Queens County District Attorney Richard Brown, joined by New York State Department of Taxation and Finance Commissioner Thomas Mattox, announced the arrests and the seizure of more than 6,700 packs of untaxed cigarettes and nearly 4,000 counterfeit tax stamps, all of which were in their possession.
The men are identified as Carlos M. Marcelino, 40, of South Ozone Park; Sari M. Ahmed, 35, of Richmond Hill, and the store manager for Good Guys Deli, located at 102-01 Jamaica Avenue; and Sandro Balbuena, 32, of Jamaica, who claimed he was in the process of buying G&B Deli, located at 112-31 Farmers Boulevard.
The men were arraigned on November 1 and charged with first-degree criminal possession of a forged instrument, which was used to produce the counterfeit tax stamps, and violations of New York State Tax Law 1814 (Cigarette and Tobacco Products Tax).
If convicted, the defendants each face up to fifteen years in prison.
According to the Queens District Attorney, cigarette smuggling to evade state and local taxes is a multimillion-dollar industry.
“It is a highly profitable tax-free cash business for those involved in it,” he said. “However, it cheats taxpayers who must dip into their pockets to pay higher taxes. And it cheats the government as well by fueling an underground economy, which does not pay much needed state and city taxes.”
According to the District Attorney’s office, it is estimated that if left unchecked, New York State and New York City could have potentially lost $800,000 each month in tax revenues from this particular case
As part of an ongoing long-term investigation, court-authorized search warrants were executed on Tuesday, November 1, by detectives assigned to District Attorney Brown’s Crimes Against Revenue (CARU) Unit, State Tax investigators and the State Police.
The warrants allowed investigators to probe the defendants’ properties. At Marcelino’s residence, police allegedly recovered 2,961 packs of untaxed cigarettes, 3,928 counterfeit tax stamps (1,515 New York State tax stamps and 2,413 joint New York City/New York State tax stamps), two clothing irons that were allegedly used to affix tax stamps to packs of cigarette and $560 in cash.
In executing a search warrant at a Queens storage location where Marcelino had been observed the day before, police allegedly recovered an additional 3,600 packs of untaxed cigarettes.
In searching G& B Deli, the store Balbuena claimed he was in the process of buying, police allegedly recovered 106 packs of cigarettes bearing counterfeit tax stamps and one unstamped pack.
Balbuena is currently under prosecution for selling untaxed cigarettes from G&B Deli on a prior occasion.
In searching Good Guys Deli, at which Ahmed is the store manager, police allegedly recovered 67 packs of cigarettes bearing counterfeit tax stamps.
According to the District Attorney, all cigarette packages sold in New York City must bear a joint New York City/New York State tax stamp and only a licensed stamping agent can possess untaxed cigarettes and affix the tax stamp on the packages.
The arrests are the latest in the District Attorney’s CARU unit, which proactively investigates and prosecutes individuals and businesses that deliberately fail to pay tax obligations associated with legal and illegal activities.
According to the D.A’s office, more than one-million untaxed cigarettes have been seized, forfeited, and surrendered this year.