RESOURCE MATERIAL SERIES No. 58

GROUP 3
PHASE 1CURRENT SITUATION OF ORGANIZED CRIMES IN
TRAFFICKING STOLEN VEHICLES, CARD FRAUD, MONEY
LAUNDERING AND MAJOR TRANSNATIONAL ORGANIZEDCRIMINAL GROUPS
ChairmanCo- chairman
Rapporteur
Co-Rapporteur
Members

Advisors

Mr. Sanjiv Kumar Upadhyay
Mr. Takeshi Miyamoto
Mr.Zafar lqbal Gondal
Mr. Tomoyuki Yokokawa
Mr. Awunah Donald NgorNgor
Mr. Iddi Saidi King’wai
Ms.Mitsuyo Inada
Prof. Keiichi Aizawa
Prof. Yuichiro Tachi
Prof. Akihiro Nosaka

I. INTRODUCTION
In furtherance to the realisation of thecentral objective of 116th International
Training Course with the main theme‘Effective Methods to Combat
Transnational Organized Crime in
Criminal Justice Processes’, our Group was
assigned to analyse the current situationof the following topics:(i)Trafficking in Stolen Vehicles(ii) Card Fraud(iii) Money Laundering(iv) Major Transnational OrganizedGroupsIn the Course of our discussion, we relied
extensively on the country reports of theparticipants, course reference material,and facts emanating from our group
discussions. The scope of our deliberation
was centred on general overview of our
subject matter with particular reference tothe undermentioned countries:
(i)
Japan
(ii) India(iii) Nigeria

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(iv)
(v)

(India)(Japan)(Pakistan)(Japan)(Nigeria)(Tanzania)(Japan)(UNAFEI)(UNAFEI)(UNAFEI)

Pakistan
Tanzania

The Transnational Organized Crime has
assumed serious dimensions to engage thecollective attention of the international
community at large. Various United
Nations agencies and other world bodies
have deliberated on the issue of tacklingtransnational Organized crime, and theTransnational Criminal Organisations andhave come out with far reaching resolutions
and recommendations.
II. TRAFFICKING STOLENVEHICLES
A. Current situation
Over the past decade the rate of vehicle
ownership has risen considerably in all
countries and the incidence of illicit
trafficking of stolen vehicles has increased
correspondingly. The transnationalorganized criminal groups are playing amajor role in trafficking of vehicles. Thereis rapid growth and geographical expansionof this problem in Europe, America, Asia

116TH INTERNATIONAL TRAINING COURSEREPORTS OF THE COURSE
and Africa. The method of trafficking
varies from country to country. Threemethods have come to notice in the illicit
trafficking of stolen vehicles, namely,
stealing vehicles by duplicate keys,
diverting rental cars to foreign countries
and outright robbery of vehicles at
gunpoint. The stolen vehicles recovered in
African countries are of European,
American or Japanese origin. The
organized groups in the countries from
where the vehicles are trafficked have links
with the syndicates in the Africancountries. The vehicle trafficking is usuallyconducted using forged documents andshipping them as second hand vehicles,
where they are disposed for profit.
Similarly, illicit trafficking is also prevalent
within the African countries where thevehicles are stolen in one country anddriven across the border into anothercountry. In West: African sub-region, there
is a protocol for free movement of persons
and goods under the auspices of Economic
Community of West African States(ECOWAS). Criminals take undue
advantage of this policy to indulge intrafficking in stolen vehicles. On accountof harsh economic conditions in the West
African countries, most of the people can
not afford brand new vehicles and therefore
the sale of second-hand cars is a lucrative
business. Hence, fairly used vehicles are
smuggled into these countries from thewestern world. In Nigeria, these cars findtheir way into the country through theinternational borders of neigbouring West
African States.
Trafficking in stolen vehicles is also amajor problem in Bast African countries
where the modus operandi is similar.
Motor vehicles robbed from Tanzania andother countries of Great Lake Region andSouthern African Region have been
recovered in Uganda. In the same vien,
vehicles robbed in Uganda have been
recovered in other countries of the region.

In the year 1 999, a total number of 32
vehicles robbed from neighboring countries
were recovered from Uganda and 18
Ugandan registered vehicles wererecovered from neighboring countries.
In India, there is incidence of trafficking
of stolen vehicles to Nepal. However, there
is no such trafficking across the Indo-Pak
border, as the border control is strict. In
Pakistan, theft of vehicle is on the rise but
there is no significant problem oftransnational trafficking of stolen vehicles.
In Japan, the Boryokudan groups,
Myanmar nationals and Vietnamese are
involved in trafficking of stolen vehicles.
Boryokudans steal expensive vehicle andsmuggle them to Russia by sea route.
Myanmar nationals in Japan also adopt thesame method for smuggling vehicles to
Myanmar and Bangladesh. Besides, stolen
vehicles are being trafficked by Myanmargroup who also have a legitimate car export
business. The Vietnamese group in Japanis engaged in stealing Honda two wheelers
for trafficking to Vietnam.
III. CARD FRAUD
Credit cards have come a long way since
inception in mid sixties, and so have thefraudulent activities in credit cards. The
identifying features are laminated on aplastic material with logo and name of theissuing bank, identification number of the
cardholder, dates of issue and expiry, of the
cardholder and other essential features.
The forgerers have not found it too
daunting to counterfeit such a card nor
have the hackers found it impossible togenerate valid credit card accountnumbers. Multiple imprints of the credit
cards have been made to commit frauds.
Stolen or lost credit cards have been used
to enter into a transaction. There havebeen reports of a high-tech crime ring thatused a single computer chip to obtain credit

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RESOURCE MATERIAL SERIES No. 58
card numbers and personal information of
cardholders in Taiwan. Losses of $30.96
million in 1999 were 30% higher than in
the previous year in Taiwan. The easy
availability of the card-number generator
software makes it a popular modus
operandi for the hackers. With online
business transactions on the rise, the law
enforcement agencies have a daunting task
on hand in all countries in the next few
years. The credit card market has grown
fast in Asian countries in recent years. In
India where the average person is notcredit card friendly, the annual card
spending has grown to Rupees 70,000
million. Withe-commerce set to gainincreasing popularity, credit cards will
become centerpiece of banking andpersonal financial relationship. The losses
due to fraud in credit cards have occurredby the following categories:(i)Counterfeit
32%(ii) Lost cards
30%(iii) Stolen cards
20%(iv) Multiple imprint 5%(v) Mail/Tele orders
4%(vi) Others
9%
In Brazil, credit card fraud has becomea major problem. The fraud is mainly
perpetrated by cloning of credit cards. The
cloning is mostly done abroad where
equipment is freely available, whereas in
Brazil the sale of such equipment isprohibited.
In Malaysia, the modus operandi usedin credit card frauds is by using card
number generators, skimming, mail/telephone order and using fictitious
identity. Criminal groups have used Credit
Master and Credit Wizard Software toobtain credit card numbers using
computers and have produced forged credit
cards with identical bank identification
numbers. In the method of skimming,
skimmer machine has been used to extract
encoded data from a genuine card’s

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magnetic strip for making a counterfeit
card. In commission of fraud through Mail/
Telephone Order, counterfeit cards havebeen used for ordering goods/services via
telephone or mail at boarding houses,
vacant premises or motels. Sometimes,
credit card is obtained by using fictitious
identity and on receipt of the card, thefraudulent cardholders would embark on
a shopping spree. In 1998, there were 104
cases of card fraud involving RM1.49
million while in l999, there were 72 cases
involving losses of RM624,480.
The use of Credit Card is not well
pronounced in Nigeria, Tanzania andUganda at present. However, some
unscrupulous Nigerians, home and abroad,have been found to be involved incounterfeiting and theft of Credit Cards.
In the Philippines, there are Syndicateswith intricate knowledge of computers andit is not much difficult for them to hackbank transactions, manufacture
counterfeit credit cards or forge signatures.
There have been reported cases ofinternational gang operating in the fieldof credit card fraud. The Philippines PNPIntelligence Group was able to crack down
on credit card scamsters in a well
publicized case in 1997 with thecooperation of US Secret Service and
INTBRPOL. The syndicate had
successfully operated in the United States,
United Kingdom, Hong Kong and Thailand
earlier. The methods employed for cardfraud apart from skimming are as given
below:(i)
Courier-Interception Method: The
courier of the cards is bribed andthe data is extracted for
duplication of the cards.
(ii) Cardholder access: The cardholder
himself is bribed for permittingcloning of the cards.
(iii) Merchant Access: The personnel ofthe business company are bribed116TH INTERNATIONAL TRAINING COURSEREPORTS OF THE COURSE
to reveal information about theaccount numbers of the clients.
The account numbers are cloned
and operated by using fake
identification documents.
In Japan, credit card fraud throughcounterfeiting, theft and misuse is
becoming a serious problem. Organizedcriminal groups of Malaysian Chinese,
Boryokudans and Hong Kong nationals
have been found involved in credit cardfraud. Hong Kong and Chinese groups
possess a remarkable expertise in reading
secret security numbers and counterfeiting
cards within Japan. Besides, Iranians arereported to have indulged in Telephonecard fraud.
Evidently, advent of e-commerce andonline financial transactions has resulted
in increased propensity on part ofOrganized criminal groups to commit credit
card fraud as it provides anonymity andease in operation.
IV. MONEY LAUNDERING
Money laundering is an integral part ofTransnational Organized Crime. The
Transnational Criminal Organisations
have resorted to money laundering indifferent countries in an effort to legitimise
the proceeds of crime. The extent of money
laundering is difficult to estimate since it
is an illegal trade for which no statistics isavailable. A rough estimate is that about
2-5% of the global GDP is the dirty moneythat enters the capital market every year.
Experience in various countries shows thatthe general techniques to launder moneyare:(i)investing the dirty money m thelegitimate business either throughshell companies or throughgenuine companies in pseudo
name;(ii) acquisition of assets by paying therequisite taxes;(iii) deposit of money in banks in noncooperative countries andremittances through banking
channels to the host country;(iv) use of non-banking channels intransfer of money;(v) o v e r i n v o i c i n g o f g o o d s i nseemingly normal business
transactions;(vi) routing of money through tax
haven countries.
One of the popular methods ofremittance among the Asian communities
settled abroad who have to send money
back home is hundi or hawala, analternative non-banking remittancechannel. The money is deposited with thelocal agent, who sends instructions to his
counterpart in the native country to pay
the money to the recipient. This is a fastand convenient method for transfer ofmoney. This method is in vogue for anumber of years. It has also been used bymoney launderers since there is no audit
or accounting as the system works on trust.
For example, in China, Triads have used
this system and in India, Organizedcriminal gangs have used this system tolaunder their drug and illicit arms
proceeds.
In Brazil, international Mafia have usedghosts beneficiaries, front and fictitious
companies for money laundering. In India,
money laundering is indulged in bycorporate houses to evade taxes as well as
by the Organized criminal groups tolaunder dirty money. Money laundering
techniques include smurfing,establishment of front companies,
acquisition of commercial andnoncommercial properties, remittances
through Hawala (Non-banking channel),over-invoicing and double invoicing,legitimate business and foreign
remittances.

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Furthermore, in Nigeria, money
laundering has correlation with attempt tolegitimise the proceeds of crime byconcealing their true origin and ownership.
The Organized criminal groups involved in
drug trafficking repatriate money fromabroad by direct purchase and re-sale ofluxury items like cars and jewelry. The
other methods include over invoicing ofgoods and trading in stocks and shares.
In Pakistan, money laundering has
linkage with drug trafficking, smuggling,tax evasion and corruption. The methods
adopted, amongst others, include hawala,investment in real estate, over invoicing ofexports and under invoicing of imports.
There have been about ten cases ofmoney laundering in Japan since 1992
when the law on money laundering wasenacted. An Iranian group was reported
to have remitted proceeds of drugtrafficking to Middle East through banking
channels. Boryokudans have also indulged
in laundering of the proceeds of sale ofstimulant drugs. Chinese ’Snakeheads’
have used underground banks in their
human trafficking activities in Japan formoney laundering.
Undeniably, money laundering is an
essential financial activity of Transnational
Criminal Organisations to evade detectionand enjoy the proceeds of theirunwholesome activities. Therefore, the roleof authorities in pursuing the money trail
is becoming increasingly cumbersome.
V. MAJOR TRANSNATIONALORGANIZED CRIMINAL GROUPS
Transnational Organized crime has
spread its tentacles world wide
endangering the foundations of theinternational civilised society andcorrupting the political, social andeconomic systems. With rise of a global

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market for illicit drugs and firearms.
Transnational Criminal Organisations
have blossomed forning new alliances tothwart the efforts of the international
community to mount a crackdown on them.
Chinese Triads, Russian Mafia, Colombian
cartels, Japanese Boryokudans, Sicilian
Mafia, Nigerian Criminal Groups andTurkish drug traffickers have continued toremain out of reach of the law enforcement
authorities in different countries.
There are a few groups of Organizedcriminals that indulge in illicit drugtrafficking in Brazil. The Nigerian group
has developed a wide network of drugtraffickers who have operations in all partsof the world. They have close relationshipwith the Colombian cartels. The group getscocaine from neighbouring countries using
Nigerians as couriers. Italian Mafia too
indulges in drug trafficking using
Europeans as couriers.
Snakeheads are Chinese Mafia
indulging in illicit trafficking of humanbeings. They are operating in countries
wherever there are Chinese settlers. Someof the major transnational organized crimegroups operating in India are Dawood
Ibrahim Group, Chhota Rajan Group andBabloo Shrivastava Group. The mostdreaded group is the Dawood Ibrahimgroup, which has countrywide network andforeign connections. The group has
indulged in all types of Organized crime
like drug trafficking, firearms trafficking,money laundering, contract killings,
smuggling and extortion. The group has
acquired legitimate business activities inIndia, Hong Kong, Dubai and a few othercountries.
Another group is the Chhota Rajan, arenegade group of Dawood gang, whichparted ways after the 1993 serial bomb
blasts in Mumibai. The group is reported
to have a membership of about 800 persons.

116TH INTERNATIONAL TRAINING COURSEREPORTS OF THE COURSE
The major source of income of the gang isfrom drug trafficking and contract killings.
The third prominent group is the Babloo
Shrivastava gang, which indulges inkidnapping for ransom and contract
killings. They receive the ransom amountin foreign countries through hawala
channels. Although there may not be any
Nigerian criminal groups operating within
Nigeria, but the Nigerians are reported tobe members of Organized crime groups
abroad. The main activities are drugtrafficking, human trafficking and money
laundering. In Nigeria, the groups areloosely Organized syndicates but havecohesive characteristics.

about 83100 members. Their main
activities are ’protection money’, drugtrafficking, gambling and book making.
The Chinese Triads are indulging in drugtrafficking, firearms trafficking, humantrafficking and robbery. They have alliancewith Boryokudans in carrying out some of
their illegal activities. Chinese
Snakeheads are engaged in humansmuggling using forged documents.
Transnational criminal organisations
are invariably the canopy that nurturesand provides protection for theperpetrators of crime that havetransnational character and scope.
VI. CONCLUSION

There are a dozen of identified
transnational crme groups in thePhilippines namely, Alfred Trionko.
Lawrence Wang, Relly Barbon Gang, Solido
Group, Paracale gangs, Andres Manambit
Group, Chen Ling Tun, Chen Chi Chuing,
Wein Kuen Keung, Wong, Kuen Alan Tong,
Choo Yeh Leong and Yan Po Weng. Theirillegal activities include trafficking in
women and firearms and they haveconnections with Japanese Yakuza.

In summation, the phenomenal upsurge
in the international community of
trafficking in stolen vehicle, card fraud,money laundering coupled with the
emergence of transnational criminalorganizations across the globe demands
galvanized international effort to stem thetrend.

In Tanzania, Uganda and neighbouring
countries, criminals do not function in an
Organized pattern at present and crime ismostly perpetrated on individual basis.
In Thailand, criminal networks are
involved in trafficking in women. There
are at least seven families in Bangkok who
recruit, sell and smuggle Asian women for
prostitution throughout the world. Theyuse forged travel documents for suchtrafficking to U.S.A, Japan, Canada andAustralia.
The main Organized criminal groups
operating in Japan are Boryokudans,Chinese Triads and Chinese Snakeheads.
Boryokudans have 2500 organisations with

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