Police raids strike at epicenter of Canada’s contraband cigarette market

July 17, 2020
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Last month, the Ontario Provincial Police (OPP) Organized Crime Enforcement Bureau pulled off a major bust, following a two-year investigation. Investigators managed to shut down an illegal manufacturing network distributing contraband tobacco and illicit drugs across Canada. Through collaborative efforts, multiple law enforcement agencies and Special Forces seized illegal tobacco, cannabis products, and other narcotics.

Throughout the course of the operation, code-named “Project Cairnes,” investigators acted on 13 search warrants across Canada—in Ontario, Montreal, Richmond, and Vancouver. They found that products were being trafficked across Canada, including to Quebec and British Columbia, where they were sold openly on the streets.

The investigation came to a head on June 1, 2020, with the successful raid of a manufacturing facility located in Six Nations Territory, southwestern Ontario. Ten people were arrested, and the seized goods included:

- 11.5 million contraband cigarettes
- 1,714 pounds of cannabis 
- A cocaine press
- 1.14 kilograms of cocaine
- 10.2 kilograms of piperidone 
- 1.3 kilograms of fentanyl
- $236,750 in cash
- Three handguns
- Seven vehicles

Collectively, the street value of the products equated to more than $5 million. The contraband cigarettes alone were estimated to have incurred a tax loss of more than $3.3 million. This is based on the contraband cigarettes that were seized throughout the investigation. Notably, this tax hit is only a small proportion of the $750 million Ontario loses in provincial excise tax annually to contraband cigarettes, according to an Ernst and Young (EY) report in 2018.

Southwestern Ontario’s entrenched illegal cigarette problem

Ron Bell, the law enforcement adviser for the National Coalition against Contraband Tobacco (NCACT), has described southwestern Ontario as the “epicenter of contraband tobacco in Canada.” The Royal Canadian Mounted Police (RCMP) have estimated that one in three cigarettes sold in the region are illicit. Criminal groups are believed to use over 50 illegal manufacturing plants, the majority of which are located in the Ontario area.

The work of Project Cairnes represents a huge development in the fight against contraband cigarettes in southwestern Ontario. However, the scale of the issue is vast, with the RCMP finding that over 175 organized crime groups in Ontario are involved in the illicit trade. Law enforcement agencies cannot afford to lose momentum after this progress.

Millions of illegal cigarettes are estimated to be manufactured on a daily basis in Ontario. Lawmakers have struggled to tackle those who have “acted with near impunity for decades, selling contraband tobacco and making millions of dollars off its illicit trade.” Fake cigarettes are transported to all parts of the country by criminal groups. But tobacco is not the only product these criminals trade—criminal networks are also involved in the sale and distribution of illegal drugs and human trafficking.

Throughout the investigation, 16 people were arrested—many of whom were associated with more serious criminal groups. Authorities uncovered drug trafficking networks, in addition to the production and trafficking of contraband tobacco. These networks were responsible for weekly shipments of illicit cannabis from British Columbia to Ontario. Seven of those arrested were also charged with conspiracy to commit murder. The investigation clearly demonstrates that illegal tobacco continues to be a major driver for organized crime.

Collaboration between law enforcement agencies

Project Cairnes brought together multiple law enforcement agencies. Whilst the OPP’s Organized Crime Enforcement Bureau led the investigation, it was supported by various other agencies, including the CTET and Provincial Asset Forfeiture Unit, the Royal Canadian Mounted Police, Combined Forces Special Enforcement Unit, Ministry of Finance in Ontario and British Columbia, and FINTRAC.

The police involved in Project Cairnes were not only successful in taking down contraband tobacco. They managed to uncover these drug trafficking networks that were responsible for large shipments of illicit cannabis. It is evident from the investigation that the threat of contraband cigarettes to southwestern Ontario stretches way beyond the tobacco industry. The trade helps to fuel all areas of organized crime in the region.

The police were widely commended in Canada for their hard work throughout Project Cairnes. The collaborative approach taken is no doubt part of the reason the investigation was effective. Through effective cooperation, investigators were able to reduce the threat to the local and national community by taking down a significant part of Ontario’s substantial contraband cigarette network.

STOP ILLEGAL

Written by STOP: ILLEGAL

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