Imperial Tobacco Accused of Smuggling

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Imperial Tobacco Accused of Smuggling

12/15/2004
MONTREAL -- A warrant sought by the Royal Canadian Mounted Police (RCMP) for a raid on the offices of Imperial Tobacco alleges the company took part in a criminal conspiracy to smuggle its own product back into Canada while withholding more than $600 million in taxes from the federal government, according to the Montreal Gazette.

An affidavit has been made public that details the reasons why the RCMP spent three days in November searching the offices of Montreal's Imperial Tobacco Limited.

The affidavit, prepared by the RCMP to obtain their warrant, alleges billions of cigarettes were sold by Imperial to American distributors with the goal of reselling them to clients on the St. Regis and Akwesasne reserve and that they be reintroduced to Canadian customers through contraband networks.

The affidavit alleges that Imperial and other "co-conspirators" defrauded Ottawa out of $607 million in taxes.

That is based on an estimated that the company allegedly sold 50 million cartons of cigarettes between 1991 and 1993 through a contraband network. The taxes on a carton of cigarettes at the time were $12.14 per carton.