Health group condemns tobacco smuggling settlement

TORONTO, April 13 /CNW/ - The health association that led the campaign to persuade the federal government to sue tobacco companies over tobacco contraband condemned the settlements announced today by the federal government and Big Tobacco.

"The tobacco smuggling in the early 1990s was, at the time, the largest and most destructive fraud in the history of Canadian business and public health," said Garfield Mahood, executive director of the Non-Smokers' Rights Association (NSRA). "In court papers from 2005, the federal and provincial governments filed claims for nearly $10 billion against JTI-Macdonald Corp. and related companies over contraband. The settlement today for $550 million with the companies involved is a complete sell-out amounting to about 6 cents on the dollar."

"The offensiveness of the sweetheart deal does not end there," said François Damphousse, director of the NSRA's Montreal office. "Tragically there is a health component to this affair that the settlement also fails to address. Health Canada's Laboratory Centre for Disease Control predicted in a secret study leaked to the NSRA in 1995 that the smuggling of the 1990s would lead to an increase of tens of thousands of tobacco-caused deaths from the increase in smoking rates among the adolescent population alone. There is nothing in the settlements announced today that will address the tragic health consequences of this criminal behaviour."

"The cave-in almost certainly extends to the resolution of the criminal charges against Big Tobacco," said Mahood. "The federal government is silent on the disposition of the criminal charges against individual tobacco executives, outstanding until at least a few days ago." "But, based on the disposition of the criminal charges against the companies today, it is almost certain that, yet another time, Big Tobacco executives have been given get-out-of-jail-free cards."

"It is difficult to find any elements of these agreements that are praiseworthy. The government claims that the settlements ensure 'that companies in Canada do not profit from illegal activity.' They do nothing of the sort. The settlements prove that tobacco crime does pay, Big Time, as it has for decades. The government settled for 'chump change', in the words of one former tobacco executive. Criminal responsibility, deterrence and justice were bargained away. And there was no attempt made to negotiate health benefits to repair the health damage caused by the criminal behavour, like those obtained in similar-kind negotiations in the United States.

"Canadian governments led by the feds had an opportunity to play hard ball, to build trust among Canadians in the rule of law related to white collar crime. Instead, they blew away the opportunity to recoup billions of desperately-needed lost tax revenues and made Big Tobacco financially stronger, with a greater capacity to prey on our children," said Mahood.

The Non-Smokers' Rights Association is a national health organization with members across Canada and offices in Toronto, Ottawa and Montreal. It is the inaugural recipient of the international Luther L. Terry Award for global leadership in tobacco control.

For further information: Garfield Mahood, OC, Executive Director, Tel: [phone], Cell: [phone]; Melodie Tilson, Director of Policy, Tel: [phone] x3; François Damphousse, Directeur, bureau du Québec, Tel: [phone], Cell: [phone]