HENRICO, Va. – On Monday police charged a 23-year-old Henrico resident with the possession with intention to distribute tax-paid cigarettes.
Police obtained and executed a search warrant for a home in the 3400 block of Kilburn Court.
They said that the evidence they found led to Thaer Mahasees being charged with possession of at least 40,000 tax-paid cigarettes with the intent to distribute.
Mahasees’ hearing for the felony charge will be in June.
Cigarette smuggling has become a lucrative business
Virginia currently has the second lowest cigarette tax in the country. The Virginia Crime Commission says that is attracting crime groups from as far away as New York because they can make bigger profits transporting cigarettes than they can with most illegal drugs.
In Nov. 2014, Fateh Al-Hayani, 37, of New York, was busted in Louisa with 7,940 packs of cigarettes. In late Sept. 2015 almost 2,000 cartons of cigarettes were seized in southern Virginia, at an estimated $238,000 value.
Packs of cigarette in New York can cost twice as much as packs of cigarettes in Virginia. Money made from the sale of black market cigarettes often funds organized crime, according to the Sentencing Commission.
Based on 2013 estimates from the Bureau of Alcohol, Tobacco, Firearms and Explosives a tractor trailer’s worth of cigarettes (that’s 800 cases, each holding 600 packs of cigarettes) of low-tax Virginia cigarettes can make $1,944,000 in high-tax New York.
In 2011, more than 60% of all cigarettes sold in New York were smuggled in from another state, according to the Mackinac Center for Public Policy, a free-market think tank. That’s up from about 36% in 2006.
It’s not just happening in New York. Mackinac says 15 states have smuggling rates that top 20%. Add in counterfeit cigarettes from overseas, and ATF estimates the lost government revenue at more than $5 billion a year.
“We’ve had people trading our undercover agents kilos of cocaine for cigarettes,” says Mike Campbell, a spokesman for ATF. “That’s how lucrative it is.”
While Virginia-New York gets most of the attention, Campbell says trafficking rings run cigarettes from many of the low-cost states to most of the high ones. Virginia to California and North Carolina to Michigan are other popular routes.