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


Date: September 19, 2022

Contact: newsroom@ci.irs.gov

BOSTON — A Longmeadow man was sentenced on Sept. 15, 2022 in federal court in Springfield for two cases in connection with evading payment of tobacco sales tax and operating an illegal check-cashing business.

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

In 2006, Kumar purchased a wholesale warehouse business in Berlin, Conn. Kumar systematically evaded Connecticut state tobacco taxes, in selling cigars and smokeless tobacco to convenience stores and gas stations. Kumar consistently failed to pay the required tobacco excise taxes to Connecticut, paying just two percent of the tax owed. In 2008, Kumar sold the business, but he continued to receive proceeds from the continuing tobacco tax fraud that occurred at the Berlin warehouse. In June 2012, the fraud ceased when federal agents executed a search warrant at the Berlin warehouse and 12 other locations in Massachusetts, Connecticut, and Pennsylvania. During the six-year scheme, Kumar and others helped to evade over $16 million in taxes owed to the state of Connecticut.

In the illegal check cashing case, Kumar owned a liquor store in Springfield, Mass. that also acted as an unregistered money transmitting business. Kumar cashed checks without the required registration despite warnings from his bank. Among the checks cashed were 195 United States Treasury tax refund checks worth approximately $1.2 million obtained through fraudulent returns filed with the IRS.

United States Attorney Rachael S. Rollins; Joleen D. Simpson, Special Agent in Charge of the Internal Revenue Service's Criminal Investigations in Boston; James M. Ferguson, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms & Explosives, Boston Field Division; Commissioner Geoffrey E. Snyder of the Massachusetts Department of Revenue; Acting Commissioner John Biello of the Connecticut Department of Revenue Services; and Matthew B. Millhollin, Special Agent in Charge of Homeland Security Investigations in New England, made the announcement. Assistant U.S. Attorney Christopher L. Morgan and Assistant U.S. Attorney Steven Breslow of Rollins' Springfield Branch Office prosecuted the cases.