Illegal Tobacco Growing Operation Ploughed into the Ground

Australian Border Force, Australian Criminal Intelligence Commission, Australian Taxation Office, Australian Transactions and Reporting Analysis Centre (AUSTRAC), Commonwealth Director of Public Prosecutions, Department of Home Affairs

The Australian Border Force (ABF) led Illicit Tobacco Taskforce (ITTF) has disrupted a major criminal operation involved in the domestic growing of illicit tobacco.

On Saturday, 21 March 2020, the ITTF seized and destroyed approximately 10 acres of illegal tobacco crops with a potential excise value of more than $7 million from a property in Peelwood New South Wales.

Under ITTF Operation CARPO, the Australian Taxation Office (ATO) and ABF officers, with support from NSW Police Force executed a number of warrants at the property.

Along with the tobacco crop, also located on the property was industrial equipment used in the growing and manufacturing of illicit tobacco including two water pumps, a diesel fuel tank, generator, kiln, double bailing machine, greenhouse and numerous sheds. The possession of equipment for use in the illegal manufacture or production of tobacco is a new offence under the Taxation Administration Act 1953, introduced by the Australian Government in 2018.

Growing tobacco in Australia is illegal; the ATO have not issued a license for a tobacco producer to grow crop since 2006. 

ATO Assistant Commissioner Ian Read said the ATO estimates that illicit tobacco costs the Australian community $647 million in lost revenue each year.

“The trade in illicit tobacco products in Australia deprives the community of tax revenue that is required to fund essential community services such as hospitals, roads and schools, as well as funding other organised criminal activity,” Mr Read said.

The illegal growing of tobacco in Australia usually involves the illegal sourcing of water, which undermines legitimate farmers and Government sustainability measures, especially in times of drought. In this case, two illegal dams were located on the property. The ITTF are working with the NSW Water Enforcement Taskforce on potential prosecution options for illegal dams.

ITTF Superintendent Leo Lahey said the operation should send a clear message to those involved in Australia’s illicit tobacco trade.

“By working closely with the ATO and other ITTF partners, we are able to leverage each agency’s operational powers and resources to disrupt this illicit activity on multiple fronts,” Superintendent Lahey said.

“Whether it be seizing tobacco at the border or destroying domestic crops, we are making a significant impact on the illicit tobacco supply in Australia and the criminal groups involved.”

NSW Police Force Criminal Groups Squad Commander, Detective Superintendent Rob Critchlow, said investigations into the activities of the criminal network responsible for the crop are continuing.

“Criminal Groups Squad detectives are working closely with other Commonwealth agencies to target those involved in the importation and cultivation of tobacco,” Det Supt Critchlow said.

“We know from experience that the trade in illicit tobacco products have widespread effects on the communities of NSW and the profits are often used in other organised criminal activity.”

The ITTF is an ABF-led multi-agency taskforce that combines the operational, investigative and intelligence capabilities of the ABF, ATO, Department of Home Affairs, Australian Criminal Intelligence Commission (ACIC), Australian Transaction Reports and Analysis Centre (AUSTRAC) and Commonwealth Director of Public Prosecutions (CDPP).

The ITTF also works very closely with state and territory law enforcement agencies.