Thursday, July 31, 2014
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Sacramento – Two Los Angeles men were sentenced on July 19 for defrauding the State of California of more than $1 million in state tobacco excise taxes, announced Chairman Jerome E. Horton of the California State Board of Equalization (BOE). 

 

The two men, Atif Henan, 59, of Los Angeles, and Samy Girgis, 60, of Norwalk, partners in, Classic Wholesale, a licensed Los Angeles tobacco distributorship were sentenced by U.S. District Judge John A. Mendez to 27 months and 21 months in prison respectively for their roles in the tax fraud scheme.

 

“Every year California loses billions of dollars to tax fraud and illegal operators who make up the underground economy,” said Horton. “These criminals deprive the state of money that could be spent on schools, public safety, hospitals and other essential services.”

 

This case was investigated by a special task force consisting of the State Board of Equalization (BOE), California Attorney General’s office, U.S. Attorney’s Office and the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives.  

 

“We are fighting back by working closely with law enforcement and other agencies to investigate and prosecute criminals as well as sound the alarm about the damage the underground economy is doing to California,” said Horton.

 

In 2007, the BOE estimated the State lost approximately $90 million in unstamped tobacco excise taxes to contraband distributors, and approximately $120 million in excise taxes for taxed stamped tobacco like cigarettes. 

 

The BOE is partnering with Senator Curren D. Price Jr. on SB 1185 to reduce criminal activity and level the playing field for California businesses by creating a Centralized Intelligence Partnership (CIP).  It would create a central location for the BOE, the Franchise Tax Board and the Employment Development Department to share information aimed at investigating, exposing and prosecuting illegal operators as well as creating a statewide evasion hotline for the public to anonymously report illegal activities.

Category: News


 

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