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Authorities Claim Local Cigarette Smugglers Have Possible Terror Ties

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Law enforcement officials announced on Thursday 16 people have been arrested for allegedly selling tax-free cigarettes in the city and are being investigated for having possible ties to Islamic groups like Hamas and Hezbollah.

The sale of illegal cigarettes brought in millions of dollars in profits over the last year-and-a-half. Authorities said Basel Ramadan is the ring leader of the operation.

"The Ramadan brothers funneled more than $55 million in cash, transported in garbage bags from New York down to local institutions in and around Ocean City, Maryland and laundered the funds to purchase more cigarettes," said state Attorney General Eric Schneiderman.

The ring is accused of buying at least 1.5 million cartons of cigarettes from Virginia wholesalers, then trucking them north. Those cartons cost less than $50 in Virginia, but in New York City, the price doubles because of higher taxes.

It is illegal to resell those cheaper cigarettes in New York, but they were sold for big profits to stores across the city as well as counties like Albany and Schenectady.

Police Commissioner Ray Kelly said some of those busted, like Youssef Odeh, who lives on Staten Island, have ties to serious terrorists.

"One of his investors was the 'blind sheik' Omar Abdul Rahman, who in the '90s apparently provided Odeh with $10,000," Kelly said.

Rahman was convicted for plotting to blow up New York landmarks.

The commissioner said Muaffaq Askar of Brooklyn was connected to a terrorist as well.

"He was the confidant of Rashid Baz. That individual was the Lebanese immigrant who fired on a van full of Hasidic students on the Brooklyn Bridge in 1994, killing 16-year-old Ari Halberstam," said Kelly.

Authorities are still investigating to see if the millions in illegal profits were used to set up a potential future attack against the city.

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