Queens DA Richard Brown: 12 Charged With Smuggling And Selling Untaxed Cigarettes

NEW YORK (CBSNewYork/AP) -- In "Operation Smokeout," Queens District Attorney Richard Brown seized over 4,000 cartons of untaxed cigarettes in just three months. The cigarettes were apparently smuggled in from overseas and some Southern states.

1010 WINS' Juliet Papa reports: One man was caught at the airport with suitcases full of cigarettes

Brown explained that millions are lost in tax revenue. Cartons go from $12 to $14 a piece but Brown said the smuggled cigarettes go for half that amount.

WCBS 880's Marla Diamond reports: Most Of The Cigarettes Were Smuggled Into JFK From Places Like Uzbekistan And Korea

Brown said 12 defendants shortchanged the state by nearly $300,000.

A special unit has been put in place to handle tax avoidance schemes.

Meanwhile, New York City has filed a federal lawsuit accusing 32 people of evading millions of dollars in cigarette taxes by buying heaps of cartons over the Internet, and then reselling them on the black market.

The suit takes aim at city residents who bought cigarettes from Chavez Inc., a Kentucky company that was raided and effectively shuttered by federal agents in late 2009.

The defendants include one woman accused of having nearly $1 million worth of cigarettes shipped to her Brooklyn apartment over three years -- about 32,000 cartons.

The city is seeking $6.5 million in unpaid taxes from Chavez Inc. and the other defendants, plus another $13 million in penalties.

Lawyers for Chavez have said the company was not legally obligated to collect taxes on out-of-state sales.

(TM and Copyright 2011 CBS Radio Inc. and its relevant subsidiaries. CBS RADIO and EYE Logo TM and Copyright 2011 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)