Illegal tobacco is about more than just untaxed cigarettes — it’s about funding organized crime. Every carton of contraband cigarettes sold in Canada puts money directly into the pockets of gangs involved in guns, drugs, and human trafficking. More than 150 organized crime groups are now tied to this trade nationwide.
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The recent Lloydminster RCMP seizure of 8.8 million illegal cigarettes, delivering a $7.65-million hit to the illegal tobacco market, is a stark reminder of just how profitable this trade has become. And it’s Albertans who are paying the price. According to an October 2024 EY study, in 2023 alone, provincial tobacco tax losses in Alberta may have exceeded $102 million. Between 2021 and 2023, the sellers of illegal cigarettes are estimated to have pocketed more than $1.3 billion in gross revenue.
These aren’t isolated numbers. They’re part of a much larger, deeply entrenched criminal economy. And the evidence is piling up in Alberta.
Here’s a snapshot of what police have uncovered in a series of major busts over the past three months: Westlock (Sept. 27): cocaine, meth, codeine, gabapentin, weapons, stolen tools, and 5,200 contraband cigarettes. Red Deer (Sept. 19): meth, cocaine, LSD tablets, illicit pills, 119 cartons of illegal tobacco, and thousands in crime proceeds. Cold Lake (Oct. 21): seven guns, 5,000 rounds of ammunition, stolen vehicles and trailers, and thousands of illegal cigarettes. Grande Prairie (Oct. 21): fentanyl, meth, contraband tobacco, stolen property and prohibited magazines.
Illegal cigarettes are consistently showing up alongside guns, hard drugs, stolen goods, and prohibited weapons. That’s because contraband tobacco is one of the easiest, most lucrative, and lowest-risk revenue streams organized crime has at its disposal. It fuels everything else they do.
Thankfully, the Government of Alberta is emerging as a national leader in the fight against contraband tobacco and organized crime. Recent legislative action and strong enforcement efforts demonstrate a real commitment to tackling this issue head-on. But more must be done. The Government of Canada needs to step up and lead the development of a co-ordinated national strategy to combat contraband tobacco. Organized crime doesn’t stop at provincial borders, and neither should our enforcement response.
As someone who spent decades combating organized crime, including as Deputy Commissioner of Investigations and Organized Crime for the Ontario Provincial Police, I’ve seen exactly how these networks operate. Today, as executive director of the National Coalition Against Contraband Tobacco, I can say unequivocally that Alberta, and Canada, is facing a rapidly escalating problem, and these seizures are only the tip of the iceberg.
Illegal tobacco is not a small or victimless issue. It is a major threat to public safety, to taxpayers, and to the integrity of our legal businesses.
– Rick Barnum, executive director, National Coalition Against Contraband Tobacco
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