KOAM TV 7 Joplin and Pittsburg News Weather SportsEvidence thrown out in $25 million tax fraud case against local tobacco wholesaler
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Updated Oct. 9, 2009 - 3:50 PM CST
Evidence is thrown out in the case against a local tobacco wholesaler and his business partners.
Gary Hall of Joplin owns Sunflower Supply Company, a tobacco business in Galena.
Authorities had claimed that Hall and some associates had pocketed millions of dollars in a scheme to avoid paying tobacco taxes.
Investigators claimed in 2006, the Kansas Highway Patrol pulled over a truck carrying more than $200,000 worth of cigarettes without proper documentation and tax stamps.
Now a federal judge has ruled the Highway Patrol stopped that van without proper cause, and the evidence gathered in that stop may not be used in the case.
Updated Feb. 26, 2009 - 3:29 PM CST
A federal judge says Gary Hall can pay the legal fees of his co-defendants and they can share the same attorneys.
Prosecutors contend the Hall, 66, of rural Joplin, committed tobacco tax fraud against Oklahoma and American indian tribes.
Hall and seven other people and three businesses face a 43 count federal indictment alleging mail fraud, wire fraud, and money laundering resulting in the diversion of $25 million tax dollars.
Last updated Oct 17, 2008 - 04:44 PM CST
ELIZABETH MATTHEWS and JORDAN AUBEY contributed to this report
Federal agents move into Galena, Kansas as a local business owner and his associates are charged in a 43-count federal indictment.
The Four State cigarette wholesaler has been charged in a $25 million dollar fraud scheme. Seven of the eight defendants charged in Friday's indictment live in either Galena or Joplin.
Gary Hall, president of Sunflower Supply Company in Galena, was transported with his employees to Wichita on Friday.
The 43-count indictment includes ten counts of mail fraud, seven counts of wire fraud, with one involving nearly $1 million.
Federal prosecutors are charging the Sunflower Supply Company with a fraud scheme worth nearly $25 million. This sum is a loss for the state of Oklahoma and indian tribes in tax revenue on cigarettes.
Department of Justice Special Agent Michael Schmitz said this is not the first bust on the Four State company.
"It all started with a vehicle stop by the Kansas Highway Patrol," Agent Schmitz said. "They in turn got a hold of ATF, and then we in turn got the Internal Revenue Service involved."
Authorities say a vehicle stopped in Coffeyville in 2006 was carrying over $200,000 worth of cigarettes without the necessary tax stamps.
The Bureau of Alcohol, Tobacco, Firearms, and Explosives then began its investigation.
In May 2007, the IRS and the ATF raided the offices of the Sunflower Supply Company and confiscated computers.
Others charged in the indictment on Friday are:
The owner of Sunflower Supply Company, Gary Hall, is well known to many people throughout the Four States.
Hall, 66, owns properties in both Kansas and Missouri, and has donated money to a local hospital.
Besides the Sunflower Supply Company in Galena, Gary and his wife, Donna, also own two properties in Joplin.
As part of the government's indictment, the couple's BMW, Beachcraft airplane, and a van were confisicated.
The couple recently made a gift of $4.5 million to the Freeman Hospital's new west tower, which was named after the couple.
Both Gary and his wife share their time between homes in Joplin and Las Vegas.
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