Featured News Opinion Why illicit trade is thriving amid the pandemic, and what we can...

Why illicit trade is thriving amid the pandemic, and what we can do about it

As more people shop online due to COVID-19, illicit trade, which includes counterfeit vaccines, fake masks, pesticides and more has found fertile ground to peddle goods.

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By Shane Britten

For more than a year now, the land links between Singapore and Malaysia have transformed from among the world’s busiest border crossings into empty and quiet lanes.

But although the pandemic has seen the movement of people across countries nosedive to unprecedented levels, it has not ended the illegal movement of goods. In fact, quite the contrary.

On 7 Jun 2021, seven lorries crossed into Singapore from Malaysia in quick succession. They were purportedly transporting live chickens into Singapore. But there was something suspicious about the vehicles.

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The focused and diligent border officers in Singapore found something more foul than fowl. Hidden in the cabin passenger seats of the seven lorries, all Malaysian-registered, were thousands of electronic vaporisers and related items.

The drivers, all Malaysian men, were told to smuggle these banned products into Singapore before delivering them to a designated location in the country. There was an astounding total of almost 55,000 pieces of prohibited goods.

Such brazen attempts are not unique to Singapore and Malaysia. In these unparalleled times, where quarantines and travel restrictions are becoming commonplace, there is increased cooperation among criminal syndicates who previously have not had reason to work together.

Nations are cooperating to manage these financially difficult times, and so are criminals. New opportunities to exploit existing transfer and importation pipelines are becoming even more appealing, and that should make us all concerned.

Taking advantage of a crisis

On the surface, the border closures brought on by COVID-19 have made it harder for illicit trade. But dig deeper, and you can see that this is unfortunately incorrect.

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The ongoing global pandemic has led to deep economic recessions, higher unemployment and devastating business losses in many countries. With the wages of many affected, consumer spending has reduced.

This means people are becoming more discerning in how they spend their disposable income. They may still want the goods they have always enjoyed, but they are no longer able, or keen, to pay the same prices.

Illicit goods meet this demand, by not paying government taxes and relying on cheaper manpower, which can include human trafficking and modern slavery.

Some areas most impacted are alcoholic drinks and tobacco because of the higher excise taxes on these goods. But the list is a long one, including beauty and personal care products, luxury goods, and personal protective equipment.

In Asia-Pacific, as more people shop online due to COVID-19, illicit trade has found fertile ground to peddle goods. This includes counterfeit vaccines, fake masks, and even pesticides. Many of these problems are being advertised and sold via social media platforms, messaging services like Telegram and WhatsApp and the dark web.

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When there is money to be made, criminal syndicates are incredibly creative and resourceful in finding new methods of smuggling, alternate distribution channels and even innovate with new supply chains.

As noted by Europol, “communities, especially vulnerable groups, tend to become more accessible to organised crime during times of crisis. Economic hardship makes communities more receptive to certain offers, such as cheaper counterfeit goods or recruitment to engage in criminal activity.”

The World Economic Forum estimated that over US$2.2 trillion, which is about 3 per cent of global GDP, was lost due to illicit trade leakages in 2020.

No free lunch

To combat illicit trade, especially during times of global hardship like the COVID-19 pandemic, there has to be both consumer discipline and also enforcement from the authorities.

For the individual consumer, it is usually difficult to see beyond your immediate circumstances. During this recession when many are prioritising spending on essentials like food, housing and medicine, it can be hard to say no to cheaper illicit goods.

But it is useful to remember that there is no free lunch. When you pay less for a product, it does not mean that there are no victims, or that the only victims are the companies whose items are being stolen, replicated or imitated.

Most of the time, someone else is paying the price, either through forced labour, or where the same smuggling channels are used for far more damaging items such as narcotics or firearms.

Government agencies must remain on top of their border controls too. At a time when attention is on controlling the pandemic, border controls must not lose sight that criminal syndicates remain hard at work to distract and smuggle.

And to be effective, the enforcement must be backed up by strong legislation. The above incident of the Malaysian smugglers is instructive. Of the 14 men arrested and charged, the maximum sentence was a jail term of up to two months.

Because existing Singapore laws do not give the authorities the power to confiscate the vehicles when it comes to smuggling electronic cigarettes, the seven lorries were sent back to Malaysia. This is nothing more than a slap on the wrist. Stronger deterrence is required to ensure there are fewer similar attempts.

The battle of the pandemic is not only limited to the screening of the deadly virus and its carriers. It is also a fight against criminals looking to exploit this unprecedented event for profit at the cost of our communities. We should not let them succeed. /TISG

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Shane Britten is the CEO of Crime Stoppers International, a global non-profit organisation to educate communities about transnational crime.

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