CT tobacco wholesaler accused of causing state to lose over $1M in tax fraud scheme
A Connecticut-based tobacco wholesaler is accused of operating a tax fraud scheme that allegedly caused the state to suffer a loss of over $1 million, officials said.
A federal grand jury in New Haven returned a 10-count indictment on May 15 charging Khawar M. Khokhar, 35, of Ellington, with one count of conspiracy, one count of engaging in an illegal monetary transaction and eight counts of wire fraud, according to the U.S. Attorney’s Office.
Khokhar appeared before U.S. Magistrate Judge Thomas O. Farrish in Hartford on Monday and pleaded not guilty.
Court records show that Khokhar operated Smokin’ Wholesale LLC, a Connecticut-licensed tobacco wholesale business that “acquired smokeless tobacco and other tobacco products from out-of-state distributors, including businesses in Pennsylvania and Illinois, and sold the products to retail merchants in Connecticut.”
Officials allege that between May 2017 and June 2019, Khokhar purchased around $2 million in tobacco products but failed to accurately report the value of the products to the Connecticut Department of Revenue Services and failed to pay the associated tobacco taxes owed, causing Connecticut to suffer a tax loss of approximately $1 million.
If convicted, Khokhar is facing a maximum of five years in prison on the conspiracy charge, 10 years on the illegal transaction charge and 20 years on each count of wire fraud.
He is currently free on a $100,000 bond, officials said.