Tobacco seizures decrease despite high profile arrests

A number of well-publicized arrests for tobacco smuggling took place in the lead up to the passage of new laws criminalizing the trafficking of contraband tobacco. However, the amount of tobacco seized in Ontario and Quebec during that time actually decreased from the previous year, according to an internal RCMP report.

On April 30th, Police announced they had dismantled a Tobacco smuggling network in which members of the Italian Mafia sold tobacco to manufactures in Kahnawake. The Mounties coordinated with Quebec’s provincial police and border officials from Canada and the US in the operation, which saw 35 arrests and the confiscation of 40,000 kg of Tobacco.

The operation made headlines across Canada, but despite the news coverage, the RCMP actually had a 14% decrease in the number of tobacco seizures made in the first half of 2014, compared to the same period the previous year, according to a report acquired through an Access to Information request.

A spokesperson for the Mounties said that while they “welcome tools and the laws to facilitate their work,” the RCMP “does not time arrests to influence the legislative process.”

“Success in the area of prevention is not reflected via number of seizures,” added the spokesperson in an email to Two-Row Times.

The report, by the RCMP’s Contraband Tobacco Unit, speculates, “Outreach initiatives, particularly in the Cornwall/Akwesasne area could be having an effect on local demand for contraband tobacco products.”

Another reason for the decrease cited in the report is a focus on organized crime, as “these investigations tend to be lengthier and generally lead to fewer products seized [but] disrupt higher levels of the distributions chain within the illicit tobacco market.”

The RCMP told Two Row Times that, “A recent increase in domestic tobacco crops, may also partially account for a decrease of cross-border seizures, as some domestic crops may be diverted to the illicit market.”

As the U.S. increases taxes on tobacco, the contraband cigarette market is expanding there, as well, and a greater share of U.S.-grown tobacco is remaining south of the border. This has led to an increasing amount of Ontario-grown tobacco ending up in untaxed cigarettes here in Canada.

However, the RCMP document notes, “The average size of each fine-cut tobacco seizures has decreased, but that the number of events has increased.” One factor contributing to this trend is explained by reports received by the RCMP that, due to lower cost of fine-cut tobacco, “manufacturers in Kahnawake are finding it more profitable to purchase fine-cut tobacco transiting through Akwesasne rather than already-made cigarettes.”

Quebec and Ontario combined accounted for the bulk of Cigarette seizures in Canada between January and October 2014. In this region, the RCMP confiscated 12.4 million cigarettes, 75% of the total across the country.

Although there was a decrease of cigarettes seized in these two provinces, the amount of tobacco apprehended in other parts of the country increased.

The Maritime Provinces saw 2 million individual cigarettes seized, 13% of the total. A million of those cigarettes were apprehended on March 3, 2014, by a Cape Breton, Nova Scotia-based RCMP unit.

In the North West Region, which includes Manitoba, Saskatchewan, Alberta, just under 2 million cigarettes were confiscated, 11% of the total. 950,000 cigarettes were seized on January 22, 2014, in a joint operation between the RCMP and Manitoba Finance, which was assisted by the Dakota Ojibway Police Service.

In the Pacific Region, the RCMP confiscated only 14 bags of 200 cigarettes.

The report speculated that the amount of Tobacco seized would increase in the second half of 2014 as the RCMP has reallocated resources to create a 50 member Anti-Contraband Force, and as Bill C-10 neared royal assent, the RCMP were working “to develop training for front line members who will be additionally tasked with enforcement of the proposed amendment to the Criminal Code.”

It is not clear if the amount of tobacco seized did, in fact increase, as the Mounties declined to provide any statistics beyond those acquired through an Access to Information Request.

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