Tobacco company fined for Canadian smuggling scheme

The United States government has fined an affiliate of the R.J. Reynolds tobacco company $15 million, for its role in a scheme to smuggle cigarettes into Canada.

The "Export A" cigarettes were made in Canada, then moved to the U.S. under the pretext they would be exported to eastern Europe.

Instead, they were smuggled back into Canada through the Akwesasne reserve near Cornwall, Ontario. This happened in in 1994 and 1995, and helped the company avoid paying millions of dollars in taxes in both countries.

The company, called Northern Brands, pleaded guilty in a U.S. Federal Court in New York State to evading millions of dollars in excise taxes.