United States Attorney's Office District of Connecticut
Press Release

FIVE NEW JERSEY BUSINESS PARTNERS ADMIT PARTICIPATION IN TAX EVASION SCHEME

Nora R. Dannehy, Acting United States Attorney for the District of Connecticut, today announced that five New Jersey men have pleaded guilty to federal charges stemming from a large tax evasion scheme involving a chain of discount stores they owned and operated in Connecticut and elsewhere.

MOHAMMED ARIF, 51, of Piscataway, N.J., MOHAMMED MEMON, 56, of Somerset, N.J., and HAJI MEMON, 48, of Piscataway each pleaded guilty yesterday, April 20, before Senior United States District Judge Peter C. Dorsey in New Haven to one count of filing a false federal tax return.  Today, MOHAMMED NAEEM, 44, of Somerset, and MOHAMMED JAWEED, 41, of Somerset, appeared before Judge Dorsey and pleaded guilty to the same charge.

According to documents filed with the Court and statements made in court, the five defendants are brothers who were partners in Dollar Dreams, a chain of discount retail stores that operated in several states and had 10 locations in Connecticut.  From 2001 to 2003, the defendants systematically “skimmed” significant amounts of cash from the businesses and failed to report this income to the Internal Revenue Service.  As part of the scheme, some of the defendants directed their store managers to keep records of the skimmed cash, and they regularly traveled to Connecticut to pick up bags of skimmed cash.  Once the cash was delivered to New Jersey where the defendants resided and managed their businesses, certain defendants arranged for the cash to be stored, kept a detailed log of when each defendant took some of the cash, and managed a second set of books.

Each of the defendants is scheduled to be sentenced on September 8, 2009, at which time each faces a maximum term of imprisonment of three years and a fine of up to $100,000.  In addition, the defendants have collectively agreed to pay to the IRS restitution of more than $1.2 million.

The defendants no longer operate the stores, which were located in Bloomfield, Bridgeport, Manchester, Meriden, New Britain, New Haven, Waterford, Waterbury and West Hartford.

This matter was investigated by the Internal Revenue Service – Criminal Investigation Division, the United States Department of Labor, Office of Inspector General, and the United States Postal Inspection Service. The case is being prosecuted by Assistant United States Attorney Raymond F. Miller.

CONTACT:

U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
thomas.carson@usdoj.gov