NJ Department of the Treasury
Division of Taxation
Office of Criminal Investigation
Special Agent in Charge
Charles Giblin
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Protecting the Revenue
since 1973
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N.J.O.C.I.

State Law Enforcement Unit

OCI over 50 employees
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4 offices across the State

Freehold, Hackensack,
Mercerville, Cherry Hill w/ DCJ
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N.J.O.C.I.

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Enforcing nearly 50 taxes &
2C Criminal Code
Oversight of a number of industries:
Motor Fuels, Tobacco, Alcoholic Beverage relative to
taxation of product

Division EOC / Homeland Security

Professional Responsibility cases
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Unprecedented Growth
Over the past years OCI has grown
significantly in personnel & equipment…
 Number of cases and prosecutions….
 Areas of responsibilities….
 Scope of investigations….
 Investigative relationships….

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Who We Are & What We Do
1. Established in 1973 with the creation of the
Special Agent title series.
2. First area of responsibility was rampant
cigarette smuggling.
3. Late 80’s thru early 90’s was the Motor Fuels
Era. Russian Organized Crime.
4. White collar crime task force of Forensic
Auditors, Civil Investigators and Special
Agents.
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Who We Are & What We Do
5. Re-organized June 2010 with law
enforcement command.
6. Now four units: Special Investigations,
Financial Investigations, Technical
Enforcement Unit & Internal Security.
7. Special Agents work round the clock 24/7, all
days of the week, subject to immediate recall.
8. SA’s Essential Employees / First Responders
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Special Investigations Unit
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NJ OCI — Training
TRAINING
All Special Agents must complete the Basic Course for
Investigators as required by the NJPTC @ NJDCJ Academy.
All non-sworn personnel must attend a “modified” BCI.
Classroom, some practical's but not firearms, DT, PT. Must pass
all written exams.
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NJ OCI — Training
TRAINING
We provide certified instructors to other
academies for PT, firearms, wmd, haz mat,
ems
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NJ OCI — Training continued. . .

In-house we maintain certified NJPTC
firearms, OC and baton instructors.
All non-
Qualifications 4x year: handgun,
patrol rifle, shotgun. 2X baton, OC.
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In Service Training

All SA’s must attend NJ TOP GUN
we provide faculty and operational support
Selected SA’s
attend NJ UNIT
For U/C work
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Contraband Operations
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Examples of SIU Cases
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Hijacked loads
Distributors /Burglary
(stamping agents)
Organized
smugglers
Export Diversion
from containers /
ships
Involving cigs,
tobacco & alcohol
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International connections
Manufactured in China: verification requires
intimate knowledge of manufacturers standards,
printing, configurations, product codes, sourcing, etc
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Surveillance Ops

Everything from electronics, pole
cameras…GPS Tracking, using our own
equipment and MAGLOCLEN
Interstate 95 Corridor initiative
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K-9 Tobacco Detection

Joint initiative with NJ State Fire Marshal
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NJ Treasury & Counterfeiting ?

It’s a long history…….
NJ Treasury note
 1761!
 Penalty: “to counterfeit
is death”!

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Counterfeiting
In fiscal year ‘15 over
Half a million in $ value of counterfeit
NJ stamps seized prior to application
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Terrorism Nexus
Joint “National
Security” cases
with DHS/HSI
NJOHSP, FBI
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Terrorism Nexus
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Motor Fuels
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National Problem, but NJ’s rate is low & a source state
New legislation reverted to 90’s format where tax paid
at the rack (the storage yard)
Intell indicates former eastern bloc nationals ,moving
back into smuggling.
Many current schemes are more thefts
and skimming.
There have been
adulterated fuels.
Counterfeit branding
Treasurer has authorized new field enforcement unit
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Alcoholic Beverages
Untaxed liquor – smuggled from lower
tax states
 Counterfeit liquor – adulterated product
very sophisticated operations to support
 International connections
 Could be health concern
 No tax stamps

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Other Tobacco Products
counterfeit
Ever increasing volume, No
stamps. Most smuggled item!
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Emergency Management
Special Agents are part of Treasury ERU
 Alert & Warning
 EOCs (State, Dept, Div)

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Internal Security Unit
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Internal affairs for
3,000+/- employees
Control U/C accounts
Audit C/I program
Drug testing for SA’s
Sovereign Citizens*
Professional Responsibility
T
(all employees receive integrity training)

All background investigations
*All Treasury personnel receiving “awareness” training.
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Task Force Assignments
Joint Terrorism Task Force
Prosecutors Office
SIRF – Stolen Identity Refund Fraud
Trenton Tide, Newark Tide, Paterson Tide
are all SA details with NJSP
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Other programs

Special Agent / Intell Officer assigned to
the NJ Regional Operations Intelligence
Center aka the ROIC.
Goal to evaluate financial crimes
with tax implications as well as
contraband intell & response.
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Other programs

Special Agents provide “operational
security” to Civil Compliance
Investigators who are conducting civil
seizures with high threat situations /
locations.
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Other programs

Sovereign Citizens

Monitor Div of Revenue: UCC filings
against LEO’s.
 Coordinate intell with:
NJOHSP / SARS
FBI
NJSP
Judiciary
NJ Division of Criminal Justice
NJ Division of Law
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Prosecutions
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Municipal Court
Superior Court
Federal District Court
Municipal Prosecutor
NJ Division of Criminal Justice DAG
21 County Prosecutors
Federal / US Attorneys Office
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Forfeiture of $$ and vehicles….
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We seize $$, vehicles, equipment, anything
related to the criminal acts.
Not just under contraband cases but
applicable to all our prosecutions.
Must be used for law enforcement purposes
Controlled by NJ Office of the Attorney
General
Revenue sharing with all joint Federal cases
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Financial Investigations Unit
Special Agents now
assigned to work in
FIU matters.
 Forensic Auditors
working traditional
“white collar” tax
offenses.
 Priority-SIRF cases

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Financial Investigations
Some Sample Areas of Investigation
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Tax Fraud
Mortgage Fraud
Organized Crime
Counterfeit Goods
Human Trafficking
Insurance and Medicare/Medicaid Fraud
Official Corruption referrals
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Financial Investigations
Investigative Tools We Use:

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FinCEN
Lexis Nexus/Accurint
NCIC/CJIS
RCFL
MAGLOCLEN
SSA
FBI LEO
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NJ DOL; SOS
Registrations
Data Warehouse
Division Database
NWC3
Task Force Intell
EPIC
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Financial Investigations
Considerations in Prosecuting
Criminal Tax Cases continued. . .

All indictable cases brought by OCI are
prosecuted either by the Attorney Generals Office
(NJDCJ) or one of the 21 county prosecutors
offices. Except: Cigarettes, Fuels, Alcohol cases.

We can use either the NJ Uniform Tax Code in
particular the Post Amnesty Act (Title 54:52-1 et
seq) that set forth a format for these offenses as
well as the NJ Criminal Code. They are used in
tandem frequently.
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Financial Investigations
Considerations in Prosecuting
Criminal Tax Cases continued. . .
Unlike federal criminal tax statutes, New Jersey
does not have a statute criminalizing the
filing of false or fictitious claims against the
State.
Theft by Deception (NJSA 2C:20-4) and Money
Laundering (NJSA 2C:21-25b(2)(a) have
been charged in previous cases involving
theft of State funds by means of filing
fictitious tax returns.
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Financial Investigations
Considerations in Prosecuting
Criminal Tax Cases continued. . .
Fraudulent Return Cases: Unreported Income,
Overstated Deductions/ expenses. Taxpayers’
signature is evidence of knowledge inferred.
Declaration under Penalty of Perjury.
(gradient crime)
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Financial Investigations
Identity Theft –Refund Fraud Matters
•
Return Mills
• Individual operators
• Postal Employee Cooperation
• Reloadable cards
• IRS-CI, OCI, DCJ & NJSP Cyber Crimes initiative
• Identified gangs involvement
• Avoidance of filing with IRS but using stolen identities
across other states.
• Our Special Frauds Unit uses Human Intell for review
of refund check runs.
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Financial Investigations
Identity Theft –Refund Fraud Matters
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Financial Investigations
Considerations in Prosecuting
Criminal Tax Cases continued. . .

Sentencing is based upon the NJ Criminal
Code (Title 2C)

Second or plural offenders subject to doubling
of the criminal penalty!

Restitution includes all taxes evaded or
avoided, full civil penalty and interest.
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Financial Investigations
Gradation of Theft Offenses under the
NJ Criminal Code.
(Theft & Computer Criminal Activity Offenses NJSA 2C:20-2)
1st degree more than $500,000


$200,000 fine and/or up to 10-20 years
imprisonment. Incarceration is presumed.
2nd degree $75,000 to $500,000


$150,000 fine and/or up to 5-10 years
imprisonment
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Financial Investigations
Gradation of Theft Offenses under the
NJ Criminal Code.
(Theft & Computer Criminal Activity Offenses NJSA 2C:20-2)
3rd degree more than $500 less than
$75,000


$15,000 fine and/or up to 3-5 years imprisonment
4th degree….. in tax cases usually a
downgrade
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$10,000 fine and / or not to exceed 18thmonths
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Technical Enforcement Unit
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Reviews Bad Checks and bad Electronic Fund
Transfers (EFT’s) used to pay State taxes & fees.
Signs criminal complaints in Municipal & Superior
Court. (act occurs in Office of The Director under
NJSA 54:29A-72)
Target of enforcement are multiple offenders, noncompliant, multi-levels of internal controls, large $$
value
Top Debtor Program / Uncooperative with Civil units
Change in law to reflect technology “bad” EFT’s (9/’14)
Joint effort with Mercer County Prosecutors Office
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Narcotics Investigations
NJOAG has asked us
to participate in
support of narcotics
financial cases thus
we belong to County
Narcotics
Commanders
Association and NJ
NEOA.
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Specialized Investigations
*Extra ordinary authority to enter
business to examine books records,
finances.
Illegal income is taxable & must
be reported as income. However……
we have to look at the calendar. April
15th returns are due…just like everyone
else. Extensions?
.
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Specialized Investigations
When was the money made?
Where is it maintained / kept? ?
Reinvested in legit business? ?
Freeze Accounts??
Who are the principals, real owners, etc.
Not always who you think!
Joint criminal investigations necessary
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Specialized Investigations
Where is the
money
going…..?
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Related Investigations
Business
Locations:
we can share
license
Information.
But not tax info unless
joint investigations
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Who we work with….
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Contacting Us…..
PO Box 284 Trenton, NJ
08695
Hqs: 609 588 5017 Mon-Fri
0800 1630
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Thank You…
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