Study finds rising illicit cigarette trade on social media

The paper calls for new solutions to address this rising phenomenon and adjust to smugglers’ “innovative” methods. [Shutterstock]

Social media and delivery services have become new outlets for organised crime activities when it comes to illicit cigarette trade, according to a new study that has raised eyebrows among EU policymakers.

The study published on Wednesday (17 October) was conducted by the Royal United Services Institute (RUSI), the world’s oldest independent think tank on international defence and security, and focused on the UK, Germany and France.

“Criminals dealing in illicit cigarettes have benefited substantially from the growth of e-commerce and proliferation of postal and small parcel delivery services […] the exploitation of the internet and delivery services to sell and transport illicit tobacco products in Europe are trends that are set to persist in the coming years,” the study warned.

Another report published last summer found that in terms of volume, counterfeit and contraband cigarettes in Europe had dropped from 48.3 billion to 44.7 billion in 2017, still depriving governments of as much as €10 billion in lost tax revenues.

France remained the largest illicit cigarettes market, accounting for 7.61 billion, though it registered a large 15% drop in the number of counterfeit and contraband cigarettes. However, initial surveys results in 2018 have indicated a reversal of the downward 2017 trend.

The RUSI study emphasised that in countries such as the UK and France, social media played a major role in selling illicit tobacco products online.

“At the same time, many organised criminals have capitalised on the growth of e-commerce to send illicit consignments through postal channels, hidden in plain sight among a sea of other packages. This is a related but often distinct problem – not all illicit tobacco products bought online are delivered by post, with many instead delivered in person,” the study stressed.

“This agility makes it particularly difficult for customs and border agencies to enforce against this form of organised criminality,” it added.

Adjust to smugglers’ ‘innovation’

The paper calls for new solutions to address this rising phenomenon and adjust to “innovative” methods used by smugglers.

“First, internet companies, and particularly social media platform providers, should take strengthened measures in partnership with law enforcement to disrupt the sale of illicit tobacco products on their platforms.”

The study also suggested that “enforcement action should be strengthened against online sellers, with law enforcement, social media platform providers and online marketplaces ensuring that those illegally selling illicit tobacco products on their platforms face – and are seen to face – consequences, including disciplinary action.”

“More broadly, there is a need to strengthen information-sharing mechanisms between law enforcement agencies and other parts of the private sector. While cooperation has improved considerably in recent years, the private sector collects a large amount of useable information related to illicit trade, yet in many cases, law enforcement agencies do not make use of this information.”

The EU tobacco product directive

A European Commission spokesperson explained to that under the Tobacco Products Directive (TPD), member states are allowed to prohibit cross-border distance sales of tobacco products and they shall cooperate to prevent such sales.

“The Directive requires retail outlets that engage in cross-border distance sales to register with the national competent authorities and to fulfil a set of minimum requirements, including the operation of an age verification system.”

In addition, the spokesperson explained that there was also the Tobacco Advertising Directive, which bans tobacco advertising in information society services across the EU and that “member states are responsible for enforcement.”

“The Directive does not cover the sale of tobacco products but one of the key challenges of implementing the tobacco advertising ban on the internet is how to recognise the covert/indirect forms of advertising that can indeed occur around the internet sales of tobacco products as they often involve an element of promotion,” the spokesperson concluded.

"RUSI’s findings confirm a direct link between illegal tobacco trade and terrorism financing. Illegal tobacco trade is not only damaging to governments’ revenues and consumers’ health but also to national security. Combatting radicalisation in our society is vital but it won’t be enough if we don’t tackle terrorist financing. Social media platforms have been hosting illegal terror content on their platforms for years. Now it turns out that they are not just a medium that helps to spread harmful ideologies but indirectly finances the deadly terror attacks as well," commented David Ibsen, Executive Director of Counter Extremism Project (CEP).

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