02/29/2012 11:37 am ET

Rabbi Meshulam Rothschild Arrested In Massive Illegal Cigarette Scheme

A Brooklyn rabbi could face up to 15 years in prison after being busted for selling illegal cigarettes. Rabbi Meshulam Rothschild is said to have cheated New York state out of nearly $200,000 in taxes, The New York Post reports.

Rothschild, a leader of the Pupa Hasidic sect and an assistant to Pupa Rebbe, was arrested in a raid conducted earlier this month by the Brooklyn DA and the Bureau of Alcohol, Tobacco and Firearms on Spencer Street in Williamsburg.

He's accused of buying untaxed cigarettes en masse in Virginia, and then bringing them back to New York where he'd pawn them off to stores in Chinatown and other bodegas throughout the city--a practice, smokers will know, that is likely the genesis of "loosies" and 8-dollar packs. The average price of a pack of cigarettes in New York is $12.50.

The rabbi reportedly sold 3,600 cartons of cigarettes a week.

Additionally, when storeowners became weary of Rothschilds goods because they lacked the necessary tax stamp and refused to buy them fearing they were fakes, the resourceful rabbi sent the cigs back to Virginia where he then imprinted them with a phony tax stamp. Thus, the rabbi has also been "charged with criminal possession of a forged instrument for allegedly possessing more than 11,000 phony tax stamps from the Old Dominion state."

Also arrested in the raid were "Nasmi Havolli, 51; his son Nart, 20; and Nasmi’s nephew Blerim, 24."

In other cigarette smuggling news, three more former NYPD cops plead guilty Monday to being involved a smuggling ring that, while also selling thousands cartons of cigarettes, also sold guns and stolen slot machines.

In April of 2011, "Operation Smokeout" in Queens, conducted by the Queens DA, nabbed 12 people for selling illegal cigarettes, shortchanging the state by $300,000 in taxes.