(New Haven, Conn./CBS Connecticut) – Two men are being charged with defrauding the state out of nearly $6-million in a scheme to bypass the tax on tobacco products imported into the state.
A grand jury in federal court in Bridgeport returned a 13-count indictment on Thursday charging 39-year-old Pavan Vaswani of West Haven and 45-year-old Rishi Malik formerly of Fairfield.
In the indictment, Vaswani operated KDV Discounts, a wholesale tobacco business in Bridgeport. Malik operated Connecticut Discouts, which he sold to Vaswani.
Between 2013 and 2017, Vaswani is accused of filing false tax forms with the state Department of Revenue Services which underreported taxes due.
Both men are facing one count each of conspiracy to commit wire fraud to violate the Contraband Cigarette Trafficking Act.
In addition, the indictment charges Vaswani with a dozen counts of wire fraud and Malik four counts.
Each count carries with it a sentence of up to 20 years in prison.
Vaswani is free on $250-thousand dollars bond. Malik is being held pending a detention hearing.