will face a statutory maximum sentence of 23 years in federal prison.
The U.S. Food and Drug Administration Office of Criminal Investigations and the United States Postal Inspection Service investigated this matter.

Assistant United States Attorney Gregory D. Bernstein of the Major Frauds Section is prosecuting this case.

This Article was updated by Anita Johnson-Brown