Tobacco.org

LETTERS: High Taxes Discourage Consumption, Boost Smuggling 

Quebec and NY to exchange border information 

Quebec and New York have intensified their battle against terrorism and crime, agreeing to exchange information about people who cross their borders.

"That information needs to flow continuously," Michael Balboni, New York's deputy secretary for public safety, told reporters today. "That is what we are doing."

Balboni explained that U.S border authorities already have the names and destinations of everyone crossing from Quebec into New York State. But the border authorities do not communicate that information to police forces in the state. . . .

Dupuis said Quebec is concerned about the illegal flow of weapons and contraband tobacco from south of the border.

The Americans are worried about the smuggling of marijuana and other drugs from Canada.

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KING: Tobacco and Terror  

As Ranking Member of the Committee on Homeland Security, I am acutely aware of the threats our nation faces from international terrorism. But even I was taken aback a few months ago when New York State Law Enforcement officials approached me about a possible terrorist nexus as close as the neighborhood convenience store.

Recent investigations suggested a disturbing trend: that well-organized cigarette smuggling operations are sending millions of dollars in profits annually to the Middle East, possibly to our enemies. I immediately ordered my staff on the Committee to investigate the matter further, and what they found is disturbing.

The report released by the Committee this week, entitled "Tobacco and Terror," found that New York State's refusal to enforce certain tax laws has created a market where cigarette smugglers can operate without fear of reprisal; and even worse, these smugglers are indeed sending a large portion of their profits to groups such as Hamas and Hezbollah.

It all starts with New York State's decision to turn a blind eye when it comes to the resale of cigarettes on the state's Native American Indian Reservations.

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• Seneca President Says Nation Not Part Of Black Market 

Representative Anthony D. Weiner, D-Brooklyn, a member of the House Judiciary Subcommittee on Crime, Terrorism and Homeland Security, authored legislation to make cigarettes and smokeless tobacco products non-mailable matter. The legislation was reviewed by the subcommittee Wednesday.

''Black market sales of tobacco via the Internet, the money form which has a history of being funneled to terrorist groups, will soon become a thing of the past when cigarettes and smokeless tobacco products become non-mailable,'' said a news release from Weiner's office.

Numerous Seneca entrepreneurs conduct business via the mail and Internet, selling cigarettes tax-free.

''The tobacco products that are sold from Seneca Nation businesses must not be confused with 'black market cigarettes,''' said Seneca Nation President Maurice A. John Sr.

''The Nation will not abide by attempts on any front to criminalize our businesses or economy,'' he said.

The Seneca Nation has established the Import-Export Law, which regulates the cigarette trade in Seneca territories, he said. He said the Nation works ''hand in glove'' with ATF, and local, state and federal law enforcement agencies to prevent cigarettes from ever reaching the black market.

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Buffalo News Editorials: Don’t tie Indians to terrorism 

But that isn’t stopping New York Congressman Peter King from trying to draw attention to the problem of cigarette smuggling by tying it to international terrorism.

It’s a reach. But the downstate Republican has a point or two to make. The best one is that New York State ought to get around the never-ending standoff over collecting taxes on tobacco products sold on Indian reservations by taxing the smokes before they ever see tribal land. . . .

There are cases where people have been convicted of smuggling cigarettes in New York and the feds concluded that at least some of the money they had been making found its way into the hands of Islamist terrorist groups such as Hezbollah or al-Qaida. Still, waiving the bloody shirt of Islamist terrorism as inspiration for settling a long-standing tax dispute is risky. . . .

King’s suggestion that the state levy its tax take from the cigarette wholesalers, thus skirting the issue of impinging on tribal sovereignty, is one that appeared in this space years ago and still makes sense.

But not, please, in the name of fighting terror.

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Report links cigarette smuggling to terrorists 

Congressional Republicans issued a report Tuesday saying cigarette-smuggling rackets originating on New York's Indian reservations are transferring huge sums of money to Middle East terror groups -- but the Seneca Nation of Indians took issue with just about every part of the study.

The report, released by Republicans on the House Committee on Homeland Security, is based largely on interviews with state and federal law enforcement officials and events that happened years ago.

It offers no new large-scale evidence of cigarette money flowing to terrorists, but it includes plenty of speculation about the potential ramifications of cheap tax-free cigarettes being smuggled off the reservation.

"In total, law enforcement officials in New York State estimate that well organized cigarette-smuggling networks generate between $200,000 and $300,000 per week," said the report, which was commissioned by Rep. Peter King, R-Seaford.

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Cigarette Smugglers Funnel Money to Terror Groups, Report Finds  

Cigarette smuggling is generating millions of dollars every year that can be reaching terrorist groups, including Hezbollah, Hamas and Al Qaeda, according to law enforcement sources. In a single case, $100,000 was sent to Hezbollah.

A 15-page report congressional report, obtained by FOX News, includes intelligence from law enforcement as well as New York State's Department of Taxation and Finance. . . .

"The State is losing hundreds of millions of dollars in tax revenue; and given the current budget shortfall, this would seem to be more than enough reason to put the so-called policy of forebearance out of its misery," King said.

"But this is more than just a matter of lost revenue. It is a matter of national security. Cigarette smuggling in New York State must be brought to an end immediately."

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Report: Cigarette smuggling costs state millions  

A congressional report being released today charges that New York State loses millions of dollars a year in unpaid sales taxes on smuggled cigarettes.

Rep. Peter King (R-Seaford) called for an investigation and hearings into the lost revenue - money that King says in past cases has been funneled by smugglers to terror groups overseas.

King, who requested the report by the Republican staff of the House Homeland Security Committee, faults New York State government for not enforcing its own cigarette tax laws, particularly on Indian reservations - reporting that the state lost as much as $576 million in 2004 alone including from purchases on reservations.

"We've been talking to state investigators and law enforcement ... and there's definitely a nexus between the cigarette sales and the terrorist organizations,"

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Congressional report on sale of bootleg cigarettes 

A new congressional report obtained by WIVB News paints a picture of New Yorkers unwittingly funneling millions of dollars to terrorist organizations through the sale of bootleg cigarettes.

The report suggests that the continued sale of tax free cigarettes on Indian reservations in Western New York has been used as a pipeline to raise funds for Hamas, Hezbollah and Al Qaeda.

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Report says Indian cigarette smuggling funds terrorism 

Cigarette-smuggling rackets originating on New York's Indian reservations are resulting in huge sums of money being transferred to Middle East terror groups, according to a report issued today by Republicans on the House Committee on Homeland Security.

"In total, law enforcement officials in New York State estimate that well-organized cigarette smuggling networks generate between $200,000-$300,000 per week," said the report, which was commissioned by Rep. Peter King, R-Seaford.

"A large percentage of the money is believed to be sent back to the Middle East, where it directly or indirectly finances groups such as Hezbollah, Hamas and al-Qaida."

The report, based largely on interviews with state and federal law enforcement officials, offers no new large-scale evidence of cigarette money flowing to terrorists.

Instead, it recounts the 2003 case of two women from the Seneca Nation of Indians who were sentenced for their role in a smuggling ring that ended up profiting a Hezbollah-linked network in Dearborn, Mich.

The study also sites the "Lackawanna Seven,"

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• New Yorkers May Be Unintentionally Funding Terror Organizations  

A new congressional report obtained by News 4 New York paints a disturbing picture of New Yorkers unwittingly supplying millions of dollars to terrorist organizations.

The money pipeline begins with the sale of bootleg cigarettes.

The report from the ranking Republican on the House Committee on Homeland Security will be released Tuesday. In it are allegations that cigarettes that begin at Indian reservations in New York end up generating millions of dollars for Hamas and Hezbollah unbeknown to smokers just looking for a bargain.

As a New York City smoker, Mike Esposito said he gets tired of paying $7.50 for a pack of cigarettes. He said sometimes he will buy cigarettes at a tax-free Indian reservation.

Rep. Peter King, R-N.Y., was critical of the practice.

"No such thing as a free ride, a free meal or a free cigarette," he said. "You're getting that cigarette at a much-reduced price; be concerned the profits are going to fund America's enemies, Hamas and Hezbollah." . . .

His staff just wrote a report titled, "Tobacco and Terror," which concludes from cigarettes alone, "A motivated terrorist cell could generate sufficient funds to carry out another Sept. 11th style attack, which operational costs were estimated to be $500,000."

King said bootleggers, mostly immigrants from the Middle East, buy truckloads of cigarettes on reservations outside Buffalo and then sell them downstate.

They send the huge profits back home, according to federal authorities.

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• Tobacco and Terror (PDF) 

Prepared by the Republican Staff of the U.S. House Committee on Homeland Security U.S. Rep. Peter T. King (R-NY), Ranking Member
. . .

Recent law enforcement investigations, however, have directly linked those involved in illicit tobacco trade to infamous terrorist organizations such as Hezbollah, Hamas, and al Qaeda.1

These startling discoveries led U.S. House Committee on Homeland Security Ranking Member Peter T. King (R-NY) to launch an investigation of the issue. The following staff report--which will focus on the estimated millions of dollars in illicit tobacco profits being funneled to terrorist groups overseas as well as New York State's refusal to enforce tobacco laws--is the result of numerous interviews with law enforcement officials at the local, State, and Federal level, as well as open-source research. . . .

Conclusion

Experts have long acknowledged that terrorist organizations such as Hezbollah "depend on a wide variety of criminal enterprises, ranging from smuggling to fraud to drug trade to diamond trade in regions across the world,"" including the United States. Terrorist organizations rely heavily on their global web of illicit enterprises to financially support their recruiting, training, arming, and operational objectives. As law enforcement agencies continue to combat terrorist and criminal fundraising schemes, these criminal groups will continue to adapt and exploit emerging vulnerabilities. The ability of these groups to engage in low-risk, cash-based schemes such as cigarette smuggling are critical to the continuation of their operations. The more than $50,000 in profits that smuggling rings can generate from one contraband load (1,500 cartons) is enough to fund as many as 10 USS Cole bombing operations. In just two months of illicit cigarette trade operations, a motivated terrorist cell could generate sufficient funds to carry out another September 11th style attack, in which operational costs were estimated to be $500,000.38

Law enforcement agencies face a daunting task of keeping up with these ever-changing criminal schemes. Simply put, they need more help from State and Federal governments. The last few years have seen a boom in cigarette smuggling around the world and here in the United States; and, thanks to its policy of forbearance, New York State is doing more to facilitate this trade than any other State in the union. On June 3, 2008, New York State taxes on cigarettes are set to increase by another $12.50 per carton. This will only serve to increase the demand for illicitly smuggled cigarettes and inflate the profit margin of these smuggling networks.

This must be brought to an end. It is more than just a matter of hundreds of millions in lost tax revenue-it is a matter of national security.

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O'NEILL: Why are we ignoring organised crime?  

More than 700 people are killed by heroin in Britain every year . . .

Terrorism, by contrast, killed no one in Britain last year, nor the year before and has not claimed a life since July 7, 2005 . . .

The heroin trade is the most easily illustrated example of how organised crime operates today. The business of producing, smuggling and selling heroin employs thousands of people around the world: poppy farmers in Helmand, Afghan warlords, corrupt politicans, police and border guards across many countries, Iranian truck drivers, Turkish drug barons, Dutch wholesalers, British distributors and street-corner dealers.

But crime bosses do not limit their activity to drugs. They are businessmen, constantly diversifying into new markets in pursuit of profit. They have trafficked thousands of women and girls into Britain and coerced them into the sex industry; the smuggling of illegal economic migrants occurs on an even larger, and more profitable, scale; a booming trade goes on in contraband cigarettes and counterfeit designer goods; £15 billion of criminal profits is laundered through the British economy each year; and systematic fraud accounts for some £20 billion annually. This extensive shadow economy is underpinned by the trade in illegal firearms - an essential enforcement tool for any serious criminal.

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• PDF: How Cigarette Smuggling is Funding our Enemies Abroad 

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Council uses terror laws to spy on underage smokers 

A MIDLAND council is using laws designed to combat terrorism to spy on kids they suspect of underage smoking and drinking.

Staffordshire County Council has carried out nearly 70 surveillance operations across the county in the last three years.

Trading Standards officers secretly filmed underage kids smoking and drinking during some of the investigations - and used informants to identify rogue shopkeepers who sold them the fags and booze.

The council snoops used the Regulation of Investigatory Powers Act (RIPA) to tackle the petty offences, yet the legislation was originally designed to prevent terrorism and serious crimes.

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