DEPUTY ASSISTANT SECRETARY DARBY TESTIFIES ON WILDLIFE TRAFFICKING CRISIS

FROM:  U.S. STATE DEPARTMENT

The Escalating International Wildlife Trafficking Crisis: Ecological, Economic, and National Security Issues

Testimony

M. Brooke Darby

Deputy Assistant Secretary, Bureau of International Narcotics and Law Enforcement Affairs

Statement Before the Senate Foreign Relations Subcommittees on African Affairs and East Asian and Pacific Affairs

Washington, DC

May 21, 2014

---

Chairmen Coons and Cardin, Ranking Members Flake and Rubio, and distinguished Members of the Subcommittees on African Affairs and East Asian and Pacific Affairs, thank you for inviting me here today to discuss the threat posed from wildlife trafficking and the efforts of the Department of State’s Bureau of International Narcotics and Law Enforcement Affairs (INL) to address it.

I testify before you today alongside committed champions and long-time supporters of enhancing conservation efforts, improving land management, protecting endangered species, and strengthening law enforcement capacities that safeguard natural resources and prevent and prosecute environmental and wildlife trafficking crimes. And while this may be an area that INL is somewhat new to, you can rest assured that we are now much more actively engaged, taking to heart the call-to-action by both the President and Secretary of State, to leverage all instruments at our disposal to strengthen our partners’ law enforcement and criminal justice capacities to combat wildlife trafficking.

Let me provide some insights into the breadth and scale of the challenge posed by the global illicit trade in wildlife. Increasing demand for illegally traded wildlife products in the last several years has fueled a massive uptick in poaching, particularly in Africa, and growing engagement by sophisticated transnational organized criminal networks, drawn to profits that can rival or in some cases even exceed those derived from drug trafficking. Conservative estimates of $8-10 billion in illicit revenues per year place wildlife trafficking among the top five most lucrative forms of transnational organized crime. In addition to searching out opportunities for high rewards, criminals also exploit environments with low risks of detection and meaningful punishment – and they find that in the illicit wildlife trade where they are able to exploit porous borders, corrupt officials, insufficient enforcement and investigative capacities and penalties, weak legal regimes, and lax financial system oversight.

All of us need to be concerned about the wide-ranging impact of the illegal wildlife trade, and organized criminal organizations’ involvement in it. I’d like to talk about the serious impact this crime has on humans and our security from INL’s perspective:

• The high tech weaponry and violent, aggressive tactics now employed by poachers threaten the safety and security of civilian populations, particularly in supply (also known as “range”) states. Park rangers are at special risk and many have been killed trying to protect wildlife.
• The corruption that both fuels, and is fueled by, the illegal wildlife trade undermines good governance and the rule of law, and erodes citizens’ confidence in their government institutions.
• Wildlife trafficking crimes create and exacerbate border insecurity, creating new vulnerabilities that other criminals, terrorists, and militias can exploit.
• The depletion of natural resources, and related corruption, weakens financial stability and economic growth, particularly in countries for which tourism is a major revenue source. Furthermore, illicit trade in illegally harvested marine species threatens food security, potentially undermining political stability in many developing nations.
• Terrorists and militia groups may seize the opportunity to benefit from the wildlife trade. We have some evidence that the Lord’s Resistance Army and the Janjaweed have done so, for example, trading wildlife products for weapons or safe haven.

For these reasons, the President issued an Executive Order calling for a whole of government response to combat wildlife trafficking on July 1, 2013 and released the National Strategy for Combating Wildlife Trafficking on February, 11, 2014. The Strategy calls on agencies and departments to address wildlife trafficking by: (1) strengthening domestic and global enforcement; (2) reducing demand for illegal wildlife products; and (3) building international cooperation and public-private partnerships.

INL is primarily involved in implementing the enforcement and international cooperation goals of the strategy through programmatic and diplomatic initiatives. We are not complete newcomers to the game -- for over a decade, we have provided wildlife investigative training delivered by the U.S. Fish and Wildlife Service as part of our International Law Enforcement Academy (ILEA) program. But within the last year, with strong support from Congress, we have begun to greatly expand our programs, drawing on our experience in addressing other forms of transnational criminal activity. We have organized our work around four key areas.
First, we will work with interested partners to strengthen legislative frameworks to make wildlife trafficking a serious crime with strong penalties in order to provide investigators and prosecutors the legal tools they need to put the traffickers behind bars.

Second we will improve law enforcement and investigative capabilities – including intelligence, evidence collection and analysis, investigative skills and methods, and collaboration across agencies and governments – with our partner agencies to promote intelligence-led investigations and operations that strive not simply to pick up individual poachers but rather to better understand and begin to dismantle the organizations for which they work.
Third, we will work to build prosecutorial and judicial capacities with our partners. As we have learned, rangers and police will not continue to apprehend the bad guys if they believe prosecutors or judges will just let them go. So as we improve legislative frameworks and offer up new tools, we need to ensure prosecutors and judges know how to use those tools effectively and creatively.

And fourth, we will enhance cross-border law enforcement cooperation, particularly by working with the regional Wildlife Enforcement Networks (WENs) with other agencies. There is much that we need to learn about how wildlife trafficking organizations operate – but we do know that illegal wildlife products often make their way through multiple transit points as they move from supply states to demand markets. So we need to build alliances and processes across borders for sharing information and intelligence and collaborating on operations.
The National Strategy stresses the need to marshal and strategically apply federal resources through a coordinated approach. Our work in these areas will be done on a bilateral and regional basis looking at priority areas and landscapes for U.S. foreign assistance in Latin America, Africa, and Asia. When the President announced the Executive Order to Combat Wildlife Trafficking last July, he also announced that $10 million would support law enforcement efforts in Africa. Those funds, coupled with approximately $6 million in prior year funding, are supporting bilateral INL programming in Kenya and South Africa; regional capacity building efforts in Africa and East Asia and the Pacific, and global programs, including efforts through INTERPOL, the United Nations Office on Drugs and Crime (UNODC), and the World Customs Organizations, all of which are part of the International Consortium for Combating Wildlife Crime (ICCWC). The approximately $15 million recently directed in FY 2014 International Narcotics Control and Law Enforcement (INCLE) funds will enable us to expand efforts begun or piloted using prior year resources, such as training for customs officers at ports of entry, prosecutorial training, and joint capacity building-operational exercises across regions and continents.

INL’s engagement extends beyond assistance programming. We also are tapping into tools developed to address transnational organized crime, to tackle the specific challenge of wildlife trafficking, including the Transnational Organized Crime Rewards Program, which Congress authorized in 2013. In November 2013, Secretary Kerry announced the first reward offer under the program of up to $1 million for information leading to the dismantling of the Xaysavang Network. The Xaysavang Network, based in Laos and operating across Africa and Asia, facilitates the illegal trade of endangered elephants, rhinos, and other species.

Through diplomatic outreach and engagement, we are building international consensus around the importance of dismantling wildlife trafficking networks. For example, at the U.N. Crime Commission in April 2013, the United States introduced a successful joint resolution with Peru encouraging governments around the world to treat wildlife trafficking as a “serious crime” pursuant to the U.N. Convention against Transnational Organized Crime. Making it a serious crime unlocks new opportunities for international law enforcement cooperation provided under the Convention, including mutual legal assistance, asset seizure and forfeiture, extradition, and other tools to hold criminals accountable for wildlife crime. The U.N. Economic and Social Council adopted the resolution in July 2013, further elevating wildlife trafficking as a major concern for the United Nations. These measures provide the mandate that we need, as members of a larger body of concerned nations, to harness our collective capabilities to learn more about these trafficking networks, share information, and collaborate on plans and programs that will undermine them.

Another early success to which we can point is a recent month-long global law enforcement cooperative effort, known as “Cobra II,” that we helped to support. Participants from 28 countries, including representatives from the U.S. Fish and Wildlife Service with participation from USAID, executed this global operation in February 2014 to combat wildlife trafficking and poaching which resulted in more than 400 arrests and 350 major seizures of wildlife and wildlife products across Africa, Asia, and the United States. The operation demonstrated to participants the benefits and results that can be achieved by working together and we will seek to build on the positive momentum it generated.

Although we have more to learn about the links that exist between wildlife trafficking organizations and other transnational criminal groups, we do know that wildlife traffickers do not operate in a vacuum. Criminal organizations tend to use the same routes and shipping methods as smugglers of weapons, drugs, and counterfeits. They bribe the same customs officials. They deploy poachers in the same restive regions where terrorists and other criminals may sow instability and conflict and exploit weak institutions and porous borders. Money and corruption are common denominators of all forms of transnational organized crime, and wildlife trafficking is no exception.

INL is looking at ways to connect our anti-corruption and unit vetting programs used effectively in narcotics-producing regions, to support willing governments afflicted by wildlife trafficking. We are also examining the broader use of Presidential Proclamation (PP) 7750, which is used to bar entry into the United States of high-level corrupt officials and their family members, against wildlife traffickers and their enablers.

Following the money is equally important. All illicit criminal networks need money to finance their activities and as illicit funds move through the international financial system, they can be detected and monitored. In addition to exercising leadership within the Financial Action Task Force (FATF), we are promoting and applying tools like asset recovery and forfeiture to combat transnational organized crime and money laundering. Through the FATF style regional body for Eastern and Southern Africa, we are working with international partners to uncover and counter money laundering and other illicit financial flows related to wildlife trafficking. We then will develop capacity building projects to address gaps this study identifies.

Illicit networks undercut the ability of law enforcement to protect citizens, deprive the states of vital revenues, promote corruption, and contribute to bad governance. But as organized crime has evolved and diversified, so has INL. Our programs are tailored to specific and cross cutting threats, including wildlife trafficking, to target the common facilitators of all types of crime.
Thank you, Chairman Coons, Chairman Cardin, and Distinguished Members of the Subcommittees for your attention to and support of our collective efforts to combat wildlife trafficking. I welcome your questions.

SECRETARY OF STATE KERRY'S STATEMENT ON REWARD OFFER FOR TRANSNATIONAL ORGANIZED CRIME INFORMATION

FROM:  U.S STATE DEPARTMENT 
First Reward Offer for Transnational Organized Crime Information
Press Statement
John Kerry
Secretary of State
Washington, DC
November 13, 2013

I am proud to announce the State Department’s first-ever reward for information leading to the dismantling of a transnational criminal organization, as part of our new Transnational Organized Crime Rewards Program.

The involvement of sophisticated transnational criminal organizations in wildlife trafficking perpetuates corruption, threatens the rule of law and border security in fragile regions, and destabilizes communities that depend on wildlife for biodiversity and eco-tourism. Profits from wildlife trafficking, estimated at $8–10 billion per year, fund other illicit activities such as narcotics, arms, and human trafficking.

That is why the Department of State is offering a reward of up to $1 million for information leading to the dismantling of the Xaysavang Network.

Based in Laos—with affiliates in South Africa, Mozambique, Thailand, Malaysia, Vietnam, and China—the Xaysavang Network facilitates the killing of endangered elephants, rhinos, and other species for products such as ivory.

Several major seizures of illegal wildlife products have been linked to the Xaysavang Network.

U.S. TARGETS TRANSNATIONAL ORGANIZED CRIME WITH REWARDS PROGRAM

FROM:  U.S. STATE DEPARTMENT 
Transnational Organized Crime Rewards Program: Targeting Global Criminal Networks
Fact Sheet
Bureau of Public Affairs
November 12, 2013

This rewards program “will promote the leads and tips needed to hobble transnational organized crime, the movement of international criminals . . . and transnational criminal organizations that pose threats not only abroad, but right in our own back yard.”   - Secretary of State John Kerry

The United States established the Transnational Organized Crime Rewards Program in order to assist efforts to dismantle transnational criminal organizations and bring their leaders and members to justice.

The program gives the Secretary of State statutory authority to offer rewards for information that helps:

Dismantle transnational criminal organizations
Identify or locate key leaders
Disrupt financial mechanisms
Lead to the arrest or conviction of members and leaders
The program complements the Narcotics Rewards Program by offering rewards up to $5 million for information on significant transnational criminal organizations involved in activities beyond drug trafficking, such as human trafficking, money laundering, maritime piracy, and trafficking in arms, counterfeits, and other illicit goods.

Combating Transnational Crime

The U.S. Department of State’s Bureau of International Narcotics and Law Enforcement Affairs (INL) manages the program with U.S. federal law enforcement agencies. It is a key element of the White House Strategy to Combat Transnational Organized Crime, which recognizes that transnational criminal networks are expanding in size and scope, and diversifying their illicit activities.

How the Rewards Work

Proposals to pay rewards are submitted to the Department of State by U.S. agencies or U.S. Embassies overseas. Reward proposals are carefully reviewed by an interagency committee, which makes a recommendation for a reward payment to the Secretary of State. Only the Secretary of State has the authority to determine if a reward should be paid. In cases where there is U.S. federal criminal jurisdiction, the Secretary must obtain the concurrence of the Attorney General.

Contact Information

Overseas, individuals wishing to provide information on major transnational criminal organizations may contact the nearest U.S. Embassy or Consulate. In the United States, individuals should contact the Federal Bureau of Investigation (FBI), the Drug Enforcement Administration (DEA), or the Department of Homeland Security, Immigration and Customs Enforcement (ICE). Government officials and employees are not eligible for rewards.

All communications regarding information provided will be held in the strictest confidence.
For more information about the Transnational Organized Crime Rewards Program and current reward offers, please visit: www.state.gov/TOCrewards

RECENT U.S. NAVY PHOTOS

FROM: U.S. NAVY
130402-N-XQ474-080 NORTH ARABIAN SEA (April 2, 2013) Sailors use an aircraft elevator to transport mail from the flight deck to the hangar bay aboard the aircraft carrier USS Dwight D. Eisenhower (CVN 69). Dwight D. Eisenhower is deployed to the U.S. 5th Fleet area of responsibility promoting maritime security operations, theater security cooperation efforts and support missions as part of Operation Enduring Freedom. (U.S. Navy photo by Mass Communication Specialist Seaman Andrew Schneider/Released)

130403-N-IC228-012 FERNANDINA BEACH, Fla. (April 3, 2013) The Navy's only MZ-3A manned airship launches from the Fernandina Beach Municipal Airport for a flight demonstration for U.S. Sen. Bill Nelson, from Florida. The airship is visiting U.S. 4th Fleet headquarters for a capabilities demonstration as a potential search and detect platform for counter transnational organized crime operations in South and Central America and the Caribbean Sea. (U.S. Navy photo by Lt Cmdr. Corey Barker/Released)

 

INCAE AND WOODROW WILSON PRIVATE SECTOR INITIATIVE

FROM:  U.S. STATE DEPARTMENT
INCAE and Woodrow Wilson Private Sector Initiative to Address Crime and Insecurity in Central America
Remarks Maria Otero
Under Secretary for Civilian Security, Democracy, and Human Rights World Bank
Washington, DC
April 19, 2012
(As Delivered)
Thank you, Cynthia. It is an honor to attend the third meeting of the INCAE and Woodrow Wilson Center project here in Washington, DC. I also want to thank the World Bank and the Central American Private Sector Initiative for co-hosting today’s event. I especially want to thank INCAE and the Woodrow Wilson Center for bringing together the private sector to help create practical solutions to the security challenges in Central America – because we know that governments cannot do this work alone. Your contribution is critical to help build safe, prosperous, and democratic societies in Central America.

Today, I want to talk about three key areas of the U.S. strategy to combat crime and insecurity in Central America: First, what the U.S. is doing to reduce the demand for illicit drugs in our own country, which we know is a major factor in this transnational issue. Second, how the U.S. is utilizing new international partnerships to address transnational organized crime and citizen security. And lastly, the need for a comprehensive, community-based approach to address citizen security in each country in Central America.
At the Summit of the Americas, President Obama and Secretary Clinton engaged with the leaders of the region in a robust and healthy dialogue on a range of issues, including the U.S. strategy on drugs. The U.S. has acknowledged that the high demand for drugs in our own country is a major contributing factor to drug trafficking and its effects in the region. In response to this concern, President Obama charted a new direction for our efforts to reduce illicit drug use and its consequences by launching a National Drug Control Strategy in 2010. This week, he announced a revised strategy that provides a review of our progress, and looks ahead to continued reform.

This new strategy rejects the false choice between an enforcement-centric “war on drugs” on the one hand and the notion of drug legalization on the other, an issue that was also addressed in Cartagena.

While the United States remains open to engaging in discussion on this issue, we do not believe that legalization is the path towards a holistic solution to combat drug trafficking and organized crime and improve citizen security across the region.

The United States believes there must be a balanced approach to reducing illicit drug use, and our efforts are yielding results. The rate of overall drug use in America has dropped by roughly one-third over the past three decades. Since 2006, meth use in America has been cut by half and cocaine use has dropped by nearly 40 percent. In 2011, the United States spent over 10 billion dollars on drug prevention and treatment; 9.4 billion dollars on domestic law enforcement; 3.6 billion on interdiction, and 2.1 billion on international drug control programs. The President’s revised National Drug Control Strategy seeks to redouble our efforts, and employs a balance of evidenced-based public health and safety reforms.
Another pillar of this strategy is strengthening international partnerships – and at the leadership of Secretary Clinton, we have created new partnerships to address the security challenges in Central America.

The United States has developed new modes of cooperation starting by addressing security issues that are identified by Central Americans themselves. Secretary Clinton firmly believes that the solutions to the problems in Central America must come from Central Americans – that is why the U.S. supports the Central American Integration System, commonly known as SICA. I cannot stress the importance – however difficult and slow it may be – to have the government leaders of Central America agree upon the primary security challenges and then identify as a group the specific areas of cooperation needed to create the solution. Today’s event further contributes to the Central American-led effort to identify practical solutions to the security challenges facing the region.

The U.S. programmatic efforts are funneled through our Central America Regional Security Initiative – known as CARSI – which is an integrated, collaborative program designed to disrupt and dismantle the gangs and transnational criminal organizations. From 2008 to 2011, the United States has allocated over 361 million dollars to CARSI efforts.

At the Summit of the Americas, President Obama announced that the U.S. will allocate 130 million dollars for CARSI in fiscal year 2012.

Our support is focused not just on helping security forces track down criminals. We are working to address the root causes of violence, from impunity to lack of opportunity. We are working to build accountable institutions free from corruption that respect human rights and enhance the rule of law. We are building partnerships to improve courts and prisons, train police and prosecutors, and enhance education systems and job-training centers. We are working towards building partnerships with political leaders, but also with civil society, businesses and with the elite, who have a special obligation to help confront these challenges.

The U.S. welcomes the progress on tax reform in some countries, such as President Perez Molina’s tax reform in Guatemala and the recently passed security taxes in Costa Rica and Honduras. The fact that so many of the wealthy in Latin America have not paid their fair share of taxes is one of the many reasons why the services that are necessary to protect citizen security and enhance educational opportunities have not been available. Fora such as the one today are critical to ensure the voices of the private sector are part of the solution.

In addition to new partnerships with Central Americans, we are building partnerships across the Americas. One example is our cooperation with Colombia in Central America. Presidents Obama and Santos announced a new Action Plan on Regional Security Cooperation earlier this week in Cartagena. These coordination efforts will initially focus on Guatemala, Honduras, El Salvador, and Panama with the goal of expanding to the rest of the Americas and West Africa. Both countries will develop complementary security assistance programs and operational efforts to support partner nations afflicted by effects of transnational organized crime.

Lastly, I want to talk about the progress we are seeing on the ground. I have seen the most progress during my visits to Central American countries when there is a multi-faceted, community-based approach that empowers all actors in society – including municipal and state government officials, members of the private sector and civil society, and individual citizens, with a focus on young people who are not only the most at-risk, but who have the most potential to change their communities for the better.

We are seeing progress clearly demonstrated in the Model Precinct Program which has significantly aided in reducing homicides, robberies, and burglaries throughout the region. The program uses community-based policing techniques and youth drug prevention programs like the Gang Resistance Education and Training – or GREAT - and the Police Athletic League to build local support. Police officers assigned to the unit receive several years of classroom and on-the-job training, greatly increasing their investigative and patrolling capabilities.

I recently visited the Model Precinct in Lourdes, El Salvador, where new police leadership was installed in the spring of 2010. The new commander of the Lourdes precinct fully embraced and implemented best practices for policing. By adopting an intelligence-led policing philosophy for crime prevention and targeted enforcement, the Lourdes precinct reduced the number of homicides from 287 in 2010 to 170 in 2011 -- a 40 percent reduction. All other major crimes were also reduced by more than 40 percent. By comparison, the national homicide rate in El Salvador rose by 9 percent in 2011.

Now these programs occur on a municipal-level; the challenge is how to scale up these efforts and replicate them across each nation and the region. In Guatemala, the new tax reform funds will go to support community-based policing programs building upon the Model Precinct in other parts of the country. For example, I visited the Mixco Model Precinct earlier this year. The local mayor, police chief, priest and community leaders worked together to create a new level of trust and collaboration that resulted in a significant decrease in the levels of crime and violence.

And it was clear that these efforts were not only difficult, but dangerous. In this particular case, the police chief had to release a high percentage of the police force due to corruption and train an entire new cadre of young police officers. So we see that even these models are not simple, and take a great deal of time, effort and personal investment by many actors. I am pleased that we will now expand this program in Honduras, which has launched the first Model Precinct Program. President Lobo has indicated that funds from the new security tax will go towards the expansion of these efforts.

Solving the crime and insecurity that plagues Central America requires a set of multi-faceted responses that include involvement by every sector of society. My message to those of you here today is that your governments need you – they need your investment in the country. And more importantly, they need your support to help increase the political will needed to face these tough issues head-on. They need your help to rebuild weak institutions, to strengthen the judicial system, to build capacity through the government, all essential for a meaningful and long lasting response.

U.S. TOP BRASS SPEAKS ON TRANSNATIONAL ORGANIZED CRIME

The following excerpt is from a U.S. Department of Defense American Forces Press Service e-mail:

Dempsey Discusses Combatting Transnational Organized Crime

By Jim Garamone
American Forces Press Service

MIAMI, March 26, 2012 - Transnational organized crime is not specifically mentioned in the new defense strategy, but leaders understand the threat, the chairman of the Joint Chiefs of Staff said at U.S. Southern Command today.

One of the main missions of the command is to deal with the threat posed by drug cartels, human traffickers and gunrunners -- what the command calls transnational organized crime. The command works with regional allies and with U.S. interagency partners to combat this transnational threat.

Army Gen. Martin E. Dempsey spoke during a Southcom town hall meeting before leaving for a visit to regional allies. Before the town hall, he met with Air Force Gen. Douglas Fraser, Southcom's commander, and received briefings on the range and breadth of threats and opportunities in the region.

"I want to assure you that we recognize the threat that transnational organized crime presents, not just because of what they transport to our shores, but what they could also transport -- terrorists and weapons and weapons of mass destruction," the general said.

These crime organizations present many of the same problems that other threats in the world pose the United States. "They are networked, they are decentralized and they are syndicated," he said.

Crime organizations are using 21st century technologies to commit their crimes. They are able to exercise command and control over a wide area and adapt quickly. Dempsey noted that the semi-submersible drug-running craft that is used as a display at Southcom headquarters is just a thing of the past to cocaine traffickers. They now use true submarines that carry a small crew, and a large cargo of cocaine.

The crime networks are decentralized, the chairman said, and will not mass against the United States because they will lose. Rather than challenge the American military directly, they'll work in an asymmetric manner.

Finally, they are syndicated. This means they will ally themselves with other organized crime gangs, weak governments, rebel groups, or whoever suits their needs at the time.

To defeat them, the United States has to be quicker than they are, Dempsey noted. The United States must be a partner in a regional network, and the Defense Department must be a part of a network that includes all aspects of government. The military can clear an area, but if the government cannot hold it -- and bring jobs, education and health care benefits -- it will lose that area.

U.S. SOUTHERN COMMAND FOCUSES ON TRANSNATIONAL ORGANIZED CRIME

The following excerpt is from the Department of Defense American Forces Press Service:

Southern Command Targets Transnational Organized Crime

By Jim Garamone
American Forces Press Service

WASHINGTON, March 13, 2012 - U.S. Southern Command is focused on stopping transnational organized crime and building partners' capabilities, Air Force Gen. Douglas Fraser said here today.

Speaking before the Senate Armed Services Committee, the Southern Command commander detailed the challenges facing Southcom, which has responsibility for U.S. military relationships in Central and South America and the Caribbean.

Working with other U.S. federal agencies, the command has focused on a concern that permeates the region: transnational organized crime, which the general said "is seriously impacting citizen safety in Central America, especially Guatemala, El Salvador and Honduras."

Transnational crime rings "threaten to overwhelm law enforcement capacities, and in an effort to reduce violence and halt the spread of these criminal groups, these countries have deployed their militaries in support of law enforcement organizations," he said.

Disrupting these narcosyndicates is part of the overall strategy in the region, Fraser said. In the past year, the command developed and implemented Operation Martillo, a plan to disrupt illicit maritime traffic in the departure zones of South America and the arrival zones in Central America, the general said.

Southern Command personnel have helped train partner nations' military members to support local police, and provides "network analysis of transnational criminal organizations and their operations," Fraser said.

The command works in the Caribbean under the Caribbean Basin Security Initiative, which is developing the regional maritime interdiction plan to enhance the capabilities of Caribbean partners, Fraser said.

"In South America, we will sustain our support to Colombia and to Peru as they fight narcoterrorist groups in these countries," he said.

The command is working to build enduring international and interagency partnerships by promoting cooperation and information-sharing, Fraser said.

Personnel also are working through traditional military channels to strengthen disaster relief capabilities," he said. "We remain ready to respond should our assistance be requested," he said.

The command has been busy. In 2011, it conducted hundreds of training and educational events, 12 major multinational exercises with partner nations in the hemisphere and 56 medical readiness training exercises in 13 countries.

"This sustained engagement is yielding important benefits," Fraser said. "Last year, for the first time, Colombia assumed the land component commander role during Panamax, our annual multinational exercise focused on supporting the defense of the Panama Canal."

This year, Brazil will command the maritime component of the exercise, he said.

Threats are not limited to the homegrown varieties. Iran is very engaged in Latin America, the general said. "They have doubled their number of embassies in the last seven years," he said. "They now have 11 embassies. They have 40 cultural centers in 17 different countries throughout the region."

Southern Command officials see the Iranian activity as trying to build cultural awareness and awareness for Iran to circumvent international sanctions against Iran. "They are seeing an opportunity with some of the anti-U.S.-focused countries within the region as a method on being able to do that," he said.

The concern lies with Iran's connections with Hezbollah and Hamas terrorist groups, both of which have organizations in Latin America, Fraser said. "Those organizations are primarily focused on financial support to organizations back in the Middle East, but they are involved in illicit activity," he said.

DEPUTY AG SPEAKS ON TRANSNATIONAL ORGANIZED CRIME WHILE IN MEXICO CITY

The following excerpt is from the Department of Justice website:

“Deputy Attorney General James Cole Speaks at High Level Hemispheric Meeting Against Transnational Organized Crime Mexico City ~ Thursday, March 1, 2012
Mr. President, Madame Attorney General, Madame Minister, Mr. Secretary General, distinguished attorneys general and guests.

It is a distinct pleasure to be in Mexico City at today’s Hemispheric Meeting and to have the unique opportunity to speak with you – our shared partners in the Americas and Spain – about transnational organized crime, undoubtedly a global menace that we must work together to defeat.   Organized criminals have adapted rapidly to the new, globalized world.   They are, in fact, helping to shape that world, and not in a good direction.   Our peoples, our governments, must prove equally adaptable if we are to prevail.   The steps that the U.S. Department of Justice, the U.S. government as a whole, and our partners around the world are taking to address the threat cannot be overstated.

For many decades the fight against organized crime has been one of the highest enforcement priorities of the Department of Justice.   Many dedicated agents and prosecutors over the past 80 years have devoted their careers to the battle against the families of La Cosa Nostra, Italian-American crime groups that at one time existed in most major cities in the United States.   More recently, agents and prosecutors have brought an equal level of dedication to the fight against the narco-trafficking cartels, who have been and remain some of the most sophisticated and dangerous transnational organized crime groups in the world.

But even as we continue to vigorously investigate and prosecute these criminal groups, we are aware that the landscape of organized crime has been shifting.   The advance of globalization and the internet, while hugely beneficial to people everywhere, has also created unparalleled opportunities for criminals to expand their operations and use the facilities of global communication and commerce to carry out their criminal activities across national borders.

In December 2010 the United States government completed a comprehensive review of international crime.    That review concluded that in the previous 15 years transnational criminal networks have forged new and powerful alliances among themselves and with powerful figures in business and government, and that they are engaged in an unprecedented range of illicit activities that are destabilizing to nations and populations around the globe.

Our review noted that the new transnational organized crime groups pose special challenges to law enforcement.   For example, some countries undergoing the transition from authoritarian rule often serve as fertile breeding grounds for organized crime.   These countries face serious organized crime challenges that will stifle not only their own economic development, but will also have global implications in our increasingly interconnected world.

Organized crime groups in the past often featured rigid lines of authority and closed
memberships.   This not only imposed a level of discipline, but it also made them easier to define and combat.   The newer organizations often consist of loose networks of individuals or groups that may cooperate on an ad hoc basis to share expertise, skills and resources, while still operating independently and transcending national boundaries.   This allows criminals to more easily evade law enforcement and to adapt quickly to changing market conditions.   The decentralized nature of their operations also means that law enforcement can no longer cripple the network by arresting a few key leaders.

Because of the sophistication of the world economy, organized crime groups have developed an ability to exploit legitimate actors and their skills in order to further the criminal enterprises.  For example, transnational organized criminal groups often rely on lawyers to facilitate illicit transactions.    These lawyers create shell companies, open offshore bank accounts in the names of those shell companies, and launder criminal proceeds through trust accounts.   Other lawyers working for organized crime figures bring frivolous libel cases against individuals who expose their criminal activities.   Business owners and bankers are enlisted to launder money, and employees of legitimate companies are used to conceal smuggling operations.   The range of illicit-to-licit relationships is broad.   At one end, criminals draw on the public reputations of legitimate actors to maintain a facade of legality for their operations.   At the other end are specialists with skills or resources who have been completely subsumed into the criminal networks.

The range of criminal activities that these transnational organized crime groups engage in is extremely broad.   While our review concentrated on the crimes these groups were committing in the United States, we see evidence that these groups are committing the same crimes from locations in many other countries as well.   I’d like to offer a few examples.

Transnational organized criminals are penetrating key strategic markets.   Our review found that alliances between organized criminals and oligarchs from the former Soviet Union threaten U.S. businesses and domestic markets.   Industry officials in certain sectors like commodities fear that quasi-licit firms and individuals with major organized crime ties are gaining market share.  With their international business connections, large sums of money and political ties, some Eurasian oligarchs operate as quasi-legitimate business figures to open the doors of U.S. companies and markets to organized crime influence.

We also found that transnational organized crime groups increasingly use cyberspace to target U.S. consumers and businesses, using a variety of techniques to drain their bank accounts and steal their identities.   In addition to “phishing”, advanced fee fraud schemes and Internet auction fraud, criminals use more sophisticated techniques such as the remote targeting of point-of-sale machines.   The U.S. Secret Service estimates that criminals using anonymous web sites to buy and sell stolen identities have caused billions of dollars in losses to the United States’ financial infrastructure.   Some estimates indicate that online frauds perpetrated by Central European cybercrime networks alone have defrauded U.S. citizens or entities of approximately $1 billion in a single year.

Transnational organized crime groups are increasingly engaging in a variety of public sector fraud, including frauds against the U.S. Government.   Such crimes include food stamp and welfare fraud, Medicare and Medicaid fraud, and government grant and loan program fraud.  For example, in October 2010 seventy-three defendants, including a number of alleged members and associates of an Armenian-American organized crime enterprise, were charged with various health care fraud-related crimes involving more than $163 million in fraudulent billing to Medicare and insurance companies.

We also found that transnational organized criminal networks are increasingly active in stealing critical U.S. intellectual property, including through intrusions into corporate and proprietary computer networks.   Theft of this kind of property, ranging from movies to proprietary designs of high-tech devices and manufacturing processes, causes significant business losses and erodes our competitiveness in the global marketplace.   From 2005 to 2010 the yearly value of seizures in the United States of illegal products that violated intellectual property laws jumped from $93 million to $188 million.   Products originating in China accounted for 66 per cent of these seizures in 2010.

Finally, transnational criminals prey upon weaknesses and differences in international transportation and customs security regimes.   Specialized criminal networks feature prominently in the trafficking of narcotics, the movement of contraband items, the counterfeiting of goods and the smuggling and trafficking of humans into the United States.   For example, between 2005 and 2007, we identified several Uzbek criminal networks engaged in human trafficking.   They operated cleaning companies that exploited guest workers to service national hotel and retail chains, and they moved operations regularly to avoid detection.  Similarly, drug cartels’ control of smuggling routes along the 2,000 mile border with the United States is a key to their ability to make money.   Human traffickers have also exploited those same smuggling routes across the U.S.-Mexico border to target undocumented migrants for labor or sex trafficking.

What are the results of these disturbing trends and new patterns of crime?   In short, our review concluded that transnational organized crime has risen to the level of a national security threat.  Countries in key regions around the world are finding their governments penetrated, weakened and even taken over by organized crime, undermining their democratic institutions and prospects for economic growth.   Economies, including critical markets and the world financial system are being subverted, exploited and distorted by organized criminals through corruption and violence, making it harder for legitimate businesses to compete in those markets and harder for those economies to develop and provide jobs for the law abiding citizens. Terrorists and insurgents are increasingly turning to organized crime to generate funding and acquire logistical support to carry out their violent acts.   Cybercrime threatens sensitive government and corporate computer networks, undermines confidence in the international financial system, and costs consumers billions of dollars annually.   And despite our many successes, illicit drugs remain a serious threat to the health, safety, security and financial well-being of our citizens.

These are sobering findings, made even more so by the fact that we recognize that our domestic law enforcement, working alone, cannot defeat these threats.   Organized crime cases, involving informants, undercover agents, wiretaps, cooperating witnesses and sophisticated legal tools, are already among the most complex and challenging investigations undertaken by the Justice Department.   Transposed to an international setting, where much of our evidence and many of our witnesses and defendants reside in other countries, and where the rules governing investigations that cross numerous borders are quite complex and at times inadequate, the demands of an organized crime investigation can quickly outstrip any level of resources that we are able to devote to it.   The result in too many cases will inevitably be that the most culpable individuals are not brought to justice.

But, far from despairing, we believe that recognizing the scale of the challenges facing us is the first step to overcoming them.   Under the leadership of the White House, the Department of Justice and other parts of the U.S. government came together and developed the Strategy to Combat Transnational Organized Crime, which was released in July of last year.   The Strategy set out several overarching goals to be achieved by our government to meet the threat of transnational organized crime.

First, we must protect our citizens and the citizens and nationals of our partner nations from the harm, violence and exploitation of transnational criminal networks.   Under the Strategy, we are targeting the networks that pose the gravest threat to safety and security, including those that traffic illicit drugs, arms and people, sell substandard, tainted and counterfeit goods, commit robberies, extortions and kidnappings, and seek to terrorize and intimidate through acts of torture and murder.

Second, we must help partner countries strengthen governance and transparency, break the ability of transnational criminal networks to corrupt public officials, and sever alliances between criminals and governments.   We recognize that we need willing, reliable and capable partners to combat the corruption and instability generated by transnational organized crime.  We are actively working with our international partners to develop capabilities to strengthen public safety, security and justice institutions to fight these threats.

Third, we must break the economic power of transnational criminal networks and protect our markets and financial systems from penetration by organized crime.   We have already begun a program of attacking the financial underpinnings of the top transnational criminals, stripping them of their illicit wealth, cutting off their access to the financial system, and exposing their criminal activities hidden behind legitimate fronts.

Finally, we must build international consensus, multilateral cooperation, and public-private partnerships to defeat transnational organized crime.   Stopping organized crime is not a task limited to one government, or even many governments.   We must build new partnerships, new networks, with industry, finance, academia, civil society and non-governmental organizations, to combat organized crime networks.   We must protect press freedoms so that the media and journalists can expose the harms inflicted by organized crime.   We are working to deepen our understanding, information sharing and cooperation with foreign partners and multilateral institutions, and through this we will further international norms against tolerating or sponsoring crime in all its forms, including cyberspace.

To achieve these goals, the Strategy set in motion actions across the U.S. government, starting new initiatives and enhancing existing ones, and bringing the different agencies together so that we could have the greatest impact on organized crime.

At the Justice Department, we had already begun to tackle transnational organized crime.   We recognized that part of the challenge posed by transnational organized crime lay in the fact that information concerning these groups was scattered across the federal law enforcement community.   We therefore began by bringing together the heads of nine federal law enforcement agencies, from the FBI, DEA and ICE to the Postal Inspectors and Department of Labor, to advise the Attorney General in an Organized Crime Council.   Their deliberations resulted in the creation of the International Organized Crime Intelligence and Operations Center in 2009.   This Center pools the resources of the nine agencies, plus federal prosecutors, in a setting where all of the agencies’ relevant information can be sifted to produce a complete picture of the workings of a criminal organization.   Furthermore, the Center produces this picture in a form that can immediately be put to use by agents investigating the organization.   We also created a top target list for organized crime groups common to all nine federal agencies.   At a minimal cost, these steps did much to unify the disparate efforts of many agencies and provide a single focus on the greatest perceived transnational organized crime threats.

As part of the Administration’s overall Strategy, the Justice Department also took a hard look at the legal tools that we are using to fight organized crime.   We found that many of our statutes had not kept up with developments in the criminal world.   Our money laundering statutes, groundbreaking when first enacted, had gaps when applied to illicit proceeds in the U.S. that were generated by criminal activity in other countries.   Our famous anti-racketeering statute, known as RICO, did not explicitly cover some of the crimes being committed by transnational organized crime groups – like foreign bribery or certain types of computer fraud – and recent court decisions made it unclear whether RICO could even be used to prosecute an organized crime group if most of their activities were transnational in nature.  To remedy these and other gaps the Department prepared a series of legislative proposals that were announced at the same time as the Strategy and that are now beginning to work their way through Congress.

The Strategy recognized that agencies outside the category of law enforcement had a critical role to play in the fight against transnational organized crime.   Most importantly, perhaps, the Strategy was accompanied by an Executive Order, signed by the President, which directed the Treasury Department to establish a sanctions program to block the property of and prohibit transactions with significant criminal networks that threaten national security, foreign policy, or economic interests.   This power had previously been restricted to terrorists and narcotics kingpins, but was now extended to other transnational organized crime groups.   By shutting designated individuals and their companies out of the U.S. financial system, these sanctions programs have the power to affect criminals operating around the world.   Just last week the Treasury Department announced the first individual sanctions under this order, naming seven members and associates of the Brothers’ Circle Eurasian organized crime group and two members of the Japanese Yakuza criminal organizations, and prohibiting U.S. individuals and companies from doing business with them.   The Justice Department and the Treasury Department are working closely with each other to further develop this program.

The Strategy also took direct aim at those criminals who try to portray themselves as legitimate businessmen and seek to gain respectability by traveling to and conducting business in the United States.   A Presidential Proclamation under the Immigration and Naturalization Act gave the State Department the power to deny U.S. entry to transnational criminal aliens and others who have been targeted for financial sanctions.   The State Department was also directed to establish a new rewards program, expanding upon the success of the narcotics rewards program, to obtain information that leads to the arrest and conviction of leaders of transnational criminal organizations that pose the greatest threats to national security.

To tie these efforts together, the Strategy also directed the establishment of an interagency working group to identify those transnational organized crime threats that present a sufficiently high national security risk and coordinate the work of the whole spectrum of U.S. agencies in acting against that threat.

Woven throughout the Strategy is the recognition that transnational organized crime is a threat to law abiding citizens of all nations, and that nations must work together if it is to be defeated.  We understand that nations are affected by transnational organized crime in different ways, and that different nations have different capabilities to fight these groups.   But we must come together and combine those capabilities if we hope to ultimately prevail against this growing menace.

We welcome today’s Hemispheric Meeting sponsored by our Mexican hosts and the OAS as a sign that our concerns are shared by our partners in the Americas.   Our work at this conference is critically important, for it is here over the next two days that we can reach a common understanding of the problem of transnational organized crime, and begin to craft a united response.   Looking out among you, I am confident that we will succeed.

Thank you, again, for the opportunity to speak with you this morning.   It is a positive step that we are here together, forging a path forward to combat this evolving global threat. “