up-to-uah-30-million-profit-per-month-a-powerful-network-of-illegal-cigarette-production-exposed-in-ukraine

Up to UAH 30 million profit per month - a powerful network of illegal cigarette production exposed in Ukraine

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In Kyiv and Mykolaiv regions, law enforcement officers uncovered a powerful network of underground tobacco factories producing cigarettes. The organizers of the illegal business received up to UAH 30 million in profit per month. This was reported by the National Police of Ukraine, UNN writes.

Details

According to the investigation, the "business" was organized by two residents of Odesa and Mykolaiv in 2021 and involved at least 10 participants as partners. Each of them was responsible for his or her own area of activity: control over production and storage warehouses, recruitment, sales market, communication with customers, administration of websites and telegram channels, logistics of counterfeit supplies, accounting, and conspiracy measures.

The network of clandestine tobacco factories was located in industrial zones in Kyiv and Mykolaiv regions. All of them were equipped with full-cycle production lines with a capacity of up to 80 thousand packs per day. The staff, residents of different regions of Ukraine, worked in shifts. The members of the criminal organization provided them with the necessary living conditions, brought them to the clandestine factories, and took away their cell phones before their shifts. The clandestine factories were equipped with video surveillance cameras and autonomous power supplies

- the National Police reported.

The finished products were then delivered to warehouses in Odesa, Mykolaiv, Kyiv, Cherkasy and Ivano-Frankivsk regions, from which they were sold in bulk to individuals and legal entities. To make payments, the members of the criminal organization used bank accounts opened in the names of front companies.

The National Police clarified that a significant portion of the cigarettes were sold under the guise of trademarks owned by international manufacturing companies, including those from the United States, the United Kingdom, and the Netherlands. One of the companies alone suffered intellectual property damage of more than two million hryvnias.

"The tobacco 'business' brought its organizers up to 30 million hryvnias in profit per month, and they paid no taxes. As a result, the budget was losing about six million hryvnias a month. Part of the criminal money was invested in the development of the illegal business, and the rest was spent on the purchase of real estate, cars and their comfortable life," the National Police added.

Criminal proceedings were opened over the creation of a criminal organization, illegal manufacture of excisable goods, illegal use of a trademark, and money laundering.

12 suspects were served with notices of suspicion, two of them were detained. During the searches, products and production lines worth more than one million dollars were seized.

Optional

Director of the Kyiv Scientific Research Institute of Forensic Expertise Oleksandr Ruvin in an exclusive interview with UNN saidthat without practical use, new tools to combat the illegal tobacco market will not be effective.

"At one time, we had an idea to create a thematic register of manufacturers. The State Tax Service provided us with a list of companies licensed to sell tobacco products - more than 50 representatives. The companies were supposed to provide us with reference product samples. We received some of the information, but this work is not being used as effectively as it could be. In addition, the experts have all the technical capabilities to conduct direct monitoring visits to production facilities. The steps are simple: the arrival of experts, production of several packs in their presence, prompt analysis of all characteristics on site (tobacco, packaging, filter elements, other components and their signs), and a conclusion here and now. Resolutions on the appointment of expert examinations to investigate the facts of illegal tobacco production are now being issued in the amount of dozens a day, and the state must have clarity on this issue," Ruvin said.

Zakhar Podkidyshev

Economy

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