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Peggy E. Chaudhry and Alan S. Zimmerman

This chapter focuses on the illicit trade in tobacco products and particularly key elements of this illicit trade that include 1) the scale of the global illicit tobacco trade and its nature (notably, the distinction that can be drawn between source and destination markets); 2) the various types of illicit tobacco products; and 3) the nature and characteristics of the illicit tobacco trade. A discussion of the recognized sources and destinations of illicit tobacco trade; the criminal gangs behind illicit tobacco trade; the use of packaging as a deterrent to counterfeiters; the role of tax stamps; and the use of Internet sites for distribution is provided. We also present the principal factors contributing to illicit trade in tobacco; specifically: 1) consumer affordability of tobacco products; 2) the profit incentives available to illicit traders; 3) the fact that criminal penalties are low and disproportionate to profit incentives; 4) consumer complicity; 5) the significance of the location of certain countries; and 6) tobacco as the “ideal smuggled product”. Although many of these issues are worthy of individual reports in their own right, analysis at that level of detail is beyond the scope of this chapter.