Share and Follow
A California man linked to a notorious underground biolab has been convicted by a federal jury for masterminding a multimillion-dollar fraud scheme involving COVID-19 testing, officials announced.
Jia Bei Zhu, a 64-year-old Chinese national, faced a two-week trial in Sacramento and was found guilty on all 12 charges, which included conspiracy, wire fraud, the distribution of misbranded medical devices, and providing false information to the Food and Drug Administration, as reported by the U.S. Attorney’s Office.
According to prosecutors, Zhu operated through his Fresno-based firm, Universal Meditech Inc. (UMI), to distribute over a million defective COVID-19 test kits nationwide, amassing nearly $4 million during the pandemic’s peak.
“This verdict ensures accountability for actions that took advantage of a public health emergency for personal profit,” commented U.S. Attorney Eric Grant. “The defendant intentionally misled the public by selling inferior, foreign-manufactured test kits when accuracy and dependability were paramount.”
In addition, the Department of Justice has filed more charges against Jia Bei Zhu, 62, who runs the Reedley Bio-Lab, along with his associate. (KMPH)
Authorities say the tests were falsely marketed as FDA-approved, made in the USA and produced in certified laboratories — claims that prosecutors say were entirely fabricated.
According to evidence presented at trial, Zhu and his associates imported cheap COVID-19 tests from China, then repackaged and resold them under false pretenses. Many of the kits were missing basic components and, in some cases, did not work at all, victims testified.
Employees told jurors they were instructed to lie to customers and feared retaliation if they refused. Many of those workers had no medical or scientific background and were recruited from unrelated jobs, including retail and childcare.
Federal investigators say the operation was driven by deception at nearly every level, from misleading online marketing to false claims made directly to regulators.
“The defendant’s scheme … undermined public health during a critical time,” said FDA Special Agent in Charge Robert Iwanicki.
Zhu had previously drawn national scrutiny over his connection to a now-shuttered warehouse in Reedley, California, described by officials as an illegal, makeshift biolab that raised alarms about potential biohazards.
Inside the Chinese-linked biolab in Reedley, California, where a leak occurred. (KMPH)
The Reedley facility previously drew scrutiny after local and federal officials found lab materials, mice and improperly stored substances, though officials later said the materials tied to this case did not pose a risk to humans.
However, authorities emphasized that the criminal charges in this case were not directly tied to the biological materials found at that site. Federal agencies, including the FDA, CDC and FBI, ultimately determined the materials were part of a failed attempt to manufacture COVID-19 tests and did not pose a threat to the public.
Prosecutors said UMI’s Fresno facility itself lacked the ability to manufacture COVID-19 tests and was described as an unsanitary warehouse that fell far below established standards.
Lab equipment with Mandarin writing is seen in a biolab located in Fresno, Calif. (KMPH)
Zhu’s alleged romantic and business partner, Zhaoyan Wang, was also charged but fled the United States before his arrest and remains a fugitive believed to be in China.
Prosecutors say the pair attempted to dodge scrutiny by relocating their operation and rebranding the company under a new name, but the effort failed as federal investigators closed in.
In one instance, Zhu allegedly lied to federal agents about his identity, claiming to be a different person who had recently arrived in the U.S.
Zhu is scheduled to be sentenced in August and faces decades in prison if given the maximum penalties. Each wire fraud charge alone carries up to 20 years.
Federal officials say the case underscores their commitment to cracking down on pandemic-related fraud.
“Our office remains committed to prosecuting those who endanger the public through fraud,” Grant said.