Hookah tobacco worth millions: court sentences organizers of illegal business

 An Odesa court has sentenced the members of a criminal group, who organized the illegal sale of hookah tobacco on an industrial scale, to 4 years of imprisonment with a ban on working in the sphere of circulation of excisable goods.

During the pre-trial investigation, detectives of the Territorial Office of the Economic Security Bureau of Ukraine in the Odesa region established that one of the suspects organized a wholesale purchase scheme with subsequent retail distribution in kiosks and via the Internet of illegally manufactured hookah tobacco.

He involved two trusted individuals in the illegal activity. The organizer was responsible for finding suppliers and distribution channels within Ukraine, formatting orders, purchasing, and transporting the tobacco, as well as setting prices.

One of the accomplices was engaged in creating and administering online stores on Instagram and Telegram. Through them, the suspects promoted the assortment of hookah tobacco and accepted orders from buyers.

Another member of the group handled financial settlements with suppliers and kept track of expenses, including room rentals, utility services, and payouts to the participants of the scheme.

For conspiracy purposes, the group members used closed chats in the Telegram and Viber messengers. The sale of hookah tobacco was carried out through retail kiosks and by mail.

During their illegal activity, the suspects received illicit profits from the sale of excisable goods, which they subsequently laundered. To do this, one of the suspects opened bank accounts into which money from the illegal activity was deposited. The total amount of laundered funds is UAH 6.4 million.

During an authorized search at warehouses in Odesa, detectives seized 203 kg of illegally manufactured hookah tobacco, as well as unlabelled bags of tobacco. The seized products do not comply with quality standards. To ensure the reimbursement of damages caused within the criminal proceedings, property worth UAH 3.2 million was seized under court order. Additionally, each of the suspects voluntarily transferred UAH 300 thousand for the needs of the Armed Forces of Ukraine.

The court found all three suspects guilty of committing criminal offenses under Part 2 of Article 28 (commission of a crime by a group of persons), Part 1 of Article 204 (illegal manufacture, storage, sale, or transportation for sale of excisable goods), and Part 1 of Article 209 (legalization (laundering) of proceeds from crime) of the Criminal Code of Ukraine.

Each participant in the criminal scheme was handed a 4-year suspended prison sentence with a 1-year probation period, a fine of UAH 110 thousand, and the confiscation and destruction of the illegal products. Additionally, the defendants are prohibited from working in the sphere of circulation of excisable goods for a period of one year.

The prosecution in the criminal proceedings was supervised by the Odesa Regional Prosecutor's Office.