- The Washington Times - Monday, September 23, 2002

Maryland is setting a record pace for tobacco-smuggling arrests, having charged 42 persons with the crime since the fiscal year began July 1.
According to figures provided by the Office of the Comptroller, 74 persons were charged with tobacco smuggling last fiscal year, which was a state record. If the state maintains its pace, it could see as many as 160 tobacco-smuggling arrests by June 30, the end of the fiscal year.
The increased pace of arrests coincides with an increase in Maryland's tobacco tax. Since June 1, cigarettes have been taxed $1 per pack, up from 66 cents per pack, and comptroller agents have arrested 42 persons on tobacco-smuggling charges. Among those charged were 34 Maryland residents and businesses.
"We expected more smuggling attempts when the cigarette tax increased to $1 on June 1, so we stepped up our enforcement efforts," Comptroller William Donald Schaefer said in a press release. "If you're going to smuggle cigarettes into our state, be prepared to get caught and pay the price."
The state's tobacco-control law allows smokers to bring two packs of cigarettes into the state per trip. Smokers seeking to beat the tax by obtaining cigarettes out of state face stiff penalties.
Possessing untaxed cigarettes is a misdemeanor that carries a one-year jail sentence and/or a $1,000 fine. Transporting untaxed cigarettes into the state is a felony that carries a two-year jail sentence and/or a $50-per-carton fine.
Maryland's cigarette tax is the fifth-highest in the nation, behind New York and New Jersey at $1.50 per pack, Washington state at $1.42 per pack and Connecticut at $1.11 per pack. Maryland shares the ranking with Rhode Island, Maine, Alaska and Hawaii, which also levy $1 per pack.
The cigarette tax in Virginia is 2 cents per pack, the nation's lowest. In the District, it is 65 cents per pack.
Confiscated cigarettes, which are sold at auctions, have put $1 million into the state's general fund in the past three years. The $1 cigarette tax is expected to generate $101.4 million in general-fund revenue this fiscal year.
Meanwhile, Mr. Schaefer is seeking to add two agents to his department, which enforces tax and license laws. Thirteen of 22 comptroller agents specialize in enforcing tobacco licenses and taxes, although they also must sometimes enforce liquor, manufacturing and business licenses, said spokesman Michael D. Golden.
The agents follow tips, monitor Virginia tobacco warehouses and auctions, and patrol the Maryland border for smugglers.
The comptroller has linked tobacco smuggling to terrorist groups. "We know that some of the money used by smugglers is directly passed on to terrorist organizations," Mr. Schaefer said last month.
Three weeks after the September 11 terrorist attacks on the World Trade Center and the Pentagon, Mr. Schaefer said he believed there was some connection between cigarette smugglers and terrorist groups.
He said the terrorists who bombed the World Trade Center in 1993 had sold cigarettes illegally to partially finance that attack.
"As far as we're concerned, that's still the case," Mr. Golden said.
In October, Mr. Schaefer gave the FBI the names of 212 persons his agents suspected of smuggling cigarettes to fund terrorist activities. Most of those people had been arrested in Maryland on tobacco-smuggling charges.
At that time, most people charged with cigarette smuggling had Middle Eastern backgrounds, said Mr. Golden.
Earlier this month, agents arrested New York residents William Wong, 25, and May Chee Yu, 24, and charged them with cigarette smuggling. They were traveling in a 1995 Lexus on Route 495 near Route 4 in Prince George's County when agents stopped them.
Agents confiscated 986 packs of untaxed cigarettes valued at $3,879. The two were charged with possessing and transporting untaxed cigarettes.
In June, a Miami jury convicted a Charlotte, N.C., man of financing suspected Hezbollah terrorists in Lebanon with profits from a multimillion dollar cigarette smuggling operation that he ran with his brother.


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