Defendants Pleads Guilty to Mail Fraud, Conspiracy to Commit Money Laundering, and Conspiracy to Defraud
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that Sun Sims, 52, of Anchorage, entered a guilty plea to mail fraud, conspiracy to launder money, and conspiracy to make false statements regarding the distribution of cigarettes. Sims conspired with others to defraud the Municipality of Anchorage (MOA) by evading the payment of cigarette excise tax.
According to the plea agreement, Sun Sims and her business partner owned, operated, and managed Up in Smoke, located in the MOA, and Golden Eagle Tobacco and Longmere Lake Grocery and Liquor, both located outside the MOA. Because they owned Golden Eagle Tobacco and Longmere Lake Grocery and Liquor, Sun Sims and her partner could legitimately purchase MOA excise tax exempt cigarettes from tobacco wholesale distributors located in the MOA only if those cigarettes were actually transported outside of the MOA and offered for sale at those two stores. However, cigarettes that they purchased within the MOA and intended to sell at Up in Smoke or distribute to others within the MOA were not excise tax exempt.
Between 2009 and October 10, 2012, Sun Sims and her partner used their Golden Eagle Tobacco and Longmere Lake Grocery and Liquor store accounts with tobacco wholesale distributors within the MOA to purchase excise tax exempt cigarettes that they intended to sell and distribute within the MOA. Thus, they avoided paying the MOA excise tax and increased their own profits.
In addition, for a fee, Sun Sims and her business partner would sell tax exempt cigarettes to other retailers within the MOA. Sims and her partner would collect payment from the various retailers and convert the money collected into cashier’s checks that appeared to be purchased by either Golden Eagle Tobacco or Longmere Lake Grocery and Liquor for the purpose of buying tax exempt cigarettes. Then they used these cashier’s checks to purchase more tax exempt cigarettes, which they delivered to the other retailers within the MOA.
As part of the plea, Sims agreed to forfeit $1,214,402 in currency as well as 500 one-ounce silver coins. Mail fraud carries a sentence of up to 20 years imprisonment and fines up to $250,000. Conspiracy to money launder carries a sentence of up to 20 years imprisonment and fines up to $500,000. Conspiracy to make false statements regarding the distribution of cigarettes carries a sentence of up to five years’ imprisonment and fines up to $250,000
The case was jointly prosecuted by Assistant U.S. Attorney Stephan A. Collins and Special Assistant U.S. Attorney Erin W. Bradley of the U. S. Attorney’s Office for the District of Alaska. The case was investigated by the Internal Revenue Service Criminal Investigation (IRS-CI), Alcohol Tobacco and Firearms (ATF), and the Anchorage Police Department.