Owner takes Fifth in Senate 'miracles' probe

WASHINGTON (CNN) -- A businessman pardoned by President Clinton for mail fraud invoked the Fifth Amendment and refused Monday to testify before a Senate committee investigating whether his multi-million-dollar dietary supplement company markets "blatantly false" products to senior citizens.

The company, G.B Data Systems Inc., is owned and operated by Almon Glenn Braswell, who was pardoned in January by Clinton for a 1983 conviction on mail fraud related to a hair-loss product.

Braswell, appearing with his attorney, refused to answer any questions posed by Sen. John Breaux, chairman of the Senate Special Committee on Aging.

Earlier, the former chief executive officer with Braswell's company testified that its products -- which promise miracle cures -- are "laden with lies and deception," and he faulted government regulators for doing little to stop the practice.

Mike O'Neil, the former top financial executive at the California-based company, described for the Senate panel a company that preys on the elderly. He talked about a monthly advertising vehicle -- the Journal of Longevity -- that portrays itself as a medical magazine, but is chock full of articles written by company employees with no medical expertise.

He said the company generates an estimated $200 million a year in profits.

"The ads contain outright false statements," said O'Neil, adding that the company is under IRS investigation. "The ads and articles routinely toss phrases around such as: 'thousand of doctors have praised whatever product and millions of men use whatever product,' which are blatantly false.

"One product claims to improve memory, sex drive and reduce chances of heart attacks by 83 percent," he continued. "The articles routinely describe medical problems as life-threatening, potentially deadly, causing severe illness or death. They are described to scare, threaten the reader into purchasing the antidote or at least try the product for $29.95."

Sen. John Breaux (D-Louisiana) shows the ads he says are targeted at the elderly.

O'Neil has not been charged with any wrongdoing, but he said he and another former colleague reported Braswell to various government agencies after they were terminated by Braswell. O'Neil worked for the company for five months before his firing in 1999. During that time, he said he and another colleague tried to get Braswell to clean up his advertising practices, but he refused to change.

Breaux, D-Louisiana, said greater scrutiny of such companies is needed, although he shied away from calling for any new government regulations.

"People have been searching for the fountain of youth ever since Ponce de Leon, and will probably continue to do so for decades and generations into the future," Breaux said. "Our job at this hearing is not to kill that hope and desire to remain youthful and healthy as long as possible, but rather the role of the committee is to try and help protect American citizens, particularly the elderly, who are preyed upon by modern-day snake oil salesmen."