The president of a North Carolina cigarette company was barred from the tobacco industry for a decade as part of a federal sentence that includes a year and a day in prison.

Terence P. McLaughlin, president of CLP Inc. of Ayden, N.C., also agreed to pay about $1 million in past-due federal excise taxes.

McLaughlin was sentenced Wednesday in U.S. District Court in Abingdon. In January, he pleaded guilty to mail fraud and to conspiring to violate federal cigarette laws.

CLP, which makes Bridgeton cigarettes, entered guilty pleas as a corporation to the same charges, as did George Chemali, described in court documents as an agent of the company.

Prosecutors said McLaughlin and Chemali under-reported the number of federal tax stamps on cigarettes bound for Virginia and other states, resulting in lower deposits to state escrow accounts. The plan involved labeling tens of millions of cigarettes as being shipped to New York "for reservation sales only," according to a statement released Thursday by the U.S. attorney's office. Instead, the cigarettes were shipped to Virginia and Kentucky and sold there and in Georgia, Tennessee and South Carolina.

CLP also under-reported shipments from its factory by 48 million cigarettes to illegally lower its federal taxes, prosecutors said.

Chemali was also sentenced to a year and a day in prison and banned from the industry for 10 years. CLP was put on probation for two years. And McLaughlin, Chemali and CLP were ordered to forfeit at least $722,000 in a company account.

-- Mike Gangloff