Millennium Global Challenges No. 12. How can transnational organized crime networks be stopped from becoming more powerful and sophisticated global enterprises?

Reference: The Millennium Project

Although the world is waking up to the enormity of the threat of transnational organized crime (TOC), it continues to grow, while a global strategy to address this global threat has not been adopted. The UN Office on Drugs and Crime (UNODC) has called on all states to develop national strategies to counter TOC as a whole in its report, The Globalization of Crime: A Transnational Organized Crime Threat Assessment. The transition of much of the world’s activities to the Internet and mobile phones has opened up a wealth of opportunities for TOC to profitably expand its activities from drugs and human trafficking to all aspects of personal and business life. The financial crisis and the bankruptcy of financial institutions have opened new infiltration routes for TOC crime, and the world recession has increased human trafficking and smuggling. UNODC also notes states are not seriously implementing the UN Convention against Transnational Organized Crime, which is the main international instrument to counter organized crime. INTERPOL has started construction of an international complex in Singapore that will open around 2013 with 300 staff, to serve as a center for policy, research, and worldwide operations. UNODC, with other agencies, has founded the International Anti-Corruption Academy, near Vienna, having as one of its goals tackling the connection of TOC and corruption. That combination, allowing government decisions to be bought and sold like heroin, makes democracy an illusion.

Havocscope.com estimates world illicit trade to be about $1.6 trillion per year (up $500 billion from last year), with counterfeiting and intellectual property piracy accounting for $300 billion to $1 trillion, the global drug trade at $404 billion, trade in environmental goods at $63 billion, human trafficking and prostitution at $220 billion, smuggling at $94 billion, and weapons trade at $12 billion. The International Carder’s Alliance is based mostly in Eastern Europe, the heart of cybercrime, which the FBI estimates costs U.S. businesses and consumers billions annually in lost revenue. These figures do not include extortion or organized crime’s part of the $1 trillion in bribes that the World Bank estimates are paid annually or its part of the estimated $1.5–$6.5 trillion in laundered money. Hence the total income could be $2–3 trillion—about twice as big as all the military budgets in the world. The UN Global Commission on Drug Policy concluded that the law enforcement of the “War on Drugs” has failed and cost the U.S. $2.5 trillion over 40 years. It recommends a “paradigm shift” to public health over criminalization. The Financial Action Task Force of the Organization for Economic Cooperation and Development [the intergovernmental organization of industrialized nations] has made 40 recommendations to counter money laundering.

There are more slaves today than at the peak of the African slave trade. Estimates range from 12 million to 27 million people are being held in slavery today (the vast majority in Asia). UNICEF estimates that 1.2 million children are trafficked every year. The online market in illegally obtained data and tools for committing data theft and other cybercrimes continues to grow, and criminal organizations are offering online hosting of illegal applications. International financial transfers via computers of $2 trillion per day make tempting targets for international cyber criminals.

It is time for an international campaign by all sectors of society to develop a global consensus for action against TOC. Two conventions help bring some coherence to addressing TOC: the UN Convention against Transnational Organized Crime, which came into force in 2003, and the Council of Europe’s Convention on Laundering, which came into force in May 2008. Possibly an addition to one of these conventions or the International Criminal Court could establish a financial prosecution system as a new body to complement the related organizations addressing various parts of TOC. In cooperation with these organizations, the new system would identify and establish priorities on top criminals (defined by the amount of money laundered) to be prosecuted one at a time. It would prepare legal cases, identify suspects’ assets that can be frozen, establish the current location of the suspect, assess the local authorities’ ability to make an arrest, and send the case to one of a number of preselected courts. Such courts, like UN peacekeeping forces, could be identified before being called into action and trained, and then be ready for instant duty. When all these conditions are met, then all the orders would be executed at the same time to apprehend the criminal, freeze access to the assets, open the court case, and then proceed to the next TOC leader on the priority list. Prosecution would be outside the accused’s country. Although extradition is accepted by the UN Convention against Transnational Organized Crime, a new protocol would be necessary for courts to be deputized like military forces for UN peacekeeping, via a lottery system among volunteer countries. After initial government funding, the system would receive its financial support from frozen assets of convicted criminals rather than depending on government contributions.

Challenge 12 will be seriously addressed when money laundering and crime income sources drop by 75% from their peak.

Regional Considerations

Africa: The West Africa Coast Initiative is a partnership among UNODC, UN Peacekeeping, the Economic Community of West African States (ECOWAS), INTERPOL, and others to address the problems that have allowed traffickers to operate in a climate of impunity. The drug traffic from Latin America through the West African coast to Africa and Europe has been declining. Piracy, centering on Somalia and now invading the Indian Ocean, has become a major crisis, with 286 piracy incidents worldwide in 2010 and 67 hijacked ships and over 1,130 seafarers affected. Yemen’s unsettled future could leave the oil shipping lanes of the Arabian Sea bordered by two failed states. A multinational naval force is combating the problem, which is complicated by the lack of clear international legal structures for prosecution and punishment; Kenya has withdrawn its support in this area, but Somaliland and Puntland are helping. Some 930,000 sailors have signed a petition to the International Maritime Organization to stop piracy. Smoking of “whoonga” has become a serious problem in South Africa, with robberies committed to support £90 per day habits. The 15 million AIDS orphans in sub-Saharan Africa, with few legal means to make a living, constitute a gigantic pool of new talent for the future of organized crime. Corruption remains a serious impediment to economic development in many African countries.

Asia and Oceania: The International Conference on Asian Organized Crime and Terrorism held its eighth meeting to share intelligence. Disease cut Afghan opium production by almost half, but the acreage stayed the same; four more provinces became almost drug-free, but domestic addiction is spreading. China is the main source for counterfeit goods sent to the EU. India is a major producer of counterfeit medicines. North Korea is perceived as an organized crime state backed up by nuclear weapons involved in illegal trade in weapons, counterfeit currency, sex slavery, drugs, and a range of counterfeit items. Myanmar is accused of deporting migrants to Thailand and Malaysia, where they are exploited, and has reportedly become a center for the ivory trade and elephant smuggling. Myanmar and China remain the primary sources of amphetamine-type stimulants in Asia; Myanmar rebels are exporting hundreds of millions of tablets to Thailand to raise money. A report says Australia has a multi-billion-dollar drug enterprise, and Australians are among the world’s highest per capita consumers of illicit stimulants.

Europe: Europol published a 2011 TOC Threat Assessment at www.europol.europa.eu, indicating greater TOC mobility, operational diversity, and internal collaboration. The EU has strengthened controls on money transfers across its borders to address trafficking and money laundering, especially in Eastern Europe. Russian officials have declared the drug situation in that country “apocalyptic.” An estimated €30 million in EU carbon emission allowances were stolen in January. The Italian Guardia di Finanza arrested 24 people from a €2.7 billion Chinese counterfeit fashion operation, and Milan police arrested 300 members of ‘Ndrangheta, considered to be the most powerful crime syndicate in Italy. London police smashed a £100 million drug and money laundering gang.

Latin America: About 35,000 people have died in the Mexican drug war over the last four years, of which 15,000 died in 2010. Mexico’s cartels receive more money (an estimated $25–40 billion) from smuggling drugs to the U.S. than Mexico earns from oil exports. About $1 billion worth of oil was stolen from pipelines (396 taps) and smuggled into the U.S. over a two-year period. Mexican drug cartels are rapidly moving south, into Central America, and are branching out, with La Familia exporting $42 million worth of stolen iron ore from Michoacán in a year. UNODC says crime is the single largest issue impeding Central American stability. Cocaine production in Colombia has dropped by twothirds and is now done by small gangs, using farms hidden in the jungles. The drug gangs have largely replaced the paramilitaries. Ecuador has become an important center of operation for TOC gangs (3,000 people have reportedly moved in from Colombia). Police seized a drug smuggling submarine in Colombia. Drug cartels exist in Latin America because of illegal drug consumption in the U.S.

North America: The International Organized Crime Intelligence and Operations Center integrates U.S. efforts to combat international organized crime and coordinates investigations and prosecutions. The 22-month anti-cross-border-drug Project Deliverance ended successfully in June 2010 after the arrest of 2,200 individuals and the seizure of more than 69 tons of marijuana, 2.5 tons of cocaine, 1,410 pounds of heroin, and $154 million in currency. Only about 53 miles of operational “virtual fence” were put in place in Arizona, at a cost of about $15 million a mile; the project has been dropped. Drug criminal gangs have swelled in the U.S. to an estimated 1 million members, responsible for up to 80% of crimes in communities across the nation. Organized crime and its relationship to terrorism should be treated as a national security threat. Canada continues as a major producer and shipper of methamphetamines and ecstasy.

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