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Authorities have estimated the haul is worth almost $9 million in lost tax receipts.
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Police seize $12m in tobacco after joint operation with ATO
02 July 2024
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Police have seized over $12 million in illegal tobacco from two properties in eastern Victoria as part of a joint operation with the ATO.
The operation, known as Taskforce Lunar, raided a remote Arcadia property and a residential address in Undera, uncovering almost 7 tonnes of tobacco.
The tobacco crop seized on the Arcadia address on 26 March was worth a total avoided excise value of almost $9 million, and was destroyed by Victoria police under seizure provisions of the Excise Act.
At the Undera address, police found two large kilns, which they will allege were used to dry the illicit tobacco, along with almost two tonnes of product worth more than $3.5 million.
Five improperly stored firearms were also seized. A 73-year-old man was served with a notice of suspension and a proposal to cancel a firearms licence but the detectives did not believe he was connected to the tobacco investigation.
On 17 June, three warrants were executed by Western Australia Police, with the assistance of the VIPER organised crime taskforce, at properties allegedly linked to a significant leader of an organised crime syndicate involved in the same illicit tobacco network.
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Approximately 50,000 illicit tobacco sticks, 30kg of loose-leaf tobacco, vapes and a CCTV system were seized from two properties in Werribee– one residential address and one tobacco store.
Mobile phones were also seized from a residential address in Altona Meadows.
A 36-year-old Werribee man, believed to be the Werribee store’s owner, was interviewed on 26 June in relation to possessing and producing illicit tobacco. He was expected to be charged on summons, police said.
ATO assistant commissioner Jade Hawkins said engaging in the illicit tobacco trade was a serious offence and far from a victimless crime.
“These crimes are calculated, deliberate, and take vital funding from essential community services such as healthcare and education,” she said.
“Illicit tobacco retailers gain an unfair price advantage over honest businesses who do the right thing. Removing illegal tobacco from crop to the shop creates a level playing field for those small businesses.”
The ATO calculates the tobacco tax gap – the excise revenue lost due to illicit tobacco imports and cultivation – at $1.89 billion, or more than 10 per cent of the excise it calculates should be collected.
Mark Hatt, Victoria Police’s detective acting superintendent, said authorities were committed to doing everything they could to “deter, disrupt and dismantle” criminal syndicates.
“These seizures – and their potential value in avoided excise – are significant, and their impact will no doubt be felt by the organised crime groups operating in Victoria. They will also provide further avenues of enquiry for Victoria Police,” he said.
“We have made it absolutely clear that we will target anyone at any level across the state who is involved in the distribution and sale of illicit tobacco, and that involves regional Victoria.”
It comes as the government established the role of an illicit tobacco and e-cigarette commissioner on Monday to “ramp up the fight against black market nicotine products”.
Australian Border Force Assistant Commissioner Erin Dale would assume the role on an interim basis until a formal appointment was made, the government said.
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