A Seymour man pleaded guilty in federal court Monday to illegally trafficking tobacco products and selling them without paying required taxes.
The guilty plea from Jugjeev Kharbanda, 29, in U.S. District Court in Springfield, Mass. comes more than two years after federal agents raided Kharbanda’s Mountain Road home in Seymour to collect evidence in the case.
By that point, according to court documents filed by federal prosecutors, Kharbanda had been employed for about four years by an unnamed co-conspirator in a business that sold wholesale tobacco products out of warehouses in Danbury, Springfield and Scranton, Penn.
Most of the business’ customers were convenience stores, gas stations, and other retail businesses, according to the feds.
Court documents say the scheme cost the government millions of dollars in tax revenue.
According to the feds, between 2008 and 2012, Kharbanda, a corporate officer at the business that owned the Springfield warehouse, would bring smokeless tobacco and cigars there from the company’s other properties to be sold to customers.
The problem — the vast majority of the products were sold without excise taxes added, as required by law.
In addition, the feds alleged Kharbanda and others cooked the books at the business to disguise the scheme and also made fake invoices “that vastly understated the amount and value of cigars” transported to Massachusetts for sale.
Kharbanda and two others — Jaspal Singh, also of Seymour, and Hasmit Kharbanda, of Adams, Mass. — were indicted in connection with the scheme last September.
Less than a month later, Singh pleaded guilty to one count of conspiracy and three counts of contraband smokeless tobacco trafficking. Singh is scheduled to be sentenced April 21.
On Monday (Jan. 26), Kharbanda pleaded guilty to identical charges before U.S. District Court Judge Mark K. Mastroianni. He will also be sentenced April 21.
He faces up to five years in prison on each of the four counts, according to a plea agreement in the case, as well as fines and restitution.
A “change of plea” hearing for the other defendant charged in the case, Hasmit Kharbanda, has been scheduled for Feb. 10.
The feds calculated the government’s “tax loss” at between $2.5 and $7.5 million, and also want Kharbanda to forfeit about $3,000 they seized from his Seymour home when they raided it in June 2012 seeking evidence in the case.
The Valley Indy left a message Wednesday afternoon at the office of Kharbanda’s lawyer.
United States Attorney Carmen M. Ortiz; Daniel J. Kumor, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms & Explosives, Boston Field Division; William P. Offord, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston; and Bruce M. Foucart, Special Agent in Charge of Homeland Security Investigations in Boston, announced Kharbana’s guilty plea Monday.
The case is being prosecuted by Assistant U.S. Attorneys Alex J. Grant and Veronica M. Lei of Ortiz’s Springfield Branch Unit.
