Guaranteed Returns, a Holbrook company that manages the returns of...

Guaranteed Returns, a Holbrook company that manages the returns of pharmaceutical products, announced that Paul Nick, seen at the company's facilities on Dec. 4, 2014, has replaced Dean Volkes as president and chief executive. Credit: Newsday / Thomas A. Ferrara

Guaranteed Returns, a Holbrook company that manages the returns of pharmaceutical products, has replaced a top executive named in an alleged $116 million fraud.

The company, which denies any wrongdoing, said Thursday that Paul Nick, 54, of Hauppauge, has replaced Dean Volkes, 51, of Port Jefferson, as president and chief executive.

Volkes resigned after federal prosecutors in Philadelphia accused him, two colleagues and the company in October in a scheme involving the fraudulent siphoning off through shell companies of refunds for unused drugs returned to manufacturers. The refunds were due the original purchasers -- government agencies and private companies -- of the drugs.

Nick, a certified public accountant, has been the company's controller since joining Guaranteed Returns in 2010. Elements of the alleged scheme began at least as far back as 1999 and continued at least until April 2011, according to an indictment.

In a statement last month the company said: "The allegations brought against the company are not true, and the company looks forward to its day in court, where it believes it will be exonerated of all charges."

In a statement Thursday Nick said, "We are reaching out to all of our clients and customers to assure them Guaranteed Returns is moving forward in all of the right ways and will continue to serve its base with high standards and high quality."

Thursday's announcement said Nick's appointment is expected to be followed by other top managerial changes in coming weeks.

Also facing federal charges are Donna Fallon, 50, of Miller Place, who was the company's executive vice president and chief financial officer, and Ronald Carlino, 66, of Deer Park, who worked on the company's computer systems. All three defendants are free on bond. They and the company itself have pleaded innocent in U.S. District Court in Philadelphia to charges that include conspiracy, obstruction of justice and lying to federal agents.

Victims of the alleged scheme included the Defense Supply Center in Philadelphia, which buys drugs for the armed forces, the federal Department of Veterans Affairs, the District of Columbia Department of Health, the Federal Bureau of Prisons and numerous hospitals, pharmacies and long-term care facilities.

Businesses such as Guaranteed Returns are supposed to help organizations navigate the complex policies that drug manufacturers set up for buyers to obtain refunds on unused drugs, officials said.

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