BERLIN — Two local business owners have been indicted for enterprise corruption and money laundering, among other charges, for their roles in smuggling millions of dollars’ worth of illegal untaxed cigarettes.
Approximately $1.4 million in large black bags and 20,000 cartons of cigarettes were recovered Wednesday from the West Ocean City home and other properties belonging to Basel Ramadan 42, who is being called the “ring-leader” and “boss of the enterprise” in a vast cigarette smuggling conspiracy. His younger brother, Samir Ramadan, 40, was referred to as the “enterprise treasurer” in a press release from the New York Attorney General’s Office.
At a press conference yesterday, New York Attorney General Eric T. Schneiderman and New York Police Commissioner Raymond W. Kelly announced the indictments of 16 members of a criminal ring that brought approximately one million cartons of untaxed cigarettes from Virginia to the New York City area.
Law enforcements suspects the proceeds of this illegal operation could be ending up in the hands of terrorist groups, but at this point it’s not a certainty.
“The association of some of the suspects in this case to the Ari Halbestram’s killer, the Blind Sheik and a top Hamas official concerns us,” said Kelly. “While it hasn’t been established yet where the illicit proceeds ended up, we’re concerned because similar schemes have been used in the past to help fund terrorist organizations like Hamas and Hezbollah.”
On Wednesday morning, Homeland Security officials and New York authorities stormed a condominium above the Subway on Sunset Drive and Coastal Highway and were seen confiscating items and seemed to be working a crime scene. In West Ocean City, in the Oyster Harbor community, a similar scene played out with the two brothers arrested. Personal property was seized and vehicles were stripped during searches.
Witnesses in the Oyster Harbor community reported to The Dispatch 15 police vehicles from Maryland, New York and New Jersey surrounded the home at 12648 Whisper Trace and two suspects were reportedly handcuffed and seen face down on the lawn. Additionally, at one point, a suburban rolled into the community and six armed agents ran into the house. Four flatbed trucks were also spotted on site and towed all of the vehicles at the home.
The Ramadan family is the owner of several local businesses, including area convenience stores, the Village Market shopping center in Ocean City and the Subway on Sunset Drive where the raid took place (but not other Subways in Ocean City, Berlin and Ocean Pines).
Both Basel and Samir Ramadan were being held yesterday in Worcester County on the charge of fugitive from justice — New York.
Questions to the federal Homeland Security office have not been answered as of deadline.
At yesterday’s press conference, authorities outlined the long-term investigation and specifically discussed the Ramadan brothers.
“This joint investigation by the Attorney General’s Organized Crime Task Force and the New York City Police Department, and with the assistance of Homeland Security Investigations, uncovered the trafficking ring and its connections to Brooklyn, Queens, Staten Island, the Bronx, Albany, Schenectady and multiple other states, including Maryland, Delaware, Virginia and New Jersey.
Through the use of electronic surveillance, physical surveillance and the review and analysis of financial records in conjunction with other investigative tools, the Attorney General’s investigation revealed that the head of the enterprise, Basel Ramadan, and his brother, Samir Ramadan, obtained cigarettes from a wholesaler, Cooper Booth Wholesale, Inc., in Virginia and stored them in a public storage facility in Delaware,” the Attorney General press release said. “Several times a week, co-conspirator Adel Abuzahrieh, of Brooklyn, drove with tens of thousands of dollars in cash from New York to Delaware where he gave the Ramadans the cash in exchange for cigarettes. Beyond the $55 million in purchases to cigarettes, the Ramadans have generated more than $10 million in profits from their illegal activities.”
Once the distributors were given the cigarettes, totaling approximately 20,000 cartons per week, they were provided to resellers, who then sold the untaxed smokes to Arab markets and grocery stores in the New York area. In total, the estimated sales tax revenue lost to New York State was estimated at more than $80 million.
“The Ramadan brothers furthered the criminal enterprise by depositing more than $55 million from their untaxed cigarette sales into small local financial institutions in and around Ocean City, Md., and used that money to purchase additional cigarettes for illegal sale,” the press release states.
Basel Ramadan and Samir Ramadan, along with 14 other New York and New Jersey residents, face anywhere from eight to 25 years in prison.
Although the brothers’ exact business ownership in the Ocean City is murky at best, due to another Ramadan family also being local proprietors, tax records confirm Basel Ramadan, through BSM Ocean City Properties LLC and Phoenix Property Investment LLC, owns several units in the Village Market shopping center on 18th Street and Philadelphia Avenue. The brothers own the Subway on Sunset Drive and the condominiums above it that served as their main office, but sources confirm they do not own the Subways on 12th Street, 3rd Street, inside the Walmart, Ocean Pines as well as Berlin.