Surprise Raid Nets Players in Duty-free Smuggling Ring

On the morning of March 1, 2006, the Romanian Financial Guard raided a duty-free shop in Moldova Veche suspected of ties to an international organized crime group specializing in tobacco smuggling. The surprise visit was part of a months-long police surveillance of duty-free shops in Caras-Severin County. It revealed an elaborate network involving local and national politicians, customs officials, border police and Serbian sailors.
         According to an October 2006 indictment, the smuggling network was headed by Omer Radovancovici, a powerfully connected official within the Democratic Party of Romanian President Traian Basescu and mayor of Pojejena, a small village on the banks of the Danube near the border crossing of Moldova Noua. Radovancovici controlled the operation through officials at several duty-free companies in the harbor area along the border. George Lupu, an employee at SDV Free Tax Company, oversaw the daily operations of the network and collaborated with associates at GFS Duty Free Romania, Santo International, A.V.A. Tour, and Distribution General Value. Employees at the stores had cultivated relationships with ranking officials at the Naidas Customs Office Bureau and Caras-Severin Border Police Inspectorate, including customs officer Gheorghe Milutin, commissioners Nicusor Cucoana and Dorin Praja, and Border Police Chief Ion Cionca.   
         With Cionca's permission, Lupu and other duty-free company employees coordinated the purchase of large quantities of cigarettes from area duty-free stores. The cigarettes were then either smuggled into Romania to be sold at local markets and fairs throughout the country, or sold to Serbian sailors who smuggled the cigarettes themselves across the Danube by boat.
         Sales records seized by the Romanian Financial Guard in the March 2006 raid of the duty-free shop where Lupu worked attributed the sales of hundreds of thousands of cigarettes at a time to individuals crossing the Romanian-Serbian border by boat. In late February, 2006, seven persons passing through Moldova Veche harbor on the ship “Ana” were listed as having been sold 582,250 packs of cigarettes. Automated records indicated that the purchases had been made at multiple stores only seconds apart. The volume of cigarettes purchased also far exceeded the ship's capacity. When asked about the cigarettes, the seven individuals listed in the sales records denied having purchased them.
         In a separate joint operation on May 13, 2006, Serbian and Romanian authorities discovered 75,000 packs of cigarettes hidden in a ship as it crossed the Danube. The cigarettes were alleged to have been sold in bulk through Radovancovici's network to Serbian sailors.
         By the end of October 2006, the Caras-Severin Office of the Department for the Investigation of Organized Crime and Terrorism indicted 29 members of the criminal network, including Radovancovici, Lupu, Milutin, Praja and Cionca. In an unusual move, Caras-Severin prosecutors divided the case into two files. The first comprised Radovancovici and his conspirators employed by the duty-free shops. The second handled the corrupt customs officials, including Milutin.
         Prosecutors established that the group had smuggled €2 million worth of cigarettes.
         Cionca and Praja were sent before the Court of Law in October 2007. Their trial is ongoing.
         Radovancovici was recently released from prison after serving a sentence of one year, and currently faces additional charges. Reached for comment last month, Radovancovici said, “You can write whatever you want, nobody can do or say anything against me.”
         Radovancovici was re-elected mayor of Pojejena in June.