NYC: Poospatuck illegal cigarette sales on tape

Amid heated legal and political wrangling over untaxed tribal cigarette sales, New York City Mayor Michael Bloomberg Thursday released new undercover video of illegal purchases at two smoke shops on Long Island's Poospatuck reservation and called for stiff enforcement of a new state law to stifle the loss of millions in state and city taxes.

"The sovereignty of Native Americans has been exploited to fill the pockets of bootleggers and crooked cigarette dealers," said Bloomberg. He was flanked by top advisers and a pile of 60 green-and-white cartons of what officials said were illegally purchased Newport 100 menthols as he played the video in a Blue Room news conference.

The footage, which the city said was taken last week, showed investigators at the Unkechaug (Poospatuck) Nation reservation in Mastic buying the cartons of untaxed cigarettes - which are supposed to be sold only to tribal members for personal use - after telling clerks that they planned to resell them in the city.

"I don't want to know any information that you're talking about because our cigarettes are for personal use," said a clerk at one store before taking $1,500 in cash from the undercover agent. "Should I know that you're going to resell them, I can get in trouble. So, the less I know the better."

New York City got an injunction against eight reservation smoke shops last year, but Bloomberg said 49 new ones are now operating and have sold more than 4 million cartons of untaxed cigarettes this year - more than 523 packs a day for every one of the 296 residents living on the reservation.

A state law passed over the summer requires wholesalers to collect state taxes before selling to reservations, and Bloomberg has urged Gov. David A. Paterson to enforce it with a "cowboy hat and a shotgun" - provoking criticism from some tribes.

The Unkechaugs filed suit in federal court in Buffalo last week, seeking to join two upstate tribes that got an order temporarily blocking the law as an infringement on their sovereignty. The city Thursday filed papers in court opposing the tribe.

Another tribe - the Mohawks - Thursday were also granted a temporary restraining order preventing the state from collecting taxes off their cigarette sales.

Unkechaug Chief Harry Wallace, in a statement issued Thursday, said the tribal council did not approve of illegal sales by shops and would investigate the episodes in the video. But he blasted Bloomberg for a "scorched earth" assault triggered by the tribe's role in urging protests of the mayor's "cowboy" remark. Wallace characterized the mayor's statement as "an outrageous call to violence."

"We know this edited YouTube presentation is part of an ongoing media campaign directed solely against us to discredit the Unkechaug, to call us names and to attempt to legislatively terminate our sovereignty," Wallace said. ". . . Now the mayor is retaliating instead of apologizing for his indefensible statements."New York's state tax on cigarettes increased by $1.60, to $4.35 a pack, on July 1. The city tax is $1.50 a pack. City officials estimate that statewide, untaxed tribal cigarette sales cost $1 billion in taxes. In tight fiscal times at all levels of government, Bloomberg said, "We can't afford it."