U.S. Department of Justice
Peter F. Neronha
United States Attorney
District of Rhode Island
January 24, 2014
Rhode Island Businessman Pleads Guilty to Trafficking Contraband Cigarettes
Two others set to plead guilty, four to stand trial for roles in alleged scam which
cheated Rhode Island of $500,000 in tax stamp collections
PROVIDENCE, R.I. –Abdullah Alnahas, 36, of Cranston, owner and operator of a Cranston convenience store and a Providence laundromat, faces up to 10 years in federal prison for his participation in a contraband cigarette conspiracy that allegedly brought more than six million contraband cigarettes valued at more than $1.2 million dollars into Rhode Island from Virginia, and which allegedly cheated Rhode Island out of more than $500,000 in tax stamp payments.
Alnahas appeared before U.S. District Court Chief Judge William E. Smith on Thursday and pleaded guilty to one count each of conspiracy to engage in contraband cigarette trafficking and contraband cigarette trafficking. Alnahas is scheduled to be sentenced by Chief Judge William E. Smith on May 9, 2014.
Abdullah Alnahas’s guilty plea was announced by United States Attorney Peter F. Neronha; Colonel Steven G. O’Donnell, Superintendent of the Rhode Island State Police; Vincent B. Lisi, Special Agent in Charge of the Boston field office of the FBI; John Collins, Acting Special Agent in Charge of the Boston office of the Internal Revenue Service, Criminal Investigation; Bruce M. Foucart, Special Agent in Charge of Homeland Security Investigations for New England; Scott E. Antolik, Special Agent in Charge of the Boston field office of the Social Security Administration, Office of the Inspector General/Office of Investigations; and William G. Squires, Special Agent in Charge of the northeast region of the U.S. Department of Agriculture Office of Inspector General.
Abdullah Alnahas is one of eight defendants named in federal grand jury indictments returned in May and September 2013, that allege that beginning in July 2011, the defendants participated in a scheme to traffic contraband cigarettes into Rhode Island. It is alleged that several “shell” corporations were created in Virginia and that several vacant retail storefronts in Virginia were rented for the stated purpose of purchasing and reselling cigarettes in Virginia. The cigarette packages purchased included Virginia tax stamps, reflecting a Virginia tax of thirty-five cents per package.
However, according to the indictments, it is alleged that more than 30-thousand cartons (6 million) of cigarettes valued at more than $1.2 million dollars that were purchased in Virginia were shipped to Rhode Island for resale in a truck bearing Rhode Island War Veteran Plates. It is alleged that on numerous occasions the truck was driven by a Rhode Island man, while wearing his United States Army uniform, in an effort to gain favor and avoid law enforcement detection.
To date, co-defendants Valeria Mendez (Khalil) and Richard Larrain have filed notice with the court of their intention to plead guilty for their roles in the conspiracy and other alleged illegal activities. A trial date of April 8, 2014, has been scheduled for the remaining defendants, Bassam Kiriaki, Wissam Khalil, Bassam Khalil, and Najd Khalil. An arrest warrant has been issued for an eighth defendant, Nazir Khalil.
An indictment is merely an allegation and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
The cases are being prosecuted by Assistant U.S. Attorney William J. Ferland.
To assist the media and the public, a glossary of federal judicial terms and procedures is available at http://www.justice.gov/usao/justice101/