With the support of Europol, a massive illegal cigarette factory near Budapest has been raided and shut down by the Hungarian National Tax and Customs Administration. Nine Bulgarian members of the organised crime group running the factory were arrested, and authorities seized the complete cigarette manufacturing machinery, 22 tonnes of tobacco and 2.3 million cigarettes. According to authorities, the tobacco seized was enough to produce 1.5 million packets of cigarettes.
Illegal tobacco factories provide organised crime groups with a huge source of income, which often goes towards funding other areas of serious organised crime and terrorism. Excise fraud is therefore currently an EU law enforcement priority. Strategic and operational plans have been developed under the European Multidisciplinary Platform Against Crime Threats (EMPACT) Excise Fraud Project. A total of 23 countries and five international agencies are working together to translate these plans into intelligence sharing, operations, financial investigations, and training on tobacco, alcohol & oils fraud.
The action on 2 February was the result of intensive cooperation between various law enforcement agencies including customs, police and security services from six different EU Member States, supported by Europol. This support included intelligence sharing and development, crime analysis, and coordinated international collaboration and interventions. Europol also deployed a mobile office deployment to the operational control unit in Budapest. This allowed information gathered during the raid to be cross-matched against Europol's databases. Real-time feedback was then provided to officers on the ground during the operation.
KPMG's Project Sun report states that the revenue loss from counterfeit and contraband cigarettes to EU governments in 2013 was approximately EUR 10.9 billion. Excise fraud affects us all because the lost government revenue could have been spent on vital public services such as schools, hospitals, and law enforcement.