Tobacco Facts.

Four cigarette distribution and manufacturing companies have been raided, including one in north Mississippi, in the last two months as authorities continue a two-year investigation into an alleged tobacco black market.

Besides the Magnolia State, the black market network is believed to have ties to South Carolina and Kentucky, according to an FBI statement released Friday.

On May 26, a task force of federal, state and local law enforcement agents searched Global Distributing in Tupelo. The most recent raid was conducted Thursday at Holley Sales Group, a distribution company in Anderson, S.C. The FBI did not disclose what, if anything, was seized in those searches.

While the investigation has not yielded any arrests, “a number of subjects have been interviewed,” the FBI statement said.

On April 14, the task force discovered more than 14,000 cases of contraband cigarettes worth millions of dollars in a warehouse in an undisclosed location in Mississippi. It was the largest contraband bust in U.S. history, according to the state auditor’s office.

“We uncovered an intentional effort to defraud the taxpayers of Mississippi,” State Auditor Stacey Pickering said. He estimated the unpaid state taxes on the cigarettes at about $5 million, given that Mississippi’s cigarette tax was increased recently from 18 to 68 cents per pack. Unpaid federal taxes could be millions more.

“During this tough economic time, every dime matters,” the auditor said. The state collected about $58.3 million in cigarette excise taxes last fiscal year, according to the State Tax Commission.

Now, the auditor’s office and the Tax Commission are working together to draft legislation that would allow the state to seize the cigarettes and sell them to recover those lost taxes.

“Under the current law, we can sell the cigarettes at auction. But the problem is that the law was not written to anticipate something of this magnitude,” Pickering said. “An example is that, under the existing law, if a dealer bought the cigarettes at auction, the state tax stamp would have to be affixed before they left the state’s custody. In this case, we’re talking about 30 to 32 18-wheeler truckloads.”

The logistics of stamping each box is not practical, he said. “The new legislation would simplify the process.”

Pickering said he’s hoping the legislation will be taken up by lawmakers when a special session is called sometime this summer. The governor determines the agenda of a special session.

“We can’t afford to wait until next year. Cigarettes do have a shelf life,” he said.

David Harper, special agent in charge at the New Orleans branch of the Bureau of Alcohol, Tobacco, Firearms and Explosives, said trafficking in contraband cigarettes appears to be a growing crime.

“This task force was formed specifically to prevent criminal networks from profiting and flourishing from tax evasion through the interstate transportation and sale of contraband cigarettes,” Harper said in a written statement. “ATF has seen significant increases in this type of fraud. Dismantling the head of an organization will have a huge impact, but the best way to address this problem is by attacking the entire network.”

The investigation into the network is ongoing, and officials say more raids are possible.