December 26, 2017
Albany, NY

Governor Cuomo Announces $6.6 Million in Illegal Tobacco Removed from New York State Streets in 2017

Governor Cuomo Announces $6.6 Million in Illegal Tobacco Removed from New York State Streets in 2017

Cigarette Strike Force Seizes More than 1.5 Million Illegal Cigars -- 476% Increase from Last Year

Arrests More Than 85 Accused Tobacco Smugglers Who Face More Than $7 Million in Fines

Governor Andrew M. Cuomo today announced New York State's Cigarette Strike Force seized $6.6 million worth of contraband tobacco in 2017, a $1 million increase compared with last year's total. Untaxed cigars made up the bulk of these confiscations. Investigators seized more than 1.5 million illegal cigars this year compared with 260,000 last year, a 476 percent increase. More than 47,000 cartons of untaxed cigarettes have been seized along with 134,000 counterfeit tax stamps and nearly $445,000 in cash.

"This illicit activity not only hurts law abiding businesses, but it also places undue burdens on taxpayers due to the loss of state revenue for vital services," Governor Cuomo said. "This administration will continue to do everything in its power to crack down on these criminals and help ensure a fair and level playing field for all."

This year, Cigarette Strike Force investigators also arrested 85 accused cigarette and tobacco smugglers who face more than $7 million in fines.

In 2014, Governor Andrew M. Cuomo directed the Tax Department to create a Cigarette Strike Force to stem illegal tobacco trafficking and sales. Since its inception, each year the Strike Force has increased the number of inspections and seizures. In October, the Tax Department announced that it joined forces with the Gaming Commission, which oversees lottery ticket sales, and the State Liquor Authority in an initiative to further reduce sales of contraband cigarettes.

Under the policy, a tobacco-licensed retailer found to be in possession of untaxed cigars or cigarettes will face immediate enforcement action, leading to the possible suspension or revocation of licenses to sell tobacco, alcohol, and lottery tickets. The agencies are targeting the largest revenue drivers for certain retailers, thus further deterring illegal cigarette and tobacco sales.

There are approximately 21,000 licensed retailers selling cigarettes and other tobacco products in New York State. An overwhelming number of them also sell lottery tickets and liquor.

Recent Busts

    • In August, Strike Force investigators seized more than 2,700 cartons of untaxed cigarettes in Brooklyn. The illicit cigarettes were found stashed in a car and a garage.
    • In July on Staten Island, a man was accused of making deliveries of untaxed cigaretteswith his personal vehicle. Investigators seized more than 1,000 cartons of illegal cigarettes.
    • Strike Force investigators assisted the Bronx DA in breaking up a massive cigarette smuggling ring in June. It resulted in 21 indictments, and the seizure of three homes,along with nearly 10,000 cartons of untaxed cigarettes.

Knowing the tactics used by illegal cigarette sellers allows investigators to uncover contraband that isn't always in plain sight. Oftentimes, illicit tobacco products are found buried under the floorboards, stashed behind a trap door, or tucked inside the ceiling tiles. Smugglers also keep contraband tobacco products hidden in storage lockers and garages.

Acting Commissioner of Taxation and Finance Nonie Manion said, "The collaboration among our criminal investigators and law enforcement partners, and the added deterrence from other state agencies such as the State Liquor Authority and the Gaming Commission, have been crucial to our success at removing contraband tobacco from our streets. Governor Cuomo's foresight to establish the Strike Force continues to benefit all New Yorkers."

New York State Liquor Authority Chairman Vincent Bradley said, "The SLA remains committed to partnering with Tax and Finance and the Gaming Commission to eliminate illegal cigarette trafficking. Retailers selling these smuggled products are defrauding New York taxpayers, engaging in unfair competition, and putting their license to sell beer in jeopardy."

Acting Executive Director of the New York State Gaming Commission Ron Ochrym said, "It takes a multipronged effort to stop the proliferation of untaxed cigarettes. We are proud to join with our partners at the Department of Tax and Finance, Department of Health, and the State Liquor Authority to send a message that there are real consequences for retailers that sell untaxed cigarettes."

State Department of Health Commissioner Dr. Howard Zucker said, "Tobacco use is the number one preventable cause of death and disease in New York State. The state cigarette excise tax is an effective strategy for reducing youth access to tobacco and motivating adults to quit. I applaud Governor Cuomo for creating the Cigarette Strike Force to help crack down on cigarette smuggling, which undermines public health efforts to prevent tobacco use in New York State."

Maintaining the high cost of tobacco products is considered a "best practice" by the Centers for Disease Control and Prevention in reducing tobacco use, particularly when combined with smoke-free air laws and robust media campaigns. It's no coincidence that New York State has the lowest youth smoking rate in the nation, 4.3 percent, and the lowest adult smoking rate in the state's history, 14.2 percent. These achievements are the direct result of the state's aggressive and comprehensive tobacco-control efforts.

All cigarette packs sold in New York must have an authorized New York State cigarette tax stamp affixed to the bottom, verifying that the excise taxes have been paid. Defendants found guilty of violating cigarette and tobacco tax laws could face stiff jail or prison sentences and possible penalties of up to $600 per carton of illegal cigarettes seized. The Strike Force helps deter illegal trafficking and ensure that cigarettes are sold legally and taxed accordingly.

Report Fraud

You can anonymously report tax evasion and fraud online at the Tax Department's website or by calling 518-457-0578. The information is kept confidential. The Tax Department will promptly review each complaint and take corrective action when appropriate.


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