Bronx County District Attorney Robert Johnson announces multiple indictments of 20 people and six corporations containing 1345 counts regarding a major smuggling operation that brought more than 44,000 untaxed cartons of cigarettes from Virginia to the Bronx during a single five-month period in 2014 alone, the participants accused of evading more than $2.978 million in New York State and City taxes. The total maximum tax penalty, for New York City and State combined, is more than $35,768,000.
The various defendants face State felony charges ranging from Enterprise Corruption, Criminal Tax Fraud, and Money Laundering, to New York City Administrative Code violations of the Cigarette Tax laws.
After a two-and-a-half-year multi-agency investigation, 19 men and one woman were charged following simultaneous arrests Tuesday and Wednesday of this week in New York, Virginia, Connecticut and New Jersey. The Bronx County grand jury indictments were unsealed today with the Supreme Court arraignment of several of the defendants in Part 60, before Justice Steven Barrett. The following defendants are named in one or more indictment:
Abdelhalim Abusharkh a/k/a “Aboud” or “Khalid Aboud” – Bronx, NY – age 32
Nabil Ahmed Al-Jomai (“Saleh Salahaddin”) – Bronx, NY – age 33
Aiman Baira (“The Syrian”) – Piscataway, NJ – age 48
Scott Barnett – Rockville, VA – age 37
Hiyad Chaib – Bronx, NY – age 32
Moeen Khan – Henrico, VA – age 46
Edward James Kilgore – Richmond, VA – age 40
Mitch Grebler – Henrico, VA – age 52
Thierno Ly (“Ahmed”) – Bronx, NY – age 30
Mickel Marzouk (“Mike” or “The Egyptian”) – Glen Allen, VA – age 29
Denise McManus – N. Chesterfield, VA – age 52
Neya Sidi Mohamed – Bronx, NY – age 39
Bassam Mustafa – Bronx, NY – age 55
Emad Mustafa – Bronx, NY – age 28
Mohamed Mustafa – Bronx, NY – age 29
Rabih Nahle (“Connecticut” or “The Lebanese”) – West Haven, CT – age 44
Mohamed Arafat Ouldsaleck (“Arafat”) – Bronx, NY – age 38
Rabih Saba – N. Chesterfield, VA – age 39
Momadou Sow (“Ramadan” or “The African”) – Bronx, NY – age 31
Charles Wilkins (“Dennis Anderson”) – N. Chesterfield, VA – age 49
Al-Nabil 83 Deli Grocery Corp.
Al-Nabil 85 Deli Grocery Corp.
Al-Nabil 86 Deli Grocery Corp.
Al-Nabil 91 Deli Grocery Corp.
Al-Nabil 94 Deli Grocery Corp.
Express Deli Grocery of Randall Ave. Corp.
Cigarette smuggling is big business. It is estimated that, in New York State, 58% of all cigarettes sold are untaxed, and smuggled in primarily from Virginia[1]. With per pack prices topping $11 and more, bringing in untaxed cigarettes is very profitable – New York state and city taxes add $5.85 to each pack.
It is alleged in the indictment that the boss, MOHAMED MUSTAFA, headed the operation by acquiring cigarettes for distribution from Virginia, storing those cigarettes at 2118 Matthews Avenue and other locations in the Bronx, and by controlling the distribution of cigarettes to the New York City area without paying New York State or City tobacco taxes, thereby generating hundreds of thousands of dollars in illicit proceeds for himself and other members of the enterprise. His lieutenant, HIYAD CHAIB, is alleged to have assisted the criminal enterprise in all aspects of the operation, and would serve as the central contact for the employees and associates when MOHAMED MUSTAFA was away.
MOHAMED MUSTAFA and HIYAD CHAIB determined the New York-based distributors to whom they would sell cigarettes, the prices the distributors had to pay for cigarettes, and the times and locations at which the distributors would exchange money for cigarettes, it is further alleged. They also controlled the storage facilities and both of them actively answered a “business line” to collect orders and arrange deliveries. Each week, almost 2,000 cartons of cigarettes (400,000 cigarettes) would pass through the enterprise costing the state over $100,000 in tax revenue. The total tax fraud is estimated to be close to $3 million; total maximum tax penalties, if the defendants are convicted, will reach nearly $36 million.
Indictment papers also describe how MOHAMED MUSTAFA and HIYAD CHAIB originally acquired the majority of the cigarettes they distributed in the Bronx from suppliers RABIH SABA and MOEEN KHAN, residents of the Commonwealth of Virginia, who owned and managed a chain of mattress stores (“The Mattress Place”) and dollar stores around Richmond, Virginia. Indeed, RABIH SABA and MOEEN KHAN used their Virginia businesses, in part, as collection and distribution centers for cigarettes purchased in Virginia with only the low Virginia cigarette tax, and thereafter controlled the distribution of the cigarettes to the New York City area without anyone associated with the Enterprise paying New York State or City tobacco taxes for those cigarettes. They also used their business and personal accounts to transfer money from the Bronx and Manhattan to them in Virginia.
To generate said money, RABIH SABA and MOEEN KHAN are accused of forming a network of cigarette buyers in Virginia who would visit Costco, Sam’s Club, Wawa, and other retail sellers of cigarettes, to purchase cartons of cigarettes in a large enough quantity to make trafficking them to New York profitable. RABIH SABA and MOEEN KHAN arranged with MOHAMED MUSTAFA and HIYAD CHAIB for near-daily deliveries to New York. The drive to New York, delivery of cigarettes, and receipt of payment was generally handled by transporters DENISE MCMANUS and EDWARD JAMES KILGORE, according to the charges, who would collect upwards of 400 cartons of cigarettes from RABIH SABA and MOEEN KHAN and drive to meet MOHAMED MUSTAFA and/or HIYAD CHAIB at a residential location in the Bronx. Once in the Bronx, DENISE MCMANUS and EDWARD JAMES KILGORE would transfer the cigarettes and receive cash which they would either give to RABIH SABA and MOEEN KHAN or deposit into accounts controlled by them. DENISE MCMANUS and EDWARD JAMES KILGORE were paid for their work.
Besides the direct connection to Virginia provided by RABIH SABA and MOEEN KHAN, MOHAMED MUSTAFA and HIYAD CHAIB stand accused of establishing other supply lines to secure untaxed cigarettes from Virginia. One such supply line, it is alleged, was provided by supplier MOHAMED ARAFAT OULDSALECK who would contact, or be contacted by, one or both of MOHAMED MUSTAFA and HIYAD CHAIB to set up deliveries of untaxed or unlawfully-taxed cigarettes to the Bronx, often multiple times a week. MOHAMED MUSTAFA also regularly traded with supplier AIMAN BAIRA, an individual from New Jersey, who would commute to Virginia to purchase untaxed cigarettes from MICKEL MARZOUK, CHARLES WILKENS and ABDELHALIM ABUSHARKH, which he would sell to MOHAMED MUSTAFA, THIERNO LY, RABIH NAHLE and MOMADOU SOW in the Bronx.
When cigarettes were delivered to storage locations throughout the Bronx controlled by MOHAMED MUSTAFA and HIYAD CHAIB, they would generally be received by one of the two or by EMAD MUSTAFA, brother of MOHAMED MUSTAFA, or BASSAM MUSTAFA, father of MOHAMED MUSTAFA, who acted as a distributor. The indictments charge that, almost daily, MOHAMED MUSTAFA, HIYAD CHAIB, EMAD MUSTAFA, and others known and unknown, would receive orders for cigarettes via phone call or text message from delis and bodegas (hereinafter “delis”) throughout the Bronx, and would deliver cartons of cigarettes known as “reds,” “whites”, “greens,” “smalls,” “longs,” and other semi-cryptic monikers designating either brand or size. The MUSTAFA brothers, HIYAD CHAIB, and others would collect money from the various delis which they would use, in part, to pay the transporters and suppliers. The group received almost daily orders from retailer EXPRESS DELI GROCERY, as well as a group of delis – AL-NABIL 83, AL-NABIL 85, AL-NABIL 86, AL-NABIL 91, and AL-NABIL 94, controlled by NABIL AHMED AL-JOMAI, an owner, who was often observed presiding over transactions in the establishments.
The sale of cigarettes in delis generated cash which was returned, it is further alleged, to MOHAMED MUSTAFA and HIYAD CHAIB who would keep a running tally of how much each retailer owed. The Enterprise was continually infused with a percentage of the profits from the sale of the untaxed cigarettes. As mentioned, profits were also shared with the transporters and deliverers by concealing and disguising the true nature of the illicit proceeds and filtering the money through personal and business bank accounts.
Some of the proceeds were also sent to a number of the defendants’ home countries in Africa and the Middle East.
Money seized from the operation totals more than $100,000.
Operation Smoke Brake is being prosecuted by Assistant District Attorneys W. Dyer Halpern, Jessica-Deanna Lupo, and Caitlin Carroll of the Arson/Auto/Economic Crimes Bureau, which is under the supervision of Counsel to the Investigations Division Mary Jo Blanchard, Bureau Chief William Zelenka and Executive A.D.A. Thomas Leahy.
Bronx District Attorney Johnson singled out for praise the many people and agencies that cooperated with this office and helped make this case possible: the Bronx District Attorney Detective Investigators, under the supervision of Chief Frank Chiara, Deputy Chief Arthur Hall, and case Lieutenant Frankie Brumfield, and the following Detective Investigators: Lieutenants Frank Thorp and Rocco Galasso, who worked on the wire coverage; Crimes Against Revenue Program members Marie D’Angelo, Alfredo Nunez, Manuel Lara, Zahraa Majeed, and Vijesh Titus; Marco Conelli, Wilfred Melendez, Peter Moro, Daniel Clark El, Sherece Perkiss, Brian O’Loughlin and Nicholas Ranieri on Wire Coverage; and for the arrest and search warrants, all of the preceding, as well as Detective Investigators Modesto Acevedo, Moni Brahm, Michael Bunyan, Vincent Cantarella, Theresa Careswell, Daniel Donovan, Shamaine Gutierrez, Sajma Hot, John Might, Caleb Ruffo, Merybet Tavarez, Patrick Walsh and Bradford Waterman, well, former Detective Investigators Doris Amador, Roger Archer, Marvin Chalmers, and Floyd Coor.
Also singled out are the members of the Bronx D.A.’s Asset Forfeiture staff, including Cristina Paquette and Sharon Primus; the National White Collar Crime Center;investigators from the NYPD’s Intelligence Bureau, under the supervision of Chief Thomas Galati; the NYC Department of Finance, Maureen Kokeas, First Deputy Sheriff; Queens District Attorney Richard Brown, and from his office Sgt. Elizabeth A. Curcio and Detectives Jeffrey A. Boyce, Joseph Brancaccio, John J. Keely, David Matos and John R. Warner, of the Queens District Attorney’s Detective Bureau, which is under the supervision of Chief Investigator Franco Russo and Deputy Chief Investigator Robert J. Burke, and who are assigned to the District Attorney’s Crimes Against Revenue Unit, which is under the supervision of Assistant District Attorney Andrew H. Kaufman.
Also instrumental in the investigation were the New York City Sheriff’s Office; the Middlesex County, NJ Prosecutors Office; and the Henrico County, VA Commonwealth Attorney and Division of Police.
The charges in these indictments are merely accusations and the defendants are presumed innocent until proven guilty.
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