KANNAPOLIS ó The former owner and operator of a Kannapolis wholesale company is one of 10 people charged in a multi-state scheme to evade tobacco taxes.
The federal indictment claims the combined proceeds were in excess of $5 million.
Darrell Brigman of Kannapolis, who was owner and operator of Spencer-Thomas Inc., which did business as Modern Wholesale Co. at 609 South Main St., posted a $100,000 bond following the November indictment in U.S. Eastern District Court in Raleigh.
Brigman is no longer involved in a business at that location, which is now Modern Wholesale and Tobacco and has been under new ownership for two years.
The 30-page indictment lays out a scheme to ship cigarettes from North Carolina into northern states ó Pennsylvania, New York, New Jersey, Connecticut and Delaware ó that place a much higher tax on cigarettes than North Carolina.
During 2007 to 2009, when the vanloads of cigarettes were going north, state excise taxes per carton ranged upward to $42.50 in the northern states.
According to the indictment a full-size van carrying 60 master cases of cigarettes ó containing 3,600 cartons ó from North Carolina to New York could result in a gross profit of as much as $140,400.
The scheme to avoid the state taxes apparently started prior to January 2004 and involved two other companies in addition to Brigman’s Modern Wholesale. The indictment names Ghassan Dahir, president of MGN Tobacco, which operated 12 retail “Smoker Friendly” stores in eastern North Carolina. Nicholas Oxendine, owner and operator of New AGe, Inc. in Lumberton, was also indicted.
Brigman and Oxendine were licensed to wholesale tobacco products. Dahir’s companies were not licensed to wholesale tobacco products.
The indictment names six “buyers” ó Ana Rodriguez, Alphonso Rodriguez, Carlos Rodriguez, Hedi Rodriguez, Kenny Salcedo and Willard Prez. They made frequent trips in vans to North Carolina carrying large quantities of cash, meeting the sellers at pre-determined locations.
The cigarettes were than sold as stolen. And in some cases, counterfeit tax stamps were also sold.
The indictment cites the huge volume of cash involved, including the efforts of Oxendine to deposit money in the bank without triggering the bank’s obligation to file Currency Transactions Report required for deposit of $10,000 or more.
The indictment specifies dates, number of cartons and the various people involved.
Brigman is cited personally or through his company in 19 counts of the 254-count indictment. Instances cited included shipments of cigarettes ranging from 1,250 cartons to 2,370 cartons in September through December 2006.
A total of 152 counts in the indictment are against Oxendine and are related to making deposits to evade U.S. codes.
Federal authorities are to recoup through forfeiture the proceeds of the illicit acts which the indictment specifies as $5,169,337.10.
Efforts to reach Brigman were unsuccessful.