PRESS RELEASE FOR IMMEDIATE RELEASE January 29, 2001 Office of Tax & Revenue Conducts Compliance Checks on Illegal Cigarette Sales WASHINGTON, DC - Early this morning, Herbert J. Huff, Deputy Chief Financial Officer for the Office of Tax and Revenue (OTR), and Captain Kevin Keegan, Commanding Officer of the Metropolitan Police Department's Mobile Force, led a team of personnel that conducted the first round of compliance checks in OTR's stepped up efforts to rid the District of illegal cigarettes. The stepped up enforcement program comes in the wake of legislation passed recently by the DC Council making the sale of "gray market" cigarettes illegal in the District. Gray market cigarettes are cigarettes intended for sale in another country, but are being illegally sold within the United States. The cartons are clearly marked "Not For Sale in the US" or "For Export Only" and contain cigarettes with a different blend of tobacco, resulting in a different taste. This morning's compliance checks focused on distributors providing merchandise to the vendors. The intent of the checks was to help determine merchants' compliance with District legislation. It resulted in the seizure of illegal cigarettes at several locations. The Metropolitan Police Department has taken possession of the illegal cigarettes pending completion of the reviews. The compliance checks also revealed potential violations with other DC agency regulations. Referrals will be made to those agencies for consideration. Cigarette license holders were notified in August 2000 of periodic random compliance checks and were urged to dispose of any contraband cigarettes. Violations carry civil and criminal penalties and/or imprisonment for up to three years. These contraband cigarettes are subject to immediate seizure and forfeiture. Conviction may involve the revocation of the license to affix DC tax stamps. In addition to the Metropolitan Police Department, partners in the enforcement effort to rid the District of the sale of illegal cigarettes include neighboring states; the federal Bureau of Alcohol, Tobacco and Firearms; the DC Department of Consumer and Regulatory Affairs; and the DC Department of Health.