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Pair’s 2013 conviction for possession of contraband cigarettes upheld by State Supreme Court

Date Posted: Friday, June 13th, 2014
Categories:  Criminal Department of Justice DOJ Press Releases

Dover – The Delaware Supreme Court this week upheld the 2013 conviction of two New York men convicted in a scheme to smuggle a large quantity of contraband cigarettes through Delaware.

 

“Trafficking in contraband cigarettes is a growing trend that funds criminal enterprises and it’s a concern to law enforcement,” Attorney General Biden said.  “We are working with our local and national law enforcement partners and with our sister states to enforce criminal penalties for those who possess contraband cigarettes and use our roadways to smuggle them across state lines.”

 

Delaware law prohibits an individual from possessing more than ten packs of cigarettes, unless that person is a licensed wholesaler transporting the product or a licensed retailer offering the product for sale.  In addition, before cigarettes can be transported for sale in Delaware or nearly every other state they must display a tax stamp that demonstrates the required cigarette tax has been paid to the state in which they will be sold.  The requirement that cigarettes display tax stamps for the state of their ultimate destination, along with other regulations governing the manufacture, distribution, marketing, and sale of cigarettes, help protect public health and deter trafficking in contraband cigarettes.

 

Cigarette traffickers, particularly along the Virginia to New York corridor, take advantage of the significant difference in states’ tobacco tax rates to purchase cigarettes from retail outlets in low tax states such as Virginia which charges a 30-cent per pack tax, and smuggle them for sale through the black market in states with higher taxes, and correspondingly higher retail prices, such as New York City which charges $5.85 per pack in taxes ($4.35 state tax plus $1.50 city tax).  Increasingly, organized criminal organizations turn to these activities to generate profits on the black market to fund criminal enterprises.

 

On September 2, 2012 Marco Hassan and Sayel Ghabayen were pulled over by Delaware River and Bay Authority police during a routine traffic stop.  During the stop, the officer observed a large quantity of cigarettes in the vehicle, and a search revealed 2,760 packs containing 55,200 individual cigarettes as well as $4,503 in cash in Ghabayen’s pockets.  The cigarettes had been purchased in Virginia and bore tax stamps from that state, and the men indicated they were transporting the product to New York City.  Neither Marco Hassan nor Sayel Ghabayen possessed cigarette wholesale or retail licenses and they were therefore charged with Possession of Untaxed Cigarettes and Conspiracy Third Degree.  The defendants were convicted of the charges in Superior Court last September, were each fined $202, and were ordered to forfeit the 55,200 confiscated cigarettes.

 

Hassan and Ghabayen challenged the constitutionality of the contraband cigarette statute in Superior Court, and ultimately to the State Supreme Court after Superior Court ruled against them.  The high court held oral argument in the case last week and in an Opinion issued this week the justices upheld the Superior Court’s decision which affirmed the convictions and the constitutionality of the Delaware law.

 

Read the Supreme Court and Superior Court Opinions.

 

This case was prosecuted by Deputy Attorney General Barzilai Axelrod and the State’s defense of the appeal was led by Deputy Attorney General Thomas Brown.

 

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