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Cigarette Smuggling Emergency
in Michigan

STATE OF MICHIGAN

OFFICE OF THE GOVERNOR
LANSING

JOHN ENGLER
GOVERNOR

 

          Pursuant to Section 48(1) of Act No. 306 of the Public

Acts of 1969, as amended, I hereby concur in the finding of the

Michigan Department of Treasury, that [cigarette smuggling]

circumstances have created an emergency and the public

interest requires the emergency promulgation of the attached

rules pertaining to the "Tobacco Products Tax."


Dated at Lansing, Michigan this 22nd day
of August 1997.
/s/John Engler
John Engler
Governor



The above 22 Aug 1997 finding by Michigan Gov. Engler was issued due to what was deemed a cigarette smuggling emergency to evade Michigan's cigarette tax.

The problem had been worsening for some time, October 1995 - August 1997.

"Cigarette smoking in Michigan is so rampant, says Dearborn Police Chief Ron Deziel, that his narcotics investigators spend more time tracking down illegal cigarettes than illegal [post-gateway] drugs.

"'We literally cannot keep up with the constant flow of tips on cigarette smuggling,' Deziel said, 'let alone initiation of meaningful investigations targeted at organized crime smuggling.' . . .

"The smuggling problem . . . extends far beyond Dearborn.

"In fact, Michigan is the biggest market in the country for contraband cigarettes, said Larry Ford, supervisor in the federal Bureau of Tobacco, Alcohol and Firearms. Ford said three additional BATF field offices outside Michigan have been called in to investigate smuggling."—Matthew G. Davis, "Cigarette smuggling getting worse, cop says," Detroit Free Press, p 10A (28 October 1995).


Better solution: Enforce MCL § 750.27, MSA § 28.216, arrest the sellers, they're blatant, obvious, in the store, behind the counter!! an easier approach than ignoring the sellers while focusing only on trying to hunt down the allegedly mysterious suppliers!

In addition, Michigan has a safe-cigarettes law, MCL § 750.27, MSA § 28.216. You may have heard of laws seeking "fire-safe" cigarettes, i.e., ingredients that do not cause house fires. Michigan's law provides for cigarettes to be ingredients-safe across-the-board, i.e., ingredients must not cause adverse health effects.

This cigarette smuggling emergency memo was issued 22 August 1997.
  • To see Engler's veto of a 1992 so-called "smokers rights employment bill," click here.

  • To see his Director of Community Health (DCH) 9 July 1997 analysis of the Michigan cigarette selling ban, click here.

  • To see DCH's subsequent 11 Sep 1997 re-verification of the law, click here.

  • To see Governor John Engler's subsequent 11 Jan 1999 message overview of the cigarette hazard to Michigan, click here.

  • To see the DCH's 17 April 2003 letter on second-hand smoke, click here.

TCPG has prepared an analysis of the Michigan law, MCL § 750.27, MSA § 28.216, in essence, a smokers'/nonsmokers' rights law as it protects both groups—an analysis with examples of

See also pertinent legal terms and their definitions.

Contraband is "any property which is unlawful to produce." Black's Law Dictionary, 6th ed (St. Paul: West Pub, 1990), page 322. Bringing cigarettes into Michigan is "smuggling." "'Smuggle' has well-understood meaning . . . signifying bringing . . . goods, wares, and merchandise . . . importation . . . whereof is prohibited. Williamson v U.S., C.A. Cal., 310 F2d 192, 195 [CA 9, 1962]; See 18 USC §§ 545, 546." Black's Law Dictionary, supra, page 1389.

See also Michigan's advertising ban law, MCL § 750.38, MSA § 28.227.

Souza Cruz has a Market Report on Philip Morris Smuggling (8 September 1993)

See also Detroit Free Press (Friday 18 Feb 2005), pp 1 and 3.

Tracey Madigan, "Theory on contraband tobacco unveiled in Montreal," Online News CBC Montreal (16 Sep 2002), says, "One-quarter of all the tobacco distributed around the world is illegal contraband, according to an international researcher."

A 1 February 2002 European Union court document links smuggling and terrorism.

A 31 January 2000 exposé of cigarette smuggling is entitled, "Major Tobacco Multinational Implicated In Cigarette Smuggling, Tax Evasion, Documents Show," by Maud S. Beelman, Maria Teresa Ronderos, and Erik J. Schelzig, International Consortium of Investigative Journalists, the Center for Public Integrity (ICIJ-CPI).

A 6 March 2001 ICIJ-CPI exposé of cigarette smuggling, "Tobacco Companies Linked to Criminal Organizations in Lucrative Cigarette Smuggling,"

"indicates that tobacco smuggling is increasingly dominated—often with the knowledge and consent of the tobacco companies—by a handful of criminal organizations that in some cases have links to organized crime. The report is based on a review of thousands of pages of corporate and government documents and dozens of interviews with law enforcement officials, smugglers and other sources worldwide."

A 22 Feb 2002 ICIJ-CPI exposé of cigarette smuggling in terrorism-context is entitled, "U.S. Tobacco Companies Accused of Terrorist Ties And Iraqi Sanctions-Busting."

The cigarette smuggling problem is clearly not only a Michigan problem. It has worldwide ramifications. For example, see the paper entitled, The Nicotine Racket: Trafficking in Untaxed Cigarettes. A Case Study of Organized Crime in Germany. That was a guest lecture given at the Institute for Criminology of the Oslo University (Norway) in May 1999 by Klaus von Lampe.

For a paper on cigarette smuggling in Italy, "Racketeer Cases Shed Light on Cigarette Smuggling in Italy," New York Times, by Raymond Bonner, 2 Sep 1997, click here.

In June 2000, it became international news about British government concern about cigarette smuggling. See Duncan Campbell, “Investigative Report: U.K. Considering Formal Investigation Into Cigarette Smuggling,” Center for Public Integrity  (June 15, 2000).

In October 2002, Inigo Gilmore in Jerusalem and David Wastell, Diplomatic Correspondent, reported “US tobacco companies face claims of smuggling to Iraq,” in the Sunday Telegraph (London) 13 October 2002.

“Immediately after the Persian Gulf War ended in 1991, billions of Winstons and other American-brand cigarettes began turning up inside Iraq. Even now, the flow continues.”—Steve Stecklow and Alix M. Freedman, “Bound for Baghad: Despite Restraints, Iraq Gets Winstons; Who's to Blame?: RJR Unit, Japan Tobacco Face Scrutiny Over Distribution; Saddam's Son Takes a Cut: Seven Planeloads to Jordan,” CCXL Wall Street Journal Midwest Ed. (#86) A1, A14 (Wed., 30 Oct 2002).

For information on cigarette smuggling in California, see Benjamin Alamar Ph.D., Leila Mahmoud J.D., and Stanton A. Glantz Ph.D., "Cigarette Smuggling in California: Fact and Fiction" (30 July 2003).

"Cigarette trafficking rivals drug trafficking as the method of choice for funding terrorist groups such as Hamas, Hezbollah, and groups connected to North Korea, according to federal officials," says Stephanie Hoops, "Prop. 86 debate raises issue of cigarette trafficking by terrorists," Ventura County Star, 13 August 2006).

"Terrorists may get money from regional, cheap cigarette smuggling ring: Ray Kelly," say Greg B. Smith and Oren Yaniv, in the New York Daily News (Thursday, 16 May 2013) ("Authorities Thursday scrambled to find millions of dollars in profits a smuggling ring that sold cheap cigarettes to bodegas across New York may have used to fund terrorism in the Middle East.")

"Al Qaeda rocket blows lid on IRA cigarette cargo" (The Independent, 22 September 2013) ("Inside was €4m-worth of illegal cigarettes, which were bought for as little as 20c a packet in Vietnam, destined for the Irish market.")

If you read accusations of smuggling by tobacco companies, think of the record of how they have behaved in the past. Tobacco companies have a century old pattern of ruthless business practices, as shown by the history of litigation on the subject.

You get another glimpse of how tobacco companies behave, when you understand
  • the routine of international bribery
  • early smokers' rights cases, identifying the type of things put in tobacco.

    And do not overlook the changing of the cigarette formula to add coumarin, otherwise used for rat poison in, e.g., Warfarin.

    Also note pertinent criminal law precedents for intentionally causing deaths. You can likely conclude that smuggling would not be out of character.

    U.S. Smuggling Cases With Text Available Online
    U.S. v Baker and Hale, 63 F3d 1478 (CA 9, D Montana, 6 Oct 1995) (contraband cigarettes, smuggling, racketeering (RICO) and money laundering)

    U.S. v Gord, 77 F3d 1192 (CA 9, WD Montana, 1 March 1996) (smoke shop cigarette smuggling case and money laundering)

    US v Boots, et al, Case No. 94-1813 (CA 1, Maine, 29 March 1996) (cigarette smuggling into Canada, with bribery and tax evasion)

    USA v Trapilo, Case No. 97-1011 (CA 2, ND NY, 5 Dec 1997) (case involving cigarette smuggling to evade Canadian tax)

    Other Sites You May Find Useful
    Tobacco Company Business Practices Cases
    Smokers' Rights Cases Against Tobacco Companies
    Tobacco Company Tax Appeal Cases
    Tax Evasion As Fraud Constituting Moral Turpitude

    Click here to visit the Center for Public Integrity.
    The Center for Public Integrity is the source of
    some of the above smuggling exposé article links.




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    Copyright © 1999, 2001 Leroy J. Pletten