PUNCHBAGS containing almost 40 kilos of tobacco, thought to be worth around £7,500, have been seized as they were smuggled into the country.

Three punchbags, each containing roughly 12.5 kilos of hand-rolling tobacco, aroused suspicion among staff who received them at a North-East parcel warehouse.

The workers at the Tyneside parcel warehouse contacted HM Revenue and Customs who opened them up.

They were found to be packed full of smuggled hand-rolling tobacco destined for the region's black market.

Each bag contained enough to fill 250 pouches, each of which can be sold for up to £10.

Overall, the street value of the huge haul was around £7,500 and investigations are ongoing into those who arranged for it to be sent to the North-East.

The seizure comes as HM Revenue & Customs (HMRC) officers said there has been a boom in the amount of hand-rolling tobacco seized over the last year.

A spokeswoman said: "The specific problem of illegally imported hand-rolling tobacco is a growing concern across the North-East in particular.

"We are at the forefront of tackling the problem of smuggling, and we have long targeted those who try and flout the importing laws on tobacco goods.

"Traditionally, we have dealt with high numbers of people trying to import cigarettes into the UK but now we have noticed a significant increase in the attempts to illegally import - both duty free and EU duty paid - hand-rolling tobacco."

Staff working at a parcel depot in Gateshead contacted HMRC investigators when they received the three leather punchbags and suspected illegal goods were concealed inside them.

The tobacco was loose and packed inside sheets of white plastic.

Investigators believe the villains behind the crooked cargo may have been planning to package it into pouches, falsely bearing the logos of legitimate brands, and sell them on the black market.

It is estimated that 60 per cent of all hand-rolling tobacco in circulation is illicit and 200 tonnes was seized nationally last year.

One kilo of the tobacco is generally made up of around 20 pouches.

The spokeswoman said: "Hand- rolling tobacco can often be purchased abroad for as little as £3 per pouch. But it can sell on the North East black market for anywhere between £6 and £10 per pouch.

"This might look like a tempting money-making scheme, but we need to get across a strong message to the people who trade illegally in this area.

"HMRC and the UK Border Agency, along with local police forces, are committed to stamping out this problem. We are dedicating time and resources to detect the people behind this trade in the North-East.

"Smuggling crime carries serious penalties. If you are found guilty of the offence, you could be facing up to seven years in prison.

"I also want to send a clear message to the people who buy this illegal, duty free product in pubs, clubs and factories around the North East - much larger criminal operations are funded by this kind of crime."