U.S. Indicts 43 of Cigarette Trafficking, Banking Fraud, Money Laundering
Virginia police announced Friday the indictment of 43 people on more than 743 charges after a two-year, multi-agency investigation into cigarette trafficking, banking fraud and money laundering.
according to the Richmond Times-Dispatch.Authorities said the ring created 29 fake businesses in Virginia, which they used to buy around 600,000 cartons of tax-exempt cigarettes in bulk, worth US$ 30 million,
They then sold the cigarettes on the black market in regions like New York City, where high taxes make illicit smokes a relative bargain.
The investigation began in January 2015, when a bank in Fairfax county reported to local police that a group of 12 to 14 people were engaged in "check kiting" - the act of intentionally writing checks from accounts with no available funds.
Fairfax police then discovered that the suspects were committing fraud at nine banks across the region creating losses of more than US$ 620,000.
When detectives set up a joint operation with the FBI’s Organized Crime Squad, they eventually uncovered the sprawling cigarette smuggling operation with over 150 suspects across multiple states, the Washington Post reported.
"It’s got to be one of the largest organized crime groups we’ve had," Fairfax County Police’s Thomas Harrington said, according to the Washington Post. "It is an extremely complex case."
The group used credit cards to rent cars, but withdrew money from their bank accounts before the transaction was completed, preventing rent-a-car companies from collecting the due payments.
Police found some of the rental cars abandoned in New York City and in Virginia. Others were stopped in transit, revealing that the suspects were using them to smuggle cigarettes up the East Coast.
Most of the suspects are originally from Mauritania, with others from Morocco, Egypt and Iraq, the Richmond-Times Dispatch reported.
Some of the proceeds were allegedly used to purchase high-end vehicles, but police say it remains unclear what much of the money was used for.
"When money is being laundered in the U.S. and we don't know where it's going, obviously, that's one of the things we're going to look into: Terrorism," Harrington said.
Henrico County Police started looking into cigarette trafficking in late 2015 because they found that it was related to a number of robberies, shootings, carjackings and burglaries, police said.
Of the 43 suspects indicted, 19 have been arrested. The rest remain at large.