Millions of dollars in cash, sports cars, jewelry and art once belonging to an executive at Swisher International, the world's largest cigar maker, are now in the hands of federal agents, according to court documents filed by the Bureau of Alcohol, Tobacco, Firearms and Explosives.
The ATF seized the assets from Alex Goldman, the president of Royal Gold Cigars, Swisher International's premium cigar division. They accuse him of secretly selling millions of dollars' worth of cigars to two unnamed California companies without paying state excise taxes.
California collects substantial taxes on cigars, between 31 percent and 46 percent of the sales price, and requires all dealers to be licensed by the Board of Equalization.
According to the court documents, Goldman willfully took steps to avoid those taxes while running his own company House of Oxford between 2006 and 2011.
The ATF said Goldman's House of Oxford company began selling untaxed tobacco to an unnamed "Customer Number 1" in 2006. The scheme involved House of Oxford shipping untaxed cigars directly to customers of "Customer 1" within California, but billing "Customer 1" at their out-of-state office. "Customer 1's" primary customer was a wholesale tobacco business inside California, according to ATF documents, although the documents don't name the company.
In 2009, House of Oxford began selling untaxed cigars to a second California tobacco distributor, according to the documents. Between 2009 and 2010, House of Oxford shipped cigars to "Customer 2" about 100 times. They avoided taxes by shipping the product to multiple home addresses associated with "Customer 2" instead of their business office.
According to ATF documents, Goldman signed a settlement agreement on April 14 admitting there was enough evidence to support the forfeiture of his property.
The ATF took in a huge haul from Goldman, including about $7 million in cash, a Ferrari, a Porsche, an Audi and 38 pieces of expensive jewelry and art, including three works by Joan Miro.
Agents also seized $5 million in funds related to a loan between House of Oxford and another major cigar company, Drew Estate. The documents don't say what the loan was for or if Drew Estates had any involvement in House of Oxfords' criminal activity.
Goldman was hired on to run Swisher's premium cigar division Royal Gold Cigars in 2013. The documents don't say if they suspect Goldman of doing anything illegal during his tenure at Swisher.
A spokesperson for the Department of Justice said she could not comment on the case because of the ongoing investigation. News10 will update the story as we learn more.