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This Occasional Paper examines the exploitation of the internet and delivery services in relation to illicit trade in tobacco products in Europe. The findings are based on primary research in the form of semi-structured interviews with subject matter experts from law enforcement agencies, government, the private sector, NGOs and international organisations conducted in the UK, France and Germany between May and July 2018.
The research demonstrates that the growth of e-commerce and proliferation of postal and small parcel delivery services have had a significant impact on the trade in illicit tobacco products in many of the locations under consideration. Illicit tobacco products are now readily available to purchase with little effort and minimal risk – through online marketplaces, purpose-built hosted websites and social media platforms. In the past few years, as the number of social media users has increased dramatically, platforms such as Facebook appear to have become the primary medium through which illicit tobacco products are sold online, although online marketplace websites continue to be exploited. As illicit tobacco products are so readily available to purchase on these platforms, there does not appear to be a market for such products on the darknet.
Evidence suggests that there are two distinct types of offender selling illicit tobacco products online: opportunist individual sellers with no links to organised crime; and organised criminals with international contacts, access to a steady supply of illicit products, and sophisticated distribution networks. It appears that a small number of highly prolific sellers are responsible for a large proportion of all illicit sales. This has significant implications for investigation and enforcement, as it is likely that measures aimed at disrupting and apprehending the most prolific offenders will be more effective than measures targeting social media pages, groups and websites, which can reopen almost immediately following enforcement action.
A related but often distinct problem is the exploitation of postal and delivery services to transport illicit tobacco products into and within Europe. In recent years, the rapid growth of postal and parcel services has benefited criminal actors just as it has legitimate ones, although different postal and delivery operators face different levels of vulnerability. Given the sheer volume of small parcels now unloaded at customs facilities on a daily basis, customs officials are unable to inspect each consignment, instead relying on risk-led profiling strategies. Capitalising on this vulnerability, organised criminals have increasingly adopted a low-volume, high-frequency approach to smuggling all manner of illicit commodities (albeit alongside the ongoing use of high-volume transportation methods). In addition to reducing the risk of interception, low-volume, high-frequency methods also minimise the financial loss incurred in the event of a seizure, as a single consignment represents only a small proportion of illicit goods being transported by a given group.
Some criminal groups involved in illicit tobacco trade through postal and parcel systems are highly sophisticated and capable of coordinating long-running operations using multiple addresses, breaking up consignments across service providers. This agility makes it particularly difficult for customs and border agencies to enforce against this form of organised criminality.
The exploitation of the internet and delivery services to sell and transport illicit tobacco products in Europe are trends that are set to persist in the coming years. However, existing responses to the illicit tobacco trade are arguably not well suited to combat these new smuggling methods and could be strengthened in a number of ways.
First, internet companies, and particularly social media platform providers, could take measures to disrupt the sale of illicit tobacco products on their platforms. For instance, algorithmic content filters – in combination with human reviewers – are widely used to prevent the sharing of content that violates the platforms’ policies, such as pornography, hate speech and terrorist-related content. Such methods should also be used to prevent the sharing of material that violates the platforms’ commerce policies, including those related to tobacco products. Collaboration between platform providers and law enforcement agencies should be strengthened, to ensure the lawful provision of data to enable successful prosecution cases to be brought against the most prolific online offenders.
Second, in relation to abuse of postal and delivery services, it is crucial to strengthen two-way information-sharing mechanisms between postal and parcel operators and customs agencies. While cooperation has improved in recent years, there remains significant variation between countries and between delivery service providers, and further action is needed to ensure collaborative working practices between law enforcement agencies and delivery service providers as a group. Furthermore, existing risk assessment and profiling methods used by customs agencies are often not well suited to identifying the low-volume, high-frequency smuggling methods now favoured by some organised criminals. As such, there is a need to develop more sophisticated and intelligence-led approaches to risk assessment, for instance by using big data analytics to identify suspicious consignments and routing patterns.
More broadly, there is a need to strengthen information-sharing mechanisms between law enforcement agencies and other parts of the private sector. While cooperation has improved considerably in recent years, the private sector collects a large amount of useable information related to illicit trade, yet in many cases law enforcement agencies do not use this information. Improving information sharing with the private sector – including the tobacco industry – would provide law enforcement agencies across Europe with a richer intelligence picture of the individuals and groups involved in illicit trade activity.
At the same time, the decentralised business structure and low-volume, high-frequency methods favoured by many groups involved in the illicit tobacco trade render seizure-focused enforcement action increasingly ineffective. Law enforcement agencies can only intercept a small fraction of all goods being transported. Moreover, the consignments that are intercepted are often too low in value to have a meaningful deterrent impact on the smuggling group. For this reason, a greater focus on prevention is needed. It is important to devote more resources to consumer-focused demand-reduction campaigns, particularly through social media.
The trends examined in this paper suggest that a new generation of organised criminality is developing across Europe, one that will require new and innovative responses. Collaboration is crucial, between European governments, between law enforcement agencies, and between the public and private sectors.