Cigarette smuggling from Ukraine to the European Union and the production of illegal products without excise stamps are alarming facts that Ukraine has been associated with for many years. Despite martial law and increased control, this business continues to flourish without slowing down. Let's consider the problems, the scale and possible ways to solve this situation.
No matter how many media outlets name the names of Gelzin, Karfik, Alperin and other semi-criminal elements who enrich themselves on the production of counterfeit tobacco products, and visas are still there. But since the beginning of the year, the BEB and the State Bureau of Investigation have gradually begun to intensify their work on stopping shadow schemes in this area. What is worth only 24 simultaneous searches conducted in mid-May in premises associated with the "tobacco barons".
On May 15, the Chairman of the Committee on Finance, Tax and Customs Policy, Danylo Getmantsev, paid tribute to the detectives of the Bureau of Economic Security for their work in detecting the illegal production of cigarettes and their supply to the countries of the European Union. The reason for this was the mass searches at tobacco factories and warehouses of the largest domestic tobacco producers, about which there is information about their illegal activities. Getmantsev veiledly named two of these producers. In one of the cases, we are talking about "Tabako Dim", which in March 2024 changed its name to LLC "Local Production Group". He is associated with businessman Yuriy Karfik, who is called in the media nothing other than a "converter".
As for other searches, they took place at a factory in Ternopil, at the Odessa production facility of sanctioned smuggler Vadym Alperin, and at a factory in the village of Goshcha, Rivne region, whose activities are supervised by a person involved in the "Monaco Battalion" investigation - former football player and owner of the "Pchyolka" chain of stores, Vladyslav Gelzin.
According to Kantar Ukraine, the share of illegal tobacco products on the market has reached a record high of 25.7%. At the same time, counterfeit products have two types of “promotion to the market” – counterfeiting of excise stamps and the formal Duty Free mark. The factory in Goshcha, which is officially called Ukrainian Tobacco Production LLC, specializes in counterfeiting excise stamps. If out of 100% of counterfeit cigarettes, 26% are sold with illegal excise stamps, then as many as 15% of them come from the Gelzin factory. At least, this is the data published by Kantar Ukraine.
The May searches were not the only ones that took place at the Goshcha factory this year. Detectives from the Bureau of Economic Security visited the factory on April 1. In addition to illegal tobacco, boxes of cigarettes with fake excise stamps, and printing, several mobile lines for the production of tobacco products were also discovered. The Gelzin factory has long been dubbed “nomadic,” because in fact it is only partially located in the Rivne region. Some of its unofficial branches are constantly moving from place to place to avoid being targeted by law enforcement officers.
Another know-how of tobacco magnates is to voice information about shelling, which allegedly affects production facilities. On March 25, a meeting of the Verkhovna Rada Committee on Finance, Tax and Customs Policy was held. At that meeting, tax officials stated that the Helzin tobacco factory in Goshcha is allegedly periodically hit by drones that destroy raw materials for cigarette production. At least, this is what the tax authorities are told by Ukrainian Tobacco Production LLC. They are allegedly explaining by this that there may be discrepancies in the financial statements between purchases and production.
In this context, it is also worth recalling that according to the results of 2022, the Gelzin factory entered the so-called TOP of illegal cigarette manufacturers. Information about this was announced at a meeting of the Temporary Investigative Commission on the Illegal Circulation of Tobacco Products on April 25, 2023. At the same time, during this period, the factory purchased 0 excise stamps.
That is, the raw materials are being destroyed by the aggressor, excise taxes are not being purchased, but production is in full swing, which is confirmed by constant searches by the BEB.
In February of this year, another incident related to the work of Vladislav Gelzin's illegal cigarette factory occurred. Employees of the State Bureau of Investigation, together with the State Border Guard Service and the State Customs Service, exposed an illegal cigarette smuggling scheme from Ukraine to Romania, which had been operating since July 2023. The "schemers" transported large batches of tobacco products without excise stamps to the EU in fuel tanks.
Thus, in early February, law enforcement officers discovered two trucks carrying counterfeit cigarettes. In the first, 130 boxes were found, the value of the products in which reaches 4.5 million hryvnias. In the second, 335 boxes worth 12 million hryvnias were found. Law enforcement officers reported that the cargo was related to the converter factory of Yuriy Karfik, who runs the enterprise in Kyiv. At the same time, the SBR officers add that, according to operational information, law enforcement officers may appear in the scheme. However, the media learned that among these 465 boxes of "burnt" cigarettes was a batch that was manufactured at the Gelzin factory in Goshcha.
Later, BEB also reported that two more abandoned trucks with illegal cigarettes were found. One in Solotvino, Zakarpattia Oblast, and the other in the village of Zazimya, Kyiv Oblast. Some of the products in them could also have been manufactured at the production facilities of Vladyslav Gelzin's Ukrainian Tobacco Production LLC.
In the spring of 2023, Prime Minister Denys Shmyhal instructed to step up efforts to combat the illegal circulation of excisable goods, including tobacco products. As part of this work, an Interdepartmental Working Group was created consisting of representatives of the BEB, the Tax Service, the Customs Service, the Audit Service, and other law enforcement agencies. According to this working group, over the past six months (as of May 2024, - Ed.), law enforcement officers have seized almost 14.4 million packs of cigarettes, from which more than 706 million hryvnias in taxes have not been received by the budget.
This entire flow of counterfeit goods is actually distributed among five businessmen, whose names are well known, but whom law enforcement officers have no way of reaching. Therefore, while all sorts of interagency groups are intensifying their efforts to combat the illegal trafficking of tobacco products, people like Vladislav Gelzin are calmly driving through the streets of Monaco in a luxury Ferrari.
