IRE107: INTERNATIONAL SECURITY
Fall 2018 Session 10: Transnational Crime
Maya Hadar
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 The concept of Transnational Crime
 Contemporary Transnational Crime
 Typology and Scope, groups, operating techniques
 TOC in regional perspective
 Examples of Transnational Organized Crime
 Human trafficking
 Migrant smuggling
 Trans-national Mafias
 Illegal drug trafficking + Narcoterrorism
 International response to transnational crime
On the Agenda for Today
 Money laundering
 Crime and war economies
 Illicit antiquities trade
The Concept of ’Transnational Crime’
 Transnational crime =>
 “Offenses whose inception, prevention and/or
direct or indirect effects involved more than one
country” (UN,1995)
 Involves well-organized criminal operations that
cross national boundaries, but are not affiliated
with a major criminal organization
 Intrastate/national crimes that infringe
fundamental values of the international
community
The Concept of Transnational Crimes
 Crimes that have actual or potential effect across national borders
 A single perpetrator engaging in criminal activities that cross national
boundaries
 Sophisticated criminal transnational organizations
 No single, universally agreed upon definition of ‘Transnational organized
groups’ due do:
 Their Sheer number
 Diverse activities (legal and illegal)
 Loosely structured, flexible, and highly adaptable nature
The Concept of Transnational Crime
 Transnational crime ranges from simple fraudulent email and phishing
schemes perpetrated globally to illegal trafficking in people, human
organs, and illicit drugs
 Transnational crime is not a modern phenomenon- it has been
perpetrated for as long as borders have separated neighboring countries
 Yet, Transnational crime has emerged as one of the most pressing security
challenges of the early 21st century-
Contemporary Transnational Crime
“ Like legitimate business, transnational criminal enterprises are
embracing globalization by adopting new communication and
transportation technologies which allow them to pursue global markets”
(Center for Strategic and International Studies, 2001)
 What is new about transnational crime?
 Scope and magnitude of activity => The scope of activities has broadly
diversified (cybercrime, trade in human body parts, trafficking in flora and fauna, art
theft, etc.)
 Increasing global impact
Contemporary Transnational Crime
 Major issues affecting the rise of transnational organized crime:
 Globalization (in general) => distance and spatial boundaries have almost
become a non-issue
 Globalization of the economy (i.e., downfall of the Soviet Union & the
switch to a free-market economy in China)
 Emerging democracies
 Opening of borders for trade and travel => rising quantity & diversity of
immigrants
 Improved communications technology & seamless electronic environment
Typology and the Scope of OTC
Transnational Organized crime involves two types of activity:
1. Provision of illicit goods and services and/or
2. Infiltration of legitimate business
Cases/Categories
 Illicit drugs (Heroin, Cocaine etc.)
 Human trafficking
 Arms trafficking
 Terrorism
 Corruption, money laundering
 Piracy/maritime
Criminal Activities Organizations
Labour
Racketeering/extortion
Sicilian Mafia, Russian Mafia,
Chinese Triads
People trafficking Drug Cartels
Drug trafficking Conflict Goods Networks
Goods
trafficking/conflict goods
Mercenaries/private security firms
(‘Executive outcomes’)
Price-fixing Illegal migration network (Linked
to people trafficking)
Illegal gambling
Prostitution These may overlap
Extortion rings
Private terrorism
TOC in Regional perspective
Europe =>
 Austria: Groups from Albania and former Yugoslavia are involved in pimping,
drug trafficking and burglary.
 Denmark: Motorcycle gangs are the highest profile groups, involved in the
sale of firearms and amphetamines. Links with the Colombian cartels account
for a significant percentage of cocaine imports.
 Germany: Most groups are involved in drug trafficking, prostitution and
various theft rings. Only 7 of a total of 572 known organizations comprise
more than 100 members.
TOC in Regional perspective
Europe =>
 France: one of Europe’s main ‘drug routes’.
 Ireland: 8 main gangs, all based in Dublin. Principally involved in drug
trafficking and armed robbery.
 UK: Drug trafficking is the main activity. British gangs are often organized
along family lines and are also active in car theft, armed robbery and
forgery.
TOC in Regional perspective
Central Asia =>
 Developing countries rich in resources (such as water and oil), yet are
influenced by corrupt governments, longstanding ethnic divides, and a
geographic location between major drug producing regions
 At high risk for organized crime problems
South Africa =>
 Organized crime involve a loose and highly interchangeable association of
people
 Includes both government officials and businesses
Organized Groups
Pre-existing social or culturally-based groups =>
 Groups that have ongoing hierarchical structures from “bosses” to
“soldiers”
 Longstanding criminal activities due to their influence in a local area
 Socialize as a group and engage in neighborhood life apart from crime
(Mafia groups)
Organized Groups
Groups that emerge to exploit a specific criminal opportunity =>
 Small, inter-ethnic ad hoc groups with limited hierarchy and limited
group cohesiveness
 Networking among groups occurs when needed to carry out a criminal
activity (Russian Mafia, Ukraine, and South African groups)
Operating Techniques
International criminals use similar methods to execute their crimes:
 Violence
 Less visible techniques
 Communication via the internet, satellite phones
 Money laundering and corruption
Blending Formula
 Mixing legitimate and illegitimate activities => resources of terrorists/profits of
international organized crime are combined with legitimate funds, making it hard
to detect where criminal funds end and the legitimate funds begin
Blending Formula
Examples:
 1999 => Bank of New York case, involved billions $$$ emanating from
Russia, partially originating in transnational activities of Russian organized
crime
 Al Qaeda organizations uses charities to move money:
 Such funds are mostly directed toward social welfare activities in the community, but a
traditional 10% (or a much greater share), is used to support terrorists
Human Trafficking
 Human Trafficking
 The illegal sale or trading of persons across borders against their will (through
force, coercion, threat, or deception) for financial gain
 Often includes an element of smuggling
 Often an international crime => involving crossing borders but victims can be
trafficked within their own country
 Negative consequences:
 Fuels organized crime
 Deprives of human capital
 Undermines public health
 Subverts government authority
 Promotes social breakdown
Women’s Trafficking
 Trafficked women are abducted/duped, ‘broken’ by gangs, then prostituted to
pay an immigration debt or through threats to their safety/ their family’s
 Sub-saharan African women in Italy, women from the Balkans in the UK
 Different from prostitution: no consent, no money, high risks of battery, long
term mental health issues
 Fuels shadow economies linked to other illegal activities
 Children’s trafficking (males and females) for paedophile prostitution rings
 Estimate 700k women and children a year: core human security concern
 Points to failure of immigration regimes and prostitution laws
Migrant Smuggling
“The procurement, in order to obtain, directly or indirectly, a financial or other
material benefit, of the illegal entry of a person into a state party of which the
person is not a national or permanent resident”
(Article 3 of the UN Protocol against the Smuggling of Migrants by Land, Air & Sea)
 In contrast to human trafficking, migrant smuggling varies in one important
way – victimization
 The person involved “voluntarily” submits to being engaged in criminal
activity.
Migrant Smuggling
“The procurement, in order to obtain, directly or indirectly, a financial or other
material benefit, of the illegal entry of a person into a state party of which the
person is not a national or permanent resident”
(Article 3 of the UN Protocol against the Smuggling of Migrants by Land, Air & Sea)
 Factors such as economic deprivation, political instability and ethnic strife,
motivate individuals to illegally cross borders in search of a better life
 About 300k people are smuggled into western Europe each year (estimates)
 Russian migration officials estimate that up to 2 million Asian and African
illegals live in Russia
Trans-national Mafias
 ‘Export’ of illegal activities through immigrant links (e.g. Sicilian mafia in
the US)
 Cross-border illegal trade, use of open frontiers
 Case Study=> Russian Organised Crime
 Rampant growth since 1991 – economic liberalism has created new ‘entrepreneurs’
 Corruption
 Intimidation of businesses and public officials
 Money laundering and extra-judicial killings/assassinations
Trans-national Mafias
 Seen throughout Central and Eastern
Europe + US (Brighton Beach)
 Involved in prostitution and people
trafficking rings in Western Europe
(along with Eastern European gangs)
 Latin America, major producer of:
 Cocaine (Bolivia, Columbia, Peru)
 Heroin (Mexico)
 Marijuana (Mexico, Jamaica)
 Key economic sector – ‘shadow economy’
 Trans-border networks- focus on the US
market
 American ‘War on Drugs’ – defined as a
security threat and prompted significant
responses (e.g. Invasion of Panama 1989-90)
Congressional Research Service
Illegal Drug Trafficking
Illegal Drug Trafficking
UNODC (UN office on Drugs and Crime) World Drug Report 2018
Illegal Drug Trafficking
UNODC (UN office on Drugs and Crime) World Drug Report 2018
Illegal Drug Trafficking
 Not limited to the developing world:
 The Aum Shinrikyo cult, one of the largest producer/distributer of
methamphetamines in Japan was responsible for the 1995 gas attack on the
Tokyo subway
 Illegal drug trafficking constitutes the largest source of profits for both
international organized crime groups & terrorists:
 Trade in narcotics accounts for 2% of global economy (IMF)
 7% of international trade (UN)
 Link between terrorism and narcotics:
Drug cultivation, transport and distribution
are recurrently used to support terrorist
activities
 Phenomenon studied by policymakers and
scholars since the mid-1980s:
 Sendero Luminoso: a terrorist organization
that operated in conjunction with coca
producers in the high valleys of rural Peru
Narcoterrorism
Main cocaine trafficking routes to Europe.
Map: InSight Crime
 Late 1990s’ => US security community started to focus on “transnational
threats”
 Combination of narcotics trafficking, arms proliferation, organized crime, terrorism
+ cyberwarfare
 Narcoterrorism is also associated with:
 Combating the Medellin and Cali cartels + Colombian guerilla factions
 Combating the Tamil Tigers in Sri Lanka
 The rise of the Taliban and Al Qaeda in Afghanistan and the Islamic Movement of
Uzbekistan throughout the Central Asian Republics
Narcoterrorism
Money Laundering
 Movement of illicit funds for the purpose of
concealing the true source, ownership or use
of the funds => Money derived from criminal
activity is transformed into funds with a legal
source
 Money laundering provides the fuel for drug
dealers, terrorists, arms dealers and other
criminals to operate and expand their
enterprises
Money Laundering
 Rapid developments in financial information,
technology and communication allow money to
move anywhere in the world with speed and
ease => The task of combating moneylaundering
is thus challenging than ever
 The deeper "dirty money" gets into the
international banking system, the more
difficult it is to identify its origin
Money Laundering & Globalization
 Difficult to estimate the total amount of money that is laundered globally
 About 2 - 5% of global GDP, or $800 billion - $2 trillion
 Huge margin, but even if the lower estimate it true => serious problem
 It has become more difficult to find, freeze and forfeit criminally derived
income/assets due to developments in the international financial system:
 Dollarization (the use of the $$$ in transactions) of black markets
 General trend towards financial deregulation
 Progress of the Euromarket
 Proliferation of financial secrecy havens
The Money-Laundering Cycle
 Placement
 Physically moving funds into
financial institutions/retail economy
 Layering
 Multiple/complex financial
transactions are conducted to
further conceal their illegal nature
 Integration
 Illicit funds re-enter the economy
disguised as legitimate business
earnings (securities, businesses, real
estate)
Crime & War Economies
 Wars create ‘law and order’ vacuum which criminals fill:
 Sometimes black market economy is the only way to get basic goods during wars…
 Goods traffickers have a vested interest in the conflict not ending – they may become
actors in the conflict
 Other side of the coin:
 Parties in civil wars fund their activities through criminal activities
 Trans-border involvement to destabilise neighbours and exploit their
resources illegally (conflict diamonds in Sierra Leone)
Estimated Revenue from Conflict Resources, Selected Cases
Combatant Resource Period Estimated Revenue
UNITA (Angola) Diamonds 1992-2001 $4-4.2 billion
RUF
(Sierra Leone)
Diamonds 1990s $25-125 million/yr
Taylor (Liberia) Timber Late 1990s $100-187 million/yr
Sudan gvt Oil Since 1999 $400 million/yr
Rwanda
government
Coltan (from DRC) 1999-2000 $250 million
Taliban
(Afghanistan)
Opium, heroin Mid-1990s-2001 $30-40 million/yr
Northern Alliance
(Afghanistan)
Lapis lazuli, emeralds,
opium
Mid 1990s-2001 $ 60 mill/yr
Khmer Rouge
(Cambodia)
Timber Mid-1990s $120-140 million/yr
Cambodia gvt Timber Mid-1990s $100-150 million/yr
Burma gvt Timber 1990s $112 million year
FARC (Colombia) Cocaine Late 1990s $140 million/yr
Source: Michael Renner, The Anatomy of Resource Wars, Worldwatch Paper 162, October 2002, p. 7, Table 1.
Illicit Antiquities Trade
 The demand end is legal
 Remarkably high prices
 Buyers usually of prominent socioeconomic status
Looted Antiquities
 Recently looted (“Black”)
 Looted in the past, but now considered licit (“Gray”)
 Dug up and turned over to rightful owner (“White”)
Why looted antiquities are important?
 Link to other types of crime (e.g. drugs, terrorism)
 Links to organized crime
 Can use the antiquities to launder money
International Response to TOC
2003 => United Nations Convention Against Transnational Organized Crime
 Aimed at developing and monitoring binding agreements that target TOC
 Measures include:
 Criminalizing participation in a criminal group
 Money-laundering laws
 Extradition laws
 Mutual legal assistance
 Specific victim protection measures
 Law enforcement provisions
International Response to TOC
Supplementing UN protocols:
 Protocol to Prevent, Suppress and Punish Trafficking in Persons, Especially
Women and Children
 Protocol against the Smuggling of Migrants by Land, Sea and Air
 Protocol against the Illicit Manufacturing and Trafficking in Firearms, Their
Parts and Components and Ammunition
Further relevant International conventions:
 1976 => Declaration of Principles to combat the abuse of narcotic drugs
 1988 => Convention against Illicit Traffic in Narcotic Drugs and Psychotropic
Substances
 1997 => Association of Southeast Asian Nations Declaration on
Transnational Crime
 1998 => Manila Declaration on the Prevention and Control of Transnational
crime
 2000 => UN Convention against corruption
International Response to TOC
Next Session...
40
Security Cooperation
41
Thank You For Your Attention!
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