Brooklyn Prosecutors Bust Illegal Cigarette Sales Ring
Brooklyn prosecutors announced Wednesday nearly two dozen arrests in a operation designed to combat bootleg cigarette sales, which costs the city an estimated loss in tax revenue of more than a half-billion dollars per year. NY1's Michael Herzenberg filed the following report.
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It's bootlegging, but prosecutors call their latest bust "Operation Buttlegger," as in cigarette butts.
"Today we send a very direct message to tax cheats. That when your activities are uncovered, you're going to face substantial penalties," said Brooklyn District Attorney Charles Hynes.
Hynes showed off some of the hundreds of cases of cigarettes valued at more than $4 million used in a sting operation and sold under cost without taxes, having been paid to people like Marmadou Barry and Ching Chung Lam.
"Lam used $180,000 that he was carrying in a grocery bag. Barry showed up with a large amount of cash in a large, black garbage bag," said Hynes.
Hynes said many of the 23 people arrested planned to sell the tobacco at discount to stores that could jack up the prices for big profits.
"If you have this level of profit, obviously people will do whatever they can to generate this level of profit," the district attorney said.
Hynes also blamed the public for knowingly buying cheap cigarettes that obviously haven't been taxed.
"There would a guy who would buy in bulk in Virginia and sit on the stoop and sell them our of a bag and I bought them," said one local smoker.
Smokers told NY1 they cannot blame them for looking for a bargain and many said it is the government that should be penalized for taxing tobacco so much.
"It's criminal to tax something more than its total worth," said a New Yorker.
The Department of Finance says half of all cigarettes sold in the city are untaxed.
Hynes said all of Wednesday's defendants face one to 15 years in prison and substantial tax penalties. Two of them are also charged with robbery.
More arrests in connection with the case are possible.