Sec. 72.3. Cancellation or suspension of a license as a wholesale dealer of cigarettes

Tax Law, §§ 480, 482-a, 484(a), 1081(c) and 1094

(a) The license of any wholesale dealer of cigarettes may be cancelled or suspended by the Department of Taxation and Finance pursuant to the provisions of this section. A determination as to whether a license should be cancelled or suspended and the duration of suspension will be made by the department on the basis of the circumstances in each case. The department may, in its discretion, continue such license upon such terms and conditions as it may deem necessary for the protection of the revenue under article 20 of the Tax Law and the cigarette marketing standards contained in article 20-A of such law.

(b)

(1) Generally, a license as a wholesale dealer of cigarettes will not be cancelled nor suspended unless the dealer has had an opportunity for a hearing prior to such action (see subdivision [c] of this section for exceptions). A license may be cancelled or suspended upon a licensee's:

(i) failure to comply with any of the provisions of article 20 or article 20-A of the Tax Law or any rule or regulation adopted pursuant thereto (see also Article 2 of this Subchapter); or

(ii) knowingly aiding and abetting another person in violating any of the provisions of such articles or of such rules or regulations.

(2) A license as a wholesale dealer may also be cancelled or suspended if it is determined that the licensee or any “controlling person” as defined in section 72.2 of this Part:

(i) has committed fraud or deceit in operating as a wholesale dealer or has committed fraud or deceit in procuring a license as a wholesale dealer of cigarettes;

(ii) has been convicted in a court of competent jurisdiction, either within or without the State of New York, of a felony bearing on the licensee's duties and obligations under any article of the Tax Law;

(iii) has impersonated any person represented to be a wholesale dealer of cigarettes pursuant to article 20 of the Tax Law but who has in fact not been so licensed; or

(iv) has knowingly aided and abetted the sale of cigarettes by a person which such licensee or controlling person knows has not been licensed as a wholesale dealer of cigarettes by the Department of Taxation and Finance and who is a wholesale dealer as defined in section 70.2(h)(2) of this Title.

(c) A license as a wholesale dealer of cigarettes may be cancelled or suspended prior to a hearing if the Department of Taxation and Finance believes that the assessment or collection of any tax imposed by article 20 of the Tax Law will be jeopardized by the delay of such cancellation or suspension.

(d) If a wholesale dealer's license is cancelled or suspended, such former dealer or suspended dealer of cigarettes is prohibited from conducting any activities as a wholesale dealer of cigarettes in New York State. Upon notice of cancellation or suspension, a former or suspended wholesale dealer must immediately surrender its certificates of license as a wholesale dealer of cigarettes to the Department of Taxation and Finance. Immediately following the effective date of cancellation or suspension all appropriate returns or reports must be filed with the department.