June 12, 2008
State liquor inspector pleads guilty in Welch gambling ring case
A state liquor inspector pleaded guilty in federal court Wednesday to tax evasion, admitting his role in a McDowell County gambling ring run out of a Welch pharmacy.
By Andrew Clevenger
Charleston Gazette
A state liquor inspector pleaded guilty in federal court Wednesday to tax evasion, admitting his role in a McDowell County gambling ring run out of a Welch pharmacy.
Jimmy Kamel Hazemey, 67, of Welch, acknowledged that he failed to report more than $64,000 in income from sports betting in 2004, resulting in more than $15,000 of unpaid taxes. According to the charges against Hazemey, he originally reported $17,042 in income and paid $2,196 in taxes for that year.
Internal Revenue Service Special Agent Matthew Schommer testified that between 2001 and 2005, Hazemey failed to declare more than $212,000 of extra income, resulting in more than $50,000 of unpaid taxes.
Hazemey has cooperated with investigators and has since filed amended tax returns, Schommer said.
Hazemey is a longtime friend and associate of Saeed Kamil Deeb, owner of the Citizen's Drug Store pharmacy in Welch. In April, Deeb pleaded guilty to a three-count information, admitting that he conducted illegal business transactions to mask the gambling operation he was running out of his business.
According to an affidavit filed by IRS Special Agent Stephen Rowley in November 2006, Deeb transferred more than $914,000 to banks in places like Switzerland, Israel and the Dutch Antilles between December 2002 and September 2005.
Deeb received wire transfers from foreign banks totaling $1,449,770 between March 2001 and December 2004, the affidavit states.
In order to hide the large transactions from the IRS, Deeb used friends and pharmacy employees, including Hazemey and former girlfriend Sherrie Hickson, to help him move money around in amounts around or just under $10,000, Rowley wrote.
Deeb kept the amounts low to avoid triggering a Currency Transaction Report, Rowley wrote. Financial institutions have to file such a report with the IRS for any transaction over $10,000.
According to Rowley's affidavit, Deeb's longtime accountant, Charles "Bud" Donchatz, began cooperating with investigators in October 2005. In recorded conversations with Donchatz, Deeb said he skimmed roughly $250,000 a year from his pharmacy over a five-year period.
"I mean, uh, this store's makin' so much money an' I can't, uh, know which way to [expletive] pocket all I can, you know what I'm saying?" Deeb said on one recording. "What's the best way to [expletive] finagle money?"
Deeb told Donchatz that he bet up to $80,000 per game on a variety of sporting events.
In addition to placing his own bets, Deeb placed wagers for other people, covering as many as 100 bets at a time, according to the affidavit.
At one point, one of Deeb's "clients," a Welch restaurant owner, owed him $37,000, Deeb told Donchatz.
Deeb's expenditures included $800,000 in renovations to his home and buying the Moose Lodge building in Welch for $90,000. He also owned numerous cars, including a 1999 Lexus LS-V, a 2005 Lexus, a 2002 Mercedes, a 2004 Toyota Tundra, a 1991 Jaguar, a 1951 Dodge sedan and a 1999 Lexus LX.
Deeb also told Donchatz that he bought a 2002 Mercedes S600 for $150,000, the affidavit states.
After Wednesday's hearing, Assistant U.S. Attorney Hunter Smith said the government's investigation into the gambling ring is "ongoing."
U.S. District Judge Thomas E. Johnston scheduled Hazemey's sentencing for Oct. 20. Deeb's sentencing is set for Aug. 4.  |