Marin Kurti

The illegal cigarette market in a socioeconomically deprived inner-city area: the case of the South Bronx

Objective To determine the scope of the cigarette black market in a socioeconomically deprived inner-city area in the US, taking the South Bronx in New York City as a case study. Design The South Bronx Litter Pack Survey collected discarded cigarette packs (n=497) along 30 randomised census tracts to quantify the prevalence of counterfeit, legal and out-of-state tax stamps. Results It was found that 76.2% of cigarette packs collected avoided the combined New York City and State tax. More specifically, 57.9% were untaxed (counterfeit or bearing no tax stamp), for 15.8% taxes were paid outside of New York City (including other states and New York State only). Only 19.4% of tax stamps collected indicated that New York City and New York State taxes were paid. 4.4% of the cigarette packs could not be analysed because the tax stamps were not discernible. The finding that the majority of cigarettes did not have a tax stamp or bore a counterfeit tax stamp suggests that these cigarettes were being bootlegged, most likely from Native American Reservations. Conclusions The present study highlights the importance of examining the illegal cigarette market in socioeconomically deprived regions of the US, where tax avoidance and black market activities appear to far exceed levels found elsewhere in the country including Chicago and New York City at large.

Investigation of lead and cadmium in counterfeit cigarettes seized in the United States

Information of toxic elements such as lead (Pb) and cadmium (Cd) in counterfeit cigarettes offers insight on the potential public health impact of consuming counterfeit cigarettes and the technology used by counterfeiters in the illicit cigarette trade. In this study, the concentration of Pb and Cd in twenty-three packs of counterfeit cigarettes seized in the US by various law enforcement agencies were evaluated and compared with their genuine equivalents using microwave digestion followed by inductively coupled plasma - mass spectrometry (ICP-MS) analysis. Both Pb and Cd concentration in counterfeit cigarettes were markedly higher than those in their genuine equivalents, and exhibited greater sample to sample variability. The average Pb and Cd mass fraction values in counterfeit cigarettes were (5.13 ± 2.50) mg/kg (n = 23) and (5.13 ± 1.95) mg/kg (n = 23) respectively, compared with (0.59 ± 0.08) mg/kg (n = 9) and (1.08 ± 0.08) mg/kg (n = 9) respectively in the genuine equivalents. Results suggest that counterfeit cigarettes may impose higher risks to public health. Studying these toxic elements could provide important information regarding the illicit trade, including the level of organization among counterfeiters, who broker between availability of supplies and consumer demand for a cheaper product that is assumed to be genuine.

The Intended and Unintended Consequences of a Legal Measure to Cut the Flow of Illegal Cigarettes Into New York City: The Case of the South Bronx

OBJECTIVES We examined the impact of a change in New York tax law on the numbers of untaxed cigarettes bootlegged from Native American reservations and resold in the South Bronx. METHODS Discarded cigarette packs were systematically collected in 30 randomized South Bronx census tracks before and after the amended tax law went into effect in 2011. Also, administrative data were gathered on the number of taxed cigarettes sold in New York State, including sales to Native American reservations. RESULTS Before the tax amendment, 42% of discarded cigarette packs collected in the South Bronx had no tax stamp. After the tax law went into effect, the percentage of cigarette packs without tax stamps declined to 6.2%. Simultaneously, the percentage of packs with out-of-state tax stamps rose from 18.3% to 66.3%. The percentage of packs with a combined New York State and New York City tax stamp did not change after the tax amendment. CONCLUSIONS After the tax amendment, the supply of contraband cigarettes appears to have quickly shifted from one lower-priced jurisdiction to another without a change in the overall prevalence of contraband cigarettes.

The changing role of china in the global illegal cigarette trade

This study explores the history of the illegal production, distribution, and smuggling of cigarettes in mainland China. Data were obtained from a content analysis of 931 media reports retrieved from LexisNexis for the time period 1975 until 2010, and from other open sources. The illegal cigarette trade first emerged in the form of violations of state tobacco monopoly regulations. In the course of the restructuring of the legal tobacco sector, which occurred under external political pressure to open the Chinese market to foreign competition, an illegal cigarette industry emerged which at first primarily produced fake Chinese brand cigarettes for the domestic black market. At the same time, China became a destination country for smuggled genuine Western brand cigarettes. It was only after effective crackdowns against cigarette smuggling and domestic distribution channels in the late 1990s that the Chinese illegal cigarette industry shifted to exporting large numbers of counterfeit Western brand cigarettes to black markets abroad. China’s current role as a leading supplier of counterfeit cigarettes is a result of the contradictions of the economic reform process and of external licit and illicit forces that worked toward opening up the Chinese tobacco sector to the outside world.

Identifying counterfeit cigarette packs using ultraviolet irradiation and light microscopy

Objectives Develop a method that yields high rates of sensitivity and specificity for determination of counterfeit cigarette packs for three popular brands: Newport, Marlboro (‘Red’) and Marlboro Gold. Methods Using systematic keyword searches, we identified industry documents from the University of California, San Franciscos Legacy Tobacco Documents Library that describe the use of ultraviolet (UV) irradiation and close examination of printing quality to distinguish between counterfeit and genuine cigarette packs. Guided by these documents, we identified six markers for counterfeit cigarettes across three popular brands using counterfeit cigarette packs (N=68) seized by law enforcement agencies in the USA. We assessed the diagnostic test accuracy of these markers and tested it against genuine packs (N=22) using receiver operating characteristic curves analysis. Results We find that counterfeit cigarette packs fluoresce to long-wave UV irradiation and display poor printing quality. The optimal cut-off value varies among the three brands. For example, counterfeit Newport and Marlboro packaging can be reliably classified with two of six characteristics, while Marlboro Gold requires four. Conclusions Researchers who conduct littered pack and pack swap studies are urged to include this method to assess the share of counterfeit cigarettes, and compare the result against tobacco industry figures.

Spring Breaks and Cigarette Tax Noncompliance: Evidence From a New York City College Sample

OBJECTIVE Estimate cigarette tax noncompliance (tax avoidance and evasion) before and after mid-semester recesses in a New York City college campus, where the majority of students are residents of nearby lower-tax states, using data derived from garbology, an archaeological method that reconstructs patterns of human behavior from discarded materials. DESIGN We systematically divided the college campus into four geographic areas and established a total of 12 transects (survey lines) and five quadrats (survey spheres) in those areas to encompass 74 outdoor trash cans. Weekly collections of discarded cigarette packs (n = 174) in the four areas during Spring 2012 and 2013 were conducted to quantify the percentage of cigarette packs that were tax noncompliant. RESULTS Overall, we find that 72.4% of the cigarette packs collected in Spring 2012 and 2013 did not bear the required joint New York City and New York State tax stamp. Additionally, we find that cigarette tax avoidance significantly increased after recesses (mid-March and early April) in Spring 2012 and subsequently declined. We also find that packs with a Virginia tax stamp became more prevalent as time elapsed after each recess. CONCLUSION College students practice tax avoidance, drawing on legal purchases from their own home states as the primary source of cheap cigarettes. As stocks decline, some students shift to tax evasion by illegally purchasing cigarettes in New York City that have been bootlegged from low tax states (eg, Virginia). IMPLICATIONS Our study adds to the growing literature on cigarette tax noncompliance (ie, tax avoidance and evasion). First, we provide evidence that college students in our New York City sample avoid the payment of taxes in high tax states by purchasing low taxed cigarettes in their home state. Second, we find that once those sources are depleted, students find access to the black market nearby campus. This black market functions through cigarette tax evasion: the resale of cigarettes purchased in low tax states. Our study suggests that institutions of higher education operating in states with high cigarette taxes and a student body that resides in lower tax states should increase cessation services prior to breaks to discourage bulk purchases of cheap cigarettes.

“I Wouldn’t Take My Chances on the Street” Navigating Illegal Cigarette Purchases in the South Bronx

Objectives: This article examines the decision-making of consumers of illegal goods and services, using the illegal cigarette market in the South Bronx as a case study. Methods: Sixty-seven adult smokers residing in the South Bronx (New York City) were purposively recruited and placed into 13 focus groups stratified by gender and age to discuss their purchasing patterns of cigarettes. Results: Our participants routinely buy and consume illicit cigarettes. They prefer to purchase these illicit cigarettes in legitimate stores rather than from street vendors. In their decision-making, our participants are guided by various concerns, including reliable access to illicit cigarettes, minimal exposure to the police, the ability to purchase cigarettes on credit, reduced risk of being sold low-quality cigarettes (i.e., stale, counterfeit), and the chance to successfully complain in case of poor product quality. Conclusions: Consumers make rational decisions to purchase illicit cigarettes within the constraints they face as a result of their socioeconomic position. They base their decisions on a set of factors of which the lowest retail price is not a primary concern.

Innovations in counterfeiting tax stamps: a study of ultraviolet watermarks in a sample of discarded New York City packs

Objective Document the use of ultraviolet watermark in counterfeit joint New York City/New York State cigarette tax stamps to assess the scale at which distributors of illegal cigarettes adapt to measures protecting the integrity of the system of tobacco tax collection. Methods In 2016, we collected 2357 empty discarded cigarette packs along a stratified random sample of block groups in New York City (n=114) and analysed 449 joint New York City/New York State tax stamps using long wave ultraviolet irradiation, light microscopy and taggant testers developed by the tax stamp manufacturer, Meyercord Revenue, to determine whether the tax stamps were counterfeit and how they differed from their genuine equivalent. Findings 23% (n=102) of the joint NYC/NYS tax stamps examined were counterfeit. Subsequent investigation revealed that almost two-thirds (n=58) of the counterfeit sample bore ultraviolet watermark that closely resembled genuine tax stamps in terms of fluorescence, watermark colour and wording. However, microscopic findings revealed that counterfeit tax stamps mismatched the genuine ultraviolet watermark in regards to font style and word orientation. Conclusion Counterfeiters are using ultraviolet watermarks which makes it difficult to differentiate counterfeit joint New York City/New York State tax stamps from their genuine equivalent when UV irradiation is used as the sole screening tool. Innovations in counterfeiting technology may be the result of fluorescent ink being available for purchase in the mainstream market. Independent monitoring of trends in the illicit market for tobacco products is advised to keep apace of counterfeiting methods.

“I'm gonna get me a loosie” Understanding single cigarette purchases by adult smokers in a disadvantaged section of New York City

This study seeks to update and expand our understanding of the perceptions and purchasing patterns of smokers of single cigarettes (‘loosies’) in disadvantaged urban areas. Semi-structured guides were used in thirteen focus groups with 67 self-identified adult smokers from the South Bronx section of New York City in summer 2013. There is wide availability of single cigarettes in the South Bronx, with legitimate stores overwhelmingly being the preferred venue for purchases. Single cigarettes are sold at higher per-unit prices than illicit packs. However, buyers of single cigarettes can achieve cost savings compared to legal, fully taxed cigarette packs. Apart from cost-savings, smokers opt for single cigarettes to reduce their personal cigarette consumption. There is a general perception of market resilience despite law enforcement intervention. However, law enforcement has a limiting effect on access to single cigarettes outside of an individual smokers immediate neighborhood. The findings suggest that single cigarette sales are an important element of the illicit cigarette market in disadvantaged communities which should not be ignored in future research on the nature and extent of cigarette tax avoidance and evasion.

Presence of Counterfeit Marlboro Gold Packs in Licensed Retail Stores in New York City: Evidence From Test Purchases

Background There are no independent studies measuring the availability of premium brand counterfeit cigarettes in New York City from licensed retailers. Methods We forensically analyzed the cigarette packaging of Marlboro Gold (n = 1021) purchased from licensed tobacco retailers in New York City, using ultraviolet irradiation and light microscopy to determine whether they were counterfeit. Results We find that while only 0.5% (n = 5) of our sample exhibits at least one characteristic synonymous with counterfeit packaging, none of our packs can be conclusively classified as counterfeit. Conclusions We do not find any counterfeit Marlboro Gold packs purchased at full price from licensed cigarette retailers throughout New York City. Future research using test purchases should include other venues (eg, street and online) and specifically ask for discounts to ascertain the overall presence of counterfeit cigarettes. Implications This is the first study to independently measure the availability of counterfeit cigarette packs purchased at full price from licensed retailers in New York City. We find that none of the Marlboro Gold packs purchased from licensed cigarette retailers are counterfeit.