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Tobacco Executive Charged

February 27, 1999

SYRACUSE, N.Y. (AP) _ A former R.J. Reynolds marketing executive has been charged with helping smugglers scheme to sell nearly $700 million worth of cigarettes on the Canadian black market.

Leslie Thompson, 51, was arrested this week in Detroit on money laundering charges. If convicted, he could get 20 years in prison.

He is the first tobacco industry executive charged in the federal government’s investigation into tobacco and alcohol smuggling through the St. Regis Mohawk Reservation in northern New York.

The smugglers avoided paying excise taxes to the United States by telling customs agents that the Canadian cigarettes they were carrying were being brought into the country for export to Russia. Instead, they were shipped to the St. Regis reservation and smuggled across the St. Lawrence River back into Canada, thus cheating the Canadian government of taxes as well.

It appeared Thompson was preparing to flee the country when arrested, Assistant U.S. Attorney Gregory West said Friday. Thompson was ordered held without bail. The government also is seeking to seize $87 million in illicit assets from Thompson, West said.

Two dozen people have been convicted in the case and are awaiting sentencing. In December, Northern Brands International, an R.J. Reynolds subsidiary, admitted helping the smuggling ring and paid $15 million in fines and forfeitures.

Thompson was placed on leave after the company began an internal investigation into Northern Brands. Adam Bryan-Brown, a spokesman for R.J. Reynolds, said the allegations against Thompson run ``completely contrary″ to corporate policy.

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