Prosecutors allege that Sylvia Hofstetter was a frontwoman for a $17.5 million operation that handed out an estimated 12 million prescriptions over a four-year period. At least seven overdose deaths have been tied back to the operation.
Hofstetter is originally from South Florida. Records link her to addresses in Broward, and this Facebook page says she is originally from Key Biscayne. The state says that after being involved in similar businesses in South Florida, Hofstetter relocated to East Tennessee in 2011, after Sunshine State officials began cracking down on pill mills.
There is a big market for narcotics in Tennessee. Huge numbers of people from that region had trekked to South Florida clinics for easier-to-get prescriptions in the early 2000s, when pill mills thrived here. "We know, from interaction with law enforcement down there, that Tennessee license-plate tags were frequently the most observed state tags in the parking lot on drug surveillances," a U.S. attorney told a judge at a recent hearing.
Hofstetter allegedly ran multiple clinics that focused on pain relief and had on staff doctors who prescribed narcotics. Feds say that some of the clinics took only cash — a typical visit cost patients $350 — and served up to 100 addicts a day, while others were more legitimate and took insurance. Hofstetter, they say, was backed by a group of guys she and others referred to as "the Italians." Three South Floridians — identified by prosecutors (but not yet charged) as Luca Sartini, Luigi Palma, and Benjamin Rodriguez — allegedly financed Hofstetter's operation in and around Knoxville. Prosecutors have suggested the men were tied to organized crime.
Whoever was fronting the money, the Tennessee business did extremely well. "In a few short years, she went from a very modest income for South Florida terms to richer beyond probably her wildest dreams, with a lifestyle to match," a U.S. attorney told a judge at the same hearing. Hofstetter was living in a 3,400-square-foot house, and she was known around the neighborhood for her over-the-top Christmas decorations and lavish parties.
The Chattanooga Times Free Press quoted Assistant U.S. Attorney Tracy Stone as having said in court Friday, "This, in terms of scale, there is nothing that compares. I really believe this is the largest drug dealer to ever step foot in the courts of the Eastern District of Tennessee."
Hofstetter is facing federal charges of drug trafficking, money laundering, and money laundering conspiracy. She is awaiting trial.