Feds Arrest Four in $8.5M Cigarette Scam

Four people were arrested in Berryville during a morning raid conducted by Alcohol, Tobacco and Firearms (ATF) agents on Wednesday. The arrests stem from a three-year-long investigation that Federal agents say involved millions of dollars of illegal cigarettes as well as money laundering.

Ali Mohammad Lonekashmiri (center) with wife Farhat and nephew Farman Ali were arrested on Wednesday - Photo Edward Leonard

“The defendants who were arrested yesterday have already had their initial court appearances in U.S. District Court in Harrisonburg” said Brian McGinn, Public Affairs Specialist for the United States Attorney’s Office, Western District of Virginia. “They were indicted under seal on August 3, 2011.”

According to the indictments, the defendants acquired untaxed cigarettes in the Western District of Virginia. The US Attorney’s office says that members of the alleged conspiracy paid undercover law enforcement officers approximately $8.5 million for untaxed cigarettes.

According to McGinn, three Berryville residents, along with a fourth person with an unknown residence, were arrested on charges related to selling contraband cigarettes and money laundering.

Mohammad Syed Lone Kashmiri, 47, of Berryville was charged with one count of conspiracy to sell contraband cigarettes and launder money; 98 counts of purchasing and receiving contraband cigarettes; 98 counts of money laundering-promotion; and 14 counts of money laundering-spending.

Farhat Jabeen Lone Kashmiri, 49, of Berryville was charged with one count of conspiracy to sell contraband cigarettes and launder money; 98 counts of purchasing and receiving contraband cigarettes; 98 counts of money laundering-promotion; and 14 counts of money laundering-spending.

Farman Ali, 36, of Berryville was charged with one count of conspiracy to sell contraband cigarettes and launder money; 98 counts of purchasing and receiving contraband cigarettes; 98 counts of money laundering-promotion; and 14 counts of money laundering-spending.

Malik Ashfir, was charged with one count of conspiracy to sell contraband cigarettes and launder money; 98 counts of purchasing and receiving contraband cigarettes; 98 counts of money laundering-promotion; and 14 counts of money laundering-spending.

“The indictments resulted from a three-year investigation by the United States Attorney’s Offices for the Western District of Virginia and the District of South Carolina, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Internal Revenue Service Criminal Investigations, the ICE Homeland Security Investigations and the Shenandoah County Sheriff’s Department.” McGinn said.

Clarke Daily News is continuing to track this unfolding story and will provide additional details about the case as they become available.

 

 

 

Comments

  1. Wasn’t this the guy who won the lottery not too long ago?

    • Because I Care says:

      TWO lotteries! The first was $150,000 and the second was a million a couple weeks later.

    • Because I Care says:

      So interesting to read the comments in these past articles too. Some folks were saying he wasn’t the same guy who scratched off the tickets and won at the Food Lion that day that he won a million.

  2. Because I Care says:

    This goes much deeper than selling alcohol to minors now doesn’t it!

  3. With Obama’s policies and Eric Holder in charge of prosecuting, these three will probably be considered “non-violent” and be back selling to the minors in town by Turkey Day

  4. Now you have to wonder is this money involved in other middle eastern activites? That have not been uncovered yet.

  5. Gone Greedy says:

    CDN can you find out if this store is still open for business?

    IF theyre allowed to stay open, BOYCOTT this store and spread the word!

    Such GREED, its sickening!

  6. The Feds weren’t here just to tag along on the arrest. With their presence, this signals something major

    • I agree. And you don’t conduct a 3 year long investigation just to slap someone on the wrist.

  7. Richie Blick says:

    Wow. Just wow. That is a lot of money and cigs. Do they also own Market Basket or is that someone different? I think they these people owned the former Benji’s Store business (not building) that burned. Maybe the 2 huge lotto winnings and the store burning need to be looked into further. When does a store owner win such high cash while everybody else rarely wins $5-500? GREAT JOB LAW ENFORCEMENT!

    • Because I Care says:

      How could someone who owns a store that sells lottery tickets be eligible to play and claim a prize anyway? Isn’t that against the lottery rules?

  8. I went back and read the previous articles published by CDN. So the person who scratched the $1 million ticket was not the same person who signed the ticket and claimed the price. I wonder what relation the ticket purchaser had with the owner of 340 Quick Mart. Something doesn’t add up here. The article clearly states that Kashmiri claims he went into Food Lion to purchase milk and bought the scratcher ticket, but there are people that are saying that they were in the Food Lion when the man who purchased the ticket scratched it and it was not Kashmiri. A later article from CDN says that even if Kashmiri did not purchase the ticket, he is considered the winner because he signed it and claimed it. So, if someone else bought the ticket and gave it to Kashmiri as a “gift”, or for whatever reason, why would Kashmiri lie and say he went there to buy milk and he buys his tickets there because his wife won’t let him buy tickets at his own store. Makes no sense, but maybe the “win” from the VA Lottery caused the government agencies to investigate his practices more closely. I for one do not shop at this store and will not shop there if it remains open.

    • Purchase, Lie, Buy, Lie: this whole seen is not our Berryville
      I pray we can get back to normal but we need a Justice System we can depend on !

  9. There was an article in Wired last February about a very smart statistician who realized that it was possible to sort, with upwards of 90 percent accuracy, the winning scratch tickets from the losing tickets before anything was scratched off. In other words, he broke the game.

    http://www.wired.com/magazine/2011/01/ff_lottery/all/1

    The article goes on to describe how such a system could be used to launder money:

    “if organized crime had a system that could identify winning tickets more than 65 percent of the time, then the state-run lottery could be turned into a profitable form of money laundering. “You’ve got to realize that, for people in organized crime, making piles of money is one of their biggest problems,” says Charles Johnston, a supervisory special agent in the organized crime section of the FBI. “If they could find a way to safely launder money without taking too big a loss, then I can guarantee you they’d start doing it in a heartbeat.”

    Very interesting….

  10. And just how dumb do you have to be to draw attetion to yourself by selling to minors when you’re doing major league stuff like this loser?

    • Rice St. Resident says:

      if it was a 3 year investigation, they were probably years past the “looking over their shoulders”, after years of unethical and illegal practice, they probably thought they were invincible.

      • My thoughts exactly! I bet they thought at this point they thought they had a great thing going and never once considered they were being investigated.

  11. Leaves a lot to wonder with so many mom and pop stores in the area being bought up. How much more of this type of stuff is going on that has not been detected. Just think a few weeks back folks were complaining about the cross street business. This is a little bit worse than repaired cars setting around.

    • Because I Care says:

      Smitty, I have the same thoughts. I’m sure there are many other networks out there. This guy, when he won the lottery, mentioned he was going to use the proceeds to “help flood victims in Pakistan.” It wouldn’t surprise me if this money laundering was part of a broader operation that benefits Pakistan more than it does the USA. And as we have heard in recent national news reports, Pakistan has not been the ally we once thought they were, along with several other Middle Eastern countries.

  12. The government tax on tobacco, alcohol, gas etc. is out of control. Are you not sick and tired of over taxation, waste, fraud and abuse by the federal government? Along with income tax, property tax, sales tax, we are taxed to death in this country. Are you as sick of it as I am?

    • Sharon Strickland says:

      No, I am not tired because I live in the most wonderful country in the world. Sid, leave if you do not like it here. Our taxes support our police, our fire, our rescue, our teachers, a public education system for our children, medicine for the elderly, homes for the displaced, and multiple other programs that benefit Americans. America is what it is –the land of the free and the home of the brave. Our taxes pay for the world’s greatest military too and with Veteran’s Day coming, I am thinking of the taxes that pay for our wounded warriors and help their families. You should be ashamed of yourself for even writing that garbage!

      • Sharon, do you buy things on credit that you will never be able to pay for, until a friend or relative of yours bails you out? Or do you continue borrowing after you are so far in debt you’ll never get out? America is most of what you say it is. I will never leave because I believe it is great and can be great again, but is being taken down the wrong road by politicians who want to justify their existence by spending money they don’t have. Have you looked at your paycheck lately (if you earn one)?

        If you are not tired of it, then continue to vote for those who will increase your taxes and spend more of our hard earned money. It is your right and freedom to do so Sharon. And if you feel they aren’t getting enough from you, be a patriot and write a check. I will not vote for those people. Government is over inflated mostly at the federal level, but in many cases it goes into state and local.

  13. Dmaxnjackson says:

    I have never stepped foot in that place. I mean really, doesnt that place look like a bulldozer needs to go through it??

    • I thought one already did.

      • Google Cigarette Trafficing and notice what most of the money benefits.

        • Thinking out loud says:

          Ok with that Goggled, it already had crossed my mind. I read about the bust a while back that happened in NY. BTW this case is involved with NY read the link to indictment on the newest article.

          Homeland security is involved for a very good reason. I hope this isn’t the case.

  14. I know these guys, and I’m friends with their son. I’ve been to the store and everything. He’s a nice guy and I honestly think he wouldn’t do this..

    • It is so sad for the son to see his Dad’s picture in the newspaper. I wonder what will happen to this little boy and if there are other children.

      • Yes there are more children I hope they are all okay. I am the wife of Farman Ali they are all good people and I hope he gets out soon.

  15. Bill Lukens says:

    This used to be the realm of the mobsters up and down the east coast…. That activity still probably goes on while the Feds are busy setting up their own systems to catch the greedy and unwary….