BBC Panorama (1953) s59e10 Episode Script
Smoking and the Bandits
ã15 billion a year is lost through tax evasion.
One of the biggest contributors is the illicit tobacco trade.
I just bought it.
A butcher is targeted by Revenue and Customs.
He's been selling illegal cigarettes.
He's lying.
The rest is disguised in egg boxes.
Not a penny of tax has been paid.
He's at the bottom end of a multi-billion pound global criminal industry.
Tonight, we'll take you to the top.
If you don't open the door, we're going to force it.
Everybody knows Britain's in debt.
And with few signs of the hard times abating, the country needs every penny it can get its hands on.
Targeting tax cheats is key to clawing back some much-needed cash.
Tonight, with secret filming and exclusive access to Her Majesty's Revenue and Customs' investigators, we'll take you to the heart of the criminal supply chain of the international tobacco trade.
The area of the illicit tobacco trade that my teams are involved in Michael Connolly is Customs' Head of Specialist Investigations for Scotland, Northern Ireland and the North of England.
He's seen the illicit tobacco trade explode over the years, from a criminal cottage industry to a crime of global proportions.
Initially, it started out with holiday-makers going abroad, bringing back the extra 200 cigarettes the white van man going over through the southern ports.
It then escalated further up to containers .
.
roll-on roll-off vehicles through the ports.
We had officers based in airports, we had scanner machines, x-ray machines.
It was just someone trying to get one over on the tax man.
But getting one over on the tax man has now taken a more sinister turn.
The UK is the second most expensive place to smoke in the world.
That's because 80% of the price is tax.
Taking advantage of this are organised crime gangs.
They're putting themselves at the heart of the illicit tobacco trade.
And that means these Customs' officers are now on the frontline of a global battle.
Today, they've received intelligence that a major crime gang may be running a counterfeit cigarette factory from a series of flats in the heart of Glasgow.
The next operation is a race against time to stop the tobacco from reaching the streets.
You got a good feeling about today, Norma? Oh, I don't want to tempt fate.
It looks good, it looks really good.
But you just don't know, do you? Already in place, the first team of officers.
Well, that's it there, isn't it? Sierra seven to all call signs, just be aware of our general location and the high rise buildings we are situated near.
Can you see any movement from the back of the flat? The illicit tobacco trade is worth billions, and the officers know from experience, there is every likelihood they'll be met with resistance.
'There is now an IC5 male came out of the flat, standing on the first landing.
' So there's somebody in there.
Yeah.
'Sierra eight, move to the back door and we'll be right behind you.
' What we'll do is just wait until they've actually gained access to the premises before we move.
Hello, this is Customs.
KNOCKING ON DOOR Hello, it's Customs.
Can you open the door? 'Can you contact the responsible officer for authorisation of the writ?' Revenue and Customs.
Will you come to the door, please? Are you calling for the writ? Yeah.
Norma Rough calls Michael Connolly for permission to use a writ of assistance.
It's a powerful and unique piece of legislation, allowing Customs to gain access to a property in a situation where the goods may be destroyed or removed in the time it would take to get a search warrant.
Sierra one, go ahead.
Access using the writ, over.
Copy that.
Hello.
This is Customs.
If you don't open the door, we're going to force it.
Can you come to the door, please? At the last moment, the door opens.
Hi, there.
How are you doing? We're Customs' officers.
Can we come in and have a word with you? Can you tell us your name? Michael.
Michael, OK.
Telltale signs on the table.
Michael, whose tobacco is this? I don't know.
I just come here, sleep here last night, so I don't know.
Is there any other tobacco in the house? I don't know.
HE KNOCKS ON DOOR TRIES DOOR HANDLE Right, see if you don't give us a key, we're going to break the door down.
So you'd better get the key.
I don't have key.
You can break it.
Right, OK.
Customs believe that behind this locked door is all the workings of a counterfeit cigarette factory.
More than half of all hand-rolled tobacco smoked in the UK is either fake or smuggled with no tax being paid.
So is one in every five cigarettes.
It's a massive loss to the Treasury.
Inside, dozens of boxes.
All the paraphernalia of a large-scale tobacco factory is here.
Every sign points to it having come from China.
Inside industrial-sized bags of Chinese tea, raw tobacco.
These tobacco factories have two or three Chinese gentlemen in them who are getting raw tobacco either through postal depots, through van loads or through concealments via the ports, which will then be delivered into their tenement block, into their flat and they'll sit on the floor, putting that into counterfeit packets of Golden Virginia.
They're eating their dinner, they're having their lunch, they're clipping their nails, brushing their hair, it's all going on the carpet.
So that they don't lose any of the tobacco, they sweep it up back onto there.
So you could be walking out in dog's dirt in the street and somebody ends up on the street smoking it.
People think this is a small tenement flat and they see my officers seizing 600 kilos of hand-rolling tobacco.
Now, that's only one of three that we took out in the last two months.
If our officers hadn't put those operations - taken them out - then that would have continued for a year, the Treasury would lose ã1.
5 million a year, from each of these tobacco factories.
So it's not small-time.
The gang has even counterfeited the tax stamps.
It's the same numbers on them, see the 7069.
615kg of counterfeit tobacco is seized by Customs.
That's a UK tax loss of ã104,000.
I went to Newcastle to meet a man who knows more than most about the international illicit tobacco trade.
Having made contact with some of the bigger crime gangs, Dr Rob Hornsby has watched at close quarters as they've gained a foothold in the UK.
If you go to 2000 .
.
we see from the statistics that 80% of all seized goods - tobacco goods, cigarettes - were genuine brands.
Mostly UK brands.
By the time we get to 2010, in the ten year period, we find the genuine brand scale of the contraband market, the illicit market, has reduced to 6%.
So that's a 74% reduction in seizures of genuine brands.
We now see that counterfeit cigarettes make about a 47% share of the illicit market.
So it's no longer just a crime of tax not being paid on genuine tobacco brands.
Half of all illegal tobacco in the UK is now counterfeit.
Most of it is produced in China.
These pictures show the lengths the criminal counterfeiting gangs will go to.
Buried deep beneath the earth, through a make-shift trapdoor, is a cigarette factory.
One of 22,000 purpose-built counterfeit dens discovered in China in the last few years.
Flooding the world with unregulated tobacco.
Processed in squalid conditions, this tobacco is then packaged up in concealments and posted around the world.
The former commander of Scotland Yard is Roy Ramm.
He also headed up the force's Serious and Organised Crimes Unit.
Throughout his 30-year career, he witnessed the emergence of the tobacco gangs, from small-time smugglers to global criminal institutions.
This is as international as organised crime gets.
The links around the world are exactly the same for this as for drugs trafficking, arms trafficking, people trafficking.
In many ways, it's even more sophisticated because there's counterfeiting going on, there's the manufacture, not just of the tobacco, but of the wrappings, of the Customs' seals, of the revenue tags that are put on to packets of cigarettes.
This is very cleverly done.
The goods will be distributed within one or two hours of hitting their destination mark by road haulage into an industrial unit, bust up, sorted, into back of white vans, up and down the country.
Then, from there, sold on to other retailers.
So what are you talking? Markets, shops, street sellers? Markets, shops, street sellers, factories, work places, universities.
So, when I go to my corner shop and I buy cigarettes, how do I know I'm getting real? You don't.
That's for Revenue and Customs to knowwhich is which.
If they're good-quality counterfeits, they'll taste like the real thing.
The picturesque seaside town of Ayr.
One of the most lucrative selling points for the gangs is open-air markets.
Always busy, filled with buyers looking for a bargain, and, importantly, cash-only trade.
Fertile ground for the tax evaders.
We were tipped off about a criminal tobacco gang operating outside Ayr Market.
Using hidden cameras, we film them for several weeks.
This is Alan Higgins.
Convicted thief.
The man selling is John Scullion.
And this man, always seen on the telephone, is Richard Grant.
Convicted fraudster with violent associates.
I keep seeing money changing hands.
Scullion seems the only one on public display.
Any interaction between the gang is kept to a minimum.
The others remain furtive .
.
appearing almost invisible to the unsuspecting public.
To try and understand the dynamics of this criminal gang, I ask Roy Ramm to talk me through the footage.
You see your man there doing a transaction.
This is your man Scullion on the left.
He's selling to this lady.
It's hard to see here, but it looks like a pack of cigarettes.
Over comes Higgins, your second man.
Higgins is taking some cash away from Scullion and it's a lot of money.
So Higgins is now coming back over once again to hand the cash over.
Yeah, he's coming over.
It's a management chain, isn't it? You know, he's the cashier, he's taking the money.
He's giving it to this guy.
There's probably a discussion going on here about, you know, how much stock have you got, what do you need? There's only so much that Higgins can carry about his person, only so much that Scullion can hold, so somebody's going to bring more stock to the market.
At the rate he's doing transactions, Scullion's pockets would have been emptied ages ago.
Look at the wads of cash he's taken off him.
They keep their cigarettes and tobacco up their sleeves and in their jackets.
You can see the arms His jacket's absolutely bulging, isn't it? He's feeling around himself.
Oh, there we go.
This is not Robin Hood and his band of Merry Men.
What you're seeing here is organised crime.
On the fourth week of secretly filming the gang, we catch on camera something rather odd.
Watch what he does here.
With the money Higgins has taken from Scullion all neatly rolled up, he gives a quick backward glance and throws it onto a nearby roof.
If you missed it, here it is again.
Minutes later, with Higgins' back turned, Scullion does exactly the same thing.
That'svery odd.
On this morning, the telephone man, the money man hadn't turned up.
What it could be is that they are creaming off some of the money for themselves.
There is no honour amongst thieves.
I suspect that he's stealing from the company.
What you're seeing is money being sucked out of the revenue.
This is undermining the tax system and, whether you're a smoker or not, you and I and everybody else are paying for what these people are doing.
We are funding organised crime.
In order to find out who's behind the supply chain, I have to buy from the gang.
Scullion charges me ã3.
50 for 20 cigarettes.
Half what they should be.
And ã6.
50 for the tobacco.
I should be paying more than 12.
I notice a rather familiar number on the pouch.
It's the same fake tax stamp code which Customs found in the Glasgow flat.
This paperwork trail directly links the gang in Ayr with a major, organised Chinese crime group.
We sent all the tobacco products we'd bought from the Ayr gang to an independent laboratory for testing.
The results make for sobering reading.
Levels of lead in the Golden Virginia are 30 times that found in a genuine pouch of the tobacco.
And in the fake Marlboro Reds, the levels of lead are 17 times that found in the genuine product.
In some of the other products, arsenic and cadmium, the other deadly toxins, are also very high.
In some cases, six times the normal amount.
So, what the gang in Ayr is selling is not only counterfeit, not only supplied by a major criminal Chinese gang, but it's also highly toxic.
And remember, not one penny of tax has been paid.
I arranged to meet one of the UK's leading experts in tobacco-related health.
Professor Robert West agreed to look at our results from the counterfeit tobacco products we'd bought from Ayr.
I came to this thinking, "Well, illicit tobacco - "how much more dangerous can it be?" Well, probably quite a bit.
I think your results are quite striking.
For example, Golden Virginia tobacco bought from a supermarket, you get really trace levels, very low levels of lead.
In the counterfeit sample that you have analysed, it's 30 times that.
So it's equivalent to smoking 30 cigarettes for every cigarette that you would buy legitimately.
If you actually look at some of the levels, the Golden Virginia tobacco, now, if you were a 20-a-day smoker Well, I think, um .
.
that's 600 legitimate cigarettes you would have to smoke to just smoke your 20-a-day counterfeits.
That's right.
600.
I guess even the heaviest smoker would struggle to achieve that level of consumption.
Are you shocked? Genuinely, are you surprised? I think that I am surprised and I am shocked.
And I think that we're probably looking at a health time-bomb.
We don't know when it will hit, but probably sooner rather than later.
When the health time-bomb does hit, the financial burden on the NHS is going to be huge.
The ã4 billion which the country is losing every year to the illegal tobacco trade could help foot that bill.
It could fund 16 new state-of-the-art hospitals, train 93,000 new nurses.
In fact, it would cover a third of Scotland's annual health budget.
Instead, those billions are going straight into the back pockets of some of the country's biggest crime gangs.
We didn't have to look far for a gang which dwarfed the one we'd filmed in Ayr.
The Barras is one of the biggest open air markets in Scotland.
Both the scale and the audacity of this tobacco gang Billy! Marlboro! .
.
are immediately evident.
Sleeves of 200 cigarettes, sold in their dozens.
The gang goes back and forward to a Rover and a black BMW to stock up.
Nearly all their tobacco products are counterfeit.
Again, I ask Roy Ramm to look at footage of me buying from the gang.
She then offers me a free sample.
"Take it, see if you like it.
Come back for more.
I'm your supplier.
" There are so many similarities between this supply chain and the drugs supply chain that they're almost indistinguishable.
Most people walking around that market have no idea of the sophistication and the level of criminality that sits behind that lady.
Dozens of customers.
Thousands of pounds.
But does any of this cash go into the public purse? Or does it just stay in her pink handbag? She gives them a bag.
It's good of her.
She could easily afford to give them a Versace bag, I suspect, from the amount of money she's making.
Elsewhere in the market, we find business is booming.
So he's charging ã35 for 200, which is almost exactly 50% of what people would be expecting to pay in a shop.
It's a very clever, very sophisticated, highly profitable, low risk operation.
Impressive? Yeah.
Worryingly impressive.
We also had the products we bought from the Barras tested.
They were all counterfeit, all from China, and with exactly the same high levels of toxins as those bought from Ayr.
These are criminal entrepreneurs, and they're market savvy and they're risk savvy, and they're risk averse.
Maximum sentence, seven years.
Well, it's not a great risk, is it? For the profits involved.
Despite signing a legal document agreeing to cease their selling of counterfeit cigarettes, Higgins and his gang continue.
It's time to ask Mr Scullion for our money back.
Listen, actually, I'm from the BBC.
We've been filming you for the past seven weeks.
What we've actually been doing That's that.
If you've bought counterfeit cigarettes from Mr Scullion and you want to get your money back, be quick.
Because he's very fast.
I hadn't even got round to asking for my money back.
That's the quickest refusal for an interview I think I've ever seen.
Next stop, the Barras.
The woman stallholder we've been filming isn't there.
But her sidekick is.
It's just I would like to bring them back because they're fake.
They're counterfeits.
They are? She sold them to me.
No' they ones.
'As I go inside to see what he sells, I'm followed by one of his men.
' I'm actually from the BBC.
We've been secretly filming you for the past couple of months.
'Suddenly it turns violent.
' Screw you, BBC! Screw the BBC.
Get yourself to BLEEP and all, you cow.
What you going to do about it? 'I needed to leave our evidence with them.
' Listen, I'd like to leave this with you.
I need to give you this letter.
BLEEP.
Go away! You and all.
'Things really turn nasty.
' 'Unable to get to me, he goes for the crew.
' Calm down.
Get to BLEEP.
Yeah, I think we should just leave.
As we try to get away, a gang of men surround us and attack the car.
Is everyone all right? The illicit tobacco world and the criminal gangs involved have now been acknowledged as a big problem by the Government.
Revenue and Customs, already making inroads in cutting the criminal market in non-duty paid cigarettes, have just been given ã900 million to deal with tax evasion and other fraud.
A big chunk of that will go towards tackling the growing counterfeit tobacco trade.
But, is it going to be enough? Well, none of us have a crystal ball but there will be a number of market-orientated entrepreneurial villains who can spot a gap in the market and spot demand before others do, and they will exploit it.
One of the biggest contributors is the illicit tobacco trade.
I just bought it.
A butcher is targeted by Revenue and Customs.
He's been selling illegal cigarettes.
He's lying.
The rest is disguised in egg boxes.
Not a penny of tax has been paid.
He's at the bottom end of a multi-billion pound global criminal industry.
Tonight, we'll take you to the top.
If you don't open the door, we're going to force it.
Everybody knows Britain's in debt.
And with few signs of the hard times abating, the country needs every penny it can get its hands on.
Targeting tax cheats is key to clawing back some much-needed cash.
Tonight, with secret filming and exclusive access to Her Majesty's Revenue and Customs' investigators, we'll take you to the heart of the criminal supply chain of the international tobacco trade.
The area of the illicit tobacco trade that my teams are involved in Michael Connolly is Customs' Head of Specialist Investigations for Scotland, Northern Ireland and the North of England.
He's seen the illicit tobacco trade explode over the years, from a criminal cottage industry to a crime of global proportions.
Initially, it started out with holiday-makers going abroad, bringing back the extra 200 cigarettes the white van man going over through the southern ports.
It then escalated further up to containers .
.
roll-on roll-off vehicles through the ports.
We had officers based in airports, we had scanner machines, x-ray machines.
It was just someone trying to get one over on the tax man.
But getting one over on the tax man has now taken a more sinister turn.
The UK is the second most expensive place to smoke in the world.
That's because 80% of the price is tax.
Taking advantage of this are organised crime gangs.
They're putting themselves at the heart of the illicit tobacco trade.
And that means these Customs' officers are now on the frontline of a global battle.
Today, they've received intelligence that a major crime gang may be running a counterfeit cigarette factory from a series of flats in the heart of Glasgow.
The next operation is a race against time to stop the tobacco from reaching the streets.
You got a good feeling about today, Norma? Oh, I don't want to tempt fate.
It looks good, it looks really good.
But you just don't know, do you? Already in place, the first team of officers.
Well, that's it there, isn't it? Sierra seven to all call signs, just be aware of our general location and the high rise buildings we are situated near.
Can you see any movement from the back of the flat? The illicit tobacco trade is worth billions, and the officers know from experience, there is every likelihood they'll be met with resistance.
'There is now an IC5 male came out of the flat, standing on the first landing.
' So there's somebody in there.
Yeah.
'Sierra eight, move to the back door and we'll be right behind you.
' What we'll do is just wait until they've actually gained access to the premises before we move.
Hello, this is Customs.
KNOCKING ON DOOR Hello, it's Customs.
Can you open the door? 'Can you contact the responsible officer for authorisation of the writ?' Revenue and Customs.
Will you come to the door, please? Are you calling for the writ? Yeah.
Norma Rough calls Michael Connolly for permission to use a writ of assistance.
It's a powerful and unique piece of legislation, allowing Customs to gain access to a property in a situation where the goods may be destroyed or removed in the time it would take to get a search warrant.
Sierra one, go ahead.
Access using the writ, over.
Copy that.
Hello.
This is Customs.
If you don't open the door, we're going to force it.
Can you come to the door, please? At the last moment, the door opens.
Hi, there.
How are you doing? We're Customs' officers.
Can we come in and have a word with you? Can you tell us your name? Michael.
Michael, OK.
Telltale signs on the table.
Michael, whose tobacco is this? I don't know.
I just come here, sleep here last night, so I don't know.
Is there any other tobacco in the house? I don't know.
HE KNOCKS ON DOOR TRIES DOOR HANDLE Right, see if you don't give us a key, we're going to break the door down.
So you'd better get the key.
I don't have key.
You can break it.
Right, OK.
Customs believe that behind this locked door is all the workings of a counterfeit cigarette factory.
More than half of all hand-rolled tobacco smoked in the UK is either fake or smuggled with no tax being paid.
So is one in every five cigarettes.
It's a massive loss to the Treasury.
Inside, dozens of boxes.
All the paraphernalia of a large-scale tobacco factory is here.
Every sign points to it having come from China.
Inside industrial-sized bags of Chinese tea, raw tobacco.
These tobacco factories have two or three Chinese gentlemen in them who are getting raw tobacco either through postal depots, through van loads or through concealments via the ports, which will then be delivered into their tenement block, into their flat and they'll sit on the floor, putting that into counterfeit packets of Golden Virginia.
They're eating their dinner, they're having their lunch, they're clipping their nails, brushing their hair, it's all going on the carpet.
So that they don't lose any of the tobacco, they sweep it up back onto there.
So you could be walking out in dog's dirt in the street and somebody ends up on the street smoking it.
People think this is a small tenement flat and they see my officers seizing 600 kilos of hand-rolling tobacco.
Now, that's only one of three that we took out in the last two months.
If our officers hadn't put those operations - taken them out - then that would have continued for a year, the Treasury would lose ã1.
5 million a year, from each of these tobacco factories.
So it's not small-time.
The gang has even counterfeited the tax stamps.
It's the same numbers on them, see the 7069.
615kg of counterfeit tobacco is seized by Customs.
That's a UK tax loss of ã104,000.
I went to Newcastle to meet a man who knows more than most about the international illicit tobacco trade.
Having made contact with some of the bigger crime gangs, Dr Rob Hornsby has watched at close quarters as they've gained a foothold in the UK.
If you go to 2000 .
.
we see from the statistics that 80% of all seized goods - tobacco goods, cigarettes - were genuine brands.
Mostly UK brands.
By the time we get to 2010, in the ten year period, we find the genuine brand scale of the contraband market, the illicit market, has reduced to 6%.
So that's a 74% reduction in seizures of genuine brands.
We now see that counterfeit cigarettes make about a 47% share of the illicit market.
So it's no longer just a crime of tax not being paid on genuine tobacco brands.
Half of all illegal tobacco in the UK is now counterfeit.
Most of it is produced in China.
These pictures show the lengths the criminal counterfeiting gangs will go to.
Buried deep beneath the earth, through a make-shift trapdoor, is a cigarette factory.
One of 22,000 purpose-built counterfeit dens discovered in China in the last few years.
Flooding the world with unregulated tobacco.
Processed in squalid conditions, this tobacco is then packaged up in concealments and posted around the world.
The former commander of Scotland Yard is Roy Ramm.
He also headed up the force's Serious and Organised Crimes Unit.
Throughout his 30-year career, he witnessed the emergence of the tobacco gangs, from small-time smugglers to global criminal institutions.
This is as international as organised crime gets.
The links around the world are exactly the same for this as for drugs trafficking, arms trafficking, people trafficking.
In many ways, it's even more sophisticated because there's counterfeiting going on, there's the manufacture, not just of the tobacco, but of the wrappings, of the Customs' seals, of the revenue tags that are put on to packets of cigarettes.
This is very cleverly done.
The goods will be distributed within one or two hours of hitting their destination mark by road haulage into an industrial unit, bust up, sorted, into back of white vans, up and down the country.
Then, from there, sold on to other retailers.
So what are you talking? Markets, shops, street sellers? Markets, shops, street sellers, factories, work places, universities.
So, when I go to my corner shop and I buy cigarettes, how do I know I'm getting real? You don't.
That's for Revenue and Customs to knowwhich is which.
If they're good-quality counterfeits, they'll taste like the real thing.
The picturesque seaside town of Ayr.
One of the most lucrative selling points for the gangs is open-air markets.
Always busy, filled with buyers looking for a bargain, and, importantly, cash-only trade.
Fertile ground for the tax evaders.
We were tipped off about a criminal tobacco gang operating outside Ayr Market.
Using hidden cameras, we film them for several weeks.
This is Alan Higgins.
Convicted thief.
The man selling is John Scullion.
And this man, always seen on the telephone, is Richard Grant.
Convicted fraudster with violent associates.
I keep seeing money changing hands.
Scullion seems the only one on public display.
Any interaction between the gang is kept to a minimum.
The others remain furtive .
.
appearing almost invisible to the unsuspecting public.
To try and understand the dynamics of this criminal gang, I ask Roy Ramm to talk me through the footage.
You see your man there doing a transaction.
This is your man Scullion on the left.
He's selling to this lady.
It's hard to see here, but it looks like a pack of cigarettes.
Over comes Higgins, your second man.
Higgins is taking some cash away from Scullion and it's a lot of money.
So Higgins is now coming back over once again to hand the cash over.
Yeah, he's coming over.
It's a management chain, isn't it? You know, he's the cashier, he's taking the money.
He's giving it to this guy.
There's probably a discussion going on here about, you know, how much stock have you got, what do you need? There's only so much that Higgins can carry about his person, only so much that Scullion can hold, so somebody's going to bring more stock to the market.
At the rate he's doing transactions, Scullion's pockets would have been emptied ages ago.
Look at the wads of cash he's taken off him.
They keep their cigarettes and tobacco up their sleeves and in their jackets.
You can see the arms His jacket's absolutely bulging, isn't it? He's feeling around himself.
Oh, there we go.
This is not Robin Hood and his band of Merry Men.
What you're seeing here is organised crime.
On the fourth week of secretly filming the gang, we catch on camera something rather odd.
Watch what he does here.
With the money Higgins has taken from Scullion all neatly rolled up, he gives a quick backward glance and throws it onto a nearby roof.
If you missed it, here it is again.
Minutes later, with Higgins' back turned, Scullion does exactly the same thing.
That'svery odd.
On this morning, the telephone man, the money man hadn't turned up.
What it could be is that they are creaming off some of the money for themselves.
There is no honour amongst thieves.
I suspect that he's stealing from the company.
What you're seeing is money being sucked out of the revenue.
This is undermining the tax system and, whether you're a smoker or not, you and I and everybody else are paying for what these people are doing.
We are funding organised crime.
In order to find out who's behind the supply chain, I have to buy from the gang.
Scullion charges me ã3.
50 for 20 cigarettes.
Half what they should be.
And ã6.
50 for the tobacco.
I should be paying more than 12.
I notice a rather familiar number on the pouch.
It's the same fake tax stamp code which Customs found in the Glasgow flat.
This paperwork trail directly links the gang in Ayr with a major, organised Chinese crime group.
We sent all the tobacco products we'd bought from the Ayr gang to an independent laboratory for testing.
The results make for sobering reading.
Levels of lead in the Golden Virginia are 30 times that found in a genuine pouch of the tobacco.
And in the fake Marlboro Reds, the levels of lead are 17 times that found in the genuine product.
In some of the other products, arsenic and cadmium, the other deadly toxins, are also very high.
In some cases, six times the normal amount.
So, what the gang in Ayr is selling is not only counterfeit, not only supplied by a major criminal Chinese gang, but it's also highly toxic.
And remember, not one penny of tax has been paid.
I arranged to meet one of the UK's leading experts in tobacco-related health.
Professor Robert West agreed to look at our results from the counterfeit tobacco products we'd bought from Ayr.
I came to this thinking, "Well, illicit tobacco - "how much more dangerous can it be?" Well, probably quite a bit.
I think your results are quite striking.
For example, Golden Virginia tobacco bought from a supermarket, you get really trace levels, very low levels of lead.
In the counterfeit sample that you have analysed, it's 30 times that.
So it's equivalent to smoking 30 cigarettes for every cigarette that you would buy legitimately.
If you actually look at some of the levels, the Golden Virginia tobacco, now, if you were a 20-a-day smoker Well, I think, um .
.
that's 600 legitimate cigarettes you would have to smoke to just smoke your 20-a-day counterfeits.
That's right.
600.
I guess even the heaviest smoker would struggle to achieve that level of consumption.
Are you shocked? Genuinely, are you surprised? I think that I am surprised and I am shocked.
And I think that we're probably looking at a health time-bomb.
We don't know when it will hit, but probably sooner rather than later.
When the health time-bomb does hit, the financial burden on the NHS is going to be huge.
The ã4 billion which the country is losing every year to the illegal tobacco trade could help foot that bill.
It could fund 16 new state-of-the-art hospitals, train 93,000 new nurses.
In fact, it would cover a third of Scotland's annual health budget.
Instead, those billions are going straight into the back pockets of some of the country's biggest crime gangs.
We didn't have to look far for a gang which dwarfed the one we'd filmed in Ayr.
The Barras is one of the biggest open air markets in Scotland.
Both the scale and the audacity of this tobacco gang Billy! Marlboro! .
.
are immediately evident.
Sleeves of 200 cigarettes, sold in their dozens.
The gang goes back and forward to a Rover and a black BMW to stock up.
Nearly all their tobacco products are counterfeit.
Again, I ask Roy Ramm to look at footage of me buying from the gang.
She then offers me a free sample.
"Take it, see if you like it.
Come back for more.
I'm your supplier.
" There are so many similarities between this supply chain and the drugs supply chain that they're almost indistinguishable.
Most people walking around that market have no idea of the sophistication and the level of criminality that sits behind that lady.
Dozens of customers.
Thousands of pounds.
But does any of this cash go into the public purse? Or does it just stay in her pink handbag? She gives them a bag.
It's good of her.
She could easily afford to give them a Versace bag, I suspect, from the amount of money she's making.
Elsewhere in the market, we find business is booming.
So he's charging ã35 for 200, which is almost exactly 50% of what people would be expecting to pay in a shop.
It's a very clever, very sophisticated, highly profitable, low risk operation.
Impressive? Yeah.
Worryingly impressive.
We also had the products we bought from the Barras tested.
They were all counterfeit, all from China, and with exactly the same high levels of toxins as those bought from Ayr.
These are criminal entrepreneurs, and they're market savvy and they're risk savvy, and they're risk averse.
Maximum sentence, seven years.
Well, it's not a great risk, is it? For the profits involved.
Despite signing a legal document agreeing to cease their selling of counterfeit cigarettes, Higgins and his gang continue.
It's time to ask Mr Scullion for our money back.
Listen, actually, I'm from the BBC.
We've been filming you for the past seven weeks.
What we've actually been doing That's that.
If you've bought counterfeit cigarettes from Mr Scullion and you want to get your money back, be quick.
Because he's very fast.
I hadn't even got round to asking for my money back.
That's the quickest refusal for an interview I think I've ever seen.
Next stop, the Barras.
The woman stallholder we've been filming isn't there.
But her sidekick is.
It's just I would like to bring them back because they're fake.
They're counterfeits.
They are? She sold them to me.
No' they ones.
'As I go inside to see what he sells, I'm followed by one of his men.
' I'm actually from the BBC.
We've been secretly filming you for the past couple of months.
'Suddenly it turns violent.
' Screw you, BBC! Screw the BBC.
Get yourself to BLEEP and all, you cow.
What you going to do about it? 'I needed to leave our evidence with them.
' Listen, I'd like to leave this with you.
I need to give you this letter.
BLEEP.
Go away! You and all.
'Things really turn nasty.
' 'Unable to get to me, he goes for the crew.
' Calm down.
Get to BLEEP.
Yeah, I think we should just leave.
As we try to get away, a gang of men surround us and attack the car.
Is everyone all right? The illicit tobacco world and the criminal gangs involved have now been acknowledged as a big problem by the Government.
Revenue and Customs, already making inroads in cutting the criminal market in non-duty paid cigarettes, have just been given ã900 million to deal with tax evasion and other fraud.
A big chunk of that will go towards tackling the growing counterfeit tobacco trade.
But, is it going to be enough? Well, none of us have a crystal ball but there will be a number of market-orientated entrepreneurial villains who can spot a gap in the market and spot demand before others do, and they will exploit it.