International Cooperation in the Fight Against Organised Crime

Richard Trimble

Head of National Freight Intelligence Unit

Revenue Commissioners

Ireland

Central Intelligence & Drugs Enforcement Branch

National Freight Intelligence Unit

Suspicious Transaction

Reports

Customs Drugs Law

Enforcement

National Source

ManagementUnit

MTICCarousel Fraud

Customs National

Intelligence Database

Central Intelligence & Drugs Enforcement Branch

National Freight Intelligence Unit

Suspicious Transaction

Reports

Customs Drugs Law

Enforcement

National Source

ManagementUnit

MTICCarousel Fraud

Customs National

Intelligence Database

2002 Project Targeting consignees in Northern

Ireland importing via Southern ports Republic

of Ireland

Northern Ireland

United Kingdom

France

Dublin Port

Felixstowe

Belfast

Warren Point

Rosslare

WaterfordCork

Foynes

Drogheda

National Freight Intelligence Unit

• 2 Suspect Containers departed Miami, USA on 21st February 2002

• Various Risk Indicators

• Consignments failed pre-arrival intelligence checks

• ETA Dublin Port 17th March 2002 (National Holiday)

The 2 Suspect Containers Transhipped Felixstowe (UK)

Profiled for Interception in Dublin Port

Found to contain 15.7 million ‘Dorchester’ cigarettes

Follow-up Investigation regarding the Miami/Dublin/Northern Ireland route

• Identified 7 previous containers• Identified 4 subsequent containers

(24.3 million ‘SuperKing’ seized in Dublin Port)

Ireland forwarded a request to OLAF under Council Regulation 515/97

Austin Rowan

Head of Unit Customs II (Task Group Cigarettes)

Directorate of Investigations & Operations II

European Anti-Fraud Office (OLAF)

European Commission

Unit B3: Cigarette smuggling

The “MIAMI” case

Countries involved: Ireland, USA, Belgium, France, Germany, Spain, Portugal, Cyprus, Uruguay, Chile, Panama, the Netherlands, United Kingdom, Singapore, UAE & Canada

Background

• 6 containers of cigarettes seized by Irish Customs in 2002:– False Bills of Lading– Fraudulent invoices presented to Irish Customs.

• Request by Irish Authorities to OLAF to coordinate international investigations.

• Investigations revealed that cigarettes were also smuggled into Germany, France, Spain and Portugal.

Routing

• From the cigarette manufacturer– to Cyprus to Uruguay to Panama to Miami.– to Cyprus to the Netherlands to Miami.

• From Miami to EU misdescribed as other products.

OLAF Investigations and Support

• Coordination meetings in Brussels with all countries concerned.

• OLAF missions to Ireland, United Kingdom, France, Spain, USA, Cyprus, Uruguay, the Netherlands.

• MA Request to Canada – excellent cooperation.

• OLAF and US ICE Attaché mission to US Department of Justice in August 2005 – Washington DC.

• Criminal case opened in USA

• Analysis of evidence.

• Support for US, German, Spanish and Irish criminal action.

The MIAMI investigation led to other seizures and arrests:

• Intelligence from US ICE led to 2 controlled deliveries in the UK in October 2006. Origin of the cigarettes was China.

• 10,800,000 pieces seized. Prevented losses approx. €3,000,000.

• 10 persons arrested.

OLAF Investigations and Support

Results of intelligence gathered during the investigation:

• In March 2007 Irish customs seized 7,259,600 British Heritage cigarettes

• Produced in Gran Canaria shipped to Panama, then to Miami, the Netherlands and Dublin.

• Declared in Ireland as wood flooring (see US ICE presentation)

• Approx. €2,500,000 losses prevented.

OLAF Investigations and Support

• In March 2008 HMRC seized 6,000,000 GOLDEN EAGLE cigarettes

• Shipped from Panama to Miami then to Felixtowe.• Approx. €2,500,000 losses prevented.

OLAF Investigations and Support

Results to date

• Opening of criminal case in the USA.• Opening of a criminal case in Spain.• Opening of a criminal case in Germany. • The identification of:

Illegal cigarette consignments to different European Union countries.

Suspect cigarette movements via North and South America.

Suspect money transfers to different countries in the world.

Illegal consignments of cigarettes that were seized in Ireland, UK and Belgium.

Principal arrested and charged in Miami. • Total of duties identified as evaded: approximately

€100,000,000.

Deborah Morrisey

Supervisory Special Agent

U.S. Immigration and Customs Enforcement (ICE)

United States of America

Operation TOBACCO ROAD

• Information initially received from the ICE Attaché's Office Brussels, Belgium and assigned to Miami.

• Cigarettes are legitimately imported into the United States from various ports, including UK and Panama

• Cigarettes smuggled into the United States from China

• Organization then smuggles these cigarettes from the United States into various European Countries

• Proceeds are then diverted back to the respective participants and their criminal organizations.

• ICE SAC Miami works with numerous EU Countries in an attempt to dismantle the organization.

Violations of United States Code

• 18 USC 554: Smuggling of Goods from the United States• 18 USC 1341: Mail Fraud• 18 USC 1343: Wire Fraud• 18 USC 2: Conspiracy• 18 USC 1956: Money Laundering• 18 USC 371: Conspiracy

Instructions are sent to repack shipment with

cover load masking

cigarettes

Documents are prepared reflecting

contents of shipment being cover load.

Cover load is purchased and

moved to warehouse.

Enter Bonded Warehouse as

Cigarettes

Container of Cigarettes are shipped to Miami from foreign

Real manifest is sent to recipient reflecting what is

actually in container

The Scheme Duty is paid on value

of cover load. Delivery made.

Shipment Sent to destination port.

Warehouse Receipts

Loading Instructions

Bill of Lading

Cynthia Stone

Chief of Organized Crime Section

U.S. Attorney’s Office, Southern District of Florida

U.S. Department of Justice

United States of America

The Indictment

3. Goods, being shipped worldwide, are shipped in commerce pursuant to a bill of

lading. A bill of lading is a document issued by a carrier, acknowledging that specified goods have

been received on board as cargo for transportation to a named place for delivery to the consignee.

A consignee is an identified receiver. A bill of lading is a negotiable instrument. It is a document

of title that enables the bearer of the original bill of lading to receive the goods from the carrier upon

presentation of the bill of lading.

4. Customs duties, excise duties, and value-added tax were levied and collected based

upon the type of goods and the value of those goods that were imported and declared on the customs

forms that are filed at entry into a country.

COUNT 1(CONSPIRACY - 18 U.S.C. § 1349)

The Judgment

IMPRISONMENT: 24 MONTHS

RESTITUTION: $1.5 MILLION

CUTLER BAY RESIDENT PLEADS GUILTY TO SMUGGLINGAdmits to Smuggling More than 27 Million Cigarettes out of the United States

Jeffrey H. Sloman, Acting United States Attorney for the Southern District of Florida, and Anthony V. Mangione, Special Agent in Charge, U.S. Immigration and Customs Enforcement (ICE), Office of Investigations, Miami Field Office, announce that Roman Vidal has pleaded guilty to conspiring to commit wire and mail fraud in connection with the smuggling of cigarettes out of the United States and into various European Union countries in order to

avoid paying more than $6.5 million in customs and tax duties. Sentencing has been set for November 10, 2009 before the Honorable Alan S. Gold.

According to court documents and statements made in court today, [X] conspired with individuals located in Miami and in Spain, Great Britain, Ireland and Germany, to smuggle cigarettes from the Port of Miami into Aachen,

Germany, Dublin, Ireland, and Felixstowe, Great Britain. To execute the scheme, [X], who ran the Miami portion of the operation, arranged for the purchase of hundreds of cases of cigarettes from Panama and the transportation of

those cigarettes into the Port of Miami. He then arranged for the purchase of other cargo, such as yarn, wood flooring and building insulation material, to be used as cover loads to conceal the cigarettes. Roman Vidal directed

the preparation of false bills of lading that only declared the cover load materials. These bills of lading were presented to the shipping companies and overseas customs services. Custom duties and taxes were based only on

the falsely declared cargo and thus, no duties or taxes were paid on the cigarettes.On four separate occasions from December 2001 through April 2008, Roman Vidal smuggled 2,702 master cases of cigarettes - totaling more than 27 million individual cigarettes - out of the Port of Miami. Based upon the false bills

of lading, only a few thousand dollars of custom duties and taxes were paid on each shipment. The true custom duties and taxes that should have been paid on these shipments totaled over $6.5 million dollars.

Acting U.S. Attorney Jeffrey H. Sloman commended the investigative efforts of the ICE special agents as well as agents from various law enforcement agencies in Ireland, Great Britain, Spain and Germany involved in this case. In addition, Mr. Sloman thanked the European Union Anti-Fraud Office based in

Brussels, Belgium, for their outstanding contribution to the investigation. Additional commendation was extended to Lincoln Jalelian, former Trial Attorney with the U.S. Department of

Justice, Organized Crime and Racketeering Section, for his significant contribution to the case. The prosecution is being handled by Assistant U.S. Attorney Cynthia Stone.

Press Release by United States Attorney for the Southern District of Florida.

Thank you