PROVIDENCE, R.I. – An accountant with offices located in Pawtucket, R.I., pleaded guilty Monday to participating in a conspiracy which trafficked $1.2 million in contraband cigarettes into Rhode Island from Virginia. He also pleaded guilty to participating in a conspiracy to defraud the food stamp program. The guilty plea follows a federal and state investigation led by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI).
Bassam Kiriaki, 46, and six other individuals were indicted by a federal grand jury in May 2013, charged with participating in a complex conspiracy to import cigarettes from Virginia into Rhode Island that were then sold in convenience stores owned or operated by members of the conspiracy and others. The conspiracy resulted in the loss of more than $1 million in Rhode Island state tax revenue. Kiriaki admitted to the court that he made false representations to law enforcement and created a false tax document in order to conceal the conspiracy.
According to court records, the Virginia State Police stopped an alleged co-conspirator March 30, 2013, and seized $30,000 in cash from his vehicle. After the stop and seizure, the FBI intercepted calls made by Kiriaki during which he agreed to call Virginia State Police and tell them that the money was to buy merchandise for a "new" store in Virginia, Bad Boys Tobacco Stop, Inc. In other phone calls, Kiriaki discussed how he would create or backdate documents, including an Internal Revenue Service form, to substantiate the false claim to the Virginia State Police. The tax form was then faxed to Virginia State Police.
Kiriaki also admitted to the court that he participated in a conspiracy that filed fraudulent documents with the U.S. Department of Agriculture Food and Nutrition Service so that a convenience store owned by a co-conspirator could maintain participation in the Supplemental Nutrition Assistance Program (SNAP) as an approved vendor, despite being previously disqualified. The documents intentionally misrepresented the true owners of the business.
Bassam is scheduled to be sentenced June 6 by U.S. District Court Chief Judge William E. Smith. Each charge is punishable by statutory penalties of up to five years in federal prison followed by up to three years supervised release and a fine of up to $250,000.
The case is being prosecuted by Assistant U.S. Attorneys William J. Ferland and Ly T. Chin.
Other investigatory agencies included the United States Attorney’s Office, Rhode Island State Police, FBI, IRS Criminal Investigation, Social Security Administration – Office of the Inspector General/Office of Investigations and the U.S. Department of Agriculture Office of Inspector General.