The smuggling of tobacco and cigarettes is becoming more common in the Mohawk Nation territory of Akwesasne near Cornwall in eastern Ontario, according to the RCMP.

Several million cigarettes and tonnes of contraband loose-leaf tobacco have been impounded in the past few weeks alone, said RCMP Sgt. Michael Harvey.

A trailer seized near Akwesasne on Feb. 21 carried 190 cases, "or close to 1.5 million cigarettes," Harvey told CBC News Tuesday.

"We're seeing more and more of these larger trailers, instead of just having trailers that would hold 20 cases."

The RCMP estimates the smuggling is costing the federal government about $2 billion a year in lost tax revenue.

But it's also hurting small businesses in the area because they are being bypassed as the cigarettes flow from about a dozen factories on the U.S. side of the Akwesasne territory.

Chris Wilcox, general manager of 35 Quickie convenience stores in the region, said he has closed one store, and expects to close two more.
 
"We have a little bit of misfortune in being located in the heart of smuggling territory, the Golden Triangle so to speak. All of our stores are located in the corridor from Cornwall to Ottawa and Gatineau, so we're probably in the heart of this problem," Wilcox said.
 
According to the RCMP, most of the cigarette factories have no federal licence to operate, but no one has been able to shut them down.

The location of the Akwesasne territory makes it an attractive location for cross-border cigarette smuggling operations, and a number of large smuggling busts have been made there before.

The territory spans the St. Lawrence River in Quebec, Ontario and New York state.

Akwesasne police Chief Lewis Mitchell has said the territory's reputation suffers as a result of its smuggling problems, but others should share the blame.

"We're constantly getting black eyes for this type of behaviour," he said.

"We have to remember it's organized crime from Montreal, the big cities, coming into our community and exploiting our borders, exploiting our community."