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RE: [cdn-nucl-l] Anti-MOX campaign continues
> Brown, Morgan[SMTP:firstname.lastname@example.org] wrote on Wednesday February 23, 2000
> 10:17 AM
> Unwilling to alow weapons plutonium to be rendered unusable, anti-MOX
> are trying the legal route ...
> In the Wed Feb 23 National Post:
> OTTAWA - Canada's plan to import weapons-grade plutonium from Russia later
> this year could soon become subject of a court challenge in the U.S.
> A Michigan environmental group, joined by six Canadian native and
> organizations, will file suit later this week to block the shipment to
> Ontario's Chalk River nuclear test facility. The shipment is part of a
> to determine if bomb material can be used as fuel in CANDU reactors.
Those Canadian native organisations also featured prominently in the
published document, Transport Canada Review of Two Emergency Response
Assistance Plans Proposed by the Atomic Energy of Canada Limited for the
Importation of up to Six Shipments of Test Samples of MOX Fuel.
I find it very interesting however, that those same native groups made
relatively little effort to block the illegal smuggling of thousands of tons
of cigarettes across the border from the US, through their territories, to
Canada. Certainly the big tobacco companies were responsible -- but none of
this could have happened without the native lands being used for illegal
purposes. Read on :
Saturday 18 December 1999
Tobacco insider talks
Major firms were deeply involved in cross-border smuggling, former executive
Feb. 24, 1999, was not a banner day for Les Thompson. Arrested by U.S.
Customs agents in the Ontario city of Windsor, cuffed and thrown into jail,
the RJR-Macdonald sales executive suddenly became the slick, hard-driving,
unscrupulous face of big tobacco.
U.S. prosecutors claimed they had nabbed the man behind a billion-dollar
tobacco-smuggling network that in the early 1990s pumped billions of
black-market cigarettes through the Akwesasne Indian reserve at Cornwall and
Alone in a concrete lockup, Thompson recalled the words of a company lawyer
nine months earlier, words spoken just after he had learned he was a target
of a police investigation: "Stand tall through this, Les. We will stand
behind you. We don't need wobbly legs here. The government is
sabre-rattling. This thing is going to go away."
Eight days after his arrest, a company-paid lawyer finally showed up at his
jail cell in Syracuse, N.Y.
"I've got good news and I've got bad news," the lawyer said. "The good news
is I'm here. The bad news is the company will not support a trial."
The company Thompson had served for so many years, topping its sales charts,
had turned on him.
Steven Goldstone, CEO of parent company RJR Nabisco, intimated to
shareholders that Thompson was a rogue who had redirected Europe-bound
cigarettes back into Canada without the top brass knowing about it.
"Employees are prohibited from engaging in smuggling or other violations of
the law," he said, adding that there will always be "the risk that dishonest
employees É will find ways to circumvent controls for their own personal
A month later, Thompson pleaded guilty to laundering $72 million U.S. from
smuggling tobacco into Canada and agreed to a seven-year sentence. A federal
judge in Binghamton, N.Y., will confirm the sentence Monday.
Thompson was the only RJR executive to be charged in connection with
cigarette smuggling. The company continues to deny it played any role in
But an investigation by The Gazette, which includes an exclusive interview
with Les Thompson, shows that RJR-Macdonald carried out a campaign to funnel
billions of cigarettes through a handful of traders and flood the
marketplace with the black-market tobacco.
The strategy was planned and executed by senior executives, with the
knowledge and approval of their parent companies, RJR International in
Geneva and RJR Nabisco in New York City, according to documents obtained by
For years, Canada's three big tobacco companies have denied allegations they
encouraged or condoned smuggling operations that moved more than 28 billion
cigarettes into the black market from 1990 to 1994, when Canadian tobacco
taxes were at their highest. The companies have claimed they simply sold to
licensed traders who regularly ordered their products. What happened to the
cigarettes, they have said, was not their concern.
The Gazette investigation reveals, however, that big tobacco companies
solicited the business and fought to hold onto it.
It reveals for the first time the inner workings of big tobacco in the
international smuggling game and how the industry marshaled its forces to
make huge profits out of a black-market economy that defrauded Canadian
taxpayers of an estimated $5 billion in tobacco taxes.
Each of Canada's big three tobacco companies - RJR-Macdonald, Rothmans
Benson & Hedges Inc., and Imperial Tobacco - organized their own corporate
structures or signed special contracts to service this black market. They
did so with an eye specifically on the tiny Akwesasne Indian Reserve at
Cornwall, which straddles the Canada-U.S. border and was the funnel through
which the vast majority of cigarettes were smuggled back into Canada.
Les Thompson, the investigation shows, was little more than a frontline
soldier in the massive corporate effort by RJR-Macdonald to use the
smuggling networks to make vast profits, increase its market share and
ultimately pressure Canadian governments to reduce tobacco taxes.
Far from simply selling cigarettes and fine-cut tobacco to licensed dealers,
RJR executives partied with smugglers, exchanged expensive gifts, pressured
traders to buy more cigarettes and then joked about the huge profits they
were making from the "feathers." Employees were cautioned to be careful what
they wrote on paper and were told to keep their mouths shut because "loose
lips sink ships."
"The company is chasing this business," Thompson said of RJR-Macdonald (now
called JPI-Macdonald after being sold to a Japanese company). "Let's be very
clear. The company didn't say, 'Hey, Les, good move, bringing in a container
a week. Where did that business come from?' They solicited the business.
They secured the business, and they chased the business and exploited the
business. Let's be very clear on that. It wasn't extra business. It became
Into the Black Hole
Smuggling in Akwesasne took off in 1988 when Ottawa and the provinces, in a
move to discourage smoking, imposed major tax increases on tobacco. By 1991,
the price of a carton in most provinces had risen to more than $45 and the
market for tax-free tobacco exploded.
Rothmans Benson & Hedges were the first Canadian brands on the black-market
scene. Imperial and RJR-Macdonald followed. Before long, the thin strip of
land on the American side of Akwesasne sported six large warehouses
continuously stacked to the roof with cases of Canadian-brand cigarettes
waiting to be smuggled across the St. Lawrence River, which conveniently
narrows as it flows past the reserve. From there, the tobacco moved easily
into the Canadian black market. Akwesasne was a smuggler's dream.
While all three major Canadian tobacco companies set up or used existing
corporate structures to feed the black market, RJR-Macdonald was probably
the most aggressive, clumsy and blatant.
Yet it was also the last to get into the market. In 1991, top executives at
RJR-Macdonald's 60th-floor head office at First Canadian Place in downtown
Toronto worried over field reports that the more aggressive U.S. marketing
by both Rothmans Benson & Hedges and Imperial was eroding profits and market
share on their Export 'A' cigarettes. Essentially a single-product company
with a declining blue-collar brand, RJR-Macdonald felt it could not stand by
and watch this happen.
An RJR-Macdonald marketing and planning study dated May 6, 1991, and
entitled "Canadian Brands in the U.S. - the Border Store Opportunity," notes
that the company's share of the market was so low, it had to take "drastic
and immediate action to obtain our fair share or better."
So in 1991, RJR-Macdonald decided to invest $1.7 million in "blitzing" this
market with 12 sales representatives controlled by mid-level executives Les
Thompson and Nigel Holmes. The sales reps would cover every major border
area from New Brunswick to British Columbia "missionary selling" - venturing
into virgin territory - to major stores near the border. The goal was to
increase market share to 25 per cent of cross-border trade.
But the plan was a bust. The black market grew so large in Canada that
Canadians didn't have to cross the border for cheap tobacco.
By the end of 1991, company executives realized that their sales efforts in
border stores were not paying off. So, Thompson said, they "took the gloves
off and went directly into the black market."
"Imperial and Rothmans were very, very successful in the business," he said.
"You could see their volume growing almost weekly. It was from the company's
standpoint a pretty frustrating period of time. We just obviously hadn't met
the right people."
That problem was about to be solved.
Three men - Larry Miller from Las Vegas and two brothers, Lewis and Robert
Tavano from Niagara Falls, N.Y. - wanted to expand their small but growing
business of supplying cigarettes to Indian smugglers.
The Tavanos were well-known, politically connected figures in Niagara Falls.
Robert had been a prominent Republican Party chairman until he was convicted
in 1975 of defrauding a local county government of $384,601 U.S. and of
bribing two local politicians. His brother Lewis was charged but not
convicted in the 1970s of participation in an illegal gambling ring. He
later moved to Las Vegas, where he ran a sports bookmaking and loan
operation. Buffalo police had linked the brothers to the late Stefano
Magaddino, a Buffalo crime boss.
Larry Miller was a Las Vegas casino equipment salesman who had come to the
Akwesasne reserve in 1989 to sell slot machines. He gave up that business
when he saw the big-profit opportunities in cigarette and liquor smuggling.
Through his Las Vegas connections, he joined up with the Tavanos and formed
LBL Trading Inc. (for Lewis, Bob and Larry), based in a small house along
the main strip in downtown Niagara Falls, N.Y.
They obtained a U.S. federal licence to sell tobacco to Indians and, with
money initially fronted by Las Vegas investors, began by purchasing Rothmans
Benson & Hedges brands out of a free-trade warehouse in Buffalo owned by Tim
and John Palisano. (Free-trade warehouse owners are essentially
freight-forwarders, storing cargo until it is picked up.)
The Palisanos' warehouse was stacked to the roof with Rothmans products
which LBL and other companies trucked to Akwesasne.
LBL was a small player in this business and began looking for a more direct
line to the tobacco manufacturers. Again the LBL owners relied on their Las
Vegas connections. Through an executive with the Las Vegas Four Seasons
Hotel, they obtained an introduction to a senior executive at RJR-Macdonald.
The introduction was timely. According to a company source, RJR-Macdonald's
duty-free section had been unsuccessfully trying to push various ship
chandlers (who supply duty-free goods to ships leaving for international
waters) and duty-free companies in Montreal, Toronto and Vancouver to buy
containers of cigarettes which they would divert to the U.S. to supply the
smugglers. Some of these companies had set up affiliates in the U.S.
officially to receive these shipments and then send them back through
Yet despite constant sales pressure, these customers never bought enough
volume to satisfy RJR-Macdonald's demands.
"We had them in Toronto a number of times," Thompson said. "Sat down with
(sales vice-president) Stan Smith and myself. They were frustrating times,
because these people were so slow to fill in the volume request that we were
putting on them."
Then LBL showed up. Thompson said he was directed in March 1992 by Smith,
his boss, to "call Bob Tavano and specifically set up a meeting."
"I asked Stan who Bob Tavano was and Stan Smith told me that (RJR-Macdonald
CEO) Ed Lang had been introduced to the Tavanos É that Ed Lang had received
a call from an executive at the Four Seasons, a mutual friend, and he in
fact handled the introduction to Lang to the Tavanos."
Thompson and his assistant, Wade Blonheim, met with Miller and the Tavanos
in March 1992 at the Como Restaurant, a popular Italian restaurant and deli
in downtown Niagara Falls, N.Y. Thompson said they showed him their trading
licence which allows them to sell to Indian reserves and boasted they had
been successful with Rothmans brands but felt they could do more volume if
they had a direct supply of Export 'A's from RJR.
"These people were ready to do business," Thompson said. "We weren't doing
very much business there (across the border) and we were in the process of
shifting gears and going direct to the black hole."
The Tavanos were prepared to start with one container a week and possibly
When Thompson got back from the meeting, he said, he gave a copy of LBL's
Indian trading licence to Paul Neumann, RJR-Macdonald's vice-president of
finance, whose department would vet the company's application to become a
Approval was almost immediate. A process that usually took weeks was
fast-tracked. No applications had to be filled out or financial statements
presented. Within a few days, LBL was granted a direct line to
RJR-Macdonald. All it had to do was pay up front for every shipment. The
word on LBL right from the beginning was a go. Basically, send in the money
and we'll ship the goods.
Checking for Bugs
Les Thompson, now 52, was a hard-driving RJR-Macdonald salesman who had
worked his way up the ranks by always reaching or exceeding his sales
projections. An exceptionally fit long-distance runner, he was considered by
colleagues to be aggressive, loyal, though not always likeable. But he
brought in the deals and relentlessly pushed customers to buy more. He had
been Ontario sales director and now Smith charged him with the task of
pushing tobacco on LBL and a string of other third-party distributors the
company had lined up.
Les Thompson never asked why. He just asked how high. But blindly accepting
this job was probably the biggest mistake he would ever make. RJR's approach
was "take no prisoners," and Thompson was the field general who would end up
Shipments began almost immediately. Every delivery was prepaid. "They would
fly cheques into whatever, Toronto Island, to our office, plenty of times
couriers driving right to our office. Nothing would be shipped until it was
paid," Thompson said.
"We were shipping one container a week, which represented 10 million
cigarettes or about 20 per cent of our weekly production."
Within a short time, RJR was shipping three to four containers a week to LBL
and other distributors. Sales briefs to Smith demonstrated that what the
company called the "parallel market" or "re-entry market" was fast becoming
first 30, then 50 per cent of the company's volume on a weekly basis, all
going through the black hole of Akwesasne.
The cigarettes were sent to a Palisano free-trade zone in Buffalo where they
were picked up by LBL and five other traders who shipped directly to
So fast and furious was the business that RJR-Macdonald had no time to
change the packaging to meet export requirements. So Palisano had to hire
people to unwrap every carton and place a "Not for Sale in Canada" sticker
on each package, then rewrap them for delivery to Akwesasne to make the
shipments look legitimate, Thompson said.
There was "no doubt in anybody's mind at any level of management at First
Canadian Place where these people were going to be selling cigarettes,"
With more than 50 per cent of its volume directed to the "parallel market,"
RJR-Macdonald became concerned about the legal implications, and decided to
consult its outside counsel, Tass Grivakes of the Montreal law firm
Thompson said he and Smith were told by Grivakes the company was entering
into a gray area that, while not illegal, could be a political hot potato.
Thompson commented: "You say, 'Gee, Les, you sound like a pretty naive cat
here. You didn't even know that this was illegal.' I had been coached prior
to getting involved in this business by a company lawyer. They convinced me
that this is a gray area in the business. It's not black. What you're doing
is a loophole in the business. 'Go forward, young man,' that type of thing.
It wasn't like, 'Jeez, Les, you better be very careful out there. You could
get arrested for managing this type of business.' That was never suggested."
He said the company also hired some retired RCMP officers to check all their
offices and the homes of executives for bugs. None were found.
Nevertheless, concerned about dealing directly with smugglers, RJR-Macdonald
decided it needed to distance itself further from LBL and its other border
So in mid-1992, RJR-Macdonald set up a company in Winston-Salem, N.C.,
called Northern Brands International Inc. and registered it in Delaware with
It was a subsidiary of RJR Nabisco Inc., an astonishing decision since it
linked the smuggling directly to the U.S. parent company while distancing it
RJR-Macdonald also opened a second front. In mid-1992, ostensibly to avoid a
threatened federal export tax on tobacco, RJR-Macdonald moved
cigarette-manufacturing machines out of its Montreal plant to Puerto Rico,
where the company began manufacturing Export 'A's for shipment to tax-free
zones in Buffalo and New Jersey and then into Akwesasne.
To disguise the shipments, R.J. Reynolds Tobacco International Special
Markets in Winston-Salem, which at the time was run by a Canadian named
Franco Gabriele, signed a deal in March 1992 with International Duty-Free
Trading N.V. (IDF) and its managing partner Bryan Harms, a shipping agent
based in Aruba (formerly the Dutch West Indies).
According to an IDF letter outlining the deal and obtained by The Gazette,
IDF agreed to act as a broker and shipper for "Canadian brands to some of
RJR's accounts in the U.S. that serviced accounts operating on the Indian
reservations straddling the Canadian-U.S. border."
IDF would handle not only this freight forwarding, but also all money
transactions, accounts receivable and payable. The cigarettes would be
shipped via Sealand Shipping Line to IDF in Aruba. The company then
reshipped them to Elizabeth, N.J.
According to a letter sent in 1994 to RJR-Macdonald by Harms, IDF's
accounting was simply book entries. IDF never actually handled any money.
That was controlled by RJR-Macdonald. Nor did IDF ever contact any of the
buyers. That too was handled strictly by RJR-Macdonald. On the books,
however, RJR-Macdonald was another step removed.
By the end of 1992, IDF saw more than $30-million U.S. worth of cigarettes
going through its books. But, according to the letter, not one penny went
into an IDF account. It was all paid by LBL and other distributors directly
to RJR-Macdonald's headquarters or through bank accounts in Puerto Rico or
(In 1993, RJR-Macdonald would put another $35.7 million U.S. through IDF's
books. In 1994, Harms threatened to sue the company. In a letter dated Feb.
22, 1994, to Ed Lang and labeled "Confidential," IDF claimed it was owed
more than $3 million U.S. for services rendered. The letter outlines the
entire Aruba operation. RJR-Macdonald promptly paid Harms the money owed,
Thompson said. In an interview, Harms refused comment claiming he needed
permission from U.S. prosecutors in Syracuse to speak about his dealings
At this point, RJR-Macdonald was now supplying smugglers from plants in both
Montreal and Puerto Rico.
It also established a third sourcing plant. In 1992, it contracted with
Standard Commercial Manufacturing in Wilson, North Carolina, to produce
Export 'A' fine-cut tobacco - loose tobacco sold in a can. Every leaf of
this tobacco would be targeted for the black market, Thompson said.
By 1993, Thompson said, all three plants were working overtime supplying
distributors for the Canadian black market. The "parallel market" business
grew to almost 60 per cent of RJR-Macdonald's net profits. Smuggling was
fast becoming the company's main source of income and the principal reason
why its Canadian market share was increasing.
The growing sales energized a company that for years had watched helplessly
as the popularity of its main brand, Export 'A', declined. The increased
volume and profits meant bigger bonuses for everybody. Just before Christmas
in 1992, RJR-Macdonald persuaded LBL to ante up $5 million U.S. to pay for
shipments that wouldn't be delivered until 1993 just so the higher-ups could
enter them into the 1992 books and claim bigger bonuses.
But LBL couldn't get the cheque to Toronto because of a snowstorm. So
Thompson said he flew to Dorval airport where he picked up LBL's cheque from
a courier sent by Miller. Then he dashed to the nearest Royal Bank branch
which had been kept open just so the money could be deposited into
RJR-Macdonald's account before the company closed its year-end books.
When he arrived back in Toronto, fellow executives called him "partner" and
gave high fives. "Pal, you just solidified your career to retirement," one
Executives were ecstatic about the new business. Thompson recalls them
making Indian war cries when he passed them in the executive corridors.
"Wooo, wooo, wooo!" They backslapped him and addressed him as "Chief."
Once, when TV news showed seizures of competitors' cigarettes, he said Smith
told him: "Either you are not selling enough or your customers are doing a
better job than the competition's in avoiding seizures."
Still, there was a growing desire to distance the company from the sales to
smugglers. The need to consolidate and create a tightly controlled corporate
structure became clear to top RJR-Macdonald executives and to the company's
parent, RJ Reynolds Tobacco International, which at the time was based in
Winston-Salem. (It would move the following year to Geneva, Switzerland.)
RJR Tobacco International organized a meeting of top financial people at the
Graylyn Conference Centre in Winston-Salem on March 5, 1993.
Representing RJR-Macdonald was Peter MacGregor, an executive in the
company's finance department and soon to become general manager of NBI.
MacGregor made his presentation at about 10:15 a.m. It lasted about 30
minutes and outlined the reasons why and how RJR-Macdonald would use NBI as
its conduit for selling cigarettes to the smugglers.
He described the high taxation problem in Canada and the "strong demand for
tobacco products in lower-(tax) or tax-free jurisdictions" - that is,
It was decided that all product from the Montreal plant destined for the
United States would be sold to NBI, which in turn would handle all
warehousing in free-trade zones and all sales to third-party distributors
such as LBL.
While NBI would be owned by RJR Nabisco, it would take all its instructions
from RJR-Macdonald. Its payroll would be met by RJR Tobacco International.
MacGregor's presentation noted that this new structure would assure that a
dedicated sales team was in place to push as many cigarettes as possible in
the northern New York area.
RJR-Macdonald relocated Les Thompson and Peter MacGregor to Winston-Salem -
Thompson as sales director and MacGregor as finance director and general
manager. Essentially, they were in charge of pushing as much product on the
smugglers as possible. NBI, with its two employees and a secretary, was
basically an American sales tool for RJR-Macdonald.
"(It was) of a highly sensitive nature, and the consideration for moving to
the States was that it was very sensitive here, an out-of-sight out-of-mind
type of an application of business," Thompson said.
Before he left for Winston-Salem in February 1993, RJR-Macdonald threw
Thompson a going-away party. It was held at an Italian restaurant in
Oakville, west of Toronto, and was hosted by Stan Smith who lived close by
in a large clapboard home on the lakeshore. The party went on into the early
hours of the morning with about 60 to 70 raucous guests plus their wives or
girlfriends. At its peak, Smith presented various gifts to Thompson and his
"Les, we've got a special gift for you and it took my secretary two days to
find," he announced. "When you open the gift all I ask is that you put it on
and you wear it. You have to wear the gift."
Thompson opened the box and pulled out a large Indian headdress. When he put
it on, its dangling eagle feathers almost touched the floor. Partygoers
laughed and cheered.
"The message was clear: 'Les was going to be selling lots of cigarettes to
the Indians,' " Thompson said.
Ensconced in NBI's offices at RJR Nabisco in Winston-Salem, Thompson began
working the tobacco traders as he had done at head office in Toronto.
Documents obtained by The Gazette show that weekly, sometimes daily, reports
were sent by NBI to RJR-Macdonald seeking permission on each sale. Stan
Smith signed off on them.
Thompson said RJR International lawyer Pierre Bourassa made regular visits
to NBI offices and received regular briefings from Thompson and MacGregor on
the progress of the business.
NBI regularly sent salesmen into Akwesasne to check inventories of
RJR-Macdonald and its competitors in Indian warehouses, and assess
RJR-Macdonald's market share. Both MacGregor and Thompson went along on some
of these field trips. Thompson said he made about eight trips to Akwesasne
where he and other employees inspected warehouses and talked to Indian
smugglers. All reports were sent to head office, he said.
One sales report dated Sept. 16, 1993, and written by Chris Fragomeni, an
RJR-Macdonald salesman, referred to the Indian warehousing operations as
"gray-market accounts." It stated that RJR-Macdonald products accounted for
between 40 and 60 per cent of inventories in the reserve's six warehouses.
Imperial had 15 to 40 per cent and Rothmans Benson & Hedges 10 to 20 per
cent. It was clear NBI was making headway. RJR-Macdonald executives began
referring to it as "Nothing But Income."
Competition to supply the "parallel" or "re-entry" market was expanding and
by 1993 each of the three major Canadian tobacco companies were using
basically identical corporate structures all feeding the same distributors
who in turn fed the same Indian smugglers at Akwesasne.
Imperial Tobacco had decided in 1992 to go full steam ahead in supplying
what it called its U.S. customers. First, however, the company had to settle
longstanding trademark and royalty issues.
Since the Philip Morris company held the rights to sell Players in the U.S.,
Imperial signed a contract on Sept. 29,1992, with Philip Morris to sell
Players to the U.S. company. The confidential agreement, obtained by The
Gazette, specified that the Canadian taste, quality and packaging would be
maintained and each package would carry the legend "Made in Canada by
Imperial Tobacco, Montreal, Canada for Philip Morris Inc."
Documents obtained by The Gazette show Philip Morris's first order was for
150 million cigarettes or 15 40-foot containers. The first shipments were
made Nov. 23 directly to Philip Morris.
Philip Morris sent most of the loads to a New Jersey ship chandler named J.
Stanley Inc., who then sold them to LBL and other distributors.
Imperial marketed its du Maurier brands through a Miami-based trader named
Jorge Azel and his company SMT. Most of the SMT du Mauriers were trucked to
warehouses in Port Elizabeth, New Jersey, and then sold to third-party
distributors such as LBL or Milhem Jr. Attea, a Buffalo trader, sources
Because of trademark restrictions, Imperial was not allowed to sell du
Maurier into the U.S. without paying a 5-per-cent royalty to Peter Jackson
(Overseas) Ltd., which, like Imperial, is owned by British American Tobacco
(BAT). Since the vast majority of du Mauriers sent south were smuggled back
into Canada, Imperial wanted a new deal. So in June 1993, Imperial's
president, Don Brown, negotiated a royalty reduction to 2 per cent.
In a letter to BAT executive Ulrich Merter in London, England, Brown wrote:
"Until the smuggling issue is resolved, an increasing volume of our domestic
sales in Canada will be exported, then smuggled back for sale here."
In 1993, Imperial sent more than 6 billion cigarettes, or at least 600
40-foot containers, into the U.S., according to figures the company gave The
One smuggling source told The Gazette that Imperial actively solicited
business from smugglers. He said he met with an Imperial marketing agent
named Richard Ward in the executive offices of the company's Montreal
headquarters on at least three occasions in 1991 where they discussed
purchasing tobacco which the company would deliver to the U.S. for the
smugglers to bring back into Canada.
"It was clearly identified that the goods would be in the Canadian black
market," he said. "Richard Ward suggested that he would deliver cigarettes
to a free-trade zone in Miami or any other free-trade zone as long as it
wasn't too close to Akwesasne." He added that the company didn't want to
appear to be feeding the black market.
Rothmans Benson & Hedges was a similar story. Its equivalent of NBI was an
already established affiliate called Tobacco Exports International, run out
of Atlanta, Ga. Its cigarettes went to the same smuggling networks. In 1992,
it sent 3.5 billion cigarettes into the States. Most of them were smuggled
back into Canada.
Sources said Imperial and Rothmans used a relabelling plant set up in
Champlain, N.Y., and run by a Montrealer named Michel Sylvestre. The plant
was used to put American Surgeon-General stickers on the packages and reseal
them with cellophane to meet U.S. packaging requirements and also so they
wouldn't look as though they were ultimately destined for Canada. One source
said Imperial helped obtain the machinery for this operation from England.
With all three major cigarette manufacturers now deeply involved in feeding
the black market, the chase was on to secure the loyalty of their
third-party distributors, like Miller and the Tavanos.
An essential part of the marketing and sales strategy became entertainment.
RJR-Macdonald approved about $1.6 million U.S. for NBI to entertain
customers, Thompson said. "Whatever they wanted was not out of the
This meant fishing and gambling trips to the Bahamas and to Sonora Lodge, a
class 'A' fishing and leisure camp in British Columbia. The Tavanos and
Larry Miller and his family were invited to golf tournaments, Formula One
racing, and hockey and baseball games where they received VIP treatment.
They schmoozed with RJR-Macdonald CEO Lang and other senior executives. The
Tavanos gave gifts to RJR-Macdonald employees which included free weekend
trips to Las Vegas; Thompson received a 1994 Cadillac from Miller.
NBI also dealt heavily with SMT. Its owner, Jorge Azel, loved baseball. So
Lang flew him up for Blue Jays World Series games.
In return, the customers continued to buy container loads of Export 'A',
stacking warehouses south of the border to the roof.
Throughout 1993, NBI's business boomed. That year it sold 5 billion
cigarettes -including fine-cut - into the black hole, Thompson said.
Essentially a two-man shop in Winston-Salem, it nevertheless accounted for
63 per cent of RJR-Macdonald's net profit.
By the end of 1993, NBI profit reached $78 million U.S. The company's total
1993 net profit was $122 million U.S.
Before the company began dealing directly into the black market,
RJR-Macdonald's total net earnings were about $74 million U.S., Thompson
What's more, its aggressive sales policy had pushed its share of the
Canadian market to about 20 per cent. Even though the cigarettes were sold
in the U.S., the sales were entered into the company books as Canadian
domestic market share.
"So when the CEO stands up in front of his boss, he can say:
'Well, you know, we made $122 million, we sold 8 billion units and we drove
our market share in Canada to over 20 per cent through these efforts,' "
Continued on part 2
Saturday 18 December 1999
Tobacco insider talks: Part 2
Major firms were deeply involved in cross-border smuggling, former executive
Continued from part 1
'Nothing but Inmates'
Statistics Canada figures show the big three tobacco companies exported 14.2
billion cigarettes into the U.S. in 1993, plus about 3 billion units of
fine-cut tobacco. This does not include the cigarettes manufactured in
Puerto Rico or the fine-cut made in Wilson, N.C.
The heady pace at which the tobacco companies were feeding the black hole of
Akwesasne finally forced the federal and provincial governments to roll back
taxes in February 1994 by as much as $20 a carton. Exports to the U.S.
plummeted to about 2 billion cigarettes and 600 million units of fine-cut.
But the smuggling did not entirely dry up. Even with the thinner margins,
some traders found it profitable. RJR-Macdonald continued to ship cigarettes
through NBI to third-party distributors such as the Tavanos and Miller.
NBI's net profits nose-dived to below $10 million U.S. But with only two
people on the payroll it was still considered a win-win situation. NBI was a
sort of insurance policy against future Canadian tax hikes, Thompson said.
Only the four western provinces kept their taxes high. So Thompson said Stan
Smith told him to "get your ass up to Alaska" and evaluate whether
cigarettes could be sold to smugglers through free-trade zones in that
state. Thompson reported back that the geography was too much of an
NBI first learned there might be a police investigation into
smuggling-related offences in January 1994 when it received a subpoena from
a U.S. district court in Buffalo, N.Y. A grand jury wanted to see documents
relating to shipments of cigarettes into a Buffalo free-trade zone.
By 1995, the investigation was in the hands of U.S. Assistant District
Attorney Gregg West, head of the district's permanent strike force. He
targeted Miller, his family, the Tavanos and their main Indian customers.
He also targeted NBI and Les Thompson. Because he was RJR-Macdonald's front
man, Thompson's name seemed to be on every smuggler's lips.
When police told Thompson in June 1998 that he was the focus of a smuggling
investigation, RJR-Macdonald executives joked that NBI now stood for
"Nothing But Inmates."
Thompson said he was constantly told to "stand tall" and keep his mouth
shut. He said company officials were worried that MacGregor, NBI's general
manager, might be talking to police.
At a skins golf match in August 1997 in Whistler, B.C., Thompson said: "Ed
Lang took me aside and said: 'I want you to go back and tell MacGregor,
'Loose lips sink ships.' "
During this time, Thompson was still working out of Winston-Salem directing
duty-free sales in the northeast U.S. He said the company regularly supplied
ship chandlers with containers of tax-free Winstons to be sold in the high
tax markets in Europe.
When European police began seizing these shipments, Thompson said he was
told to cut back on the sales to these chandlers to one load a month. They
wanted to keep the distribution channels alive, he said.
He said he was then shifted to Miami where he would operate the duty-free
sales along the Mexico border. "That largely is a cross-border environment
very similar to what went on in the black hole in Cornwall," he said.
Meanwhile, RJR-Macdonald officials had begun leaving the company. Lang had
resigned in 1993, retiring to a condo in Naples, Fla., though he remained on
the board of directors. Peter MacGregor left NBI and took a job with Porsche
America in Atlanta, Georgia.
Paul Neumann, Roland Kostantos, both vice-presidents of finance at
RJR-Macdonald, and Pierre Brunelle, company president in charge of the
Montreal plant, moved to Geneva to work for RJR International.
Stan Smith, who became chief operations officer, took a severance buyout in
1998. Last September, he moved to London, England.
Les Thompson was the only tobacco executive to be charged.
As for the firm he helped run, Northern Brands International Inc. pleaded
guilty to a minor customs infraction and paid $15 million U.S. in fines and
forfeiture. As part of the agreement, the U.S. Justice Department Northern
District pledged not to take any further action against RJR Nabisco, the New
York parent company.
In November 1998, Philip Morris reported to shareholders that it is under
investigation in the U.S. for alleged involvement in tobacco smuggling into
Meanwhile, the RCMP have launched three task forces to probe industry
complicity in the smuggling. The Mounties raided RJR-Macdonald's head office
in May. The firm has stated it is co-operating with the investigation and
beyond that cannot comment.
A Cornwall-based RCMP task force is targeting U.S. distributors and last
spring charged the J. Stanley company and its owners with conspiracy to
defraud the Canadian government.
A Montreal task force is investigating Imperial Tobacco.
The federal justice department is also assembling proof for a possible
billion-dollar lawsuit against the industry for tax fraud. The government is
planning to launch the suit in New York State.
This year, RJR-Macdonald offered to settle for $100 million. The government
rejected the offer.
Wednesday 22 December 1999
Tobacco giant targeted
RJR-Macdonald hit with $1-billion suit by Ottawa
The Gazette; CP
The federal government launched a sweeping lawsuit yesterday against
RJR-Macdonald, RJ Reynolds Tobacco Holdings U.S. and several related
companies, alleging that from 1991 to 1997 they orchestrated an
international tobacco-smuggling conspiracy that defrauded Canadian taxpayers
of more than $1 billion U.S.
The action was filed in U.S. Federal Court in Syracuse, N.Y., under
civil-racketeering and corrupt-practices legislation. Ottawa claims most of
the conspiracy took place in the United States and is seeking more than $1
billion in damages.
The U.S. racketeer law gives courts the power to award triple the value of
damages claimed, meaning the federal government could possibly win more than
In announcing the action, federal Justice Minister Anne McLellan said Ottawa
is seeking to "restrain the defendants and their co-conspirators from
engaging further in smuggling," to force the company to surrender its
profits and to recover "substantial damages suffered by Canada."
McLellan noted that the smuggling worked against the government's policy of
using high prices to discourage smoking, particularly among young people.
She blamed the companies for causing an increase in teenage smoking by
thwarting the government's high-tax policy.
The landmark suit will be prosecuted before a Syracuse jury by Chicago
lawyer Fred Bartlit, a former U.S. army ranger and specialist in litigating
large civil actions.
Bartlit said he had no idea when the case would come to trial, but it "could
take a while."
In Toronto, Guy Cote, a spokesman for RJR-Macdonald, now called
JTI-Macdonald, refused to comment other than to say:
"I welcome the court initiative in the sense that it will give us an
opportunity to tell our side of the story. Contraband and counterfeit are
very, very complex issues, more complex than most people would think."
Absent from the suit is any mention of Canada's two other tobacco companies
- Imperial Tobacco Ltd. and Rothmans, Benson & Hedges. Those firms also
dramatically increased their cigarette exports to the United States in
On Saturday, The Gazette revealed that both firms had set up elaborate
corporate structures and contractual agreements to feed the U.S. border
trade with cigarettes smuggled back to Canada. Their cigarettes were sold to
the same traders and smugglers used by RJR-Macdonald.
Revenue Minister Martin Cauchon said the government will closely examine the
actions of both firms and take whatever action is necessary.
McClellan confirmed the government will sue companies other than
RJR-Macdonald "if and when we have sufficient evidence."
The government is also suing the Canadian Tobacco Manufacturers Council, the
industry lobbying association based in Ottawa, claiming it was part of the
conspiracy to cover up RJR-Macdonald's scheme to supply smugglers. The
council refused to comment.
The government's 74-page complaint says the conspiracy began in 1991 when
Nigel Holmes, regional sales director of RJR-Macdonald, presented a plan to
the company's operating committee to feed smuggling networks in the
Akwesasne Indian reserve near Cornwall, Ont.
The suit charges that at this stage senior management wanted to preserve a
"posture of plausible deniability, amounting to wilful blindness." Ed Lang,
RJR-Macdonald's chairman and chief executive officer, is said to have told
the committee to make certain that "future presentations not be as
In 1992, Les Thompson, RJR-Macdonald's senior sales manager, gave the
company's operating committee a second presentation on the advantage of
entering the smuggling market. "Lang complimented Thompson on the
presentation," the lawsuit states.
At the direction of Lang and Stan Smith, RJR-Macdonald's vice-president
(sales), Thompson and an assistant met with smugglers Lewis and Robert
Tavano and Larry Miller. A follow-up meeting was held between the three
smugglers and Paul Neumann, the company's chief financial officer, and
Franco Gabrieli, a sales executive with RJR International.
The government charges that RJR-Macdonald and RJR U.S. set up two production
lines in Puerto Rico to manufacture Canadian Export 'A's specifically to
feed the Canadian black market. To help conceal this offshore production,
the shipments were funneled through companies in the Caribbean islands of
Aruba, Antigua and St. Martin.
The smuggling increased executive bonuses and by the end of 1993 accounted
for more than 60 per cent of RJR-Macdonald's net profits of more than $100
million U.S., the suit says.
In an effort to further buffer itself from the smuggling, RJR-Macdonald set
up Northern Brands International in Winston-Salem, N.C.
The government alleges that NBI was set up to facilitate the smuggling of
Canadian brands into Canada. To conceal this purpose, the company directed
one of its lawyers, Paul Bourassa, to establish NBI as a subsidiary of RJR
Nabisco, thereby distancing it from the Canadian company.
NBI directors included Jaap Uittenbogaard, vice-president of RJR
International, and J. Thomas Pearson, senior vice-president (taxation) of
RJR Nabisco from 1992 through 1997.
NBI sold all its cigarettes to nine tobacco distributors, including three
Montrealers, two of whom had established U.S. companies. These included JBML
International Import & Export of Buffalo, N.Y., owned by Jean Bill of
Montreal; the Wade Group and its U.S. affiliate Cardora, owned by Gideon
Loran and Cindy Cherwin; and SV International Trading, owned by Jean Gareau.
All of these companies purchased cigarettes and fine-cut tobacco from NBI or
directly from RJR-Macdonald for shipment to Akwesasne, the government
claims. Earlier this year, the RCMP charged Jean Gareau with tobacco
The government claims the scheme was known at the highest levels of RJR's
holding company, RJR Nabisco. The suit describes how Lang in October 1993
gave a presentation about RJR-Macdonald's third-quarter results to senior
officials from RJR International, RJR U.S., and RJR Nabisco. It was attended
by RJR Nabisco's CEO, Lou Gerstner, who is now chairman of IBM. When Lang
reported that NBI earned about $58 million U.S., Gerstner asked how that was
"But before Lang could respond, the CEO stated that he now remembers that
NBI was in the 'feather' business up in New York," the complaint states.
Other evidence cited by the government that management participated in the
smuggling scheme and knew it was unlawful includes:
- Lang had a "dummy office" set up across from RJR-Macdonald's corporate
headquarters for senior managers to use when transacting smuggling business.
- Lang instructed management to sell Export 'A' cigarettes to customers in
the Caribbean or Africa so that the "NBI customer list would show more names
than just the few customers in the smuggling market."
- Lang hired former RCMP officers to check for bugs in telephones and
computers at RJR-Macdonald headquarters.
- When Lang was transferred to the U.S. in 1994, he was presented at a
going-away party with the "Akwesasne Order of Canada" to mock Canada's Order
After the federal government rolled back taxes, the company continued to
feed the smuggling market as an "insurance policy" against possible future
tax increases. In 1995 and 1996, NBI earned net incomes of $16 million U.S.
and $20 million U.S. respectively, the complaint states.
Thompson, who has been sentenced to 70 months in jail, was one of several
former company executives interviewed by the Justice Department. He said
yesterday that the lawsuit vindicates his assertion that he was not acting
alone when he sold to smugglers.
"It's the most positive thing that has happened (since my arrest)," he said.
Tuesday January 04, 2000
Mohawks threaten lawsuit for tobacco-smuggling 'damage' Akwesasne council
accuses federal government of using reserve as 'scapegoats'
The Ottawa Citizen A Mohawk reservation straddling the Canada-U.S. border
is threatening to sue the Canadian government for "damages" caused by
rampant tobacco smuggling through the reserve earlier in the decade. The
reservation's governing council said yesterday it is considering the legal
action following the government's announcement it has launched a $1-billion
U.S. lawsuit against tobacco giant RJR-Macdonald Inc. The federal
government's lawsuit, filed in the United States Federal Court, alleges
RJR-Macdonald, RJ Reynolds Tobacco Holdings and several related companies
defrauded Canadians by conspiring with known distributors and smugglers to
illegally import their tobacco products into Canada to be sold on the black
market. The lawsuit alleges most of the tobacco, produced in Canada for
export to the lower-priced U.S market., was smuggled back into Canada
through the St.-Regis-Akwesasne Reserve near Cornwall. The reference
prompted the Akwesasne Mohawks to accuse the federal government of using the
reserve and other reservations as "scapegoats" to deflect blame for its
failure to stem the smuggling. "Canada's present claim that tobacco
companies, not Mohawks, were behind the problems, does not adequately repair
the damage done to our community by past inaction," the council said.
Council chief Michael Mitchell added that the reference to the reserve in
the Canadian lawsuit fails to recognize "the social and economic hardships
we have endured as a result of this (smuggling) activity." A statement
released by the council claims the federal Indian Affairs and Northern
Development Department and the Justice Department consistently rejected
Akwesasne council proposals to combat the smuggling. "Over the past 15
years the Mohawks of Akwesasne have repeatedly tried to put into effect laws
which would protect the community from being used as a corridor for criminal
activity," the council said. Mr. Mitchell said the federal government
rejected a Mohawk proposal in 1987 for the creation of a Mohawk border
patrol to stem the smuggling. "Canada rejected this offer and in my view
this caused tremendous damage to our community and Canada's economy over the
next decade," he said. A spokesman for the federal Justice Department could
not be reached yesterday for comment on the Mohawk allegations. Shortly
after the Liberal government took power in 1993, it dramatically reduced
federal tobacco taxes to curb smuggling through the Akwesasne reserve. The
strategy worked, but Health Minister Allan Rock said the resulting lower
cigarette prices caused a sharp increase in smoking by teenagers between the
ages of 15 and 19.
GREENPEACE JOINS AKWESASNE FIRST NATIONS IN RALLY AGAINST DANGEROUS
Local Liberal MP asked to take stand to keep people safe.
A JOINT MEDIA ADVISORY FROM GREENPEACE CANADA
AND THE MOHAWK COUNCIL OF AKWESASNE
OTTAWA, Nov. 2 /CNW/ -
What : Protest rally among diverse communities against the planned
shipment of plutonium from Russia through Canada and First Nations
Where : Lamoureux Park near the Cornwall Civic Complex,
Cornwall,Ontario (at the base of Sydney Street and Water Street South).
When : 12:00 noon to 2:30 p.m., Thursday, November 4th, 1999.
On Thursday, November 4th, 1999, Greenpeace, environmental
activists,civic leaders and First Nations Chiefs, elders and youth will
mobilize in a rally organized by the Mohawk Council of Akwesasne (MCA) to
say NO to the import of plutonium from Russia and the United States.
A shipment of plutonium from Russia is expected to cross through
Akwesasne and Cornwall via the St. Lawrence Seaway. Despite numerous
attempts by the Akwesasne Chiefs to obtain details of the planned shipment,
Canadian officials have refused to comply.
The scheme to import plutonium is part of Atomic Energy of
Canada's(AECL) plan to burn MOX at its experimental reactor in Chalk River,
MOX fuel is a mixture of uranium and plutonium. Depending on test results
up to 50 tonnes of plutonium could be imported into Canada over 25 years.
For further information: Larry White, Mohawk Council of Akwesasne:
Cell.613-930-3288; Holly Penfound, Greenpeace Canada: Cell. 416-723-9425;
Johanne Fillion, Greenpeace Canada, in Montreal (for interviews in either
English or French): Tel. 514-933-0021; Damon Moglen, Nuclear expert,
Greenpeace International, Tel. 514-933-0021. For background information on
the MOX issue: www.greenpeacecanada.org. For Transport Canada routing and
MOX test. decision-making information : www.tc.gc.ca/tdg/info/mox_e.asp
.....and some cigarette smoking-cancer information to put things in
SYMPATICO NEWSEXPRESS NATIONAL NEWS
Fri, Apr 9th
Lung disease driving up cancer rates
TORONTO (CP) - More Canadians will face cancer in the next decade, but
they'll live longer and have a better chance at beating it.
Incidence and death rates for most cancers have stabilized or declined in
the last decade.
There will, however, be more new cases of all types of cancers, particularly
lung disease, early in the next millennium, suggests a report released
Thursday by the Canadian Cancer Society.
Smoking is a prime culprit, but so is an aging population.
"The biggest risk factor for almost all cancers is age," said Dr. Barbara
Whylie, the society's director of medical affairs.
"That's simply because cancer is a degenerative disease - it occurs as a
result of injuries to genetic makeup over the years."
The report says 70 per cent of all new cancers and 80 per cent of cancer
deaths occur in people over 60.
Heart disease continues to be the biggest killer of Canadians. But cancer is
the leading cause of premature death, says the report.
This year, it is estimated there will be 129,300 new cases of all types of
cancer, as well as 63,400 deaths, compared to 101,000 new cases and 52,500
deaths in 1989.
Almost a third of those deaths in men and 25 per cent in women are caused by
If trends continue, rates of new cancers are expected to increase 70 per
cent by 2010. This means one in four Canadians can expect to be diagnosed
with cancer during his or her lifetime.
But people with cancer are living longer - just more than half will be alive
after five years compared to one-third in the 1930s.
And statistically, fewer people are getting or are dying from cancers such
as colorectal, bladder, testicular and cervical cancer and Hodgkin's
There are more cases of breast and prostate cancer, but here too, the
survival rate has improved.
Researchers stress aging in itself doesn't necessarily lead to cancer. In
fact, snuffing out smoking alone will dramatically reduce the risk, said
Nine of 10 lung-cancer deaths are caused by smoking, which is also a risk
factor for many other cancers and diseases, said Brian Graham of the
Saskatchewan Lung Association.
"One of our most important messages is lung cancer is mostly a preventable
disease," he said from Saskatoon.
Although fewer men are smoking, more women - especially those between 20 and
25 - are taking up the habit, he said.
The expected increase in lung cancer is also driven by the fact it can take
20 years for the disease to develop.
Lung cancer is also difficult to detect early and treat, said Graham.
Because the lungs are connected with the blood supply, cancer can spread
Half of patients die within six months of diagnosis.
© The Canadian Press, 1999
Smoking linked to leukemia
November 12, 1999
Web posted at: 4:13 PM EST (2113 GMT)
LONDON (Reuters) -- Smoking can cause cell damage and changes in the body's
immune system that could increase the risk of adult leukemia, British
researchers said Friday.
Scientists at the University of Leeds in northern England who examined the
smoking history of more than 800 leukemia patients found that up to 10
percent of acute cases of the deadly blood cancer could be related to
The research, which is published in The British Journal of Cancer, supports
previous studies linking smoking to leukemia.
"This is the biggest study of its kind and confirms what has been found
before," Eleanor Kane, one of the researchers, said in a telephone
The scientists said tobacco smoke contains harmful agents such as benzene,
radioactive lead and polonium, nitrosamines and urethanes that are suspected
causes of the disease.
"Benzene in large doses is known to cause leukemia. That might not be the
full picture. There are other chemicals, and it could be a combination of
them," Kane added.
The researchers found the biggest risk of leukemia was in people who had
smoked for at least 10 years. They estimate the habit could be responsible
for as many as 200 cases of adult leukemia in Britain each year.
"Although the biological mechanisms are unknown, what is understood is that
tobacco smoke leads to chromosomal defects in blood cells and immunological
changes such as an increased leukocyte (white blood cell) count and
decreases natural killer cell activity, factors which are linked to
leukemia," said Kane.
But the researchers also had some good news.
Their study showed that people who give up smoking can reduce their risk of
leukemia to normal levels within a year of quitting.
"Smoking is still not widely accepted as a cause of leukemia, especially by
members of the public. This research provides yet further evidence of a
major link between the habit and this life-threatening disease," Dr David
Grant, of Britain's Leukemia Research Fund, said in a statement.
BBC News - Health
Thursday, 25 November, 1999, 18:50 GMT
Grim toll of smoking
More than 122,000 British smokers will die prematurely in the year 2000 from
a smoking-related disease, according to the World Health Organization (WHO).
The calculation is based on the fact that 28% of men and 27% of women in the
UK are smokers.
The WHO has developed a technique to assess the impact of smoking on
society, and to measure the effect of successfully persuading people to give
up the habit.
If the government concentrated efforts at persuading people to quit, it
says, then millions would be slashed from the future cost of treating
Using the model, WHO researchers have calculated that over the next 20
Forty-six per cent of the current smoking population - approximately seven
million people - will have acquired a smoking-related illness.
2.4 million smokers will have died from a smoking-related disease
An estimated £30bn will be spent on treating six key smoking diseases
- - - - - - - -
Key smoking -related problems
Chronic Obstructive Pulmonary Disorder
Coronary Heart Disease
Low birth weight babies
- - - - - - - - - - - -
The WHO has calculated that if the UK government can increase the rate of
quitting among smokers to 4.4% in any one year, then £44m savings would be
made in treating smoking-related diseases during the next 20 years.
If three out of 10 smokers could be helped to quit the total saving on
healthcare spending would jump to £253m.
Dr Peter Anderson is acting director of health promotion and disease
prevention at the WHO regional office for Europe.
He said: "The WHO hope that this data will convince governments to back
initiatives to encourage quitting, which in turn will achieve significant
benefits for their healthcare systems."
Quitting smoking at any age has a positive impact on a person's health.
After one year an ex-smoker's risk of a heart attack is the same as that of
a person who never smoked.
In any one year, 36% of smokers attempt to quit. However, nine out of 10
fail because most try to quit using willpower alone.
The success rate is greatly increased if a smoker seeks professional help.
The WHO has calculated that if drug therapy helped 4.4% of smokers to quit,
it would cost £1,579 for every year of life saved.
If the success rate was 19%, the cost would fall to £356 per year of life
This makes drug therapy much cheaper than the cost of treatments such as
hypertension drugs and coronary artery bypass graft surgery.
Clive Bates, director of the anti-smoking charity Action on Smoking and
Health (ASH), said: "The basic message is that it is much cheaper to target
efforts at helping people give up now, rather than paying to mop up the mess
when they get older and very ill."
Mr Bates called on the government to make products such as nicotine
replacement therapy more easily available.
The WHO's Health and Economic Consequences of Smoking (HECOS) model can be
found on the WHO Europe