Smoke and mirrors: Key tobacco players battle it out over commission of inquiry

Smoke and mirrors: Key tobacco players battle it out over commission of inquiry

The gloves are off for key players in the tobacco industry as the battle for the largest share of the market heats up.

Getty Images

The Fair-Trade Independent Tobacco Association (Fita) has accused its competitors of dodging accountability over serious allegations levelled against them.

This comes after British American Tobacco SA (BATSA) was implicated in a damning report by the Organized Crime and Corruption Reporting Project.

The report found that the multinational smuggled billions of cigarettes through Mali to the western and north-central African regions.

According to the report, the profits from the illicit trade fuel the bloody struggle between jihadists, armed militias, and corrupt military officers, turning northern Mali into a lawless warzone.

The report further pointed out that the bulk of the illicit cigarettes could be traced back to BAT's South African factories.

The multinational has denied the claims.

BATSA's General Manager Johnny Moloto says the company is open to a commission of inquiry to clear its name.

"This is an issue of utmost national importance that is taking huge sums out of the pockets of South Africans and putting it in to the pockets of criminals every single day. It deserves a fully resourced investigation or Commission of Inquiry with real powers."

Moloto says he's confident” that such an investigation would pay for itself by identifying the culprits behind the illegal trade, prosecuting them and shutting down the illegal market to return billions in lost taxes to the fiscus.

"BATSA will cooperate fully with this proposed major investigation. We are fully tax compliant; SARS conducts regular inspections of our factory as part of new production-counter rules," Moloto adds.

"SARS knows that every cigarette BATSA produces can be accounted for, where it is made and where it is going. We urge SARS to ensure that other manufacturers are just as transparent and compliant."

Listen to Johnny Moloto below:

But Fita's chairperson Sinenhlanhla Mnguni says the call for an inquiry is all smoke and mirrors.

"This is yet another unsurprising and calculated effort to deflect attention away from very serious allegations levelled against them by BATSA. To simply brush-off a report implicating your organization in smuggling, corruption, the indirect funding of terrorism and the drug trade smacks of arrogance of the highest degree.

"There is clearly no need for a costly and protracted commission of inquiry, which will only serve to waste taxpayer money and time. The SAPS and other law enforcement agencies simply need to investigate all allegations out before them. The evidence is readily in this regard available, as is the evidence implicating BAT in other acts of wrongdoing.”

He accuses BATSA of another cover up in 2016 when the multinational was accused of money-laundering, espionage and corruption.

"We saw similar tactics employed in 2016 when evidence surfaced, via a massive data leak, implicating BAT in a host of shenanigans such as money-laundering, espionage and corruption. Perhaps they can share the findings of that independent investigation given their eagerness to play open cards," Mnguni says.

"While the multinational fees it can call the shots when it comes to some given their financial muscle, we will never dance to their tune. We continue to urge them to find their conscience and account for the allegations levelled against them much in the same manner FITA members have accounted for past transgressions."

He also maintains that Fita members have a clear conscience.

The tobacco industry continues to pose a major challenge with law enforcement struggling to nip it in the bud.

The illicit trade of cigarettes sees the government losing billions in tax revenue every year.

The South African Revenue Service (Sars) recently announced its efforts to crackdown on tax evasion.

Listen to Sinenhlanhla Mnguni below:

Listen to more local news below Jacaranda
Jacaranda FM

Show's Stories