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The six defendants paid for the cigarettes in one instance with a Mercedes Benz and in another with a shotgun and a box truck, a federal complaint says.
U.S. Attorney Paul Fishman said the crew “used a business model that dodged millions in taxes at the expense of the public.:
“This is a crime that affects local economies through the loss of state tax revenue and puts a massive burden on legitimate tobacco retailers,” said Mathew Horace, who heads the Bureau of Alcohol, Tobacco, Firearms and Explosives’ Newark Field Office.
Federal agents in September 2010 began investigating the operation, in which the crew resold contraband cigarettes that didn’t have a legitimate N.J. tax stamp for $27 a carton, Fishman said.
Over the following 17 months, undercover agents posing as customers bought 253,741 cartons of cigarettes for $9.68 million, resulting in a tax loss of $6.85 million, he said.
The defendants also sold the contraband cigarettes at retail stores they owned in South Jersey.
“One of the undercover officers also saw employees of the Paulsboro store selling individual cigarettes outside a pack, which is against the law,” Fishman noted.
Besides potential criminal penalties, the government is looking to seize all of the property involved, including the store.
Fishman credited the ATF, FBI, the New Jersey Department of Treasury Division of Taxation Office of Criminal Investigation, and the New York State Department of Taxation and Finance Criminal Investigation Division for their roles in the investigation.
He also cited Immigration and Customs Enforcement’s Homeland Security Investigations, the Cumberland County Prosecutor’s Office, and the Millville, Egg Harbor Township, Atlantic City and Bridgeton Police Departments.
Handling the case are Assistant U.S. Attorneys Diana V. Carrig and Howard Wiener of the U.S. Attorney’s Office Criminal Division in Camden.
Those arrested and charged in Cumberland or Atlantic counties with conspiracy to obtain and sell contraband cigarettes:
Melido Fortuna, 34, and his brother Jose Fortuna, 29, of Camden;
Muhammad Shafique, 41, and his son, Kamran Khalid, 22, of Egg Harbor Township;
Wael Kasharmeh, 38, of Gibbstown;
Mohammad Rafiq, 62, of Atlantic City.
Shafique, Rafiq, and Khalid also are charged with conspiracy to commit money laundering for allegedly using criminal proceeds to make additional illegal purchases.
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