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Houston Man Added to EPA’s Fugitive List / Man pleaded guilty to tax fraud resulting from illegal fuel blending scheme

Release Date: 06/22/2010
Contact Information: Stacy Kika, [email protected], 202-564-0906, 202-564-4355

WASHINGTON — The U.S. Environmental Protection Agency has added Yousef Ishaq Abuteir of Houston, Texas to the agency’s fugitive Web site for failing to appear for scheduled court proceedings. Abuteir pleaded guilty to conspiring to impede the Internal Revenue Service (IRS) from the collection of federal fuel excise taxes. EPA initially investigated the case for potential violations of the Clean Air Act arising from Abuteir’s purchase of kerosene and jet fuel, illegally blending it with other materials and later selling it as diesel fuel in the Houston area.

“Those who are charged with violating the law must have their guilt or innocence determined in a court of law,” said Cynthia Giles, assistant administrator for EPA’s Office of Enforcement and Compliance Assurance. “The public can help EPA achieve its mission by reporting any information they have on Mr. Abuteir or other fugitives.”

Abuteir was one of three individuals who pleaded guilty to a scheme to defraud the IRS of millions of dollars in federal fuel excise taxes. Between July 2002 and November 2003, Sidney Berle Baldon II, owner-operator of Mid-Coast International, and Tracey Dale Diamond, an officer of the company, purchased more than $10 million of jet fuel from Calcasieu Refining Company. Baldon falsely represented in letters to Calcasieu that the jet fuel being purchased was for export to Mexico and as a result, Mid-Coast paid no federal excise taxes. Mid-Coast transported the untaxed jet fuel from Louisiana to locations owned by Abuteir in Houston and Channelview, Texas, where the jet fuel was then illegally blended with other materials including middle distillate oil, a byproduct of asphalt production. Abuteir instructed drivers to transport the untaxed, blended fuel to retail filling stations in the Houston area where it was sold as taxable motor fuel. Abuteir personally delivered cash to Baldon for the purchase of the jet fuel obtained from Calcasieu Refinery.

On April 14, 2008, Abuteir, Baldon and Diamond all pleaded guilty to one count of knowingly and willfully conspiring to evade federal fuel excise tax laws.

In 2008, the state of Texas also convicted Abuteir for violating state laws related to fuel. Abuteir failed to appear for sentencing and was sentenced in absentia to seven years in prison. A state warrant was issued for his arrest.

On February 2, 2009, a federal arrest warrant was issued for Yousef Abuteir's failure to appear for a scheduled court proceeding.

On May 14, 2009, Baldon was sentenced to 60 months in federal prison and three years supervised release. On May 28, 2009, Diamond was sentenced to 12 months and one day in federal prison and three years supervised release. Baldon and Diamond were also ordered to jointly pay $3.3 million in restitution to the IRS.

Launched in December 2008, EPA’s fugitive Web site contains information about individuals who have failed to turn themselves in after having been indicted and charged with or convicted of violating environmental laws or associated violations of the U.S. Criminal Code. The site also shows the public how to contact EPA if they have information about where a fugitive may be found. To date, information from citizens or law enforcement organizations have assisted in the arrest or capture of four fugitives and the surrender of two other fugitives. Of those, four were sentenced, one was found not guilty, and one, Joseph DeMatteo, is still awaiting legal proceedings. EPA special agents arrested DeMatteo on June 8 in Las Vegas after an individual contacted EPA with credible information about his location. DeMatteo was added to the fugitive list on May 11 after being indicted for criminal violations of the Clean Air Act.

Because some fugitives may be armed and dangerous, the public should not try to apprehend any of the individuals. The Web site contains a form that the public can use to report information related to the fugitive’s identity and/or current location. EPA reviews all reports submitted.

Citizens may also report the information to their local police or, if outside the United States, to the nearest U.S. Embassy.

More information on EPA’s fugitive Web site: https://www.epa.gov/fugitives