Local smokes are finding their way into Quebec and police there are cracking down, reports QMI Agency's 24 Heures Montréal.
More than 200 officers from the RCMP, provincial and local police raided 22 convenience stores, 16 homes, 13 vehicles and some smoke shacks Wednesday in the Montreal area, Laval, Victoriaville, Lachenaie and Pincourt.
Tobacco products siezed by police were alleged to have originated on Tyendinaga Mohawk Territory. Police said 17 people face a slew of charges including fraud, conspiracy and concealment.
The owners of the targeted convenience stores will face sanctions under tobacco tax laws.
Police do not believe the network is linked to organized crime.
The contraband was supplied by distributors in the Tyendinaga Territory, but the name of the distributor was not released. No sales tax was collected on the tobacco, police said.
The stores had to order a certain number of legal cigarillos in order to help camouflage the purchase of the products, police said.
Customers of the stores would have had no idea that the product was contraband because they were not offered any rebate on the price and the products were not marked, police said.
"They were all legit products, they were not counterfeit," said Montreal police Insp. Bernard Lamothe.
Montreal police said this was the first time they launched an investigation into cigarillos.
Lamothe said it is much more difficult to keep track of contraband cigarillos, since - unlike cigarettes - they do not bear a government stamp indicating the provincial tax has been paid.
The convenience store network sold up to $150,000 of tobacco products each week, police allege.
They estimate the scheme cost the province $5.2 million in lost tax revenue.