TRENTON
- Attorney General Zulima V. Farber and
Gregory A. Paw, Director, Division of Criminal
Justice, announced the unsealing of a State
Grand Jury indictment charging six Hudson
County residents and a Pennsylvania man
with concocting a New Jersey-based, multi-state
coupon redemption fraud scheme that netted
hundreds-of-thousands of dollars in illegal
profits. The Division of Criminal Justice
- Financial Crimes Bureau investigation
was conducted in conjunction with the Washington
D.C.- based Coupon Information Corporation.
“Allegations
outlined in the criminal indictment detail
an elaborate scheme wherein store owners
in four East Coast states were solicited
by the defendants to participate in what
turned out to be a fraudulent coupon redemption
program. The defendants were able to convincingly
pull-off the scam and obtain hundreds-of-thousands
of dollars in illegal profits from national
manufacturer coupon programs,” said
Attorney General Farber.
According to Criminal Justice Director Paw,
the State Grand Jury indictment charged
the seven defendants with First Degree Money
Laundering, conspiracy, and theft by deception.
The indictment charges the defendants with
organizing, directing, and financing a multi-state
coupon fraud scheme that netted more than
$580,000 in illegally obtained payments
on behalf of retail stores ineligible to
participate in coupon redemption programs.
The defendants are identified as:
-
Shahin Kayed, aka Mustafa, 62, 1500
72nd St., North Bergen, Hudson County.
Arrested Jan. 19 in Hudson County. Bail
set at $100,000.
-
Rizek Kayed, aka Ricky, 46, 1504 73rd
St., North Bergen, Hudson County. Arrested
Jan. 19 in Hudson County. Bail set at
$200,000.
-
Mohammad Awadalla, aka Mike, 47, 6335
Kennedy Blvd., North Bergen, Hudson
County. Arrested Jan. 19 in Hudson County.
Bail set at $100,000.
-
Gazi Nassrallah, aka Jino, 43, 7700
Kennedy Blvd., North Bergen, Hudson
County. Surrendered to Division of Criminal
Justice on Feb. 1. Bail set at $200,000.
-more-
-
Siyam Kayed, aka Sammy, 43, 1500 72nd
St., North Bergen, Hudson County. Arrested
Jan. 19 in Hudson County. Bail set at
$150,000.
-
Belal Dalia, 23, 9001 Durham Ave., North
Bergen, Hudson County. Surrendered to
Division of Criminal Justice on Jan.
23. Bail set at $150,000.
-
Ribhi Mustafa, aka Ray, 29, 924 Unruh
Ave., Phila., PA. Surrendered to Division
of Criminal Justice on Feb. 1 after
initial arrest in Philadelphia. Bail
set at $100,000.
Director Paw said the State Grand Jury indictment
alleges that from October, 1999 through
July, 2004, the defendants contacted at
least 54 stores and/or retail outlets in
New Jersey, New York, Pennsylvania and Maryland
soliciting participation in a coupon redemption
“promotion” which would “qualify”
the store owners to receive cash payments
by redeeming manufacturer coupons. The three-count
indictment charges that the defendants did
not work for a coupon company and that the
stores solicited to participate in the “promotion”
were not entitled to coupon redemption funds.
The indictment charges that after unwitting
store owners agreed to participate in the
purported “promotion,” the defendants
prepared store participation applications
and sent the forms to various coupon clearing
houses which sort coupons for reimbursement
by manufacturers. The indictment alleges
that the applications grossly inflated the
size of the store and the amount of coupon-related
sales. In many instances, the stores did
not accept manufacturers coupons. Based
on the fraudulent submissions, it is alleged
that tens-of-thousands of coupons were submitted
to clearing houses which issued checks totaling
more than $580,000 to the store owners.
It is charged that the defendants demanded
fifty percent or more of the monies received
by store owners.
The investigation was coordinated by Deputy
Attorney General William T. McGovern and
State Investigator Rick Watson of the Division
of Criminal Justice - Financial Crimes Bureau,
Money Laundering Section, in conjunction
with the Coupon Information Corporation
(CIC) - a not-for-profit corporation formed
by manufacturers who issue cents-off coupons
in the United States. The CIC cooperates
with appropriate public authorities in the
investigation and prosecution of persons
and/or entities engaged in suspected coupon
fraud activities. Additional investigative
assistance was provided by the Federal Bureau
of Investigation and the U.S. Attorney’s
Office for the Eastern District of Wisconsin.
The indictment was handed up to Mercer County
Superior Court Judge Linda R. Feinberg on
Jan. 11 and sealed pending arrest and arraignment
of the defendants. The defendants are scheduled
to appear before Hudson County Superior
Court Judge Kevin Callahan on March 28.
If convicted on all counts, the defendants
face more than 20 years in state prison
and fines exceeding $200,000. An indictment
is merely an accusation. The defendants
are presumed innocent until proven guilty
in a court of law.
Additional information, including a copy
of the State Grand Jury indictment, is available
via the Division of Criminal Justice Web
site at www.njdcj.org.
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