November 25, 2025 • 35 mins
Illegal tobacco is no longer a back-alley trade — it’s a billion-dollar criminal economy fuelling arson, extortion, murders and a full-blown underworld war across Australia. In this explosive episode of Real Crime, Adam Shand uncovers how half of all tobacco consumed in Australia has slipped into the shadows, and why the government’s own excise regime is driving the demand.
Adam speaks first with freight-forwarding director Kelly Crossley, who is on the frontline of the smuggling pipeline. She reveals how syndicates exploit the container trade, steal legitimate ABNs, forge identities and slip tonnes of illicit cigarettes through overstretched border systems — sometimes within sight of police stations.
Then Adam sits down with former AFP officer Rowan Pike, who established Australia’s first illegal tobacco strike team. For a decade, Pike warned that sky-high excise, lax policy, and a lack of coordinated enforcement would create exactly the chaos we’re seeing now. Pike breaks down how the black market exploded, why seizures barely make a dent and why Australia is now facing a criminal landscape more profitable than the drug trade.
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:05):
Appoche production.
Speaker 2 (00:14):
Welcome to Real Crime with Adam shannd I'm your host,
Adam Shann. Let's talk about illegal tobacco today. It's absolutely
swamping our market here.
Speaker 3 (00:22):
Please say, out of three hundred tobaccoos in Victoria, one
thousand sells Michael cigarettes.
Speaker 2 (00:28):
Back in twenty fifteen, it represented just fourteen percent of consumption.
This year it's expected to hit fifty percent. The crooks
rked in ten billion dollars last year, and the trade
is fueling violence, murder, arson as two syndicates seek to
monopolize the trade.
Speaker 3 (00:47):
Firebombings, violent turf groups, and even murder.
Speaker 2 (00:54):
The profits are absolutely staggering, more than what the crooks
make from the top five drugs.
Speaker 4 (01:00):
Combined efforts by organized crime groups to control the illicit
tobacco and beat market led to over two hundred fire
bombings at least three homicides, including an innocent civilian.
Speaker 2 (01:11):
The illegal trade is literally facilitated by the federal government.
The excise on smokes has taken a packet to fifty dollars,
whereas you can buy the illegal version for just fourteen bucks.
Same product, just as deadly, just as addictive. It's so
widespread and entrenched. Your average law abiding citizen has no
(01:32):
qualms in going to the illicit market. I've seen this
in shops in my local area, about one hundred meters
from the local cop shop, and they do absolutely nothing
about it. Later in the program, I'm going to talk
to former Australian Federal Police officer Rowan Pike about why
the good guys are losing the battle. But first let's
talk about how these smokes are getting into this country.
(01:54):
Kelly Crossley is in the freight forwarding business, which is
right at the frontline of the trade.
Speaker 5 (01:59):
She's a director of Perth based Transittainer.
Speaker 2 (02:02):
Welcome to real crime, Kelly, thank you, thanks for having me, Adam,
absolute pleasure. Now tell me what is freight forwarding. Let's
get the definitions right here.
Speaker 3 (02:12):
Freight forwarding so we are the people that do the
importing and exporting for the actual importers or exporters. So
we arrange the containers on the vessel book the slots,
ship it over here and then we clear it through
customs and quarantine and deliver it to their door. So
all the moving parts of the supply chain basically.
Speaker 2 (02:32):
And so what we're discovering is this illegal trade is
not coming in boats smuggled into the vast distances of Australia.
It's coming in through the container trade. How is it
getting in in your experience, Well, it's.
Speaker 3 (02:47):
Coming in through the container trade, but it's also coming
in through air freight. So there's two ways that's coming in.
There's a few things that are happening at the moment.
There's one thing that's I guess is pretty big. Is
called piggybacking or ABN fraud or ABN identity theft. So
people are taking a legitimate importer's ABN, pretending to be
(03:10):
that business and then using the ABN commercial documents, presenting
those documents two way freightfulder, a customs broker like us,
and then clearing the cargo none the wiser to the
poor importer. So the poor importer's ABN and somebody's details
have literally just been used.
Speaker 1 (03:27):
They have no clue and a lot of it's coming
in like that.
Speaker 2 (03:31):
So these illegal importers are using the AABN numbers of
legitimate importers.
Speaker 5 (03:37):
Why are they not aware this is happening using their ABN.
Speaker 3 (03:41):
Suppose in the way, who's alerting them? Like, how do
they know it's ab and look up my ABN, your
ab and everybody ABN is. It's available to the public.
It's there and LinkedIn. All your details are there. You
can go on a business's web page and you can
have a look at their company logos, letterheads, you can
copy all their details. ABN's right there for the taking.
(04:05):
And that's the way we do a customs entry is
via a ABN. So yeah, if we get that ABN,
or if a broker gets that ABN, an importer just
wouldn't know.
Speaker 1 (04:16):
A business would not know.
Speaker 3 (04:18):
Because an ABN is there for everybody to see on
a public website from ab and look up.
Speaker 5 (04:24):
And so correct me if I'm wrong.
Speaker 2 (04:25):
The importer, the illegal importer goes through a freight forwarding
company that facilitates this.
Speaker 3 (04:32):
Yes, correct, So anything that comes into the country must
be declared to ABF Customs and Quarantine. So in order
to do that, you would engage a customs broker or
a freight folder. As a customs broker, we need to
be doing our due diligence and doing all the correct
checks to make sure that that person has been identified.
(04:53):
It is getting harder and harder to do, so we've
got to go through the processes and everything is from
our side is electronic. So we're looking at a set
of commercial documents that is a commercial invoice of packing,
list of packing, declaration and a bill.
Speaker 1 (05:08):
Of lading for example, that is declaring what the goods are.
Speaker 3 (05:13):
We're classifying the goods, putting him into home consumption and
collecting the revenue from the importers. So it's us, it's ABF.
We're on the front line of what's happening.
Speaker 2 (05:26):
You talk about due diligence. How much due diligence can
you do? Are there any red flags? Or I mean,
is it practical that you could be checking every single
ABN but it's not being used by a crook.
Speaker 3 (05:38):
My business, we have a very very strict procedure with
what we do in terms of checking the ABN, and
there are multiple steps for checking that. And we have
picked up piggybacking and we've alerted importers to the piggybacking
several occasions.
Speaker 1 (05:54):
Do other companies do it?
Speaker 3 (05:56):
Look, I would hope so, But you know we're all
that we're under resource. People may not be or importers
or freight forwards and brokers may not be doing as
much I would hope. So, but you know it's up
to the business, I guess, and that business has to
have their own procedure in place, and it needs to
be a bit more education about what's happening. But you know,
(06:18):
we have maybe bigger folders and things that might not
have that time or might not have the resources. So
what checks they do, I don't know. I can't speak
for those.
Speaker 1 (06:26):
For US strict, very strict process, but.
Speaker 2 (06:30):
The crooks this is always an arms rates and the
crooks find ways to dupe other elements in the supply
chain to facilitate this. So it's a huge volume of
trade coming in and I know it's physically impossible for
the Australian Border Force and Customs to actually check every container,
check every air freight coming in.
Speaker 5 (06:50):
So this really plays towards the crook's strengths.
Speaker 2 (06:53):
Doesn't it that It's add lots of costs to the
system were we to check every container, check every ABN.
Speaker 3 (07:00):
Correct, Yes, I mean, look, it's a too pronged approach
where the forwarder needs to be obviously doing it because
if it doesn't get past the folder or the broker,
that feed or that customs entry can get flagged and
not get lodged, so it can stop, you know, at
our level, should it not stop at our level? Obviously
ABF have also their own ways of doing checks, you know,
(07:22):
see cargo and manifests, and it's quite complex, but they
have other ways. And of course we have ABF and
things on the ground where containers and loose cargo and
air freight goes through X ray machines, so many would
be randomly selected and obviously targeted. But again, yeah, we
can't X ray every single container that comes off the terminal.
(07:44):
It's just not possible. So we're playing right into their
hands for sure.
Speaker 2 (07:48):
And when you have picked up these piggybacked shipments, what
were the tells that you saw?
Speaker 3 (07:55):
For me, it's a bit of experience, but you know
there's some things that we have in place and you
can see. Is getting hold of an importer it should
never be hard. You should be able to pick up
the phone and actually speak to somebody on the other
end of the phone right moving addresses several times, so
you might have contact, or our staff ember may have
contact via mobile. You might even have a conversation with somebody,
(08:17):
so it may sound legitimate. But if the address changes
three four, five, times, and it's last minute that starts
to raise a few red flags. Sometimes the urgency which
you know again judgment, there are very urgencyments that that happen.
But the urgency can be where is it, I need
it now, what's happening with it? Why is it on hold?
Speaker 1 (08:37):
Why?
Speaker 3 (08:38):
So I guess reading somebody's vibe through through conversation. The
other thing is, though, when documents come through, is you
have to be really stringent with your checks and domain.
For example, for a business name, it will be changed
ever so slightly, So we need to look at the
domain on a website address and if the domain on
(09:00):
the real import or the business's website addresses, say at
train Entertainer WA, dot com dot au, that's.
Speaker 1 (09:07):
The real one.
Speaker 3 (09:08):
The fake one may be slightly missing an eye in transittainer.
That's how clever they are, Like who's going to pick
that up? And that's how they get away with it.
So they will literally use they could use my ABN,
my logos and the little eye in transittainer could be missing.
Speaker 1 (09:24):
It's easily oversea, so you have to do those real
detailed checks.
Speaker 2 (09:31):
And of course the freight forwarder is not committing a
crime by being duped by the dodgy importer.
Speaker 5 (09:38):
So it's not up to your.
Speaker 2 (09:41):
Side of things to be the police as it were.
You're just doing your part of the process.
Speaker 3 (09:46):
Yeah, absolutely, definitely not up to us. We obviously have
a responsibility to holding a corporate license and a customers
broker has a responsibility to the Commonwealth and to the
government to collect the revenue all those sorts of things.
So whilst we can't police it and it's not our job,
it is our job to be checking for vicious activity,
and if we are suspicious, we should not lodge the entry.
(10:09):
And that's pretty much what it comes down to. It
should be flagged and we don't launch it, and we
should be raising alarm bells about it. So we can't
police it, but we certainly have a responsibility to do
something about it and take our responsibility serious.
Speaker 5 (10:22):
Yeah, but it seems like it's there.
Speaker 2 (10:24):
I say, it's more a moral responsibility than a binding
legal one.
Speaker 3 (10:29):
No, we still have you know, there's legislation in place,
to be honest, I think that's why there's that's a
whole other story we can cover one day. The shortage
on customs brokers because of the legislation and the pressure
that they are put under.
Speaker 1 (10:41):
It's tough. It's a tough gig. They can be.
Speaker 3 (10:43):
Held responsible if we don't do the right checks and
we are lodging entries and you know, look to be
seen giving a false statement.
Speaker 1 (10:51):
They come down hard on us.
Speaker 3 (10:52):
It's tough, and that's why the customs brokers are probably
putting their hands up now and saying, I don't want
to be doing this gig anymore.
Speaker 1 (10:59):
We have an industry shortage.
Speaker 3 (11:00):
People are walking away from wanting to take on that
responsibility and you know, looking at or losing their career
or who knows, end up in jail for it.
Speaker 1 (11:09):
So it is tough.
Speaker 5 (11:10):
It's hard because it's pretty rich.
Speaker 2 (11:13):
I think to be blaming the freight forwarder who might
have been duped by a very sophisticated, very clever bunch
of crooks.
Speaker 5 (11:21):
You're not making any money out of it. The crooks are.
Speaker 3 (11:24):
You've got all the risk, absolutely, you know that's one
hundred percent spot on. The risk is on us and
you know ABF under resource. So the risk is it
really does it falls on us, and it's tough, and
you know what happens if it does pass us? As
maybe the initial gatekeeper. Why should we be held responsible.
Why isn't it ABF's problem or why isn't it But
(11:47):
I guess as a business and you know your own morals,
you know you have to take those seriously and certainly
not on us.
Speaker 1 (11:53):
But we have processes and things we must do.
Speaker 2 (11:56):
Still, we're seeing a lot of these cigarettes coming through
Dubai and particularly a free trade area in Dubai, and
the brand we're seeing is Manchester. Quite often it's a
Syrian company, I've understand. Do you start to look at
the source of the shipments as a possible red flag?
Speaker 3 (12:17):
Yeah, locations absolutely, I think all the other indicators have
to be first. Getting a random set of documents from
a random email address, you know, gmails, hot miles, those sorts.
Speaker 1 (12:27):
Of things are straight away for me.
Speaker 3 (12:30):
And look, it's hard because we have a lot of gmails,
and especially dealing with with China and all sorts of countries,
we have them all the time. But a random set
of documents straight away from a Gmail address is a problem. Yes,
Jabilali and those sorts of places, and we've had one
from there, to be honest with you, Commodities that we
(12:50):
need to be looking at, definitely for us, we just
need to look at those documents where they've come from
and do all the checks. Load ports, countries, commodities definitely
do come under scrutiny, probably more for ABF. I guess
we are doing our normal process. ABF would probably look
at that more than what we do.
Speaker 2 (13:07):
We've seen a talk fest, various police ministers and industry
folks getting together to talk about this problem, but they
won't address the elephant in the room. The exercise is
driving this trade and they're doing nothing to affect the
demand for the product. Would you expect to see anything
change simply by another Let's get tough, let's tighten the rules,
(13:30):
possibly even put more owners on the freight forwarders and
the innocent parts.
Speaker 5 (13:34):
Of this trade.
Speaker 1 (13:35):
Ye, that's tough.
Speaker 3 (13:36):
I mean, yeah, potentially, and it's not helping, that's for sure.
And that's probably another issue and not from my area
to say, I guess, but yeah, the rates on the
judy are just astronomical and yeah, obviously that leads to
what is happening now. And you know criminals aren't going
to do it if they're not going to make money, right,
So do we lower those rates? Do we change that?
(14:00):
That's a tough one.
Speaker 2 (14:03):
Well, it's the definition of madness not to change something
when you see it's not working. And they claim to
have reduced smoking rates. I think Hegret's still killed twenty
thousand strains every year. That's not changing too much. I mean,
we've always seen this prohibition in America creates the Chicago underworld.
Speaker 5 (14:19):
I mean, you can blame that the crooks for what
they're doing.
Speaker 2 (14:21):
They're setting fires, they're murdering people, there's all this violence
going on.
Speaker 5 (14:25):
But where the government doesn't want to change.
Speaker 2 (14:27):
Particularly where it seems very irksome to me that more
owners should fall on the legal parts of the trade
in other words of freightforward as the retailers, when it's
the government take it that's facilitating this at it's.
Speaker 3 (14:40):
Heart, Yeah, I would like to see it change, Yeah,
because you know, I think also that the funds from this,
what people have to realize is the amount of money
that they are making and then the other criminal activity
that it goes to is probably more frightening as well.
So with the government take a backstep though, you know
they're not going to, which is sad, because you're right,
something has to change. This is only going to get worse.
(15:02):
The criminal activity is going to get worse. About the
figures already, it's going to get worse. How much more
can we do? We're doing enough as it is. Now
something has got to change.
Speaker 5 (15:13):
Thanks for that, Kelly.
Speaker 2 (15:15):
That's Kelly Crossley from Transittainer in Perth on how the
illegal cigarettes are getting into this country.
Speaker 5 (15:22):
In a moment, we'll talk.
Speaker 2 (15:23):
To Rowan Pike, a former Australian Federal Police officer who
was involved in the first task force into illegal tobacco.
Speaker 5 (15:31):
That'll be Rowan Pike after the break.
Speaker 2 (15:37):
It's a truism that you can prohibit something, but you
can't make it unpopular. Government intervention in the market for alcohol, drugs, now,
tobacco has always driven the black markets.
Speaker 5 (15:48):
There would have.
Speaker 2 (15:49):
Been no al Capone if it wasn't for prohibition of alcohol.
Tobacco is still legal, of course, but the excise regime
has literally created the underworld war we're seeing across this
country as syndicates battle for control of this lucrative market.
Speaker 6 (16:05):
Financial year, the Australian Border Force intercepted over two point
five billion illegal cigarettes, enough to avoid four point three
six billion dollars in duty.
Speaker 2 (16:16):
Rowan Pike is a former Australian federal police officer who
established Australia's tobacco Strike Team while working at Border Force.
Speaker 5 (16:24):
But ten years he's.
Speaker 2 (16:26):
Been saying government cannot continue to increase tobacco excise without
boosting the resources for enforcement. They didn't listen, and exactly
what Roan predicted has come to pass.
Speaker 6 (16:38):
Organized crime now has a stranglehold on the illicit tobacco market.
Speaker 2 (16:44):
We're now seeing summits and task forces, new laws and
crackdowns to combat this scourge.
Speaker 5 (16:50):
But is it too little? Two leg? Let me welcome
Rowan to real crime? Can I run? Hi? How are
you going? Good? Thank you bikey. You must be bored
of saying I told you so?
Speaker 2 (17:03):
Yes, well, I have said that a few times recently,
but to be honest, doesn't give me much satisfaction in
doing so. I'd rather just help fix the problem in
Australia and overseas. But they haven't been listening. Doesn't say
much for my advocacy in the topic. But they have
finally put turning their minds to enforcement. But as you say,
(17:24):
it may well be too little, too late. Well, yeah,
I tend to think governments are as addicted to the
excise revenue. As smokers are to nicotine, they can't kick
the habit, and that's the crux of the issue. How
much enforcement is enough to make a dent on this,
that's a good question. So the answer is we don't know,
(17:45):
because we've never had a decent crack at the enforcement.
Even the convention that we signed twenty two years ago
which started the high taxing regime and hundreds of other
regulations that surround the tobacco industry that twenty two years later,
that actually said that we should upscale our enforcement activities
(18:06):
in order to protect against elicit tobacco, but we ignored that.
Then there was another convention came out ten years later
specifically targeted at elicit tobacco from the World Health Authority,
and Australia has refused to sign that. So that has
been our attitude up until recently. And it's only really
the criminals blowing each other up and murdering each other,
(18:28):
which has focused the attention of authorities and really embarrassed
them into some sort of action.
Speaker 5 (18:35):
So is it going to work. I'm not overly confident.
Speaker 2 (18:38):
It could have worked ten to fifteen years ago when
we first started talking about it, But as I say,
no one's ever had a real decent shot at the
enforcement side, and certainly it won't hurt. Certainly, the way
that criminals are getting their product to market through thousands
of shops on the high Street is just simply embarrassing,
and that access and availability is driving smoking rates to
(19:01):
actually go up. So that can certainly be dressed, but
it's going to take a sustained larger enforcement effort than
what we currently envisage.
Speaker 5 (19:10):
Well, I was.
Speaker 2 (19:10):
Seeing recently all these big press conferences and talk about
new state laws and increasing the fines on retailers and
so and so forth, and it all sounds great, And
they've been show and tells where they've seized all this tobacco,
but no one's talking about excise. No, well, excis is
clearly the driver. They've got their head in the sand
(19:31):
about that. There needs to be a holistic review of
our tobacco control policy and that includes exercise, which is
clearly driven it. You said at the top that they're
addicted to the revenue, but the revenue is gone, if
not entirely, but it's well on the way. So it's
dropped from sixteen billion to seven point seven and on
(19:52):
the current trajectory. It'll be one or two billion in
a couple of years, and no one will be smoking
the legal product. Why would you when it's four or
five times more than the illegal product, so they won't
have that to fall back on. But say, every state
and territory is doing something different, So so much for
the coordinated collaborative response that the federal government's supposed to
(20:14):
be coordinating. Everyone's doing something different, and we're yet to
see whether any of those things that they're doing going
to have a positive effect. You again, you mentioned seizures
that they love standing behind a big table full of
sizars or rolling out the numbers the X million dollars
of cigarettes. What I've come to know through my time
in the public service and beyond, is that cazars have
(20:37):
no effect on the availability of the product. They're just
simply bombarding the border with billions of cigarettes. And they
sound like big numbers. They are big numbers, but when
the profit margins thirty or more to one, they can
afford to lose ten twenty container loads and the next
one is still going to make a profit. So caizures
(20:58):
have little disruptive effect on the organized crime syndicates. I
think yes, because this goes a lot further than just
supplying tobacco to consumers.
Speaker 5 (21:08):
We're seeing a whole new criminal underworld. I note that
Kashamad is one of the big syndicate leaders. He was
deported after being busted for heroin. If he'd knowed about tobacco,
he wouldn't have bothered with heroin. He would have gone
straight to tobacco, and he's making literally billions. Now, yeah,
that's right.
Speaker 2 (21:25):
So some of the criminal syndicates are diversifying away from
drugs into tobacco because it's much lower risk and just
as high profit. Kaz As, you say as the classic
example from a heroin importer now tobacco deal. But there
were syndicates in the past. It just hasn't exploded overnight
this problem. It's been going for decades. But the criminals
(21:47):
previously were clever enough to not alert authorities to what
they were doing and flew under the radar and just
quietly accumulated vast sums of wealth without upsetting authorities.
Speaker 5 (21:58):
But Kazas sort of upset the apple cart.
Speaker 2 (22:01):
Are now all of those syndicates who were previously doing it,
but also new ones and opportunists are coming into the market,
realizing how easy it is. We had this moment where
the syndicates began to talk about the Commission, which getting
together and regulating the market together.
Speaker 5 (22:18):
It's kind of scary.
Speaker 2 (22:19):
But also we saw previously when gangsters try to do that,
they end up shooting each other, they end up blowing
each other up.
Speaker 5 (22:28):
They don't play well together. So I wonder whether.
Speaker 2 (22:31):
Disunity is really an ally to enforcement here to arrest
enough people to get resources inside these empires, to map
an enforcement strategy that might actually work.
Speaker 5 (22:43):
Yes, I agree, totally agree.
Speaker 2 (22:45):
As I said, there was an unwritten agreement between syndicates
going back decades to not upset the apple cart. But
Kas has certainly done that and the commission. I mean,
it's just pure greed. He's wanted to take over a
lot that has brought attention to himself and has meant
that there's.
Speaker 5 (23:05):
Been a law enforcement response.
Speaker 2 (23:07):
So here in Victoria, in particular Victoria Police are doing
a great job, spending lots of resources and money tackling
this organized crime skirt. And in fact, even yesterday Kaz's
uncle was arrested, so he's clearly one of according to
Victoria Police, probably one of the main players here, but
Kaz needs people on the ground to assist his activities,
(23:28):
so it goes on. You know, we heard the terms
you can't arrest your way out of a problem, and
that's a nice thing to say, but again, we've never really.
Speaker 5 (23:37):
Tried in the tobacco space.
Speaker 2 (23:39):
So it'll be interesting if we do start locking up
some of the big players, what effect that does have
on these syndicates and whether that pulls them up a bit.
Speaker 5 (23:48):
Well.
Speaker 7 (23:48):
Indeed, his uncle who's alleged to be his number one
lieutenant on the ground, I know he's a former policeman,
but I wonder whether you just make a vacancy for
somebody else. I mean they're doing that certainly with the
arson squads that are running around. They're giving Paul Tree
sums to people to run around, standing over shopkeepers and
burning down shops that won't comply.
Speaker 5 (24:11):
I'd be interested to see what an all out blitz
would look like.
Speaker 2 (24:16):
Yeah, I don't think they, well, the state governments around
the country really really understand the resources and funding required
for an all out blitz when there's thousands of shops.
I mean, Victoria's talking about fourteen inspectors with they don't
have powers or weapons, or security or training. I don't
think they're going to make much of a dentt in
(24:37):
the thousands of shops. There's thirty within two columns of
my house here, so it's everywhere, and it takes a
much bigger effort to make a dentt in it, certainly
than what authorities currently understand. But yes, it's going to
be interesting times coming forth. But as you say, someone
else will step up if people get arrested. And that's
(24:58):
why I say it's easy to say this when you've
left law enforcement. When you're in law enforcement, making arrests
and charging people and locking them up is the bill
and end all of what you do. You're following the
legislation and so on, and you think that this is
going to have a great effect.
Speaker 5 (25:14):
But after you leave, you think that there might be
a better way.
Speaker 2 (25:17):
And there are a couple of better ways in addressing
the policy which needs to change in order for this
to not continue on. Okay, Well, in a parallel universe,
Rowan Pike becomes the chief commissioner of this Raini Vidual
Police or the Border Force, and he said unlimited resources.
Speaker 5 (25:34):
He's speaking to the states. What does he do.
Speaker 2 (25:38):
Well, he goes to the government for a start and says,
there's three ways of fixing this. Firstly, you have to
admit that the policy that you've been following for the
last ten years has failed and is incorrect and needs
to be reviewed. So the government hasn't actually admitted that yet.
So as the commissioner, they would have the power to
influence government thinking on this matter. But remembering that's the
(26:02):
Health Department that is still in charge of tobacco control policy.
So that's one of the many difficulties in this space
for law enforcement agency to influence health policy. But let's
just say they did, they would say that the excise
has to come down, the enforcement has to increase multiple
(26:22):
times over. And thirdly, we have to start thinking about
harm reduction. So even though everyone has been rainwashed to
think that bapes are the worst thing on the world
and everyone's going to die if you're taking vote and
also nicotine pouches, if you look overseas, which Australia rarely
do in this space, the countries that have succeeded in
reducing their smoking rate, which is the endgame at the
(26:45):
end of the day, because smoking is the worst possible thing.
L the countries that have succeeded are the ones that
have embraced harm reduction in terms of transitioning smokers away
from deadly cigarettes into safer nicotine products, and we need
to address that issue. So those three things all I'm
into play. It's not just simply a matter of enforcement. Yeah,
(27:09):
as you say you're out of the job, would you
want to take on that job?
Speaker 5 (27:12):
Are you a massochist?
Speaker 4 (27:14):
No?
Speaker 2 (27:14):
I think there's a Well, there's a new commissioner there,
and I'm sure she looks very sensible, But yeah, if
she wants to take this on, it's a bit of
a poison chalice, given that, as I say, she's battling
against agencies that are not under her influence. The Health
Department is just dead set on carrying on doubling down
on this bad policy, and until that changes, no matter
(27:37):
how much enforcement you throw at it, I don't think
it'll be fixed. I don't have much confidence that it
is going to be fixed. And I think we're going
to continue to see. I think there's governments with tax
a bit like junkies. They'll keep consuming their tax revenue
even if it's diminishing. They'll continue to do the same
thing till it's all gone. Basically, and under that scenario
(27:58):
where we don't address the actual issue, what does this
look like? Because I can see this illegal tobacco revenue
funding the underworld all other kinds of offenses, guns, money laundering,
you name it, and we're going to have a seriously
entrenched underworld that will affect everybody. Well, yes, that's exactly.
(28:20):
It's easy to envisage that happening. In fact, I would
suggest that it's entrenched now. We're already at that point.
There are just a few smokers that are just hanging
on to their favorite brands and so on. But given
cost of living, crisis inflation, just access and availability of
the illicit product, those last smokers are likely to move over.
(28:43):
It's easy to predict that the end of the legal
market for various reasons. One is obviously the excise and
people don't want to pay it. But there's also shopkeepers
who are being threatened every day, multiple people, with the
fact that they've got tens of thousands of dollars a product,
a very valuable product.
Speaker 5 (29:02):
Sitting behind their counter.
Speaker 2 (29:03):
And I certainly wouldn't want to be doing that in
a service station or a seven eleven late at night.
It's a really dangerous business to be in now, so
there's going to be less people actually want to sell
the product, and at the end of the perhaps in
a couple of years, the criminals will run the entire
tobacco market. There will be just as many people smoking,
but the government won't be getting any of the revenue.
Speaker 8 (29:25):
So there's a little talk about targeting the offshore syndicate
leaders into pole all this type of stuff, but you
catch one, the market still exists.
Speaker 2 (29:38):
Excise is the only way to address this. Really, it's
certainly a key one. The criminals are attracted by bad policy,
so all around the globe they sit there and look
for vulnerability in tax policy for a commodity at tobacco
or alcohol or anything else. They've obviously targeted. Australia has
(29:59):
been vulnerable and they're throwing all their vast resources at us,
which has overcome the ability of our law enforcement to
stop that happening. So, yes, you can lock up five
to ten of them, but the product is going to
keep coming to satisfy the market of people who actually
want this product, and that's increasing now that it's so
(30:20):
cheap as well.
Speaker 5 (30:21):
Well, that's right. I mean, I think this is a
bit like s book making. The sp bookmaker was a
friend to people in the community. They weren't going to
put him in.
Speaker 2 (30:30):
If you're buying cheap smoke from the retail around the corner,
whether it's a crook or not, you're very reluctant to
get involved and point the finger. I mean, I've got
one shop operating in my area about fifty meters from
a police station and they're happy as larry.
Speaker 5 (30:45):
So I mean, in an.
Speaker 2 (30:46):
Already stretched police force in the States, you can't see
the resources. I mean, Victoria can't get enough officers to
do the basic stuff now, let alone take on a
whole nother gangland war if you like.
Speaker 5 (30:58):
So something has to change and it's not changing. No, no,
it's not.
Speaker 2 (31:03):
And the Victoria place rather be doing one of the
multiple other responsibilities they have. But as you say, the
government occasionally brings out that argument about do you realize
what you're doing. You're just promoting organized crime and making
them stronger. But that has zero effect on your average
consumer who just sees a ten dollars product and a
(31:25):
fifty dollars product and says it's a no brainer. So
I mean, even though Australians are generally laura abiding, there
is a limit to the faith, I guess, and the
trust they have in government policy. And when that faith
is broken, which it obviously is now, then people will
have no qualms about breaking the law or moving to
(31:46):
the illegal product. And they're doing that in droves, and yeah,
that trust, if you like, and even their reliance on
the product itself. You know, they're happy with a certain
brand that they might have had for ten or twenty years.
That's broken as well, and now it's just all downhill. Really,
that's right, because I mean talk about a safe smoking product.
(32:07):
I mean, tobacco is bad for you, whether it's good
quality or bad quality, and people will buy it as
long as it's got nicotine and you know it doesn't
make you sick as soon as you smoke it.
Speaker 5 (32:16):
So I think a hiding to nothing, Roan.
Speaker 2 (32:18):
I hope we aren't having this conversation in two or
three years time when the legal tobacco is now sponsoring
the footy or something.
Speaker 5 (32:27):
Yes, no, I think they've had that.
Speaker 2 (32:29):
We're not going to reverse our policy to that extent,
but I'm not really sure what it's going to take
for the government to wake up that the policy has failed.
So you know, there's murders, there's innocent victims, there's shopkeepers destroyed,
there's no revenue, there's tobacco smoking rates going up. Yeah.
I just don't know how bad it has to get
(32:51):
before the government says, oh, okay, we might have got
this wrong and reverse some of these policies. But my
experiences was the Gangland War down here in Victoria and
the proliferation of party drugs back then. We really haven't
seen advances in UG reform to address the demand for
these product That's where it begins. And so I can
see the same thing rolling through again that the governments
(33:13):
are unlucky to reform these deeply entrenched policies. Like you say,
I mean the fact that the Health Department, for God's sakes,
is in charge of this. This should be under justice,
it should be under the border agencies, but it's not.
I mean, how do we get that simple change to
get the right public bodies to be enforcing it.
Speaker 5 (33:33):
I don't know.
Speaker 2 (33:34):
We've had multiple federal inquiries that have all said the
same thing, that the Home Affairs Department or law enforcement
agencies should be running the show. This is an organized
crime problem which is clearly out of the remit of
the health department, and yet health departments still are running
the show. So we should just thank them for creating
(33:54):
a problem, and then they need to stand aside and
let the groin ups into the room and to try
to fix this. Unfortunately, fixing it includes changing the policy
that health started, and they're highly reluctant to do so.
Speaker 5 (34:08):
They certainly are.
Speaker 2 (34:09):
And I can't see you going back into the fray
row and you'd be better off on the sideline at
this stage.
Speaker 5 (34:12):
So thanks for your time today, my pleasure. Thank you.
That's right on park.
Speaker 2 (34:19):
Former Australian Federal Police and Border Force run the Tobacco
Strike Team Thinca's issue here, of course, is our tax system.
We don't get our richest people to pay their fair
share of tax, so traditionally the burden has fallen on
the sinners, the drinkers, the smokers, the betters, this sort
of thing. So, as Rowan says, until we get a
change in emphasis, look at excise, we're just going to
(34:41):
be playing catch up here and all the coppers in
the world and all the show and tells and all
the siegures will make no difference whatsoever, because, as I
said of the outset, you can prohibit something, but you
can't make it unpopular.
Speaker 5 (34:53):
Are you buying illegal smokes?
Speaker 2 (34:54):
Let me know in the comments, or you can also
send me an email Adam Shanner writer at gmail dot com.
If you happen to want to point the finger, can
always call crime stoppers two one and out of Triple three,
Triple zero. I'm not sure many people are doing that though,
but thankfully this has been al and chan for real
crime
Appoche production.
Speaker 2 (00:14):
Welcome to Real Crime with Adam shannd I'm your host,
Adam Shann. Let's talk about illegal tobacco today. It's absolutely
swamping our market here.
Speaker 3 (00:22):
Please say, out of three hundred tobaccoos in Victoria, one
thousand sells Michael cigarettes.
Speaker 2 (00:28):
Back in twenty fifteen, it represented just fourteen percent of consumption.
This year it's expected to hit fifty percent. The crooks
rked in ten billion dollars last year, and the trade
is fueling violence, murder, arson as two syndicates seek to
monopolize the trade.
Speaker 3 (00:47):
Firebombings, violent turf groups, and even murder.
Speaker 2 (00:54):
The profits are absolutely staggering, more than what the crooks
make from the top five drugs.
Speaker 4 (01:00):
Combined efforts by organized crime groups to control the illicit
tobacco and beat market led to over two hundred fire
bombings at least three homicides, including an innocent civilian.
Speaker 2 (01:11):
The illegal trade is literally facilitated by the federal government.
The excise on smokes has taken a packet to fifty dollars,
whereas you can buy the illegal version for just fourteen bucks.
Same product, just as deadly, just as addictive. It's so
widespread and entrenched. Your average law abiding citizen has no
(01:32):
qualms in going to the illicit market. I've seen this
in shops in my local area, about one hundred meters
from the local cop shop, and they do absolutely nothing
about it. Later in the program, I'm going to talk
to former Australian Federal Police officer Rowan Pike about why
the good guys are losing the battle. But first let's
talk about how these smokes are getting into this country.
(01:54):
Kelly Crossley is in the freight forwarding business, which is
right at the frontline of the trade.
Speaker 5 (01:59):
She's a director of Perth based Transittainer.
Speaker 2 (02:02):
Welcome to real crime, Kelly, thank you, thanks for having me, Adam,
absolute pleasure. Now tell me what is freight forwarding. Let's
get the definitions right here.
Speaker 3 (02:12):
Freight forwarding so we are the people that do the
importing and exporting for the actual importers or exporters. So
we arrange the containers on the vessel book the slots,
ship it over here and then we clear it through
customs and quarantine and deliver it to their door. So
all the moving parts of the supply chain basically.
Speaker 2 (02:32):
And so what we're discovering is this illegal trade is
not coming in boats smuggled into the vast distances of Australia.
It's coming in through the container trade. How is it
getting in in your experience, Well, it's.
Speaker 3 (02:47):
Coming in through the container trade, but it's also coming
in through air freight. So there's two ways that's coming in.
There's a few things that are happening at the moment.
There's one thing that's I guess is pretty big. Is
called piggybacking or ABN fraud or ABN identity theft. So
people are taking a legitimate importer's ABN, pretending to be
(03:10):
that business and then using the ABN commercial documents, presenting
those documents two way freightfulder, a customs broker like us,
and then clearing the cargo none the wiser to the
poor importer. So the poor importer's ABN and somebody's details
have literally just been used.
Speaker 1 (03:27):
They have no clue and a lot of it's coming
in like that.
Speaker 2 (03:31):
So these illegal importers are using the AABN numbers of
legitimate importers.
Speaker 5 (03:37):
Why are they not aware this is happening using their ABN.
Speaker 3 (03:41):
Suppose in the way, who's alerting them? Like, how do
they know it's ab and look up my ABN, your
ab and everybody ABN is. It's available to the public.
It's there and LinkedIn. All your details are there. You
can go on a business's web page and you can
have a look at their company logos, letterheads, you can
copy all their details. ABN's right there for the taking.
(04:05):
And that's the way we do a customs entry is
via a ABN. So yeah, if we get that ABN,
or if a broker gets that ABN, an importer just
wouldn't know.
Speaker 1 (04:16):
A business would not know.
Speaker 3 (04:18):
Because an ABN is there for everybody to see on
a public website from ab and look up.
Speaker 5 (04:24):
And so correct me if I'm wrong.
Speaker 2 (04:25):
The importer, the illegal importer goes through a freight forwarding
company that facilitates this.
Speaker 3 (04:32):
Yes, correct, So anything that comes into the country must
be declared to ABF Customs and Quarantine. So in order
to do that, you would engage a customs broker or
a freight folder. As a customs broker, we need to
be doing our due diligence and doing all the correct
checks to make sure that that person has been identified.
(04:53):
It is getting harder and harder to do, so we've
got to go through the processes and everything is from
our side is electronic. So we're looking at a set
of commercial documents that is a commercial invoice of packing,
list of packing, declaration and a bill.
Speaker 1 (05:08):
Of lading for example, that is declaring what the goods are.
Speaker 3 (05:13):
We're classifying the goods, putting him into home consumption and
collecting the revenue from the importers. So it's us, it's ABF.
We're on the front line of what's happening.
Speaker 2 (05:26):
You talk about due diligence. How much due diligence can
you do? Are there any red flags? Or I mean,
is it practical that you could be checking every single
ABN but it's not being used by a crook.
Speaker 3 (05:38):
My business, we have a very very strict procedure with
what we do in terms of checking the ABN, and
there are multiple steps for checking that. And we have
picked up piggybacking and we've alerted importers to the piggybacking
several occasions.
Speaker 1 (05:54):
Do other companies do it?
Speaker 3 (05:56):
Look, I would hope so, But you know we're all
that we're under resource. People may not be or importers
or freight forwards and brokers may not be doing as
much I would hope. So, but you know it's up
to the business, I guess, and that business has to
have their own procedure in place, and it needs to
be a bit more education about what's happening. But you know,
(06:18):
we have maybe bigger folders and things that might not
have that time or might not have the resources. So
what checks they do, I don't know. I can't speak
for those.
Speaker 1 (06:26):
For US strict, very strict process, but.
Speaker 2 (06:30):
The crooks this is always an arms rates and the
crooks find ways to dupe other elements in the supply
chain to facilitate this. So it's a huge volume of
trade coming in and I know it's physically impossible for
the Australian Border Force and Customs to actually check every container,
check every air freight coming in.
Speaker 5 (06:50):
So this really plays towards the crook's strengths.
Speaker 2 (06:53):
Doesn't it that It's add lots of costs to the
system were we to check every container, check every ABN.
Speaker 3 (07:00):
Correct, Yes, I mean, look, it's a too pronged approach
where the forwarder needs to be obviously doing it because
if it doesn't get past the folder or the broker,
that feed or that customs entry can get flagged and
not get lodged, so it can stop, you know, at
our level, should it not stop at our level? Obviously
ABF have also their own ways of doing checks, you know,
(07:22):
see cargo and manifests, and it's quite complex, but they
have other ways. And of course we have ABF and
things on the ground where containers and loose cargo and
air freight goes through X ray machines, so many would
be randomly selected and obviously targeted. But again, yeah, we
can't X ray every single container that comes off the terminal.
(07:44):
It's just not possible. So we're playing right into their
hands for sure.
Speaker 2 (07:48):
And when you have picked up these piggybacked shipments, what
were the tells that you saw?
Speaker 3 (07:55):
For me, it's a bit of experience, but you know
there's some things that we have in place and you
can see. Is getting hold of an importer it should
never be hard. You should be able to pick up
the phone and actually speak to somebody on the other
end of the phone right moving addresses several times, so
you might have contact, or our staff ember may have
contact via mobile. You might even have a conversation with somebody,
(08:17):
so it may sound legitimate. But if the address changes
three four, five, times, and it's last minute that starts
to raise a few red flags. Sometimes the urgency which
you know again judgment, there are very urgencyments that that happen.
But the urgency can be where is it, I need
it now, what's happening with it? Why is it on hold?
Speaker 1 (08:37):
Why?
Speaker 3 (08:38):
So I guess reading somebody's vibe through through conversation. The
other thing is, though, when documents come through, is you
have to be really stringent with your checks and domain.
For example, for a business name, it will be changed
ever so slightly, So we need to look at the
domain on a website address and if the domain on
(09:00):
the real import or the business's website addresses, say at
train Entertainer WA, dot com dot au, that's.
Speaker 1 (09:07):
The real one.
Speaker 3 (09:08):
The fake one may be slightly missing an eye in transittainer.
That's how clever they are, Like who's going to pick
that up? And that's how they get away with it.
So they will literally use they could use my ABN,
my logos and the little eye in transittainer could be missing.
Speaker 1 (09:24):
It's easily oversea, so you have to do those real
detailed checks.
Speaker 2 (09:31):
And of course the freight forwarder is not committing a
crime by being duped by the dodgy importer.
Speaker 5 (09:38):
So it's not up to your.
Speaker 2 (09:41):
Side of things to be the police as it were.
You're just doing your part of the process.
Speaker 3 (09:46):
Yeah, absolutely, definitely not up to us. We obviously have
a responsibility to holding a corporate license and a customers
broker has a responsibility to the Commonwealth and to the
government to collect the revenue all those sorts of things.
So whilst we can't police it and it's not our job,
it is our job to be checking for vicious activity,
and if we are suspicious, we should not lodge the entry.
(10:09):
And that's pretty much what it comes down to. It
should be flagged and we don't launch it, and we
should be raising alarm bells about it. So we can't
police it, but we certainly have a responsibility to do
something about it and take our responsibility serious.
Speaker 5 (10:22):
Yeah, but it seems like it's there.
Speaker 2 (10:24):
I say, it's more a moral responsibility than a binding
legal one.
Speaker 3 (10:29):
No, we still have you know, there's legislation in place,
to be honest, I think that's why there's that's a
whole other story we can cover one day. The shortage
on customs brokers because of the legislation and the pressure
that they are put under.
Speaker 1 (10:41):
It's tough. It's a tough gig. They can be.
Speaker 3 (10:43):
Held responsible if we don't do the right checks and
we are lodging entries and you know, look to be
seen giving a false statement.
Speaker 1 (10:51):
They come down hard on us.
Speaker 3 (10:52):
It's tough, and that's why the customs brokers are probably
putting their hands up now and saying, I don't want
to be doing this gig anymore.
Speaker 1 (10:59):
We have an industry shortage.
Speaker 3 (11:00):
People are walking away from wanting to take on that
responsibility and you know, looking at or losing their career
or who knows, end up in jail for it.
Speaker 1 (11:09):
So it is tough.
Speaker 5 (11:10):
It's hard because it's pretty rich.
Speaker 2 (11:13):
I think to be blaming the freight forwarder who might
have been duped by a very sophisticated, very clever bunch
of crooks.
Speaker 5 (11:21):
You're not making any money out of it. The crooks are.
Speaker 3 (11:24):
You've got all the risk, absolutely, you know that's one
hundred percent spot on. The risk is on us and
you know ABF under resource. So the risk is it
really does it falls on us, and it's tough, and
you know what happens if it does pass us? As
maybe the initial gatekeeper. Why should we be held responsible.
Why isn't it ABF's problem or why isn't it But
(11:47):
I guess as a business and you know your own morals,
you know you have to take those seriously and certainly
not on us.
Speaker 1 (11:53):
But we have processes and things we must do.
Speaker 2 (11:56):
Still, we're seeing a lot of these cigarettes coming through
Dubai and particularly a free trade area in Dubai, and
the brand we're seeing is Manchester. Quite often it's a
Syrian company, I've understand. Do you start to look at
the source of the shipments as a possible red flag?
Speaker 3 (12:17):
Yeah, locations absolutely, I think all the other indicators have
to be first. Getting a random set of documents from
a random email address, you know, gmails, hot miles, those sorts.
Speaker 1 (12:27):
Of things are straight away for me.
Speaker 3 (12:30):
And look, it's hard because we have a lot of gmails,
and especially dealing with with China and all sorts of countries,
we have them all the time. But a random set
of documents straight away from a Gmail address is a problem. Yes,
Jabilali and those sorts of places, and we've had one
from there, to be honest with you, Commodities that we
(12:50):
need to be looking at, definitely for us, we just
need to look at those documents where they've come from
and do all the checks. Load ports, countries, commodities definitely
do come under scrutiny, probably more for ABF. I guess
we are doing our normal process. ABF would probably look
at that more than what we do.
Speaker 2 (13:07):
We've seen a talk fest, various police ministers and industry
folks getting together to talk about this problem, but they
won't address the elephant in the room. The exercise is
driving this trade and they're doing nothing to affect the
demand for the product. Would you expect to see anything
change simply by another Let's get tough, let's tighten the rules,
(13:30):
possibly even put more owners on the freight forwarders and
the innocent parts.
Speaker 5 (13:34):
Of this trade.
Speaker 1 (13:35):
Ye, that's tough.
Speaker 3 (13:36):
I mean, yeah, potentially, and it's not helping, that's for sure.
And that's probably another issue and not from my area
to say, I guess, but yeah, the rates on the
judy are just astronomical and yeah, obviously that leads to
what is happening now. And you know criminals aren't going
to do it if they're not going to make money, right,
So do we lower those rates? Do we change that?
(14:00):
That's a tough one.
Speaker 2 (14:03):
Well, it's the definition of madness not to change something
when you see it's not working. And they claim to
have reduced smoking rates. I think Hegret's still killed twenty
thousand strains every year. That's not changing too much. I mean,
we've always seen this prohibition in America creates the Chicago underworld.
Speaker 5 (14:19):
I mean, you can blame that the crooks for what
they're doing.
Speaker 2 (14:21):
They're setting fires, they're murdering people, there's all this violence
going on.
Speaker 5 (14:25):
But where the government doesn't want to change.
Speaker 2 (14:27):
Particularly where it seems very irksome to me that more
owners should fall on the legal parts of the trade
in other words of freightforward as the retailers, when it's
the government take it that's facilitating this at it's.
Speaker 3 (14:40):
Heart, Yeah, I would like to see it change, Yeah,
because you know, I think also that the funds from this,
what people have to realize is the amount of money
that they are making and then the other criminal activity
that it goes to is probably more frightening as well.
So with the government take a backstep though, you know
they're not going to, which is sad, because you're right,
something has to change. This is only going to get worse.
(15:02):
The criminal activity is going to get worse. About the
figures already, it's going to get worse. How much more
can we do? We're doing enough as it is. Now
something has got to change.
Speaker 5 (15:13):
Thanks for that, Kelly.
Speaker 2 (15:15):
That's Kelly Crossley from Transittainer in Perth on how the
illegal cigarettes are getting into this country.
Speaker 5 (15:22):
In a moment, we'll talk.
Speaker 2 (15:23):
To Rowan Pike, a former Australian Federal Police officer who
was involved in the first task force into illegal tobacco.
Speaker 5 (15:31):
That'll be Rowan Pike after the break.
Speaker 2 (15:37):
It's a truism that you can prohibit something, but you
can't make it unpopular. Government intervention in the market for alcohol, drugs, now,
tobacco has always driven the black markets.
Speaker 5 (15:48):
There would have.
Speaker 2 (15:49):
Been no al Capone if it wasn't for prohibition of alcohol.
Tobacco is still legal, of course, but the excise regime
has literally created the underworld war we're seeing across this
country as syndicates battle for control of this lucrative market.
Speaker 6 (16:05):
Financial year, the Australian Border Force intercepted over two point
five billion illegal cigarettes, enough to avoid four point three
six billion dollars in duty.
Speaker 2 (16:16):
Rowan Pike is a former Australian federal police officer who
established Australia's tobacco Strike Team while working at Border Force.
Speaker 5 (16:24):
But ten years he's.
Speaker 2 (16:26):
Been saying government cannot continue to increase tobacco excise without
boosting the resources for enforcement. They didn't listen, and exactly
what Roan predicted has come to pass.
Speaker 6 (16:38):
Organized crime now has a stranglehold on the illicit tobacco market.
Speaker 2 (16:44):
We're now seeing summits and task forces, new laws and
crackdowns to combat this scourge.
Speaker 5 (16:50):
But is it too little? Two leg? Let me welcome
Rowan to real crime? Can I run? Hi? How are
you going? Good? Thank you bikey. You must be bored
of saying I told you so?
Speaker 2 (17:03):
Yes, well, I have said that a few times recently,
but to be honest, doesn't give me much satisfaction in
doing so. I'd rather just help fix the problem in
Australia and overseas. But they haven't been listening. Doesn't say
much for my advocacy in the topic. But they have
finally put turning their minds to enforcement. But as you say,
(17:24):
it may well be too little, too late. Well, yeah,
I tend to think governments are as addicted to the
excise revenue. As smokers are to nicotine, they can't kick
the habit, and that's the crux of the issue. How
much enforcement is enough to make a dent on this,
that's a good question. So the answer is we don't know,
(17:45):
because we've never had a decent crack at the enforcement.
Even the convention that we signed twenty two years ago
which started the high taxing regime and hundreds of other
regulations that surround the tobacco industry that twenty two years later,
that actually said that we should upscale our enforcement activities
(18:06):
in order to protect against elicit tobacco, but we ignored that.
Then there was another convention came out ten years later
specifically targeted at elicit tobacco from the World Health Authority,
and Australia has refused to sign that. So that has
been our attitude up until recently. And it's only really
the criminals blowing each other up and murdering each other,
(18:28):
which has focused the attention of authorities and really embarrassed
them into some sort of action.
Speaker 5 (18:35):
So is it going to work. I'm not overly confident.
Speaker 2 (18:38):
It could have worked ten to fifteen years ago when
we first started talking about it, But as I say,
no one's ever had a real decent shot at the
enforcement side, and certainly it won't hurt. Certainly, the way
that criminals are getting their product to market through thousands
of shops on the high Street is just simply embarrassing,
and that access and availability is driving smoking rates to
(19:01):
actually go up. So that can certainly be dressed, but
it's going to take a sustained larger enforcement effort than
what we currently envisage.
Speaker 5 (19:10):
Well, I was.
Speaker 2 (19:10):
Seeing recently all these big press conferences and talk about
new state laws and increasing the fines on retailers and
so and so forth, and it all sounds great, And
they've been show and tells where they've seized all this tobacco,
but no one's talking about excise. No, well, excis is
clearly the driver. They've got their head in the sand
(19:31):
about that. There needs to be a holistic review of
our tobacco control policy and that includes exercise, which is
clearly driven it. You said at the top that they're
addicted to the revenue, but the revenue is gone, if
not entirely, but it's well on the way. So it's
dropped from sixteen billion to seven point seven and on
(19:52):
the current trajectory. It'll be one or two billion in
a couple of years, and no one will be smoking
the legal product. Why would you when it's four or
five times more than the illegal product, so they won't
have that to fall back on. But say, every state
and territory is doing something different, So so much for
the coordinated collaborative response that the federal government's supposed to
(20:14):
be coordinating. Everyone's doing something different, and we're yet to
see whether any of those things that they're doing going
to have a positive effect. You again, you mentioned seizures
that they love standing behind a big table full of
sizars or rolling out the numbers the X million dollars
of cigarettes. What I've come to know through my time
in the public service and beyond, is that cazars have
(20:37):
no effect on the availability of the product. They're just
simply bombarding the border with billions of cigarettes. And they
sound like big numbers. They are big numbers, but when
the profit margins thirty or more to one, they can
afford to lose ten twenty container loads and the next
one is still going to make a profit. So caizures
(20:58):
have little disruptive effect on the organized crime syndicates. I
think yes, because this goes a lot further than just
supplying tobacco to consumers.
Speaker 5 (21:08):
We're seeing a whole new criminal underworld. I note that
Kashamad is one of the big syndicate leaders. He was
deported after being busted for heroin. If he'd knowed about tobacco,
he wouldn't have bothered with heroin. He would have gone
straight to tobacco, and he's making literally billions. Now, yeah,
that's right.
Speaker 2 (21:25):
So some of the criminal syndicates are diversifying away from
drugs into tobacco because it's much lower risk and just
as high profit. Kaz As, you say as the classic
example from a heroin importer now tobacco deal. But there
were syndicates in the past. It just hasn't exploded overnight
this problem. It's been going for decades. But the criminals
(21:47):
previously were clever enough to not alert authorities to what
they were doing and flew under the radar and just
quietly accumulated vast sums of wealth without upsetting authorities.
Speaker 5 (21:58):
But Kazas sort of upset the apple cart.
Speaker 2 (22:01):
Are now all of those syndicates who were previously doing it,
but also new ones and opportunists are coming into the market,
realizing how easy it is. We had this moment where
the syndicates began to talk about the Commission, which getting
together and regulating the market together.
Speaker 5 (22:18):
It's kind of scary.
Speaker 2 (22:19):
But also we saw previously when gangsters try to do that,
they end up shooting each other, they end up blowing
each other up.
Speaker 5 (22:28):
They don't play well together. So I wonder whether.
Speaker 2 (22:31):
Disunity is really an ally to enforcement here to arrest
enough people to get resources inside these empires, to map
an enforcement strategy that might actually work.
Speaker 5 (22:43):
Yes, I agree, totally agree.
Speaker 2 (22:45):
As I said, there was an unwritten agreement between syndicates
going back decades to not upset the apple cart. But
Kas has certainly done that and the commission. I mean,
it's just pure greed. He's wanted to take over a
lot that has brought attention to himself and has meant
that there's.
Speaker 5 (23:05):
Been a law enforcement response.
Speaker 2 (23:07):
So here in Victoria, in particular Victoria Police are doing
a great job, spending lots of resources and money tackling
this organized crime skirt. And in fact, even yesterday Kaz's
uncle was arrested, so he's clearly one of according to
Victoria Police, probably one of the main players here, but
Kaz needs people on the ground to assist his activities,
(23:28):
so it goes on. You know, we heard the terms
you can't arrest your way out of a problem, and
that's a nice thing to say, but again, we've never really.
Speaker 5 (23:37):
Tried in the tobacco space.
Speaker 2 (23:39):
So it'll be interesting if we do start locking up
some of the big players, what effect that does have
on these syndicates and whether that pulls them up a bit.
Speaker 5 (23:48):
Well.
Speaker 7 (23:48):
Indeed, his uncle who's alleged to be his number one
lieutenant on the ground, I know he's a former policeman,
but I wonder whether you just make a vacancy for
somebody else. I mean they're doing that certainly with the
arson squads that are running around. They're giving Paul Tree
sums to people to run around, standing over shopkeepers and
burning down shops that won't comply.
Speaker 5 (24:11):
I'd be interested to see what an all out blitz
would look like.
Speaker 2 (24:16):
Yeah, I don't think they, well, the state governments around
the country really really understand the resources and funding required
for an all out blitz when there's thousands of shops.
I mean, Victoria's talking about fourteen inspectors with they don't
have powers or weapons, or security or training. I don't
think they're going to make much of a dentt in
(24:37):
the thousands of shops. There's thirty within two columns of
my house here, so it's everywhere, and it takes a
much bigger effort to make a dentt in it, certainly
than what authorities currently understand. But yes, it's going to
be interesting times coming forth. But as you say, someone
else will step up if people get arrested. And that's
(24:58):
why I say it's easy to say this when you've
left law enforcement. When you're in law enforcement, making arrests
and charging people and locking them up is the bill
and end all of what you do. You're following the
legislation and so on, and you think that this is
going to have a great effect.
Speaker 5 (25:14):
But after you leave, you think that there might be
a better way.
Speaker 2 (25:17):
And there are a couple of better ways in addressing
the policy which needs to change in order for this
to not continue on. Okay, Well, in a parallel universe,
Rowan Pike becomes the chief commissioner of this Raini Vidual
Police or the Border Force, and he said unlimited resources.
Speaker 5 (25:34):
He's speaking to the states. What does he do.
Speaker 2 (25:38):
Well, he goes to the government for a start and says,
there's three ways of fixing this. Firstly, you have to
admit that the policy that you've been following for the
last ten years has failed and is incorrect and needs
to be reviewed. So the government hasn't actually admitted that yet.
So as the commissioner, they would have the power to
influence government thinking on this matter. But remembering that's the
(26:02):
Health Department that is still in charge of tobacco control policy.
So that's one of the many difficulties in this space
for law enforcement agency to influence health policy. But let's
just say they did, they would say that the excise
has to come down, the enforcement has to increase multiple
(26:22):
times over. And thirdly, we have to start thinking about
harm reduction. So even though everyone has been rainwashed to
think that bapes are the worst thing on the world
and everyone's going to die if you're taking vote and
also nicotine pouches, if you look overseas, which Australia rarely
do in this space, the countries that have succeeded in
reducing their smoking rate, which is the endgame at the
(26:45):
end of the day, because smoking is the worst possible thing.
L the countries that have succeeded are the ones that
have embraced harm reduction in terms of transitioning smokers away
from deadly cigarettes into safer nicotine products, and we need
to address that issue. So those three things all I'm
into play. It's not just simply a matter of enforcement. Yeah,
(27:09):
as you say you're out of the job, would you
want to take on that job?
Speaker 5 (27:12):
Are you a massochist?
Speaker 4 (27:14):
No?
Speaker 2 (27:14):
I think there's a Well, there's a new commissioner there,
and I'm sure she looks very sensible, But yeah, if
she wants to take this on, it's a bit of
a poison chalice, given that, as I say, she's battling
against agencies that are not under her influence. The Health
Department is just dead set on carrying on doubling down
on this bad policy, and until that changes, no matter
(27:37):
how much enforcement you throw at it, I don't think
it'll be fixed. I don't have much confidence that it
is going to be fixed. And I think we're going
to continue to see. I think there's governments with tax
a bit like junkies. They'll keep consuming their tax revenue
even if it's diminishing. They'll continue to do the same
thing till it's all gone. Basically, and under that scenario
(27:58):
where we don't address the actual issue, what does this
look like? Because I can see this illegal tobacco revenue
funding the underworld all other kinds of offenses, guns, money laundering,
you name it, and we're going to have a seriously
entrenched underworld that will affect everybody. Well, yes, that's exactly.
(28:20):
It's easy to envisage that happening. In fact, I would
suggest that it's entrenched now. We're already at that point.
There are just a few smokers that are just hanging
on to their favorite brands and so on. But given
cost of living, crisis inflation, just access and availability of
the illicit product, those last smokers are likely to move over.
(28:43):
It's easy to predict that the end of the legal
market for various reasons. One is obviously the excise and
people don't want to pay it. But there's also shopkeepers
who are being threatened every day, multiple people, with the
fact that they've got tens of thousands of dollars a product,
a very valuable product.
Speaker 5 (29:02):
Sitting behind their counter.
Speaker 2 (29:03):
And I certainly wouldn't want to be doing that in
a service station or a seven eleven late at night.
It's a really dangerous business to be in now, so
there's going to be less people actually want to sell
the product, and at the end of the perhaps in
a couple of years, the criminals will run the entire
tobacco market. There will be just as many people smoking,
but the government won't be getting any of the revenue.
Speaker 8 (29:25):
So there's a little talk about targeting the offshore syndicate
leaders into pole all this type of stuff, but you
catch one, the market still exists.
Speaker 2 (29:38):
Excise is the only way to address this. Really, it's
certainly a key one. The criminals are attracted by bad policy,
so all around the globe they sit there and look
for vulnerability in tax policy for a commodity at tobacco
or alcohol or anything else. They've obviously targeted. Australia has
(29:59):
been vulnerable and they're throwing all their vast resources at us,
which has overcome the ability of our law enforcement to
stop that happening. So, yes, you can lock up five
to ten of them, but the product is going to
keep coming to satisfy the market of people who actually
want this product, and that's increasing now that it's so
(30:20):
cheap as well.
Speaker 5 (30:21):
Well, that's right. I mean, I think this is a
bit like s book making. The sp bookmaker was a
friend to people in the community. They weren't going to
put him in.
Speaker 2 (30:30):
If you're buying cheap smoke from the retail around the corner,
whether it's a crook or not, you're very reluctant to
get involved and point the finger. I mean, I've got
one shop operating in my area about fifty meters from
a police station and they're happy as larry.
Speaker 5 (30:45):
So I mean, in an.
Speaker 2 (30:46):
Already stretched police force in the States, you can't see
the resources. I mean, Victoria can't get enough officers to
do the basic stuff now, let alone take on a
whole nother gangland war if you like.
Speaker 5 (30:58):
So something has to change and it's not changing. No, no,
it's not.
Speaker 2 (31:03):
And the Victoria place rather be doing one of the
multiple other responsibilities they have. But as you say, the
government occasionally brings out that argument about do you realize
what you're doing. You're just promoting organized crime and making
them stronger. But that has zero effect on your average
consumer who just sees a ten dollars product and a
(31:25):
fifty dollars product and says it's a no brainer. So
I mean, even though Australians are generally laura abiding, there
is a limit to the faith, I guess, and the
trust they have in government policy. And when that faith
is broken, which it obviously is now, then people will
have no qualms about breaking the law or moving to
(31:46):
the illegal product. And they're doing that in droves, and yeah,
that trust, if you like, and even their reliance on
the product itself. You know, they're happy with a certain
brand that they might have had for ten or twenty years.
That's broken as well, and now it's just all downhill. Really,
that's right, because I mean talk about a safe smoking product.
(32:07):
I mean, tobacco is bad for you, whether it's good
quality or bad quality, and people will buy it as
long as it's got nicotine and you know it doesn't
make you sick as soon as you smoke it.
Speaker 5 (32:16):
So I think a hiding to nothing, Roan.
Speaker 2 (32:18):
I hope we aren't having this conversation in two or
three years time when the legal tobacco is now sponsoring
the footy or something.
Speaker 5 (32:27):
Yes, no, I think they've had that.
Speaker 2 (32:29):
We're not going to reverse our policy to that extent,
but I'm not really sure what it's going to take
for the government to wake up that the policy has failed.
So you know, there's murders, there's innocent victims, there's shopkeepers destroyed,
there's no revenue, there's tobacco smoking rates going up. Yeah.
I just don't know how bad it has to get
(32:51):
before the government says, oh, okay, we might have got
this wrong and reverse some of these policies. But my
experiences was the Gangland War down here in Victoria and
the proliferation of party drugs back then. We really haven't
seen advances in UG reform to address the demand for
these product That's where it begins. And so I can
see the same thing rolling through again that the governments
(33:13):
are unlucky to reform these deeply entrenched policies. Like you say,
I mean the fact that the Health Department, for God's sakes,
is in charge of this. This should be under justice,
it should be under the border agencies, but it's not.
I mean, how do we get that simple change to
get the right public bodies to be enforcing it.
Speaker 5 (33:33):
I don't know.
Speaker 2 (33:34):
We've had multiple federal inquiries that have all said the
same thing, that the Home Affairs Department or law enforcement
agencies should be running the show. This is an organized
crime problem which is clearly out of the remit of
the health department, and yet health departments still are running
the show. So we should just thank them for creating
(33:54):
a problem, and then they need to stand aside and
let the groin ups into the room and to try
to fix this. Unfortunately, fixing it includes changing the policy
that health started, and they're highly reluctant to do so.
Speaker 5 (34:08):
They certainly are.
Speaker 2 (34:09):
And I can't see you going back into the fray
row and you'd be better off on the sideline at
this stage.
Speaker 5 (34:12):
So thanks for your time today, my pleasure. Thank you.
That's right on park.
Speaker 2 (34:19):
Former Australian Federal Police and Border Force run the Tobacco
Strike Team Thinca's issue here, of course, is our tax system.
We don't get our richest people to pay their fair
share of tax, so traditionally the burden has fallen on
the sinners, the drinkers, the smokers, the betters, this sort
of thing. So, as Rowan says, until we get a
change in emphasis, look at excise, we're just going to
(34:41):
be playing catch up here and all the coppers in
the world and all the show and tells and all
the siegures will make no difference whatsoever, because, as I
said of the outset, you can prohibit something, but you
can't make it unpopular.
Speaker 5 (34:53):
Are you buying illegal smokes?
Speaker 2 (34:54):
Let me know in the comments, or you can also
send me an email Adam Shanner writer at gmail dot com.
If you happen to want to point the finger, can
always call crime stoppers two one and out of Triple three,
Triple zero. I'm not sure many people are doing that though,
but thankfully this has been al and chan for real
crime
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