Gabriel Letizia Jr., 72, pleaded guilty May 4 to rigging test results of consumer products at AMA Laboratories Inc. in New City, and has made a deal with prosecutors to forfeit $46.2 million and serve up to seven years in prison.
Letizia founded AMA Laboratories in 1982 to test cosmetics and drugs for safety and efficacy.
But employees working under Letizia’s direction defrauded customers from 1987 to 2017, according to the government, by testing products on fewer people than required and then producing false reports.
In 2013, for instance, a company hired AMA to test a sunscreen product. The lab report concluded that the sunscreen, when tested on 10 people, provided a sun protection factor (SPF) of 53.
“In fact, as Letizia knew, this conclusion was false,” according to a court filing, “in that the laboratory conducted its SPF testing on panels with fewer than 10 subjects, and that the report included false data for subjects who did not actually participate in the testing.”
An inaccurate SPF rating is a public safety issue in that sunscreen users rely on the number to protect themselves from the damage caused by exposure to the sun.
Now sunscreens tested by AMA and sold in Australia must be retested to confirm the accuracy of their SPF ratings, according to a recent directive from the Australian Government Department of Health.
Letizia “schemed for decades to defraud customers of his laboratory,” according to a press release from Audrey Strauss, U.S. Attorney for the Southern District of New York.
He pleaded guilty on May 4 to U.S. Magistrate Judge Paul E. Davison in White Plains to conspiracy to commit wire fraud and two counts of misbranding products.
A deal has been in the works for several months. Last November, Letizia and prosecutors signed a plea agreement calling for up to seven years imprisonment, forfeiture of $46.2 million and a fine up to $350,000. A federal judge will determine the actual punishment in a sentencing scheduled for Sept. 14.
Letizia”™s admission of guilt is in stark contrast to previous assertions of innocence.
In 2017, AMA accused the FBI and Rockland County District Attorney”™s Office of  “bad faith,” in conducting two raids that seized documents at the company”™s campus at 216 Congers Road, New City. AMA tried unsuccessfully to get a judge to stop the government from introducing that evidence to a federal grand jury.
Also in 2017, AMA sued several employees in Westchester Supreme Court, blaming them for running improper clinical trials. Former lab director David Winne responded in a court filing that Letizia was fully aware of the lab”™s practices and had “arrogated to himself” money that was supposed to be used for test panelists who were not hired.
In 2019, Winne and former lab officials Mayya Tatsene, Patrycja Wojtowicz and Kaitlyn Gold pleaded guilty to wire fraud. They have not yet been sentenced.
In 2019, Letizia proclaimed his innocence in a letter to the Westchester County Business Journal. Two weeks later, he was arrested on charges of conspiracy and wire fraud. He pleaded not guilty.
The U.S. Food and Drug Administration assisted in the investigation with the FBI and Rockland district attorney. Assistant federal prosecutors Jeffrey C. Coffman, James McMahon and Olga I. Zverovich are handling the case.
Letizia is represented by Manhattan attorneys Frederick P. Hafetz and Noah E. Shelanski.
