Longmeadow man sentenced to USAO-MA for tobacco tax fraud and illegal check-cashing business

BOSTON — In September, a Longmeadow man was sentenced. Two cases related to evading payment of tobacco sales taxes and operating an illegal check-cashing business were heard in federal court in Springfield on January 15, 2022.

Satish Kumar, 67, was sentenced by U.S. District Judge Mark. G. Mastroianni received one year of probation. In November 2015, Kumar pleaded guilty to one count of conspiracy, three counts of wire fraud and one count of money laundering in one case. In the second case, Kumar pleaded guilty to one count of failing to register a money transfer business.

In 2006, Kumar acquired the wholesale warehouse business in Berlin, Connecticut. Kumar systematically evaded Connecticut’s tobacco tax, selling cigars and smokeless tobacco to convenience stores and gas stations. Kumar has been failing to pay Connecticut the required tobacco excise tax, paying only 2% of the tax owed. In 2008, Kumar sold the company, but he continued to profit from the ongoing tobacco tax fraud at the Berlin warehouse. The fraud stopped in June 2012 when federal agents executed search warrants at warehouses in Berlin and 12 other locations in Massachusetts, Connecticut and Pennsylvania. During the six-year program, Kumar and others helped avoid more than $16 million in taxes owed to Connecticut.

In the illegal check-cashing case, Kumar owned a liquor store in Springfield, Massachusetts. This also acts as an unregistered money transfer business. Despite the bank’s warning, Kumar cashed the check without the required registration. Among the checks that were cashed were 195 US Treasury tax refund checks, worth about $1.2 million, obtained through fraudulent filings with the IRS.

U.S. Attorney Rachel S. Rollins; James M. Ferguson, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms, and Explosives, Boston Field Division; Joleen D. Simpson, Special Agent in Charge of Criminal Investigations for the Boston IRS; Massachusetts State Department of Revenue Commissioner Geoffrey E. Snyder; Connecticut Department of Revenue Acting Commissioner John Biero; New England Special Agent in Charge of Homeland Security Investigations Matthew B. Millhollin made the announcement. The cases were prosecuted by Assistant U.S. Attorneys Christopher Morgan and Assistant U.S. Attorney Steven Breslow of the Rollins Springfield branch.

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