The ESBU has uncovered a scheme involving the illegal production of vapes; assets worth 30 million hryvnias have been seized
Detectives from the Main Detective Division of the Economic Security Bureau of Ukraine have uncovered the activities of a group of individuals who organised the illegal production, storage, transport and sale of e-cigarette liquids. As part of the operation, over 70 searches were carried out at retail, manufacturing and warehouse premises, as well as at the homes of those involved.
The investigation established that, since 2023, a scheme had been operating in Kyiv and the Kyiv region to sell e-cigarette liquids manufactured outside state control. The products were sold through a network of vape shops and online platforms, with delivery throughout Ukraine.
Furthermore, the scheme’s participants evaded taxes on a particularly large scale through a business fragmentation mechanism. The network effectively operated as a single entity, but was formally registered under sole traders and limited liability companies under their control. The proceeds were laundered through financial transactions and presented as income from lawful activities.
The Office of the Prosecutor General, in conjunction with the Economic Security Bureau, established that over 200 people were involved in the operation of the illegal business. Investigative actions were carried out in Kyiv and across the Kyiv, Kirovohrad, Poltava, Cherkasy and Chernihiv regions.
During the searches, significant quantities of excise goods and components for their manufacture were seized. These included over 43,000 flavourings, 30,000 units of glycerine, 36,000 flavour and strength enhancers, nearly 20,000 cartridges, and so on. Raw materials were also seized, including propylene glycol, glycerine and flavourings. In addition, over 70,000 US dollars, computer equipment and rough notes were seized.
The total value of the seized property amounts to approximately 30 million hryvnias. According to investigators’ estimates, the sale of these products could have resulted in the evasion of excise duty amounting to approximately 20 million hryvnias.
As part of the operation, illegal kiosks used to sell the products were also dismantled. The work was carried out with the assistance of the Kyiv City State Administration.
The pre-trial investigation is ongoing. Prosecutors from the Office of the Prosecutor General of Ukraine are overseeing the proceedings.
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