Feds: $17.5M Tennessee Prescription Pill Ring Unprecedented

March 17, 2015

Federal prosecutors say a 51-year-old woman recently arrested in a prescription pill sting was running one of the biggest illegal drug networks east Tennessee has ever seen.

Prosecutors were in federal court Friday in an attempt to keep Sylvia Hofstetter in jail ahead of her trial. The 51-year-old is facing charges she headed a $17.5 million pill-mill operation in Knoxville and Lenoir City. She was indicted on nine federal charges.

“This, in terms of scale, there is nothing that compares,” Assistant U.S. Attorney Tracy Stone said in court. “I really believe this is the largest drug dealer to ever step foot in the courts of the Eastern District of Tennessee.”

U.S. Magistrate Judge Clifford Shirley declined to free Hofstetter while she awaits trial, The Knoxville News Sentinel reported.

Defense attorneys had argued that the grandmother has no criminal record.

Hofstetter was arrested on March 10, the same day federal raids were conducted at pill clinics in Lenoir City.

A federal task force has been targeting the operation for at least two years, sending agents to pose as patients. The investigation went public last week with a series of raids on clinics in Knoxville and Lenoir City. Hofstetter was arrested and jailed that day, along with more than 50 others.

In 2011, Hofstetter moved from Florida to West Knox County.

The FBI says the clinics managed by Hofstetter charged roughly $350 cash per visit, saw 100 patients a day and gave out 12 million prescriptions in four years.

Seven patients of the clinics have been identified as fatal overdose victims.

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