Cigarette smuggler sentenced

PROVIDENCE, R.I. (AP) -- A Massachusetts man was sentenced Thursday to spend a year in a halfway house as part of a five-year probation term for his role in bringing millions of contraband cigarettes into Rhode Island.
The sentence was imposed on Mohamad Mohamad, a 35-year-old Syrian national living in Cambridge, Mass., after a Rhode Island tax official implored a federal judge to send a message to cigarette smuggling networks that he says engage in a "cat and mouse game" to bilk the system.

"This is not a game. This is not a joke," said Bernard Lemos, deputy chief of legal services for the state Department of Revenue. "This is a crime."

Mohamad must report to the Coolidge House in Boston on July 19. He was also fined $5,000.

Prosecutors said Mohamad bought cigarettes from southern states with low cigarette taxes to sell in Rhode Island where the tax is $3.46 per pack.

He pleaded guilty in February to trafficking in contraband cigarettes. Under a plea agreement, he admitted he had nearly 3 million contraband cigarettes worth more than $505,000 in taxes when he was arrested in November.

Assistant U.S. Attorney William J. Ferland sought prison time, calling the "kingpin" of a cigarette smuggling ring.

Defense attorney John E. MacDonald asked for probation. He described Mohamad as a hardworking man who came to the United States legally in 2000.

MacDonald said Mohamad was tortured by a government official in Syria at age 14 for striking someone's motorcycle with his bicycle. He said Mohamad's arms are permanently disfigured because of the torture.
"Mr. Mohamad is going to leave this courtroom with a felony conviction that's going to scar him for life," MacDonald said.

U.S. District Court Chief Judge Mary M. Lisi described Mohamad's operation as sophisticated and said she believed he did it to line his pockets, rather than to support his family.

"What you were looking for was to make a quick buck," Lisi said.

Rhode Island investigators described the operation as the largest cigarette smuggling ring in state history and seized more than 168,000 cigarette packs in Rhode Island, Virginia and South Carolina over two days in November.

Four convenience store operators are also facing still-pending charges in state court on accusations they resold contraband cigarettes. There were 15 convenience stores cited for selling contraband cigarettes in connection to the investigation into Mohamad, Lemos said.

At the time of Mohamad's arrest, state tax officials estimated the scheme cost Rhode Island about $5.7 million in tax revenue.

Lemos described cigarette smuggling networks as intricate operations, saying participants tip each other off after learning of investigations and use hidden compartments in their stores to hide contraband cigarettes.

State police started investigating Mohamad in December 2010 after getting reports that he was engaging "suspicious activity" at odd hours at a storage unit he rented in Warwick.

Authorities began watching Mohamad, tracking him during trips to North Carolina, South Carolina and Virginia, according to an affidavit prepared by U.S. Department of Homeland Security Agent Joseph A. Sullivan.

Investigators observed him driving in rented cargo vans and visiting stores that sold cigarettes, including a Wilson, N.C., business that sold cigarette tax stamps, the affidavit said. In some cases, investigators witnessed Mohamad leaving stores with black trash bags filled with unknown materials, Sullivan wrote.

Authorities also gained access several times to Mohamad's Warwick storage unit with a "covert entry" warrant, Sullivan wrote. The warrant did not permit investigators to seize evidence, but they did note finding as many as 120,000 cigarette packs during one visit and locating 4,800 fraudulent tax stamps on another occasion, the affidavit said.

Officials also learned Mohamad rented storage units in Rocky Mount, N.C., and Columbia, S.C., Sullivan wrote.
Mohamad became emotional as he apologized in court.

"I'm very sorry for having made this stupid choice. I brought shame to myself, to my wife, to my young daughter," he said.