TRIBAL CIGARETTE WHOLESALER PLEADS GUILTY TO OBSTRUCTION OF JUSTICE
New York Company Pays $1 Million for False Declarations in Smoke Shop Forfeiture Case
A Perrysburg, New York company pleaded guilty and was sentenced last week in U.S. District Court in Seattle to obstruction of justice. The plea resolves criminal charges brought against the owner, Arthur Montour, and an agent, Peter Montour, of Native Wholesale Supply (NWS), a New York based cigarette supplier, in connection with a contraband cigarette scheme in the Western District of Washington. Under the terms of the plea agreement, the corporation NWS, will forfeit $1,000,000 to the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF).
In the plea agreement, Native Wholesale Supply admits that it filed false information with the court in connection with a civil forfeiture action. The United States was seeking to forfeit more than $50,000 in proceeds of sales of contraband cigarettes. The cigarettes were purchased from Native Wholesale Supply, by the operators of the Blue Stilly Smoke Shop near Arlington, Washington. Native Wholesale Supply now admits information filed with the court claiming it had not done business with the Blue Stilly Smoke Shop was untrue.
Native Wholesale Supply is a corporation chartered under the laws of the Sac and Fox tribes of Oklahoma. The corporation sells tobacco products from its main offices on Seneca Nation Territory in upstate New York. As part of its sentence, NWS was placed on five years of probation, required to comply with all federal and state laws regarding any future importation of cigarettes into the State of Washington, and ordered to forfeit $1,000,000 to the AFT. In addition, under the terms of the plea agreement, NWS agrees not to contest a 30-day suspension of its importer’s permit by the Alcohol and Tobacco Tax and Trade Bureau (TTB).
On March 16, 2009, three members of the Stilliguamish Tribe were sentenced to prison for their scheme to profit by selling contraband cigarettes without paying the applicable Washington State tax. Edward Leverne Goodridge Sr., 60, and Edward Goodridge Jr., 33 both of Arlington, Washington, and Sara Lee Schroedl, 40, now of Prescott, Arizona, pleaded guilty in November 2008, to Conspiracy to Traffic in Contraband Cigarettes and Engaging in Monetary Transactions involving criminal proceeds. The three tribal members were on the tribal council when they set up a corporation to run the Blue Stilly Smoke Shop for their own personal profit. The Goodridges were each sentenced to 14 months in prison and 2 years of supervised release. Schroedl was sentenced to 8 months in prison and 2 years of supervised release.
Evidence gathered from the searches of Blue Stilly and various cigarette suppliers revealed that between March 2003, and May 2007, the Blue Stilly had ordered and illegally sold in excess of 1.8 million cartons of cigarettes and generated more than $55 million in revenues from the illegal sales of cigarettes. The four conspirators personally profited $15 million, which they used for their own benefit and did not pay any cigarette tax to the State of Washington. The $50,000 being sought for forfeiture represents payments made by the Blue Stilly Smoke Shop to Native Wholesale Supply.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF), the Internal Revenue Service Criminal Investigations (IRS-CI), and the Washington State Liquor Control Board. The case was prosecuted by Assistant United States Attorneys Mary K. Dimke, J. Mark Parrent, and Richard E. Cohen.
For additional information please contact Emily Langlie, Public Affairs Officer for the United States Attorney’s Office, at (206) 553-4110 or Emily.Langlie@USDOJ.Gov.