United stand against threat financing
17 JUL 2017
Today, Wednesday, 19 July 2017, a U.S. Government agency focused on promoting human rights, military security, and economic cooperation in Europe, Eurasia, and North America, will hold a special hearing: “A hazy crisis: Illicit cigarette smuggling in the OSCE region.”
The Commission on Security and Cooperation in Europe, commonly known as the Helsinki Commission, is an independent agency of the U.S. Federal Government. For 40 years it has monitored compliance with the Helsinki Accords, which were established to improve relations between the Communist bloc and the West.
This hearing is a big deal. The issue of illicit cigarette smuggling in the Organization for Security and Cooperation in Europe (OSCE) region and its implications has never been the subject of a hearing of this nature.
It is widely reported that illicit trade in tobacco is a significant source of funding for terrorism and transnational organized crime, threatening global security and destabilizing key regions of the world. Having the U.S. take a more pivotal role in efforts to combat the problems of global illicit tobacco trade, and the malevolent ecosystem that surrounds it, would be massive.
Illicit trade in tobacco is widespread, and research suggests that it is appealing to terrorists and organized criminal groups because the product is highly profitable, easy to transport, and subject to little enforcement. Also, the penalties, when applied, are usually less severe than those applicable to other illegal activities, like narcotics trafficking.
Between 10–12 percent of all cigarettes consumed are part of the global illicit tobacco trade, according to a 2006 report from the World Health Organization, also confirmed by a 2015 report from the U.S. Department of State. The value of the illicit tobacco trade is estimated to be greater than the illicit trade in oil, wildlife, timber, arts, cultural property, and blood diamonds combined.
That’s a sizeable revenue stream for bad guys and gals to fund their activities. Simply put, any serious effort to combat terrorism and transnational organized crime must tackle the illicit tobacco trade and cut off this critical funding source.
The industry has an important voice and role to play in delivering solutions. After all, we know our business better than anyone, and we have a vested interest to protect our supply chain, our shareholders’ interests, and our customers. PMI is working tirelessly to fight the illicit tobacco trade.
The industry cannot do this alone. A comprehensive solution calls for robust national and international enforcement strategies to strengthen the chances of success in getting steps ahead of the criminals.
Specific actions that could strengthen united efforts against the criminals include:
- Deterrent legislation, such as asset forfeiture laws and laws that provide for deterrent prison sentences for convicted illicit tobacco traders
- Well-funded law enforcement teams, with a mandate to take action against illicit tobacco as a key government priority
- Properly trained officers who are knowledgeable about the issue and with the right tools, such as container scanners, mobile scanners for trucks and sniffer dogs
- Funding intelligence efforts, enabling law enforcement to investigate the criminal networks
- Partnerships with the legitimate industry
- Clear ethics policies and fair remuneration for enforcement authorities to overcome corruption