Post Office Sidesteps Fray on Illicit Sales of Cigarettes
By MICHAEL COOPER
May 29, 2005
ALBANY, May 26 – As they move to thwart the illegal trade of cigarettes over the Internet, state officials have joined colleagues from around the nation in persuading the major credit card companies to stop processing payments for online cigarette sales. Additionally, the state has enacted a law prohibiting the shipment of cigarettes to its residents and banned private carriers, like FedEx, from shipping cigarettes.
But as state officials fight illegal online cigarette sales, one operation is not falling into line – the United States Postal Service, which officials say delivers the bulk of illegally purchased cigarettes to New Yorkers.
The Postal Service, citing concerns about the privacy of the mail and wary of putting postal clerks in the position of deciding which packages to accept and which to reject, is resisting the growing calls that it stop shipping cigarettes.
Its stance is exasperating law enforcement officials. “It is outrageous that the federal government – through the United States Postal Service – is knowingly acting as the delivery arm for these criminal enterprises,” New York’s attorney general, Eliot Spitzer, said in a statement.
The role of the post office in shipping illegally sold cigarettes is also attracting attention across the nation. Last month the National Association of Attorneys General asked the Postal Service to “adopt a firm policy prohibiting transportation of packages that the carrier knows or reasonably should know contains cigarettes sold illegally on the Internet.” In Oregon, an online cigarette seller was charged in January with unlawful distribution of cigarettes and racketeering; the post office was not charged but was named in the indictment as part of the racketeering enterprise. Congress has considered legislation that would ban the mailing of cigarettes.
Postal officials say that they are committed to fighting illegal activities conducted through the mail, but complain that their hands are tied. They note that Priority Mail, which officials say is most frequently used to ship cigarettes, cannot be inspected without a search warrant or the consent of either the sender or the recipient.
The post office’s investigative arm, the Postal Inspection Service, has worked to stop illegal cigarette shipments in a number of cases, but has only about 1,970 inspectors in the whole country, charged with investigating everything from the anthrax mailings to all suspicious packages to the distribution of child pornography. And postal officials say that postal clerks cannot be expected to figure out what people are shipping, and whether cigarette retailers are complying with obscure laws like the Jenkins Act, which requires cigarette sellers to keep lists of customers for tax collection purposes.
“Tobacco is a legal, mailable product,” Mary Anne Gibbons, the Postal Service’s general counsel, wrote last month in a response to the association of attorneys general. “It would be impracticable for postal acceptance clerks to make determinations on any given mailer’s compliance with state excise or tax law or Jenkins Act filings.”
But state officials reject this argument, pointing out that at least in New York State, public health laws prohibit direct sales of cigarettes by mail. They acknowledge that the state cannot bar the post office, a federal entity, from shipping cigarettes in New York, but say that since online merchants often violate tax laws, shipping their cigarettes violates federal mail fraud statutes and therefore should be stopped.
“Instead of complying with federal law, the Postal Service is taking a head-in-the-sand approach, by claiming that they have no idea what is in the packages being delivered – even if they are being mailed by Internet operators that sell nothing but cigarettes,” Mr. Spitzer said in a statement. “That is an absurd argument that we would never accept from a private defendant.”
And several law enforcement officials said that in small upstate communities like Salamanca, N.Y., which are dotted with smoke shops advertising the tax-free cigarettes sold from Indian reservations, the post office willingly accepts delivery of truckloads of cartons of cigarettes for delivery.
