RICHMOND, Va. – A Chesterfield man faces five years in prison and a $250,000 fine for his role in a crime that involved $19.8 million worth of cigarettes. Mohamed Seid Ahmed Mohamed, 56, pleaded guilty Wednesday to conspiracy to commit wire fraud and to traffic in contraband cigarettes, according to the United States Attorney for the Eastern District of Virginia.
Mohamed used his role as owner of City Cigarettes in Richmond to buy 440,000 cartons of cigarettes from wholesale stores between 2011 and 2014 without paying the applicable Virginia Retail Sales and Use Tax.
He did so by claiming the cigarettes would be resold at City Cigarettes, according to his plea agreement.
Instead, Mohamed and his co-conspirators sold most of the cigarettes to people who they knew would take the cigarettes out of state to sell in the black market -- tax free.
"Mohamed and his co-conspirators never intended to and, in fact, did not collect or pay, the applicable Virginia Retail Sales and Use Tax for the cigarettes purchased at the wholesaler," the United States Attorney said. "The activity of the conspiracy resulted in lost sales tax revenue to the Commonwealth of Virginia in the amount of $1,009,046."
Mohamed, who was charged with the conspiracy on August 25, will be sentenced on December 11.
