A former Berlin business owner pleaded guilty Thursday in two cases in U.S. District Court in Springfield, Mass., in connection with evading payment of tobacco sales tax and operating an illegal check-cashing business. His fraud in Connecticut was worth an estimated $16 million.
Satish Kumar, 60, 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.
According to a U.S. Department of Justice announcement, in 2006, Kumar purchased a wholesale warehouse business in Berlin. Kumar systematically evaded Connecticut state tobacco taxes, in selling cigars and smokeless tobacco to convenience stores and gas stations. Kumar consistently filed false tobacco tax returns with Connecticut state tax authorities, paying just 2 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. Kumar was also arrested by federal authorities for running an illegal check cashing business in Springfield, Mass.
U.S. District Court Judge Mark. G. Mastroianni scheduled sentencing for April 13, 2016. Kumar lives in Longmeadow, Mass.
