Cigarette smugglers convicted

Jackson Bell

Five Glendale men were sentenced Monday, three to federal prison, for

smuggling cigarettes bought in Virginia into California, where

cigarette taxes are higher.

Vicken Djeredjian, 31, and Mnatsakan Grigorian, 39, -- the

ringleaders -- were sentenced in a Virginia courthouse to two years

in jail and three years probation, Executive Assistant. U.S. Atty.

Sharon Burnham said.

The 55-count indictment was for transporting more than 60,000

cigarettes per shipment, which is considered contraband, Burnham

said, and for money laundering.

Of nine Los Angeles County men indicted, three others were

Glendale residents: Manvel Iskandaryan, 47; Albert Asatryan, 47; and

Azat Stephanyan, 23, Burnham said. The three drove loads of

cigarettes cross-country and helped in the illegal transactions.

Their sentencing ranged from six months in prison, to one-year

probation to a $150 fine.

During a four-year federal investigation, the men purchased more

than 108 million cigarettes, with a retail value of about $18.5

million, for nearly $9 million, Burnham said. They avoided paying

more than $4.7 million in California cigarette taxes by smuggling

them in from Virginia, she said.

One case, or 60 cartons, cost $15 in taxes in Virginia; California

levies $522 per case, Burnham said.

“One cannot buy large quantities of cigarettes in low-tax states

and take them to high-tax states without following state laws,” she

said. “So when they were buying a large volume, it triggered a red

flag for the store employee.”

That cigarette vendor also became suspicious because the smugglers

paid in cash, Burnham said.

The employee then contacted the federal Bureau of Alcohol,

Tobacco, Firearms and Explosives, and an undercover investigation was

launched, Burnham said.

The men would purchase the cigarettes and truck them into Glendale

and surrounding areas, where they sold the cigarettes wholesale or

retail, she said.

They would put their illegal earnings into forfeited bank

accounts, or spend them on cars, real estate and to buy more

cigarettes, Burnham said.

Djeredjian, Grigorian and another of the ring’s organizers -- Akop

Chichyan, 33, of Granada Hills -- worked out of a warehouse on San

Fernando Road until fall of 2001, when they became suspicious that

undercover agents were staking them out from a van, Burnham said.

The three moved their operation to a North Hollywood location.

Their largest order was 800 cases of cigarettes paid for with

$800,000 in cash, Burnham said.

The nine were indicted in March 2003, and pleaded guilty March 7,

officials said.

“This case is important not just because the state of California

lost tax revenues,” Burnham said. “But because there is a huge

incentive to generate a lot of money quickly and easily that can be

used in any other number of illegal activities.”

The state loses an estimated $300 million annually in revenues due

to cigarette tax evasion, said Anita Gore, spokeswoman for the

California State Board of Equalization.

“These are taxes that affect Californians,” Gore said. “The

cigarette taxes are used for many health and children’s programs, and

those things suffer when the appropriate taxes are not paid.”

* JACKSON BELL covers public safety and courts. He may be reached

at (818) 637-3232 or by e-mail at jackson.belllatimes.com.