In a combined operation of the Tax Agency and the National Police, with the collaboration of the Interior Ministry of Bulgaria

• A criminal organisation has been dismantled that secretly transported tobacco leaves and machinery from Bulgaria to Spain to carry out illegal manufacture in our country
• In the operation 22 people were arrested, 20 of Bulgarian nationality and two of Spanish nationality
• In addition to the confiscated tobacco, which includes 260,656 packs of tobacco valued at 7,100,000 euros, various machinery was seized for all the production process, packaging and health messages for different countries
• Once in our country, three premises in the provinces of Málaga, Toledo and Salamanca were used as authentic factories equipped with the industrial machinery necessary for the production of cigarettes and packs of tobacco
• The organisation had turned three premises into bubbles isolated from the exterior, and its workers spent the night in them in order not to be detected

 

July 11, 2016.- A joint operation by the Tax Agency and the National Police, with the collaboration of the Ministry of the Interior of Bulgaria, has led to the dismantling of three clandestine cigarette factories and the seizure of 39 tons of chopped tobacco that was supposedly going to be distributed in Spain. An organisation has been disarticulated, with 22 arrests (twelve in Toledo, nine in Málaga and one in Salamanca), that secretly transported the bulk tobacco in lorries from Bulgaria to Spain.

Once in our country, they used three premises in the provinces of Málaga, Toledo and Salamanca equipped as authentic factories with industrial machinery in which they manufactured cigarettes and packed them for illegal distribution.

The three industrial premises had machinery for manufacturing and packaging cigarettes which had been transported from Bulgaria and whose value is approximately a million euros. In addition, they were equipped so that the activity carried out was undetectable from the exterior, in such a way that the members of the organisation performed their criminal activity in them and lived there with no contact with the exterior. Production “campaigns” would be carried out in them every two months, approximately.

 

Information from Bulgaria

In mid-October 2014, the National Police received information from the Directorate General of the Organised Fight against Crime of the Interior Ministry of Bulgaria on the existence of an organized group of Bulgarian origin settled in Spain. The Bulgarian authorities warned that the members of this group could be carrying out activities that could constitute offences of contraband, against industrial property, money laundering, membership of a criminal organisation and against the Public Treasury. The members of the organisation allegedly travelled from Bulgaria to our country with the aim of establishing factories to produce illegal cigarettes, and also to create a distribution network of this product, both national and international.

The leader of the organisation directed it from Bulgaria. This person allegedly created a criminal network with the following functions:

1.- Transportation of concealed bulk tobacco from Bulgaria to Spain, using lorries of his own company.

2.- Use of industrial premises in Spain for storing bulk tobacco and the assembly of factories dedicated to transforming this tobacco into cigarettes, for subsequent sale in packets.

3.- Distribution of the manufactured cigarettes in Spain, made from the bulk tobacco brought from Bulgaria.

The final operation carried out in the three industrial premises led to the arrest of 22 people and the seizure of a total of 39 tons of chopped tobacco, 260,656 packs of cigarettes, 207,000 cigarettes (unpacked), materials for packaging with various messages, suitable machinery for adding tobacco, chopping it and introducing it via the hopper into a drum where other ingredients were added, tobacco rolling machines, wrapping machines and cardboard boxes.

 

Covered windows and frequency inhibitors

The three premises were perfectly equipped with rooms for accommodating the organisation's workers (beds, lavatories, showers) and a common area with a kitchen and dining room. The organisation's workers lived in the interior of the premises in total secrecy while the “campaign” lasted, with the doors closed on the outside with security locks, the windows completely covered, and the Toledo premises even had inhibitors of mobile phone signals to prevent the workers from communicating with the exterior.

Three premises had soundproofing systems to prevent the noise of the machines, extractors and generators from being detected in the exterior, with cooling and smoke extraction systems so that the workers would not breathe in the particles generated in the production of the cigarettes, since the windows were also covered and soundproofed. The rubbish and waste generated by the production system were stored in large boxes and piled up on pallets while awaiting pickup by one of the lorries used by the organisation. Both inside and outside the premises there were security cameras connected in network, ensuring that the pictures were not registered in any storage system.

 

Production capacity

The cigarette production capacity in each of the three factories is estimated at more than 11,000,000 cigarettes a week. The fraud on the Special Tax on Tobacco Products and VAT for the seixed tobacco and packs, valued at 7,100,000 euros, amounts to more than 5,700,000 euros.

The final operation conducted simultaneously in the three industrial premises led to the arrest of 22 people and the seizure of a total of 39 tons of chopped tobacco, 260,656 packets of cigarettes, 207,000 unpacked cigarettes, materials for packaging with different messages, machinery for adding and chopping tobacco and introducing it via the hopper into a drum where other ingredients were added, rolling and packaging machines and cardboard boxes.

 

One of the largest activities against secret tobacco factories in Europe

In Spain, the illegal manufacture of cigarettes in fixed industrial facilities together with the handcrafted production of cigarettes - that is, the illegal trade in tobacco leaf oriented to retail distribution - are the types of contraband that currently have the greatest negative impact on the collection of the Tobacco Products Tax, if consideration is given to the data signified by the actions carried out once the tons of seized leaf have been transformed into the possible production of illegal cigarettes (at a ratio of one gram per cigarette). Since 2015, a total of 500 tons of tobacco prepared for the industrial or handcrafted production of cigarettes have been seized, which signifies the prevention of a tax fraud of around 80 million euros.

In addition to the detriment to the collection of indirect taxes, VAT and Excise Duties, and direct taxes, both the illegal manufacture and the illegal sale of tobacco leaf aimed at consumers for production of cigarettes has other added impacts, since the processes are performed in secret without taking into account standards of quality control or hygiene in the handling or storage of the product, with no guarantees that the mix does not include other harmful products, etc.)

The illegal manufacture of cigarettes is a fraud that has spread all around the EU, signifying enormous losses in the national budgets and of the European Union. From 2005 to date, more than 150 illegal factories installed in the European Union have been dismantled, mostly in Eastern European countries.

The operation was carried out jointly by the Tax Agency and the National Police, with the participation in the case of the Tax Agency of officials of the central services of the Sub-Directorate of Customs Surveillance of the Tax Agency's Department of Customs and Excise Duties, and of the Customs Surveillance units of Madrid, Salamanca and Malaga; and, on the part of the National Police, agents of the Headquarters of the Criminal Investigation Department and of the Costa del Sol UDYCO (Drugs and Organised Crime Unit) of Malaga, the Technical Interventions Task Force (GOIT), the GOES (Special Security Task Force) of Malaga and the UPRs (Prevention and Reaction Units) of Salamanca and Toledo.