The former owners of a nationwide cigarette store chain have been ordered to pay $10.2 million in restitution, federal officials said Tuesday.
John and Ned Roscoe owned Cigarettes Cheaper!, a chain based in Benicia that once had 800 retail stores nationwide and $1 billion in revenues.
Ned Roscoe, 51, a resident of the Twin Sisters area near the Napa-Solano County line, was convicted Feb. 11, 2011 in federal court of committing 13 acts of bank fraud and 13 counts of making a false statement. Earlier this year, he was sentenced to five years in prison, followed by five years of supervised release. Roscoe is scheduled to report to prison on Monday, federal officials said.
An appeal has been filed, Ned Roscoe said Tuesday.
His father, John Roscoe, pleaded guilty in January 2011 of one count of conspiracy to make false statements to Comerica Bank, federal officials said. Roscoe, 82, of Fairfield, was sentenced to five years of probation with 12 months of home detention.
The restitution included about $8.23 million in principal and about $1.98 million in interest, federal prosecutors said. The restitution order reflected the bank’s losses, partially mitigated by the bank’s liquidation of the defendants’ collateral, the officials said in a written statement.
Both Roscoes have to make an initial payment of $5,000, the news release stated.
Ned Roscoe, who has been assigned to the Federal Correctional Institution in Sheridan, Ore., said he has been placed on a “payment plan.”
He has to make an initial payment of $5,000 by Monday, the day he turns himself in, he said. Then, he’ll owe $25 per quarter while he is in prison, Roscoe said. After his release, Roscoe said he will have to pay $2,500 a month.
While he wants to be respectful of authorities, Roscoe said he “found it very difficult to follow the calculations that were performed by the U.S. Attorney’s office” in reaching the restitution amount.
John Roscoe, who pleaded guilty during jury selection, said that from Aug. 22, 2003, through Nov. 24, 2003, Ned Roscoe “intentionally prepared, or caused to be prepared, falsely inflated valuations of company inventory reported to Comerica.”