Former owner of Chinqua Penn gets 40 months in prison
Posted: Wednesday, March 26, 2014 12:26 am
ABERDEEN, Miss. — The former owner of Chinqua Penn plantation near Reidsville, has been sentenced to 40 months in prison and order to pay $5.1 million in restitution for his involvement in a multi-state scheme to avoid taxes and fees on tobacco sales.
Calvin Phelps, who operated four tobacco sales businesses in Mocksville pleaded guilty in June 2012 to three counts of wire fraud, contraband cigarette trafficking and money laundering. Phelps was sentenced Monday in U.S. District Court in Aberdeen, Miss.
Phelps was accused of bilking the United States, Mississippi and some other states out of more than $4 million.
In his plea agreement, Phelps admitted reporting that certain cigarette brands were to be exported outside the U.S., when, in fact, they were to be sold domestically.
The plea document states that from 2007 into 2009, Phelps sold some 16,022 cases of these cigarettes for $3.19 million through G-Corp and evaded nearly $5 million in fees and taxes. He also agreed to forfeit up to $2 million he acquired with his illegal profits.
Prosecutors said Phelps worked to develop a fake paper trail giving the illusion he shipped tobacco products out of the U.S. and avoid paying Master Settlement Agreement money owed from participating tobacco companies to states involved in the tobacco settlement.
