The United States Department of Justice announced today that it has fined a manufacturer of cheap tobacco, a product that is used widely to sell tobacco, for violating federal tobacco laws.
In January, the Justice Department levied a $5.9 million fine against Reynolds American for selling cigarettes at a price above the mark, a violation of federal law.
The DOJ also announced the seizure of more than 1,500 tobacco plants that were sold illegally, including a shipment of more 20,000 cigarettes.
Reynolds American said it was cooperating fully with the Department’s investigation.
The company said it plans to appeal the fine.
The DOJ investigation began in March 2015, when a team of federal prosecutors investigated a shipment from a Virginia manufacturer, and its owner, to an address in Virginia.
The Department says the shipments originated in China, where they were made to be sold in stores.
The company’s business in Virginia was suspended in May of that year, and the DOJ began its investigation.
According to a press release from the DOJ, the investigation found that Reynolds American was aware of the sale of cigarettes at the wrong price for several months.
The shipment contained approximately 80,000 unopened boxes of cigarettes, which were sold at a mark-up of $12.75 a pack, the release said.
The unopened cigarettes were later resold on the street at an inflated price of $24.80 a pack.
The investigation also found that the company made fraudulent claims about the quality of the tobacco and its ability to deliver cigarettes, including claiming that its product could reduce the risk of lung cancer.
The department says that false statements by Reynolds American and other manufacturers have resulted in tens of thousands of dollars in consumer harm and tens of millions of dollars lost to tobacco sales.
According the DOJ’s press release, Reynolds American is a small tobacco company that makes cigarettes, cigarillos, and chewing tobacco.
The government says it has not recovered any profits from the sale or other use of the cigarettes.