CHICAGO | The owner of a pair of gasoline stations, including one in Calumet City, faces criminal charges for what Illinois state officials say was an attempt to defraud the state of nearly $1 million in gasoline sales taxes.
Samer T. Farhan, 32, of southwest suburban Palos Hills, was arrested this week, and faces charges of 28 counts of filing fraudulent sales and use tax returns, two counts of mail fraud and five counts of money laundering. Mail fraud is a Class 3 felony punishable by up to seven years in prison, while money laundering is a Class 2 offense punishable by up to five years of incarceration.
Farhan owns the Valero Gas station at 1812 E. Sibley Blvd. in Calumet City, in addition to a Citgo Gas station on Chicago’s West Side. The Illinois attorney general’s office said Friday that between May 2008 and April 2011, Farhan allegedly underreported sales at both stations in a scheme to avoid paying up to $975,000 in state sales taxes.
The attorney general, along with the Illinois Department of Revenue, said that Farhan tried to conceal underreported sales by “laundering” more than $200,000 in a bank account based in Amman, Jordan.
Farhan made his initial appearance in Cook County Criminal Court on Friday, where a $1 million cash bond was set. He is scheduled for a preliminary hearing on March 21, said Maura Possley, of the Illinois attorney general’s office.
While Illinois Attorney General Lisa Madigan said an ongoing sting operation has found nearly $75 million in unpaid sales taxes from gas station owners, she said the arrest of Farhan is due to “the largest case of gas sales tax fraud that we have uncovered yet.”
Also assisting in the investigation was the Secret Service, which helped with the charges related to money laundering.
This is not the first time the Valero Gas station has come under public scrutiny.
Last year, Calumet City 3rd Ward Alderman Thaddeus Jones complained publicly about the gas station, saying he had heard complaints the business was selling cigarettes individually, rather than in packages, which is a violation of the law.
Calumet City police said Friday the gas station’s owners had not been cited for any violations. Jones had said he wanted to revoke the business license for Valero. Both Jones and 4th Ward Alderman Brian Wilson claimed the gas station attracted an undesirable element to the neighborhood.
As far as illegal cigarette sales are concerned, Calumet City police Assistant Chief Dan Zorzi said officers conducted a sting operation Thursday night of local businesses. The Valero Gas station was among those approached, although operators working did not make improper sales, he said. Four other gas stations or liquor stores were cited for violations.