The Department of Justice is alleging that the Los Angeles offices of Interscope Records, home to such artists as U2, Lady Gaga, Eminem, No Doubt, and Sheryl Crow, was used by members of a narcotics ring for pick-ups and deliveries. Interscope, helmed by "American Idol" mentor/producer Jimmy Iovine, is owned by Universal Music Group.

A year-long Drug Enforcement Administration investigation, which included detailed shipping records for cases used to allegedly transport kilos of cocaine and $1 million in cash, led to the indictment of music executive James Rosemond, according to The Smoking Gun. Czar Entertainment CE) Rosemond, who also manages Interscope artist The Game, is being held without bail in a Manhattan jail. He was indicted on 18 felony charges.

The Smoking Gun reports that a number of former Rosemond associates have confessed to their role in the narcotics ring, admitting that they picked up the cases full of cash and/or cocaine at Interscope or a number of recording studios. The shipments, via a company called Rock-It Cargo, went from Los Angeles to New York, and would then be distributed from there.

According to the U.S. District Court filing,   Rosemond “disguise(d) these shipments as legitimate freight that was ostensibly needed by the performance artists he managed.”

UPDATE: Universal Music Group has released the following statement: “The information being reported in the press regarding Interscope Records’ involvement with the ongoing criminal prosecution of James Rosemond is both erroneous and completely unsupported.  Interscope Records has been informed by the United States Attorney's Office for the Eastern District of New York that there is no evidence that any employee of UMG or Interscope Records had any involvement in the drug trafficking ring being prosecuted by that office, nor any knowledge of the contents of any of the packages that were purportedly shipped to its offices.  Further, neither UMG nor Interscope Record is a subject or target of the investigation.  UMG and Interscope will continue to cooperate with the United States Attorney's Office regarding this matter."

In a statement, Rock-It Cargo said: "Rock-It Cargo is neither the subject of the investigation, nor implicated in any way. The Company has provided the U.S. Attorney with all of the documentation it has requested.As a global freight forwarding and logistics company, Rock-It Cargo has always been and continues to be strongly committed to maintaining the highest levels of transportation security. With regard to the current investigation, the Company followed all of the government’s and its own required procedures and remains in compliance with all Federal and state regulations.