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    Counterfeit Cigarettes a Growing Commodity

    Investigations into smuggling increased approximately 300 percent in past three years.

    PASADENA, Calif. -- Federal agents are seeing a jump in cigarette-smuggling cases and are confiscating more counterfeit cigarettes, reported the Pasadena Star News.

    The International Customs Enforcement (ICE) agency and the Bureau of Alcohol, Tobacco, Firearms and Explosives have been doing more cigarette-smuggling investigations in recent years, and described them as larger, more complex and longer-term than previous probes, according to a May report by the U.S. General Accounting Office.

    But the report pointed out that the extent of cigarette smuggling in the country is unknown, given the clandestine nature of the crime. "It is a substantial problem," said Steven Lovett, an ICE group supervisor.

    The number of investigations by ICE agents into tobacco smuggling increased by about 300 percent in the past three years, said Kevin Kozak, associate special agent in charge of ICE's Los Angeles office. Federal officials also have seen a jump in the number of counterfeit cigarettes confiscated.

    Most counterfeit cigarettes seized in the country were at the Los Angeles and Long Beach ports, which when combined, make up the third-largest port in the United States, according to the report. In 2001, about 30 percent of seizures nationwide happened at the two ports. That figure rose to 46 percent in 2003. Federal officials said the increase may be due to better intelligence and inspections.

    Smugglers don't pay taxes, resulting in a loss of federal and state revenues. Gangs and organized crime also are attracted to counterfeit-cigarette trafficking, since the penalties are less severe than drug smuggling, federal officials said.

    Counterfeit cigarettes are made overseas. The majority of those ending up in Los Angeles County come from China, Lovett said, due in part to proximity and in part to the amount of cargo coming to the local ports from China.

    Trafficking in counterfeit cigarettes also affects cigarette companies. Dana Bolden, spokesman for Philip Morris USA, said the cost is significant but couldn't be more specific than that. "It's too difficult (to quantify) because it's an illegal activity," Bolden said. "It's a growing problem. We're trying to address the problem by working with law enforcement, through legislation and litigation. This is a very serious issue for us."

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