FOR IMMEDIATE RELEASE
NEWS RELEASE
January 7, 2013
For More Information, contact:
Luther Strange
Joy Patterson (334) 242-7491
Alabama Attorney General
Page 1 of 2
AG, REVENUE COMMISSIONER ANNOUNCE ARREST OF BIRMINGHAM
WHOLESALERS FOR TOBACCO TAX EVASION AND CRIMINAL
POSSESSION OF FORGED INSTRUMENTS
(MONTGOMERY)–Attorney General Luther Strange and Revenue
Commissioner Julie P. Magee announced a 242-count indictment resulting in the arrests
of two Birmingham business partners who own and operate a wholesale distribution
company that supplies goods to retail convenience stores.
Farhad Jiwani, 57, and Allaudin Merchant, 65, have been arrested by the
Jefferson County Sheriff’s Office. Jiwani surrendered on December 21 and has been
released on bond. Merchant surrendered today.
Jiwani and Merchant are the vice president and president, respectively, and the
owners of “Joey Enterprises, Inc.” The company is located in Birmingham and does
business as “Northstar Wholesale.” In all, Jiwani and Merchant are accused of evading
$1,050,244.74 in state tobacco taxes.
This is the second time in the past year that the Attorney General’s Office has
partnered with the Alabama Department of Revenue, a member of the Attorney
General’s Special Prosecution Alliance, to prosecute individuals for evading Alabama’s
tobacco taxes. On November 20, 2012 Shamim Ahmed Khan, also the operator of a
wholesale distributer, pled guilty in Shelby County to criminal possession of a forged
instrument in an attempt to evade state tobacco taxes. Khan was sentenced to 10 years,
which was split for the defendant to serve six months imprisonment and five years
probation. In addition, Khan was ordered to pay restitution to the State of Alabama for
taxes owed plus interest and penalties, totaling $1,721,996.
In this case, Attorney General Strange’s Office presented evidence to a Jefferson
County grand jury on December 7, which resulted in Jiwani and Merchant’s
indictment.* Specifically, the indictment charges the two men with the following:
44 counts each (for a total of 88 counts) of willful tobacco tax evasion, in violation of
Alabama Code Section 40-29-110, with each month of tax evasion constituting a
separate count, beginning in January 2007 and continuing through August 2010;
and
77 counts each (for a total of 144 counts) of second-degree possession of a forged
instrument in violation of Section 13A-9-6, with separate counts for each
commercial invoice presented to the Alabama Department of Revenue by the
defendants.
501 Washington Avenue Montgomery, AL 36104 (334) 242-7300
www.ago.state.al.us Page 2 of 2
No further information about the investigation or about Jiwani and Merchant’s
alleged crimes other than that stated in the indictment may be released at this time.
If convicted, both men face up to five years imprisonment and fines of up to
$100,000 for each of the 44 tax evasion counts, as well as a maximum of 10 years
imprisonment and fines of up to $15,000 for each of the 77 class C felony counts of
second-degree possession of a forged instrument. If found guilty, the men also could be
subject to other financial penalties plus interest on the taxes evaded.
Attorney General Strange and Commissioner Magee commended those involved
in this case, noting Deputy Attorney General Mike Duffy and Assistant Attorney
General Pete Smyczek of the Attorney General’s Special Prosecutions Division and
Special Agent Jerome Dangerfield of the Alabama Department of Revenue’s
Investigations Division.
*An indictment is merely an accusation. The defendants are presumed innocent unless and until proven guilty.
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