A multi-million scheme of illegal cigarettes sale, "covered" by tax authorities, is exposed by the SBI (VIDEO)

As part of systematic efforts to combat corruption among officials, SBI officers, with the assistance of the leadership of the State Tax Service, uncovered a large-scale illegal cigarette sales scheme operating throughout Ukraine. The scheme involved regional tax officials who covered up the illegal business.

The criminals began their illegal activities in the second half of 2002. Organisers from Odesa were in charge of the illegal tobacco sales scheme. The network was most active in the Odesa and Vinnytsia regions.

In Vinnytsia alone, there were 27 outlets selling counterfeit cigarettes with a fake "duty free" label. Monthly sales of cigarettes in this region alone amounted to tens of millions of hryvnias, with budgets at various levels losing millions in taxes.

Law enforcement agencies undertook around fifty searches in the Vinnytsia and Odesa regions. Investigations were carried out at the points of sale of excise goods, at the offices of the organisers, at the residences of persons who may have been involved in the illegal scheme, and at the headquarters of the State Tax Service in the Vinnytsia region.

The searches resulted in the detection and confiscation of more than 100,000 packs of cigarettes worth over UAH 5 million, almost UAH 1.5 million in cash, documents proving the poor quality of inspections of tobacco outlets, black books, communication equipment and media.

The SBI officers served a notice of suspicion to the "head" of the counterfeit sale in Vinnytsia region of illegal purchase, storage, sale and transportation with intent to sell illegally manufactured tobacco products committed by a group of persons (Part 2 Article 28, Part 1 Article 204 of the Criminal Code of Ukraine). The issue of selecting a type of detention is being decided.

Law enforcers are investigating the entire chain of the illegal business, identifying the organisers of the scheme and local executors, checking the origin of excisable goods.

In addition, a pre-trial investigation is being carried out into the abuse of power or office that caused grave consequences (part 2 of Article 364 of the Criminal Code of Ukraine).

Tax officials in several regions may face up to 6 years in prison.

The Vinnytsia Regional Prosecutor's Office is in charge of the proceedings.