Connecticut Tobacco Wholesaler Admits Defrauding State of $1.2 Million

Marc H. Silverman, Acting United States Attorney for the District of Connecticut, announced that KHAWAR M. KHOKHAR, 36, of Ellington, pleaded guilty today before U.S. District Judge Sarala V. Nagala in Hartford to an offense stemming from a scheme that defrauded the State of Connecticut of more than $1.2 million.

According to court documents and statements made in court, 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. Between approximately May 2017 and June 2019, Khokhar and Smokin' Wholesale purchased approximately $2 million in tobacco products from the distributors, but failed to report accurately to the Connecticut Department of Revenue Services the value of the products imported into the state, and failed to pay to the state the tobacco-related taxes owed. Through this scheme, Khokhar and others caused Connecticut to suffer a tax loss of more than $1.2 million.

Khokhar pleaded guilty to conspiracy, which carries a maximum term of imprisonment of five years. Khokhar also agreed to pay restitution in the amount of $1,201,701.13, and to forfeit $60,707 seized during the investigation. He is scheduled to be sentenced on September 3.

Khokhar is released on a $100,000 bond pending sentencing.

This investigation has been conducted by the U.S. Postal Inspection Service and the Connecticut Department of Revenue Services, Criminal Investigations Division. This case is being prosecuted by Assistant U.S. Attorney Michael S. McGarry.