Category: Illicit Trade

  • FDA, CBP Seize Over $719,000 of Illegal Vapor Products

    FDA, CBP Seize Over $719,000 of Illegal Vapor Products

    U.S. Customs and Border Protection (CBP)  officers at the Dallas Fort Worth International Airport working in conjunction with agents from the U.S. Food and Drug Administration (FDA) have seized 33,681 units of e-cigarettes with a manufacturer’s suggested retail price of $719,453.

    taking e-cigarettes
    Credit: SFGate

    In December 2020, CBP seized 42 separate shipments arriving from China destined to various Texas counties. The shipments included individual disposable flavored e-cigarette cartridges resembling the Puff Bar brand, including Puff XXL and Puff Flow.

    As part of an ongoing joint operation with FDA, officers and agents were looking to intercept counterfeit or other violative e-cigarettes, including certain flavored e-cigarettes imported to the U.S. that did not meet the Federal Food, Drug, and Cosmetic Act requirements, as amended by the Family Smoking Prevention and Tobacco Control Act.

    “Many counterfeit, unapproved or unauthorized products are likely produced in unregulated facilities with unverified ingredients posing a serious health concern to consumers. It is especially alarming when these types of counterfeit and unauthorized products find their way into the hands of children as studies indicate,” said CBP Port Director Timothy Lemaux in a statement. “We will continue to take every opportunity to work with our partners at the FDA to intercept and seize products that threaten U.S. consumers.”

    Tobacco products including e-cigarettes imported or offered for import into the U.S. must comply with all applicable U.S. laws.

    “The FDA continues to prioritize enforcement against e-cigarette products, specifically those most appealing and accessible to youth,” said Mitch Zeller, director of the FDA’s Center for Tobacco Products. “We are very concerned about how popular these products are with youth. This seizure makes clear to tobacco product manufacturers, retailers and importers that the FDA is keeping a close watch on the marketplace and will hold accountable those companies that violate tobacco laws and regulations.”

    CBP’s trade enforcement mission places a significant emphasis on intercepting illicit products that could harm American consumers. In fiscal year 2020, CBP seized 93,590 units of e-cigarettes that did not meet U.S. federal regulations.

    In July 2020, the FDA issued a warning letter to Cool Clouds Distribution (doing business as Puff Bar), to remove their flavored disposable e-cigarettes and youth-appealing e-liquid products from the market because they do not have the required premarket authorization.

    “Protecting American consumers from illicit and especially harmful tobacco products, such as counterfeit or flavored e-cigarettes, is of utmost importance to the FDA,” said Judy McMeekin, FDA associate commissioner for regulatory affairs. “We will continue to investigate and remove from the marketplace products that pose a particular danger to the public health.”

    While the Puff Bar website appears to have recently stopped online sales and distribution in the U.S, it does not mean that the firm ceased distributing products to other retailers or selling products at brick and mortar retail stores, according to the FDA. The website’s store locators are still active, indicating that potential consumers can still search for products located for sale at retail stores.

  • Bangkok Authorities Seize $335,000 in Illegal E-Cigarettes

    Bangkok Authorities Seize $335,000 in Illegal E-Cigarettes

    Four people have been arrested and 10 million baht worth of e-cigarettes and related items seized in Bangkok following an investigation into illegal online sales of the banned products.

    Bangkok police
    Credit Jim Moylan

     

    The arrests followed a raid by police from the Central Investigation Bureau (CIB) of a warehouse in Kheha Rom Klao Soi 27 in the Rat Phattana area of Saphan Sung district on Friday, according to the Bangkok Post.

    The officers seized 50,000 bottles of refill liquid for e-cigarettes, 10,000 refill pods, 1,500 e-cigarettes and 80 boxes of related products worth a total of at least 10 million baht ($335,814), CIB commissioner Police Lt. Gen. Torsak Sukwimol said during a briefing on Saturday.

    One woman and three men were arrested. All were charged with colluding in the sale of banned products in violation of the Consumer Protection Act.

    Torsak said the CIB had received complaints that e-cigarettes and refill products of various brands were being sold via Facebook. Administrators of the page claimed that their products were made from dried fruits and posed no harm to users.

    CIB investigators found that the Facebook page had been active for three years. Female presenters or “pretties” were hired to promote the products, which drew many purchase orders, said Torsak.

    The investigators then sought a warrant from the Criminal Court to search the warehouse that led to the seizure of the products, which were imported from China.

    Authorities said they would also call the product presenters in for questioning.

    The government passed a law banning the sale of e-cigarettes in 2014. Authorities have said import and use is banned for health reasons and because electronic cigarettes lure young people into becoming smokers.

  • New Report Highlights Opportunities for Tax Stamps

    New Report Highlights Opportunities for Tax Stamps

    Photo: Reconnaisance International

    New investment in track-and-trace systems, rising excise taxes and wider commercial applications will drive tax stamp growth in the next five years, according to a new report published by Reconnaissance International.

    The third edition of the “Tax Stamps & Traceability: A Market Analysis and Technical Update” identifies cannabis and vapor products as new markets for tax stamps to tap into at a time when the continued trade in illicit tobacco and alcohol sees revenue agencies using the devices as effective weapons in the fight against counterfeiters and criminals.

    The report also points to the fact that by 2023, tobacco products in at least 60 countries will need to have track-and-trace systems in place to comply with the World Health Organization’s (WHO) Framework Convention on Tobacco Control (FCTC) Protocol to Eliminate Illicit Trade in Tobacco Products. This could open up additional tax stamp markets and more commercial opportunity for an established product.

    Nicola Sudan

    “This is an important strategic report, offering insight, analysis and to those with a vested interest in tax stamps, the knowledge needed to progress with their own plans in this burgeoning sector,” said the report’s editor Nicola Sudan of Reconnaissance International. “Tax stamps offer a cost-effective way to secure excise revenue, while the authentication benefits provided cannot be overstated. It is why they will continue to be highly regarded and used by revenue authorities around the world well into the future.

    “So whether your country, state or jurisdiction currently uses a tax stamp scheme, or is considering investing in such a scheme, it would be beneficial to find out what a modern program can deliver and why now is the right time to introduce them or expand your current scheme. This report will aid in making the right decisions and choices.”

  • Singapore Authorities Arrest 14 for Illegal Online E-Cig Sales

    Singapore Authorities Arrest 14 for Illegal Online E-Cig Sales

    judge's gabel
    Credit: Bill Oxford

    The Singapore Health Sciences Authority (HSA) has prosecuted 14 people for selling e-cigarettes and related accessories online. According to a release from the HSA, the individuals were convicted in court between June and August 2020, with the total fines amounting to $255,500.

    Authorities say the offenders were aged between 20 and 43, and had purchased the vaping products from overseas suppliers and then sold them illegally on various local social media and e-commerce platforms.

    “These cases were detected through HSA’s cyber-surveillance and enforcement activities, which are targeted at deterring the illegal import and sale of e-vaporisers and related accessories in Singapore. More than $50,000 worth of e-vaporisers and related accessories were seized from the peddlers,” the release states. “The youngest offender, aged 20, was sentenced to a 15-month supervised probation, while the rest were fined between $5,500 – $47,500.

    From 2018 to date, HSA has prosecuted 35 persons for selling e-cigarettes and related accessories. The stiffest penalty meted out so far was $99,000 in 2019, the release states.

  • Bangkok Man Charged With Selling Illegal E-Cigarettes

    Bangkok Man Charged With Selling Illegal E-Cigarettes

    Thailand police with illegal vapor stuff
    Credit: Nation Thailand

    Over 70 various e-cigarette and vapor related products have been seized in Bangkok, Thailand after raiding the home of a 35-year-old man. Vaping products are illegal for sale in Thailand. The country banned the products in 2014.

    Police found 70 electronic cigarettes, several containers of e-liquid and other related products. Police say the alleged dealer sold the e-cigarettes and e-liquid through Facebook and used a private delivery service to ship the products to customers.

    Police tracked down the dealer’s address and searched his home, finding e-cigarettes and related products valued at around baht300,000 ($9,839), according to a report in The Thaiger.

    The accused was detained and charged with violating consumer protection regulations. Police say he admitted to selling the products.

    Earlier this year, a consumer advocacy group asked the government of Thailand to consider science as basis for ending e-cigarette ban.

  • China Cracks Down on Counterfeit Juul Maker

    China Cracks Down on Counterfeit Juul Maker

    Chinese authorities helped Juul Labs close down a manufacturer that allegedly counterfeited Juul brand vaping devices and sold the fake products overseas.

    The operation was one of the largest ever broken up by the e-cigarette maker in its efforts to crack down on potentially dangerous counterfeit products that could make their way to underage buyers, company officials say.

    According to a story in the New York Post, Shenzhen Kang Erqiang Electronic Technology Co. — which hawked bogus Juul vape devices and flavor pods under the name Sourvape Technology — sold about $324,000 worth of counterfeit items over a 16-month period starting in 2018, Juul said.

    “While these are the numbers Chinese authorities used in court during prosecution, actual sales could be far more significant,” said Adrian Punderson, Juul’s vice president of brand enforcement.

    The probe led to the August conviction of the Shenzhen factory’s operator, who confessed to his involvement in the scheme and was sentenced to more than three years in prison, Punderson said. Juul said it was informed of the conviction earlier this month.

    The operation courted e-cigarette retailers and distributors with email blasts boasting about how perfectly it could produce Juul’s packaging, according to the startup. Juul officials learned about these emails in February 2019 and started an investigation, posing as a buyer to try and identify who was behind the scheme, the company said.

    Juul reps ultimately got inside the counterfeiter’s factory in March of last year, where about 15 employees worked to churn out fake Juul products six days a week, according to the company, according to the story.

    Juul said the operation was even producing pods in flavors such as mango and cucumber, which the company stopped selling in the US last year amid concerns about teens getting hooked on its e-cigarettes.

    Juul passed on its findings to Chinese authorities, who launched their own probe and eventually seized 14,600 bogus items when they raided the factory in April 2019, according to Juul.

    Juul says its efforts to crack down on counterfeiters have led to the seizure of more than 600,000 items worth close to $4 million over the past year. The shady manufacturers — who primarily operate in China — sell their products for as much as 65 percent below Juul’s standard wholesale price, but those products could be dangerous because they’re made in unsanitary conditions without proper testing or quality control, according to the company.

    “As a leader in vapor technology, it is our obligation to support enforcement against illicit and illegal products as we strive to reset the vapor category and earn a license to operate in society,” Punderson said in a statement.

  • Indonesia Seizes 1,240 Boxes of Illegal Vaping Products

    Indonesia Seizes 1,240 Boxes of Illegal Vaping Products

    The Indonesian government is reporting it has seized 1,240 boxes of vaping devices and e-liquid worth about RM124,000 ($29,890). The products are believed to have been in the process of being smuggled to a neighbouring country. The products were discovered hidden on the banks of Sungai Golok by the 9th Battalion of the General Operations Force (PGA9).

    It is believed that the items were just waiting for the right time to be smuggled before they were confiscated, according to the star.com. PGA9 commanding officer Supt Nor Azizan Yusof said the seizure was carried out by a team patrolling the border during Ops Benteng.

    He said while inspecting the Kak Yah illegal base near Kuala Jambu, Tumpat, at about 6.30pm on Thursday, the team found three packages left on the riverbank. “The team observed for 15 minutes but no one came to claim them. All the packages were taken to PGA headquarters in Kuala Jambu for further inspection, ” he said yesterday. All the items will be handed over to the Customs Department.

  • Pennsylvania Seizes $1.7 Million in Illegal E-Cigarettes

    Pennsylvania Seizes $1.7 Million in Illegal E-Cigarettes

    Credit: Bill Oxford

    More than 86,000 unapproved vaping products, worth an estimated $1.72 million, were intercepted on the way to the Lehigh Valley in eastern Pennsylvania, the U.S. Customs and Border Protection said.

    The shipment from China arrived Sept. 18 in the United States, identified as “LED lights” and addressed to a location in Northampton County, officials said.

    Instead of lights, the shipment was actually 216 boxes of about 86,000 Alphaa Onee Plus flavored electronic cigarettes. The flavors included mojito, apple blue razz, strawberry milk, energy drink and pomegranate strawberry, according to a story on lehighvalley.com.

    CBP officers at the Port of Lehigh Valley in Allentown detained the shipment and contacted the U.S. Food and Drug Administration.

    Earlier this month, the FDA examined the e-cigarettes and determined they violated the Federal Food, Drug, and Cosmetic Act as misbranded consumer goods being imported by an unauthorized agent.

    The e-cigarettes will be destroyed.

  • Warning Against Fake Synthetic Nicotine

    Warning Against Fake Synthetic Nicotine

    Photo: Liliya623 | Dreamstime.com

    Next Generation Labs, a producer of synthetic nicotine, is advising the vape industry to be wary of recent claims by numerous Chinese manufacturers regarding the availability of synthetic nicotine for use in recreational adult vaping and other nicotine containing products.

    According to Next Generation Labs, many of these brands are potentially violating the company’s nicotine manufacturing process patent or trademarks, or are counterfeit, fake, mislabeled, or are potentially misrepresenting their synthetic base material as being “not made or derived from tobacco leaf, stem, stalk, root, flowers or waste,” when they actually are tobacco-derived.

    Over the past six years, Next Generation Labs has invested heavily in strengthening its intellectual property worldwide. In a press note, the company said it will act against any company that may violate its process patents for the manufacture of synthetic nicotine.