NATIONS HOSPITABLE TO ORGANIZED CRIME

AND TERRORISM

A Report Prepared by the Federal Research Division, 

Library of Congress 

under an Interagency Agreement with the 

United States Government 

October 2003 

 Authors: LaVerle Berry 

 Glenn E. Curtis 

 John N. Gibbs 

 Rex A. Hudson 

 Tara Karacan 

 Nina Kollars 

 Ramón Miró 

 Project Manager: Glenn E. Curtis 

 Federal Research Division

 Library of Congress

 Washington, D.C. 20540−4840

 Tel: 202−707−3900 

 Fax: 202−707−3920 

 E-Mail: frds@loc.gov

 Homepage: http://loc.gov/rr/frd/

p 55 Years of Service to the Federal Government p

1948 – 2003 
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PREFACE 

This report assesses conditions that contribute to or are potentially hospitable to 

transnational criminal activity and terrorist activity in selected regions of the world during the 

period 1999-2002. Although the focus of the report is on transnational activity, domestic 

criminal activity is recognized as a key foundation for transnational crime, especially as the 

forces of globalization intensify. 

The report has been arranged geographically into the following major headings: Africa, 

the former Soviet Union and Eastern Europe, South Asia, Southeast Asia, Western Europe, and 

the Western Hemisphere. Within the geographical headings, the report addresses individual 

countries with particularly salient conditions. Cases such as the Triborder Area (TBA) of South 

America and East and West Africa, where conditions largely overlap national borders, have been 

treated as regions rather than by imposing an artificial delineation by country. The bibliography 

has been divided into the same geographical headings as the text. 

The major sources for this report are recent periodical reports from Western and regional 

sources, Internet sites offering credible recent information, selected recent monographs, and 

personal communications with regional experts. Treatment of individual countries varies 

according to the extent and seriousness of conditions under study. Thus some countries in a 

region are not discussed, and others are discussed only from the perspective of one or two 

pertinent activities or conditions. Because they border the United States, Canada and Mexico 

have received especially extensive treatment. 
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TABLE OF CONTENTS 

PREFACE........................................................................................................................................ i

INTRODUCTION .......................................................................................................................... 1

AFRICA.......................................................................................................................................... 2

LaVerle Berry and Glenn E. Curtis

Introduction............................................................................................................................... 2 

North Africa .............................................................................................................................. 4

Algeria................................................................................................................................. 4

Egypt ................................................................................................................................... 5 

Morocco .............................................................................................................................. 6

Sub-Saharan Africa................................................................................................................... 9 

Eastern Africa ..................................................................................................................... 9

Contributing Factors ..................................................................................................... 9 

Arms Trafficking ........................................................................................................ 12 

Narcotics Trafficking.................................................................................................. 14 

Trafficking in Humans................................................................................................ 16 

Corruption................................................................................................................... 17

Money Laundering...................................................................................................... 17 

Terrorist Activity ........................................................................................................ 18 

Southern Africa ................................................................................................................. 19 

Mozambique ............................................................................................................... 20 

South Africa ................................................................................................................ 22

Western Africa .................................................................................................................. 27

Introduction................................................................................................................. 27

Narcotics Trafficking.................................................................................................. 27 

Human Trafficking...................................................................................................... 28 

Arms Trafficking ........................................................................................................ 30 

The Liberia Problem ................................................................................................... 31

FORMER SOVIET UNION AND EASTERN EUROPE............................................................ 32

Glenn E. Curtis

Introduction............................................................................................................................. 32 

Albania.................................................................................................................................... 33 

Former Warsaw Pact European Nations................................................................................. 36

Bulgaria ............................................................................................................................ 37

The Czech Republic........................................................................................................... 42 

Hungary ............................................................................................................................ 43 

Poland............................................................................................................................... 44 

Romania ............................................................................................................................ 45 

Slovakia............................................................................................................................. 46

Nations of the Former Soviet Union....................................................................................... 47 

The Baltic States ............................................................................................................... 47 

Estonia......................................................................................................................... 48 
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Latvia .......................................................................................................................... 49 

Lithuania ..................................................................................................................... 53 

Belarus.............................................................................................................................. 54 

The Caucasus Republics................................................................................................... 56 

Armenia....................................................................................................................... 57 

Azerbaijan................................................................................................................... 58

Georgia........................................................................................................................ 59 

The Central Asian Republics ............................................................................................ 60 

Kazakhstan.................................................................................................................. 61 

Kyrgyzstan .................................................................................................................. 62 

Tajikistan..................................................................................................................... 64 

Turkmenistan .............................................................................................................. 65

Uzbekistan................................................................................................................... 66

Moldova ............................................................................................................................ 66 

Russia................................................................................................................................ 68 

Ukraine ............................................................................................................................. 73

The Former Yugoslavia .......................................................................................................... 77 

Bosnia and Herzegovina................................................................................................... 78 

Croatia .............................................................................................................................. 80 

Kosovo............................................................................................................................... 82 

Macedonia......................................................................................................................... 84 

Serbia and Montenegro..................................................................................................... 86 

Conclusion .............................................................................................................................. 88

SOUTH ASIA............................................................................................................................... 89

Tara Karacan

Introduction............................................................................................................................. 89 

Bangladesh.............................................................................................................................. 91

Role of Government .......................................................................................................... 91 

Arms Availability and Insurgent Alliances....................................................................... 92 

India ........................................................................................................................................ 93 

Destabilizing Factors........................................................................................................ 94 

Regional Insurgencies and Conflicts................................................................................ 94 

Organized Crime............................................................................................................... 96 

Corruption......................................................................................................................... 99 

Government-Sanctioned Sectarian Violence .................................................................. 100 

Nepal..................................................................................................................................... 100 

Pakistan................................................................................................................................. 101

Terrorism and Destabilization Movements..................................................................... 102 

Trafficking Activities....................................................................................................... 104 

Sri Lanka............................................................................................................................... 105 

Liberation Tigers of Tamil Eelam (LTTE)...................................................................... 106 

Organized Crime Activity ............................................................................................... 106

SOUTHEAST ASIA................................................................................................................... 107

Nina Kollars
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Indonesia............................................................................................................................... 108 

Terrorist Activity............................................................................................................. 108 

Contributing Factors ...................................................................................................... 109 

Transnational Crime....................................................................................................... 111 

Malaysia................................................................................................................................ 112 

Terrorist Activity............................................................................................................. 112 

Transnational Crime....................................................................................................... 113 

Philippines............................................................................................................................. 113 

Terrorist Activity............................................................................................................. 114 

Transnational Crime....................................................................................................... 115 

Contributing Factors ...................................................................................................... 117 

Thailand ................................................................................................................................ 118 

Transnational Crime....................................................................................................... 118 

Terrorist Activities.......................................................................................................... 122 

Singapore .............................................................................................................................. 122

WESTERN EUROPE AND TURKEY ...................................................................................... 123

Tara Karacan

Introduction: Conditions in Western Europe ........................................................................ 123 

Belgium................................................................................................................................. 126 

Cyprus and Monaco .............................................................................................................. 128

France.................................................................................................................................... 130 

Germany................................................................................................................................ 131

Great Britain.......................................................................................................................... 132 

Greece ................................................................................................................................... 134 

Italy ....................................................................................................................................... 137 

The Netherlands.................................................................................................................... 139 

Spain ..................................................................................................................................... 140 

Turkey................................................................................................................................... 142

Conclusion ............................................................................................................................ 144

WESTERN HEMISPHERE........................................................................................................ 144 

Canada................................................................................................................................... 145

John N. Gibbs

Introduction..................................................................................................................... 145 

Contributing Factors ...................................................................................................... 146 

Terrorist Activity............................................................................................................. 149 

Transnational Criminal Activity ..................................................................................... 149 

Recent Developments...................................................................................................... 152 

Conclusion ...................................................................................................................... 154 

Colombia............................................................................................................................... 155

Rex Hudson

Introduction..................................................................................................................... 155 

Contributing Factors ...................................................................................................... 155 

Geographical Factors ................................................................................................ 155 

Institutional Factors .................................................................................................. 156 
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Economic Factors...................................................................................................... 157 

Narcotics......................................................................................................................... 158 

Paramilitary Groups....................................................................................................... 159 

Transnational Narcotics Ties.......................................................................................... 160 

Non-Indigenous Organized Crime.................................................................................. 161 

Terrorist Groups............................................................................................................. 162 

Conclusion ...................................................................................................................... 163 

Mexico .................................................................................................................................. 163

Ramón Miró

Introduction..................................................................................................................... 163 

Factors in Organized Crime and Terrorism................................................................... 164 

Border Control .......................................................................................................... 164 

The Indigenous Criminal Infrastructure.................................................................... 165 

Institutionalized Corruption...................................................................................... 166 

Criminal Activity............................................................................................................. 168 

Finance-Related Crime ............................................................................................. 168 

Narcotics ................................................................................................................... 169

Trafficking in Consumer Goods ............................................................................... 171 

Terrorist Activity............................................................................................................. 171 

Conclusion ...................................................................................................................... 173 

The Triborder Region ........................................................................................................... 173

Rex Hudson

Introduction..................................................................................................................... 173 

Factors in Organized Crime and Terrorism................................................................... 174 

Geographical Factors ................................................................................................ 174 

Societal Factors......................................................................................................... 175 

Economic Factors...................................................................................................... 176 

Immigration Control ................................................................................................. 177 

Government Corruption............................................................................................ 178 

Police Corruption...................................................................................................... 180 

Organized Crime............................................................................................................. 182 

Indigenous Groups.................................................................................................... 182 

Non-Indigenous Mafias ............................................................................................ 184 

Narcotics and Arms Trafficking ............................................................................... 187 

Money Laundering.................................................................................................... 188 

Other Organized Crime Activities ............................................................................ 190 

Islamic Terrorist Activities ............................................................................................. 191 

Islamic Money Laundering and Other Fund-Raising ............................................... 193 

Links of Hizballah and al Qaeda............................................................................... 194 

Conclusion ...................................................................................................................... 195

BIBLIOGRAPHIES.................................................................................................................... 197

Africa .................................................................................................................................... 197

Former Soviet Union and Eastern Europe ............................................................................ 203

South Asia............................................................................................................................. 218 

Southeast Asia....................................................................................................................... 222 
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Western Europe..................................................................................................................... 231

Western Hemisphere............................................................................................................. 235
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INTRODUCTION 

As organized crime and terrorist groups have globalized and diversified their operations 

in the past decade, they have based their activities in countries offering conditions most 

favorable to survival and expansion. Mobility, an important new characteristic of most such 

groups, has given groups a wider selection of operational bases and the ability to respond faster 

to changes that are unfavorable to their operations. 

The main domestic elements making a nation “hospitable” to transnational crime and 

terrorism are official corruption, incomplete or weak legislation, poor enforcement of existing 

laws, non-transparent financial institutions, unfavorable economic conditions, lack of respect for 

the rule of law in society, and poorly guarded national borders. In some cases, several of those 

conditions arise together from a lack of political will to establish the rule of law. In turn, such a 

lack can derive from weak national institutions or from high-level corruption. A failing national 

economy often is an influential background factor that increases domestic and transnational 

criminal activity in a country. Such purely domestic factors often are exacerbated by a nation’s 

geographic location (along a key narcotics trafficking route or in a region where arms trafficking 

is prolific, for example), or the influence of regional geopolitical issues such as a long-standing 

territorial dispute. 

The reach of transnational crime and terrorism is increasing for many of the same reasons 

that the reach of legitimate business is expanding. Many of the regions discussed in this report 

are touched by criminal or terrorist activity from other regions of the world. For example, the 

starting point of arms trafficking in Africa often is weapons supplies in Eastern Europe and the 

former Soviet Union, and the trafficking of narcotics and human beings covers long distances 

from Asia and Africa to Western Europe and North America. Intermediary agents often are 

involved in transit countries along the routes. This globalization has brought about greatly 

increased cooperation and sophistication among criminal groups based in different parts of the 

world. In recent years, terrorist groups also have proven that their reach is worldwide, as they 

benefit from some of the same conditions that make nations hospitable to organized crime. 

Evidence shows, for example, that terrorist groups based in the Middle East have established 

connections in several other continents. 
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This report uses the term “trafficking” to refer to two categories of illegal transnational 

movement of people: the buying and selling of women and children for illegal labor and for the 

sex trade, and the movement of illegal migrants through or into countries without fulfilling the 

documentation requirements of those countries. Although the second activity often is called 

“smuggling,” transnational criminal groups view both activities as the movement of a profitbearing commodity. For that reason, this report refers to all transnational movement of illegal 

people or goods as “trafficking.” 

AFRICA 

Introduction 

In the past decade, the continent of Africa has been the scene of violent acts and planning 

operations by terrorist groups, as well as many types of “conventional” transnational crimes. In 

December 2000, an interagency law enforcement working group in the U.S. Government issued 

a report, International Crime Threat Assessment, that described the African climate for 

international organized crime and terrorism as follows: 

Porous borders, ample routes for smuggling drugs, weapons, explosives, and other 

contraband, and corruptible police and security forces make Sub-Saharan Africa an 

inviting operational environment for international criminals, drug traffickers, and 

terrorists. Major Sub-Saharan cities with extensive commercial, financial, and sea and air 

transportation links to Europe, the Middle East, and Asia are hubs for international 

criminal activity. . . . These include Nairobi and Mombasa in Kenya, Addis Ababa in 

Ethiopia, Abidjan in C^te d’Ivoire, Johannesburg in South Africa, and Lagos in Nigeria.1

Several other factors, common to almost every country on the continent, could also be 

cited. In the most general terms, these are the endemic weaknesses of state institutions and 

loyalties, transnational ethnic networks, and widespread poverty.2

 Other factors come into play 

on a regional or country basis. 

Most states in Africa offer multiple opportunities and provide few constraints on criminal 

behavior, whether that behavior is displayed by traditional criminal organizations or by corrupt 

 

1

 U.S. Government, International Crime Threat Assessment (Washington: 2000), 34. <http://clinton4. nara.gov> 2

 These factors are discussed in any number of sources on contemporary Africa. This discussion is based largely on 

Phil Williams and Doug Brooks, “Captured, Criminal , and Contested States: Organised Crime and Africa in the 

Twenty-First Century,” South African Journal of International Affairs, 6, no. 2 ( Winter 1999), 86-96. 
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political elites. Nation-states in Africa are almost all multi-ethnic entities in which local 

populations affect at best only embryonic allegiance to the nation as opposed to clan, tribe, or 

kin. In such states, integrative national institutions tend to be poorly developed, and they are 

often conceived of as ”prizes” to be won and exploited rather than as forums for national 

government. There is often limited or no capacity to effect policy intervention in economy and 

society. Criminal justice systems are also often inadequate with respect to legislation to control 

or prevent racketeering and money laundering and to mandate punishment requisite to the crime 

committed. Police capacity and commitment to fight crime may be similarly limited. 

Corruption is particularly pervasive and entrenched in many African states. This 

condition manifests itself many ways, often in collusive relationships between criminals and the 

elites in control of the state. In many cases, corruption is a natural outgrowth of the social and 

cultural practices that characterize the patrimonial state in Africa—a type of organization in 

which personal and/or patron-client ties, rather than prescriptive criteria or elections, determine 

the allocation of resources (and often of public office). 

Another manifestation of weak states is porous borders and weak border controls. The 

extensive land and sea boundaries of many African states often are virtually unpatrolled. Many 

points of entry cannot be monitored by states with limited resources, resulting in opportunities 

for illegal immigration and constituting entry points for organized criminals. Customs and 

immigration services generally are poorly developed, trained, equipped, and paid. As such, they 

are readily circumvented or intimated by the relatively sophisticated methods employed by drug 

dealers and others who can offer bribes and have access to speedboats and overwhelming 

firepower. 

Transnational ethnic networks are a natural outgrowth of artificial, colonial-era borders 

that divide ethnic groups in virtually all African countries. Local populations move back and 

forth freely across such borders. The resulting transnational networks readily transport stolen or 

illicit goods. Foreign communities resident in a given country also may form networks that often 

control legal commerce, but they may also protect well-established trafficking networks that 

channel illegal commodities between the host country in Africa and the home country abroad. 

Such networks exist among Chinese, Indian, Nigerian, and Russian communities in southern 

Africa and among Indian and Middle Eastern groups in East and West Africa. Such networks 
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have come to characterize religious communities that may be ethnically based or trans-ethnic in 

composition, such as Muslims in coastal East Africa and in large parts of West Africa. 

A final factor is poverty in the starkest economic sense. By Western standards, most 

Africans are incredibly poor. Vast areas of the continent are poorly endowed with natural 

resources; soils often are infertile and difficult to work, and the climate of many countries offers 

unpredictable and insufficient rain. In such conditions, legal economic activity may offer limited 

opportunities for wealth and upward mobility. The temptation to turn to various forms of illicit 

activity to earn a living or simply to survive can become overwhelming. This temptation is made 

even greater by the extremes of wealth and poverty that exist between a small elite and the 

impoverished majority in all African countries, particularly in cities. Such illicit activity includes 

individual and organized fraud, robbery, and illegal trafficking, all of which provide fertile 

ground for transnational exploitation and connections. At least some members of the continent’s 

elite acquired their wealth by following this path. 

North Africa 

With the exception of Egypt and Morocco, the nations at North Africa’s “corners” closest 

to the Middle East and Europe respectively, North Africa has not included important transit, 

origination, or destination points for the transnational trafficking of arms, narcotics, or people. In 

recent years, Morocco has suffered rapid expansion of its narcotics export activity, which has 

become linked with Islamic fundamentalist groups. In recent years, Algeria, Egypt, and Morocco 

have been the most fertile countries of the region for terrorist groups. 

Algeria 

Algeria has a rich history of activity by terrorist groups, dating to the country’s bloody 

war for independence from France between 1956 and 1962. According to the U.S. Department of 

State, since the early 1990s government enforcement has effectively reduced the level of 

terrorist-related violence in Algeria, although individual acts still occur outside Algiers, the 

capital city.3

 

3

 U.S. Department of State, Patterns of Global Terrorism 2002. 

<http://www.usis.usemb.se/terror/rpt2002/middle_east_overview.html> 
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The main terrorist group emanating from the revolutionary years is the Armed Islamic 

Group (Groupe Islamique Armé, GIA), a loosely organized movement that surfaced in 1992 as a 

radical branch of Algeria’s main Islamic party, the Islamic Salvation Front. The overall aim of 

the organization, which is made up of highly autonomous cells, is to replace the secular 

government of Algeria with an Islamic state, using violent means if necessary. After a spate of 

terrorist killings in the mid-1990s, the GIA has been credited with occasional bombings in recent 

years, including a series of attacks in Paris in the mid-1990s. Current membership is estimated at 

between several hundred and several thousand individuals. Some members are believed to have 

joined other Islamic extremist groups, but current information about the GIA is scarce.4

No direct link between the GIA and al Qaeda has been identified, although al Qaeda has 

some Algerian operatives. In addition, some GIA leaders may have been in contact with Osama 

bin Laden in the 1980s, during the campaign against Soviet occupation of Afghanistan. GIA’s 

goals and activities seem to be confined mainly to Algeria. However, some terrorism experts 

have speculated that a national Islamist movement such as the GIA would be a likely source for 

al Qaeda to reinvigorate its operations.5

In 1998 GIA was eclipsed by the Salafist Group for Call and Combat (GSPC) as the 

largest and most active terrorist organization in Algeria. The size and structure of the GSPC’s 

membership and support networks are unknown. Attacks mainly focus on government and 

military targets in rural areas. For such attacks, the GSPC reportedly receives weapons and 

equipment from Islamic extremist groups in southern Algeria and has links with traffickers 

within and outside Algeria. GSPC members reportedly maintain contact in Europe with other 

North African Islamic groups sympathetic to al Qaeda.6

Egypt 

Two major Islamic terrorist groups, Jamaat al-Islamiyya and Islamic Jihad, have been 

based in Egypt since the 1970s. Both groups have contributed members and leaders to al Qaeda, 

including top functionaries Ayman al-Zawahiri and Muhammad Atef, and many members of the 

 

4

 Council on Foreign Relations and Markle Foundation, “Armed Islamic Group: Algeria, Islamists.” 

<http://www.terrorismanswers.com/groups/gia.htm> 

5

 Council on Foreign Relations and Markle Foundation, “Armed Islamic Group: Algeria, Islamists.” 

6

 U.S. Department of State and Federation of American Scientists, Intelligence Resource Program, “Salafist Group 

for Call and Combat (GSPC).” <http://www.fas.org/irp/world/para/salaf.htm> 
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two groups attended Taliban training facilities in Afghanistan. Jumaat al-Islamiyya has a 

worldwide membership; within Egypt the group has observed a 1999 cease-fire with the 

government, but the activity of individual members has continued in other countries. Islamic 

Jihad carried out the 1981 assassination of Egyptian president Anwar Sadat and attempted to 

assassinate government officials in the early 1990s. The organization has operated mainly 

outside Egypt in recent years; it was implicated in the attacks of September 11, 2001. The 

Muslim Brotherhood, from which both Jamaat al-Islamiyya and Islamic Jihad sprang, is a 70-

year-old, grassroots Islamic social and political organization based in Egypt. The Muslim 

Brotherhood has not been linked with recent terrorist activity, and several members represent 

their organization in the national parliament.7

Beginning in the late 1990s, the activity of terrorist groups in Egypt has been limited 

substantially by harsh reprisals, mass arrests, and financial crackdowns instituted by the Mubarak 

government.8

 The last major terrorist attack occurred at Luxor in November 1997. However, the 

government has not dealt effectively with Egypt’s long-term economic crisis, which combines 

with a high birth rate to foster social unrest and yield new recruits for the terrorist ranks. Some 

experts have argued that, under those conditions, Mubarak’s “iron fist” policy against terrorism 

in fact exacerbates conditions that produce violent measures against the government. The 

terrorist acts of the 1990s themselves worsened economic conditions by severely damaging 

Egypt’s vital tourism industry.9

Morocco 

Morocco’s participation in transnational narcotics trafficking is based on the country’s 

status as the world’s largest exporter of cannabis. In 2002 an estimated 75 percent of Morocco’s 

total output of 2,000 tons was trafficked into Europe, accounting for an estimated 70 percent of 

the cannabis products entering Europe. Experts believe that cannabis cultivation, which already 

 

7

 Council on Foreign Relations and Markle Foundation, “Jamaat al-Islamiyya, Egyptian Islamic Jihad: Egypt, 

Islamists.” http://www.terrorismanswers.com/groups/jamaat.htm> 

8

 Council on Foreign Relations and Markle Foundation, “Jamaat al-Islamiyya, Egyptian Islamic Jihad: Egypt, 

Islamists.” 

9

 Marc David Turetzky, “Egypt, Mubarak, and the Rise of Islamic Fundamentalist Terrorism, 1981-1994: An 

Empirical Analysis of the Mubarak Regime’s Punitive Counter-Terrorist Policy,” Michigan Journal of Political 

Science, no. 24 (Winter 1998). <http://www.umich.edu/~mjps/archives/issue24/turetzky24.htm> 
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is the most important economic activity in northern Morocco, is expanding rapidly.10 The trade 

in hashish resin and oil that is prepared from cannabis is Morocco’s largest single source of 

foreign currency. The high profitability of cannabis cultivation compared with cultivation of 

legal crops is a strong stimulus for growers to continue cultivating and for the government to 

tolerate such enterprises. In Morocco cannabis also has the advantage of being a highly droughtresistant crop.11

According to international narcotics trade expert Alain Labrousse, Morocco’s cannabis 

exporters constitute one of Africa’s two well-organized narcotics trafficking networks (the other 

is Nigeria’s).12 Cannabis products move from Morocco to Spain, thence into the rest of Europe, 

via the Mediterranean ports of Oued Lalou, Martil, and Bou Ahmed. Vehicles containing 

cannabis also reach Spain by ferry from the Spanish enclaves of Ceuta and Melilla. Some 

cannabis also moves overland to ports in Western Africa.13

The government’s role in the narcotics trade occasionally has extended beyond benign 

neglect. In 2000 a Moroccan newspaper linked the head of King Hassan’s security services with 

a Moroccan trafficker arrested in Spain, and the bribing of local police and customs officials is 

an accepted procedure for traffickers.14 International pressure on Morocco’s government to 

curtail transnational cannabis trafficking is mitigated by Morocco’s role as a primary bulwark 

against Islamic fundamentalism in the Muslim world. 

Meanwhile, northern Morocco’s drug trade is the nucleus of a dangerously autonomous 

and lawless enclave. Narcotics traffickers have entered symbiotic relationships with Islamic 

groups in and around the port of Tangier. Although they remain organizationally separate, the 

traffickers and the religious extremists share tactics and a deep distrust of the secular 

government, which opposes Muslim participation in government (Islamic groups have been 

repressed harshly) and has attempted to manipulate rival narcotics trafficking groups. According 

to a 2001 Middle East Report: 

 

10 For example, international narcotics trade expert Alain Labrousse says Morocco’s area of cannabis cultivation 

“has increased enormously,” interview by Frederic Dorce, reported in Jeune Afrique Economie [Paris], 16 December 

2002-19 January 2003 (FBIS Document AFP20030108000224). 

11 U.S. Department of State, Bureau for International Narcotics and Law Enforcement Affairs, International 

Narcotics Control Strategy Report 2003 (Washington, D.C.: Department of State, 2003), X-37-38. 12 Labrousse, in Dorce interview. 

13 U.S. Department of State, Bureau of International Narcotics and Law Enforcement Affairs, X-37-38. 

14 James Ketterer, “Networks of Discontent in Northern Morocco,” Middle East Report, no. 218 (Spring 2001). 

<http://www.merip.org/mer/mer218/218_ketterer.htm> 
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Drug traffickers, contraband smugglers, prostitution rings, the chronic unemployed, 

Islamists and other groups in Tangier have built up elaborate networks based on illegal 

commerce, political opposition, corruption and violent protest that have infiltrated the 

local political system and now challenge the state’s power in northern Morocco. Periodic 

attempts to control these informal networks have largely been unsuccessful.... Although 

informal, these networks are highly organized.15

Morocco is a transit point and a destination for transnational trafficking of women into 

the sex industry, as well as a starting point for trafficking illegal migrants into Europe. The eightmile distance across the Mediterranean from Morocco to Spain is a key geographical factor, as 

Spain is the first step for both types of trafficking in people. In 2001 the government of Morocco 

claimed to have dismantled 400 networks that were smuggling illegal migrants, but the 

government of Spain has asserted that Morocco’s enforcement measures are insufficient to stop 

the illegal entries.16 According to the U.S. Department of State, in 2002 Morocco did not have a 

law specifically prohibiting trafficking in people. The country’s resources for dealing with such 

crimes are limited, border controls are insufficient, and police complicity in cross-border 

trafficking has been observed.17 Morocco also has been unable to reduce the substantial 

incidence of domestic forced prostitution, often run by criminal groups, that is concentrated 

around tourist centers and military bases.18 An estimated 200,000 women work as prostitutes in 

Morocco.19

Morocco’s status as a relatively terror-free nation was shattered in May 2003, when a 

series of bomb attacks in Calcutta killed 41 people. Authorities attributed the attacks to a littleknown domestically based Salafist organization having links to al Qaeda. This was the first such 

attack in Morocco since 1995.20

 

15 Ketterer. 

16 “A Human Rights Report on Trafficking of Persons, Especially Women and Children: Morocco.” 

<http://209.190.246.239/ver2/cr/Morocco.pdf> 

17 U.S. Department of State, Trafficking in Persons Report 2002. <http://www.state.gov/g/tip/rls/tiprpt/2002> 18 Global March, “Worst Forms of Child Labour Data 2002: Morocco.” www.globalmarch.org/worstformsreport/ 

world/morocco.html. 19 “A Human Rights Report on Trafficking of Persons, Especially Women and Children: Morocco.” 

20 Adrian Croft, “Radical Muslim Link to Morocco Blast,” The Age [Melbourne], 19 May 2003. 

<http://www.theage.com.au/articles/2003/05/18/1053196472643.htm> 
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Sub-Saharan Africa 

Eastern Africa 

In the past decade, Eastern Africa has been the scene of several major terrorist acts, and 

populations in the region reportedly support terrorist planning and supply cells. Several forms of 

transnational crime are rampant in the region as well. The countries of Eastern Africa offer all of 

the advantages to international criminals and terrorists mentioned in the general overview of 

Africa: weak state institutions, corrupt politicians and law enforcement personnel, porous 

borders, ethnic groups with ties in neighboring and foreign states, and high levels of poverty. Of 

all such factors, however, the most important element may be the region’s geographical position 

along the eastern coast of Africa, on trade routes that for more than a millennium have linked 

South Asia with the African continent. 

Contributing Factors

In recent years, many nations of East Africa have been plagued by domestic and 

transnational upheavals that have destabilized borders and weakened law enforcement in both the 

nations directly affected and their more stable neighbors. Sudan has endured a lengthy 

insurgency, Somalia is an agglomeration of rival groups without a national government, Ethiopia 

and Eritrea have been at war often, and the Great Lakes District has been plagued by inter-tribal 

brutality in Rwanda and Burundi and insurgent movements in eastern Congo. International 

traffickers in narcotics, human beings, and arms have found this environment favorable for their 

enterprises. The more stable nations of the region—Kenya, Tanzania, and Uganda—have 

suffered from the instability surrounding them as well as from domestic corruption and law 

enforcement insufficiencies. Smugglers and terrorists are attracted to East Africa because of its 

geographic proximity to the Middle East and South Asia, its long coastline that is difficult to 

control, regular airline service to Europe and North America, and sizeable and increasingly 

radicalized Muslim communities. 

Poverty is a major factor in all the countries of the region. Most of Somalia is arid or 

semi-arid desert that provides few natural resources. Most Somalis are shepherds; sedentary 

agriculture is practiced in some areas, but no industry has functioned since the breakdown of 
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civil order in the early 1990s.21 The lack of gainful employment causes the young to enroll in 

local militias or leave to find work in neighboring countries or in the Middle East. 

In 1997 a survey by the government of Kenya showed that more than one-half of the 

population was below the government’s standard for absolute poverty, and that in the 1990s 

poverty was spreading from rural areas into urban centers.22 This trend has been accelerated by 

Kenya’s very high birth rate, especially in the 1980s. The large age cohorts produced during that 

decade now are coming of age, finding no employment, and contributing to an environment of 

rising street crime and desperation in Kenya society. Said a resident of one of Nairobi’s Muslim 

neighborhoods, “If a bomber came to my house and asked to stay, I would say, ‘A salaam 

aleikum’ [peace be with you], my brother, especially I if it might help us out, financially 

speaking.”23 British terrorism expert Danna Harman has predicted that as Kenya’s economic 

woes persist, the Muslim population probably will become more susceptible to Islamic 

radicalization, a situation that in turn may facilitate yet more acts of terrorism.24 Tanzania shares 

many of Kenya’s economic problems. It is economically underdeveloped and more than onethird of the population falls below the government-defined poverty line.25

Somalia, Kenya, and to a lesser extent Tanzania, lie astride one of the most convenient 

transit routes between South and Southeast Asia on the one hand and Europe and North America 

on the other. The coasts of those countries are perhaps the most attractive stretch of an age-old 

2,000-mile commercial arc that stretches from India along the Arabian and African coasts as far 

as Mozambique and the Comoro Islands.26

The East African coast is open, poorly patrolled, and easily accessible to small watercraft 

that can make landfall almost at will. Together with the population, urban settlements, and 

infrastructure of the mainland, the coast offers great advantages for legitimate traders as well as 

smugglers seeking access to world markets with a minimum of risk. 

 

21 Economist Intelligence Unit, Eritrea, Somalia, Djibouti: Country Profile 2001 (London: 2001), 36-40; Ken 

Menkhaus, “Political Islam in Somalia,” Middle East Policy, 9, no. 1 (March 2002), 121-122. 22 Kenya, Ministry of Finance and Planning, Second Report on Poverty in Kenya. Vol. I: Incidence and Depth of 

Poverty (Nairobi: 2000), 46. 23 Danna Harman, “Why Radicals Find Fertile Ground in Moderate Kenya,” Christian Science Monitor, December 

6, 2002, 8. 

24 Harman. 

25 Economist Intelligence Unit, Tanzania, Comoros: Country Profile 2002 (London: 2002), 14-17, 20ff. 26 U.S. Department of State, International Narcotics Control Strategy Report 2003, X-25, X-27, X-61, and X-62. 
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Kenya has long and porous land borders, which offer easy entry and exit for legitimate 

merchants as well as traffickers and terrorists. The border with Somalia is a case in point. That 

unmarked frontier runs through semi-desert territory that is virtually impossible to patrol. Police 

and customs posts are quite easily circumvented by detouring through adjacent scrub cover. The 

boundaries with Tanzania and Uganda are better demarcated but still difficult to patrol in their 

entirety. 

Tanzania’s coast, which has numerous natural harbors that facilitate trade and smuggling, 

is even more poorly patrolled than Kenya’s. Tanzania also suffers from long and porous land 

borders. The country has minimal institutional capacity to combat narcotics trafficking and other 

criminal activity. Few resources are available to law enforcement agencies, and Tanzania’s 

police and coastal defense forces are poorly trained and equipped.27

Kenya and some of its East African neighbors have based their national economies 

heavily on the tourist industry, attracting large concentrations of Westerners who present inviting 

targets for Islamic fundamentalist terrorists.28 Kenya’s beaches and game parks attract nearly 

500,000 foreign visitors annually. Nairobi alone has an estimated 50,000 permanent residents 

from Western countries, of whom about 5,000 are Americans.29 Because East Africa is relatively 

close to the Middle East and the East African nations do not effectively control passage into and 

out of their jurisdictions, such concentrations of Westerners are targets of convenience. 

Somalia has the weakest law enforcement infrastructure in the region. Since the early 

1990’s, it has had no national executive or administration, no national army, no organized police 

forces in urban areas or in the countryside, and no centralized control of seaports. Somalia’s 

coastline, which extends nearly 1,500 miles along both coasts of the Horn of Africa, includes the 

points of the African continent closest to South Asia and to the southern coast of the Arabian 

peninsula. That coastline likewise is without effective controls. 

Kenya has an increasingly restive Muslim population that accounts for at least 5 percent 

of the country’s total population. Kenyans whose ancestors migrated from South and Southwest 

Asia maintain a network of commercial and family ties with their countries of origin. These ties 

 

27 U. S. Department of State, International Narcotics Control Strategy Report 2003, X-62. 28 “Attentats anti-israJliens: pourquoi le Kenya?” [Anti-Israeli Attacks: Why Kenya?], MarchJs Tropicaux et 

MediterranJens [Paris], no. 2978 (6 December 2002). 29 Emily Wax, “Marines Comb Borders As Worries Rise in Kenya,” Washington Post, 17 May 2003, A16 
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involve trade in hashish and heroin as well as in legitimate goods.30 In recent decades, the 

Swahili-speaking Muslim population along Kenya’s eastern coast has voiced resentment against 

perceived religious discrimination by the central government in Nairobi. That population has 

viewed government authorities with suspicion and businessmen from the central highland as 

unwanted intruders.31 This sense of alienation and the growth of pro-Palestinian sympathies 

provide a receptive environment and a recruiting ground for terrorist groups such as al Qaeda. 

Tanzania also has a sizeable Muslim population, which is situated along the mainland 

coast and on Zanzibar, Pemba, and smaller offshore islands. Tanzania’s Muslims traditionally 

have been occupied primarily with commerce rather than religious zealotry or militancy. 

However, they, like their Kenyan counterparts, have provided a hospitable environment for their 

co-religionists from Middle Eastern and Southwest Asian countries, whatever the newcomers’ 

agendas. 

Kenya’s infrastructure makes the country attractive to businessmen, travelers, and 

international traffickers.32 Although roads and telecommunications have deteriorated in recent 

years, Kenya’s air and sea transport systems are in good condition, especially in comparison with 

neighboring African states. Nairobi’s Jomo Kenyatta International Airport is the major air hub 

for all of eastern Africa, providing air links from other continents to much of Central and 

Southern Africa. International air routes connect to Europe, the Middle East, and South Asia. For 

ocean transport, the port of Mombasa, one of the busiest ports on the east coast of Africa, 

handles a large annual volume of trade, and a transnational network of roads and railroads 

connects Mombasa with Tanzania, Uganda, and Central Africa. West and East Africans and 

South Asians predominate in the trafficking of heroin through Kenya, normally by air.33

Arms Trafficking

In the past decade, trafficking in small arms has increased substantially in Kenya, 

Somalia, Sudan, and Uganda. Livestock is commonly exchanged for firearms in a process that 

 

30 Yaroslav Trofimov, “In Mombasa Streets, Bin Laden Is ‘Hero,’ And U.S. Is Hated,” Wall Street Journal, 

December 2, 2002, A1. 

31 Trofimov. 

32 Information on Kenya’s infrastructure may be found in Economist Intelligence Unit, Kenya: Country Profile 2001

(London, 2001), 25-27, 29-40, and in “Kenya: Communications,” Africa South of the Sahara 2003 (London: 

Europa, 2003), 527-28. 

33 U.S. Department of State, International Narcotics Control Strategy Report 2003, X-25. 
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has become an accepted part of life in East Africa. In Kenya, government demands to surrender 

illegal firearms have gone unheeded. Throughout the Horn of Africa, small arms are 

exacerbating conflicts over natural resources, cattle rustling, and urban crime rates. According to 

a 2002 report, illegal arms in the region “filter beyond armies and police forces to criminal 

organizations, private security forces, vigilante squads, and individual citizens.”34

Unstable political conditions throughout the area minimize government controls and ease 

the contribution of illegal arms to a vicious cycle of violence and disorder. Authorities attribute 

much of the chronic unrest in parts of the region to the easy availability of firearms, which come 

from transnational and domestic traffickers and indigenous rebel organizations such as the 

Sudan-based Lord’s Resistance Army, the Allied Democratic Forces of Uganda, and the Sudan 

People’s Liberation Army (SPLA). An estimated 25 percent of the small arms come from the 

United Kingdom, which is the largest non-African source country. Another 30 percent comes 

from other countries in the European Union.35 The Sudanese government’s policy of arming 

tribal groups against the insurgent SPLA also has contributed to this problem. In the 1990s, the 

Toposa tribe in southern Sudan reportedly received 50,000 AK-47 rifles from the government,36

but they also reportedly received substantial amounts of arms from the SPLA during that 

period.37

Arms traffickers are able to move easily from Sudan, which has no controls on such 

activity, into Uganda. A wide variety of arms are available in Kenya, Uganda, and Somalia.38 A 

2001 study estimated that black marketers sell 11,000 guns in Kenya annually, most of which 

arrive via Uganda, Somalia, Ethiopia, and Sudan. Viktor Bout, the notorious Russian arms dealer 

based in the United Arab Emirates, is known to have sold weapons in Kenya, Sudan, and 

 

34 Lynne Griffiths-Fulton, “Small Arms and Light Weapons in the Horn of Africa,” Ploughshares Monitor, Summer 

2002. <http://www.ploughshares.ca/content/MONITOR/monj02a.htm> 35 International Action Network on Small Arms, “Kalashnikovs for Chickens: Small Arms Boom in East Africa,” 7 

May 2001. <http://www.iansa.org/news/2001/may_01/chicken.htm> 

36 Cathy Majtenyi, “Small Arms: Only a Regional Approach Can Stop the Trade,” The East African [Nairobi], 26 

November 2001. <http://www.nationaudio.com/News/EastAfrican/03122001/Regional/Regional2.htm> 37 United Nations, Office for the Coordination of Humanitarian Affairs, “East Africa: Small Arms Exacerbating 

Regional Insecurity,” Integrated Regional Information Network report, 30 November 2001. 

<http://www.reliefweb.int/w/rwb.nsf/s/23C43ACB12FDC40085256B14005B3462> 

38 International Action Network on Small Arms. 
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Uganda. Tanzania reportedly also is a major arms transit country in the region.39 Middlemen in 

Tanzania supply arms to rebels in Uganda and to both competing factions in Burundi.40

An important center of illegal arms distribution in Kenya is the Dadaab refugee camps 

near Nairobi, from which arms reportedly reach all parts of Kenya as well as Rwanda, Burundi, 

Uganda, and Sudan. Arms from these camps also reach terrorists belonging to the fundamentalist 

al Itihaad group, which the United States accused of having supplied bases in Africa to al-Qaeda 

before the embassy bombings of August 1998.41 Arms traffickers reportedly have a sophisticated 

smuggling system that links Somalia with the camp and with Nairobi. U.S. arms proliferation 

expert Kathi Austin reports that corruption among local Kenyan officials is a major contributing 

factor. Another cause is the central government’s neglect of the border region between Kenya 

and Somalia, where a substantial share of illegal arms shipments transit.42 Kenyan officials have 

identified lax customs controls at designated entry points and the political instability of Somalia, 

southern Sudan, and the Great Lakes region (eastern Congo, Burundi, and Rwanda) as the major 

factors in the large-scale influx of arms.43

Substantial amounts of arms reach competing factions in Somalia through sources in 

neighboring Eritrea and Ethiopia, as well as from Kenya, Yemen, Russia, and Italy. Eritrea and 

Ethiopia flaunt a United Nations arms embargo by buying arms from outside sources for 

themselves and for customers in Somalia. Somalians then sell arms to rebels and criminals in 

Tanzania, Uganda, and Kenya as well as to customers in neighboring Rwanda and Burundi.44

Narcotics Trafficking

The trafficking of cocaine, heroin, mandrax, and marijuana has flourished in coastal East 

Africa. The Kenyan port of Mombasa is a key point of entry for transnational narcotics moving 

from Asian sources to Europe and from India to South Africa. Mandrax from India moves 

 

39 Solomon Muyita, “Uganda Major Point in Arms Trafficking,” New Vision [Kampala], 15 July 2001. 

<http://allafrica.com/stories/200107150067.htm> 

40 Robert E. Sullivan, “Burgeoning Small Arms Trade Has High Profits and Losses,” Earth Times, March 2001. 

<http://www.globalpolicy.org/security/smallarms/2001/03sc.htm> 41 “Arms Trafficking Networks out of Kenya and Somalia, Including Links to Terrorists, Exposed in Fund for Peace 

Investigation,” Fund for Peace news release, 5 December 2002. <http://www.fundforpeace.org> 42 Kevin J. Kelley, “Africa News Service: Daadab an ‘Arms Centre,” Fund for Peace report, 19 November 2000. 

<http://www.fundforpeace.org/media/inthenews/itn10001119.php> 43 “Mombasa Main Conduit for Drug Trafficking,” International Action Network on Small Arms report, 18 June 

2001. <http://www.iansa.org/news/2001/jun_01/mombasa.htm> 

44 Sullivan. 
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overland through Kenya, Tanzania, and Zambia. Since 1993 large amounts of hashish from 

Pakistan and Afghanistan have been entering Kenya through Mombasa and the border point of 

Namanga. Sea routes for heroin begin in Pakistan and Sri Lanka. 45 Traffickers use trucks, oil 

tankers, conventional merchant ships, and airplanes to move narcotics and arms into the region. 

The narcotics trade has brought with it money laundering and other organized crime activities. 

Most drug confiscations occur at Kenya’s airports, although it is known that the majority of 

traffic passes overland or by sea.46As in the case of arms trafficking, lax customs controls and 

corrupt officials have promoted the role of Kenya and its neighbors as a narcotics transit center. 

Kenya also is handicapped by rampant cultivation of domestic marijuana (promoted by corrupt 

officials) and a growing domestic market for narcotics.47

In 2002 Ethiopia, which is located on the route between Asian heroin production 

countries and major West African narcotics trafficking networks, was ranked first among African 

nations in volume of heroin trafficking.48 As a hub for flights from Southeast and Southwest Asia 

into Africa and Europe, Bole Airport in Addis Ababa is a major transit point for this trade. 

Frequent two-day layovers for transcontinental flights offer an opportunity for marketing in 

Addis Ababa. Nigerian and Tanzanian traffickers are especially active in Ethiopia. Government 

interdiction personnel have been poorly trained and equipped, although some improvements 

were made in 2002.49

Like Kenya and Ethiopia, Tanzania is located along natural narcotics trafficking routes 

from east to west and offers traffickers numerous accessible points of entry by sea, land, and air. 

The major points of entry are the airports at Dar es Salaam, Zanzibar, and Kilimanjaro; major 

seaports at Dar es Salaam and Zanzibar; and smaller ports at Tanga and Mtwara. Traffickers also 

use small boats on inland waterways. Heroin from Afghanistan enters Tanzania from Pakistan 

and is smuggled further to Europe and North America by various traffickers, particularly 

Nigerians, utilizing air routes. In recent years, the use of less central access points has increased 

 

45 Observatoire Géopolitique des Drogues, “Kenya,” in 1997 annual report. 

<http://www.ogd.org/rapport/gb/RP11_7_KENYA.htm> 

46 Ken Opala, “The Case for a More Effective Approach,” Daily Nation [Nairobi], 1 August 2002. 

<http://www.mapinc.org/ccnews/v02/n1429/a05.html?347> 

47 Opala. 

48 Opala. 

49 U.S. Department of State, Bureau for International Narcotics and Law Enforcement Affairs, International 

Narcotics Control Strategy Report 2002. <http://www.state.gov/g/inl/rls/nrcrpt/2002/html/17950.htm> 
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as government enforcement measures at airports have improved.50 However, it is widely believed 

that corrupt officials at airports facilitate the transshipment of narcotics through Tanzania.51

Criminal organizations in Tanzanian communities provide in-country support for drug smugglers 

from Afghanistan and Pakistan52

Trafficking in Humans

Jomo Kenyatta International Airport in Nairobi is a central transit point for transnational 

trafficking in human beings. Large numbers of illegal migrants from Somalia, Ethiopia, China, 

India, and Sri Lanka pass through the airport’s weak customs barriers en route to Western 

Europe and the United States. According to a Kenyan immigration officer, the routes involving 

Kenya include more than four countries. Common stops after Nairobi are Mumbai (Bombay) 

and Dubai. An estimated 500 to 750 Somali migrants per month arrive at Wilson Airport, from 

where they travel by road to Nairobi.53 A 2002 investigation by the Nairobi Daily Nation found 

that Kenya’s trafficking syndicate was run by high-ranking and wealthy Kenyans in collusion 

with unscrupulous immigration, intelligence, and police officials at the airport and in the 

Immigration Department. A separate investigation revealed that 3,000 to 4,000 Somalis a year 

were purchasing Kenyan identity and travel documents and one-way air tickets to their 

destination of choice. 54 Immigration personnel lack the skill and equipment to stay ahead of 

sophisticated document counterfeiters. 

The International Organization for Migration has reported large numbers of Ethiopian 

women working as low-paid domestic servants in the Middle East and the Gulf States, after 

having been delivered there by traffickers. In 1999, the number of such cases in Lebanon was 

estimated at between 12,000 to 20,000. Some Ethiopian women also have been trafficked as 

nude dancers in Mongolia.55

 

50 U.S. Department of State, Bureau for International Narcotics and Law Enforcement Affairs, International 

Narcotics Strategy Report 2002.. 51 U. S. Department of State, International Narcotics Control Strategy Report 2003, X-61-X62. 52 “East Africa: Terrorism’s Ties to Drugs,” Strategic Forecast [Austin, Texas], Daily Global Intelligence Report, 

October 5, 2001. < http://www.stratfor.com>; U. S. Department. of State, Narcotics Control Report, 2003, X-61. 53 Stephen Muiruri, “How Illegal Migrants Use Kenya’s Airports,” 13 August 2002. <http://fpmail.friendspartners.org/pipermail/stop-traffic/2002/002266.htm> 

54 Ibid. 

55 International Organization for Migration, “New IOM Figures on the Global Scale of Trafficking: Africa,” 

Trafficking in Migrants, special issue, April 2001. 
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Corruption

Kenya’s level of corruption among public officials has been extremely high for several 

decades. In its June 2001 survey, Transparency International ranked Kenya 84th out of 91 

countries in publicly perceived corruption.56 The corruption problem has come to permeate 

Kenyan society from bottom to top; it ranges from the exactions demanded by police on the 

street to the open embezzlement of funds from state coffers, institutions, and organizations. In 

the 1990s, pervasive corruption came to be regarded simply as a way of life. 

The most visible level of Kenya’s corruption was the administration of President Daniel 

arap Moi (in office 1978–2003), whose officials were widely known as seeking personal profit at 

the country’s expense. More than once in the 1990s, the World Bank and the International 

Monetary Fund suspended development aid because of allegations of misspent funds.57 Such 

large-scale graft and corruption in the public sector have contributed to an environment of 

permissiveness that accommodates and even encourages other forms of criminal behavior, 

including organized crime and terrorism. In early 2003, newly elected President Mwai Kibaki 

characterized Kenya’s pervasive corruption as the root cause of all the country’s problems. 

Kibaki announced an immediate attack on corruption in government and elsewhere.58 However, 

experts remained skeptical that Kenya’s ingrained power relationships would yield to such an 

attack. 

Money Laundering

The hawwalat system, the main method of credit transfer in Somalia, has the potential to 

provide cover for money laundering operations that support crime and terrorism.59 Based on that 

potential, in November 2001 the United States government closed the international offices of alBarakaat, the largest of the Somali hawwalat offices. However, as of early 2002, allegations of 

involvement in funding terrorism had not been confirmed, and the issue remained unresolved. 

The Somali hawwalat is not intrinsically hospitable to outside manipulation because the system’s 

 

56 Economist Intelligence Unit, Kenya: Country Profile 2001 (London: 2001), 15. 57 Economist Intelligence Unit, Kenya: Country Profile 2001, 6. 58 Martin Mutua, “Kibaki Opens Parliament, Vows to Fight Corruption,” The East African Standard [Nairobi], 19 

February 2003. <http://allafrica.com/stories/200302190693.html> 

59 U.S. Department of State, International Narcotics Control Strategy Report 2003, XII-29. 
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norms of reciprocity are based on relationships of trust embedded in clan and familial 

structures.60

Nairobi, which serves as a regional banking and trade center for Eastern, Central, and 

Southern Africa and Kenya, has a large informal economic sector and large amounts of 

unrecorded cash-based international transfers. However, as of 2002 the U.S. Department of State 

had not found that the international financial transactions of Kenyan banks include a significant 

amount of money laundering.61

Terrorist Activity

Like other parts of the continent, East Africa offers terrorists porous borders, interethnic 

and intertribal conflict, lax financial systems, and easily available weapons.62 Sudan is a terrorist 

haven because the government of Omar el-Bashir is run by the National Islamic Front, whose 

goal is to install fundamentalist Islamic government throughout the country. In 1995 an 

assassination attempt was launched from Sudan against Egyptian President Hosni Mubarak.63 In 

1998 al Qaeda terrorists attacked U.S. embassies in Nairobi, Kenya and Dar es-Salaam, 

Tanzania. In 2001 the U.S. Department of State identified al Qaeda, the Egypt-based Muslim 

Brotherhood, and the Palestinian Islamic Jihad and Hamas as terrorist groups having safe havens 

in Sudan.64 Kenya, the scene of major terrorist attacks in 1998 and 2002, seems to harbor 

shadowy terrorist networks, the nature of which remains unclear. Some of the perpetrators of the 

1998 American embassy attacks were foreign Muslims who occupied safe houses in Mombasa, 

using small businesses and relief organizations to subsidize and conceal their activities.65 In 

 

60 For these points as well as a detailed discussion of Somali sharikat hawwalat, see Khalid M Medani, “Financing 

Terrorism or Survival? Informal Finance and State Collapse in Somalia, and the US War on Terrorism,” Middle East 

Research & Information Project (MERIP), 32, no. 223 (Summer 2002), 3-6. 61 Medani. 

62 U.S. Department of State, Patterns of Global Terrorism 2001. 

<http://www.state.gov/s/ct/rls/pgtrpt/2001/html/10236.htm> 63 Council on Foreign Relations and Markle Foundation, “Terrorism: Questions and Answers: Sudan,” 2002. 

http://www.terrorismanswers.com/sponsors/sudan.htm> 64 U.S. Department of State, Patterns of Global Terrorism 2001. 65 “East Africa” Terrorism’s Ties to Drugs”; Benjamin Weiser, “Details Given, and 5 More Charged, in Tanzania 

Bombing,” New York Times, December 17, 1998; Marc Lacey and Benjamin Weiser, “After Attack, Kenya Traces 

Qaeda’s Trail in East Africa, New York Times, 1 December 2002, A1. 
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Tanzania local Muslims helped plan and carry out the 1998 attack on the American embassy in 

Dar es Salaam.66

In Uganda, an Islamist terrorist group, the Allied Democratic Forces (ADF), opposed to 

the Ugandan government, allegedly has sent fighters to train in al Qaeda camps in Sudan and 

Afghanistan. In 2001, the ADF sought financial support and training from Iraq for a terrorist 

campaign in Africa, but apparently little came of these efforts.67

Somalia’s fragmented political situation makes a government-based antiterrorist program 

impossible. However, other factors have discouraged long-term implantation of terrorist groups 

in that country. In general, Somalis (nearly all of whom are Muslim) have not been receptive to 

non-Somali Muslims with political agendas, in part because the pragmatic Somali view of Islam 

and the dominance of the clan structure in society are not compatible with a politicized form of 

religion.68 In addition, Somalia’s decrepit communications and transportation infrastructures 

cannot support an effective transnational organization. 69 

The only terrorist group known to operate in Somalia is al-Ittihad al-Islamiya, (“Islamic 

Unity,” AIAI), which is believed to have links with al Qaeda and was implicated as a transit 

agent in the American embassy bombings of 199870 and the November 2002 attacks against 

Israeli targets in Mombasa.71 In early 2002, experts estimated that as many as 25 militants with 

links to al Qaeda were resident in Somalia.72

Southern Africa 

Southern Africa in a narrow geographical sense encompasses six countries at the southern 

end of the continent—Botswana, Lesotho, Mozambique, Namibia, South Africa, and Swaziland. 

These countries tend to have large geographical areas and long national boundaries and 

coastlines that are difficult or impossible to patrol and leave the interior of the countries 

 

66 Benjamin Weiser, “Details Given and Five More Charged in Tanzania Bombing,” New York Times, 17 December 

1998. 

67 Philip Smucker and Faye Bowers, “Iraq Regime Linked to Terror Group,” Christian Science Monitor, 18 April 

2003, 1, 9. 

68 “Al Qaeda Suspect Handed to FBI,” “World in Brief,” Washington Post, Thursday, March 20, 2003, A26. 69 Economist Intelligence Unit, Eritrea, Somalia, Djibouti: Country Profile 2001, 38, 42. 70 Lacey and Weiser. 

71 Dexter Filkins and Marc Lacey, “Kenya’s Porous Border Lies Open to Arms Smugglers,” New York Times, 4 

December 2002, A18. 

72 Donald G. McNeil, Jr., “A New Scrutiny of Somalia as the Old Anarchy Reigns,” New York Times, 10 February 

2002. 
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vulnerable to penetration by criminal groups. South Africa is the most economically developed 

of the region’s countries, followed by Botswana. The remainder of the region is poor and 

underdeveloped, with meager resources available to develop effective programs relating to 

education, health, or law enforcement. As of the late 1990s, some countries were in a process of 

political and economic transition, rendering state structure fragile and ineffective. In Angola and 

the Democratic Republic of Congo, on-going civil wars promoted instability and trafficking in 

arms, narcotics, gold, diamonds, and other natural sources throughout the region. Bribery and 

corruption involving government officials, law enforcement personnel, and border guards were 

also major problems. 

By the 1980s, indigenous criminal networks existed in most if not all of the countries of 

Southern Africa. Such groups often were linked with each other in cross-border networks that 

trafficked in stolen vehicles, narcotics, and arms among other items. In the early 1990s, 

international criminal organizations began to converge upon the region, where most counties 

were extremely vulnerable to illicit activities. In the 1990s, both Mozambique and South Africa 

emerged from drastic political transitions that left them vulnerable to a variety of transnational 

groups. South Africa, which possesses by far the richest natural resources and the most 

developed infrastructure in the region, was the favorite target of such groups, both terrorist and 

criminal, from a wide variety of countries. Criminal activities based in South Africa have spread 

across the borders into neighboring countries. Mozambique has become involved mainly as a 

transit country whose banking system promotes the money laundering of transnational 

traffickers. 

Mozambique

After Mozambique emerged from a prolonged period of civil war in 1992, the movement 

of people and goods increased. With that increased movement has come a new role for 

Mozambique as a major transit country for narcotics. There are two main routes: heroin moves 

from South Asia via Dubai and Tanzania and is sent on to Europe, and cocaine arrives from 

Colombia and Brazil and goes on to Europe and East Asia. Mandrax (methaqualone), imported 

from South Asia and manufactured domestically, is destined for South Africa. Hashish is 

smuggled from Southeast Asia in huge quantities, averaging an estimated 200 tons per year in 
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the mid-1990s. In May 2001, a single shipment of six tons of hashish was seized. It is processed 

and re-exported to Europe and North America.73

The drug trade has grown in Mozambique as major drug syndicates have sought new 

routes that international agencies do not monitor as effectively as more traditional routes through 

neighboring countries. Mozambique’s ports are entry points for hinterland countries of Southern 

Africa, and the 1,550-mile coastline is impossible for resource-poor Mozambican maritime 

authorities to patrol. The country’s extreme poverty, low salaries, and climate of corruption 

foster bribery and corruption of police, border guards, and government officials. One provincial 

governor allegedly received $500,000 for each large shipment of cocaine that passed through his 

territory. International experts claim that the Mozambican police are almost totally corrupted, 

and that Maputo airport is easily available to narcotics couriers.74

Other established forms of transnational crime in Mozambique are vehicle theft and gun 

running. Since the late 1990s, counterfeiting, bank fraud, money laundering, and trade in ivory 

and precious stones have made their appearance.75 Like South Africa, Mozambique has a 

network of willing locals who facilitate these activities, often in conjunction with cross-border 

criminal networks in South Africa. 

The country’s financial institutions may be heavily involved in money laundering. One 

investigative reporter notes that, as of mid-2001, Mozambique has far more banks and foreign 

exchange bureaus than can possibly be justified by the size of the legal economy and the need to 

exchange sizable foreign aid funds. Therefore, authorities suspect that these institutions are 

involved the laundering of proceeds from the narcotics industry, although officials of the Bank of 

Mozambique deny such charges. Other outlets for converting illegal profits in Mozambique 

include conspicuous consumption, investment in real estate, and the purchase of stocks and 

bonds, which can be executed with few questions asked. 76

 

73 Antonio Paulo Namburete, “Organised Crime in Mozambique and Its Impact Within the Regional and 

International Context,” in M. Hough and A. Du Plessis, eds., The Grim Reaper: Organised Crime in the 1990s—

Implications for South and Southern Africa, Institute for Strategic Studies, Monograph no. 36, 1999), 28; U. S. 

Department of State, Bureau for Narcotics and Law Enforcement Affairs, International Narcotics Control Strategy 

Report 2001. <http://www.state.gov/g/inl/rls/nrcrpt/2001/html/17950.htm> 

74 Joseph Hanlon, “Metical Special Investigation: Drugs Now Biggest Business,” Metical [London], 28 June 2001. 

<mozambique-news@geo2.poptel.org.uk> 

75 Namburete, 27, 29-31. 

76 Hanlon; Namburete, 32-33. 
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Mozambican authorities have attempted to restrict illicit activities. The country is a 

signatory to several international conventions aimed at narcotics control, has enacted legislation 

of its own, and has conducted operations against drug lords and the trade in stolen vehicles.77

Nonetheless, even when legislation is on the books, officials lack the financial resources and 

often, it seems, the will to enforce it. The country is too poor to make crime interdiction a 

priority, and corruption reaches into the highest echelons of law enforcement and government. 

For instance, a former director of investigative operations of the Criminal Investigative Police 

was himself recently detained for allegedly distributing hashish and heroin (he was released 

without charges being filed), and a high-profile trial that concluded on January 31, 2003, 

involving charges of illegal imports, currency dealings, and murder, implicated even President 

Joaquim Chissano’s son.78

South Africa

Several factors create a favorable environment for international organized crime and 

terrorism in South Africa. In terms of geography, it is situated midway on communication routes 

that connect South America, South and Southeast Asia, the Middle East, and Europe. South 

Africa has a long coastline that requires a constant effort to patrol. The well-equipped deep-water 

ports at Cape Town, Durban, and Port Elizabeth invite a high rate of seagoing commerce that 

complicates effective import-export control. Land borders are also long and often unpatrolled. 

They are crossed daily by criminals trafficking in many forms of contraband, including but not 

limited to narcotics, stolen cars, illegal firearms, diamonds, and precious metals. An indigenous 

and radicalized Muslim community provides protection and support for Islamic fundamentalist 

groups. 

Until the late 1980s, South Africa had remained largely isolated from the international 

developments that affected organized crime, both domestic and international. The authoritarian 

and security-conscious environment fostered by the apartheid regime made aggressive activity in 

South Africa quite risky for international crime syndicates. However, as the state’s law 

enforcement agencies focused their attention on political opponents, indigenous criminal groups 

 

77 Namburete, 35; U.S. Department of State, International Narcotics Control Strategy Report 2001. 78 U.S. Department of State, International Narcotics Control Strategy Report 2001; “Mozambique: A Flood of 

Mud,” Africa Confidential [London], 43, no. 25 (20 December 2002): 2-3; “Carlos Verdicts Taint Chissano’s Son,” 

1 February 2003. <http://allAfrica.com> 
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increased their activities significantly during the 1980s. Despite relatively strict border controls, 

cross-border organized crime between South Africa and its neighboring states also expanded, 

forming smuggling networks that crisscrossed the southern cone of Africa.79

The political changes that occurred in 1994 when apartheid was replaced by 

constitutional democracy created opportunities for both indigenous and international organized 

criminal groups to exploit the new low-risk environment that South Africa now provided. The 

country entered an era of political transition during which state structures, including security 

services, were undergoing substantive reform that weakened them. Border controls relaxed at the 

same time that international trade and tourism expanded. South Africa gradually became more 

accessible to the international community, including the criminal underworld. By the late 1990s, 

many of the uncertainties caused by the transition had subsided, but organized crime had gained 

a firm foothold in South Africa. Belatedly recognizing the danger that both internal and 

international organized crime posed, the new democratic government began taking steps to 

counter both.80

South Africa has the most developed transportation, communications, and banking 

infrastructure in sub-Saharan Africa. This infrastructure is an essential attraction for criminals 

both inside and outside the country. Air connections across the Atlantic to South American drug 

sources are excellent, telecommunications connections across the world are instantaneous and 

reliable, and an efficient banking system, well integrated into the global economy, offers 

opportunities for money laundering. South Africa is also rich in commodities, such as gold, 

diamonds, and platinum, that can be used to fund criminal or terrorist activities and to transfer 

wealth from one place to another. Since the mid-1990s, the country has become a relatively 

stable and open society with broad civil liberties that permit easy movement of people and 

money, both legal and illegal.81 The situation in South Africa, particularly as concerns terrorism, 

was summarized by Gideon Jones, former head of the Criminal Intelligence Unit of SAPS: “It’s 

a perfect place to cool off, regroup, and plan your finances and operations. The communications 

 

79 Peter Gastrow, “Main Trends in the Development of South Africa’s Organised Crime,” African Security Review, 

3, no. 6 (1999), 1. 

80 Gastrow, “Main Trends,” 1; Mark Shaw and Peter Gastrow, “Crime and Its Impact in Post-Apartheid South 

Africa,” Daedalus, 130, no. 1 (Winter 2001): 250-51. 

81 South Africa’s attractions for international crime and terrorism are mentioned in a number of sources: Gastrow, 

“Main Trends,” 7; Williams and Brooks; U.S. State Department, International Narcotics Control Strategy Report 

2001, “Africa: South Africa” (Washington, 2002), <http://www.state.gov> 
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and infrastructure are excellent, there is a radical Muslim community, and our law enforcement 

is overstretched.”82

Two additional factors contribute to South Africa’s profile of criminal attraction. A large 

and well-organized criminal network or syndicate exists within the country, composed of a 

number of notorious street-gangs. The street gangs control local narcotics distribution and have 

established a mutually advantageous arrangement to divide up the domestic narcotics market 

with their international suppliers. The gangs, already engaged in internal and cross-border 

vehicle theft, gun-running, and trade in cannabis and mandrax, presented dealers from outside 

South Africa with contacts and ready-made networks that offered the opportunity to develop a 

more sophisticated narcotics industry. In return, the gangs have learned new techniques of the 

trade from their international mentors. Gang membership and criminality is promoted by high 

rates of poverty and unemployment, particularly among the black segment of the population.83

According to the South African Police Service (SAPS), international criminal 

organizations involving, among others, Nigerians, Russians, Chinese, Moroccans, and Italians, 

have been operating in South Africa since at least the early 1990s.84 Nigerian groups were 

perhaps the first to arrive, establishing themselves in Johannesburg during the late 1980s. By the 

late 1990s, Nigerian crime syndicates dominated the illicit trade in cocaine in South Africa, 

which had become a transit country for narcotics shipments into Europe and the Middle East. 

The Nigerians also had begun to trade in locally produced cannabis and some heroin, which also 

was shipped to Europe, and to engage in kidnapping and ransoming schemes.85

By the mid-1990s, SAPS became aware that Russian organized criminals were present 

and active in South Africa. While the scope of their activities was difficult to discern, they 

appeared to be involved in arms smuggling, fraud, car theft, narcotics trafficking, and possibly 

trafficking in uranium. Russian criminals were suspected of conducting their activities, including 

money laundering, behind the cover of legitimate business operations.86

 Chinese criminal groups, linked to Chinese triad organizations in Hong Kong and 

Taiwan, have been active at least since the early 1990s. Operating largely from Johannesburg 

 

82 Block, “In South Africa,” A7. 

83 Kinnes, “From Urban Street Gangs--National and Local Trends,” 1-2; Shaw and Gastrow, “Crime and Its 

Impact,” 250-53; 

84 Gastrow, “Main Trends,” 3. 

85 Gastrow, “Main Trends,” 4. 

86 Gastrow, “Main Trends,” 5-6. 
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and Pretoria, they deal in the illicit trade in rhino horn and ivory, money laundering, contraband, 

and the trafficking of Chinese migrants into South Africa. Chinese gangs also dominate the 

illegal harvesting and trade in abalone, an edible mollusk with a mother-of-pearl shell that is in 

high demand in the Far East. This is a low-risk activity because South African authorities give 

little attention to the depletion of marine resources. Chinese narcotics traffickers specialize in 

mandrax, which is the overwhelming choice of South African narcotics users. Mandrax is 

manufactured in South Africa and neighboring Mozambique, but substantial quantities of 

mandrax tablets are imported from Asian sources by Chinese, Indians, and Pakistanis in South 

Africa.87

During the 1990s, senior Italian mafia operatives are known to have penetrated middle 

and upper government echelons. The reputed mafia “boss” Vito Palazzolo, who was arrested in 

1998, gained a reputation for corrupting government officials. Palazzolo allegedly suborned a 

cabinet minister, a security force general, a top immigration official, and many policemen.88

Indian and Pakistani groups in South Africa are involved mainly in narcotics, illegal migrants, 

and smuggling of contraband. Portuguese crime groups have been involved in truck-hijackings 

and the smuggling of illicitly obtained diamonds and gold. Moroccans in the Cape Town engage 

in extortion rackets and the narcotics trade.89

During the 1990s, Muslim-based groups inclined toward vigilantism, and urban terrorism 

appeared in the Muslim communities of South Africa, whose total population is estimated at 

600,000. Among these are Muslims Against Global Oppression (MAGO), Muslims Against 

Illegitimate Leaders (MAIL), and People Against Gangsterism and Drugs (PAGAD).90 The last 

group, based in the Western Cape, is perhaps the most notorious and the best known outside 

South Africa. Dedicated originally to the elimination of drug dealers and street gangs in former 

colored townships, PAGAD has evolved into a full-fledged terrorist organization with alleged 

support and training from Iran, Libya, and Sudan. Its militants have resorted to violence, 

including bombings, directed against police, businessmen, religious leaders, and foreign 

interests, particularly those of the United States. For example, PAGAD operatives bombed the 

 

87 Gastrow, “Main Trends,” 5-6. 

88 Gastrow, “Main Trends,” 6-7. 

89 Gaatrow, “Main Trends,” 7. 

90 Irvin Kinnes, “From Urban Street Gangs to Criminal Empires: The Changing Face of Gangs in the Western Cape, 

National and Local Trends,” Institute for Strategic Studies, Monograph no. 48, 2000), 2. 
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Planet Hollywood restaurant in Cape Town in July 1998, causing two deaths and injuring 

dozens. PAGAD is known for militantly anti-American and anti-Israeli views. 

Several international Muslim terrorist organizations also are present in South Africa. 

According to South African intelligence sources, the militant Palestinian group Hamas has been 

active since at least 1992, raising funds and enlisting recruits for military training. The Lebanesebased Hizballah group allegedly maintains a presence in South Africa as well. After establishing 

a foothold in 1997, al Qaeda seems to view South Africa as a source of funds as well as a place 

of refuge for fugitive militants. These groups are aided by local radicals in the indigenous 

Muslim population.91 

Mandrax, imported from production sources in India, Kenya, and Pakistan, is rated as 

South Africa’s most serious narcotics problem. The problem is most serious in Cape Town, 

where competition among thousands of drug dealers and the high cost of supporting addicts’ 

habits are responsible for most of the serious crime that occurs. Dubai and Mumbai (Bombay) 

are the main transit points from which traffickers move mandrax into South Africa.92

The final factor is quite peculiar to South Africa: effect of the apartheid legacy on law 

enforcement agencies. Under apartheid, the police and legal systems were intended to control 

and to suppress dissent among the black population, not to investigate crime per se. Because the 

police enjoyed little legitimacy with the majority of the population, the law and its enforcement 

was not the object of public respect. Under these circumstances, a “culture of violence” 

characterized South African society. For its part, the SAPS has had to undergo a reorientation of 

mission and attitudes since 1994. The SAPS has expanded and reorganized to emphasize 

enforcement of the new democratic order. As entire segments of the population remain 

suspicious of the police and the courts, law enforcement officials are now learning to deal with 

criminal and terrorist groups of far greater sophistication than those of the apartheid era.93 In this 

atmosphere of mistrust and transition, organized criminals and terrorist elements have flourished 

in recent years. 

 

91Robert Block, “In South Africa, Mounting Evidence of al Qaeda Links,” Wall Street Journal, Tuesday, December 

10, 2002, A1, A7. 

92 “Mandrax,” Electronic Doctor [South Africa]. <http://www.edoc.co.za/drughelp/mandrax> 93 Peter Gastrow and Mark Shaw, “In Search of Safety: Police Transformation and Public Responses in South 

Africa,” Daedalus, 130, no. 1 (Winter 2001): 262-72; George Govender, “Prevention and Combating of Organised 

Crime in South Africa,” in M. Hough and A. Du Plessis, eds., “The Grim Reaper: Organised Crime in the 1990s—

Implications for South and Southern Africa,” Institute for Strategic Studies Publication no. 36 (1999), 52-59. 
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Western Africa 

Introduction

Like other regions of the continent, West Africa suffers from chronic armed conflict, 

extremely high rates of poverty, porous border security, and governmental inefficiency and 

corruption. These conditions have permitted the growth of numerous armed insurgent groups, an 

extensive narcotics trafficking network centered in Nigeria; trafficking in women and children 

originating in many countries of the region; misallocation of natural resources such as timber, 

precious metals, and diamonds; and an enormous arms trafficking industry that is supplied from 

Eastern Europe and the former Soviet Union and regionally centered in Liberia. A strong driver 

of criminal conduct in West Africa is the region’s rich supply of natural resources, which has 

attracted unscrupulous entrepreneurs from Europe and financed criminal and terrorist activity. 

Reportedly, al Qaeda has established at least tenuous links in parts of the region. 

Narcotics Trafficking

In recent years, Nigerian and Ghanaian trafficking groups have established strong links 

with heroin sources on the Indian subcontinent, in the Golden Triangle, and in the Golden 

Crescent. An extensive transnational network of narcotics traffickers has extended from Nigeria, 

which has become the West African center for that type of crime and for money laundering. That 

network extends into neighboring countries and as far as Kyrgyzstan and South America. 

Already in 1999, authorities estimated that Nigerian groups were active in 60 countries, and ties 

have been established with criminal groups in the United States, Europe, South America, Asia, 

and South Africa.94 Lomé, the capital of nearby Togo, has been described as “a spoke in the 

Nigerian hub of narcotics trafficking and money laundering.”95 In recent years, Nigerian 

narcotics groups also have migrated into neighboring Benin, Chad, and Niger.96 A significant 

proportion of heroin arriving in the United States from Asia has passed through Nigeria, and 

Nigerian agents in South America move cocaine to points in Europe, North America, and South 

 

94 U.S. Department of State, International Narcotics Control Strategy Report 2003, X-43. 95 U.S. Department of State, International Narcotics Control Strategy Report 2003, X-43. 96 “New Ambitions in the Fight Against Drugs,” Geopolitical Drug Newsletter [Paris], October 2001. 

<http://www.geodrugs.net/mini-lettres/AEGD6GB.pdf> 
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Africa. Nigerian narcotics traffickers also are involved in counterfeiting documents, trafficking 

in migrants, and financial fraud.97

Drug enforcement in Nigeria has been hindered by chronic corruption (Nigeria 

consistently is rated one of the most corrupt nations in the world) and by under-funding of law 

enforcement agencies. Corruption is compounded by the low salaries received by civil servants 

and by a poorly trained and motivated police force. The populace of Nigeria distrusts the police 

force, making citizens vulnerable to manipulation by criminals in urban centers such as Lagos, 

Enugu, Port Harcourt, Jos, Kano, and Kaduna.98

National drug interdiction agencies have not effectively shut down large-scale dealers, 

who benefited from declines in the national infrastructure to establish strong footholds during a 

long series of military dictatorships ending in 1999. Interagency cooperation for drug interdiction 

has not been effective, and the corrupt court system has not backed law enforcement efforts. The 

Nigerian Customs Service has resisted interdiction measures of the National Drug Law 

Enforcement Agency. In 2002 the Obasanjo government reportedly made progress in limiting the 

money laundering activity that stems directly from narcotics trafficking and related crime.99

The volume of narcotics transiting through Ghana has increased sharply in recent years, 

mainly under the direction of Nigerian traffickers. Cocaine moves via Ghana from South 

America to Europe, and heroin moves via Ghana from Southeast and Southwest Asia to Europe. 

Narcotics destined for South Africa and North America also move through Ghana. Major factors 

in this trend are Ghana’s proximity to Nigeria and its increasing role as an international 

transportation hub. Accra’s Kotoka International Airport is a major transit point, as are the ports 

of Tema and Sekondi and the border towns of Elubo, Aflao, and Sampa. Customs officials have 

complained that the national judicial system does not back their interdiction efforts with timely 

prosecution.100

Human Trafficking

Because the poverty of the region has created a widespread state of desperation, 

trafficking in women from West Africa has become a major transnational crime. The majority of 

 

97 U.S. Department of State, International Narcotics Control Strategy Report 2003, X-64. 98 U.S. Department of State, International Narcotics Control Strategy Report 2003, X-43. 99 U.S. Department of State, International Narcotics Control Strategy Report 2003, X-43-45. 100 U.S. Department of State, International Narcotics Control Strategy Report 2003, X-14. 
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the victims are poor women who are promised money-earning jobs in the country of destination 

but find themselves instead in the sex trade or working as virtual slaves. The primary European 

end points are Belgium, Italy, and the Netherlands; other women are moved to Lebanon, Libya, 

and the United States as well as to Nigeria and other countries in West Africa.101 The connection 

between Nigeria and Italy, one of the most frequent destinations, began in the 1980s, when 

Nigerian women began traveling to Italy as agricultural laborers.102 Mali also sends significant 

numbers of women as domestic servants to Kuwait and Saudi Arabia.103

Large numbers of West African children also are trafficked as agricultural and domestic 

workers and for the sex trade. Mali and Benin are primary sources of this trade, in which poverty 

is a major factor. In recent years, the cacao plantations of Ivory Coast have come under 

investigation for allegedly using thousands of child laborers from Mali and Burkina Faso. 

Cultural and legal factors also play a part, as parents often send their children to be raised by 

others who then sell them to traffickers. Ghana has no laws against child trafficking or child 

labor,104 and its laws protecting women have been described as “woefully outdated” in dealing 

with the relatively new transnational forms of trafficking.105 The International Labor 

Organization also has identified significant trafficking in humans in Burkina Faso and the Ivory 

Coast.106

The U.S. Department of State has identified Senegal as both a source and a transit point 

for trafficking in women. According to the 2002 report, Senegal’s weak border controls and 

official corruption have made the capital city, Dakar, a transit point for Nigerian traffickers 

moving women from Nigeria to the sex trade in European cities. Senegal’s light legal penalties 

for such crimes are a contributing factor.107

 

101 International Organization for Migration. 102 The Advocacy Project, “Girls for Sale: Building a Coalition to Fight Trafficking in Nigeria.” 

<http://advocacynet.autoupdate.com/cpage_view/nigtraffick_girlsforsale_6_25.htm> 

103 International Organization for Migration. 104 “Trafficked Children Registered,” report of AllAfrica.com, 4 February 2003. 

<http://allafrica.com/stories/200302040508.htm> 

105 “ECOWAS Experts Discuss Action Plan Against Human Trafficking,” News in Ghana [Accra], 2001. 

<http://www.newsinghana.com/politics/archive/ECOWAS-experts-discuss-action.htm> 106 International Labour Organization, “ILO Reports on Child Trafficking in West and Central Africa,” 15 June 

2001. <http://www.ilo.org/public/english/bureau/inf/pr/2001/21.htm> 

107 U.S. Department of State, Trafficking in People Report 2001. <http://www.state.gov/g/tip/rls 
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Arms Trafficking

Because of persistent insurgencies and weak governments, the region has absorbed large 

amounts of illegal arms in the past two decades. Small arms (conventionally, those that can be 

carried by an individual or on a small vehicle) are attractive in such a region because they are 

durable and the newest models offer high firepower at a relatively low price. In 2002, Nigeria’s 

defense minister warned that the proliferation and illegal trafficking of small arms into that 

country was intensifying criminal activity in the country and raising the danger of violent clashes 

among Nigeria’s several ethnic groups.108 Liberia has gained a reputation as a center of 

government corruption and high-volume trafficking in arms, diamonds, and timber. Since the 

early 1990s, European-based large-scale arms dealers have taken advantage of unstable regional 

conditions to trade arms for diamonds with a variety of rebel groups in West Africa and 

elsewhere on the continent. Liberia has been the arbiter of many such deals, opportunities for 

which are perpetuated by the political fragility of post-conflict societies. The World Bank’s 

African economics expert Paul Collier has called this fragility the “legacy of induced polarizing 

grievance.”109 At the point of origin, dealers provide falsified end-user documents that usually 

declare Guinea as the end point for arms shipments. Those documents seldom have been verified 

by authorities in Central and Eastern Europe.110 

Some of the dealers also have been identified as providers of arms to terrorist groups 

such as al Qaeda. Beginning in 2002, reports indicated the presence in Mali, Mauritania, and 

Niger of Mokhtar Belmokhtar, an Algerian arms dealer with connections to the extremist Islamic 

group Call to Combat, which has received funding from al Qaeda. According to a Voice of 

America report, al Qaeda could take advantage of the sparse population and limited law 

enforcement capability of those countries to establish a foothold in the interior of Western 

Africa.111 Until at least 2001, Russian arms trafficker Victor Bout sold large amounts of small 

 

108 “Nigeria: Defence Minister Denounces Increased Number of Small Arms in Country,” BBC report, 14 January 

2002. <http://www.clw.org/atop/newswire/nw011402.htm> 

109 Paul Collier, “Economic Causes of Civil Conflict and Their Implications for Policy.” 

http://www.worldbank.org/research/conflict/papers/civilconflict.htm, quoted in Lansana Gberie, “War and Peace in 

Sierra Leone: Diamonds, Corruption and the Lebanese Connection,” Diamonds and Human Security Project, 

Occasional Paper no. 6, November 2002, 1. 110 Joost Hiltermann, “Liberia: New Arms Embargo Failing: Weak Export Controls Largely to Blame,” Human 

Rights Watch report, 5 November 2001. <http://www.hrw.org/press/2001/11/liberia1105.htm> 111 “Washington Possibly Examining Militancy Threat in West Africa,” Stratfor report, 14 November 2002. 

<http://www.stratfor.com> 
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arms, helicopters, missiles, and armored vehicles to the insurgent Revolutionary United Front 

(RUF) in Sierra Leone through the government of Liberia.112 Many of those arms presumably 

still are in circulation in the region. 

The Liberia Problem

The government of Liberian president Charles Taylor, who abdicated and went into exile 

in August 2003, was linked with several forms of transnational crime including arms trafficking. 

Although an international peacekeeping force entered Liberia as he was abdicating, regional 

analysts agreed that Taylor’s extensive regional contacts could enable him to preserve the 

extensive network of transnational criminal activities that he had established in West Africa. 

Because Taylor’s departure left a divided country lacking any central authority, Liberia still 

offers an attractive base for such activities. 

A 2003 report linked Liberia’s European-owned timber industry with the trafficking of 

arms to rebel groups in nearby Ivory Coast and Sierra Leone. According to that report, arms 

shipments arrive in Liberia from Eastern Europe every two or three weeks, via Nigeria and 

Libya, then are dispersed to client groups. Arms arrive at the two port cities that are controlled 

by the timber industry, demonstrating the interdependence of government-supported arms 

trafficking with timber companies. Under Taylor, the Liberian government also has directly 

controlled insurgent groups that have caused full-scale civil war in Ivory Coast in the past year 

and continue to threaten stability in Sierra Leone.113 

Taylor is known to have very large bank accounts in Switzerland and elsewhere that were 

fed by embezzlement of government funds.114 The government’s timber policy ignored 

international logging restrictions by permitting timber companies to clear-cut large expanses of 

protected West African rain forest. Taylor’s regime also was identified as the intermediary in 

cut-rate sales of diamonds from insurgents in Sierra Leone to al Qaeda operatives, who raised 

 

112 Steve Park, “’Victor B’ Watched for Taliban Ties,” Washington Times, 22 July 2002. 

<http://www.washtimes.com/world/20020722-330000642.htm> 

113 “West African Arms Trafficking and Mercenary Activities Supported by the Liberian Government and Logging 

Companies,” Global Witness press release, 13 March 2003. 

<http://www.globalwitness.org/text/press_releases/display2.php?id=186> 114 “West African Arms Trafficking and Mercenary Activities Supported by the Liberian Government and Logging 

Companies.” 
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money by selling the diamonds at higher prices in Europe.115 In December 2002, the Washington 

Post reported that the Taylor government had accepted US$1 million to provide refuge for al 

Qaeda members after the September 11 attacks, and that while in Liberia those individuals 

bought missiles and other arms.116 In June 2003, a United Nations-backed war crimes court 

found Taylor guilty of crimes against humanity because various trafficking activities of the 

president prolonged and promoted the civil war in Sierra Leone.117 

FORMER SOVIET UNION AND EASTERN EUROPE 

Introduction 

Several countries of the former Soviet Union have been bases for or victims of terrorist 

activity within the past three years. Those countries include Georgia, Kyrgyzstan, the Russian 

Federation, Tajikistan, and Uzbekistan. In addition, ethnic Albanian insurgent groups have been 

active in the vicinity of Kosovo, including parts of Macedonia and Serbia. The states of the 

former Soviet Union and Central and Eastern Europe also demonstrate characteristics that make 

them inviting targets for transnational criminal groups seeking favorable territory from which to 

operate. A wide range of criminal activities in those countries includes trafficking in arms, drugs, 

and persons; money laundering; and bribery. Particularly vulnerable to criminal activity are the 

states that emerged from the former Socialist Federal Republic of Yugoslavia (with the exception 

of Slovenia) and the states that emerged from the former Soviet Union (increasingly, with the 

exception of the Baltic states). 

The prospect of closer contact with Western institutions such as the European Union has 

motivated the Baltic states and most of the former Warsaw Pact countries of Eastern and Central 

Europe to substantially strengthen their laws and border enforcement. The same stimulus has 

acted less forcefully in the new nations of Central Asia and the Caucasus. However, recent 

reforms in those countries have not necessarily eliminated them from the list of “nations 

 

115 Michael Barone, “Dirty Diamonds,” U.S. News and World Report online report, 12 November 2001. 

<http://www.usnews.com/usnews/opinion/baroneweb/mb_011112.htm> 

116 Douglas Farah, “Report Says Africans Harbored al-Qaeda: Terror Assets Hidden in Gem-Buying Spree,” 

Washington Post, 29 December 2002, A1. 117 Douglas Farah, “Taylor Charged with War Crimes During Long Conflict in Sierra Leone,” Washington Post, 5 

June 2003, A22. 
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hospitable”; in all cases, well-established patterns and routes can be expected to remain until 

legislation is backed by substantive action. 

In the former Soviet states, progress toward the rule of law has been hindered by the 

sudden disappearance of national authority (the Soviet state) in areas having no individual 

tradition of state authority or civil society but having very well developed traditions of 

underground criminal activity. As is the case with the former Yugoslav republics, some of the 

former Soviet states have fared better than others in making themselves inhospitable venues for 

criminal activity. In general, in this respect the Baltic states have done best, Moldova and 

Tajikistan worst. 

In their progress toward the rule of law, the former Warsaw Pact nations of Eastern and 

Central Europe have geographical disadvantages (being located on the trafficking routes between 

East and West and adjacent to states with severe criminal problems), economic disadvantages 

(facing the upheaval of complete economic transition), and geopolitical advantages (proximity to 

the well-developed West European community and prospective membership in West European 

organizations). Together, these factors have yielded substantial but mixed progress in warding 

off criminal and terrorist activities. Bulgaria, Hungary, and Romania have faced difficulties 

associated with their location along main east-west trafficking routes; the Czech Republic, 

Poland, and Slovakia have less diversified forms of criminal activity. Because of its weak 

political and law-enforcement systems, Albania has presented a uniquely hospitable gateway to 

the West for various criminal groups. 

Albania 

Since 1992, ethnic Albanian organized crime groups have profited greatly from 

instability and war in the Balkans to become the fastest growing ethnic criminal presence in 

Europe. With operations reaching as far as Australia and the United States, Albanian groups are 

the direct distributors of an estimated 40 percent of heroin in West European markets and may 

have an indirect role in as much more. Experts disagree about the degree to which Albanian 

groups have abandoned the traditional clan-based structure of their predecessors as they recruit 

outside their communities and cooperate with a variety of foreign criminal groups. Some 
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restructuring undoubtedly has occurred, and the transnational cooperation of Albanian groups 

has increased dramatically. 

Although Albanian government and law enforcement are not as unstable as they were in 

the 1990s, they are not yet strong enough to combat clan-based banditry, which has a long 

tradition in Albania, or the new forms of organized crime that have flourished in the past decade. 

Observes transnational crime expert Mark Galeotti: “In much of the country, local clans and 

allied criminal organizations are more powerful than the state. Cities such as Vlorë and 

Gjirokaster and regions including Gramsh, Elbasan, and Dirba remain virtual bandit 

homelands.”118 In many cases, the frontier between activities of Albanian political and criminal 

organizations is very unclear because both forms of activity retain roots in Albania’s clan system 

and at least part of the corruption that permeated the political system in the 1980s and 1990s has 

remained.119 The police are poorly equipped and poorly paid, and specialized units such as the 

financial crimes division receive no training. 

The influence of government corruption has been obvious in several instances. In March 

2002, two officials with major responsibilities in the Albanian government’s recent anti-narcotics 

campaign were found to be themselves participating in a heroin trafficking operation.120 In mid2002, a leak compromised a major trafficking interdiction operation of the Albanian army and 

police. That operation, in cooperation with Italian, Greek, and Yugoslav authorities, was 

expected to confiscate as many as 30 boats crossing the Adriatic from the port of Vlorë, but most 

of the smugglers escaped.121 Authorities often link police personnel with various types of 

smuggling. Aside from corruption, special police interdiction units are hampered by poor 

equipment. The judiciary’s policy of quickly releasing narcotics suspects does not support police 

apprehension efforts, and traffickers are adept at changing their routes to avoid detection.122

Lawless conditions in Albania are promoted by the domination of criminal organizations 

in neighboring Kosovo, where the population is about 90 percent Albanian, and in the adjoining 

region of northwestern Macedonia, which also has an Albanian majority. In Albania and the two 

 

118 Mark Galeotti, “Albanian Gangs Gain Foothold in European Crime Underworld,” Jane’s Intelligence Review, 1 

November 2001. 

119 Galeotti. 120 Zylyftar Bregu, Albania: Authorities Rocked by Drugs Scandal,” Institute for War and Peace Reporting report, 

22 March 2002. <http://www.iwpr.net> 

121 “Smuggling Continues Despite Multinational Efforts,” RFE/RL Crime and Corruption Watch, 2, no. 30 (30 

August 2002). <http://www.rferl.org/corruptionwatch/2002> 

122 Bregu. 
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Albanian regions nearby (the respective borders of which are not meaningful for law 

enforcement), extreme economic disorder, the substantial displacement of Albanian populations 

by war, and nationalist aspirations combine to promote the recruitment of young people for the 

illicit activities of organized crime groups. In this process, for example, Albanians in all three 

jurisdictions have played an increasingly vital role in transporting heroin across the Balkan 

region for the Turkish and Kurdish organizations that dominate the wholesale heroin trade.123

The so-called Italian Route, one variant of the Balkan Route, moves heroin from Kosovar bases 

in Peč and Prizren across the border into the lawless Tropoje region of Albania, controlled by the 

Haklaj clan. Shipments then move to the ports of Vlorë, Sarande, and Durrës.124

In the 1990s, Albanians began as couriers for established Italian smuggling organizations, 

offering familiarity with routes that avoided border patrols during the Yugoslav conflicts of 

1992-95. From that beginning, the Albanians gradually acquired their own heroin processing and 

distribution systems and diversified their smuggling operations to include illegal migrants, stolen 

cars, cigarettes, and other commodities. Reportedly, the trade in counterfeit cigarettes is so 

profitable that Albanian and Macedonian groups have fought for market control.125

As they diversified their products, Albanian groups also were able to reach cooperative 

agreements with several Italian mafia organizations, which had resisted the incursion of foreign 

elements into their territory. Eventually the Albanians shared operations with major Italian mafia 

groups in Calabria, Apulia, and Naples. The ongoing migration of Albanians into Italy has 

formed a bridgehead of increasingly independent Albanian criminal groups that have penetrated 

northern Italy, where no single Italian group has been dominant. The activities of new Albanian 

groups have been especially profitable in the wealthy cities of Milan and Florence126 (see 

Western Europe). 

From Italy, Albanian criminal groups have spread to other parts of Europe. Albanians 

now dominate the heroin market in Switzerland and have gained substantial shares of the money 

laundering and arms smuggling businesses. In North America, Albanians occupy dominant 

positions in the so-called YACS (Yugoslav-Albanian-Croatian-Serb) gangs that now engage in a 

variety of crimes. Recently, Albanian groups have been seeking to establish relations with 

 

123 Galeotti. 124 Galeotti. 125 Galeotti. 126 Galeotti. 
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Georgian and Armenian organizations in order to shorten the heroin supply line from Central 

Asia. However, both expansion and ethnic integration tend to weaken the structure and solidarity 

of the traditional ethnic Albanian criminal organizations, and expansion into markets such as 

Hungary has brought resistance from groups such as the Russian Solntsevo organization.127

Besides narcotics, the routes through Albania also carry large numbers of women for the 

illegal sex trade and illegal arms. As in other East European societies, the sex trade is fueled by 

the availability of large numbers of women lacking economic prospects at home and seeking 

employment in the West. If they become prostitutes, society condemns them if they return to 

Albania, and border guards treat them as criminals. Thus, even women who return to Albania 

after being smuggled out seek to once again find work in a Western country, because they see no 

other choice.128

The illegal arms trade has been fed by an estimated 550,000 military weapons, nearly 1 

billion rounds of ammunition, and 16 million explosive devices that were removed from military 

stockpiles during the rioting of 1997. Although only 200,000 of the weapons have been 

recovered in the government’s guns-for-money swap programs, in August 2002 the government 

abolished the special police unit assigned to collect weapons. Despite urging by international 

agencies, and despite the fact that criminal organizations are believed to have gained possession 

of a large share of the unaccounted-for equipment, the Albanian parliament has passed no new 

national legislation on the subject.129

Former Warsaw Pact European Nations 

Although Bulgaria, the Czech Republic, Hungary, Poland, Romania, and Slovakia exhibit 

significant diversity in domestic conditions hospitable to organized crime and terrorist 

organizations, some strong similarities also exist. First, none of these countries is known to have 

been a significant host or victim of terrorist organizations. Second, four of the six have been 

accepted for membership in the next expansion of the European Union (probably in 2004), and 

the remaining two, Bulgaria and Romania, had the status of candidate countries in mid-2003. In 

 

127 Galeotti. 128 Agim Kanani, “Albania: Breaking the Cycle of Prostitution,” Institute for War and Peace Reporting, Balkan 

Crisis Report, 19 April 2002. <http://www.iwpr.net> 

129 Agim Kanani, “Albania: Cash-for-Guns Plan Misfires,” Institute for War and Peace Reporting report, 4 

November 2002. <http://www.iwpr.net> 
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November 2002, Bulgaria, Romania, and Slovakia were accepted to join the North Atlantic 

Treaty Organization in 2004 (the other three gained membership in 1999). Membership or 

candidate status in one or both organizations has been a strong incentive for these countries to 

take such measures as strengthening border controls and arms export controls. Border controls 

are especially important to reduce trafficking in states bordering the former Soviet Union and the 

Balkans. In the 1990s, all six countries sold arms on the world market rather indiscriminately, 

having inherited large amounts of surplus military equipment and production capability from the 

Warsaw Pact era and experiencing severe economic crises in the painful post-Soviet 

readjustment period of the 1990s. Hungary, which played a different role in the defense structure 

of the Warsaw Pact alliance,130 was not left with as large a concentration of arms as the other 

five. Although since that time the five principal holders of military equipment have taken 

significant steps toward controlling the destination and conditions of such sales, in 2002 most 

still had gaps in legislation or enforcement that made them potential source countries for illegal 

arms traffickers. Contributing to this situation is the economics of surplus military equipment: to 

maintain or destroy such equipment requires large amounts of money, making resale a much 

more attractive option. Accordingly, in 2002 the defense ministries of all five nations announced 

the availability of large numbers of tanks, artillery systems, and smaller weapons.131 Such 

availability has led inevitably to illegal arms transactions. 

Bulgaria 

Like other states emerging from communist dictatorship in the early 1990s, Bulgaria 

experienced rampant corruption and organized crime in the first half of that decade. Declining 

economic conditions combined with a class of powerful former communist officials and weak 

domestic law enforcement and civil institutions to allow a deluge of narcotics and arms 

smuggling, money laundering, and other forms of criminal activity. Lax law enforcement 

encouraged the formation of organized crime groups. Based on Bulgaria’s very close relations 

with the Soviet Union, the post-Soviet connection with Russian criminal groups has been 

 

130 Stephen R. Burant, ed., Hungary: A Country Study (Washington, D.C.: GPO, 1990), 236. 131 Human Rights Watch, “Arms Trade, Human Rights, and European Union Enlargement: The Record of Candidate 

Countries,” 8 October 2002. <http://www.hrw.org> 
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especially strong.132 Government corruption, which was a key element in the growth of criminal 

activity in the early and mid-1990s, has decreased somewhat in recent years. Transparency 

International’s 2002 Corruption Perception Index placed Bulgaria 45th among the 102 nations 

evaluated, marginally higher than the previous rating.133 The 2002 corruption index of the U.S. 

Agency for International Development rated corruption in Bulgaria as unchanged from the 

previous evaluation.134

Wars and ensuing sanctions in the nearby former Socialist Federal Republic of 

Yugoslavia provided opportunities for smuggling fuel, arms, cigarettes, alcohol, and stolen cars 

from Bulgaria into Yugoslavia. Aided by the non-existence of financial laws, groups laundered 

money by fictitious investments in a variety of offshore firms, including banks. Laundered 

money often returned to Bulgaria in investments in privatized state enterprises. By the late 

1990s, Bulgaria’s aspirations to membership in West European organizations promoted stricter 

law enforcement, including stronger border controls and cooperation with international law 

enforcement agencies. However, Bulgaria’s geographic position, its close cultural affinity with 

Russia, and remaining gaps in law enforcement have promoted a more sophisticated but still 

widespread range of organized criminal activities, most of which have a significant transnational 

component.135

Security analyst Elizabeth Konstantinova describes transnational crime in Bulgaria thus: 

“Over the past decade organized crime networks in the country have evolved as an essential link 

supporting global criminal groups operating the Balkan transit route for smuggling drugs from 

Asia to the European Union. Their activities have increasingly extended into areas affecting 

domestic and regional security, namely illicit traffic of human beings, money laundering, and 

arms smuggling.”136

Many of those activities involve cooperation with international crime organizations. 

According to Deputy Minister of the Interior Boiko Kotzev, “Bulgarian organized crime groups 

mostly serve as auxiliary units to powerful Turkish and Albanian networks, which dominate the 

 

132 Elizabeth Konstantinovna, “Bulgarian Gangs Provide Key Link in European Trafficking Chain,” Jane’s 

Intelligence Report, 1 November 2002; and Robert Kaplan, “Crime and Democracy in Bulgaria,” The Globalist, 23 

June 2001 <http://www.theglobalist.com> 

133 Balkan Times, 29 August 2002 <http://www.balkantimes.com> 134 Southeast European Legal Development Initiative, “Corruption Indexes: Regional Corruption Monitoring in 

Albania, Bosnia and Herzegovina, Bulgaria, Croatia, Macedonia, Romania, and Yugoslavia,” April 2002, 14. 

135 Konstantinova. 136 Konstantinova. 
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drug traffic from Asia and Afghanistan through the Balkans into the EU.”137 Bulgarian groups 

also are known to cooperate with criminal networks from the former Yugoslavia, Ukraine, 

Russia, Greece, Italy, the Czech Republic, Germany, Spain, Norway, and Brazil in smuggling 

narcotics, arms, cigarettes, alcohol, and people as well as the sexual exploitation industry, 

counterfeiting, and credit card fraud. For narcotics traffic, Bulgaria is the shortest route between 

the Black Sea and the republics of the former Yugoslavia. In trafficking operations, Bulgarian 

groups usually are limited to domestic activities.138

In the 1990s, Russian narcotics groups cultivated some markets in Bulgaria, but their 

main goal was control of the transit routes via Bulgaria toward the West, which carry as much as 

90 percent of the heroin passing from Turkey to the West. That dominant position has been 

disturbed by turf struggles and the commitment of the Bulgarian government to dislodge Russian 

organized crime from Bulgarian soil.139 However, it is likely that domestic criminal groups such 

as the Security Insurance Company and the Power Insurance Company (whose names derive 

from the term that protection rackets adopted to conceal their true activities from government 

investigation in the 1990s),140 have maintained their traditional close connections with their 

Russian equivalents. Those “companies,” which in the 1990s were the two largest criminal 

groups in Bulgaria,141 have declined in power in recent years. 

Although the domestic demand for drugs is relatively small, illicit Bulgarian laboratories 

have begun manufacturing synthetic drugs. Materials for such production are readily available 

from the country’s well developed pharmaceuticals industry. Some of the laboratories discovered 

by authorities were run by Arabs, indicating a connection with markets in the Middle East.142

Experts rate trafficking in women as the second most profitable activity of Bulgarian 

organized crime groups, next to narcotics trafficking. The same geographical factors promote all 

forms of smuggling in Bulgaria. Efforts to curtail trafficking have been hampered by limited 

resources, the complicity of law and government officials in trafficking operations, and the lack 

of a specific law prohibiting trafficking in humans. In 2002 the Bulgarian government considered 

 

137 Quoted in Konstantinovna. 138 Konstantinovna. 139 “Drug War for $1.2 Billion,” Trud [Sofia], 6 February 2001 (FBIS Document EUP20010206000047). 140 Jovo Nikolov, “Crime and Corruption After Communism: Organized Crime in Bulgaria,” East European 

Constitutional Review, 6, no. 4 (Fall 1997). <http://www.law.nyu.edu/eecr/vol6num4/feature/organizedcrime.htm> 141 Denis Ryabtsev, interview with Emanuil Yordanov, minister of the interior of Bulgaria, Segodnya [Moscow], 6 

December 2000 (FBIS Document CEP20001206000268). 142 Konstantinovna. 
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establishing a national committee to establish policy on human trafficking.143 However, in April 

2003 a report by the U.S. Agency for International Development stated that the Bulgarian 

government had no trafficking prevention programs.144 The IOM continues its trafficking 

awareness campaign that began in 2000. The capacity of the Bulgarian public institutions in the 

area of trafficking in persons is still weak, the inter-agency coordination and the cooperation 

with the non-governmental sector is in its initial stage. The governmental 

institutions and non-governmental entities on central and local levels require support in terms of 

technical expertise and funding. In the meantime, the government has not provided direct 

protection to victims of trafficking, and convictions under existing laws have been few. Women 

originating in Bulgaria or transited through Bulgaria most often go to France, Spain, the 

Netherlands, and Greece. In 2001 and 2002, authorities uncovered a total of 48 organized crime 

groups trafficking in women or involved in coercive prostitution. As Bulgaria’s tourist industry 

grows, the country is gradually becoming a destination point as well as a source for these 

activities. Bulgarian authorities expect that the country’s location will increase connections with 

international trafficking lines.145 In 2002, improved controls on Romania’s eastern border forced 

the flow of human trafficking southward, to the border between Bulgaria and Romania, which in 

July 2002 was described as an “uncontrolled territory.” The main concentration of illegal 

movement was the Lom region of northwestern Bulgaria, where trafficking groups were able to 

cross the Danube into Romania with ease.146

Foreign and Bulgarian criminal groups also take advantage of Bulgaria’s location to 

move stolen vehicles from Western Europe (especially Spain and Germany) to Turkey, Greece, 

Albania, and Macedonia, as well as across the Black Sea into Ukraine, Russia, and Georgia. An 

elaborate system of Bulgarian “chop shops” removes vehicle identifications. Some vehicles are 

resold in Bulgaria.147

Other large-scale organized criminal activities are currency counterfeiting and compact 

disc (CD) piracy. In 2000-01, authorities discovered five counterfeit printing shops in which 

counterfeiting rings were manufacturing United States, German, and Greek currency and false 

 

143 Report from Bulgarian Press Agency (BTA), 15 August 2002 (FBIS Document EUP20020815000210). 144 U.S. Agency for International Development, “Combating Human Trafficking in Bulgaria,” 25 April 2003. 

<http://www.usembassy.bg/prog/aps.htm> 

145 U.S. Department of State, Trafficking in Persons Report, June 2002. <http://www.state.gov/g/tip/rls/tiprpt/2002> 146 Report in Adevarul [Bucharest], 25 July 2002 (FBIS Document EUP20020725000182). 147 Konstantinova. 
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credit cards. In 1997 international watchdog organizations threatened to blacklist Bulgaria 

because of the huge volume of pirated CDs that were emanating from that country as a result of 

weak commercial copyright laws and lax law enforcement. Although the blacklist threat brought 

stricter enforcement and some operations moved to “greener pastures” in republics of the former 

Soviet Union, in 2001 authorities confiscated 188,000 pirated CDs. That volume indicates that 

Bulgaria is not yet able to control this form of commercial crime.148

Bulgaria’s defense industry, a major source of arms and ammunition in the Soviet era, 

continues to manufacture assault rifles and guided weapons systems. Bulgaria also has an 

estimated 700 each of surplus tanks, artillery pieces, and armored personnel carriers and 160,000 

tons of ammunition, all remaining from the Soviet era. In recent years, Bulgarian authorities 

have identified 29 criminal groups using these stocks to participate in the international illegal 

arms trade. Although arms export controls have been improved gradually since the mid-1990s, in 

recent years large amounts of illegally shipped weapons and ammunition and 25 containers of 

radioactive substances have been confiscated.149 In mid-2002, new arms trade legislation failed 

to establish mandatory minimum export criteria, improve transparency in arms transactions, or 

provide for destruction rather than resale of surplus weapons.150 In part, a shortage of financial 

resources explains Bulgaria’s failure to destroy surplus heavy conventional arms because it lacks 

financial resources. In mid-2002, the Bulgarian government reported the intention to export 

nearly 200 large-caliber artillery systems.151

In the late 1990s, Bulgaria passed money-laundering legislation in recognition of the 

vulnerability of its financial system to the laundering of illegal money from narcotics sales and 

commercial crimes. However, in 2000 the Financial Action Task Force of the Organisation for 

Economic Coordination and Development found that the new legislation had significant 

loopholes such as the lack of coverage of negligent laundering, the inability to enforce foreign 

confiscation orders, and the inability to try a legal entity for laundering.152 In early 2002, a 

 

148 Konstantinova. 149 Konstantinova and International Action Network on Small Arms, “Central and Eastern Europe Remains 

Important Source and Transit Route for Arms: Country Analysis.” <http://www.saferworld.org.uk> 150 Human Rights Watch, “Arms Trade, Human Rights, and European Union Enlargement: The Record of Candidate 

Countries.” 

151 Human Rights Watch, “Arms Trade, Human Rights, and European Union Enlargement: The Record of Candidate 

Countries.” 

152 Organisation for Economic Cooperation and Development, Financial Action Task Force on Money Laundering, 

“Members and Observers, PC-R-EV Committee.” <http://www1.oecd.org/fatf> 
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corruption index found that corruption was continuing to spread in Bulgaria at the same rate as it 

had in the 1990s, mainly because of socio-economic factors and the low legitimacy of the state in 

the view of the public.153

Beginning in 1997, Bulgaria joined international and regional efforts such as the 

Southeast European Cooperative Initiative (SECI), which is aimed at reducing illegal trafficking 

in women. In 2002 the SECI established a regional center to combat various types of crossborder crime. The government of Prime Minister Simeon Saxe-Coburg has passed legislation 

criminalizing bribery, participation in criminal groups, and money laundering.154 However, as in 

other countries in the region, the efficacy of those laws will depend on the resources and training 

available to enforcement agencies. 

The Czech Republic 

The Czech Republic’s arms trade legislation has left the country vulnerable to some 

trafficking in illegal weapons. According to Czech intelligence sources, arms traffickers have 

moved illegal shipments through the Czech Republic by submitting false documents and by 

obtaining licenses in partnership with legitimate arms companies.155 Economic crime and 

corruption also have grown substantially in recent years. According to a federal authority, 

instances of bribe taking by public officials increased from 6 in 1993 to 53 in 2000.156 In mid2002, the European-Czech Forum, a multinational business watchdog agency, called for drastic 

reform of the Czech Republic’s judicial and regulatory procedures in order to reduce economic 

crime. Public attention focused on corruption at that time because a former Foreign Ministry 

official confessed to collecting bribes from companies seeking contracts from the ministry.157

 

153 Southeast European Legal Development Initiative. 154 Konstantinova. 155 Human Rights Watch, “Arms Trade, Human Rights, and European Union Enlargement: The Record of Candidate 

Countries.” 

156 “Top Attorney Calls for Radical Solution to Widespread Corruption,” RFE/RL Crime and Corruption Watch, 2, 

no. 13 (4 April 2002). <http://www.rferl/corruptionwatch> 157 “Suspected Accomplice Says She Spent Years Collecting Bribes Related to Ministry Contracts,” RFE/RL Crime 

and Corruption Watch, 2, no. 27 (27 July 2002). <http://www.rferl/corruptionwatch> 
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Hungary 

In the past decade, organized crime has concentrated in Hungary because of that 

country’s fast-growing commercial ties with the West, its well-developed transportation and 

communications infrastructure, and its geographical location in the center of Europe. In a 2001 

report, Jane’s Intelligence Review estimated that 160 to 180 criminal organizations were active 

in Hungary, with particular concentration in Budapest. At that time, organized crime controlled 

an estimated 60 percent of Hungarian enterprises, including major financial institutions. These 

organizations, which participate in a wide variety of criminal activities, often have links with 

groups in Russia, for whom Hungary has been a vital connection with the West. In 2000 the 

activities of the Russian Solntsevo group reportedly increased in Hungary, and Semen 

Mogil’yevich, head of the rival Russian Solomon group, is known to have pursued various 

business and smuggling activities from Budapest in recent years.158 The recent influx of foreign 

groups has caused considerable instability and violence in Hungary’s criminal underworld, while 

diminishing the ethnic homogeneity of individual criminal operations.159

Hungary is the next step after Bulgaria and Romania on the main narcotics route from 

Southwest Asia to Western Europe. According to Interpol, in 2000 Hungary had the third-largest 

amount of transited narcotics in the world; as many as 64 groups were involved in this traffic. In 

2000 the Hungarian Customs Authority reported sharp increases in seizures of heroin, marijuana, 

hashish, and opium.160 In September 2002, Hungarian authorities uncovered a very large 

operation smuggling cocaine from Columbia, allegedly run by a Hungarian-Italian company 

based in Italy.161 Hungary also has been an important transit country for the smuggling of arms, 

vehicles, and stolen works of art. In the 1990s, conflicts in Yugoslavia increased the smuggling 

of arms. 

Hungary is both a destination and a transit country for illegally trafficked migrants as 

well as women moving into the sex industries of Austria, Germany, Spain, the Netherlands, Italy, 

France, Switzerland, and the United States. The main source countries for such women are 

 

158 Daša Matejickova, “Ivan I. Miško on His Contacts with S. Mogilyevich, Strong Man of the Ukrainian Mafia in 

the World,” SME [Bratislava], 11 January 2000 (FBIS Document FTS20000115000458). 159 Kelly Hignett, “Hungary Takes On the Mafia,” Jane’s Intelligence Review, 1 January 2001. 160 Hignett. 161 “Major Busts Made by Hungarians, Russians, Romanians,” RFE/RL Crime and Corruption Watch, 2, no. 35 (4 

October 2002). <http://www.rferl.org/corruptionwatch/2002> 
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Romania, Ukraine, Moldova, Poland, Yugoslavia, and China. Hungary has not actively 

prosecuted traffickers, although anti-trafficking laws exist. Police in eastern Hungary, the entry 

area for a high percentage of such traffic, are not well equipped to deter traffickers, and police 

reportedly treat individual victims as criminals.162

The relative success of Hungary’s economic liberalization in the 1990s has combined 

with the secrecy provided by Hungary’s banking laws to promote money-laundering activities. 

The scale of those activities has increased with the scale of illegal trafficking and other activities, 

particularly those of Russian groups. In 1999 and 2000, Hungarian financial institutions were 

implicated in two major international money- laundering schemes.163 Money laundering has been 

promoted by the fact that luxury cars and real estate often are purchased with cash in what still is 

largely a cash-based economy. Hungary’s 2,000 bureaus of exchange also have been vulnerable 

to money laundering because such institutions (and all other enterprises in Hungary’s nonfinancial sectors) have not been monitored for such activity. Until legislation stopped the practice 

in 2002, anonymous savings passbooks were permitted for Hungarian citizens and foreign 

nationals.164 Following the passage of major new money laundering legislation in November 

2001, Hungary was removed from the Organization for Economic Cooperation and Development 

(OECD)’s list of noncompliant countries in mid-2002.165

Poland 

According to a 2002 estimate, 80 percent of the 13.5 million people who cross Poland’s 

eastern borders with Belarus and Ukraine annually are engaged in some form of smuggling. This 

regular process mainly moves illegal alcohol, cigarettes, and migrants into Białystok and other 

urban centers of eastern Poland. In 2000 this activity cost Poland an estimated US$4 billion in 

revenue. In 2001 the amount of smuggled goods doubled and confiscated narcotics increased by 

a factor of ten; in mid-2002, Polish authorities again reported substantial increases in illegal 

immigration and smuggling across the Poland-Ukraine border.166 Poland also is a transit country 

 

162 U.S. Department of State, Trafficking in Persons Report 2002. 163 Hignett. 164 Ulrika Lomas, “Hungary Bans Anonymous Accounts in Response to FATF Listing,” Tax-News.com [Brussels], 3 

September 2001. <http://www.tax-news.com/asp/story/story_print.asp?/storyname=5188> 

165 U.S. Department of State, International Information Programs, “Hungary, Israel Removed from Money 

Laundering Blacklist,” report of 21 June 2002. <http://usinfo.state.gov/topical/econ/mlc/02062101.htm> 166 Report from UTI Television, Kiev, 12 July 2002 (FBIS Document CEP20020713000058). 
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for illegal trafficking in women, most of whom come from the former Soviet Union, Bulgaria, 

and Romania. Local police corruption is a major contributing factor to domestic prostitution, 

especially in the western province of Zielona Góra.167

Lax controls on Poland’s eastern border also are a factor in the presence in Poland of 

numerous criminal gangs from Belarus and Russia, which are able to maintain connections with 

their homeland. Local conditions in Warsaw have enabled Polish gangs to establish relations 

with and protect such groups. According to a 2002 report, several important Russian gang 

leaders smuggle narcotics and vehicles and launder large amounts of money through real estate 

transactions in Warsaw.168 In December 2002, the Ministry of Finance estimated that between 

US$1.5 billion and US$8 billion of illegal profits from narcotics, theft, prostitution, gambling, 

and trafficking in persons is laundered in Poland annually. Poor cooperation from financial 

institutions, insufficient police resources, and legal restrictions on dissemination of information 

by prosecutors have hindered enforcement of Poland’s money-laundering laws, which 

theoretically comply with European standards.169

An important factor supporting this activity is that, in support of an informal “central 

European community,” which includes the Baltic states, Belarus, and Ukraine, Poland requires 

no entry visas. That situation will change in July 2003, when Poland plans to begin requiring 

visas in preparation for its entry into the European Union in 2004.170 Another factor in the 

porosity of the eastern border has been the use of as many as 3,000 conscripts in the Border 

Guard Service.171

Romania 

Trafficking in migrants and women is a major activity of transnational criminal groups 

active in Romania. Romania lies on the natural westward route of refugees from Afghanistan, 

Iraq, and other eastern points of origin. The Romanian Border Police identify two trafficking 

 

167 United Nations, Office for Drug Control and Crime Prevention, “The Case of Poland,” 1 October 2002 

<http://www.undcp.org> 

168 Rafal Pasztelanski, “You Should Not Mess Around with ‘Wolf,’” Zycie [Warsaw], 28 August 2002 (FBIS 

Document EUP20020830000246). 

169 “Poland: Country Used to Launder Large Amounts of Money,” RFE/RL Crime and Corruption Watch, 2, no. 41 

(3 December 2002). <http://www.rferl.org/corruptionwatch> 170 Bernard Osser, “In the East, Specter of Another Iron Curtain,” Le Figaro [Paris], 8 March 2002 (FBIS Document 

EUP20020310000003). 

171 “Up to Code,” The Polish Voice, no. 21 (2002). <http://thepolishvoice.pl> 
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routes. The first, used mainly by Iraqis, passes from Turkey into Romania via Bulgaria. Migrants 

then use neighboring Hungary as the transit point to enter the European Union countries. The 

second route is used primarily by Afghan and African migrants, who fly to Moscow, then enter 

Romania via Moldova or Ukraine. Faulty border controls are a major factor in illegal trafficking: 

parts of Romania’s border are not well patrolled, and the Border Police have not cooperated 

effectively with their Bulgarian and Moldovan counterparts.172

In 2001 and 2002, Romania improved its compliance with international standards for 

eliminating trafficking in persons by improving cooperation with neighboring states and among 

domestic agencies and strengthening border security measures. However, the 2002 U.S. 

Department of State trafficking report found limitations in the prosecution of public officials 

involved in trafficking. Because Romania passed its first law criminalizing trafficking only in 

December 2001,173 the enforcement process was not yet fully developed as of the end of 2002. 

Romania has been a primary Central European transit point for narcotics arriving from 

Turkey along the “Balkan route.” Large amounts of precursor chemicals also travel through 

Romania in the other direction, from Western Europe to Turkey. The narcotics divisions of 

Romania’s law enforcement have not been sufficient to deal with this movement, and the main 

anti-narcotics agency, the Directorate for Combating Organized Crime and Anti-Drug 

Operations, has itself been implicated in the drug trade. The low pay of law enforcement officials 

remains an incentive for corruption that prevents enforcement of narcotics and other laws.174

Slovakia 

From the Warsaw Pact era, Slovakia retains substantial research-and-development 

capability to produce major weapons.175 The nation’s arms export controls have a legislative 

loophole that inhibits effective monitoring of arms transiting the country; as of 2002, no 

government license was required for arms remaining in Slovakia for less than seven days. In 

mid-2002, new arms trade legislation failed to correct this loophole and failed to improve the 

 

172 Paul Christian Radu, “Romania Tackles Human Traffickers,” Institute for War and Peace Reporting, Balkan 

Crisis Report, no. 9 (9 August 2002). http://www.iwpr.net> 173 U.S. Department of State, Trafficking in Persons Report 2002. 174 U.S. Department of State, Bureau for International Narcotics and Law Enforcement Affairs. 175 International Action Network on Small Arms. 
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transparency of the arms trade.176 In recent years, international authorities have observed a 

number of questionable arms transfers through Slovakia, including major shipments to Liberia 

(as a point of origin) and to Angola (as a transit point from Iran).177 Arms export control will 

become a more important issue in the following decade, as Slovakia’s military modernization 

program makes an estimated 200 tanks and 300 armored personnel carriers redundant.178

The process of privatizing Slovakia’s economy has resulted in substantial amounts of 

economic crime, notably tax evasion, larceny, embezzlement, and fraud. A substantially cashbased economy, combined with dispersed and non-transparent banking and financial institutions 

and casinos, have made Slovakia a hospitable environment for laundering profits from the 

narcotics traffic that passes through the country.179

Nations of the Former Soviet Union 

The Baltic States 

The Baltic States─Estonia, Latvia, and Lithuania─have similar problems in a number of 

areas, including the presence of transnational crime organizations and the domestic conditions 

that invite such a presence. However, no major terrorist presence or activities have been 

reported. The three countries are located between Russia, home of one of the world’s largest 

networks of organized crime, and the West European countries that often are the primary 

markets for goods and services sold by transnational crime groups. In the late Soviet period, the 

“Baltic Corridor,” which already had existed for many years for both legal and illegal trade, 

became an important pathway for an “illegal economic free-for-all as goods and people passed 

through from east to west and west to east.”180 By economic necessity, the Baltic states have 

continued many of their Soviet-era commercial ties with Russia along their segment of the Baltic 

Corridor, inhibiting efforts to curtail illegal traffic on the existing corridor. 

 

176 Human Rights Watch, “Arms Trade, Human Rights, and European Union Enlargement: The Record of Candidate 

Countries.” 

177 Human Rights Watch, “World Report 2002.” <http://www.hrw.org> 178 Human Rights Watch, “Arms Trade, Human Rights, and European Union Enlargement: The Record of Candidate 

Countries.” 

179 Council of Europe, European Committee on Crime Problems, Select Committee of Experts on the Evaluation of 

Anti-Money Laundering Measures, “Second-Round Evaluation Report on Slovak Republic,” 8 April 2003. 

<http://www/coe.int> 

180 Paddy Rawlinson, “Russian Organized Crime and the Baltic States: Assessing the Threat,” Centre for 

Comparative Criminology and Criminal Justice, Working Paper 38/01, 8. 
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Among the republics of the former Soviet Union, the Baltic countries have made the most 

progress in eliminating conditions that promote transnational criminal activity. In 1996 the Baltic 

countries organized the Task Force on Organized Crime in the Baltic and established crime units 

to combat specific types of crime. In 2002 the Task Force continued to evaluate progress, issue 

reports, and act as an information clearing-house for the member countries. The most frequent 

types of transnational crime in the region have been illegal immigration, vehicle theft, money 

laundering, contract murders, narcotics trafficking, and other types of smuggling.181 In general, 

the Baltic states have not had sufficient resources or personnel training to enforce new legislation 

dealing with trafficking in human beings or narcotics.182 As in other parts of Europe, 

improvements in financial systems (rapid communications, computer use, and electronic transfer 

of funds) have facilitated money laundering in the Baltics.183

Estonia

According to the U.S. Department of State’s most recent narcotics report, the activity and 

international connections of Estonian narcotics traffickers have expanded significantly in recent 

years, and domestic demand for narcotics has increased in proportion. The Ministry of Internal 

Affairs of Estonia estimated in 2001 that narcotics transit generated 70 percent of the income of 

domestic criminal groups, with domestic sales accounting for 30 percent. Although staffing of 

police narcotics specialists has increased, the U.S. Department of State reported in 2001 that as 

presently constituted the police force was unable to reduce the flow of narcotics or associated 

crimes.184 In recent years, Estonian and Russian narcotics groups have gained a firm foothold in 

the narcotics markets of Finland, although Estonia’s strict monitoring of its Russian minority has 

reduced the Russian presence in this activity. Estonia’s successful prosecution of Russian crime 

bosses Boris Malinovskiy and Nikolay Bleskov in 1996 was the first stage of this process.185

Experts predict that Estonia’s imminent membership in the European Union will intensify 

 

181 Jan K. Collins, “Doing Business in the Baltic.” <http://research.moore.sc.edu/Research> 182 “Trafficking in Women in the Baltic States: Legal Aspects,” Trends in Immigration, special issue, 2001. 183 Sabrina Adamoli, “Organised Crime and Money Laundering Trends and Countermeasures: A Comparison 

Between Western and Eastern Europe, in Petrus C. van Duyne, Vinzenzo Ruggiero, Miroslav Scheinost, and Wim 

Valkenburg, eds., Cross-Border Crime in a Changing Europe (Huntington, New York: Nova Science Publishers, 

2001), 187. 

184 U.S. Department of State, Bureau for International Narcotics and Law Enforcement Affairs, International 

Narcotics Control Strategy Report 2001. <http://www.state.gov/g/inl/nrcrpt/2001> 185 Patricia Rawlinson, “Baltic States Battle Organised Crime,” Jane’s Intelligence Review, 1 November 2001. 
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interdiction of the smuggling of items such as cigarettes and liquor, which authorities often have 

ignored. Smuggling of those commodities has been concentrated in Estonia’s coastal islands, 

which present a difficult target for enforcement. 

The manufacture of amphetamines and methamphetamines now constitutes the majority 

of Estonia’s illegal narcotics trade. The Finnish market, where most of this production is sold, is 

promoted by the price differential between Estonia and Finland and the large numbers of Finnish 

tourists in Estonia. As the Russian presence has receded, Estonian criminal groups have 

established new links with groups in Finland and in South America.186 Some narcotics traffickers 

eventually expanded their activities to include trafficking in human beings. That form of 

trafficking most often brings people from Russia to Scandinavian countries; the main organizers 

of such activity have been Scandinavians rather than Estonians.187 This activity took advantage 

of the failure of Estonian law to cover specifically trafficking in persons. Although Estonia had 

upgraded its legislation by 1999, trafficking continued in 2002. 

Beginning in the late 1990s, organized economic crime expanded in Estonia as new 

activities such as a black market in mobile telephones emerged. The activities of remaining 

Russian groups concentrated on racketeering, theft, vehicle trade, and violent crime as domestic 

groups delved into the profitable new areas in addition to narcotics trafficking. In the late 1990s, 

organized crime also moved into the real estate industry, taking advantage of corruption among 

municipal officials to gain large profits on bogus transactions that sometimes also involve money 

laundering.188 Some Finnish and Swedish groups also are active in the production and trafficking 

of narcotics and the recruiting of prostitutes.189

Latvia

The chaos that followed Latvia’s independence in 1991 saw the development of 

especially strong relations between Latvian and Russian crime groups, in part because Latvia had 

the largest Russian minority population of the three Baltic states. The leading criminal 

 

186 Patricia Rawlinson. 187 Jüri Mois, “Organized Crime and Illegal Immigration in Estonia,” speech to 14th session of Baltic Assembly, 

May 27, 1999. <http://www.baltsam.org/activity/documents> 

188 Mois. 189 University of Exeter, Department of Politics “Organised Crime in Estonia,” 2001. 

<http://www.ex.ac.uk/politics/pol_data/undergrad/jaakko/caseestonia> 
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associations that appeared in Latvia in the 1990s were based on athletic clubs, as were some of 

the contemporaneous Russian groups (see Russia). Russian leaders of major Latvian groups 

include Ivan Kharitonov (now in prison) and Boris Raygorodskiy, who retained close contact 

with their counterparts in Russia.190 Relations between the Latvian and Russian groups were 

especially evident in Riga, the regional financial center, where Russian crime leaders such as 

Aleksandr Lavent and Vladimir Leskov became dominant figures in Latvia’s developing 

financial system.191

In the first post-Soviet years, a major activity of organized crime was the smuggling of 

precious metals from Russia through Estonia to the West, in what became known as Estonia’s 

“Metal Age.” Some of the trafficking lines from that era remain in existence, and the smuggling 

of narcotics, alcohol, and other illegal and highly taxed items remains a central part of Estonia’s 

organized crime activity.192 In the 1990s, organized crime in Latvia moved into more 

“businesslike” activities such as banking, and the protection rackets that had flourished under 

Russian leadership in the early 1990s evolved into private security agencies. In the mid-1990s, 

the U.S. Department of State characterized Latvia’s banking system as vulnerable to the 

laundering of narcotics money. The reasons for this evaluation were the lack of money 

laundering legislation, the absence of strict banking accountability, the lack of currency reporting 

requirements, and the loose regulations under which many of Latvia’s banks had been 

founded.193 Some of those problems have been addressed in subsequent years. 

The thriving post-Soviet black market spawned high levels of official graft. The United 

States considered high levels of corruption in Latvia’s government and security forces a 

substantial obstacle to sharing security information with this prospective NATO member.194 In 

2000-02, under pressure from the public and from West European multinational institutions to 

reduce corruption and conflicts of interest among government officials, the Latvian government 

passed significant legislation on those subjects. In November 2001, the chair of Transparency 

International’s Latvian branch rated that legislation as meeting the West European standard. 

 

190 Paddy Rawlinson, 16. 191 Paddy Rawlinson, 14. 192 “Organised Crime in Estonia.” 193 U.S. Department of State, Bureau for International Narcotics and Law Enforcement Affairs, International 

Narcotics Control Strategy Report 1996. <http:www.state.gov.g/inl/rls/nrcrpt/1996> 194 Fred Weir, “Baltics Step from Russia’s Shadow into Western Club,” The Christian Science Monitor, 20 

November 2002, 13. 
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However, she also noted that the laws had not yet been implemented and that Latvia still needed 

laws requiring political parties to report donations.195 In Transparency International’s 2002 

Corruption Perceptions Index, Latvia was rated 52d out of 102 countries evaluated.196 Reporting 

on legislative developments, Latvian journalist Valts Kalnins has observed that the new laws 

leave significant loopholes and that Latvia still has no effective law against money laundering. 

Kalnins noted that Latvia has no institutional experience in the control and investigation of such 

crimes; corrupt officials have been apprehended in a haphazard way, mainly at lower levels of 

responsibility. Conflict-of-interest legislation does not specify precisely what actions by a 

government official constitute a conflict of interest.197

In controlling money laundering, Latvia currently has no organized accounting system by 

which to compare previously existing assets with current assets. Authorities have not enforced 

existing legislation that prohibits the establishment of anonymous bank accounts, and Latvia has 

no legislation against negligent laundering.198 Fully anonymous accounts are illegal, but 

numbered accounts, which can substantially reduce access to suspicious transactions, are legal.199

A report on Latvia by the Council of Europe’s Anti-Corruption Group found, except for the 

Security Police, “nothing to suggest that complex police methods are being used. It appeared that 

there is a lack of imagination and officially organized training in the fight against corruption.”200

Another 2001 Council of Europe report faulted Latvia for insufficient reporting requirements for 

banks and exchange houses. In 2001 the head of the Environmental State Inspectorate, the 

deputy chief of the economic police, 12 police officers, 2 border guards, and 14 employees of the 

Ministry of Interior were arrested for accepting bribes.201

International narcotics officials have identified Latvia as primarily a narcotics transit 

country, although the production of synthetic illicit drugs increased in the 1990s. As in the other 

 

195 “Latvia’s Anticorruption Effort Gets High Marks,” RFE/RL Crime and Corruption Watch, 1, no. 6 (6 December 

2001). <http://www.rferl.org/corruptionwatch/2001> 

196 Transparency International, “Corruption Perceptions Index 2002.” 

<http://www.transparency.org/cpi/2002/cpi2002en.html> 

197 Valts Kalnins, “Corruption: The Battle Is Not Finished,” Diena [Riga], 30 August 2002 (FBIS Document 

CEP20020830000048) 

198 Latvia, Ministry of Justice, “Status Report of the Republic of Latvia Under the Baltic Anti-Corruption Initiative,” 

April, 2002. <http://www.nobribes.org/Documents/Latvia_BACIReport_2002.doc> 

199 Council of Europe, European Committee on Crime Problems, Select Committee of Experts on the Evaluation of 

Anti-Money Laundering Measures, “First Evaluation Report on Latvia,” 19 January 2001. <http://www.coe.int> 200 Kalnins. 201 “New Bribery Scandal,” RFE/RL Crime and Corruption Watch, 1, no. 6 (6 December 2001). 

<http://www.rferl.org/corruptionwatch> 
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Baltic states, transit activity increased in the 1990s as the “Balkan route” was disrupted by war. 

Latvian and Russian groups have primarily carried out that transit. In recent years, the Solntsevo 

group, one of Russia’s largest criminal organizations, has increased its activity in Latvia.202 The 

general trafficking route extends from Central Asia, through Russia and Belarus, then through 

the Baltic States into Scandinavia. Most of Latvia’s narcotics trafficking is done by organized 

crime groups that began with cigarette and alcohol smuggling, although recently some groups 

have specialized in narcotics. Although the volume of trafficking is small compared with larger 

European countries, it has increased significantly in recent years; in 2000 and 2001, the annual 

volume of large narcotics interdictions doubled compared with the volumes of previous years.203

Cooperation between Latvia’s Ministry of Finance and the Ministry of Interior, the two 

agencies responsible for narcotics control at the borders, has not been effective at the working 

level. Coordination with the other Baltic states also is weak. The resource base (human, material, 

and financial) for customs inspections is not adequate to overcome the sophisticated concealment 

methods used by today’s narcotics traffickers. Inspectors limit their searches of potential drugcontaining vehicles because they fear being held responsible for damage. Latvian border 

authorities continue to emphasize inspection for smuggled taxable items such as cigarettes and 

alcohol.204 Nevertheless, the weaknesses in border control have promoted the smuggling of 

counterfeit goods, particularly cigarettes, through Latvia and to the West. In December 2001, 

authorities destroyed 25 million fake cigarettes that had been confiscated by customs police.205

In recent years, Latvia’s roles as a source and transit country for trafficking in prostitutes 

to Scandinavia and Western Europe have increased as domestic groups have established links 

with international systems trafficking in women. As of mid-2002, Latvia did not have a 

comprehensive law against trafficking in humans, although trafficking for sexual exploitation is 

illegal. According to Interpol, prostitutes on the Latvian route also become involved in money 

laundering, document counterfeiting, and narcotics sales.206

 

202 “Latvian Officials May Have Interest in Russian Criminal Group,” Neatkariga Rita Avize [Riga], 22 February 

2001 (FBIS Document CEP20010222000055). 

203 United States Department of State, International Narcotics Control Strategy Report 2001. 204 U.S. Department of State, International Narcotics Control Strategy Report 2001. 205 Coalition for Intellectual Property Rights, “Latvian Government Incinerates 25 Million Counterfeit Cigarettes,” 

press release, 10 December 2001. <http://www.cipr.org/activities> 206 “Trafficking in Prostitutes Is Urgent Problem in Latvia—Interpol,” Leta [Riga], June 7, 2002 (FBIS Document 

CEP20020607000086). 
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Lithuania

Like Estonia and Latvia, Lithuania underwent a strong wave of organized crime in the 

chaotic years following the dissolution of the Soviet Union. In 1993 an estimated 30 criminal 

groups in Lithuania had international links. Despite Lithuania’s relatively small Russian 

minority, Russian groups were very active during the early 1990s. Lithuania’s proximity to 

Kaliningrad, a Russian enclave designated as a depository for superfluous military equipment, 

made it a center of illegal arms smuggling by Russian groups, which also armed themselves from 

that source. Although the Vilnius Brigade, run by a Georgian, was the most powerful group in 

Lithuania until 1995, indigenous groups generally have dominated organized crime from the year 

of independence.207 In the late 1990s, Lithuanian organized crime followed the pattern of that in 

Estonia and Latvia, moving into quasi-legitimate ventures in business and finance while 

maintaining a strong interest in profitable trafficking operations. The alleged financing of hotels 

in Vilnius by cocaine deals with Columbian dealers is an example of the recent blending of 

illegal and legal activities.208

Lithuanian criminal groups move narcotics into Western Europe from domestic 

laboratories and from Central and South America, and Lithuania is a transit point on a number of 

other routes. Poppy straw moves through Lithuania from Central Asia to Latvia and Kaliningrad. 

Heroin from Afghanistan crosses the Russian and Ukrainian borders on its way to Scandinavia. 

South and Central American cocaine arrives in Lithuania via Germany and the Netherlands. 

Amphetamines are produced domestically and also are imported from Poland and the 

Netherlands. Marijuana arrives from a number of foreign points.209 The volume of such imports 

has been increasing since 1995. Some narcotics traffickers also collaborate with stolen vehicle 

smugglers, using the same routes and at times concealing drugs within the vehicles.210

Money laundering, a financial tool of the groups involved in a variety of crimes, also has 

appeared in Lithuania. Although Lithuania began efforts to improve money laundering 

legislation in the 1990s, an assessment by the European Union in late 2001 found that those 

 

207 Patricia Rawlinson. 208 Patricia Rawlinson. 209 U.S. Department of State, International Narcotics Control Strategy Report 2001. 210 Patricia Rawlinson. 
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efforts had only succeeded in part.211 In 2002 new amendments were passed to the basic money 

laundering law of 1997.212

Trafficking in human beings, which was a major problem in Lithuania in the mid-1990s, 

decreased sharply with the introduction of stricter border procedures in the late 1990s; the 

European Union has praised the efficacy of legislation on visas, border controls, and 

immigration.213 However, the salaries of border guards, which remain very low, still make such 

individuals vulnerable to bribes, especially if and when a wave of emigration occurs abroad. In 

mid-2002, one incident of attempted smuggling of radioactive materials occurred in Lithuania. 

One kilogram of cesium-137 was seized after having been brought into Lithuania from an 

undisclosed country in the former Soviet Union. The potential buyer was identified as a German 

with likely connections to organized crime. Lithuanian authorities discovered several similar 

smuggling efforts in the mid-1990s.214

Belarus 

The state of the national economy has been an important factor in promoting organized 

crime in Belarus. Because Belarus has not passed through the rigors of conversion from a 

communist to a market economy (government policy has maintained state control of most 

production resources), privatization has not been a significant source of corruption. However, the 

overall poverty of the economy has stimulated various types of domestic criminal activity and 

cooperation with transnational groups. The standard of living has declined significantly since 

Belarus emerged from the collapse of the Soviet Union in 1991; in 2000 that standard was 

estimated to be four to five times lower than that of the Russian Federation.215 Although accurate 

unemployment figures are not available, it is known that the economy has contracted rather than 

expanded in recent years. 

 

211 European Union, “Activities of the European Union, Summaries of Legislation,” 1 February 2002. 

<http://europa.eu.int> 

212 Lithuania, Ministry of the Interior, Financial Crime Investigative Service, “Money Laundering Prevention: Legal 

Acts.” <http://www.fntt.lt/eng/mlp> 213 “Lithuania.” 214 Roman Kupchinsky, “Cesium Sale Thwarted in Lithuania,” RFE/RL Crime and Corruption Watch, 2, no. 22 (6 

June 2002). <http://www.rferl.org/corruptionwatch/2002> 

215 Larissa G. Titarenko, “The Walls That Have Yet to Fall: Belarus as a Mirror of CIS Transition,” 

Demokratizatsiya, 8, no. 2 (Spring 2000): 232-33. 
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Belarus is an important country of origin and transit of women and children for sexual 

exploitation to Russia, Ukraine, Lithuania, Germany, Israel, Poland, the Czech Republic, Turkey, 

Cyprus, Greece, Hungary, and Yugoslavia. Russian mafia groups have been especially active in 

trafficking Belarusian women.216 Although the criminal code of 2001 criminalizes trafficking 

and sexual exploitation, the Belarusian judiciary has prosecuted few cases under that law. Law 

enforcement agencies receive no specific training in trafficking, and corruption has blocked 

criminal investigations. Border controls do not effectively prevent trafficking into neighboring 

countries, and cultural biases reduce the chances of a female victim receiving a fair hearing.217

Belarus is susceptible to Russian organized crime activities because of its geographical 

position adjacent to northwestern Russia (an area where criminal activity is concentrated), 

because bilateral agreements with Russia call for lax border security, and because of domestic 

institutional failure. In 1998 Chechen organized crime groups appeared in Belarus as large 

numbers of refugees arrived from Chechnya, many of them illegally. Those groups have been 

implicated in east-to-west narcotics trafficking through Belarus. In rivalries between Chechen 

and Slavic crime groups within Belarus, the Chechens have had the advantage because of greater 

ethnic cohesion. Chechens who arrived in Belarus after the 1996 armistice between the Republic 

of Chechnya and Russia tended away from “ordinary” crime such as narcotics trafficking and 

toward businesses with legal fronts. Chechens have been involved in laundering profits from 

illegal activities in Belarus and sending the money to Chechnya or to European banks.218

Since the mid-1990s, close ties with Russia have made Belarus a major exporter of illegal 

arms, although Belarus has almost no domestic arms industry. Large amounts of those exports 

are believed to have reached forbidden customers such as Iraq, Iran, the Pakistani armed forces 

in Kashmir, and terrorist bases in Sudan. Experts believe that Belarus exhausted its supply of 

Soviet-era military supplies in 1997, after which time it has used more modern weapons from 

Russia to maintain its arms export activity. Illegal export deals apparently proliferate because 

they have the approval of the Belarusian government. For the Russian arms industry, Belarus is a 

 

216 International League for Human Rights, “Belarus Update,” 2, no. 42 (October 2001). <http://www.ilhr.org> 217 U.S. Department of State, Trafficking in Persons Report 2002. 218 Sergey Anisko, “Belarusian Chechens Display Patriotism: Local Power Departments Claim That Chechen 

Mafiya Sends Half the Money It Earns to the Homeland,” Segodnya [Moscow], 12 January 1998, 7 (FBIS 

Document FTS19980113001126). 
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convenient and willing intermediary for products to reach wealthy but “politically incorrect” 

customers.219

Official corruption has been an ongoing problem in Belarus. A 1999 European Study on 

Values identified Belarusians as the Europeans most tolerant of corruption.220 Although the lack 

of market reforms has minimized privatization-related economic corruption, bribery of 

government officials is a regular occurrence. The agencies most often bribed are the customs 

service, border patrol, road and tax inspectorates, and providers of official documents and 

licenses.221

The Caucasus Republics 

Because of its geographic position between the major narcotics producing region of the 

Golden Crescent (Afghanistan and Pakistan) and the major narcotics markets in Russia and 

Europe, the Caucasus region has become an important narcotics corridor. Georgia’s location on 

the southern border of the Russian Federation’s insurgent Republic of Chechnya-Ichkeria has 

made Georgia’s northern territory a base for Chechen rebel forces, estimates of whose size have 

varied widely. An additional factor is the weakness of post-Soviet law enforcement agencies in 

Armenia, Azerbaijan, and Georgia. Armenia, slightly to the southwest of the main narcotics 

routes, has had the least exposure to narcotics traffic. However, Azerbaijan’s southern neighbor, 

Iran, has established an effective anti-trafficking regime that has pushed narcotics routes 

northward into Azerbaijan, where corruption has invited such activity. Georgia, which is 

experiencing a collapse of law enforcement, the Chechen civil war on its northern border, an 

alarming rate of official corruption, and effective loss of control of large sectors of its national 

territory to separatist movements, has provided traffickers the most favorable conditions of the 

three countries. Armenian and Azerbaijani officials have warned that narcotics activity will 

increase significantly in their countries if effective interdiction measures are not taken. 

 

219 Natalya Khmelik, “Military Bookends,” Sovershenno Sekretno [Moscow], 1 August 2002 (FBIS Document 

CEP20020813000393). 

220 “Government Publishes Report on Widespread Corruption in Slovakia,” TASR [Bratislava], 8 September 2002 

(FBIS Document EUP20020908000132). 

221 International League for Human Rights, “Belarus Update.” 
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Armenia

The U.S. Department of State has identified Armenia as a source country for the 

trafficking of women for sexual exploitation to Germany, Greece, Russia, Turkey, and the 

United Arab Emirates. Armenia has no specific law against such trafficking and, according to the 

Department of State report, “is not making significant efforts” to eliminate trafficking.222 Despite 

the country’s location along the traditional narcotics route from Asia to Europe and poor funding 

for anti-narcotics enforcement personnel, narcotics trafficking through Armenia has been 

minimized by the closure of borders with Azerbaijan and Turkey as a result of the NagornoKarabakh conflict. Most of the drugs that enter the country come instead through Georgia.223

A 2002 public opinion poll sponsored by the Organization for Security and Cooperation 

in Europe (OSCE) showed that more than 90 percent of Armenians believe that corruption is a 

serious problem, and that most people identify the government as the main source. Poor law 

enforcement and insufficient legislation and regulations were the proximate causes most 

frequently cited.224 In 2002 the Armenian Center for National and International Studies noted 

that the current culture of government service in Armenia places a higher priority on personal 

gain than on public service, and that Armenia’s civic culture does not encourage public criticism 

of unethical conduct.225 Regional expert Richard Giragosian finds a source of corruption in the 

political environment, noting of President Robert Kocharian, “... his [Kocharian’s] reliance on 

the backing of the country’s oligarchs has hindered any real crackdown on corruption, a longoverdue move essential to Armenia’s stability and security.”226 Bribery of officials is a common 

device used to circumvent Armenia’s complex bureaucracy in routine matters such as licensing 

and pensions.227

 

222 “U.S. Department of State’s Human-Trafficking Report,” RFE/RL Crime and Corruption Watch, 2, no. 23 (14 

June 2002). <http://www.rferl.org/corruptionwatch> 

223 Avet Demurian, “Armenia Escapes Drugs Epidemic,” Institute for War and Peace Reporting, Caucasus 

Reporting Service, no. 130 (23 May 2002). <http://www.iwpr.net> 224 “OSCE Assists in Public Opinion Survey on Corruption in Armenia,” OSCE press release, 4 October 2002. 

<http://www.osce.org> 

225 Armenian Center for National and International Studies, “ACNIS Roundtable on Anti-Corruption Strategies,” 27 

September 2002. <http://www.acnis.am> 

226 Richard Giragosian, “A Troubling Trend in Armenia,” RFE/RL Newsline, 7, no. 3 (7 January 2003). 227 “Armenian Anticorruption Drive Creates Doubt,” RFE/RL Crime and Corruption Watch, 2, no. 30 (30 August 

2002). 
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Azerbaijan

Narcotics trafficking has been a controversial topic between Armenia and Azerbaijan, 

whose struggle for control of the Armenian enclave of Nagorno-Karabakh remains unsettled. 

Azerbaijan, which has suffered significant increases in narcotics traffic and domestic addiction in 

recent years, has accused Armenia of fostering traffic into Azerbaijan from Iran via the 90-mile 

section of the Azerbaijan-Iran border that Armenia occupies.228 In any case, the long struggle 

over Nagorno-Karabakh has impeded law enforcement over a wide area of Azerbaijan. The 

conflict also has created hundreds of thousands of refugees, mainly Azeris. Such groups are easy 

targets for human trafficking, and the diaspora groups that they form provide shelter for 

transnational criminal activity. 

Azerbaijan has significant institutional weaknesses that promote transnational crime. 

Transparency International’s 2002 Corruption Perceptions Index placed Azerbaijan 95th out of 

102 countries surveyed for public perceptions of government and business corruption.229 The 

organization’s 1999 survey had placed Azerbaijan fourth-worst. According to a 2002 study, 59 

percent of foreign investors feel that bribes are necessary to sidestep Azerbaijan’s complex legal 

system.230

According to the International Organization for Migration (IOM), Azerbaijan does not 

have sufficient legislation to combat trafficking, and the institutional capacity for detection and 

prevention of trafficking is insufficient.231 According to a 2002 IOM study, trafficking in persons 

(especially women) is facilitated by poverty, unemployment and gender inequality in 

Azerbaijan.232 Most women smuggled from Azerbaijan have gone to Turkey and the United Arab 

Emirates.233

 

228 R. Nadiroglu, “Bin Laden’s Ties to Armenians Are Much More Extensive than It Appears,” Internet report of 

Zerkalo [Baku], 6 December 2001 (FBIS Document CEP20011206000417). 229 Transparency International. 230 A. Rasidoglu, “Corruption Has Taken on a Menacing Character,” Zerkalo [Baku], 22 June 2002 (FBIS Document 

CEP20020710000409). 

231 International Organization for Migration, “Azerbaijan: Trafficking in Women,” IOM Press Briefing Notes, 15 

March 2002. <http://www.iom.int> 

232 International Organization for Migration, “Azerbaijan: New Study on Human Trafficking,” IOM Press Briefing, 

4 October 2002. <http://www.iom.int> 

233 “Azerbaijani Women Mainly Trafficked to Turkey, United Arab Emirates,” Trend News Agency [Baku] report, 

14 June 2002 (FBIS Document CEP20020614000274).
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Georgia

In 2000 Georgian legal expert Georgi Glonti wrote, “The drug business is very 

widespread in Georgia today....Ethnic groups from Abkhazia, South Ossetia, Chechnya, 

Azerbaijan, and people from other CIS countries as well as Turkey are involved in the drug 

business. Considering Georgia’s location, many countries are using it as a corridor, especially the 

regions with weak government control.”234 According to a report in April 2002, the value of 

drugs trafficked in Georgia has reached $US1 billion per year, a sharp increase from previous 

years.235 In 2002, by its own admission, the government of Georgia had not been able to deal 

effectively with such growth. An important center of narcotics activity has been the Pankisi 

Gorge, a remote area along Georgia’s northern border with Russia. Competition for the region’s 

brisk narcotics trade increased with the arrival of Chechen rebels under the command of Ruslan 

Gelayev, who by 2002 reportedly had used contacts with Georgian authorities to take over the 

trade from local drug barons.236 Gelayev’s enterprise appears to have enjoyed at least passive 

cooperation from Georgian authorities, who have been only an intermittent presence in the 

Pankisi region. 

The complexity of controlling trafficking from Georgia into Russia is increased by 

conditions on the Russian side of the border. Although Russia has augmented border personnel 

in selected portions of its Caucasus border, most of the border remains porous because the 

ongoing impoverishment of Russia’s military forces and the destructive effect of the Chechnya 

conflict on military morale make the bribes of drug traffickers an irresistible temptation. 

Georgia also has been beset by corruption, some of which the republic inherited from the 

Soviet era. On that subject, Gia Nodia, head of the Caucasian Institute for Peace, Democracy, 

and Development, has said: “...in this country corruption is the norm. Corruption is the 

foundation on which public management and economic relations are built.”237 In 2000, a 

presidential report described illegal lobbying groups in all three branches of government and 

 

234 Georgi Glonti, “Problems Associated with Organized Crime in Georgia,” report for the Institute of Legal Reform 

[Tbilisi], 2000. 

235 Moscow Interfax report from Tbilisi, 22 April 2002 (FBIS Document CEP2002042000161). 236 Timofey Borisov, “Has Gelayev Got His Eye on the Chechen Leadership? But Before That, He Tried Out the 

Route to Ichkeria via Dagestan,” Rossiyskaya Gazeta [Moscow], 15 May 2002 (FBIS Document 

CEP20020515000283). 

237 Jean-Christophe Peuch, “Georgia: Corruption Seen as the ‘Norm,’” Radio Free Europe/Radio Liberty report, 10 

May 2001. <http://www.rferl.org> 
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“’criminal overlapping interests’ in the public and private sectors.” The report depicted massive 

corruption in a pyramid that included all levels of public and private endeavor, with huge sums 

of money changing hands at the top level. Many of President Eduard Shevardnadze’s friends 

allegedly have profited from corruption at that level. Despite universal recognition of the 

problem, the national government has done very little to control corruption in Georgia.238

The Central Asian Republics 

This large, sparsely populated region of the former Soviet Union has provided favorable 

conditions for terrorist bases and intense narcotics trafficking. Those activities, which in some 

cases are conducted by the same organizations, have been facilitated by the poor border control 

that is a legacy of Soviet rule. Especially in the Fergana Valley, which is by far Central Asia’s 

most densely populated region, the complexities of Soviet-established national boundaries make 

border control extremely difficult for states with limited financial and human resources. Only 

one of the five—Uzbekistan—has successfully implemented strong border controls, mainly as a 

protection against terrorist incursions of the Islamic Movement of Uzbekistan (IMU) such as 

occurred in Uzbekistan in 1999 and 2000. Uzbekistan undertook such measures in part as a 

response to the poor border controls exercised by all of its neighbor states.239 Because the IMU 

has been an important narcotics trafficking agency in the region, effective border and visa 

controls also have reduced Uzbekistan’s flow of narcotics. However, poor controls and official 

corruption in Kyrgyzstan and Tajikistan have had the effect of pushing the IMU and narcotics 

trafficking in general from Uzbekistan into those countries. Uzbekistan has accused its neighbors 

of harboring IMU groups and threatening Uzbekistan’s well being by failing to reinforce mutual 

borders. 

The IMU was a major regional terrorist and narcotics-trafficking presence until it 

sustained major losses in the Afghan conflict of late 2001. Although the IMU’s size and 

capabilities have been the subject of speculation since that time, in 2002 intelligence reports 

 

238 Zaza Namoradze, Goka Gabashvili, and George Papuashvili, “Georgia Appeals to Public to Help Fight 

Corruption,” Open Society News, Spring 2001. <http://www.soros.org/open_society_news> 239 Zamira Eshanova, “Central Asia: Border Issues an 80-Year-Old Headache for Region,” Turkistan Newsletter, 20 

October 2002. 
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indicated significant resumption of its recruiting activity in the Fergana Valley.240 Such activity 

would again take advantage of poor border controls and international border disputes in the 

Fergana region, especially in Kyrgyzstan and Tajikistan, for narcotics trafficking and possible 

terrorist attacks. The poverty-stricken condition of the populations of those countries has eased 

recruitment and establishment of cells for the IMU and Hizb-ut-Tahrir, a larger but less violent 

radical Islamic group in the region. According to reports in 2003, at least some parts of the 

disparate Hizb-ut-Tahrir organization were rejecting non-violent tactics in response to severe 

repression by the regime of Uzbekistan’s President Islam Karimov.241

Experts believe that in recent years trafficking in human beings has increased 

significantly throughout Central Asia. Although no statistics are available and Central Asian 

governments have recognized the problem only recently, the IOM estimates that several 

thousand women from the five former Soviet republics of Central Asia have been sold into the 

sex trade by transnational traffickers. Because Central Asian cultures reject women suspected of 

prostitution, victims often are not able to return home. Although all five countries have laws 

against human trafficking, sophisticated transnational groups have been able to stymie local law 

enforcement authorities.242

Kazakhstan

Although Kazakhstan has not been a base for Central Asian terrorists, it has been a major 

transit country for narcotics trafficking from Afghanistan to Russia and thence into Western 

Europe. The northern Kazakh cities of Pavlodar and Kustanay, close to the Russian border, are 

the most frequent transit points into Russia. Russian customs authorities have identified the 

Kazakhstan-Russia border as the source of 80 percent of the heroin, 70 percent of the opium, and 

60 percent of the marijuana reaching Russia.243 Such transnational trafficking is promoted by 

pervasive corruption in Kazakhstan’s poorly paid law enforcement agencies. Police often 

 

240 “Banned Islamic Movement Still a ‘Real Threat’ to Uzbek Security—Kazakh Paper,” BBC Monitoring Central 

Asia Unit; based on report in Karavan [Almaty], 1 March 2002; and Artie McConnell, “Islamic Radicals Regroup in 

Central Asia, 15 May 2002, online report of Eurasia Insight. <http://eurasianet.org> 241 For example, see Peter Baker, “Renewed Militancy Seen in Uzbekistan,” Washington Post, 27 September 2003. 242 “Central Asia: Governments Slowly Changing Approach to Human Trafficking,” Eurasianet report, 6 July 2003. 

<http://www.eurasianet.org/departments/rights/articles/eav070603.shtm> 243 “Major Busts Made by Hungarians, Russians, Romanians,” RFE/RL Crime and Corruption Watch, 2, no. 35 (4 

October 2002). <http://www.rfe.rl.org/corruptionwatch> 
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demand bribes of narcotics dealers who have been apprehended; dealers who identify wealthy 

colleagues to the police receive a share of the bribe. Upon payment, the dealer and his drugs are 

released. Because such practices were well established even in the Soviet era, Kazakhstan 

society shows strong cynicism toward law enforcement.244 The highest echelons of the Kazakh 

government may have shown a poor example. In mid-2002, close relatives and associates of 

President Nursultan Nazarbayev were implicated in an international scheme to launder money 

received from foreign companies to promote business in Kazakhstan. The participants allegedly 

used a Swiss bank account for this purpose.245

Kazakhstan, which was a nuclear weapons site in the Soviet era, also may have been 

involved in the theft and smuggling of osmium-187, a radioactive substance that is not used in 

making nuclear weapons. In the last three years, several reports have named Kazakhstan as the 

source of smuggled osmium-187, possibly en route to terrorist organizations or Iraq. In 

December 2001, Moscow authorities arrested a group of Chechens from Kazakhstan, who had 

osmium-187 in their possession.246 Such reports indicate that Kazakhstan has exercised lax 

security for sensitive materials and porous border controls. As of mid-2002, Kazakhstan still was 

negotiating with the United States about removing the weapons-grade nuclear material remaining 

in the country.247 

Kyrgyzstan

Among the five Central Asian republics of the former Soviet Union, Kyrgyzstan has the 

poorest resource base and the weakest overall economy. In 1999 the country nearly went 

bankrupt because of a loss of foreign currency.248 Kyrgyzstan has become a major narcotics 

transit country because its weak economy cannot support competent military and border guard 

units. The political system still is dominated and fragmented by a regional clan system, which in 

the first decade of independence persistently threatened to divide the country into two parts, and 

 

244 Daur Dosybiev, “Kazakhstan: Police Corruption Worsens,” Institute for War and Peace Reporting, Report on 

Central Asia, no. 128 (5 July 2002). <http://www.iwpr.net> 245 Viktor Antichenko, “The State: It Is I and My Daughter,” Novaya Gazeta [Moscow], 17 June 2002 (FBIS 

Document CEP20020620000337). 

246 Dmitriy Starostin, “Osmium Worries the FSB,” Vremya Novostey [Moscow], 27 September 2002. 

<http://www.nti.org> 

247 Nuclear Threat Initiative, “Kazakhstan Overview,” February 2002. <http://www.nti.org> 248 Steven Blank, “Kyrgyzstan: Strategic Pivot,” Central Asia/Caucasus Analyst, 18 December 2002. 

<http://www.cacianalyst.org> 
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poverty makes younger Kyrgyz very vulnerable to a life of crime, Islamic radicalism, or both. 

Bribes to high government officials have bought protection for trafficking routes from 

neighboring Tajikistan,249 and criminal organizations have taken advantage of chronic unrest in 

the Fergana Valley, a resource-rich, ethnically fragmented region that Kyrgyzstan shares with 

Tajikistan and Uzbekistan. 

Trafficking volume along the Tajikistan-Kyrgyzstan routes also has increased because of 

interdiction in alternative transit countries such as Iran and Uzbekistan. The city of Osh, 

strategically located on the Uzbekistan border in the Fergana Valley, has become a hub of 

narcotics movement. The capital city of Kyrgyzstan, Bishkek, also has experienced rapid growth 

in narcotics trafficking, partly because it lies near the border of Kazakhstan, the next “stop” on 

the narcotics highway from Afghanistan to Russia. As of 2001, Bishkek’s drug control 

department had a staff of only 19 to patrol a city of nearly 1 million. In recent years, optimal 

growing conditions have made domestic marijuana a profitable cash crop for villagers in the 

Issyk-Kul (northeastern) and Osh regions.250

Kyrgyzstan increasingly has been a source country for human trafficking. The 

International Organization for Migration estimated that 4,000 women had been trafficked abroad 

in 1999. This is a large number, considering Kyrgyzstan’s small population, although Kyrgyz 

courts found only four people guilty of such trafficking in 2000. The most frequent destinations 

for illegally trafficked Kyrgyz women have been brothels in Germany, Russia, Turkey, and the 

United Arab Emirates.251 Human trafficking, which is promoted by widespread poverty, has 

followed the same routes as narcotics trafficking through Kyrgyzstan. 

According to Prime Minister Kurmanbek Bakiyev, economic crime in Kyrgyzstan also 

has been growing rapidly in recent years. This condition is promoted by widespread corruption 

in financial and monetary institutions, whose transition to a free market economy has not been 

backed by a comprehensive legal system, effective law enforcement, or protection of the right to 

own property. Under these conditions, Bakiyev estimated that in the year 2000 economic crimes 

 

249 Tamara Makarenko, “Crime, Terror and the Central Asian Drug Trade,” Harvard Asia Quarterly, Summer 2002. 

<http://www.cornellcaspian.com/briefs/25_0207CA_Drugs.pdf> 

250 Sashka Shpakova, “A War Against Drug Trafficking in Kyrgyzstan,” Central Asia/Caucasus Analyst, 25 April 

2001. <http://www.cacianalyst.org> 251 Global March Against Child Labour, “Worst Forms of Child Labour Data: Kyrgyzstan.” 

<http://www.globalmarch.org> 
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inflicted damage amounting to 10 percent of the national budget.252 In December 2002, a report 

by the International Crisis Group noted the growing role of Kyrgyzstan’s police in suppressing 

opposition on behalf of the Akayev government.253 As in Uzbekistan, such perversion of police 

authority has a result similar to that caused by conventional police corruption. Under such 

circumstances, especially when police personnel and resources are very limited at best, the 

detection and apprehension of criminals and terrorists is determined by factors unrelated to the 

public good or national security. 

Tajikistan

The central government of Tajikistan has full control over only a small part of the 

country, around the capital city of Dushanbe. Particularly in the mountainous eastern and 

northwestern sectors of the country, smuggling routes and encampments of the terrorist IMU 

have met only sporadic resistance from Tajik authorities.254 Although experts credit Tajikistan’s 

border forces with substantial improvement in recent years, smuggling statistics have not 

decreased proportionately. Under the best of circumstances, control of borders and inland 

territory is extremely difficult because of mountainous terrain. 

Five years after the end of an extremely destructive civil war, Tajikistan remains one of 

the poorest of the former Soviet states; its political fabric still is based on regional clans and 

warlords, many of whom profit from smuggling operations and owe only nominal fealty to the 

central government. Poor economic prospects and low salaries make citizens and government 

officials susceptible to bribes and direct participation in criminal activity. In a 2002 report, the 

International Crisis Group described Tajikistan’s police and other state security agencies as 

having changed since the Soviet era only to the extent that since 1991 organized crime has 

gained greater influence over those agencies. The report describes growing illegal political and 

economic roles for the police, who reportedly have taken over some sectors of the national 

 

252 “Crime Rate in Kyrgyzstan Impedes Socio-Economic Reforms,” Pravda.ru report, 21 August 2001. 

<http://english.pravda.ru/cis/2001> 

253 Zamira Eshanova, “Central Asia: Report Says Police Have Improved Little since Soviet Era,” Eurasia Insight, 18 

December 2002. <http://www.eurasianet.org> 254 Vladimir Davlatov, “Rakhmonov Warns of Afghan Terror Threat,” Institute for War and Peace Reporting, Report 

on Central Asia, no. 127 (28 June 2002). <http://www.iwpr.net> 
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economy and play a large role in narcotics trafficking. Organized crime and terrorism also are 

promoted by corruption at very high levels of government.255

Because of its chaotic law enforcement situation and its location directly north of a 

primary heroin-producing region of Afghanistan, Tajikistan has become the primary route for 

smuggling narcotics northward and westward to markets in Russia and Western Europe.256

Traffickers of various nationalities reportedly ensure their survival by bribing high government 

officials.257 In the first months of 2003, a resurgence of heroin production in Afghanistan 

doubled the volume of confiscations by Tajik border forces. Although part of that increase is 

attributable to improvements in interdiction practices, the Tajik Drug Control Agency requested 

international assistance to deal with the problem.258 Aside from providing funds to bribe 

officials, domestic profits from the narcotics trade (estimated at US$200 million for 2001) also 

have stimulated a large-scale money-laundering system in Tajikistan, which has had no effective 

laws against such practices.259

Turkmenistan

Although Turkmenistan has remained on the periphery of reports about organized crime 

activity in the former Soviet Union, in 2002 transnational criminal activity in that country 

increased significantly. Turkmenistan occupies a central geographical position between primary 

heroin producer Afghanistan and key narcotics trafficking routes west of the Caspian Sea. 

Intelligence sources have documented the involvement of major Turkmen clans in various types 

of smuggling. Although Turkmenistan is a dictatorship, political power still is based on the 

loyalty of major clans; government indulgence of money-making activities of those groups is an 

effective method of buying such support. Evidence indicates that the government of President 

Saparmyrat Niyazov permits trafficking operations at the country’s main airport at Ashgabat, and 

that major narcotics routes transit Turkmenistan before crossing the Caspian Sea to the 

 

255 Eshanova. 256 U.S. Department of State, International Narcotics Control Strategy Report 2001. 257 Makarenko, “Crime, Terror and the Central Asian Drug Trade.” 258 Mark Berniker, “Tajikistan Strives for Growth amid Risk and Poverty, Eurasianet report, 11 June 2003. 

<http://www.eurasianet.org> 

259 “Arrest Illegal Capital but Grant No Amnesty,” Asia-Plus [Dushanbe], 18 April 2002 (FBIS Document 

CEP20020427000054). 
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Azerbaijani port of Sumgait.260 Because law enforcement officials are poorly paid but exert 

substantial authority, they are susceptible to corruption and are known to solicit bribes even for 

routine traffic stops. The general public’s distrust of the police discourages cooperation.261

Uzbekistan

Uzbekistan is mainly a transit country for narcotics; little domestic production is known. 

Although Uzbekistan has taken strong interdiction action in recent years, administration of its 

anti-narcotics program has been fragmented among three separate agencies: the Ministry of 

Internal Affairs, the National Security Service, and the State Customs Committee. The National 

Center for Drug Control, which nominally coordinates and separates the activities of those 

agencies, has not done so effectively. In addition, none of the three agencies specializes in 

narcotics interdiction, and they all face an acute shortage of resources. Corruption and bribery, 

which are a general problem in Uzbekistan’s law enforcement agencies, have affected narcotics 

operations in some cases.262

A 2002 report by the International Crisis Group identified police brutality as a chronic 

problem in Uzbekistan. Says the report, “....the situation is so bad that it is vital that the 

government does something about changing the culture of police brutality within Uzbekistan.”263

The government of Uzbekistan routinely has used the police to detain and torture a variety of 

individuals deemed dangerous to the state on the pretext of criminal activity. This practice 

undermines public trust and the genuine crime-fighting authority of police agencies. 

Moldova 

Moldova is one of the poorest countries in Europe. Its economy has not responded 

successfully to the economic reforms of the 1990s, leaving a substantial part of the population in 

worse economic condition than it was when Moldova was a Soviet republic. The country’s gross 

national product has shrunk by 60 percent since 1991, prompting extensive emigration. In the 

 

260 Personal communication from Tamara Makarenko, 7 October 2002. 261 U.S. Department of State, International Narcotics Control Strategy Report 2001. 262 U.S. Department of State, International Narcotics Control Strategy Report 2001. 263 Eshanova, “Central Asia: Report Says Police Have Improved Little since Soviet Era.” 
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same period, organized crime groups and official corruption grew rapidly when the Soviet 

collapse made public assets available to well-placed officials and existing mafia groups. 

Corruption has remained endemic throughout the post-Soviet period; in 2002 

Transparency International rated Moldova number 93 out of 102 countries evaluated in the 

organization’s Corruption Perceptions Index.264 Comparison with the number 64 ranking (out of 

91) that Moldova received in 2001 indicates that corruption has increased substantially, in spite 

of the establishment of a Department to Combat Organized Crime and Corruption in the Ministry 

of the Internal Affairs. Police and prison officials reportedly are the most corrupt categories.265

The independence movement of Moldova’s Transnistria region has fragmented law 

enforcement and created a zone of unrestricted smuggling in that region. According to 

international journalist Peter Landesman, “....there might be no place on earth that better 

represents the overlapping interests of governments, organized-crime syndicates and arms 

traffickers....”266 Because Transnistria adjoins Ukraine and has poor customs controls, the 

province is a weak link in the country’s anti-trafficking efforts. The large amounts of arms and 

munitions that remain in the region after its long post-Soviet occupation by Russia’s 14th Army 

are attractive targets for arms dealers.267 In 2002 the Ministry of Defense of Moldova was 

implicated with criminal organizations in a scheme to use smuggled oil to purchase arms in 

Transnistria, then sell the arms to Chechen rebels. According to a newspaper report, in this 

arrangement “....a criminal trade union was practically created under the umbrella of the top 

authorities. It includes gangsters on the one hand and high dignitaries on the other hand.”268

Economic weakness has combined with weak law enforcement to make Moldova a 

primary country of origin for trafficking in women, many of whom see no hope of gainful 

employment in their home country. By 2000, such trafficking had become linked with trafficking 

in illegal arms and narcotics. At that time, trafficking in women was estimated to be one of the 

most profitable forms of organized crime in Moldova. According to the British Helsinki Human 

Rights Group, 60 percent of women active in the European sex trade are from Moldova. From 

 

264 Transparency International 2002. 265 “Human Rights Group Says Corruption, Abuse of Power Still High,” reported in Basapress [Chisinau], 21 May 

2002 (FBIS Document CEP20020521000255). 

266 Peter Landesman, “Arms and the Man,” New York Times Magazine, 17 August 2003, 55. 267 Boris Volkhonsky, “Moldovan President Offers Dniester Region Compromise but Europe Pushes Him Toward 

Tough Stance,” Kommersant [Moscow], 6 February 2002 (FBIS Document CEP20020206000176). 268 “Paper Accuses Communist Authorities of Protecting Oil, Arms Smugglers,” reported in Tara [Chisinau], 13 

June 2002 (FBIS Document CEP20020617000276). 
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Moldova, women usually enter a trafficking network in Romania, where they are “sold” to 

traffickers who move them through Serbia to Bosnia, Kosovo, Albania, Greece, or Italy. 

(Relatively few Moldovan women go to countries in Western Europe, aside from Italy.) Along 

this route, women often come under the control of several trafficking groups.269

The market for Moldovan women in the Kosovo region, which is controlled by Albanian 

crime groups, has grown substantially since the 1999 occupation of that province by NATO and 

United Nations forces stimulated the demand for prostitutes.270 In “competition” with Ukraine, 

Europe’s other major source of women for the sex trade, Moldovan traffickers have the 

advantage of cooperation with their counterparts in neighboring Romania, based on their 

common language. A second advantage is Moldova’s relative proximity to growing markets for 

the sex trade in the Balkans. There also seems to be a social base for the trade: in many cases, 

parents in Moldova have been willing to virtually sell their daughters to traffickers or pimps. 

Despite the prevalence of such trafficking, Moldova’s police have little capability to respond. In 

2001 the vice squad of Chisinau, the capital, consisted of seven men with no cars or special 

equipment.271 A shortage of human organs for transplant operations in Europe and Israel also has 

promoted illegal trafficking in organs, which traffickers purchase for cash from poverty-stricken 

Moldovans.272

Narcotics sales within Moldova have been limited by economic conditions. However, 

narcotics seizures indicate some international traffic through the country. Moldovan traffickers 

are known to be closely connected with dealers in other East European countries. Domestic 

enforcement of narcotics trafficking is limited by a lack of government support funds.273

Russia 

Terrorist activity in Russia has been connected with the ongoing independence movement 

of one of the federation’s republics, Chechnya-Ichkeria, which began in 1992 and has included 

two periods of armed hostilities, 1994-96 and 1999 to the present. Despite cease-fires and 

 

269 British Helsinki Human Rights Group, “Sex Slaves: Trafficking in Human Beings from Moldova to Italy,” 2001 

report. <http://www.bhhrg.org> 

270 British Helsinki Human Rights Group. 271 British Helsinki Human Rights Group. 272 Peter Baker, “In Struggling Moldova, Desperation Drives Decisions,” Washington Post, November 7, 2002, A14. 273 U.S. Department of State, Bureau of International Narcotics and Law Enforcement Affairs. 
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diplomatic negotiations, factions of the Chechen freedom movement continued kidnappings and 

attacks on Chechen and neighboring territory throughout the 1990s and into the following 

decade. In October 2002, Moscow suffered the occupation of a concert hall and the taking of 

several hundred hostages by Chechen insurgents. The government attributed earlier detonations 

in apartment buildings in Moscow and elsewhere to Chechen rebels, although the allegations 

never received independent confirmation. In their second war against Russia, which began in 

1999, Chechen insurgents have had an unknown degree of support from al Qaeda, which 

supplied the cause one major military leader, the Jordanian-Saudi mercenary known as Khattab. 

As the largest of the countries emerging from the collapse of the Soviet empire in 1991, 

as well as the heart of that empire’s economic existence, Russia suffered from many conditions 

promoting organized crime during its first post-Soviet decade. In 2000, Russian domestic policy 

expert Sally Stoecker described the domestic situation thus: 

In the wake of globalization and the weakening of the state, criminal organizations have 

assumed the roles that the state previously played and...have asserted their own form of 

authoritarianism. Not only do these criminal organizations exploit the chaos and high 

unemployment trends in Russia, they actively intimidate the populace in a manner not 

unlike the coercive KGB-informants and operatives of the Soviet era. Criminal 

organizations have penetrated the financial structures and political circles and block 

efforts to foster the growth of civil society in Russia. At the present time, Russia appears 

not only to be penetrated, but also ruled by corrupt officials and financial oligarchs and 

involved in crime and corruption at all levels of society.274

Pervasive crime within Russia also has engendered participation in transnational crime. 

Said regional crime expert Louise Shelley in 2003: 

Post-Soviet organized criminals are now major actors in international organized crime. 

They have acquired the distinction because of the diversity of their activities, the global 

reach of their operations, their links with other organized crime groups, and the sheer 

volume of their activity. Their involvement in weapons trade internationally and in 

massive money laundering has made them threats to national security on a regional and 

international level.275

 

274 Sally Stoecker, “The Rise in Human Trafficking and the Role of Organized Crime,” Demokratizatsiya, 8, no. 1 

(Winter 2000): 130. 

275 Louise I. Shelley, “Crime and Corruption: Enduring Problems of Post-Soviet Development,” Demokratizatsiya, 

11, no. 1 (Winter 2003): 113. 
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The roots of such a condition extend back into and prior to the Soviet period. Soviet rule 

reshaped a long history of corrupt bureaucracy into its present form, in which specific groups of 

well-placed people benefit from links with government officials. Although Russia has 

experienced an economic upturn since Stoecker’s words were written, the fundamental 

conditions have remained essentially unchanged. In the 1990s, criminal organizations took 

advantage of the availability of large state industrial enterprises to gain strong connections in 

critical industries such as aluminum and oil. Such a presence has assured those organizations of 

ongoing political leverage.276

Russia’s organized criminal organizations evolved in the 1990s after the “thieves in law,” 

as the founders of the Soviet-era black markets were called, adapted successfully to the postSoviet collapse of law enforcement in Russia. The thieves in law have been traditional, tightly 

organized groups with territorial definition, although they are not based on ethnic or family 

structures as are equivalent groups in Italy and Albania.277 In the late 1990s, such groups 

gradually were replaced by a younger generation referred to as the “authorities,” whose 

legitimate outer surfaces are more compatible with the new tone of globalization. An important 

domestic condition for the growth of such groups is the inefficiency of Russian courts in 

arbitrating legitimate financial disputes. Instead of waiting for a court decision, many Russian 

businesses have turned to “security firms” controlled by organized crime.278

The new groups have given a more fragmented and pragmatic quality to organized crime, 

although territorial battles still occur. According to one estimate, between 1992 and 2002 the 

number of criminal groups in Russia tripled to 12,000. The “authorities” are much more willing 

to further their interests by establishing cooperative agreements with other domestic or foreign 

criminal organizations, and they move comfortably between the criminal world and the world of 

legitimate business.279 This policy has reduced territorial battles with equivalent groups in 

Eastern Europe and other republics of the former Soviet Union while establishing international 

contacts that diversify Russian activity. 

 

276 Henry Meyer, “Russian Mafia Extends Tentacles Across the Globe,” Agence France Press report, 15 August 

2002. 

277 James O. Finckenauer and Yuri A. Voronin, The Threat of Russian Organized Crime (Washington, D.C.: U.S. 

Department of Justice, 2001), 4. 

278 Finckenauer and Voronin, 22. 279 “The End of the Vory?” Jane’s Intelligence Review, 1 March 2002; and Walter Zalisko, “Russian Organized 

Crime: The Foundation for Trafficking.” <http://www.monmouth.com> 
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High levels of corruption in both civil and military sectors of Russia’s government have 

caused serious concern about the security of the country’s still formidable array of nuclear 

weapons and materials. Authorities have uncovered many incidents of conventional arms and 

technology sales by high military officials. The Russian military has been a fertile recruiting 

ground for organized crime groups requiring individuals familiar with weapons and security 

procedures.280

Nuclear security remains primarily the responsibility of a military force in which onerous 

duty conditions and low pay have constantly increased fragmentation, corruption, and 

incompetence. Antiquated security procedures complicate effective monitoring at nuclear storage 

facilities. Most known incidents of theft of nuclear materials have involved Russian security 

personnel.281 In 1998 Department of State official Robert Gallucci described the threat posed by 

such a situation thus: “Russian mobsters would find a ready market for any stolen radioactive 

materials in Iraq, Iran and Libya, all of which are shopping for nuclear weapon components and 

maintain ties to terrorist groups.”282 In mid-2002, Russia’s Federal Security Service reported 

increasingly frequent attempts by criminals to sell nuclear and chemical weapons components in 

Russia and in other countries of the former Soviet Union.283 In October 2002, authorities in East 

Siberia stopped the alleged smuggling of 27 tons of enriched uranium out of Russia.284

Several areas of Russia have become centers of organized crime activity. Among the 

most heavily affected are St. Petersburg in the northwest, Yekaterinburg and Sverdlovsk in the 

Urals, and several population centers of the Far East. Because of the proximity of Western 

Europe and the existence of trafficking routes before 1991, Russia’s northwest saw a heavy 

concentration of criminal groups in the early post-Soviet years, and St. Petersburg became 

known as Russia’s “crime capital.” The government of Vladimir Putin, who is a native of St. 

Petersburg, has attempted to reduce the role of the city as a hub of trafficking and violent crime. 

 

280 Todd H. Nelson, “Russian Realities: Nuclear Weapons, Bureaucratic Maneuvers, and Organized Crime,” 

Demokratizatsiya, 8, no. 1 (Winter 2000): 146-47. 281 Nelson, 148. 282 Mark Johnson, “Nukes and the Russian Mob,” Journal of Commerce, 13 (March 1998), 6, quoted in Todd H. 

Nelson, “Russian Realities: Nuclear Weapons, Bureaucratic Maneuvers, and Organized Crime,” Demokratizatsiya, 

8, no. 1 (Winter 2000): 147. 

283 Dmitriy Staroshin, “Osmium Worries FSB,” Internet version of report from Vremya Novostey [Moscow], 27 

September 2002 (FBIS Document CEP20020927000315). 

284 “Russian Customs Officials Seize over 27 Tonnes of Enriched Uranium,” TVS [Moscow] report, 8 October 2002. 
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In recent years, organized crime has grown especially fast in the Far East of Russia, in 

large part because that region is politically and geographically remote from the center of national 

authority in Moscow. The increasing presence of Chinese and Japanese immigrants also has 

established connections between organized crime groups in the Orient and Russian groups in the 

Far East. In recent years, various combinations of Russian and Oriental gangs have opened a 

wide variety of trafficking and smuggling operations through the porous controls of eastern cities 

such as Vladivostok and Kharbarovsk. Fish, narcotics, stolen cars, and prostitutes are among the 

most lucrative categories. Organized crime groups have gained a strong foothold in municipal 

law enforcement and judicial agencies, stymieing the investigations of federal authorities.285

The industrial cities of the Urals also are a region of intense criminal activity. In the late 

1990s, new groups in the Urals who engaged in economic types of crime merged with more 

traditional groups who still held significant power in the region. The resulting groups, included 

in what is called the Uralmash network, focus on global investment, the export of strategic raw 

materials (occasionally including radioactive materials) and arms, and buying real estate for 

money-laundering purposes. Uralmash also is firmly entrenched in legitimate business as coowner of the Urals Commodity and Raw Materials Exchange and an estimated 140 commercial 

enterprises, including banking and financial institutions. Two major rival groups hold territory in 

the Sverdlovsk-Yekaterinburg area. In partnership with Western groups engaged in economic 

crime, Uralmash now has connections in Belgium, Cyprus, Hungary, the Netherlands, and the 

United Arab Emirates.286

Russia’s border guard force and migration authorities, like its military, are vulnerable to 

corruption because of extremely low pay and poor working conditions. A number of regional 

offices of the Federal Migration Service (FMS), which controls the passage of migrants into 

Russia, have shown the effects of recent budget reductions. In 2001, the service’s average 

monthly salary was US$36. Bribery and other misuse of authority have arisen in many such 

offices. Such behavior has been encouraged by the most recent Criminal Code of the Russian 

Federation (1996), which abolished imprisonment as a penalty for taking bribes.287 Nikolay 

 

285 Yana Aminyeva and Viktoria Chernysheva, “Organized Crime in the Far East: Press Survey for the Maritime 

Province, January 2000,” Organized Crime and Corruption Watch, Summer 2000, 28-30. 286 Finckenauer and Voronin, 14-15. 287 Fyodor Sinitsyn, “Corruption in the Federal Migration Service of Russia,” Organized Crime and Corruption 

Watch, 3, no. 1 (Spring/Summer 2001): 15-19. 
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Kovalev, chairman of the State Duma Commission for Combating Corruption, offered a cultural 

explanation for the prevalence of bribe-taking by Russian authorities: “... in Russia in almost all 

cases there is no extortion, for there is no need for it: people voluntarily offer bribes. Therefore, 

on the one hand society complains, but on the other hand it provokes corruption and does not 

want to fight it. It is both an ailment of our society and its diagnosis.”288

Among smuggling operations involving Russian cooperation with international criminal 

groups, compact discs and women are two of the fastest-growing categories. In mid-2002 United 

States authorities identified “massive CD pirating,” some of which allegedly takes place in plants 

owned by Russia’s military-industrial complex. Another plant allegedly participating in CD 

piracy was owned in 2002 by a company whose director, Oleg Gordyiko, at the same time also 

headed the Russian Chamber of Commerce’s commission on intellectual property rights.289

Under the control of organized crime groups, Russia also has become an important country of 

origin for the trafficking of women for sexual exploitation to Western Europe, the Middle East, 

and North America. Russia has no law specifically criminalizing trafficking; recruitment for 

prostitution is not a felony, and the early age of legal consent (14) makes prosecution difficult. 

Russia has prosecuted very few individuals for trafficking in persons.290

The incidence of currency and credit-card counterfeiting in Russia has increased sharply 

in recent years. In 2002 authorities reported a 50 percent increase in the counterfeiting of largedenomination United States and Russian currency; no counterfeit European currency (euros) had 

been identified as of August 2002. Chechen militants have been identified as primary 

distributors. Prosecution of alleged counterfeiters is difficult because Russia’s law requires 

identification of counterfeit currency in circulation prior to an arrest.291

Ukraine 

In 1998 regional crime expert Louise Shelley wrote, “The most pernicious element of the 

crime phenomenon in Ukraine is the criminal-political axis, the alliance among former Party 

 

288 Quoted in “’Overindulgence in Bribery,’” RFE/RL Crime and Corruption Watch, 2, no. 27 (July 25, 2002). 

<http://www.rferl.org/corruptionwatch/2002> 

289 “...And U.S. Ambassador in Moscow Calls for End to CD Piracy,” RFE/RL Newsline, 1 August 2002. 

<http://www.rferl.org/newsline/2002/08/1-RUS/rus-010802.asp> 

290 U.S. Department of State, Trafficking in Persons Report 2002. 291 “Russian Counterfeiting on the Rise,” RFE/RL Crime and Corruption Watch, 2, no. 28 (8 August 2002). 

<http://www.rferl.org/corruptionwatch> 
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elite, members of the law enforcement and security apparatuses, and gangs of organized 

criminals. Much crime in Ukraine combines government officials’ access to information or 

goods with the use or threat of force by organized criminals.” More recent sources indicate that 

in 2002 these conditions still shape fundamentally the nature of criminal activity in Ukraine. In 

2003 Jonathon Winer, a former deputy assistant secretary of state for international law 

enforcement, summarized the situation in Ukraine: “There’s concentrated power, resources in 

very few hands, no oversight, no separate functioning judiciary, a huge porous border, huge 

inherited military facilities, lots of airstrips, a bunch of old planes. Ukraine is the epicenter for 

global badness....It’s a one-stop shopping infrastructure for anyone who wants to buy 

anything.”292

According to 1997 figures from the Ministry of Interior, only 3 percent of the criminal 

groups in Ukraine had international connections at that time. However, those groups, called 

soobshchestva (sg. soobshchestvo), have a broad base that includes former communist party 

officials, members of law enforcement and security agencies, and organized criminals. Such 

groups infiltrate legitimate industries and enterprises, and they stay ahead of law enforcement 

agencies by methodically updating their technological capabilities. They also cultivate 

relationships with the international criminal community. Although individual groups often 

specialize in a single criminal activity, as a whole the soobshchestva cover a wide variety of 

smuggling activities, vehicle theft, counterfeiting, money laundering, and the sex trade. Their 

international activities have been identified in nearly all countries of Western and Eastern 

Europe, the United States, Canada, and some republics of the former Soviet Union, with links to 

the indigenous organized crime groups in most of those countries.293

In the post-Soviet era, arms trafficking groups have taken advantage of two 

circumstances: the large and varied stock of military equipment left in Ukraine when Soviet 

forces withdrew and the disappearance of controlling military authority that resulted from the 

Soviet Union’s collapse. In the 1990s, an estimated one-third of that stock was stolen and re-sold 

abroad. Arms originating in Ukraine have appeared in international conflict areas such as 

Angola, Bosnia, Liberia, Peru, Rwanda, Sierra Leone, and Sri Lanka. Some of Ukraine’s legal 

 

292 Landesman, 31. 293 Tamara Makarenko, “Ukrainian Mafia Moves into the International Crime Arena,” Jane’s Intelligence Review, 1 

February, 2002. <http://web.osis.com> 
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arms exports to Pakistan are believed to have reached the Taliban in Afghanistan. Such a volume 

could not have been achieved without active participation by the national customs and security 

services and other government agencies. In 2001 a former mayor of the port city of Odessa said, 

“The [Ukrainian] arms business is totally criminalized. Here you will find the business interests 

of a number of institutions coming together.”294

In October 2002, a United States and British fact-finding team reported on the possible 

sale of a radar aircraft detection system to Iraq and on the status of the Ukrainian arms export 

system in general. The poor cooperation that the team received from the Ukrainian arms 

manufacturing and marketing system led to the conclusion that “illegal arms transfers, 

particularly with the complicity of third parties, remain a credible possibility.”295

Large-scale narcotics trafficking is a relatively new activity of the soobshchestva. Its 

development coincided with the expansion of the “Northern Route” that carries narcotics from 

Afghanistan through Central Asia and the Caucasus to Russia and Western Europe. Ukrainian 

groups have used their ties with Russian and Central Asian groups to make Ukraine a major 

transit country from east to west. In turn, the increased domestic demand for narcotics has 

promoted the growth of local groups catering to individual customers. 

Smuggling of persons—both for the sex trade and for illegal immigration–also is a major 

activity with international implications. The declining economic conditions of the 1990s made 

Ukraine a major supplier of women for an international sex trade that extended from the 

Mediterranean to the Far East. Traffickers have delivered as many as 500,000 Ukrainian women 

to the sex industries of Greece, the Netherlands, and Turkey. In September 2001, Ukraine for the 

first time criminalized human trafficking, pornography, and sexual exploitation. The government 

also has formed anti-trafficking units at the national and regional level.296 However, shortages of 

resources and ongoing corruption may block effective interdiction. 

The smuggling of migrants by Ukrainian groups has depended on links with organized 

crime in China, Pakistan, Russia, and Sri Lanka. International authorities believe that Ukraine is 

a transit area for this form of smuggling as well. According to an unconfirmed report, as many as 

 

294 Makarenko, “Ukrainian Mafia Moves into the International Crime Arena.” 295 Australia, Ministry for Defence, “Report of the Experts Team Visit to Ukraine,” 28 November 2002. 296 “U.S. Department of State’s Human-Trafficking Report,” RFE/RL Crime and Corruption Watch, 2, no. 23. 

<http://www.rferl.org/corruptionwatch> 
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200 al Qaeda fighters may have been moved from Afghanistan to Ukraine by Pakistani 

smugglers who had ties in Ukraine.297

The unregulated commercial conditions of the 1990s also permitted Ukrainian criminal 

groups to penetrate the national financial infrastructure. Direct control of banks has provided the 

means for large-scale money laundering and the information necessary to engage in extortion 

rackets. In addition to banks, casinos, hotels, and exchange bureaus have become sites for regular 

money-laundering operations. Meanwhile, penetration of legal businesses has cemented the link 

of criminal and business groups and expanded the foundation of illegal financial operations. 

According to Ukrainian security authorities, organized crime has penetrated financial and credit 

systems, production markets, the energy industry, and the agro-industrial business. For these 

reasons, Ukraine has gained an international reputation as a hospitable location to launder illegal 

funds. In 2001 an international investigation requested that the Ukrainian National Bank close 20 

accounts suspected of having terrorist connections. This request has met resistance because 

Ukrainian authorities fear the commercial repercussions of such a breach of bank secrecy.298

Like other countries of the former Soviet Union, during the past decade Ukraine has 

responded to international pressure with a variety of laws, decrees, committees, and resolutions 

dedicated to reducing corruption and organized crime. However, organizations such as the 

national government’s Coordinating Committee to Struggle Against Corruption and Organized 

Crime (in operation since 1993) have been used mainly against small-scale offenders and 

political dissidents. Such organizations also have been the subject of political rivalries: in 1999 

Parliament eliminated the Coordinating Committee’s National Bureau of Investigation, and the 

Ministry of Internal Affairs and the Security Service have anticorruption agencies similar to the 

Coordinating Committee.299

An important factor in this lack of success is the continued existence of a very large 

shadow economy, where commercial and financial activities are beyond government monitoring. 

Many government officials have second jobs in the shadow economy, where their incomes are 

protected from taxation. Frequent changes of legislation, high taxes, and a complex bureaucracy 

 

297 Makarenko, “Ukrainian Mafia Moves into International Crime Arena.” 298 Makarenko. 299 Taras Kuzio, “Ukraine’s Virtual Struggle Against Corruption and Organized Crime,” RFE/RL Crime and 

Corruption Watch, 2, no. 31 (6 September 2002). <http://www.rferl.org/corruptionwatch> 
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of inspection agencies are additional factors inhibiting effective shrinkage of the shadow 

economy.300

Privatization of state enterprises is another commercial condition that has promoted the 

criminal-political elite to which Louise Shelley referred. In the privatization process, former 

Soviet officials used their ongoing ties to post-Soviet governments to gain powerful economic 

resources. This elite continues to exert power by its control of the media and businesses in 

combination with access to government funds. Such a structure creates an axis of government 

officials, pro-government businessmen, and political parties, in which officials overlook corrupt 

and illegal practices by the other two segments in return for political support.301

The Former Yugoslavia 

The nations that emerged from the collapse of the Socialist Federal Republic of 

Yugoslavia (SFRY) in 1992 have been plagued with crime-promoting conditions that have 

existed in the region since it was part of the Ottoman Empire. Bosnia-Herzegovina, Croatia, 

Macedonia, and the former Yugoslav Republic, now known as Serbia and Montenegro, all have 

societies based on family and clan ties that have resisted the rule of law. Says Balkan expert 

Christopher Corpora, “....a history of authoritarian regimes in the Balkans had led to tight 

informal networks at the grassroots level, some of which had turned to crime, hindering the 

growth of civil society.”302 In this context, organized crime groups have gained protection for a 

wide variety of criminal activities by establishing connections with state security and intelligence 

agencies, forming autonomous power centers that are immune to prosecution and are able to 

control local politicians and manipulate the media.303

The region also has been deprived of peaceful development by a long history of ethnic 

struggle. The most recent chapter of that struggle, in the 1990s, combined with geopolitical 

developments elsewhere in Eurasia to promote especially strong growth of organized criminal 

and terrorist activity and pervasive corruption. Because of its small, homogenous population and 

 

300 Kuzio. 301 Kuzio. 302 Nir Rosen, “Mafia Fuels Balkans Turmoil,” Institute for War and Peace Reporting, Balkan Crisis Report, no. 333 

(26 April 2002). <http://www.iwpr.net> 303 Michael Dziedzic, Laura Rozen, and Phil Williams, “Lawless Rule Versus Rule of Law in the Balkans,” United 

States Institute of Peace Special Report, no. 97 (December 2002), 1. 
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uniquely close ties with Western Europe, Slovenia is the only former republic of the SFRY not to 

be a major launch site for transnational criminal operations. 

Bosnia and Herzegovina 

Ethnic fragmentation among three groups—the Christian Croats and Serbs and the 

Bosnian Muslims—has played a major role in promoting criminal activity in this former republic 

of the SFRY. Historically, that fragmentation has been intensified by the prevalence of informal 

local power structures that have resisted central governance. The most recent manifestation of 

ethnic conflict, a war between the Serbian Bosnians on one side and the Croatian and Muslim 

Bosnians on the other, created new opportunities for criminal organizations and left structural 

problems that have survived the armistice of 1995. During the war the three nationalist parties, 

which “formed the nucleus of Bosnia’s criminalized power structures,”304 funded their political 

and military activities by smuggling and illegal financial transactions. The war profiteering 

activities of officials often crossed ethnic lines, and gray and black markets supplanted legitimate 

economic enterprises. The structures that permitted such activity have not changed substantially 

since 1995. The black market has in fact expanded since the end of the war, Bosnia continues to 

play a vital role in the highly profitable Balkans Route of narcotics trafficking, and the three 

ethnic parties continue to divert profits from state enterprises in the areas they control. According 

to a 2002 report, “Corruption continues to be endemic in the wake of the armed conflict. The 

impact of official connivance in, protection for, and even direction of smuggling and other forms 

of tax evasion is enormous.”305

In the fall of 2002, an arms export scandal exposed a weakness in Bosnia and 

Herzegovina’s arms export controls. The aircraft components firm Orao, which is owned by the 

state in the Serbian Republic of Bosnia-Herzegovina, acknowledged delivery of spare parts for 

fighter aircraft to Iraq, in violation of international sanctions on that country. Two or more other 

Bosnian Serb companies also may have been involved in the transaction, which was overseen by 

the Belgrade-based import-export firm Yugoimport and allegedly brokered by Serbian radical 

nationalist leader Vojislav Šešelj. Bosnia-Herzegovina’s unique two-part state, which combines 

Serbian and Croatian-Muslim entities and has a rotating presidency, creates a division of 

 

304 Dziedzic, Rozen, and Williams, 6. 305 Dziedzic, Rozen, and Williams, 6. 
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authority. In the Orao case, a Bosnian Serb arms company cooperated with a Serbian trading 

company, assumedly with the knowledge of the government of Bosnia’s Serbian Republic. (The 

president of the Serbian Republic, Mirko Šarović, is a former executive in the Orao company.) In 

the wake of the Orao scandal, the government of Bosnia-Herzegovina suspended all arms exports 

until authority for such exports could be transferred from the two constituent republics to the 

central government.306

The breakdown of central authority and border controls also has acted to promote 

trafficking in women, for which Bosnia is mainly a destination country. Other important factors 

in this form of crime are geographic location near primary source countries Romania, Moldova, 

and Ukraine, which account for 95 percent of women in this status, and the absence of laws 

under which the operators of sex establishments can be prosecuted. The trafficking route usually 

leads through Hungary or Serbia. Local police are a major clientele group for the sex trade in 

which these women work; according to one survey, another 10 percent of the women work for 

“international clients,” meaning civilian and military personnel in peacekeeping and diplomatic 

roles. Bribery and the falsification of documents are normal parts of the trafficking operation, in 

which a woman may be bought and sold several times along the route.307 Border police often are 

instrumental in bringing women across the border between Yugoslavia and Bosnia.308 The 

“Arizona” market, in rural Bosnia near the Croatian and Serbian borders, is one of Europe’s 

largest black markets for women and a wide variety of smuggled commodities, including 

compact discs.309 According to one 2002 report, traffickers routinely use Bosnia-Herzegovina’s 

432 “mostly unmanned” crossing points along the extensive mountainous border with Croatia.310

Corruption has weakened border controls and promoted trafficking. Because the 

economy has not improved substantially since the end of fighting in 1995, many Bosnians see 

appointments to official positions as opportunities to gain a profitable income through bribes.311

The customs service of the Serbian Republic of Bosnia-Herzegovina suffered a major scandal in 

 

306 “Bosnia Suspends Military Exports,” VOA News report, 29 October 2002. <http://www.voanews.com> 307 Fredric Larsson, “Trafficking in Women to Bosnia and Herzegovina,” Trafficking in Migrants, Autumn 2000. 308 Andrea Gerlin, “Sex Trafficking Is Flourishing in Balkans,” Philadelphia Inquirer, 15 April 2002. 

<http://www.philly.com/mld/inquirer> 

309 Michael Voss, “’Slave Trade’ Thrives in Bosnia: High Unemployment Makes Women Easy Prey,” University of 

Rhode Island Trafficking in Women from Ukraine Research Project, 8 March 2001. 

<http://www.uri.edu/artsci/wms/hughes/ukraine/slavebosnia> 

310 Ian Burrell, “Sex, Drugs, and Illegal Immigrants: Sarajevo’s Export Trade to Britain,” The Independent

[London], 21 January 2002. <http://www.independent.co.uk> 311 Burrell. 
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mid-2002 when 27 customs officers admitted having extracted an estimated US$15 million in 

bribes from customers. Customs service chief Groan Popover, who also is a senior member of 

the Serbian Democratic Party, was suspected of having masterminded the extortion scheme, 

which allegedly was supervised by his appointee as chief of the anti-smuggling department of the 

customs service.312 This breakdown seemingly is another result of the autonomy of Bosnia’s two 

republics from federal authority. 

Croatia 

In recent years, criminal groups in Croatia have been increasingly active. Based on 

substantial evidence, they have been implicated in a variety of domestic and foreign activities, 

including racketeering, narcotics trafficking, extortion, and international arms smuggling. 

However, numerous recent press reports indicate that Croatian authorities have not pursued such 

groups consistently or completely. The inconclusive results of domestic investigations of arms 

smuggling organizations, most notably the Opal Metals Plant, have been met with media 

accusations of official corruption. Well-publicized exchanges of narcotics and arms, managed by 

Croatian organized crime groups, have received limited responses from Croatian authorities. 

According to a 2001 newspaper report, arms smuggling has been protected by officials in 

Croatia’s ministries of defense and internal affairs, the customs service, the intelligence services, 

and one of Croatia’s main political parties, the Croatian Democratic Union (HDZ). Under such 

protection, says the report, “Croatia has become one of the larger distributors of arms and 

explosives for the European criminal and political underworld.”313

Domestic crime activities also have not been prosecuted fully. Although two major, 

Zagreb-based organizations were known to dominate organized crime in Croatia in the late 

1990s, in 2001-02 the Croatian state has recognized and prosecuted major figures of only one. 

The second, a narcotics-trafficking and racketeering group that Veto Slink ran before his 

assassination in 2001, has escaped prosecution. One explanation is that the state used 

 

312 Dragan Jerinić, “Bosnia: Serb Minister Resigns over Customs Scandal,” Institute for War and Peace Reporting, 

Balkan Crisis Report, no. 343 (14 June 2002). <http://www.iwpr.net> 313 Jasna Babić, “MORH [Defense Ministry] Protects Arms Dealers Who Smuggle Weapons to ETA and IRA,” 

Nacional [Zagreb], 24 July 2001 (FBIS Document EUP20010724000372). 
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information from the Slink group in prosecuting the other group; the other explanation is that 

that group has bought protection from influential government authorities.314

Hrvoje Petrač, often characterized as the most powerful figure in the Croatian 

underworld, is connected with criminal groups elsewhere in the Balkans, but his link with the 

two domestic groups was not known as of September 2002. Although substantial evidence exists 

of Petra’s criminal activities, the state never has sought to prosecute him.315

Croatia is an important transit country along the Balkan Route connecting Turkey with 

Western Europe. At present Croatia does not have the resources to adequately patrol its land 

borders or the extensive islands and inlets of its Adriatic seacoast, which is adjacent to the crimeridden Albanian coast. The end of armed conflict in the former Yugoslavia has restored a large 

part of the pre-1992 trafficking along the Balkan Route.316 Narcotics traffickers have sought to 

exploit Croatia’s financial system to launder their profits. The system is handicapped in resisting 

such exploitation because it is widely dispersed and mainly cash-based. Bureaus of currency 

exchange and the real estate sector have been particularly vulnerable. Although moneylaundering legislation was passed in 1997, as of 2000 no convictions had been achieved under 

those laws.317

The incidence of human trafficking through Zagreb has increased since international 

agencies put stronger border and customs procedures into effect in neighboring BosniaHerzegovina, which had been the “weak point” of the region for the smuggling of persons. 

Because neighboring Yugoslavia has no visa requirement for Arab and Chinese citizens, the 

successful reduction of trafficking through Bosnia has diverted many illegal migrants to 

Belgrade, from whence many move through Zagreb before entering Western Europe.318

 

314 “Croatian Press Speculates on Underworld Groups’ Ties to Establishment,” FBIS Report, 24 September 2002 

(FBIS DocumentEUP20020923000505). 

315 “Croatian Press Speculates on Underworld Groups’ Ties to Establishment.” 316 U.S. Department of State, Bureau for International Narcotics and Law Enforcement Affairs, International 

Narcotics Control Strategy Report 2003. 317 Organisation for Economic Cooperation and Development, Financial Action Task Force on Money Laundering, 

“Croatia.” <http://www1.oecd.org/fatf/Ctry-orgpages/ectry-hr_en.htm> 

318 Hassan Haidar Diab, “Panic in Slovenia Due to Possible Release of Josip Lončarić,” Večernji List [Zagreb], 21 

November 2001 (FBIS Document EUP20011121000202). 
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Kosovo 

Kosovo, economically the poorest region of the Federated Socialist Republic of 

Yugoslavia that disintegrated in 1991-92, has been a hotbed of crime and the raison-d’etre of 

several regional terrorist organizations. In the last decade, organized crime has become what East 

European security expert Neil Barnett characterizes as “the mainstay of the Yugoslav province’s 

[Kosovo’s] economy.” Ongoing economic deprivation has combined with a strong but frustrated 

nationalist movement (including the goal to incorporate Kosovo and northern Macedonia into a 

“Greater Albania”) and the involvement of Serbia in a series of regional conflicts, to make law 

enforcement impossible.319 In addition, the Yugoslav government of Slobodan Milošević, faced 

with international economic sanctions from 1992 through 2000, ignored or encouraged the 

activities of organized crime groups whose smuggling supported the national economy. 

The intense nationalism of the Kosovo liberation movement combined with severe 

repression by the Milošević regime to reinforce the collective identity of Kosovars, strengthening 

the unity of criminal groups.320 Kosovar society’s view of law enforcement as only a tool of 

repression has inhibited crime reduction measures.321 These factors have made organized crime, 

particularly narcotics trafficking, an integral part of the volatile political situation in Kosovo.322

The United Nations and NATO forces that occupied Kosovo in 1999 were slow to take 

action against organized crime. Their reluctance to face this problem had two reasons: the 

establishment of political order and borders was the top priority, and the Western forces feared 

alienating local Albanian officials by assuming law enforcement functions. The view of many 

local Albanians and Kosovars that Western forces lack the authority to reinforce borders 

promotes the movement of illegal goods through the region. Typical of this phenomenon was the 

negative reaction of Kosovars and Albanians to the Belgrade-Skopje agreement of February 

2001, which attempted to re-establish a firm border between Serbia (including Kosovo) and 

Macedonia. The terms of the agreement brought widespread opposition among the ethnic 

Albanian populations of Kosovo, Macedonia, and Serbia proper, prolonging the lawless status of 

 

319 Neil Barnett, “The Criminal Threat to Stability in the Balkans,” Jane’s Intelligence Review, 1 April 2002. 320 Barnett. 321 Ralf Mutschke, “Links Between Organized Crime and ‘Traditional’ Terrorist Groups,” testimony to U.S. House 

of Representatives, Judiciary Committee, Subcommittee on Crime, 13 December 2000. 

<http://www.russianlaw.org/Mutschke> 

322 Barnett quotes a Kosovo police official on this subject: “Discussing Albanian politics without considering 

narcotics trafficking is like discussing Saudi politics without considering oil.” 
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the region. According to Barnett, the political influence wielded by powerful heroin-trading 

groups is likely to delay stability in the region.323 International authorities also are hampered by 

requirements of Yugoslav law, which remains in force because of Kosovo’s ongoing 

international status as a province of Yugoslavia. Yugoslav law prohibits the use of devices such 

as sting operations, paid informants, and electronic surveillance. Albanian translators, on whom 

authorities must rely for communication with the populace, often pass police intelligence to 

criminals.324

The activities of a series of Albanian insurgent groups also have served the interests of 

organized crime in Kosovo. The Kosovo Liberation Army and its smaller successor groups, the 

National Liberation Army and the Albanian National Army, pursued guerrilla and terrorist 

activities for the liberation of Kosovo from Serbia and for the liberation of Macedonia’s 

Albanian population from the Slavic majority in Macedonia. Smuggling and other criminal 

activities have flourished in regions held by rebel groups. The KLA and its successor groups are 

widely assumed to have gained substantial support from active participation in the smuggling of 

people and narcotics, which often have been exchanged for arms. Rebel areas also reportedly 

have supported production of amphetamines and the smuggling of cigarettes and weapons.325

The most significant criminal activity in Kosovo is the trans-shipment of heroin from 

Turkey into Western Europe, along the so-called “Balkan route.” Heroin shipments move from 

Turkey through Bulgaria and Macedonia, then pass over the porous border between Macedonia 

and Kosovo before continuing either into southern Serbia and Hungary or into Albania. NATO 

forces have not been successful in blocking routes across the difficult terrain of the MacedoniaKosovo border. Passage from Kosovo into Albania has been eased by especially poor security at 

Peč, on the Kosovo side. An important transit point in Kosovo is Podujevo, where rich and 

influential Kosovars support the trade. The so-called Italian Route, which passes through Kosovo 

and Albania before crossing the Adriatic Sea into Italy, has been established by closely related 

clans in Kosovo and Albania, each of which has its own specifically defined territory.326 Fuel 

 

323 Barnett. 324 “Law Enforcement in Kosovo,” Jane’s Intelligence Review, 1 April 2002. 325 Barnett. 326 Barnett. 
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smuggling also is a profitable form of crime, especially in the security zone between Kosovo and 

Montenegro.327

Macedonia 

Lying between Bulgaria and Kosovo, Macedonia falls naturally on the narcotics transit 

line of the Balkan Route. Macedonia’s location immediately south of the Federal Republic of 

Yugoslavia, which has been the subject of international trade sanctions since 1992, also has 

made it a natural path for smuggling activity in a variety of otherwise legal commodities. 

Although Macedonia has not suffered armed conflict at the level of its neighbors BosniaHerzegovina and Kosovo, internal ethnic conflict and the conflict between neighboring Serbia 

and Kosovo have removed some regions of Macedonia from effective law enforcement over a 

long period. 

Especially important in this regard has been the city of Tetovo in northern Macedonia, 

which has been the site of fighting between Albanian insurgents and Macedonian forces, as well 

as between different groups of Albanian insurgents. Although the Macedonian government 

nominally controls Tetovo, local police have not cooperated in stopping likely smugglers as they 

pass through the city.328 The government’s border policy has been pragmatic. Macedonia has 

signed a bilateral agreement with Bulgaria, the one neighbor with which it has stable relations, 

but has relied on stopgap measures on the more problematic borders with Albania, Serbia, 

Greece, and Kosovo. 

The U.S. Department of State does not characterize Macedonia as a major narcotics 

transit country, although regional instability caused trafficking to increase markedly in 2001. 

Nevertheless, the report notes, “The political will does not exist within the government to 

address seriously drug trafficking and its effects..., and needed legislation is likely to languish 

for at least another year.”329 Macedonia has several clan-based domestic narcotics networks, 

which specialize in transit links with and resale to organizations outside the country. Narcotics 

activity is centered in the western part of Macedonia, although transit lines extend to all 

 

327 “Kosovo: Fuel Smugglers Flourishing,” Institute for War and Peace Reporting report, 28 February 2002. 

<http://www.iwpr.net> 

328 Barnett. 329 U.S. Department of State, Bureau for International Narcotics and Law Enforcement Affairs. 
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regions.330 The cities of Kumanovo and Skopje, which lie on a weapons smuggling route, have 

been documented as points where Kosovar insurgent groups exchange narcotics for weapons.331

The U.S. Department of State has identified Macedonia as both a destination and a transit 

country for the trafficking of women and children originating in Ukraine, Moldova, Romania, 

and Bulgaria and destined for Albania, Kosovo, and Italy. However, in 2002 Macedonia passed a 

new law against trafficking and associated activities, the judiciary has effectively prosecuted 

cases against traffickers, and government programs provide assistance to victims.332

Macedonia’s role as a smuggling corridor and the recent decade of regional turbulence 

have made the country a likely target for money laundering and other types of financial crime. In 

2001 the Ministry of Finance reported that about 1,000 financial crimes are committed per year, 

including fraud and forgeries related to privatization in the public sector, tax evasion, and money 

laundering. Money laundering is associated with trafficking in arms, alcohol, cigarettes, coffee, 

narcotics, and stolen cars; tax evasion; fraud; and corruption. According to the ministry, the main 

weak point promoting such activity is the Macedonian financial system’s inability to monitor 

cash transactions, nonresidential bank accounts, and the privatization process. In August 2001, 

Macedonia passed a new law against money laundering, designed to comply with West European 

standards. The law established a Directorate for Money Laundering Protection.333

Criminal organizations operating in Macedonia have benefited from government 

corruption. An August 2002 report by the International Crisis Group described dishonest 

practices at the highest level of the government. Said the report, “In effect, the state has come to 

function in important respects as a ‘racket,’ and the racketeers thrive in a culture of impunity. It 

[corruption] is also a cross-community shared enterprise, and collusion between ethnic leaders 

serves to heighten tensions.” Transparency International has estimated that corruption has 

deprived the state of 250 million euros (about US$250 million) in revenues. Irregularities have 

 

330 “Macedonia Has the Largest Transit of Drugs for the Albanian Narco Mafia,” Reality Macedonia report, 6 

November 2001. <http://www.realitymacedonia.org.mk> 331 “Macedonian Government Confirms Ethnic Albanians Buying Arms from Drug Funds,” Nova Makedonija

[Skopje], 20 February, 2002. 

332 U.S. Department of State, Trafficking in Persons Report, June 2002. 333 Darko Arsov, “Money Laundering: The Most Sophisticated Form of Organized Crime,” Ministry of Finance 

Bulletin [Skopje], December 2001. <http://www.finance.gov.mk/gb/bulletins> 
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been found in the privatization of state enterprises, and customs officials have been implicated in 

freight transport and tobacco-smuggling schemes.334

Serbia and Montenegro 

In the past 20 years, the states of Serbia and Montenegro, which since June 2003 have 

been the constituent parts of a loose federation formerly known as the Yugoslav Republic, have 

suffered especially from criminal activity because of political and international conditions. 

Although those conditions have improved markedly since 2000, reform has not yet disrupted 

many of the corrupt power relationships formed under the regime of Slobodan Milošević (1989-

2000). That government has been characterized as a “kleptocracy.”335 According to former 

Belgrade police chief Marko Niković, the democratic coalition that gained power after Milošević 

accepted the support of the same criminal elements that had supported the previous regime, thus 

perpetuating the power base of those groups.336

In the 1990s, the international position of the Milošević regime contributed to criminal 

activity. At that time, trafficking of goods became more profitable in Yugoslavia when 

international sanctions cut the country’s normal supply lines. The government and trafficking 

groups shared profits on fuel, consumer goods, cigarettes, electronic equipment, agricultural 

goods, and spare parts. State authorities worked with criminal groups to strip assets from stateowned enterprises, manipulate the national monetary system, and smuggle arms. Although the 

Yugoslav Republic337 has made some reforms in the institutions that promoted organized crime 

since the ouster of the Milošević government in October 2000, in late 2002 Serbian criminologist 

Dobrivoje Radovanović reported that the infrastructure of criminal organizations, which was 

promoted intentionally by government authorities in the 1990s, remained intact: 

“... it is true that the police have been largely responsible for the existence of organized 

crime in our country since 1992. The State Security [Service] to be precise. They invited 

prominent underworld bosses to be their associates in the battle for the Serbian national 

interests in Bosnia, Croatia, and other parts. The secret police was through them involved 

in the plundering, war crimes, and war profiteering. They enabled every prominent 

 

334 Ana Petruseva, “Macedonia: Threats Follow Corruption Report,” Institute for War and Peace Reporting report, 

21 August 2002. <http://www.iwpr.net> 

335 Dziedic, Rozen, and Williams, 4. 336 Michael Dobbs, “Pivotal Alliance Frayed Before Serb’s Death,” Washington Post, 14 March 2003, A18. 337 This report treats one province of the Yugoslav Republic, Kosovo, in a separate section because of its unique 

circumstances. 
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criminal to have a DB [Security Service] identity card. A consequence of that was the 

overlapping of the secret police, the underworld, and the police.”338

Although Radovanović found substantially more transparency in government operations 

than he did in the Milošević era, two years after the end of that era he still reported a substantial 

connection between Serbia’s political underworld and its criminal underworld.339 Confirming 

that view, a 2002 report of the United States Institute of Peace characterizes the State Security 

Service and the Military Security Service, which are Yugoslavia’s two major intelligence 

agencies, as “virtually autonomous entities.”340A 2002 regional corruption report found 

significant increases in corruption rates in Montenegro, the smaller of the states of Yugoslavia, 

between 2001 and 2002.341

According to Radovanović, Serbia is home to Albanian, Chinese, and Russian organized 

crime groups, although a “Serbian mafia” per se does not exist. Chinese groups have used Serbia 

as a staging area for illegal immigrants to move into the West, and Russians groups have used 

Serbia for both recruiting and transit of women for their prostitution industry. Serbia is a major 

transit country for women trafficked from the eastern source countries Moldova, Romania, and 

Ukraine to Bosnia-Herzegovina and points west. Some progress has been made against 

trafficking in recent years, however. The present government of Yugoslavia has eliminated black 

markets in cigarettes, oil, and precious metals, which attracted substantial foreign criminal 

activity in the 1990s.342

In the fall of 2002, the Yugoslav Republic was accused of government-sanctioned 

exports of illegal arms to two critical areas of the world, Iraq and West Africa. The nature of the 

transactions indicates knowledge by at least some officials in Yugoslavia’s Ministry of Defense, 

and a major import-export firm has been directly implicated in the transaction with Iraq. 

International press reports also have accused Serbia’s Yugoimport trading firm of having 

cooperated with the Orao defense plant in Bijeljina, Bosnia, and two other Bosnia arms 

companies in shipping fighter aircraft engines and air defense equipment to Iraq via Syria. 

 

338 B. Ristić, “Whose Arm Runs Serbia?” Glas Javnosti [Belgrade], 3 November 2002 (FBIS Document 

EUP20021104000406). 

339 Ristić. 340 Dziedzic, Rozen, and Williams, 5. 341 Southeast European Legal Development Initiative. 342 Ristić. 
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Allegedly, ultranationalist Serbian Radical Party leader Vojislav Šešelj received a large profit 

from his role as mediator of the export deals with Iraq.343

In the West Africa case, six arms shipments were sent by the Serbian firm Timex, 

nominally on behalf of the Serbian military, via the Serbian shipping company Jitterbug.. The 

nominal recipient was the Ministry of Defense of Nigeria, but the actual destination was Liberia. 

In this case, Yugoslav authorities made two mistakes: they accepted false documentation from 

arms brokers stating that the shipment was destined for Nigeria, and they ignored a moratorium 

on small arms shipments to West African states, including Nigeria.344

The circumstances of the two arms export cases indicate weak arms export controls and 

official corruption. Although Yugoslavia is not rated as a major source of military supplies, 

United Nations authorities have urged the Republic of Yugoslavia to tighten arms-export 

procedures to reduce Yugoslavia’s participation in chronic arms trafficking from Eastern Europe 

to trouble spots in Africa.345

Conclusion 

In the past decade, the activities of criminal groups have found fertile ground in most of 

the countries of Central and Eastern Europe, and a substantial amount of terrorist activity has 

occurred in parts of the former Soviet Union and the former Yugoslavia. Such success has 

resulted from two sets of factors. First, the overall globalization and increased versatility and 

sophistication of criminal organizations (and, to a lesser extent, terrorist groups) have improved 

their ability to take advantage of weak customs systems, poorly guarded borders, corrupt 

officials, poverty-stricken national economies, and well-established shadow economies. Second, 

geopolitical and domestic conditions have provided such groups an increasing range of such 

favorable circumstances. Intense poverty in countries such as Moldova and Belarus creates a 

supply of women for transnational traffickers, and social mores prevent those women from 

returning to a normal life. The collapse of a major empire (the Soviet Union) has left large, 

poorly guarded arsenals of weapons in countries desperately needing money. This situation is 

 

343 Michael Wrase and Waltraud Kaserer, “Belgrade Smuggled Weapons to Iraq,” Welt am Sonntag [Hamburg], 27 

October 2002 (FBIS Document EUP20021027000097). 

344 Robert McMahon, “Yugoslavia: Arms Expert Traces Belgium-to-Liberia Arms Trafficking, Radio Free 

Europe/Radio Liberty report, 11 January 2002. <http://rfc/rl.org> 

345 “Yugoslav Arms-Export Scandal Grows,” RFE/RL Newsline, 6, no. 207, pt. II (1 November 2002). 
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most alarming in Russia, where remnants of the Soviet Union’s nuclear stockpile remain under 

very dubious control. 

The collapse of the Yugoslav federation, which led to an escalated version of earlier 

ethnic strife in the region, has combined with the authoritarian ambitions of some leaders to 

destroy the rule of law in the western Balkans and created a platform for all forms of trafficking 

on the doorstep of Western Europe. The stress of the drastic economic transition that began in 

the former Yugoslav federation in the 1990s has left most governments unable to pay civilian 

officials or security officers enough to prevent widespread official corruption and the illegal sale 

of state property. 

In many cases, in this region the corruption, trafficking routes, and shadow economies of 

the 1990s already were well-established under authoritarian regimes of the old Soviet system. In 

discussing these nations as hospitable to transnational crime, the role of such traditions cannot be 

over-emphasized. Even given substantially better economic incentives, in the countries most 

insulated from the incentives of participation in Western institutions (most of the Caucasus and 

the Central Asian republics), overcoming intrinsic attitudes toward the rule of law and economic 

behavior may simply require a passing of generations. 

SOUTH ASIA 

Introduction 

South Asia is characterized by a disproportionately large number of intra- and inter-state 

conflicts having varying levels of intensity. These conflicts create a permanent degree of 

instability in the region that tends to attract and create organized criminal groups as well as 

insurgents with both internal and external agendas. Under these conditions, severely limited 

government resources face numerous battle fronts: illegal trafficking, separatist insurgencies, 

poverty, population explosions, an AIDS epidemic, and porous borders that states do not have 

the resources or will to police adequately. 

Each of the countries of South Asia is a major producer, exporter, or transit area for 

narcotics. Many actors, including growers, traffickers, and government officials, have a stake in 

perpetuating this situation. In South Asia, politicians have frequently used violence and coercion 

as a means to attain political victory: votes often are won at gunpoint. This practice creates a 
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nexus between politicians and criminals, as the latter supply guns and manpower to “sway” voter 

opinion. 

South Asia has appeared prominently in international terrorism reports as well. Since the 

end of the Cold War, this part of the world has shown a strong linkage between terrorist and 

criminal activity. The relationships among parties who cause and benefit from South Asia’s 

instability are extremely complex. Tribal, ethnic, sectarian, and economically motivated violence 

is so prevalent and intermixed that no single cause or motive can be identified. One factor in this 

complexity is the ambiguous distinction between terrorism and national liberation movements, 

which are very different labels applied to groups such as the Sri Lankan Tamil Tigers of Elam 

(LTTE) by different sides in Sri Lanka’s chronic unrest. Nonetheless, certain identifiable trends 

and conditions in individual countries and across the region make South Asia ripe for organized 

criminal and insurgent activity, both inter- and intra-state. 

A number of terrorist and criminal groups in the region have integrated themselves in the 

legal economies of more than one country. For example, the United Liberation Front of Assam, 

an insurgent group based in India’s northeastern territory, owns legitimate businesses, including 

travel agencies, public relations companies, hotels, medical clinics, motor instruction schools, 

and shops in Bangladesh and Bhutan.346 The D-Company of Dawood Ibrahim, one of India’s 

most powerful criminals, is essential to Pakistan’s economy. Ibrahim reportedly is highly 

influential in Pakistan’s stock market, has invested billions in real estate, and has given financial 

assistance to the Central Bank during a financial crisis.347

Another regional problem is the interconnection of violent groups with government 

officials. Legitimate political parties often represent insurgent groups in government. For 

example, in Pakistan the leader of the banned Sipah-e-Sahaba Pakistan Party (SSP) won a seat 

from central Punjab province while in detention, and the Muthida Qaumi Movement, which is 

said to receive funds through both organized crime and the Indian government, also functions as 

a political party.348

 

346 “United Liberation Front of Assam (ULFA),” Jane’s World Insurgency and Terrorism, 7 March 2003. 347 Nick Meo, “All Eyes on India’s Most Wanted,” Sunday Herald [Glasgow], 27 January 2002. 

<http://www.sundayherald.com/print21831> 

348 “South Asia, Internal Affairs,” Jane’s Sentinel Security Assessment, 15 May 2003. 
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Bangladesh 

Bangladesh has suffered from the widespread organized crime and linkages to regional 

terror, criminal, and political groups prevalent in South Asia. Terrorism has been much less of a 

problem in Bangladesh than wide-ranging violence and lawlessness. Those conditions are fed by 

an arms market located at Cox’s Bazar on the Bay of Bengal in the country’s far southeast 

corner. Lawless and violent conditions in the northeast territory of India, which borders 

Bangladesh on the east, help to explain the location of this smuggling center. The ready 

availability of arms in turn contributes to Bangladesh’s attractiveness to foreign terror groups 

and transnational smugglers. Much of the responsibility for this hospitable environment can be 

placed on the government and its legacy. 

Role of Government 

Newspaper accounts accuse political leaders in Bangladesh of fostering terrorism and 

crime to win the political upper hand and/or grow rich.349 This situation is partially the legacy of 

years of military dictatorship, but it persists because of the ruling civil-military oligarchy’s use of 

“thugs and goons” against political opponents.350 Armed conflicts between supporters of the 

major political parties are a common occurrence in the countryside.351

According to one scholar, violence was an essential part of Bangladesh’s coming into 

being and identity. The violence is carried over into the students’ political groups, which 

traditionally play an important role in supporting political parties and have served as arenas for 

proxy wars by politicians. Student wings of parties now have their own armed cadres, supplied 

by underground arms dealers.352 The only force available to counter this perpetual state of 

“human insecurity” is an ill trained and underpaid police force that is highly susceptible to bribes 

and often is directly involved in the arms trade.353 In 2002 Transparency International named 

 

349 Dia Ganguly, “Justice and Force in Bangladesh,” World Press Review, 12 December, 2002. 

www.worldpress.org/Asia/861.cfm. 350Neila Hussain, “Proliferation of Arms and Politics in South Asia: The Case of Bangladesh,” Regional Centre for 

Strategic Studies [Colombo], Policy Studies, 7 (May 1999). <www.rcss.org/policy.html> 351 “Daily Details Bangladesh as Transit Point for Arms Smuggling,” Dainik Janakantha [Dacca], 16 July 2000 

(FBIS Document SAP20000722000010). 

352 Hussain 

353Ganguly
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Bangladesh the most corrupt nation in the world for the second year in a row.354 Even when 

corrupt officials are prosecuted, they generally receive no more than a reprimand.355

Student politics and terrorism have been strongly associated in Bangladesh. With the rise 

of the Jamiat e-Islami, the Islamic party, this association is becoming stronger. Militant Islamic 

groups such as the Harakat ul-Jihad ul-Islami, reportedly supported by al Qaeda, have grown 

bolder since the Jamaat e-Islami gained two cabinet positions and became the third largest holder 

of parliamentary seats in the elections of October 2001. In recent years, the militant youth wing 

of that party, dominated by students of madrassas, private Islamic schools, has increased in 

influence.356 Because public schooling is unavailable to most students in Bangladesh and the 

madrassas attract funding from Saudi Arabia, those schools have grown rapidly in the last ten 

years.357 Religiously motivated violence, particularly against the Hindu minority, has increased 

since the 2001 election, indicating at least a degree of political sanction.358

Arms Availability and Insurgent Alliances 

Bangladesh’s cycle of violence is perpetuated by the ready availability of arms from 

international smugglers operating at Cox’s Bazar and Bandarban, a second arms trafficking point 

in the far southeast. That region also is home to insurgent groups and refugees from the conflict 

in Burma such as the Rohingya Solidarity Organization (RSO). Consignments of firearms enter 

Bangladesh through 30 unauthorized border points in addition to the international seaport of 

Chittagong and Cox’s Bazar.359 Smugglers receive arms from Cambodia via Thailand on highspeed fishing boats; directly from the Burmese military; indirectly from Burmese insurgent 

groups selling weapons stolen from the military; by theft or purchase from the Bangladeshi 

 

354 Transparency International, Corruption Perceptions Index 2002. 

<http://www.transparency.org/cpi/2002/cpi2002.en.htm> 

355 U.S. Department of State, Bureau for International Narcotics and Law Enforcement Affairs, International 

Narcotics Control Strategy Report 2002. <http://www.state.gov/g/inl/rls/nrcrpt/2002/html> 356 “United Liberation Front of Assam (ULFA),” Jane’s World Insurgency and Terrorism [London], 16 (7 March 

2003). 

357Bertil Lintner, “A Cocoon of Terror,” Far Eastern Economic Review, 4 April 2002. 358 Rob Fanney, “Bangladesh: Harakat-ul-Jihad-ul-Islami,” Jane’s World Insurgency and Terrorism, 14 November 

2002. 

359 “Daily Details Bangladesh as Transit Point for Arms Smuggling.” 
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Rifles, a paramilitary group; and from private arms dealers on the Thai-Cambodia border, a 

transit point for illicit arms sales since the 1980s.360

Arms reportedly reach a variety of regional terror groups as well, including the Tamil 

Tigers of Tamil Eelam (LTTE) in Sri Lanka, rebel groups in India’s northeast territory, Burmese 

insurgents, and domestic political groups.361 The far southeast also is considered a stronghold of 

the Jamaat-e-Islami and its youth wing, as well as more extreme groups. Islamic fundamentalism 

appears to be on the rise in Bangladesh, equaling other domestic political movements in its use 

of violent means. 

According to unconfirmed reports, training camps in Bandarban and Cox’s Bazar have 

sent fighters to insurgent conflicts in Kashmir, Chechnya, and Afghanistan. Other reports 

describe fleeing members of the Taliban and al Qaeda having received shelter in southeastern 

Bangladesh in January 2002.362 Indian intelligence has claimed that Pakistan’s Interservice 

Intelligence Agency (ISI) has established outposts in India’s West Bengal state, which adjoins 

Bangladesh’s lawless corner, with the help of extremists from Bangladesh. Several legal arms 

factories in West Bengal may have facilitated such a move. Arms traffickers are known to have 

expropriated explosives, ammunition, and arms from those plants for the illegal arms trade.363

India 

Several conditions make India potentially hospitable to transnational organized crime and 

terror groups. India is flanked by the leading producers and exporters of illicit heroin and is itself 

the largest producer of licit opium and illicit methaqualone in the world. The regional drug trade, 

over land, air and sea routes, is extremely profitable for groups willing to take risks, and 

pervasive poverty makes risk-taking worthwhile for a large percentage of the population. India’s 

many internal separatist movements create a permanent state of instability and violence. 

India has five less than ideal neighbors: Pakistan which is a long-time adversary in an 

enduring struggle over the northeastern state of Kashmir; Bhutan, Burma, and Nepal, which 

continue to battle their own insurgencies with inadequate resources backed by largely ineffectual 

state structures; and Bangladesh, which faces insurgencies similar to those in India’s northeast 

 

360 Fanney. 361 “Daily Details Bangladesh as Transit Point for Arms Smuggling.” 362 Fanney. 363 “Daily Details Bangladesh as Transit Point for Arms Smuggling.” 
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territory and is essentially the continent’s arms bazaar.364 The porous borders among such 

neighbors offer numerous opportunities for cooperation among groups willing to achieve similar 

short-term illegal goals, often with the assistance of corrupt politicians on both sides of a border. 

India’s legal system is too slow and unwieldy to deter criminal behavior effectively. 

Destabilizing Factors 

According to regional experts, India suffers from at least five protracted internal wars, 

not including the Kashmir conflict, and approximately 100 domestic insurgent/terrorist groups 

are active.365 The northeast region is host to several separatist ethnic groups that employ terrorist 

tactics and have forward bases in Bangladesh and Bhutan, revealing the transnational character 

of the conflicts in this area. Many of these same groups cooperate with each other or with other 

insurgent groups across India and the region, for the sake of expediency. Some of the groups 

allegedly receive support from Pakistan’s ISI as well. Another destabilizing factor, extreme 

poverty, feeds perceptions of disparity and is coupled with coincidental ethnic, religious or tribal 

cleavages. 

Regional Insurgencies and Conflicts 

India’s northeast region is connected to the rest of India through a very narrow corridor 

that is surrounded by territory belonging to Bhutan and Bangladesh. This geographical factor 

complicates India’s efforts at control and exposes the region to transnational insurgency and 

criminal activity. Pakistan’s ISI reportedly provides bases, weapons, and training to insurgents in 

the region, for example, and Bangladeshi law enforcement personnel engage in smuggling across 

their border into the region. Because of this situation, insurgents are able to establish bases in 

adjoining territory of Bhutan and Burma, over which those countries have little control. 

 

364 “The Arms Race in Bangladesh: Issues and Challenges,” The Daily Star [Dacca], 29 July 2001. 

<http://www.dailystarnews.com/law/200107/05/right.htm> 365 Derived from listing at South Asia Terrorism Portal.

<http://www.satp.org/satporgtp/countries/india/terroristoutfits/index.html> 
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Smuggling and illegal migration are rampant in the region.366 India has been fighting rebels in 

two states of the northeast region, Nagaland and Assam, since 1955 and 1990, respectively.367

Each of the region’s seven Indian states is characterized by lawlessness, underperforming and corrupt institutions, and separatist conflicts that blur the distinction between 

insurgency and crime. According to one estimate, the United Liberation Front of Assam (ULFA) 

earned US $22 million from extortion in 2001. The ULFA also demonstrates another trend in the 

region: the growing cooperation among groups and the permeability of borders. At the end of the 

1980s, the ULFA joined the Indo-Burmese Revolutionary Front (IBRF), which also includes the 

National Socialist Council of Nagaland, the Kuki National Front of Manipur Province, and the 

Chin National Front (a Burmese insurgent group fighting the government in Yangon). The 

United National Liberation Front (UNLF), based in Manipur, conducted activities on behalf of 

the ULFA in 2002. It also has alliances with groups in Burma that arrange weapons for the 

group, as does the ISI, by facilitating links with the LTTE in Sri Lanka and the Harkat-ul-Jihadul-Islami in Bangladesh. Bangladeshi and Burmese groups reportedly have crossed the border 

into India to escape reprisals after conducting raids in their respective countries. 368

The nexus between crime and insurgency in the northeast region is growing as many of 

the insurgent groups engage in smuggling, extortion, and kidnapping. The drug trade is part of 

this nexus as well, crossing the border in both directions and leaving in its wake a narcotics 

addiction epidemic and a sharp increase in HIV/AIDS cases. The ULFA reportedly supplements 

its criminal activities with profits from legitimate businesses and front companies in Bangladesh 

and Bhutan. Such a strategy marks the passage of such groups into a kind of self-sustaining 

legitimacy.369

Conflicts in the states of Kashmir and Punjab have been active for more than ten years. 

Although Kashmir is an international conflict and Punjab domestic, both require long-term 

military presences. India has been in intermittent conflict with Pakistan over the disposition of 

 

366 Christopher Jasparro, “Transnational Pressures Destabilize India’s Northeast,” Jane’s Intelligence Review, 12 

November 2002. 

367 P. Sahadevan, “Coping with Disorder: Strategies to End Internal Wars in South Asia,” Regional Centre for 

Strategic Studies [Colombo], Policy Studies, 17 (November 2000). <www.rcss.org/policy.html> 368 “United Liberation Front of Assam (ULFA).” 369 “United Liberation Front of Assam (ULFA).” 
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Kashmir since 1989. The conflict diverts 700,000 of India’s combined army and paramilitary 

forces, leaving scant security to deal with other threats or groups that exist.370

Organized Crime 

In some ways, organized crime in India is typical of the region. It is facilitated and 

spread by extreme levels of corruption and government inefficiency. It is used by politicians to 

coerce voters or to intimidate opponents. The opposite also is true; criminals enter politics to 

gain a different kind of legitimacy—and often are successful. There are also reports of collusion 

between entire ruling parties and certain organized crime groups, whose fortunes change as 

ruling parties change.371

Organized crime in India has an unusual transnational character and involves a variety of 

players. Transnational crime does not flow in the typical direction; its major figures are Indian, 

but they live abroad. The major figures—Dawood Ibrahim, Chota Rajan, Fazlur Rahman, 

Babloo Srivastav, and Farjan Malik—all operate from foreign bases, most often Dubai. The 

location of Ibrahim, who is the undisputed crime boss of Mumbai (Bombay), is unknown. Some 

sources claim that he is under the protection of Pakistani intelligence in Karachi.372

Ibrahim’s notoriety is due less to his success as a crime boss than to his role in a 1993 

terrorist bomb attack in Mumbai in which hundreds were killed. That attack purportedly was in 

retaliation for the destruction of a mosque and the slaughter of hundreds of Muslims by Hindu 

fundamentalists.373 Another Dubai-based gangster, Farjan Malik, claimed responsibility for the 

January 2002 bombing of the American Cultural Center in Calcutta. Indian sources claim that 

both Farjan and Ibrahim are agents for Pakistan’s ISI. Dawood and six other members of his 

gang are on a list of “20 most wanted terrorists” whose extradition India has demanded from 

Pakistan.374

 

370 Ahmed Rashid and Joanna Slater, “Threats and Consequences,” Far Eastern Economic Review, 6 June 2002. 371 Molly Charles, “The Growth and Activities of Organised Crime in Bombay,” UNESCO, 2001 Oxford, England; 

Charles, “The Drug Scene in India,” presentation at Drug Abuse: A Symposium on Social Processes, Narcotics and 

the State,” Mumbai, August 2001. <http://www.india-seminar.com/2001/504/504%20molly%20charles.htm> 

372 Meo. 373 Meo. 374 Muzamil Jaleel, “India’s Demands,” The Observer, 13 January 2002. 

www.observer.co.uk/international/story/0,6903,632110,00.html
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Further highlighting the coalescing of groups and motives throughout the region is the 

case of another gang boss, Ashwin Naik, who is based in New Delhi. In 2000 investigators 

learned that Naik had been cooperating with the Sri Lankan LTTE in narcotics trafficking and 

extortion rackets in Mumbai.375 According to Indian intelligence, during his election campaign in 

Uttar Pradesh state gangster Chhota Shakeel was implicated in an assassination attempt on Union 

Home Minister L. K. Advani in 2002, as were the ISI, Al-Furkan (formerly Jaish-e-Mohammed) 

and assorted “underworld people”376 Ali Khan, a “Pakistani druglord,” sent consignments of 

heroin across Pakistan’s border with the Indian state of Rajasthan, from where it entered an 

LTTE-controlled network culminating in Sri Lanka.377

Because of its location, India always has been a key transit country for narcotics moving 

from Pakistan and Afghanistan and from the Golden Triangle to Europe. According to Molly 

Charles of the National Addiction Research Centre in Mumbai, in India’s early days organized 

crime groups took advantage of restrictive national tariff and foreign exchange policies to 

establish profitable channels of illegal trafficking in numerous items, including narcotics. 

Although trade liberalization eventually removed the profit motive for the first wave of narcotics 

traffickers, their network still was in place in the early 1980s when new groups began developing 

a heroin market in India. Like other forms of trafficking, narcotics smuggling has profited from 

ongoing corruption in political parties and government bureaucracy.378 Domestic heroin 

production benefits from India’s international status as the world’s largest legal grower of opium 

poppies for the pharmaceuticals industry; experts estimate that 10 to 30 percent of the legal 

opium crop is diverted to the manufacture of illegal heroin. In 2000 India produced 1,300 tons of 

opium gum.379

India is a major transition country in two narcotics routes that link Pakistan with Sri 

Lanka. The first moves heroin and hashish from Pakistan to Mumbai, where they are packed and 

sent by boat to the ports of Tuticorin or Rameswaram in Tamil Nadu state at the southern tip of 

 

375 “... But What about Remote-Control Operations?” The Times of India [Mumbai], 27 March 2000. 376 “Advani's Security Beefed Up,” The Times of India [Mumbai], 13 February 2002.

<http://timesofindia.indiatimes.com/cms.dll/xml/uncomp/articleshow?msid=882143>

377 Nurupama Subramanian, “Delhi-Chennai-Colombo-Narcotics Racket Flourishes,” Indian Express [Mumbai], 2 

November, 1999. <www.indianexpress.comie/daily/19991102/ige02045.html> 

378 Molly Charles, “The Drug Scene in India,” presentation at “Drug Abuse: A Symposium on Social Processes, 

Narcotics and the State,” Mumbai, August 2001. <http://www.indiaseminar.com/2001/504/504%20molly%20charles.htm> 

379 U.S. Drug Enforcement Administration, “India Country Brief,” May 2002. 

<http://www.usdoj.gov/dea/pubs/intel/02022/02022p.html> 
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India. The second route moves the same drugs from Pakistan to Delhi via Jaisalmer and Bearmer 

in Rajasthan, whence they are sent overland to Tamil Nadu. Both routes then bring the drugs 

from Tamil Nadu to Colombo or Jaffna in Sri Lanka.380 Narcotics couriers move heroin via 

commercial airlines, mainly from Mumbai and New Delhi, to more distant international points. 

India’s large pharmaceuticals industry is the world’s largest producer of illegal mandrax 

(the commercial name of the depressant drug methaqualone, whose legal use as a sedative ended 

in the 1980s). That substance has contributed substantially to addiction and drug-related crime in 

South Africa, which is a major consumer of that substance. Mumbai is the main Indian transit 

point for mandrax that is smuggled into South Africa.381 In 2000 and 2001, Indian authorities 

confiscated shipments of more than one ton of mandrax each in Hyderabad and Mumbai, 

respectively. India’s chemical industry also legally produces large amounts of chemicals such as 

acetic anhydryde and ephedrine that are precursors for the manufacture of amphetamines and 

other types of illegal drugs. As of 2002, the Narcotics Control Bureau, India’s primary drug 

enforcement agency, monitored the distribution of some but not all of those chemicals.382

Organized criminal activities in India also include a thriving gems and semi-precious 

stones trade with both South Africa and Belgium. In trafficking transactions involving India, 

gold and diamonds frequently are an exchange medium for transnational money laundering. 

Diamonds also are used to disguise shipments of heroin because the value and weight of the two 

commodities are similar.383 Other criminal activities include smuggling of luxury items; 

extortion; professional killings; money laundering through the hawala network; and trafficking in 

small arms, narcotics, and humans.384

As India develops into an important regional financial center, proceeds from criminal 

activities such as trafficking arms, gems, narcotics, and migrants increasingly are laundered in 

the country’s financial institutions. Funds for terrorist groups also pass through India’s system. 

India also licenses offshore banking units, which are not monitored strictly. Much of India’s 

illegal money transfer is part of the international hawala system, which is impossible to control 

effectively because it depends heavily (although not exclusively) on barter and credit. Gold and 

 

380 “LTTE’s Drug Trafficking Links,” Daily Reports from Reality of Sri Lanka, 15 March 2000. 

<www.realityofsrilanka.com/d153Mar00.htm> 381 “Mandrax,” Electronic Doctor [South Africa]. <http://www.edoc.co.za/drughelp/mandrax> 382 U.S. Drug Enforcement Administration. 383 Charles. 384 Neeraj Kumar, “Organized Crime,” PoliceSpeak, November 1999. <www.india-seminar.com/1999/483.htm> 
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diamonds are the most frequently exchanged commodities in this system. India passed a 

comprehensive bill criminalizing money laundering only in January 2003; the new financial 

investigative unit required by the bill has not yet gone into service.385

Corruption 

Although India has official policies against organized criminal activity, corruption at all 

levels of the government, from border officials to law enforcement agencies to politicians, makes 

them wholly ineffective. In fact, corruption is so endemic that crematorium workers demand 

bribes to ensure enough wood is used to burn the dead.386 Of the 68 precincts in Mumbai, eight 

are regularly auctioned off to the officers with the highest bid. Their popularity is due to their 

locations near brothels, airports, and the homes of major criminals where bribery will make these 

officers rich over a term that lasts at least three years.387

Corruption has been especially dangerous in the northeast region, where the ability to 

control international borders is especially important. In some cases, government personnel 

assigned to this region collect their pay without ever taking their post or continue to collect after 

having abandoned the post. Corruption among law enforcement personnel in the northeast is so 

serious that army units burn narcotics confiscated at border crossings to avoid handing the drugs 

over to superiors who would resell them.388

The involvement of politicians at the national level with organized criminal groups is 

indicated by the rise and fall of these groups with changes in the political leadership. The 

Congress Party, for example, backed the Varadharajan criminal group, which had a strong Tamil 

membership in Mumbai. With the rise of the anti-Tamil Shiv Sena Party in Mumbai in the mid1990s, the Varadharajan group lost its strong position and other groups prospered in its place.389

 

385 U.S. Department of State, Bureau for International Narcotics and Law Enforcement Affairs, International 

Narcotics Control Strategy Report 2003. (Washington, D.C.: 2003), XII-183-84. 386 “India 2002-2003,” Jane’s World Armies, 8 April 2002. 387 Charles, “The Growth and Activities of Organised Crime in Bombay.” 388 Jasparro. 389 Charles, “The Growth and Activities of Organised Crime in Bombay.” 
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Government-Sanctioned Sectarian Violence 

Political parties and elements of the national government are known to have supported 

violent actions against certain groups in India. The Hindu nationalist ruling party, the Bharatiya 

Janata Party or BJP, has taken actions against Muslims in the provinces of Gujarat and Kashmir 

that have the effect of promoting and condoning sectarian violence. If the BJP remains in power, 

like-minded transnational groups might begin operating with impunity. The government of India 

currently employs a force of former militants and criminals, the so-called “Special Operations 

Group,” to fight its war in Kashmir. The force has been better known for extortion from innocent 

villagers than for combating militants. Indian government officials also have been implicated in 

the murder of a popular anti-India Kashmiri leader, Abdul Ghani Lone, in May 2002.390

India’s prosecution of military actions also has come into question. According to the 

2001 Human Rights Watch World Report, India’s security forces and unofficial paramilitary 

forces in the Kashmiri conflict have been guilty of “extra-judicial executions, “disappearances,” 

“deaths in custody, torture, and rape,” and the government has not investigated these charges.391

The Indian government has tried to pressure its neighbors and keep them weak through 

the proxy use of militants. Examples of this practice are support for insurgencies such as the 

LTTE in Sri Lanka and the Chittagong Hill rebels in Bangladesh. In such cases, India’s 

neighbors have followed suit when they have had the capability to exploit the presence of 

insurgencies in India. A newer trend in India is support by the Hindu nationalist government for 

domestically rooted sectarian terror against Muslim and other targets.392 In the case of deadly 

riots against Muslim communities in Gujarat Province in June 2002, human rights groups 

contended that much of the violence was planned carefully in advance and carried out with state 

approval and orchestration.393

Nepal 

Nepal’s porous borders and proximity to unstable neighbors recently has made that 

country a growing transit point for illegal trafficking. Trafficking in people for the sex trade is a 

 

390 Rashid and Slater. 391 Human Rights Watch, “World Report 2001.” http://www.hrw.org/wr2k1/ 392 “South Asia,” Jane’s Sentinel Security Assessment:, 3 September 2002. 393 Human Rights Watch, “World Report 2003.” <http://www.hrw.org/wr2k3> 
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chronic problem. According to one estimate, 12,000 Nepalese girls and women are trafficked 

into the sex trade in India annually.394 In the words of one report, “Brothels in the big cities of 

India and Pakistan are overflowing with women and girls from villages in Nepal and 

Bangladesh.”395 The major factors in this situation are the acute poverty that afflicts many 

regions of Nepal, a patriarchal society in which women have subservient status, the caste system, 

and the virtual lack of border controls between Nepal and India. A concentration of busy market 

towns on both sides of the Nepal-India border provides transnational agents and brokers an 

anonymous atmosphere and easy access to transportation.396 A 2001 report identified eight 

primary trafficking routes from Nepal into India. The final destination may be a brothel, a circus, 

or a factory.397 As of late 2002, the government of Nepal had taken no effective action against 

the trafficking problem.398

Narcotics trafficking is an emerging problem in Nepal. Heroin is smuggled across 

Nepal’s open border with India and through Tribhuvan International Airport at Katmandu. Nepal 

lacks adequate security measures to control transit along borders or at the airport. Recent arrests 

of Nepalese couriers may indicate that Nepal’s role is increasing in trafficking to points in South 

and East Asia.399

Pakistan 

In Pakistan, as elsewhere in the region, the line between political and criminal violence is 

becoming obscured. As in Bangladesh, this situation is partly a result of the ready availability of 

arms and the presence of armed party activists who also are engaged in criminal activities. In 

some cases, such groups also have links to terrorist organizations. Pakistan’s distinctiveness in 

this area comes from the well-known and significant role of its intelligence services in backing 

certain terrorist organizations and in furthering the army’s political goals. Combined with a 

 

394 Debra Armentrout, “Child Trafficking Continues to Threaten Young Women in India,” Digital Freedom Network 

report, 15 November 2002. <http://www.dfn.org/news/india/trafficked.htm> 395 Saurabh Bhattacharya, “Sex Workers See Freedom in Rules and Regulations,” Inter Press Service report, 15 

December 1997. <http://www.oneworld.org/ips2/dec/india3.html> 396 Armentrout. 397 International Labour Organization, “Nepal: Trafficking in Girls with Special Reference to Prostitution: A Rapid 

Assessment,” November 2001. <http://www.ilo.org/public/english/standards/ipec/simpoc/nepal/ra/trafficking.pdf> 398 Armentrout. 399 U.S. Department of State, Bureau for International Narcotics and Law Enforcement Affairs, International 

Narcotics Control Strategy Report 2003, VII-18, 19. 
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corrupt and ill-trained police force, these conditions make Pakistan a particularly popular and 

willing host for non-indigenous and indigenous criminal and terrorist groups. 

Terrorism and Destabilization Movements 

Having fought three wars with India in the past 50 years, and being constantly on the 

verge of a fourth over the issue of independence for India’s state of Kashmir, Pakistan views its 

national security as inversely proportionate to India’s strength. Thus, Pakistan’s military and 

intelligence agencies, notably the ISI, focus on destabilizing or otherwise occupying India 

through various means. In Kashmir this has meant supplying and training armed groups 

involved in Kashmir’s nationalist struggle.400 Militant groups trained and armed by the ISI and 

often based in Pakistan have assumed increasing roles in the Kashmir region. Such groups are 

composed mainly of non-Kashmiris and include individuals with ties to the Afghan wars and al 

Qaeda.401 Because repatriation of such groups is a domestic security risk for Pakistan, duty in the 

Kashmir campaign serves as a convenient alternative.402

Beginning in the 1990s, Pakistan has been a key home base for several Islamic extremist 

groups, which have enjoyed substantial support among sectors of the population. Such groups 

benefit from Pakistan’s tribal social structure, which affords substantial regional autonomy and 

impedes law enforcement by central authorities. The groups also reportedly have benefited from 

the protection of the ISI, which earlier had been deeply involved in the sale of drugs to support 

the mujahideen in Afghanistan,403 and from the military, which cultivated the groups as a 

bulwark against India.404

After September 11, the Musharraf government yielded to pressure from the United 

States by beginning repression of several major extremist groups believed to have direct or 

indirect connections with al Qaeda. Those groups included the designated terrorist groups 

Lashkar-e-Tayyaba and Jaish-e-Mohammed and the Jamiat Ulema-l-Islami Islamic religious 

group, one faction of which is aligned with Jaish-e-Mohammed.. The central goal of all three 

 

400 Maseeh Rahman, “Facing into a Storm,” Far Eastern Economic Review, 11 October 2001. 401 Muzamil Jaleel, “Kashmiris Tell Militants to Go,” The Observer, 13 January 2002. 402 "Pakistan," Jane's World Armies, 12 (17 June 2002). 403 Suba Chandran, “Drug Trafficking and the Security of the State: Case Study of Pakistan,” Institute for Defence 

Studies and Analyses [New Delhi] report, 1997. <http://www.idsa-india.org/an-sep8-7.html> 404 Regional expert Ahmed Rashid, cited in John Lancaster, “Reshaping Pakistan along Religious Lines,” 

Washington Post, 20 June 2003, A1. 
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groups is the liberation of Kashmir from rule by India, and all three have been linked to al 

Qaeda.405 The government also began restriction of the curricula of the madrassas (Islamic 

religious schools). Especially in northwestern Pakistan, madrassas taught exclusively an 

extremist version of Islam, to the exclusion of other subjects. A number of terrorist activists 

allegedly had emerged from this system.406 Because of the ISI’s earlier links with terrorist 

organizations,407 however, the commitment of the Pakistani government to ridding the country of 

terrorist organizations has remained unclear. In mid-2003, a coalition of six radical Islamist 

parties constituted the main opposition party to Musharraf’s military government and fully 

controlled Pakistan’s Northwest Province, which borders Afghanistan. The cultural and political 

influence of fundamentalist groups reportedly was increasing in other parts of Pakistan as 

well.408

The ISI has been accused of cooperating with non-indigenous terror groups to destabilize 

India and other neighboring countries. Recent reports claim that the ISI has supported the use of 

Nepal as a base for insurgent attacks in the strategic Shiliguri corridor, which links India’s 

northeast territory with the rest of India.409 

Evidence indicates that gunmen of the Pakistan-based Harakat ul-Mujahidin Islamic 

militant group were involved in the American Cultural Center attack in Calcutta in January 2002. 

The Harakat, which reportedly receives substantial funding from Saudi Arabia, 410 also has been 

accused of links to the radical groups in Kashmir, including the Lashkar-e-Tayyiba and Jesh-eMohammedi, as well as to al Qaeda. The Harakat also may have maintained a presence in 

Afghanistan before October 2001.411 In June 2003, regional expert Ahmed Rashid reported that 

most of the senior leaders of the Taliban had found refuge in Pakistan and were reconstituting the 

 

405 “Lashkar-e-Toiba,” BBC News report, 25 November 2002. 

<htttp://news.bbc.co.uk/2/hi/south_asia/2510613.stm>; and U.S. Department of State, “Jaish-e-Mohammed (JEM) 

(Army of Mohammed),” Patterns of Global Terrorism 2001, cited in Naval Postgraduate School Terrorist Group 

Profiles, 2002. <http://library.nps.navy.mil/home/tgp/jem.htm> 406 U.S. Department of State, Patterns of Global Terrorism 2001. 

<http:www.state.gov/s/ct/rls/pgtrpt/2001/html/10237.htm> 

407 See, for example, Michel Chossudovsky, “The Role of Pakistan’s Military Intelligence (ISI) in the September 11 

Attacks.” <http://globalresearch.ca/articles/CHO111A.html> 408 Lancaster. 409 Jasparro. 410 “South Asia, Internal Affairs,” Jane’s Sentinel Security Assessment, 15 May, 2003. 411 “United Liberation Front of Assam (ULFA).” 
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Islamic fundamentalist movement that United States forces pushed out of Afghanistan in 2001 

and 2002.412

Trafficking Activities 

Pakistan plays an important role in regional arms trafficking. In the 1980s, the country 

was a major conduit of arms from the United States to the mujahideen insurgents fighting the 

Soviet Union in neighboring Afghanistan. According to one estimate, 70 percent of the total 

arms in the conduit were diverted from their intended destination by Pakistan’s ISI, which 

controlled distribution from Pakistan into Afghanistan. Many of those weapons and supplies 

have remained in Pakistan, supporting an abundant, diversified market that has been centered 

around the city of Peshawar. In recent years, that market has supplied several of the insurgent 

groups of South and Southeast Asia, including the Abu Sayyaf and Moro Islamic Liberation 

Front in the Philippines.413 This source also has armed Islamic extremist groups within Pakistan 

and in the disputed territory of Kashmir.414

Pakistan also has played a primary role in the narcotics trade of its region, as a producer, 

a transit country, and a final destination. In the 1970s and 1980s, Pakistan became a center of 

narcotics trafficking because of several factors. Events in Iran and Afghanistan pushed narcotics 

trafficking from those countries eastward into Pakistan. Narcotics earnings also proved an 

effective way for Pakistan to support the mujahideen insurgent groups in Afghanistan against the 

Soviet Union occupation that began in 1979. In the same period, Pakistani narcotics trafficking 

clans gained substantial political power by establishing ties with parties and government and 

army officials, thus protecting the narcotics trade.415 As vigorous government campaigns 

virtually eliminated domestic poppy cultivation in Pakistan by 2001,416 the easy availability of 

heroin from Afghanistan sharply increased addiction rates in Pakistan, maintaining the country’s 

place along the South Asian trafficking routes. Pakistan’s poor drug treatment program has 

 

412 Ahmed Rashid, “America’s War on Terror Goes Awry in Pakistan, Yale Global, 4 June 2003. 413 Peter Chalk, “Light Arms Trading in SE Asia,” Jane’s Intelligence Review, 1 March 2001. 

<http://www.rand.org/hot/op-eds/030101JIR.html> 

414 International Action Network on Small Arms, “Pakistan Begins Major Campaign to Seize Illegal Weapons,” 30 

May 2001. <http://www.iansa.org/news/2001/may_01/pak_beg.htm> 

415 Chandran. 416 U.S. Department of State, International Narcotics Control Strategy Report 2002. 
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allowed this driver to increase domestic demand in recent years.417 The Anti-Narcotics Force, 

Pakistan’s chief narcotics law enforcement agency, suffers from low personnel and funding 

levels, although the agency’s performance improved in 2002.418

Thus Pakistan remains an important transit country for Afghan opiates and hashish. 

Heroin and opium enter across the Northwest Frontier and Baluchistan provinces. Some of these 

drugs supply the local market, and others go on to India via Lahore, Pakistani ports, or Iran.419

Pakistani organized crime plays an important role in financing and organizing opium production 

in Pakistan. Actors involved in the drug trade include the ISI, politicians, and criminals. Among 

major drug traffickers indicted in 2002 were two politicians, one of whom was re-elected despite 

pending drug trafficking charges.420

The events of September 11 prompted the U.S. Department of State to initiate the 

Pakistan Border Security Project to aid Pakistan in controlling its mountainous, notoriously 

porous, 1,450-mile border with Afghanistan, across which narcotics, arms, and terrorist fighters 

(including perhaps Osama bin Laden) have passed virtually without control. Based on that 

program, in 2002 the government of Pakistan began a large-scale border security program, the 

results of which are not yet clear.421

Sri Lanka 

In Sri Lanka, terror and organized crime share largely the same source, the Tamil Tigers 

of Tamil Eelam (LTTE). The LTTE, which has a distinctly transnational dimension, is rated as 

one of the deadliest terror groups in the world. The LTTE finances its insurgency through 

various forms of organized criminal activity, mostly drug and immigrant smuggling. Because of 

its geographic position and easy accessibility by sea and air, Sri Lanka is a convenient transit 

route for drugs moving to Europe from the Golden Crescent and the Golden Triangle. The LTTE 

is heavily involved in both this trade and human smuggling, using the group’s own networks of 

Tamils throughout Europe. Large sections of Sri Lanka are actually under the control of the 

 

417 Nadeem Iqbal, “Drug Abuse Grows on Bumper Poppy Crop in Afghanistan,” Inter Press Service report, 15 

January 2003. <http://www.aegis.com/news/ips/2003/IP030107.htm> 418 U.S. Department of State, International Narcotics Control Strategy Report 2003. 419 “South Asia, Internal Affairs.” 420 U.S. Department of State, International Narcotics Control Strategy Report 2002. 421 U.S. Department of State, International Narcotics Control Strategy Report 2002. 
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LTTE, severely limiting the government’s ability to control crime. Law enforcement resources 

are stretched thin by the government’s campaign against the LTTE insurgency. 

Liberation Tigers of Tamil Eelam (LTTE) 

Although a ceasefire was declared in Sri Lanka’s civil war in December 2001, in 2002 

the U.S. Department of State reported that the LTTE had not yet renounced its use of terror.422

Of the estimated 65,000 people who have died in the civil war that has raged intermittently since 

1983, most were victims of the LTTE. Known for a cadre of suicide bombers called the Black 

Tigers, the LTTE claimed responsibility for the assassinations of former Indian prime minister 

Rajiv Ghandi in 1991 and Sri Lankan President Ranasinghe Premadasa in 1993. The LTTE 

reportedly purchases weapons, raises funds, and propagandizes overtly. Its front organizations 

support LTTE by lobbying foreign governments and the United Nations.423

The LTTE, which is fighting for creation of an independent Tamil state in northern and 

eastern Sri Lanka, uses its control of the strategically vital Jaffna Peninsula to take a percentage 

of all goods smuggled into the country. In addition, the LTTE extorts money and property from 

citizens in the areas it controls. The group has begun supplementing its military power with 

technological weapons; in 2000 the LTTE became the first militant group known to engage in 

cyber warfare when it paralyzed Sri Lankan government websites worldwide and broadcast its 

own political messages over the Internet.424

Organized Crime Activity 

Much of Sri Lanka's growing narcotics traffic from South Asia is controlled by the 

LTTE. Sri Lanka's 1,100 miles of coastline cannot be adequately patrolled because Sri Lanka 

has no coast guard and its naval forces are heavily involved in intercepting arms deliveries to the 

LTTE.425 In June 2000, authorities made a record seizure of 38 kilograms of heroin from a vessel 

 

422 U.S. Department of State, Patterns of Global Terrorism 2002.

<http://www.usis.usemb.se/terror/terror/rpt2002/index.html> 423 U.S. Department of State, Patterns of Global Terrorism 2001. 424 Nirmal Ghosh, “LTTE’s Global Shadow Economy Behind Violence,” The Straits Times, 24 May 2000. 425 U.S. Department of State, International Narcotics Control Strategy Report 2002. 
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sailing from India to Sri Lanka.426 Officials believe that much of the hundreds of pounds of 

heroin seized in southern India each year is bound for Sri Lanka. Large consignments of 

cannabis and heroin from Pakistan are believed to reach Sri Lanka for shipment through 

Colombo International Airport and Sri Lankan seaports to destinations outside the region427

Sri Lanka’s narcotics trafficking is characterized by the cooperation of various national 

groups and by official corruption. A Delhi-based gangster, Ashwin Naik, was implicated in drug 

and extortion rackets with the LTTE before his arrest in 2000. According to a 1999 report, 

similar connections involved Pakistan. Tamils involved in the India-Sri Lanka drug trade were 

not only associates of Naik but also of Ali Khan, a “Pakistani drug lord” who sent consignments 

of heroin across Pakistan’s border with the Indian state of Rajasthan, from where it entered the 

Tamil network at Delhi.428 Two narcotics routes are known to link India, Pakistan, and Sri 

Lanka. The first moves narcotics from Pakistan to Mumbai, where they are packed and sent by 

boat to the ports of Tuticorin or Rameshwaram in Tamil Nadu state at the southern tip of India. 

The second route moves drugs from Pakistan to Delhi via Jaisalmer and Bearmer in Rajasthan, 

whence they are sent overland to Tamil Nadu. Both routes bring the drugs in Tamil Nadu to 

Colombo or Jaffna in Sri Lanka.429

SOUTHEAST ASIA 

The Southeast Asian nations of Indonesia, Malaysia, the Philippines, and Thailand have 

provided valuable services for international terrorist groups and organized crime groups. These 

countries have functioned as safe havens, training grounds, meeting places, money-laundering 

centers, and centers for trafficking in arms, humans, and narcotics. The area is ripe for this kind 

of activity because of its large populations of Muslim minorities (excepting predominantly 

Muslim Indonesia), poor banking transparency, weak border controls, and geographic proximity 

to the Golden Triangle, a region that includes parts of western Burma, northwestern Thailand, 

and China’s Yunnan Province and is the origin of most of the region’s drug supply. Slow 

 

426 U.S. Department of State, Bureau for International Narcotics and Law Enforcement Affairs. International 

Narcotics Control Strategy Report 2001. 427 Asian Harm Reduction Network, “Revisiting The Hidden Epidemic: A Situation Assessment of Drug 

Use in Asia in the Context of HIV/AIDS.” <http://www.ahrn.net/rapidassessment.pdf> 428 Subramanian. 429 Ghosh. 
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economic development and governmental instability add to the mix, as do the bustling tourist 

markets and lax visa laws that lead to relatively unimpeded transnational movement. In 

Indonesia, Malaysia, and the Philippines, discontented Muslim groups provide a friendly 

environment for terrorist activity. Government and corruption, which manifests itself in various 

ways in the region, plays a role in promoting criminal activity in all the Southeast Asian 

countries discussed in this report. Another Southeast Asian nation, Singapore, does not provide 

the same hospitable environment and hence is thought to have become a target, rather than a 

haven, for terrorist organizations.430

Indonesia 

Terrorist Activity 

In the past decade, Indonesia has been a significant target of terrorist acts and the base for 

terrorist groups. A major factor in this situation has been the laxness of the Indonesian 

government in controlling indigenous and foreign terrorist groups, which have found adequate 

shelter in the country’s Muslim population. Constituting about 87 percent of Indonesia’s 212 

million people, Indonesia’s is the largest Muslim population in any country of the world.431

Continued Muslim dissatisfaction over political rule and consistently unstable government 

contribute directly to the ease with which Islamic terrorist organizations are capable of 

permeating Indonesia’s borders. Indonesia’s primary problems have been maintaining internal 

stability and control in the face of separatist movements and direct challenges to its military 

authority by local militias. 

On October 12, 2002, a terrorist bombing in Bali prompted the Indonesian government to 

arrest Abu Bakar Bashir, leader of the radical Islamic Jemaah Islamiya (JI) group. The arrest was 

implicit recognition that the country had pursued a dangerous and unwise policy by turning a 

blind eye to radical organizations.432 After the overthrow of President Suharto in May 1998, JI 

 

430 “Organized Crime Moves into Migrant Trafficking,” Trafficking in Migrants Quarterly Bulletin [Geneva], no. 11 

(June 1996). 

431 Population Resource Center web site. Last viewed December 13, 2002. 

<http://www.prcdc.org/summaries/indonesia/indonesia.html> 

432 John McBeth, “What if He Isn’t Guilty?” Far Eastern Economic Review, 165, no.44 (7 November 2002): 17. 
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leaders had taken advantage of lax anti-terrorist policies by Suharto’s successors to re-establish 

regional operations in Java and the island of Sulawesi, north of Java.433

After the Bali bombing, the Indonesian government identified the increased intervention 

of militant international organizations in Indonesian domestic politics as a major threat to 

national security.434 Leaders of the government, which “realized that it lacked the legal basis to 

deal with terrorism,” issued an emergency anti-terrorism decree immediately after the bombing, 

pending passage of permanent legislation.435 As of December 2002, evidence in the Bali case 

pointed either to direct involvement of al Qaeda operatives in setting the bomb, or to al Qaeda 

direction of JI terrorists who set the bomb.436 JI’s operations chief, Riduan Isamuddin (also 

known as Hambali), reportedly is an elite member of al Qaeda, with responsibility for recruiting 

in Indonesia and arranging Indonesian recruit training in the Philippines and Afghanistan.437 In 

June 2003, a senior member of JI testified that al Qaeda had planned a series of church bombings 

that were carried out in Indonesia by JI at Christmas 2000. This was the first direct 

acknowledgment of ties between JI and al Qaeda.438

In addition to its two operational divisions in Indonesia, the loosely structured JI has 

established two other territorial divisions: one in peninsular Malaysia and Singapore, the other in 

Australia and Papua New Guinea.439 In recent years, Indonesian cells have been involved in a 

war against Christians in Sulawesi and the Moluccas Islands and in attacks on Christian civilians 

in several other locations within Indonesia.440

Contributing Factors 

Analysts cite a lack of political will as the primary reason for the proliferation and 

strength of al Qaeda and other terrorist groups in Indonesia. Prior to the Bali bombing, 

 

433 “Indonesia Backgrounder: How the Jemaah Islamiya Terrorist Network Operates,” ICG Asia Report, no. 43 (11 

December 2002). <http://www.crisisweb.org> 434 Paul Burton, “Behind the Bali Bombing,” Jane’s Sentinel Online, 16 October 2002. <http://www.janes.com> 435 Rudy Madanir and Christine Tjandraningsih, “Indonesia Issues Terror Decree, Arrests Muslim Leader,” Kyodo

[Tokyo], 19 October 2002 (FBIS Document JPP20021019000087). 

436 Ellen Nakashima, “Jailed Indonesian Suspect Details Links to Bombings,” Washington Post, 9 November 2002, 

A15. 

437 McBeth, 19. 438 Alan Sipress, “Bin Laden Named in Asian Terror Plots,” Washington Post, 27 June 2003, A24. 439 “Indonesia Backgrounder: How the Jemaah Islamiyah Terrorist Network Operates.” 440 Jean-Claude Pomonti, “The Terrorist Network Covers All of Southeast Asia,” Le Monde [Paris], 20 December 

2002 (FBIS Document EUP20021220000074). 
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Indonesian officials had been unwilling to crack down on either domestic or international Islamic 

terrorist organizations. The Indonesian government also has lacked the professionalism and 

resources necessary to effectively eliminate such a threat. The Indonesian military and police do 

not have the technological tools and training to detect and track down insurgent groups.441

Military morale and ethics are also damaged by chronically low wages. According to a 2002 

government report, even senior enlisted personnel earn only about US$100 per month.442 In 

addition, Indonesia’s civilian government has not been able to curb corruption and the sale of 

arms and explosives by the army.443 The International Crisis Group has reported possible links 

between Indonesian military intelligence groups and the JI and recommended that anti-terrorist 

measures be enforced by the police rather than the military. 

Indonesia’s policy of suppression of dissident groups has limited much of the 

development of domestic threat. However, The Free Aceh Movement (Gerakin Aceh Merdeka, 

GAM), based near a key international shipping lane on the western end of Sumatra, is a domestic 

insurgent organization that has committed some terrorist acts in the name of regional autonomy. 

Located in Indonesia’s most profoundly Muslim province, the GAM has survived since its 

establishment in the 1970s, despite several years of occupation and harsh counter-insurgency 

operations by Indonesia’s military.444 Although the GAM has not presented a threat to 

Indonesia’s national security or engaged in significant transnational activity, its continued 

presence suggests that Indonesia lacks an effective policy for dealing with dissident groups. In 

mid-2002, Indonesian authorities identified an extensive arms-trafficking network within the 

military that was selling arms to the GAM.445 The GAM also has purchased arms from 

transnational traffickers based in Thailand.446 In December 2002, the GAM, which reportedly 

 

441 John McBeth, “Weak Link in the Anti-terror Chain,” Far Eastern Economic Review, 165, no. 42 (4 October 

2002): 15. 

442 “The Military’s Social Safety Net,” Laksamana [Jakarta], 27 June 2002 (FBIS Document SEP20020702). 443 “Bali Bombing: Rift Emerges Within Jemaah Islamiyah,” ICG News Media Release, 11 December 2002. 

<http://www.intl-crisis-group.org> 

444 Colin Robinson, “In the Spotlight: Indonesia’s Free Aceh Movement,” Center for Defense Information Terrorism 

Project Report, 10 May 2002. <http://www.cdi.org/terrorism> 

445 Wenseslaus Manggut, Edy Budiyarso, and Chandra, “Angry Indonesian Army Chief: Death for Soldiers Stealing, 

Selling Weapons,” Tempo [Jakarta], 25 August 2002 (FBIS Document SEP20020905000036). 446 Suthep Chaiviwan, “Gun Running: Transit to Terror,” Bangkok Post [Bangkok], 14 July 2002 (FBIS Document 

SEP20020714000011). 
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has strongly opposed the JI in Sumatra, signed a peace agreement with the government of 

Indonesia.447

Complicating governance by Indonesia’s civilian leaders is the strength of the state’s 

regional military forces. After the removal of Suharto, the Indonesian military was forced to 

enlist the help of local militias to maintain control of the country and quell separatist factions. 

Since that time, the militias have built up formidable pockets of regional authority that challenge 

state control. Fearing that such organizations could become fully free of civilian control and 

realign themselves with non-indigenous terrorist forces such as al Qaeda, the Indonesian military 

has called for these militias to disband.448 One such militia is the Laskar Jihad, which reportedly 

has received training from al Qaeda and other international terrorist organizations in 

Afghanistan. 

Transnational Crime 

Although insurgent terrorist groups are the primary concern in Indonesia, recent growth 

in drug trafficking also poses a threat. Bali, for example, has seen increasing drug activity. The 

island’s growing tourist economy and the increased number of flights moving in and out of the 

island have contributed significantly to this drug culture. In addition, corruption among civilian 

military officials has afforded protection to traffickers. In the 1990s, arrests for narcotics 

trafficking increased regularly in Bali, but most incidents involved recreational drug use by 

tourists.449 In 2002 authorities also identified large numbers of marijuana smugglers based in 

Aceh, which is Indonesia’s primary marijuana-growing region. Reportedly, those smugglers are 

connected with a transnational narcotics network whose overseas point is Malaysia.450

In 2002 Indonesia’s National Narcotics Agency reported that Indonesia has become the 

world’s third-largest producer of ecstasy. Most ecstasy is exported (Indonesian ecstasy has been 

 

447 “Bali Bombing: Rift Emerges Within Jemaah Islamiyah.” 448 “Indonesia: Bali Bombing Forcing Military to Address Militia Dilemma,” Strategic Forecasting, 8 November 

2002. <http://www.stratfor.biz> 

449 “Officer Describes Bali as Drug Transit Point,” Jakarta Suara Pembaruan, 2 March 1997 (FBIS Document 

FTS19970303000479). 

450 “Marijuana Trafficking Involves International Syndicates,” Medan Analisa [Banda Aceh], 1 May 2002 (FBIS 

Document SEP20020501000096). 
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found in the United States for example), but Indonesia also has a growing domestic market for 

the substance. Tangerang, west of Jakarta, has been identified as a production center.451

Malaysia 

Malaysia, like Indonesia, faces political unrest within its Muslim population. Although 

Malaysia shows little evidence of the same degree of illicit drug trafficking or money laundering 

that is present in Thailand and the Philippines, international authorities place Malaysia high on 

the list of countries to monitor for international terrorist activities and human trafficking. It is 

significant, too, that President Mahathir Mohamad faces political opposition from the PanMalaysia Islamic Party, an organization that has established links to extremist Islamic groups 

inside Malaysia that are sympathetic to the activities of al Qaeda.452

Terrorist Activity 

Reports indicate that Malaysian businessman Yazid Sufaat, who was captured by United 

States forces in Afghanistan, had worked with Muslim terrorist organizations such as al Qaeda 

prior to the September 11th attack on the United States. Sufaat’s company, Infocus Tech, was 

directly involved in exchanging information with al Qaeda operative Zakarias Moussaoui. 

Previous to his work in Infocus, Sufaat was a captain in the Malaysian army and a member of the 

extremist group JI, which is known to be sympathetic to various terrorist groups.453 JI’s 

relationship with al Qaeda has been established throughout Asia in connection with cases such as 

the Bali bombing in Indonesia. 

Terrorist groups are able to easily meet and organize in Malaysia because Malaysia’s 

loose visa regulations for all domestic and foreign Muslims provide easy passage for Muslim 

terrorists.454 In addition, the Malaysian capital, Kuala Lumpur, is a technologically advanced 

city with all the amenities needed for high-speed global communication and the secure banking 

transactions required for international data and money transfer. 

 

451 Radio Australia broadcast, 16 April 2002 (FBIS Document SEP20020416000090). 452 Dan Murphy, “US Pushes Southeast Asian States on Islamic Radicals,” Christian Science Monitor, 93, no. 223 

(12 October 2001): 7.

453 Daniel Klaidman, “A Good Place to Lie Low,” Newsweek, 139, no. 5 (February 2002): 34. 454 Klaidman. 
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Transnational Crime 

In August 2001, Malaysia passed an anti-money laundering act.455 Although no reports 

indicate that Malaysia has a particular problem with money laundering, the existence of a strong 

sex trade and the activities of international terrorist groups within its borders are at least 

preliminary conditions for significant money laundering activity. 

Malaysia’s lax visa laws also promote human trafficking. Currently, Malaysia serves as a 

receiving country for women trafficked from most other Southeast Asian countries.456 Because 

trafficking in humans for the sex trade and for illegal immigration is lucrative, international 

organized crime organizations have become deeply involved in Malaysia’s global trafficking 

rings.457 Although little evidence indicates the physical presence of non-indigenous organized 

crime rings within Malaysia, domestic crime groups cooperate in transporting immigrants to 

these groups internationally. Malaysian criminals also cooperate with international organized 

crime groups in countries such as the Philippines and Vietnam in the recruiting and abduction of 

women destined for Malaysia’s illicit sex trade.458 Although prostitution is illegal in Malaysia, 

corrupt members of the Mahathir government reportedly have been complicit in supporting the 

industry.459

Philippines 

The Philippines hosts a variety of international organized crime and terrorist groups not 

unlike those found in other Southeast Asian countries. Among the foremost problems are human 

trafficking, money laundering, narcotics, and the presence of four domestic radical separatist 

groups, at least one of which has links to al Qaeda. With the exception of groups engaged in 

human trafficking and corrupt political officials, illegal activities in the Philippines appear to 

have the single purpose of supporting the Muslim separatist movements and Osama bin Laden’s 

terrorist network. 

 

455 Mary Swire, “New Malaysian Money Laundering Act Now in Force,” Tax-News [Hong Kong], 28 August 2001. 

<www.tax-news.com> 

456 “A Human Rights Report on Trafficking of Persons, Especially Women and Children,” The Protection Project, 

March 2002, 341. 

457 Rina Jimenez-David, “Sex Abuse and Sex Trafficking in Malaysia,” Asia Intelligence Wire: Financial Times, 5 

September 2002. 

458 “A Human Rights Report on Trafficking.” 459 Jimenez-David. 
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Terrorist Activity 

The Philippines has been an ideal hideout and training ground for terrorist insurgents 

from al Qaeda and JI because of its rugged terrain and multiplicity of uncontrolled islands.460 

Furthermore, the Philippine legal system is not geared to enforcing international law or 

protecting against transnational crime. Loopholes in that system frustrate the efforts of Philippine 

police to prosecute non-indigenous insurgent groups.461

The four radical separatist groups are Abu Sayyaf, the Communist New People’s Army, 

the Moro Islamic Liberation Front (MILF), and the Moro National Liberation Front (MNLF). 

The first three have been linked to terrorist acts. The MNLF is considered the most moderate of 

the four. Abu Sayyaf is based in the jungles of the southern islands of the Philippines, the 

Communist New People’s Army in the center of the country. Although experts believe that 

geographical and ideological differences preclude lasting alliances, all three are known to have 

cooperated with one of the others in specific terrorist attacks. Filipino authorities attributed an 

assault on a Philippine Army headquarters in November 2001 to the MILF and Abu Sayyaf. 

Most recently, a terrorist attack in Zamboanga del Norte was described as a coordinated effort 

between the MILF and Abu Sayyaf. Explosions in Davao City in March and April 2003 have 

been called a combined attack by the Communist New People’s Army and Abu Sayyaf.462

Al Qaeda established a presence in the Philippines in 1987, when leader Osama bin 

Laden’s brother-in-law Jamal Khalifa established a business front, called Benevolence 

International, to funnel money to insurgent groups.463 Reportedly, Khalifa assisted in the 

founding of the Abu Sayyaf, a terrorist gang known especially for kidnapping tourists and 

politicians for ransom. The Philippines has been, and may continue to be, a major training 

ground for al Qaeda operatives and a haven for refugees from the Russian invasion of 

Afghanistan. Abu Sayyaf leader and founder Abdurajak Jalanjani was trained by Osama bin 

Laden in Afghanistan. Ramzi Yousef, who masterminded an attack on the World Trade Center in 

 

460 Ricardo Tiuseco Pamintuan, “Country Paper on Effective Methods to Combat Transnational Organized Crime in 

Criminal Justice Processes,” UNAFEI Resource Material Series 58 [Tokyo], December 2001. <www.unafei.co.jp> 461 Pamintuan, 184. 462 “Philippines: Rebel Alliance or Aid Ploy?” Stratfor report, 8 May 2003. 463 Jean-Claude Pomonti, “Al-Qa’ida’s Invisible Presence in Southeast Asia,” Le Monde [Paris], 1 November 2001, 

12 (FBIS Document EUP20011112000434). 
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1993, is known to have trained al Qaeda and Abu Sayyaf members in the creation and use of 

explosives while hiding out in the Philippines.464 Although most reports indicate that by 2002 

Abu Sayyaf had become nothing more than a gang of kidnappers, a recent report by domestic 

financial investigators stated that a portion of the kidnapping ransoms obtained by the Abu 

Sayyaf is being laundered in Manila and being redistributed to al Qaeda.465 In addition, reports 

from the Moro National Liberation Front indicate that local al Qaeda operatives continue to train 

members of Abu Sayyaf.466

Transnational Crime 

Although Islamic extremist groups are able to launder money through the hawala 

system,467 the lack of transparency in the Philippines financial system also permits money 

laundering through the national banking system. In October 2002, responding to the loophole, 

the government adopted an anti-money laundering law designed to reduce this source of funding 

for terrorist and international organized crime organizations. The new law was adopted after a 

special joint meeting of fifteen European Union (EU) member states released an ultimatum 

demanding that the Philippines and several other countries reduce the flow of “dirty money” 

through their banks. Possible sanctions would include restricting EU banks from opening 

branches in the Philippines.468 The new law requires banks to open the accounts of suspected 

launderers for investigation.469

Some of the illegal funds flowing through the Philippines stem from the sale of narcotics. 

The drug trade in the Philippines is mainly limited to methamphetamines known as shabu, and 

“ice.” The Philippines is at the end point of an international narcotics ring that traffics most of its 

illicit drugs from China and Hong Kong for domestic use rather than for transport to other 

 

464 Alan Dawson, “Al-Qaeda Links Run Deep,” Bangkok Post [Thailand], 29 May 2002 (FBIS Document 

SEP2002529000048). 

465 Dawson. 466 Dawson. 467 Patrick M. Jost, “The Hawala Alternative Remittance System and Its Role in Money Laundering,” Interpol 

report, January 2000. <http://www.interpol.int/Public/FinancialCrime/MoneyLaundering/hawala/default.asp> 468 “EU to Target Philippines, Nauru in Money-Laundering Crackdown,” Agence France Presse [Paris], 12 October 

2001 (FBIS Document EUP20011012000252). 

469 Aurea Calica, “Analysts say Philippines’ Anti-money Laundering Law ‘Lacks Teeth,’ The Philippine Star 

[Philippines], 1 October 2002 (FBIS Document SP20011001000034). 
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countries.470 Chinese drug traffickers (generally members of the mainland Chinese gangs 14K 

and Big Circle) sell shabu to native Filipino dealers out of Manila.471

The predominance of Chinese nationals in Philippine drug trafficking has led the 

Philippine and Chinese governments to initiate a cooperative effort to stem all organized crime 

activities, including human trafficking, terrorism, money laundering, and narcotics trafficking.472

In late 2001, reports of corruption raised suspicion that Senator Panfilo Lacson and the 

Philippine Department of Justice had links to Chinese and Hong Kong organized crime 

syndicates trafficking drugs in the Philippines. Although it is not clear to what degree the 

corruption exists, Colonel Victor Corpus, chief of the Intelligence Service of the Armed Forces 

of the Philippines (ISAFP), has reported that Lacson maintains bank accounts in the United 

States, Canada, and Hong Kong estimated to value over US$1 billion.473 Corpus has found proof 

that senators, including Lacson, have had dealings with Chinese drug lord Kim Wong and other 

Chinese Triad members.474

Trafficking in humans is also widespread in the Philippines. Organized crime syndicates 

from Malaysia and China have been successful in transporting women from their countries to 

destinations in the West via the Philippines, and Filipino women to customers in the international 

sex trade. In September 2001, immigration officials captured Chinese national Chung Chee Hui, 

a suspected leader of a smuggling ring that utilized false documents and passports to export 

Chinese women to other countries.475 The trafficking, however, is not limited only to the sex 

trade. A human trafficking operation exposed in France utilized the valid passports and working 

visas of Filipinos living in Europe in a process that enables Filipino men and women to enter 

Western countries.476

 

470 Mustafa Abdullah, “Analysis of Current Situation on Illicit Drug Trafficking,” UNAFEI Resource Material 

Series [Tokyo], 58 (December 2001). <http://www.unafei.co.jp> 471 Mercedes Rullan, “Five ‘Big Circle’ Members Arrested, P116-M Shabu Recovered,” Manila Kabayan

[Philippines], 23 December 2001 (FBIS Document SEP20011223000011). 472 Perseus Echeminada, “Lina: RP-China Anti-Crime Cooperation in the Works,” The Philippine Star [Manila], 25 

December 2001 (FBIS Document SEP20011225000035). 473 Maritess N. Reyes, “Philippines on Its Way to Becoming a Narco-state,” Intersect Magazine, 27 November 2001. 

<http://www.cyberdyaryo.com/features/f2001_1127_03.htm> 474 Amando Doronila, “The Senate—the Nation’s Laundry Machine,” Philippine Daily Inquirer [Manila], 24 August 

2001 (FBIS Document SEP20010824000031). 

475 “Chinese National of Human Smuggling Syndicate Nabbed in Cebu,” Philippine Star [Manila], 4 September 

2001 (FBIS Document SEP20010904000063). 

476 “Human Trafficking Syndicates’ Scheme in Smuggling Filipinos to Europe Uncovered,” Philippine Daily 

Inquirer [Manila], 27 June 2002 (FBIS Document SEP20020627000090). 
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Contributing Factors 

The proliferation of trafficking in humans is the result of both economic and social 

problems. Poor living conditions and the lure of better lives overseas contribute to the “push” 

factor of human trafficking, creating a steady pool of candidates for export. Researchers have 

also identified social reasons for participation. A 2001 Belgian study on the trafficking of 

women from the Philippines reported factors such as the patriarchal social system and the status 

conferred by society on families with members working overseas as two of the major 

contributors to human trafficking. Moreover, the nation’s loose emigration laws and the low cost 

of employing such emigrants in Western countries are also large factors.477 The Sri Lanka-based 

Tamil Tigers terrorist organization, which has come to see human trafficking as a source of 

income comparable in profitability to narcotics, has been active in transporting undocumented 

Sri Lankans into the Philippines. Such individuals later become wards of the state or move on to 

other countries as refugees.478 The funds received from these activities are laundered and then 

funneled back to Sri Lanka to aid in the secessionist movement.479

Issues of governance have helped to maintain the illicit Philippine economy. Not only is 

the Philippine government lax in its enforcement of the law, but the language of existing laws is 

not easily applicable to conditions created by transnational organized crime and terrorist threats. 

The Philippine government has been linked with corruption and may lack the political will to 

apply obscure legal procedures when political patronage is commonplace. Also, the governing 

system lacks an appropriate prosecutorial agency to investigate and try the offenses of 

transnational criminal groups and terrorists. Finally, at the lowest level of law enforcement, the 

system does not provide appropriate training for officers investigating instances of such 

activity.480

 

477 Brice De Ruyver and Koen Van Heddegem, “Human Trafficking Between Belgium and the Philippines,” 

Tijdschrift voor Criminologie [Amsterdam], 10 January 2001 (FBIS Document EUP20020823000403). 478 Rey Arquiza, “Tamil Guerrillas in Philippines Engage in Raising Funds for War in Sri Lanka,” The Philippine 

Star [Manila], 16 August 2000 (FBIS Document SEP20000816000040). 479 Arquiza. 480 Pamintuan, 183. 
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Thailand 

Geographical location in the Golden Triangle (the tri-border region renowned for illicit 

drug production) and on Burma’s eastern border makes Thailand a prime narcotics trafficking 

route for heroin and methamphetamines. Thailand also is a center for trafficking in humans, 

money laundering, arms smuggling, and document forgery. Thailand is technologically 

advanced enough to provide the communications and transportation infrastructures that 

increasingly are a requirement for the transnational activities of terrorist and transnational 

organized crime groups. In addition, long-established, widespread corruption among Thai 

government officials and the police eases greatly the operating conditions of crime syndicates 

and terrorist organizations. 

Transnational Crime 

Most of Thailand’s criminal activities are conducted in conjunction with its illicit drug 

trade, which in turn spurs money laundering and arms trafficking.481 In 1984 a crackdown on 

heroin trafficking routes throughout the country made Thailand less hospitable to heroin. 

However, since that time methamphetamines have continued to stream across the Burma border, 

via more obscure routes into Bangkok, in the form of an ”ant army” of large numbers of 

traffickers each carrying small amounts of narcotics.482 Sources indicate that Thailand is 

currently Asia’s largest consumer of amphetamines. Its most popular domestic drug is a cheap 

street drug referred to as yaabaa (mad pill) previously known as yaamaa (horse pill).483 

Although yaabaa is manufactured mainly by domestic organizations or separatist groups from 

Burma, evidence shows that international organized crime groups from China increasingly are 

involved in the transport and sale of amphetamines to the Thai narcotics industry. The most 

prominent of these syndicates are the Chinese triads known as 14K and the Wa family, who 

utilize Bangkok as a commercial and trafficking base.484 Although the bulk of the yaabaa that 

 

481 Pasuk Phongpaichit, Guns, Girls, Gambling, Ganja: Thailand’s Illegal Economy and Public Policy (Bangkok: 

Silkworm Books, 1998), 248-49. 

482 Pierre-Arnaud Chouvy, “New Drug Trafficking Routes,” Jane’s Intelligence Review, 1 July 2002. 483 Pierre-Arnaud Chouvy, “Drugs and War Destabilize Thai-Burma Border Region,” Jane’s Intelligence Review, 1 

April, 2002. 

484 King-O Laohong, “Foreign Mafias Take Over Rachada Road Areas as Place to Launder Money and Carry Out 

White Slavery and Narcotics Trafficking, ” Bangkok Krungthemp Thurakit [Bangkok], 4 November 2001 (FBIS 

Document SEP20011105000049). 
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comes into Thailand originates in Burma, Chinese drug syndicates are also reportedly 

responsible for the actual sale of drugs on the streets of Bangkok.485

A large part of Thailand’s narcotics industry is wrapped in a centuries-old conflict with 

Burma. Starting in the 16th century and continuing through the 1999 seizure of the Burmese 

consulate in Bangkok, cooperation between the two countries has been virtually non-existent.486 

The lack of cooperation has resulted in only limited success in stemming the flow of 

methamphetamines manufactured in Burma into Thailand. Compounding the issue is the fact 

that internal conflict between the current ruling party and Burma’s pro-democracy ethnic 

minorities consistently spills into Thai territories. Since both the parties manufacture 

methamphetamine for the Thai drug trade to raise funds for the purchase of arms, both forces 

(the current ruling junta and the insurgents) stand to gain little by fully participating in a 

crackdown on the illicit drug trade through Thailand.487

Reports also indicate that the Thai government also may covertly support the sale of 

narcotics and arms to select insurgent groups in Burma. At the very least, the junta ruling Burma 

has alleged that the Thai government turns a blind eye to arms and narcotics smuggling 

conducted by pro-democratic forces such as the Shan (an ethnic group whose activities are based 

near the Thai border) in an indirect attempt to overturn political authority in Burma.488 

Conversely, Thai and U.S. officials have accused the ruling junta of the same activities in 

Thailand utilizing the United Wa State Army (USWA). USWA is a militant Burmese group that 

occupies the area near the Thai border, and is currently supported by the junta to combat prodemocratic minorities residing in Burma.489 More recently, Thailand has responded to the 

increase in trafficking by strengthening its anti-narcotics unit and establishing anti-trafficking 

posts along the border, and has begun working with the current leadership of Burma to curtail 

illegal activities.490 As of December 2002, the two sides were at least superficially working 

together to reduce the amount of drugs trafficked from Burma into Thailand.491 However, a 

 

485 Chouvy, “New Drug Trafficking Routes.” 486 Roger Mitton, “Myanmar-Thailand Relations: Still Lousy After All These Years,” Asiaweek, 19 October 1999. 

<http://www.asiaweek.com/asiaweek/intelligence/9910/19/> 

487 Shawn Crispin, “Drug Tide Strains Ties,” Far Eastern Economic Review, 162, no. 36 (September 9, 1999): 25. 488 Phongpaichit. 489 Chouvy, “Drugs and War Destabilise Thai-Burma Border Region.” 490 Phongpaichit, 37. 491 “Burma, Thailand Draw Up Joint Plan to Fight Drugs,” Agence France-Presse [Paris], 14 December 2002. 

<http://www.clarinews.net> 
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history of ill will and openly hostile rhetoric between the two parties does not bode well for 

successful cooperation. Even with the best of governmental intentions, the porosity of the 

borders and the multitude of established trafficking routes through Thailand combine with the 

political instability of neighbors such as Burma to stymie efforts to eliminate the drug trade. 

As a regional air transportation hub, Bangkok also functions as a transit base for the 

smuggling of arms and illegal immigrants. The Liberation Tigers of Tamil Eelam (LTTE) 

utilizes the city as a transit point en route to Sri Lanka.492 The LTTE continues to procure arms 

from arsenals abandoned after Cambodia’s civil war and via Cambodia from sources in the 

Chinese military. Although Cambodia’s lack of a strong police force and judicial system makes 

that country ideal for arms trafficking, Thailand is the lynchpin of the LTTE network. It serves 

as such because of its proximity to Sri Lanka, the Bay of Bengal, Burma, and Cambodia; its 

strong communications infrastructure; and the ease with which one can cross its borders.493 

According to sources, bribery of border officials is standard procedure.494

Arms trafficked through Thailand reach customers in several countries. According to a 

2002 Bangkok newspaper report, “Most of the rebel groups in foreign countries, both near and 

far from Thailand, who are engaged in armed insurgencies against their governments, continue to 

order second hand supplies and war weapons from gunrunners along the borders of Thailand.”495 

Among the buyers are groups in Bangladesh (the Chittagong Hill and Chakma groups), 

Indonesia (the GAM), northeastern India, the Andaman Islands, and at least four insurgent 

groups in the Philippines. Some arms arrive in Thailand by sea from the Chinese plants Norinco 

and Poly Technology. Land routes cross into Thailand from Cambodia and Laos, and sea routes 

cross the Gulf of Thailand from the Cambodia-Thailand border to points in southern Burma. As 

of mid-2002, Thailand’s Counter-Terrorism Operations Center was unable to foresee what paths 

arms shipments would follow. In recent years, some of Thailand’s arms trafficking groups have 

expanded or shifted entirely into narcotics trafficking.496

 

492 “Special Report—Case Study: The Liberation Tigers of Tamil Eelam,” Jane’s Intelligence Review,” 1 October 

2001. <http://www.janes.com> 

493 Anthony Davis, “Tamil Tigers Continue Procurement,” Jane’s Intelligence Review, 1 May 2002. 

<http:\\www.janes.com> 

494 Suthep Chaiviwan, “Gun Running: Transit to Terror,” Bangkok Post [Bangkok], 14 July 2002 (FBIS Document 

SEP20020714000011). 

495 Chaiviwan. 496 Chaiviwan. 
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The trafficking of women and illegal aliens into and through Thailand also is a highprofit industry that has attracted transnational and domestic organized crime networks. 

Organizations such as the Japanese Yakuza have an established presence in Bangkok, through 

which they obtain women for Japan’s sex and entertainment trade.497 After international 

attention led to a crackdown on Thailand’s Japanese-run sex tours in the 1980’s, Yakuza groups 

began bringing prostitutes, mainly from Southeast Asian nations, to Japan to continue business. 

The women are smuggled out of Thailand using fake passports produced in Thailand or by 

bribing local police. 498 Lax visa laws make it easy for organized crime organizations such as the 

Yakuza to traffic women into Japan with forged documents.499

Several foreign gangs are known to be involved in the smuggling of illegal immigrants. 

The Chinese “Piglet Gang” and the South Asian “Baby Goat Gangs” (mainly from Bangladesh, 

Pakistan, and Iran) use Thailand’s wealth of false and stolen passports to transport immigrants 

from their home countries to wealthier countries such as the United States and Canada. 

Similarly, the Chinese Wang Kao Niu Gang smuggles Chinese women from locations in China 

to Bangkok to work as prostitutes.500 In similar cases, loose visa regulations and fake passports 

permit illegal aliens to transport people from the Middle East to Western countries by utilizing 

fake Indian and Bangladeshi documents.501

International organized crime syndicates operating from Bangkok long have utilized 

Thailand’s banks and shops to launder profits from narcotics, the sale and transport of humans to 

prostitution rings, and trafficking in illegal immigrants. Thailand’s cities offer criminals and 

terrorists varying opportunities to launder funds from illicit activities. Those engaged in money 

laundering can simply carry large amounts of cash with them as they travel and deposit their 

money in local banks that maintain discretion in business matters. Front companies and wire 

transfers also offer protection for laundering operations.502

 

497 Melanie Orhant, “Human Trafficking: Gangs Make Thailand a Regional Hub: Yakuza Operating,” Stop Traffic 

News, 22 September 2000. <http://www.friends-partners.org> 498 Kinsey Alden Dinan, “Trafficking in Women from Thailand to Japan,” Harvard Asia Quarterly, 6, no. 3 

(Summer 2002). < http://www.fas.harvard.edu/~asiactr/haq/200203/index.htm> 

499 Melanie Orhant, “Abused Thai Women ‘Trafficked’ to Japan Need Help,” Stop Traffic News, 24 September 

2000. <http://www.friends-partners.org> 

500 Laohong. 501 Chaiyakorn Bai-ngern, “Thai Police Investigate Three Alien-Smuggling Gangs,” The Nation [Bangkok], 9 June 

1999 (FBIS Document FTS19990608002032). 

502 Pisan Mookjang, “Current Situation and Countermeasures Against Money Laundering in Thailand,” UNAFEI 

Resource Material Series 58 [Tokyo], December 2001. <www.unafei.co.jp> 
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As of mid-2002, Thailand’s Criminal Procedure Code and money-laundering law 

contained serious flaws that prevented effective action against terrorist organizations. As the law 

stands, terrorism is not a criminal offense, and the national Anti-Money Laundering Office does 

not have the authority to investigate or block the transfer of funds to finance terrorism.503 

Although the national parliament has discussed improvements, the enactment of meaningful 

reforms has proved politically complex. 

Terrorist Activities 

Reports confirm that prominent Islamic terrorist networks also utilize Bangkok as a 

center for false documents and passports.504 As an increasingly cosmopolitan city, Bangkok 

offers both the level of technology required for document falsification and an abundance of 

authentic passports that can be altered to suit the needs of terrorist networks.505 One report 

indicates that false documents are usually transported to Pakistan where they are distributed to 

Islamic terrorist groups and individuals to facilitate global travel. The reports also indicate that 

these passports generate money that is funneled into those same organizations. According to the 

Bangkok police, the groups involved in the purchase and distribution of such passports include al 

Qaeda and Hizballah.506

Singapore 

Despite the arrest of 15 purported terrorists in December of 2001, some of which had 

been trained by al Qaeda in Afghanistan, Singapore generally has not exhibited conditions 

hospitable to transnational organized crime or terrorist groups. JI and al Qaeda cells in 

Singapore are believed to have targeted Singapore for attack rather than utilizing it as a safe 

haven or for financial gain.507 Singapore’s intelligence agencies are well equipped with 

sophisticated technological machinery and well-trained officers to counter the international 

 

503 Surath Jinakul and Songpol Kaopatumtip, “Towards a Terror-Free Thailand,” Bangkok Post [Bangkok], 2 June 

2002 (FBIS Document SEP20020602000027). 

504 “Malaysian Police Say Islamic Militants ‘May Be Hiding on Thai Soil,” The Nation, 22 September 2001 (FBIS 

Document SET20010922000003). 

505 “Thailand Source of Fake Passports,” Bangkok Post, 21 June 2002. <http://scoop.bangkokpost.com> 506 “Thailand Source of Fake Passports.” 507 Rohan Gunaranta, “The Singapore Connection,” Jane’s Intelligence Review, 1 March 2002. <www.janes.com> 
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threat. Singapore authorities disclosed that intelligence operatives had been observing the cells 

for a long period and knew of their al Qaeda links. 

Singapore operates against organized crime networks almost as efficiently as against 

terrorist groups. To prevent the development of crime networks, the government engages in 

what it calls preventative detainment of secret society leaders. Although this practice is 

questionable in terms of human rights, the results contrast strongly with the political and social 

instability of neighboring states.508 Singapore maintains tight control over its borders and 

controls its public through strict laws and regulations. The low drug addiction rate in Singapore 

is attributed directly to the mandatory death penalty for drug traffickers.509

WESTERN EUROPE AND TURKEY 

Introduction: Conditions in Western Europe 

As a region, Western Europe has adopted sophisticated multinational law enforcement 

systems that provide a distinct advantage in dealing with transnational criminal organizations and 

terrorist groups. Nevertheless, Western Europe’s geographic location, its approach to 

transnational law enforcement, and its advanced infrastructure have continued to make it an 

attractive base for transnational crime and terrorist groups. Within the region, specific countries 

have exhibited conditions favoring particular types of illegal activity. For example, Belgium and 

the Netherlands, which have extremely active seaports and relatively lax cargo inspection 

procedures, have provided opportunities for the trafficking of narcotics, gems, and arms. Spain, 

whose geographic location makes it a “gateway” to Europe from the Atlantic Ocean and whose 

ethnic composition gives it a natural connection with Latin American traffickers, has acted as a 

major transit country for narcotics from South America. And the banking systems of Cyprus and 

Monaco are favorable for transnational money laundering activities. Before addressing 

conditions in specific countries, the following paragraphs discuss regional conditions favorable 

to transnational crime and/or terrorism. 

Although there is a growing convergence between terrorist and conventional criminal 

groups, authorities in Western Europe have treated the activities of the two types of group quite 

 

508 “Singapore: Internal Affairs,” Jane’s Sentinel Security Assessment Southeast Asia, 8 July 2002. 

<www.janes.com> 

509 “Singapore: Internal Affairs.” 
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differently. The activities of organized crime groups (extortion, money laundering, 

counterfeiting, smuggling, racketeering, and trafficking in arms, narcotics, and people) have been 

prosecutable offenses that in most cases have carried high penalties. On the other hand, the 

activities of non-indigenous terror groups in Western Europe more commonly comprise fundraising, recruiting, planning, and the dissemination of propaganda. The emphasis on personal 

liberties by democratic governments in Western Europe has provided leeway for such activities. 

In many cases, the profits of operating a criminal organization in Western Europe 

outweigh the difficulties. By comparison with essentially ungoverned areas such as Somalia and 

parts of Central Asia, law enforcement poses a substantial obstacle in Western Europe. However, 

Western Europe also offers the markets that are necessary for a range of high-level financial and 

trafficking crimes to be profitable. The relative profitability of markets in that region is 

illustrated by cocaine prices. According to a 2001 study, the price per kilogram of cocaine rises 

from US$2,000 at its point of origin in Colombia to US$22,500 in Spain and to $42,000 in the 

United Kingdom.510

Another attribute of Western Europe holds the same attraction for criminal groups as it 

does for legitimate businessmen: well-oiled modernity. Arms trafficking expert Paul Eavis has 

written: “As crime becomes more ‘business-like,’ it not only becomes more difficult to detect, 

but criminal groups also profit from many of the conditions and systems established to facilitate 

legal business, including the Internet and e-commerce channels.”511 Other factors that facilitate 

the establishment of organized crime in Western Europe are existing immigrant communities, 

police and official corruption, and existing indigenous crime groups. 

In recent years, some changes have occurred in West European organized crime. 

Organizations still depend on the existence of corrupt law enforcement agents, black markets, 

and unemployment and on time-tested measures such as blackmail and murder.512 However, 

networks have become much more amorphous and ad hoc, and locations and memberships 

change more quickly. In this way, the crime organization operates more in the manner of a 

multinational corporation than a clan-based grouping. Various players own and operate various 

 

510 Christopher Aaron, “Globalisation and Organised Crime,” Jane’s Intelligence Review, 1 December, 2001. 511 Paul Eavis, “The Hidden Security Threat: Transnational Organized Criminal Activity,” RUSI Journal, 146, no. 6 

(December 2001): 36-37. 

512 Alex Schmid, “Troubled Lands Where Criminals Are King,” UNESCO Courier, 54, no. 2 (February 2001). 

<http://www.unesco.org/courier/2001_02/uk/doss8.htm> 
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links on the chain, and their cooperation blurs the distinction between indigenous local groups 

and non-indigenous international groups. Albanian groups, for example, have been trained by the 

Turkish mafia and now are entering the territory of Italian and Russian groups as facilitators of 

smuggling routes.513 In contemporary West European organized crime, few groups are confined 

to a local context. 

The European Union’s plan to create an internally borderless economy, where citizens 

can move their goods, services, and money freely throughout the region, has been instrumental in 

creating new opportunities for criminal groups. The Schengen Agreement officially lifted 

internal European borders (the United Kingdom and Ireland, which are not full members of that 

accord, retain their border controls) and established a common visa policy. Yet immigration 

policies were not accompanied by a harmonization of law enforcement policies. Law 

enforcement officials can pursue a suspect across a national frontier, but if German police, for 

example, wish to seize assets held by a suspected criminal in Belgium or stop a drug shipment 

they believe is headed for Belgium, they need approval from a Belgian court. This is a layer of 

bureaucracy that criminals do not face in doing cross-border deals, and the bureaucratic waiting 

period can allow criminals to slip past law enforcement authorities. As a result of these 

conditions, a Stratfor report concluded in 2003: “....for IOC [Italian organized crime] groups and 

organized criminal enterprises from other European Union countries, the so-called ‘Schengen 

Area’ of borderless EU states has become the most important criminal market on the planet.”514

As the Schengen Agreement lifted border controls among member countries of the EU, it 

toughened controls along the exterior borders of those countries. The increased difficulty of 

entry from outside the community raised demand for illegal paths of entry. As trafficking groups 

adjusted to these changes, the human trafficking activity that targets Western Europe has become 

a more sophisticated and complex operation. According to Mark Baynham of the United 

Kingdom’s National Criminal Intelligence Service, groups involved in human trafficking study 

their markets, identify customers, put together asylum packages, and promise legal and 

employment assistance to migrants. Criminal activity supporting human trafficking includes 

forgery, money laundering, and official corruption. According to Baynham, the price for 

smuggling a person from Turkey to the United Kingdom ranges from US$1,500 to US$4,500, 

 

513 Eavis. 514 “Italy: Organized Crime Groups Expand Influence,” Stratfor report, 9 May 2003. 
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and the price from China to the United Kingdom is about US$30,000. Major trafficking routes 

run from the major hub in Turkey through the Mediterranean Sea, including points in Greece, 

Italy, and France.515

To deal more effectively with transnational crime, the concept of the European Arrest 

Warrant was introduced in 2001. The program, which would make an arrest warrant in one 

European Union country automatically valid in all the others, has met substantial political 

resistance, especially in Italy. Although implementation is scheduled for January 2004, the 

parliaments of all countries must ratify legislation before that step can be taken. Other new 

multinational institutions such as the European Anti-Fraud Office and Eurojust, a justice system 

paralleling the multinational Europol law enforcement agency, have been introduced since 

2000.516 A joint border force also is under consideration, and Italy and Greece have reached 

agreements with Albania to set up a special anti-trafficking center in that country. 

Before September 11, the lenient policies of most European governments toward nonindigenous terror groups was a major attraction for militant groups outlawed in their own 

countries. Until very recently, neither the North Atlantic Treaty Organization (NATO), the EU, 

nor the Council of Europe had outlawed groups such as the Kurdistan Freedom and Democracy 

Congress (KADEK, formerly the Kurdistan Workers Party, PKK) that other countries had 

labeled as “terrorist.” The EU compiled a list of terrorist organizations only in December 2001, 

and the resulting list contained only 12 groups and 30 individuals. The list has subsequently been 

expanded, and EU legislation calls for the 15 member countries to freeze the assets of individuals 

and groups on the list and render assistance to co-members in gathering information to prosecute 

accused terrorists. The new anti-terrorism legislation may mitigate Europe’s reputation as a safe 

haven for terrorists. 

Belgium 

Belgium occupies a prominent place in both the terror and criminal networks of Western 

Europe. There have been indications of ambivalence among government officials toward the 

international anti-terrorist campaign that was launched after September 11, 2002. A senior 

 

515 Aaron. 516 Transparency International, “Global Corruption Report 2003.” 
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Belgian minister was quoted in 2002 as saying, “Bin Laden’s war is against America, not us.”517

A Belgian member of parliament described Belgium’s appeal as a base of operations: “We are 

not a target, but we are such a quiet country that we could be a good preparation country.”518

According to a 2002 confidential report, terrorist organizations such as al Qaeda, the Armed 

Islamic Group (GIA) of Algeria, the Wahabi Tabligh, and the militant GIA splinter group called 

the Salafist Group for Preaching and Combat (GSPC) have established logistical support bases 

among the 350,000 Muslim inhabitants of Belgium. Reportedly the Saudi-backed Salafi 

movement has established a “state” in Belgium, which has its own Islamist police.519

Conventional crime also has found a comfortable home in Belgium. United Nations arms 

specialist Johan Peleman has speculated that the status of Antwerp as an international diamondtrading center and Belgium’s post-colonial ties with Africa made Belgium a major armstrafficking center during the Cold War. According to Peleman, the infrastructure established at 

that time now has fallen into the hands of private individuals and groups. Africa is the source of 

diamonds used in payment and the main marketplace for illegal arms shipments by these 

entrepreneurs.520 Until 2000, Belgium was the primary weapons source for the ETA, and it has 

been a staging point for high-volume arms smugglers such as Victor Bout, Leonid Minin, and 

Jacques Monsieur. Bout used Ostend, Belgium, as his base of operations until 1997, Minin was 

based in northern Italy and used documentation from Belgium, and Monsieur was based in 

Belgium and used documentation from Belgium.521 Although Bout has been described as a 

“merchant of death” and continues arms trafficking operations from his base in Bahrain, the 

international warrant for his arrest issued by Belgian authorities in early 2002 is not for arms 

crimes but for passing counterfeit currency. This fact may point to another reason that Belgium is 

favored by criminal groups: the judicial system is notoriously slow, allowing criminals to stay 

several steps ahead of law enforcement. 

 

517 Marie Rose Armesto, “Europe’s Terrorist Incubator,” The Wall Street Journal, 2 September 2002. 

<http://www.hvk.org/articles/0902/62.html> 

518 Diana Muriel, “Thwarting Terrorist Cells in Europe,” CNN.com War Against Terrorism report, 23 January 2002. 

<http://www.cnn.com/2001/WORLD/europe/10/26/inv.thwarting.cells> 519 Daily Telegraph report, cited in Shape News Summary and Analysis, 4 June 2002. 

<http://www.globalsecurity.org/military/library/news/2002/06/mil-020604-shape02.htm> 

520 Alain Lallemand, “Belgium: Hotbed of Arms Trafficking,” Le Soir [Brussels], 7 March 2002 (FBIS Document 

EUP20020307000027). 

521 Judy Pasternak and Stephen Braun, “Following the Trail of Arms to Al-Qaida,” Los Angeles Times, 21 January 

2002. http://www.nisat.org; Ian Traynor, “The Gunrunner,” The Guardian [Manchester], 9 July 2001; and Alain 

Lallemand, “A Belgian Angolagate?” Le Soir [Brussels], 16 June 2001 (FBIS Document EUP20010617000081). 
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The status of Antwerp as Europe’s main diamond trade center has attracted illegal 

activity besides arms trafficking. In 2001 Belgium’s General Intelligence Service reported that 

illegal diamond trafficking with the UNITA rebel organization of Angola was linked with 

narcotics trafficking and money laundering. The report cited the South African diamond giant 

DeBeers and intermediaries in Great Britain and Canada. Diamonds reportedly were smuggled 

from Angola to London and Antwerp via Tel Aviv.522

Diamonds also have been instrumental in arms trafficking to other parts of the world; in 

2000, Belgian authorities identified diamonds as the exchange currency in shipments to the 

Middle Eastern terrorist organization Hizballah. Although not specifically linked to the narcotics 

trade, such trafficking operations, which have stood the test of time and political change, also 

have the potential to diversify their clientele and the currency that they accept in payment. 

Several individuals have based especially lucrative arms smuggling operations in Belgium. 

Terrorist and criminal networks also have benefited from the ease with which Belgian 

identification papers have circulated; in 2000, some 19,000 passports were stolen. The presence 

of major international organizations such as the North Atlantic Treaty Organization also may 

reduce the level of identification inspections for entry into the country. A number of nonstandard forms of documentation issued by international organizations are allowed. Foreigners 

from 11 other European countries can enter Belgium with expired passports, and no passport is 

required for citizens of 17 other European countries. Several individuals arrested in conjunction 

with the events of September 11 were carrying forged or stolen Belgian passports. Ten suspected 

al Qaeda operatives currently are in jail in Belgium. Experts have speculated that the 

assassination of Afghan military leader Ahmed Shah Masood was planned in Belgium.523

Cyprus and Monaco 

Cyprus and Monaco are magnets for money laundering because they provide fiscal 

incentives and offshore banking facilities. Both criminal and terrorist groups have found these 

conditions attractive. Located between France and Italy on the Mediterranean coast, Monaco has 

been a base for Italian and Russian mafia groups, which take advantage of the principality’s strict 

 

522 “Belgium Accused [of] Continuing Sale of UNITA Diamonds,” Panafrican News Agency report, 24 April 2001. 

<http://www.globalpolicy.org/security/issues/diamond/2001/0424belg.htm> 523 Pepe Escobar, “Tracking al-Qaeda in Europe, part 4,” Asia Times Online, 13 July 2002. 

http://www.atimes.com/atimes/Middle_East/DC13Ak02.html
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banking secrecy laws. Those laws make almost impossible the tracing of bank accounts to their 

true owners. Beyond the banking system, Monaco offers an “impenetrable wall of silence” about 

its residents, frequently frustrating investigators from neighboring countries.524

In the divided island of Cyprus, the highly developed telecommunications system and 

business and tourism sectors of the Greek sector, together with Cyprus’s location at the 

crossroads of trafficking routes at the eastern end of the Mediterranean Sea, make the country 

very attractive to organized crime organizations. The presence of a substantial merchant marine 

fleet provides ideal space to conceal smuggled goods. 

Both the Turkish northern sector of Cyprus and the officially recognized Greek southern 

sector are important money laundering and transit centers. In 1997, Turkish Cypriot heroin 

trafficker Huseyin Baybasin described the Turkish sector of Cyprus as a money-laundering 

haven for narcotics profits. According to Baybasin, for a total population of 100,000, the Turkish 

sector has 100 banks, which together with the sector’s many casinos offer easy avenues of 

money laundering.525 According to another report released in 2000, the Greek sector of the island 

has 24,000 companies registered, of which only 1,100 are physically present on the island.526

Such a situation indicates strongly that Cyprus’s Greek sector offers substantial illegal financial 

services. Former Yugoslav president Slobodan Milošević and Osama bin Laden are among 

figures who reportedly have placed large amounts of money illegally in the banks of Greek 

Cyprus. A strong link with Russian mafia organizations has been inferred because of the large 

number of Russian enterprises registered in the sector. According to a 2001 newspaper report, 

Cyprus also is an important laundering point for profits from the large-scale arms and narcotics 

trafficking operations in Greece, in which both the Russian and domestic mafia are involved.527

More recently, however, the EU has judged Cyprus’s money-laundering activities not to 

be a serious impediment to the country’s entry into that organization. The EU has expressed its 

satisfaction that Cyprus has money-laundering legislation (the Prevention and Suppression of 

 

524 Anne Barraclough, “Monte Carlo, the Russian Mafia and Dirty Money,” The Times of London, 7 February 2000. 525 Turkish Cypriot Press and Other Media, no. 19/1997 (29 January 1997). 

<http://www.hri.org/news/cyprus/tcpr/97-01-29.tcpr.htm> 

526 “Cyprus Criticizes Crime Report, Accuses U.S. Banks of Benefiting from Money-Laundering,” Kathimerini

[Athens], 23 December 2000 (FBIS Document GMP20001225000026). 

527 V. Nikolakopoulos, “The Arms Trade in Greece,” To Vima [Athens], 5 August 2001, cited in “Illegal Arms Trade 

in Greece Expanding Rapidly Due to Developments in Balkans,” report of International Action Network on Small 

Arms.” <http://www.iansa.org/news/2001/aug_01/trade_greece.htm> 
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Money Laundering Activities Law, passed in 1996) and is enforcing it sufficiently to meet West 

European standards.528

France 

In recent years, France has experienced several well-publicized cases of high-level 

corruption and financial fraud. The party of France’s President Jacques Chirac has been accused 

of illegal campaign financing and election fraud. Government officials allegedly have had 

conflicts of interest in their dealings with large private corporations.529 Wide publication of such 

incidents can undermine anti-corruption efforts among officials at lower levels. 

Although France has taken a leading role in establishment of OECD’s Financial Action 

Task Force (FATF), designed to prevent money laundering in member nations of that 

organization, in April 2002 a parliamentary committee found “major shortcomings in the 

country’s ability to tackle money laundering.” The focus of attention has been in cities along the 

Mediterranean coast, where the committee found that money launderers have “effective 

impunity.” Reportedly, real estate purchases are the favorite method of laundering money in this 

region, and Russian crime groups are heavily involved.530 In 2001 several large French banks 

came under investigation for participation in a money-laundering network that allegedly 

involved large banks from Israel, which is on the blacklist of the FATF.531

France has not passed laws specifically outlawing trafficking or enslavement of 

individuals. A 2000 report by the Council of Europe estimated that several thousand individuals 

from West Africa, Madagascar, India, Sri Lanka, and the Philippines are working in France as 

“domestic slaves,” having been brought into the country by traffickers.532 Substantial numbers of 

women also enter France for the sex trade. France also is known as a transit country for Chinese 

“snakehead” groups that move migrants from China and Russia to Western Europe. French 

authorities have not been able to uproot the Chinese trafficking routes, partly because the law’s 

 

528 Jean Christou, “EU and US Have Opposing Views on Money Laundering Charges,” Cyprus Mail, 3 October 

2001. 

529 Transparency International, “Global Corruption Report 2003.” <http://www.globalcorruptionreport.org> 530 “Riviera Money-Laundering Worries France,” BBC News report, 11 April 2002. 

<http://news.bbc.co.uk/2/hi/europe/1923138.stm> 

531 Sharon Berger and Zev Stub, “France Investigates Israeli Banks for Money-Laundering,” Jerusalem Post

[Jerusalem], 30 December 2001. <http://www.rense.com/general/18/laun.htm> 532 Bryant. 
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relatively light penalties, combined with high potential profits, attract criminals from more 

dangerous activities such as narcotics trafficking.533

After a spate of terrorist attacks in 1995, French authorities have used harsh new 

antiterrorism laws, strict security regulations, and intensified intelligence gathering to nearly 

eliminate such incidents in recent years.534 In this environment, France is not believed to be a 

potential launching country for international terrorist groups. 

Germany 

After the events of September 11, investigators discovered that two terrorist cells in 

Germany (one in Hamburg, one in Frankfurt) had been bases of operations for al Qaeda 

members. Analysts speculate that militants had been particularly attracted to Germany because 

immigration laws were lax and Germany had a Muslim community numbering 3 million. 

Hamburg has a large, well-integrated Muslim community that includes the largest Afghan 

population in Europe. Because that community was quiescent and moderate, it fell under little 

surveillance; only one secret service agent in the city was assigned to watch “Islamic 

extremists,” a category that included members of the Albanian Kosovo Liberation Army 

(Albanian initialism UCK) and the KADEK. In addition, German intelligence agencies had been 

reduced in the 1990s after the disappearance of Cold War tensions.535

In 1996 German border police reported that they apprehended only one in five illegal 

migrants crossing the border. Germany is a reunion point for illegal migrants arriving via plane 

and surface transportation, prior to moving toward France and Italy. Germany also is an 

important transit country for migrants that Chinese snakehead groups smuggle from Russia via 

the Czech Republic into other countries of Western Europe. Gangs from local Chinese 

communities aid the snakeheads in this endeavor. Some Chinese narcotics trafficking routes are 

identical to the migrant trafficking routes.536 Germany also is on the transit route of trafficked 

women, primarily from Poland, Ukraine, Russia, and the Czech Republic. A 1997 report 

 

533 Roger Faligot, La Mafia Chinoise en Europe (Paris: Calmann-Lévy, 2001), 202. 534 Hoffman. 535 Andreas Tzortis, “On the Trail of Terror’s German Connection,” The Christian Science Monitor, 25 October 

2001. 

536 Faligot, 137, 309-10. 
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estimated that at that time 15,000 Russian and East European women were engaged in 

prostitution in Germany.537

Germany has become an important narcotics transit route and destination. The growing 

population of Albanians in Germany, estimated to include as many as 400,000 people, has 

provided a formidable network for the narcotics distribution activities. Until the late 1990s, 

Albanian groups dominated that type of trafficking in Germany, but in recent years Croatian 

groups have superseded them.538 According to a 2002 report, Rhein-Main Airport in Frankfort is 

one of the three Western European airports most used by narcotics couriers from South 

America.539

Great Britain 

In recent years, Northern Ireland has experienced a substantial merging of domestic 

terrorist organizations with conventional criminal activities. Experts have suggested, in fact, that 

some branches of the religiously affiliated Irish insurgency groups have completely abandoned 

their political goals in favor of moneymaking activities. Two kinds of trafficking with 

transnational implications—in arms and in narcotics—have been linked to both criminal and 

domestic insurgency activities. In some cases, insurgent groups have used narcotics as direct 

payment for arms, and the trafficking networks of one commodity often are convenient pathways 

for moving the other.540

The terrorist heritage of the region has yielded a worrisome criminal element. Of 78 

criminal gangs identified by the Police Service of Northern Ireland (RUC) in 2001, some 43 have 

current or historical links to republican (Catholic) or loyalist (Protestant) paramilitary 

organizations, including the Irish Republican Army (IRA). Says a 2001 report in The Guardian: 

“Thirty years of terrorism have left a web of networks in which organized crime can thrive and a 

climate of fear and secrecy that makes fighting such crime very difficult.” Such groups take 

 

537 Global March, “Worst Forms of Child Labour Data: Germany.” 

<http://www.globalmarch.org/worstformsreport/world/germany/htm> 538 Mark Galeotti, “Albanian Gangs Gain Foothold in European Crime Underworld,” Jane’s Intelligence Review, 19 

October 2001. 

539 Steven Derix and Jos Verlaan, “Investigative Services Want More Operational Powers at Schiphol,” NRC 

Handelsblad [Rotterdam], 29 July 2002 (FBIS Document EUP20020730000226). 540 Richard Evans, “Systematic Transnational Crime: Organised Crime and Terrorist Financing in Northern Ireland,” 

Jane’s Intelligence Review [London], 1 September 2001. 
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advantage of arms supplies that have been accumulated by thirty years of smuggling in support 

of terrorist activity.541

According to the RUC, more than two-thirds of gang members in Northern Ireland are 

involved in narcotics dealing, 55 percent in forgery and counterfeiting, and 50 percent in money 

laundering. Groups with loyalist roots tend to be more active in narcotics trafficking than those 

with republican roots. Loyalist groups normally have granted “franchises” to drug dealers on 

their territory rather than controlling entire markets themselves. Narcotics trafficking has been 

especially attractive for newer loyalist groups such as the Loyalist Volunteer Force because 

narcotics can provide a quick cash return. Interdiction is difficult because police forces have 

been reduced, are under funded, and do not enjoy the confidence of the citizenry. In 2001 the 

police force reported a budget shortfall of 20 million pounds (about US$32 million).542

Police sources believe that both loyalist and republican groups have fostered contacts 

with foreign organized crime groups, either directly or via the Irish diaspora. Counterfeit tobacco 

products, for example, have been obtained from groups in Eastern Europe, and some narcotics 

shipments reportedly have arrived from groups in Spain. 

The Real Irish Republican Army (RIRA), a militant splinter group of the IRA, has 

become increasingly active in other parts of Great Britain, in both criminal activities and 

activities in support of a terrorist agenda. (Those two types of activity often are one and the 

same.) Police authorities estimate that 80 percent of RIRA activity in mainland Great Britain is 

related to conventional crime. Metropolitan Police commissioner David Veness says, 

“Paramilitaries...[are] coming to the mainland because their ability to exploit the economic 

marketplace of the island of Ireland is now limited, whereas Great Britain and indeed mainland 

Europe represent a much more lucrative marketplace.”543

England has gained a reputation as a safe haven for terrorist groups because of its open 

immigration policy and tolerant attitude toward a variety of dissenters. Countries such as India, 

Sri Lanka, Saudi Arabia, Egypt, and Yemen have called unsuccessfully on England to apprehend 

suspected terrorists from those countries who have taken refuge in London.544 Great Britain’s 

 

541 Rosie Cowan, “The 78 Criminal Gangs Waging War on Ulster,” The Guardian [London], 23 March 2001. 542 Cowan. 543 Evans. 544 Richard Beeston, “The Bomber from Birmingham: Pressure on Britain to End Safe Haven for Political 

Extremists,” The Times of London, 28 December 2000 (FBIS Document EUP20001228000096). 
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Terrorism Act of 2000 has substantially expanded the authority of police and the home secretary 

(equivalent to a minister of the interior) to shut down fund-raising, recruitment, and training 

conducted by suspected terrorist cells under the guise of political or religious activity. Another 

law makes possible the confiscation of a group’s bank assets in England if a conspiracy to 

commit a terrorist act can be proven. 

In recent years, several factors have made Great Britain a hospitable country for 

transnational criminal groups. Because Great Britain now is a preferred destination for illegal 

migrants and because traffickers in people are able to comply with such wishes, human 

trafficking now is the second most profitable criminal activity in the country, next to narcotics 

trafficking. The country’s open economy offers a market for a variety of counterfeit goods as 

well as narcotics. Great Britain’s financial institutions offer the combination of reliability and 

anonymity necessary for money laundering; regulation of security markets and exchange bureaus 

is insufficient and inefficient.545 The country’s large and growing ethnic communities offer 

protection and anonymity. And Great Britain’s long, irregular coastline and large number of busy 

ports offer opportunities to move illegal people and commodities into the country by sea. 

All of the above factors have changed the nature of conventional crime. Traditionally, the 

vast majority of criminal groups in Great Britain have been of domestic origin whose activities 

had little transnational impact. During the 1990s, major groups have appeared in Great Britain 

from Colombia, China, Jamaica, South Asia, Turkey, and West Africa. According to a 2000 

government report, within a single year Albanian criminal groups gained control of 79 percent of 

saunas and massage parlors. Both sites are used for narcotics distribution and money laundering, 

as well as prostitution in central London. 

Greece 

Several conditions make Greece attractive to non-indigenous organized crime groups: its 

location between Western Europe and the eastern end of the Mediterranean, the existence of a 

substantial domestic mafia, and corruption at high levels of government. Greece’s long, irregular 

coastline and many islands make adequate patrolling impossible. Greece lies on the traditional 

“Balkan route” that brings a wide variety of illegal goods into Europe from the Middle East and 

 

545 Tamara Makarenko, “Destination UK,” Jane’s Intelligence Review [London], 1 December 2001. 
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beyond. In recent years that route has expanded to include Greece’s border with Bulgaria and 

Macedonia and new transit points on the coast of the Aegean Sea. Albania, which is directly 

northwest of Greece, has been a chronic source of illegal activity.546 Greece’s seaports also 

handle a high volume of container traffic that is not under strict customs control. 

Greece is both a transit stage and a destination for trafficking women, many of whom 

come from Russia, Ukraine, Bulgaria, the former Yugoslavia, and Albania.547 The volume of 

trafficking for prostitution has increased substantially in recent years. According to one report, at 

any given time as many as 20,000 trafficked women are working in the sex trade in Greece; 

another report estimates that 40,000 women are trafficked into Greece annually.548 Many of the 

women pass through Greece en route to Western Europe. 

According to recent reports, Greece also is an important transit point for the international 

arms trafficking industry. Albanian, Italian, and Russian organized crime groups and guerrilla 

organizations in Kosovo are moving arms through various parts of Greece to points elsewhere in 

Europe.549 Greek security authorities estimate that 50,000 illegal guns per year enter Greece.550

In August 2001, a Greek newspaper report stated that “guns and narcotics are shipped to Greece 

from nations of the former USSR and are then shipped to European nations through Italy. The 

immense profits of this trade are laundered in Greece and Cyprus, where the Russian mafia has a 

strong support base. The Russian mafia is also involved in narcotics and prostitution.”551

Interdiction has been difficult because Russian groups have established links with “influential 

officials” in Greece.552 Another important source of illegal arms trade in Greece is the large 

number of weapons (estimated at 550,000) stolen from military stockpiles in Albania during that 

country’s 1997 uprising.553

In Greece the illegally traded weapons are primarily light guns, including the Russian 

Kalashnikov and the Israeli Uzi, although items such as rocket launchers also appear on the black 

 

546 “Organized Crime Threat in SE Europe: U.S. Names Greece, Cyprus,” Kathimerini [Athens], 23 December 2000. 

<http://www.alb-net.com/pipermail/albsa-info/2000-December/001071.htm> 547 U.S. Department of State, Trafficking in Persons Report 2001. <http://www.state.gov/g/tip/rls/tiprpt/2001> 548 U.S. Department of State, Country Reports on Human Rights Practices, March 2002. 

<http://www.state.gov/g/drl/rls/hrrpt/2002/c8697.htm> 549 Nikolakopoulos. 550 Yeoryios Sombolos, “2.5 Billion Drachmas Annual Turnover from Arms Trafficking,” Imerisia [Athens], 22 

December 2001. <http://www.nisat.org>

551 Nikolakopoulos. 552 Nikolakopoulos. 553 Sombolos. 
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market. Sicilian mafia groups have been trafficking in arms, narcotics, and cigarettes in western 

Greece since at least 1999. This trade often is done in cooperation with Albanian groups, which 

already had begun exploiting Greece’s northwestern coastline with high-speed boats in the 

1990s.554 Romanian groups also have a share of the market in Athens.555

Crete is the largest center of the arms trade in Greece, but Albanian traffickers have 

established significant markets in the Evros River delta and in the city of Ioannina, in 

northeastern and northwestern Greece respectively. Kalashnikovs and grenades from Albania 

often remain in the hands of crime organizations in Greece. Smuggled weapons also enjoy a 

substantial market among ordinary Greeks because of Greece’s onerous gun ownership 

requirements.556

In keeping with the increased pragmatism and business acumen of criminal groups, in the 

mid-1990s criminal organizations of mixed ethnicity began appearing in Greece. In the case of 

narcotics trafficking, such organizations often include Albanians who concentrate on production 

in their own country; ethnic Greek Albanians, who smuggle products from Albania into Greece; 

and Greek nationals, who are in charge of distribution in major urban centers.557

Greece’s dynamic banking sector has been accused of harboring transnational money 

laundering activities behind its less-than-transparent disclosure policies and loose government 

controls. Reportedly, domestic money laundering also occurs in Greece’s many nightclubs and 

casinos; transnational money laundering also may be present.558

The involvement of corrupt state officials has been a major reason that Greece attracts 

criminal activity. In mid-2002, legal briefs in a court case against local mafia figures alleged that 

the complicity of State Coast Guard and other officials prevented apprehension of criminals who 

had committed crimes ranging from protection rackets to murder. The Coast Guard is an 

 

554 Kostas Khatzidis, “The Italian Mafia Has Spread Its Tentacles into Greece,” Ta Nea [Athens], 20 July 2000. 

<http://www.nisat.org> 

555 “Romanian Arms Traffickers Take Over Athens Market,” VIMAgazino [Athens], cited in Ziua [Bucharest], 10 

August 2001. <http://www.nisat.org> 

556 Sombolos. 557 Observatoire Géopolitique des Drogues, Annual Report 1995-1996. 

<http://www.ogd.org/rapport/gb/RP00_TABLE> 

558 V.Y. Lambropoulos, “Night Clubs Launder Dirty Money,” To Vima [Athens], 8 March 2002 (FBIS Document 

GMP20020308000107). 
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especially crucial link in Greece’s defense against crime because of the many accesses to the 

country from the sea.559

November 17, a small but violent anti-United States terrorist group that surfaced in 

Greece in the 1970s, was effectively incapacitated in mid-2002 when authorities learned its 

structure and methodology. The group long had evaded Greek and international law enforcement 

authorities after having committed a series of attacks, including assassinations, against Turkish, 

U.S., and multinational targets in Greece. At least one leader of November 17, Savvas Xiros, 

reportedly had connections in the Islamic fundamentalist Egypt-based Muslim Brotherhood.560

Greek authorities also have established a link between November 17 and the People’s 

Revolutionary Struggle (ELA), a domestic terrorist group whose main body disbanded in 

1995.561

Italy 

Italy has been home to major crime groups for more than 100 years. In recent years, 

however, significant groups from other countries have established operations in parts of the 

country that had not been under the strict control of an indigenous organization. Groups such as 

the Albanians have gained access through connections with existing ethnic groups in Italy. The 

domestic mafia, which in many cases has welcomed cooperative ventures with foreign groups, 

includes four major groups, which altogether include more than 500 individual families. Such 

structures are intrinsic parts of Italian society. One scholar has explained the state’s inability to 

eradicate criminal groups as the result of Italy’s 19th-century origins as a federation in which 

central authorities needed the loyalty of local power groups to maintain their position. Mafia 

groups maintained local power by supplying needed services that the state failed to provide. Key 

elements of this political structure still support the existence of the mafia “families.” Another 

important factor is the rigidity and inefficiency of Italian public administration, which is based 

on a maze of complex laws that encourage citizens to take action outside the law and officials to 

 

559 Dhionisis Nasopoulos, “The Secret War of the Athens Mobs,” Ta Nea [Athens], 27 August 2002. 560 Tekla Szymanski, “Hunting Down a Greek Terrorist Organization,” World Press Review, 49, no. 9, September 

2002. <http://www.worldpress.org/Europe/671.cfm> 

561 “Greece Plans New Arrests Linking November 17 with Other Groups,” World Tribune.com report, 22 January 

2003. <http://216.26.163.62/2003/eu_greece_01_22.htm> 
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engage in corruption.562 The mafia often functions as an adjudicator of disputes when settlement 

is sought outside the law. 

The presence of Albanian, Kosovar, Russian, Serbian, and Turkish criminal groups has 

been increasingly visible in recent years. Because of its long, loosely patrolled coastline, 

geographical position, and famously lax enforcement of immigration controls, Italy has received 

a wave of illegal immigrants from Albania, Eastern Europe, Kurdistan, and Turkey. The 45-milewide Strait of Otranto, which separates Italy from Albania, is a favorite route. The Albanian 

population of Italy has been estimated at 110,000 to 200,000, of which 20 to 40 percent are 

illegal immigrants. Police authorities have admitted that expulsion orders seldom are enforced. 

Because of the EU’s open border policy, individuals can travel at will once they have penetrated 

the border of a member country such as Italy. In central and northern Italy, where domestic 

groups exert less control, non-Italian criminal groups have reached agreements granting them 

control of specified markets or activities. In the southern strongholds of the Italian mafia groups, 

foreign groups can negotiate for a franchise or operating tax for activities in which the Italians 

have relatively little interest, such as migrant trafficking and prostitution. The tax may take the 

form of narcotics, arms, or cash.563

In these circumstances, Albanian, Chinese, Nigerian, and Russian groups have 

consolidated their presence in northern and central Italy. Although they have maintained a 

relatively low profile, groups from Russia and other parts of the former Soviet Union have been 

active since the early 1990s, both independently and in cooperation with indigenous groups. The 

activities of the Russian groups have centered around acquisition of property in the tourism and 

leisure industries, money laundering, currency counterfeiting, the trafficking of arms and 

synthetic narcotics, and trafficking women. Reportedly, contacts between Italian criminals and 

individuals in Russia’s Ministry of Defense brought a supply of Russian arms to the Italian mafia 

in return for investments in Russian industrial and financial enterprises. Italian justice authorities 

periodically have sought extradition of Russian crime figures for a variety of transnational deals 

between the two countries.564

 

562 Letizia Paoli, “Crime, Italian Style,” Daedalus, Summer 2001, 157. 563 Alison Jamieson, “Italy’s Criminal Gangs Change Their Tactics,” Jane’s Intelligence Review, 1 December 2001. 564 Jamieson. 
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Nigerian crime syndicates are active in Italy’s narcotics market and in prostitution rings 

that are present in all of Italy’s regions except for the far south and Sicily. Chinese groups 

located primarily in central and northern Italy are active in extortion, migrant trafficking, and 

running textile sweatshops.565

Albanian groups, considered especially dangerous because of their tight organization and 

violent tactics, have close contacts with all four major Italian groups. The Albanians have largely 

taken over the supply of heroin to northern Italian cities, superseding Turkish traffickers. The 

Albanians have significantly altered the pattern of narcotics distribution in Italy by distributing 

cocaine from Colombian cartels and marijuana from Albania. Albanian groups also traffic 

prostitutes from resorts owned by the Italian Camorra group on the islands of Corfu, Rhodes, and 

Cyprus (see also Albania). In Milan, Albanian groups have violently exterminated Italian and 

North African groups in their quest to dominate that city’s narcotics trade. 

The Albanian “invasion” has aroused greater resistance among law enforcement 

authorities than have the activities of domestic groups. Some major police operations against 

Albanian groups have been successful. Domestic criminal groups also have shown signs of 

reacting to the takeover of their territory. Although Albanian-Italian criminal cooperation 

remains quite lucrative, there is some evidence that Italian groups are uniting to regain power.566

Post-September 11 investigations revealed that a cell of North African extremist Muslims 

had established a logistical base in Milan that provided counterfeit documents, lodging, and 

money. In this case, Italy’s criminal infrastructure and high level of corruption apparently had 

offered a more favorable setting for terrorist logistical planning than France, for example. The 

hospitality of Italy is limited, however, by an anti-Islamic tradition that is especially strong in the 

south.567

The Netherlands 

The Netherlands offers conditions favorable to illegal trafficking. It boasts a highly 

developed communications system and two major seaports, Amsterdam and Rotterdam, where a 

 

565 Jamieson. 566 Galeotti. 567 Kevin Whitelaw et al., “The Terror That Wasn’t,” U.S. News and World Report, 29 October 2001. 
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high volume of cargo containers is handled quickly and with relatively lax customs controls.568

The 58 Chinese illegal migrants found dead in Dover (Great Britain) had been moved through 

the Netherlands by a Chinese snakehead group. Eight of the nine suspects in that case were 

Chinese living in Rotterdam. 

Heavy volume has compromised the security controls at Amsterdam’s Schiphol Airport, 

making it a center of narcotics and human trafficking from the Middle East, Eastern Europe, and 

Latin America. According to the district attorney of Amsterdam, more intensive security 

measures would compromise the economic viability of this vital European air transport node. 

Schiphol is one of three West European airports favored by narcotics couriers from South 

America. Criminals at the airport operate in ad hoc groups rather than fixed organizations, 

relying on “facilitators” to connect them with transnational traffickers in need of their assistance. 

Facilitators most often are corrupt civil servants or employees of transit companies. The loading 

and unloading of cargo often is virtually unsupervised and controls over airline passenger lists 

are ineffective because the Netherlands’ privacy legislation prohibits the use of digital databases 

to monitor passenger traffic.569

These conditions, which have made the Netherlands one of the most active narcotics and 

human trafficking countries in the world, also favor arms trafficking. In 2001, police confiscated 

rocket propelled grenades, hand grenades, and anti-tank weapons. The Amsterdam arms trade is 

shared among groups from Turkey and Yugoslavia. According to police sources, Yugoslav 

criminals have superseded Russians in the Netherlands and are taking a prominent role in arms 

trafficking. Investigators have theorized about links between the Basque ETA and the splinter 

Real Irish Republican Army.570

Spain 

Spain has become a cocaine supply hub for European criminal organizations as well as a 

major money-laundering center for the profits generated by this trade. Urban centers such as 

Madrid, Alicante, Seville, Barcelona, and Malaga host transnational crime groups, some of 

 

568 Stephane Alonso, “Fight Against Narcotics Is Symbolic,” NRC Handelsblad [Rotterdam], 31 August 2002 (FBIS 

Document EUP20020902000252). 

569 Derix and Verlaam. 570 Andrew Osborn, “Amsterdam in Shock as Killer Gangs Muscle in on Tourist Haunts,” The Guardian [London], 

23 October 2000. <http://www.guardian.co.uk/international/story/0,3604,415081,00.htm> 
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which remain in a city only long enough for a single transaction. Several groups have more 

permanent bases along Spain’s southern Costa del Sol, from where they sell their services as 

traffickers or protectors of narcotics, as money launderers, and as dealers in illegal migrants and 

women for the sex trade.571

A major factor in this high degree of criminal activity seems to be the collusion of highlevel political figures. In 2000, investigators alleged that Calabrian (southern Italian) mafia 

operations enjoyed the protection of Jesus Gil, the mayor of Marbella, located on the 

Mediterranean coast between Gibraltar and Malaga. Shortly thereafter, the unnamed mayor of 

Estapona, just west of Marbella on Spain’s Mediterranean Sun Coast (Costa del Sol), was 

accused of assisting a major Turkish heroin trafficker to launder his profits. The establishment of 

front businesses that legitimize Colombian narcotics trafficking activities presumably requires 

political collusion or partnerships with local businessmen, many of whom also are politicians. A 

2001 report by the Center for Geopolitical Drug Studies summarized the situation on the Costa 

del Sol: “The Costa del Sol has become a veritable sanctuary for criminal organizations that 

often enjoy political protection.”572

Spain now is the main entry point of Colombian drugs into Europe. Historically, 

smugglers in the province of Galicia, on the Portuguese border, worked with Colombian cartels 

to move narcotics into Europe, for which the Galicians received one-half the shipment for their 

own distribution. After the Galician rings were weakened by new domestic and multinational law 

enforcement efforts in 2000, the Colombians began shifting their routes to the Mediterranean 

port of Valencia via the Strait of Gibraltar, then to Madrid. The versatility of the Colombians 

seems to have preserved the profitability of their European markets and the overall role of Spain. 

Partnerships with local Spanish traffickers makes detection more difficult. Meanwhile, the 

Galician traffickers have diversified to include increasing amounts of hashish and heroin from 

Turkey. The restrictions on the Galicians’ Colombian connection also stimulated new 

agreements with Portuguese traffickers when Portugal became a second alternate route for the 

 

571 “The New Route of Colombian Traffickers,” Geopolitical Drug Newsletter, July-August 2001. 

<http://www.geodrugs.net/mini-lettres/AEGD5GB.pdf> 572 “The New Route of Colombian Traffickers.” 
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Colombians.573 According to a 2002 report, Barcelona Airport is one of the three West European 

airports most favored by narcotics couriers from South America.574

For four decades, Spanish authorities have been battling the Basque Fatherland and 

Liberty (Euzkadi Ta Askatasuna, ETA) organization, a separatist group that has used terrorist 

tactics on many occasions. Despite periodic cease-fires, the group has continued to launch 

attacks on Spanish territory, and authorities continue to make arrests.575 The ETA is believed to 

have purchased weapons from the Italian mafia and other arms traffickers. 

Al Qaeda also has had a significant presence in Spain. Al Qaeda cell members 

apprehended in Madrid and Granada in November 2001 were accused of providing logistical 

support to the September 11 hijackers, including counterfeit credit cards, and a Spanish citizen of 

Syrian origin allegedly was at the center of a money-laundering network that funded al Qaeda 

groups in Europe.576 In January 2003, 16 al Qaeda suspects were arrested in a combined Spanish 

and French operation in Spanish cities close to the French border, including Barcelona. 

Turkey 

Although there is little evidence of non-indigenous criminal or terrorist groups having 

permanent bases in Turkey, the country is a vital transit line for trafficking in narcotics and other 

commodities. The main factors contributing to this status are porous borders, a weak penal code, 

and widespread official corruption. Rampant corruption includes police officers, who receive 

very low salaries, and senior officials, who have been accused of collaborating with organized 

crime organizations to protect narcotics trafficking. Sources in West European countries have 

reported that as much as 75 percent of the illegal narcotics entering Western Europe either transit 

through or originate in Turkey. Frequently such reports have concluded that such heavy traffic 

could not occur without the knowledge and complicity of the Turkish government. When 

Turkish narcotics kingpin Huseyin Baybasin was captured, he claimed immunity because his 

 

573 “The New Route of Colombian Traffickers.” 574 Derix and Verlaam. 575 “Intelligence News Summary,” various dates, 2001-2003,” Intelligence Network reports. 

<http://www.intellnet.org/news/index/html?type=category&value=Spain> 

576 “Al-Qaeda Financier Was Former Accountant to Saudi Royals: Lawyer,” Middle East Times [Nicosia], 19 

September 2002. http://www.metimes.com/2K2/Issue2002-38/reg/al_qaeda_financier.htm. See also a series of 

reports on al-Qaeda links with Spain by Dan Sale, February and March 2003, referenced in Intellnet. 

<http://www.intellnet.org/news/index/html?type=category&value=Spain> 
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trafficking activity had been on behalf of his government. Baybasin claimed that Turkey’s state 

security apparatus and Turkish Intelligence Agency (MIT) had fully supported the success of one 

of the world’s largest narcotics syndicates.577 A scandal that broke in early 1999 revealed a 

pattern of telephone communication between a member of a criminal clan and officials high in 

the offices of the president and the National security agencies of Turkey.578

Turkey’s border controls are weak. Most of Turkey’s 73 sea and land border checkpoints 

lack adequate control measures such as radiation detectors and x-ray equipment. Because Turkey 

has borders with seven other countries where a wide variety of criminal activity takes place, this 

inadequate system is tested severely by illegal trafficking groups. As Turkey’s traditionalist 

society has been exposed very rapidly to Western culture and commercialism, reforms of the 

country’s legal system have not kept pace. This failure has enabled citizens to circumvent rules 

and laws that have failed to adapt effectively to the new conditions. Bribery is a practice that has 

lubricated the machinery of the parallel commercial system that has evolved under these 

circumstances. In passing new legislation to deal with such practices, successive Turkish 

governments have only increased the web of bureaucracy that was a primary cause of the 

original problem. 

Reportedly, a large percentage of Turkey’s domestic organized crime evolved from a 

state-run security apparatus that used armed thugs to protect government officials from Turkey’s 

very active opposition groups, some of which were connected with the outlawed Kurdistan 

Workers’ Party (PKK). By the time the need for this type of extreme security subsided, the force 

had grown beyond legal control. According to a 2000 report, for example, the fanatical Muslim 

group Hizbullah (not connected with the Hizballah group of Lebanon) acquired weapons that a 

regional governor had imported into Turkey for use by a counter-insurgency group opposing the 

PKK in southeastern Turkey.579

 

577 Tony Thompson, “Heroin ‘Emperor’ Brings Terror to UK Streets,” The Observer [London], 17 November 2002. 

<http://society.guardian.co.uk/Print/0,3858,4548336,00.html> 

578 Alessandro Politi, “The New Dimensions of Organized Crime in Southeastern Europe,” The International 

Spectator, 34, no. 4 (October-December 1999). 579 “Europe: A Finger Points,” The Economist, 26 February 2000. 
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Conclusion 

In Western Europe, transnational and domestic organized crime groups have taken 

advantage of some intrinsic weaknesses such as lack of border controls within the Schengen 

group, geographical location, and corruption. As they operate enterprises with increasing 

similarity to legitimate businesses, such groups also have taken advantage of the region’s 

increasingly strong and well-integrated communications and transportation infrastructure. 

Historical and cultural ties play an important role in the distribution of transnational 

crime in the region. For example, Portugal and Spain are natural bridgeheads for narcotics 

trafficking into Europe from Latin America, and a number of large Chinese and Turkish 

communities provide cover in many West European countries for criminal organizations of the 

same ethnic background. A more recent trend is cooperation among criminal groups of different 

ethnic backgrounds, often bringing a group such as the Albanians into territory traditionally 

dominated by domestic groups such as the Italians. The cooperation of crime groups has been 

especially evident in Western Europe. The trend parallels the pragmatic globalization of 

legitimate commerce and is a strong driver in the increased “transnationalization” of criminal 

activities. However, it must be noted that traditional, violent “turf wars” still occur in the 

European underworld. 

Western Europe also has provided terrorist cells with a favorable environment for 

planning, recruiting, and fund-raising. As is the case for conventional crime, the region’s 

sophisticated communications and transportation infrastructure offers valuable assistance to such 

terrorist activities, as does the presence of large immigrant communities from which to recruit. 

Until recently, the lax immigration and anti-terrorist policies of several West European countries 

also fostered the preparatory stages of terrorist activities, such as fund-raising and recruiting. In 

many European countries, the events of September 11 have brought the first stages of a 

pronounced reversal of those conditions. 

WESTERN HEMISPHERE 

The Western Hemisphere countries to be examined in this report—Canada, Colombia, 

Mexico, and the Triborder Area including parts of Argentina, Brazil, and Paraguay—present a 

variety of conditions favoring transnational crime and some terrorist activity. Law enforcement 
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and border conditions in Canada and Mexico have promoted the trafficking of narcotics and 

people across the long borders that those countries share with the United States, as well as the 

presence of large numbers of illegal immigrants within those countries. In the case of Canada, 

this condition also has resulted in the movement of some terrorists into the United States. 

Colombia and the TBA have long-standing conditions of lawlessness that have fostered intensive 

narcotics and arms trafficking and a high level of violence (in the case of Colombia) and a wide 

variety of trafficking activity, some of which apparently has subsidized terrorist cells from 

abroad (in the case of the TBA). 

Canada 

Introduction 

Canada has played a significant role as a base for both transnational criminal activity and 

terrorist activity. This role is magnified by the country’s extensive border with the United States 

and a long tradition of commercial and cultural relations between the countries. At least until 

recently, a major factor has been Canada’s policies toward border enforcement and illegal 

immigration. 

According to a 2001 report by the U.S. Department of State, “Overall anti-terrorism 

cooperation with Canada is excellent, and stands as a model of how the United States and other 

nations can work together on terrorism issues.”580 Canada has assisted and cooperated with the 

United States on all fronts of the current war against terrorism. It has, for example, frozen the 

assets of suspected terrorists and is working closely with the United States to improve security 

along their common borders. Canadian and U.S. customs and immigration agencies, police 

forces, and intelligence agencies have a long history of cooperation on border security. This 

coordination has been strengthened in recent years through formal arrangements such as the 

U.S.-Canadian Bilateral Consultative Group on Counterterrorism Cooperation (BCG) and the 

Smart Border Action Plan.581

 

580U.S. Department of State, Patterns of Global Terrorism 2001. 

<http://www.state.gov/s/ct/rls/pgtrpt/2001/html/10248.htm> 581 Embassy of Canada, Washington, D.C., “The Smart Border Declaration,” 11 February 2003. 

http://www.canadianembassy.org/border/declaration-en.asp; and Embassy of Canada, Washington, D.C., “CanadaU.S. Cross Border Crime and Security Cooperation.” http://www.canadianembassy.org/border/crime-en.asp 
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According to numerous intelligence and law enforcement reports, however, terrorists and 

international organized crime groups increasingly are using Canada as an operational base and 

transit country en route to the United States. A generous social-welfare system, lax immigration 

laws, infrequent prosecutions, light sentencing, and long borders and coastlines offer many 

points and methods of entry that facilitate movement to and from various countries, particularly 

to the United States. These factors combine to make Canada a favored destination for terrorists 

and international organized crime groups. 

Contributing Factors 

Three broad factors contribute to Canada’s position as a favored destination for terrorists 

and international criminals. First, as a modern liberal democracy Canada possesses a number of 

features that make it hospitable to terrorists and international criminals. The Canadian 

Constitution guarantees rights such as the right to life, liberty, freedom of movement, freedom of 

speech, protection against unreasonable search and seizure, and protection against arbitrary 

detention or imprisonment that make it easier for terrorists and international criminals to operate. 

In addition, a technologically advanced economy and infrastructure facilitate operations and 

activities as well as providing a myriad of opportunities for abuse.582

Second, Canada’s geographical features and its location make it uniquely inviting to 

terrorists and international crime groups. Canada and the United States share a 5,525 mile-long 

border (7,000 miles including Alaska) that defies full control. There are 130 official land ports 

of entry between the United States and Canada, and thousands of unguarded points along the 

border across which individuals and illicit goods can be transported. In addition, there are no 

man made barriers along the U.S.-Canadian border to restrict crossing.583

Third, particular systemic and institutional characteristics make Canada hospitable to 

international terrorists and criminals. David Griffin, Executive Officer of the Canadian Police 

Association, explained: 

 

582 Canada, Department of Justice, “Constitution Acts of 1867 and 1982.” <http://laws.justice.gc.ca/en/const>; and 

Canada, Department of Justice, “Canadian Charter of Rights and Freedoms.” 

<http://laws.justice.gc.ca/en/charter/index.html> 

583 Wendell Sanford, Consul of Canada, remarks for an Address: “Canada Post 9/11 – The New True North Strong 

and Free,” University of California, Berkeley, Oct. 9, 2002. 
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Our proximity to the United States of America makes Canada extremely 

vulnerable, however it is our lax immigration policy, open borders, weak laws, 

archaic justice system, an even weaker corrections system and under enforcement 

that make us extremely attractive to the sophisticated criminal.584

In a 1999 Canadian Security Intelligence Service (CSIS) report entitled “Exploitation of 

Canada’s Immigration System: An Overview of Security Intelligence Concerns,” CSIS Director 

Ward Elcock is quoted as saying that “in most cases, [terrorists] appear to use Canadian 

residence as a safe haven, a means to raise funds, to plan or support overseas activities or as a 

way to obtain Canadian travel documents which make global travel easier.” According to the 

report, more than 50 terrorist groups are believed to be operating in Canada, including the 

Algerian Armed Islamic Group, the Egyptian Islamic Jihad, the Tamil Tigers, Sikh extremists, 

the Kurdistan Workers Party, Hizballah, and extremist Irish groups.585

According to a 1999 report by Canada’s Special Senate Committee on Security and 

Intelligence, 

Illegal migration into Canada—primarily through the refugee determination system—

persists as a concern from two perspectives. First, it is a means by which terrorists may 

circumvent Canada’s vetting process abroad and enter in search of a temporary or 

permanent haven. Once in Canada, they may conduct fundraising or other activities or, 

in a very few cases, organize acts of violence in Canada or against other countries. 

Second, large volumes of illegal migrants provide the stream in which a few terrorists can 

ultimately gain entry to the United States by circumventing Canadian and United States 

border controls.586

Canada has arguably the most generous asylum system of any country in the world. 

Aliens have a substantially higher chance of gaining asylum in Canada than in the United States. 

In 1999, Canada granted asylum to 54 percent of applicants, compared with 35 percent in the 

United States. This condition, combined with easy entry into the United States from Canada, 

explains why Canada is a primary transition point for smuggled aliens.587

 

584 David Griffin, “Organised Crime in Canada,” Police Magazine, January 2001. 

<http://www.polfed.org/magazine/01_2001/01_2001_orgcrime.htm> 

585 Canadian Security Intelligence Service Director Ward Elcock, in Jonathan Dube, “Safe Haven for Terror?” 

ABCNEWS.com. Jan. 14, 2000. <http://abcnews.go.com/sections/world/DailyNews/canada_terrorism000114.html> 586 Canada, Senate, Special Committees on Terrorism and Public Safety, “Response to Recommendations of the 

Senate Special Committees on Terrorism and Public Safety,” January 1999. 

<http://www.parl.gc.ca/36/1/parlbus/commbus/senate/com-e/secu-e/rep-e/repsecintjan99-e.htm> 587 Jeffrey Gettleman, “Canadians Begin to Say No to Immigrants From China,” Los Angeles Times, Sep. 11, 1999. 
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Perhaps until recently, there has also not been widespread concern that Canada could be 

the victim of a terrorist attack. Sensitivity to civil liberties combined with this low threat 

perception has made both the adoption and the enforcement of tougher immigration laws and 

strong counter terrorism measures more difficult. The fact that the 2002 bill designed to make 

Canada’s immigration laws less favorable to terrorists and international criminals is entitled the 

“Immigration and Refugee Protection Act” serves as an indication of the prevailing concern for 

or priority placed upon civil liberties in Canada. 

Crimes committed in Canada are not considered relevant to asylum requests unless they 

would bring more than ten years of imprisonment. 588 This provision means that most of the 

criminal means by which terrorists raise funds—such as fraud, theft, and counterfeiting—would 

not disqualify them for asylum, even if they are found guilty. The same can be said for a portion 

of the illegal activities engaged in by international organized criminal groups. 

Upon arriving at a Canadian port of entry, an individual claiming refugee status normally 

is released, with no provision for monitoring, rather than being detained pending investigation, as 

is the practice in Great Britain and the United States.589 As their claim is under consideration, 

such claimants can receive work permits, welfare payments, and housing and health care from 

the government.590 Deportation orders seldom are carried out for those whose refugee claims are 

denied.591

As of April 2003, Canada’s Immigration and Refugee Board had a backlog of 53,000 

asylum cases. A 2003 report by Canada’s Auditor-General said Canada has lost track of 36,000 

people who have been ordered to leave the country over the past six years. The report also notes 

that only 44 of Canada's 272 staffed points of entry have immigration officers available to 

conduct the second level of screening required for suspect individuals, and the 44 points that do 

have immigration officers able to perform this screening are not staffed 24 hours a day. When 

 

588 These features are identified in the course of interviews conducted by the Public Broadcasting Service’s 

documentary program Frontline, with Bill Bauer, former member of the Canadian Immigration and Refugee Board; 

Elinor Caplin, Canada's Minister of Immigration; and David Harris, former chief of strategic planning for the 

Canadian Security Intelligence Service (CSIS). “Is Canada a Safe Haven for Terrorists?” Frontline, PBS, 2001. 

www.pbs.org/wgbh/pages/frontline/shows/trail/etc/canada.html#harris 589 “Is Canada a Safe Haven for Terrorists?” Frontline, PBS, 2001. 

www.pbs.org/wgbh/pages/frontline/shows/trail/etc/canada.html#harris 590 “Is Canada a Safe Haven for Terrorists?” Frontline, PBS, 2001. 

www.pbs.org/wgbh/pages/frontline/shows/trail/etc/canada.html#harris 591 United States, Congress, 106th, House of Representatives, The Committee on the Judiciary, Hearing Before the 

Subcommittee on Immigration and Claims, “Threat to the United States,” 26 January 2000. 
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no immigration officer is available to do the second screening, the person is allowed into Canada 

and asked to go to another border crossing. 592

Terrorist Activity 

Terrorist groups operating in Canada generate funds from activities such as drug 

trafficking and arms smuggling, as well as through charitable donations. Islamic terrorist groups 

have engaged in both petty crime and organized criminal ventures to raise funds. The Royal 

Canadian Mounted Police has determined, for example, that profits from a number of auto theft 

rings in Ontario and Quebec have gone to support the Lebanese terrorist group Hizballah.593

Specific instances of crime in Canada supporting terrorist activities have been 

documented. In October 2002, the National Post reported that the CSIS had determined that 

Hizballah had laundered of tens of thousands of dollars through Canadian banks, while drawing 

on the accounts to shop for military equipment. According to the CSIS documentation, 

Hizballah agents had sought blasting devices, night-vision goggles, powerful computers, and 

camera equipment to record attacks against Israeli forces.594

In December 1999, an al Qaeda-trained terrorist, Ahmed Ressam, was arrested as he tried 

to cross into the United States with more than 100 pounds of powerful explosives intended to 

blow up a terminal at Los Angeles International Airport. In Canada, Ressam reportedly 

supplemented his monthly welfare payments by stealing cash, credit cards, traveler’s checks, and 

passports in Montreal. Ressam was convicted once for theft, but he never was jailed. 

Transnational Criminal Activity 

According to the Canadian Royal Mounted Police’s annual reports from 1999 through 

2002, most of the major international organized crime groups are represented in Canada, 

including Asian, Eastern European, Italian, and Latin American organizations. The activities of 

these groups include drug trafficking, fraud, counterfeiting, money laundering, migrant and 

 

592 Bill Curry and Andrew McIntosh, “Ottawa Loses Track of 36,000 Deportees,” National Post [Toronto], 9 April 

2003. 

593 Stewart Bell, "Hezbollah Uses Canada as Base: CSIS Agency Wiretaps Show Suspected Operatives Using 

Laundered Money to Buy Materiel,” National Post [Toronto], 31 October 2002. 594 Bell, “Hezbollah Uses Canada as Base.” 
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contraband smuggling, and illegal gaming.595 Asian and East European based organized crime 

groups are the most active in Canada. 

In 1999 Canada’s Criminal Intelligence Service (CISC) reported that Asian organized 

crime groups operating in British Columbia included triads from Hong Kong and Taiwan; the 

mainland Chinese Big Circle Boys; the Lotus group, comprised mostly of Canadian born 

Chinese; and numerous other Vietnamese and Chinese gangs. Big Circle is the most active 

Asian organized crime group operating in Canada. These criminal organizations engage in a 

variety of enterprises, regularly sharing expertise and personnel. Asian groups continue to 

expand their association with other organized crime groups and criminal gangs at the regional, 

national, and international level. An example of the cooperation between groups is the use of 

Big Circle personnel by triad groups for enforcement.596 Big Circle is not itself a triad group, but 

many of its members belong to triads in the typical pattern of overlapping membership among 

Chinese groups. 

Based primarily in the urban centers of Vancouver, Calgary, Edmonton, Toronto and 

Montreal, Asian based organized crime groups are engaged in trafficking cocaine; the 

trafficking, production and exporting of marijuana; the importation and distribution of Southeast 

Asian heroin; and, recently, the production of the “designer drug” ecstasy.597

According to authorities, the importation of heroin is among the most profitable and 

prolific crimes committed by Asian groups in Canada. The importation of heroin with a purity 

as high as 99 per cent from Thailand and China is primarily controlled by the Big Circle in the 

Greater Toronto area. Vietnamese gangs are primarily responsible for its distribution. 

Asian groups also are involved in large-scale trafficking in migrants, using Canada as 

both a destination country and as a conduit to the United States. The Akwesasne Mohawk 

Territory, Walpole Island and the Niagara area are the routes favored for trafficking both goods 

and people into the United States.598

The two largest Hong Kong triads, 14K and Sun Yee On, have increased their presence in 

Canada in recent years and made substantial property investments during the 1990s. Prominent 

 

595 Royal Canadian Mounted Police, “RCMP Fact Sheets 2000-2001: Fact Sheet No. 9: Organized Crime.” 

www.rcmp-grc.gc.ca/pdfs/facts_2001_e.htm#factsno9www.rcmp-grc.gc.ca/pdfs/facts_2001_e.htm#factsno9 596 Margaret E. Beare, Criminal Conspiracies: Organized Crime in Canada (Nelson: Canada, 1996), 84. 597 “Asian-Based Organised Crime,” in Criminal Intelligence Service Canada, Annual Report 2002. 

<http://www.cisc.gc.ca/AnnualReport2002/Cisc2002/asian2002.html> 

598 “Asian-Based Organised Crime.” 
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14K members from Hong Kong and Macau have immigrated to Canada during this time, and 

Sun Yee On triad members have settled in Toronto, Edmonton, and Vancouver.599

East European organized crime groups, which include organizations from the former 

Soviet Union, Bulgaria, the former Yugoslavia, Hungary, Poland, and Romania, also are 

expanding their activities in Canada. Groups from the former Soviet republics tend to be the 

strongest. East European groups are particularly active in the urban centers of Ontario, Quebec, 

British Columbia, and the Maritime Provinces; they engage primarily in financial fraud through a 

variety of credit card schemes and Internet fraud, theft, contraband smuggling, illicit drug 

importation, vehicle theft and illegal export, and money laundering.600 Pragmatic relationships 

often are established with Asian groups and domestic motorcycle gangs to fulfill particular 

enterprises. 

Colombian cartels are responsible for the majority of the cocaine trafficked into Canada. 

These cartels are reported to have formed affiliations with Eastern European and Italian 

organized crime groups to distribute cocaine within Canada’s borders. Canada is a destination 

and a transit point to the United States for women, children, and men trafficked for purposes of 

sexual exploitation, labor, and the drug trade. Trafficked migrants originate primarily in China’s 

Fujian Province, 601 Southeast Asia, Eastern Europe, and Russia.602

The Royal Canadian Mounted Police Performance Report to Parliament for the years 

1999-2000 describes organized trans-border criminality of all types as thriving, with many 

organized crime groups now engaging in the trafficking of migrants. The links between 

organized crime groups and the trafficking of people are being "strengthened" as smugglers form 

agreements to transport illegal migrants from all over the world into Canada. According to a 

Toronto newspaper report, "Collaboration between trafficking organizations is evident, whereby 

ethnic and national groups interact, facilitating the provision of transport, safe houses, local 

contacts and travel documentation."603 The majority of illegal migrants continue to enter Canada 

 

599 “Asian Organized Crime,” in Federation of American Scientists, International Crime Threat Assessment 2000. 

<http://www.fas.org/irp/threat/pub45270chap3.html#r14> 

600 “East European-Based Organized Crime,” in Criminal Intelligence Service Canada, Annual Report, 2002.

<http://www.cisc.gc.ca/AnnualReport2002/Cisc2002/european2002.html> 601 Jennifer Bolz, “Chinese Organized Crime and Illegal Alien Trafficking: Humans as a Commodity,” Asian Affairs, 

22, no. 3 (Fall 1995). 

602 U.S. Department of State, Trafficking in Persons Report 2002. <http://www.state.gov.g/tip/rls/tiprpt/2002> 603 Andrew Mitrovica, “Gangs Unite to Capitalize on Human Smuggling,” The Globe and Mail [Toronto], January 8, 

2001. 
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by regular commercial international flights.604 Chapter II of the Report of the Special Senate 

Committee on Security and Intelligence explains how this is often done. Illegal migrants move 

into Canada by “losing” the identification they used to board an airplane, claiming refugee status 

when they arrive, and disappearing into a Canadian trafficking system upon their release. The 

trafficking system then either brings them underground in Canada or moves them across the 

United States border. 605

Smuggling illegal migrants is a multibillion-dollar business. Total earnings in Canada 

were estimated in 1995 at around US$3.2 billion per year. Alien smugglers are rarely prosecuted 

in Canada; for those who are, sentencing is much lighter than it is for narcotics trafficking. 

Migrants pay traffickers as much as US$50,000, much of which is repaid by labor in sweatshops 

or participation in another illegal activity.606

Recent Developments 

In response to the terrorist attacks of September 11, 2001, and revelations that terrorists 

have found safe haven within its borders, Canada has taken diplomatic and legislative steps to 

reduce the attractiveness of Canada as a destination or base for terrorists and international 

criminals. Among those steps was the Smart Border Declaration of 2001, which established a 

joint action plan for tightening border controls on both sides of the Canada-United States line. 

To minimize commercial delays, the plan includes a pre-screening system to allow frequent 

border crossers to enter and exit Canada quickly.607 In addition, in late 2002 Canada finally 

added Hamas, the Islamic Army of Aden, Harkat-ul-Mujahedeen, Asbat Al-Ansar, Palestinian 

Islamic Jihad, Hizballah, and Jaish-e-Mohammed to Canada’s list of terrorist groups, making 

fundraising for these groups illegal.608

In December 2001, the Canadian Parliament passed the Anti-Terrorism Act, which made 

perpetrating, financing, or contributing to terrorist activity a crime. The Act increases the 

 

604 “Asian-Based Organized Crime.” 605 Canada, Senate, Special Senate Committee on Security and Intelligence. 606 Bolz. 607 “Canada: Immigration, Asylum and US,” Migration News, 10, no. 1 (January 2003). 

http://migration.ucdavis.edu/mn/Archive_MN/jan_2003-06mn.html; and “New Screening Process Will Speed 

Traffic into Canada,” Canadian Press Newswire, Dec. 6, 2001. 608 Stewart Bell, “Liberals Relent, Hezbollah Outlawed: Graham Says It’s Due to Recent Evidence,” National Post

[Toronto], December 12, 2002. 
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government’s investigative powers, criminalizes fundraising and providing logistical support for 

terrorist activity in Canada or abroad, and provides recourses for freezing or seizing assets 

belonging to supporters or members of terrorist organizations. 

Because Canada’s immigration laws are arguably the foremost factor in making Canada 

hospitable to terrorists and international criminals, the changes to the existing system included in 

the Immigration and Refugee Protection Act, passed in June 2002, will make it more difficult for 

such individuals to gain entry or stay in Canada.609 The major changes in the law are the 

introduction of in-depth CSIS screening upon arrival in Canada rather than after a significant 

delay; establishment of nine factors, including misrepresentation of identity and connections with 

a terrorist or criminal group, as grounds for denial of entry into Canada; increased penalties for 

immigration offenses such as smuggling; measures to discourage fraudulent immigration 

applications; reduction of the appeal rights of individuals identified by authorities for deportation 

for having committed a crime; and increased authority to arrest foreign nationals suspected of a 

crime or terrorist act. 

Together these new laws have the ability to reduce the incentives and ability for terrorists 

and international criminals to operate in Canada. However, enforcement will be the key. 

Whether these new laws are effective in reducing the use of Canada as an operational base and 

transit country for terrorists and international criminals will depend in large part on whether a 

new balance between civil liberties and security concerns will yield effective prevention. As a 

possible first indication of future trends, in October 2002 three Filipinos received a two-year 

sentence for trafficking Chinese migrants into Canada, although the new Immigration and 

Refugee Protection Act calls for up to a ten-year sentence for such a crime.610

In September 2001 Bill Bauer, former member of the Canadian Immigration and Refugee 

Board, described the judicial approach to human trafficking that preceded the new legislation: 

“No judge who has tried a trafficker—and very few are ever arrested, let alone tried—has 

imposed a fine greater than $5,000.”611 The 2001 annual report by the CISC explains that 

investigation and prosecution of those involved in human trafficking often is difficult because 

 

609 Canada, Citizenship and Immigration, “Bill C-11 Immigration and Refugee Protection Act: What Is New in the 

Proposed Immigration and Refugee Protection Act,” July 2001. 

www.cic.gc.ca/english/irpa/c11%2Dnew.htmlwww.cic.gc.ca/english/irpa/c11%2Dnew.html 610 “Three Sailors Sentenced for Smuggling Chinese Migrants,” National Post [Toronto], 31 October 2002. 611 Ron Claiborne, “A Border Breached: Canada’s Immigration Laws Draw New Scrutiny,” 26 September 2001. 

www.abcnews.go.com/sections/world/DailyNews/claiborne_border010926.html 
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the trafficking organizations are transnational networks with subordinate members who shield 

their leaders.612 In order to change the current situation, the profit/risk calculations of the human 

traffickers must be altered. Only severe penalties can offset the very high potential profits of 

trafficking migrants into North America. 

The new Immigration and Refugee Protection Act has been criticized because it does not 

change the definition of "serious criminal" as applied to resident aliens. To fall into that category 

under the new law, an individual still must have received at least a ten-year prison sentence. 

Thus, for example, Ahmed Ressam would not be subject to deportation because he had only been 

convicted of petty thefts. 

Conclusion 

Canada has a well-deserved reputation as a protector of human rights, including the rights 

of non-citizens who are entering or leaving the country. That protection, together with Canada’s 

very long, loosely monitored border with the richest country in the world and its well-developed 

commercial, communications, and transportation infrastructures, has promoted the presence of 

criminal and terrorist groups and individuals. For terrorist groups, Canada has been a safe haven, 

transit point, and place to raise funds; for criminal groups Canada has provided a route for the 

trafficking of humans and various illegal commodities, many of which reach the United States. 

Canada’s new legislative initiatives have the potential to reduce the country’s appeal to 

terrorist organization, international organized crime groups and alien smugglers, as well as their 

ability to operate. However, the economic necessity of expedient movement of persons and 

goods across the US-Canadian border and Canada’s liberal democratic identity may continue to 

limit the adoption of security measures necessary to completely halt the operations of these 

groups. 

 

612 Canada, Criminal Intelligence Service, Annual Report on Organized Crime in Canada, 2001: Asian-Based 

Organized Crime. www.cisc.gc.ca/AnnualReport2001/ 
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Colombia 

Introduction 

Although Colombia has a long democratic tradition, it also has a history of political 

violence that has included six interparty wars in the nineteenth century and two more in the 

twentieth century. By far the most violent country in the Western Hemisphere, Colombia—

which also is the leading cocaine-producing country―remains mired in a morass of drug-related 

guerrilla, state, and paramilitary violence. Experts generally credit the regime of President 

Alvaro Uribe (inaugurated in 2002) with beginning to reduce violence during Uribe’s first year 

in office. 

In recent decades, three different types of nonstate subversive organization—guerrillas, 

paramilitary groups, and drug mafias—have been pitted in violent conflict against each other, the 

government, or both. Major left-wing guerrilla groups have been waging violent conflict since 

the 1960s. Beginning in the 1980s, this insurgency was exacerbated by the anti-guerrilla 

activities of a right-wing paramilitary organization, the United Self-Defense Forces of Colombia 

(Spanish initialism ACCU), which now forms the center of a fast-growing umbrella organization. 

At the same time, organized crime has fuelled warfare by a variety of mutually beneficial support 

activities carried on with the other groups. These relationships have created a certain 

interdependency between narcotics trafficking groups on one side and guerrilla and paramilitary 

groups on the other. Although the government dismantled the country’s two major cartels in the 

1990s, many smaller groups emerged and have continued to operate with impunity. Colombian 

narcotics groups have established significant ties with foreign organizations for the sale of 

narcotics, the laundering of money, and the acquisition of arms. 

Contributing Factors 

Geographical Factors

Colombia’s location at the gate of South America, bordering Panama and the Caribbean 

Sea, traditionally has facilitated trafficking in narcotics and other types of contraband. Colombia 

is the only South American country with coastlines on both the Caribbean and the Pacific Ocean. 
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Trafficking and illegal transit also are facilitated by the fact that the borders with all of 

Colombia’s five neighboring countries traverse largely unpopulated jungle regions. 

Institutional Factors

Beginning in the 1970s, a booming narcotics trade spread corruption in Colombia’s 

military and law enforcement agencies, undermining public confidence in those institutions.613

By the 1980s, all three types of violent groups (guerrillas, paramilitaries, and narcotics 

traffickers) were challenging government authority. The justice system especially has sagged 

under the weight of corruption and narco-terrorism in the decades that followed. As Colombia’s 

homicide rate was rising sharply in the 1980s and the 1990s, by 1996 conviction rates for 

homicide dropped from 11 percent to 4 percent of total incidents.614 A complex interdependency 

exists between Colombian guerrillas and narcotics traffickers, based on the guerrillas’ protection 

of cultivation and processing operations and the sources from which traffickers make their 

purchases. Because the fundamental interests of the two groups are irreconcilable, however—the 

traffickers are capitalists, whereas the guerrillas’ ideology is anti-capitalist—the two have been 

in conflict.615

Scholars generally agree that alliances exist among narcotics traffickers, large 

landowners, multinational corporations, industrial groups, and agencies and individuals of the 

state. The last group includes corrupt politicians, members of Congress, judicial and other 

government officials, and members of the military.616 Many members of the armed forces are 

known to cooperate with narcotics traffickers. Aside from corrupt connections, Colombia’s 

military as an institution has not viewed narcotics traffickers as a threat to society, and traffickers 

often have supported the military’s counterinsurgency efforts. 

The narcotics earnings and narco-terrorism that have accompanied Colombia’s drug 

industry have strengthened the tradition of domestic and international companies creating private 

 

613 Harvey F. Kline, “Colombia: Lawlessness, Drug Trafficking, and Carving Up the State,” in Robert I. Rothberg, 

ed., State Failure and State Weakness in a Time of Terror (Washington, D.C.: Brookings Institution Press, 2003), 

176. 

614 Mauricio Rubio, “Violence, Organized Crime, and the Criminal Justice System in Colombia,” Journal of 

Economic Issues, 32, no. 2 (June 1998): 605-10. 615 Nizani Richani, Systems of Violence: The Political Economy of War and Peace in Colombia (Albany, New York: 

State University of New York Press, 2002), 109. 

616 Richani, 56. 
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security forces.617 Since their government authorization in 1994, these military-dominated forces 

have proliferated throughout the country, adding another layer of paramilitary activity and often 

themselves becoming involved in criminal activities.618

According to political economist Nizih Richani, contraband and narcotics trafficking 

have thrived in Colombia because of a combination of dire economic conditions and a fourdecade insurgency that has prevented the state from extending its authority over all of 

Columbia’s national territory. The state’s presence is especially weak in the five states 

containing the largest coca plantations. According to Richani, the ongoing success of guerrilla 

forces has offered protection and encouragement to peasant and commercial farms that shift from 

conventional crops to coca cultivation.619

Government corruption has played a significant role in supporting criminal activities in 

Colombia. The 2002 Corruption Perceptions Index (CPI) of Transparency International (TI) 

placed Columbia 57th among the countries evaluated.620 According to TI, “Colombia has suffered 

the tragic consequences of endemic theft by politicians and public officials for decades.”621 In its 

Global Corruption Report, TI cites a World Bank survey of 2002, which found that 50 percent of 

state contracts in Colombia involve bribes. TI concludes, “....this behavior [has] exacerbated 

underdevelopment and lawlessness in the countryside.”622

Economic Factors

Analysts believe that many Colombians have resorted to growing coca (the base crop for 

cocaine production), trafficking in drugs, and joining armed groups as a result of poverty and 

high unemployment (13.8 percent at the end of 2001, but as high as 35 percent among youths 18 

to 24 years old) and social factors such as the massive internal displacement of the rural 

population. In 2001 Colombia’s per capita gross domestic product was only US$1,821, and an 

 

617 Richani, 50-51. 618 “Colombian Self-Defense,” Americas.org report, November 2000. 

<http://www.americas.org/News/Features/200011_Private_Security/Colombia.asp> 619 Richani, 95. 620 Transparency International, Corruption Perceptions Index 2002. <http://www.transparency 

.org/cpi/2002/cpi2002.en.html> 

621 Eduardo Wills Herrera and Nubia Urueña Cortés, “South America,” in Transparency International, Global 

Corruption Report 2003, 108. 622 Herrera and Cortés, 108. 
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estimated 55 percent of the population was below the poverty line.623 Armed groups and 

narcotics traffickers are believed to recruit many young members who are unemployed or 

displaced. (Colombia is third in the world in number of internal refugees.)624

In 1999 the estimated total value of contraband originating from, arriving in, or transiting 

Colombia reached US$2.2 billion, after having doubled over the previous decade. This amount 

accounted for 25 percent of the value of the country’s total imports and 50 percent of its total 

exports. This significant economic contribution explains why contraband has the protection of 

powerful groups that include politicians, business organizations, customs authorities, and the 

mainly Japanese and Korean multinational corporations that provide the contraband goods.625

Narcotics 

Colombia remains the world’s leading producer and distributor of cocaine base and 

cocaine, manufacturing nearly 80 percent of the world’s cocaine hydrochloride in 2002.626

Colombia also is the primary supplier of heroin to the United States. In addition to the large 

amounts of cocaine base produced domestically, Colombian traffickers import that substance 

from Peru and Bolivia and process it into cocaine hydrochloride. Both Colombia’s Caribbean 

and Pacific coasts are major transshipment points for large shipments of cocaine and cannabis, 

much of which is carried to Mexico and other destinations on fishing vessels and speedboats. 

The major production region is eastern Colombia; organizing cartels are centered in Bogota, 

Cali, Medellin, and other cities. Most of the Colombian heroin that reaches the United States 

comes via couriers on commercial airlines.627

In addition to supporting independent narcotics traffickers and cartels, the drug trade is a 

major source of funding for guerrilla group Revolutionary Armed Forces of Colombia (Spanish 

initialism FARC) and the paramilitary United Self-Defense Forces of Colombia (Spanish 

initialism AUC). A second guerrilla group, the National Liberation Army (Spanish initialism 

 

623 Economist Intelligence Unit, Colombia: Country Profile 2002 (London: 2002), 31, 65; and U.S. Central 

Intelligence Agency, The World Factbook 2002 (Washington, D.C.: 2002), 114. 624 Julia E. Sweig, “What Kind of War for Colombia?” Foreign Affairs, 81, no. 5 (September-October 2002): 125. 625 Richani, 101. 626 Eric Green, “U.S. Says Colombia Remains World’s Leading Producer of Cocaine: State Dept. Details Illicit Drug 

Activities in Americas and World,” U.S. Department of State International Information Programs report, 3 March 

2002. <http://164.109.48.86/topical/global/drugs/03030302.htm> 

627 U.S. Department of State, Bureau for International Narcotics and Law Enforcement Affairs, International 

Narcotics Control Strategy Report 2003, IV-24. 
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ELN) has been active in narcotics trafficking to a lesser degree only since 1998. According to 

military information, in 2001 at least 32 of the FARC’s 61 fronts and 7 of the ELN’s 41 fronts 

were known to derive income from the drug trade.628 Since 1999, the FARC reportedly has 

sought to establish a monopoly position over access to coca and sales of cocaine base to cartels 

in much of southern Colombia.629

The FARC also is believed to be involved in opium poppy cultivation, the techniques of 

which were learned from Afghani and Pakistani traffickers. Colombian police sources report that 

dozens of Afghans, using false Pakistani passports, have been involved in processing heroin in 

Colombia.630 However, although Colombia is the largest producer of opium poppy in South 

America, its highest output in 2001 was only 2 percent of the world’s total, and output has begun 

to decline.631

Despite extensive involvement in the narcotics trade, Colombia’s guerrilla and 

paramilitary groups are not close partners of the country’s drug cartels. The organizations 

cooperate only when both sides have something to gain. Political scientist Patricia Bibes explains 

the relationship: “The guerrillas provide security assistance and defense to the drug traffickers, 

and the drug traffickers provide financial aid to the guerrillas in return.”632 However, according 

to law enforcement expert James Van de Velde, by the mid-1990s “taxation” and protection of 

drug farmers and traffickers had become the primary financial support of guerrilla 

organizations.633

Paramilitary Groups 

Right-wing paramilitary organizations emerged in Colombia, with subtle backing from 

the military, to protect the interests of regional elites. However, the existence of paramilitaries 

 

628 Angel Rabasa and Peter Chalk, Colombian Labyrinth: The Synergy of Drugs and Insurgency and Its Implications 

for Regional Stability (Santa Monica, California: Rand, 2001), 32. 629 “Colombian Rebel Connection to Mexican Drug Cartel,” U.S. Department of State statement, 29 November 

2002. <http://164.109.48.86/topical/global/drugs/00112901.htm> 

630 Martin Arostegui, “Search for Bin Laden Links Looks South,” United Press International report, 12 October 

2001. <http://www.autentico.org/oa09505.html> 

631 “Opium Poppy Cultivation in Colombia Down by 25 Percent, Says ONDCP,” U.S. Department of State 

International Information Program report, 13 May 2003. <http://164.109.48.86/topical/global/drugs/03051301.htm> 

632 Patricia Bibes, “Colombia: The Military and the Narco-Conflict,” Low Intensity Conflict & Law Enforcement, 9, 

no. 1 (Spring 2000): 41. 

633 James R. Van de Velde, “The Growth of Criminal Organizations and Insurgent Groups Abroad Due to 

International Drug Trafficking,” Low Intensity Conflict & Law Enforcement, 5, no. 3 (Winter 1996): 471. 
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has only exacerbated conflict. At times the state has attempted to deal with its leftist guerrilla 

groups by enlisting the help of paramilitary organizations.634

Beginning in the 1980s, the ACCU and the umbrella AUC to which it belongs have 

funded themselves increasingly by narcotics trafficking.635 Estimates of funding amounts vary 

widely. According to Colombian military sources, eight of the AUC’s 19 fronts derive income 

from this source.636 According to the U.S. Drug Enforcement Administration (DEA), AUC 

leader Carlos Castaño is linked to Colombia’s current top drug cartel, the Henao Montoyo 

organization.637

The AUC is the fastest-growing armed organization in Colombia. Its constituent ACCU 

claims to have 15,000 troops. Many members are former police and military personnel who were 

discharged for human rights abuses. The AUC’s strongholds are in rural areas where federal 

forces are few. 

Transnational Narcotics Ties 

In 2001 the commander of the Colombian Armed Forces reported that Russian criminal 

organizations had sent 10,000 AK-47 rifles to the FARC through Brazilian narcotics dealer 

Fernando Da Costa. In return, the FARC helped Da Costa to move large shipments of cocaine 

from Colombia to Brazil. Prior to his arrest in 2001, Da Costa allegedly also channeled arms 

from Paraguay-based Lebanese importer Fuad Jamil to FARC and other groups, including 

Hizballah.638 According to another report, the FARC received a similar shipment of Russian AK47s from the arms trafficking organization of Vladimiro Montesinos, who was then head of 

Peru’s National Intelligence Agency.639

 

634 Nizih Richani, Systems of Violence: The Political Economy of War and Peace in Colombia (Albany, New York: 

State University of New York Press, 2002), 102-03. 

635 Richani, 108. 636 Rabasa and Chalk, 32. 637 U.S. Department of State, Bureau for International Narcotics and Law Enforcement Affairs, International 

Narcotics Control Strategy Report 2002. <http://www.state.gov.g/inl/rls/nrcrpt2002/html/17944.htm> 638 Louis Esnal, “Nexos con Montesinos” [Nexus with Montesinos], La Nacion [Buenos Aires], 24 April 2001, 2; 

and Eleonora Gosman, “Temen una Guerra entre bandas de narcos en Brasil” [Drug Cartel Wars Are Feared], Clarín 

[Buenos Aires], 24 April 2001. 

639 Bruce Michael Bagley, Globalization and Transnational Organized Crime: The Russian Mafia in Latin America 

and the Caribbean, School of International Studies, University of Miami, 31 October 2001 

,http://www.mamacoca.org/feb2002/art_bagley_globalization_organized_crime_en.html#fn1> 
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Arrests made by Mexican authorities in November 2000 established links between the 

FARC and Mexican cocaine traffickers. Evidence showed that the FARC had tried to supply 

cocaine to the Mexican Tijuana cartel in exchange for cash and possibly weapons.640 The 

Cárdenas-Guillén cartel of northern Mexico is known to have maintained a pipeline for 

Colombian cocaine, which the group shipped across the border into the United States. In May 

2003, AUC and FARC operatives reportedly had arrived in Mexico to maintain Mexican drug 

routes after the arrest of key Mexican figures.641

The Aruba-based Mansur clan runs a trafficking empire that was founded by the Cali 

cartel and a Cosa Nostra clan. According to a lawsuit filed in 2000 against the Philip Morris 

Tobacco Company by the governors of 25 of Colombia’s states, the Mansur company sold 

tobacco products to traffickers in exchange for narcotics profits. When those products were 

smuggled into Colombia, the pesos earned by the subsequent sale of the products went into the 

Colombian bank accounts of the narcotics traffickers who had generated the initial profits. This 

transaction was the final stage in the money laundering operation known as the Black Market 

Peso Exchange, which connected profits from the United States market with the Colombian 

cartels.642 A Syrian-Lebanese clan leader, Mohamed Ali Farhad, has been linked to money 

laundering activities of the Mansur company and has been investigated for using profits from 

arms and narcotics trafficking to fund Islamic fundamentalist groups, including Hizballah.643

Non-Indigenous Organized Crime 

According to official documentation, Colombia has been a transit or base point for the 

operations of some foreign criminal groups. Solntsevo, one of Russia’s largest criminal 

organizations, established ties with Colombian narcotics traffickers in 1992. In the early 1990s, 

Solntsevo granted the Cali cartel of Colombia the right to distribute cocaine throughout Russia 

and to use Russia as a base for distribution in Eastern Europe.644 In the second half of the 1990s, 

Colombian narcotics traffickers began receiving small-scale weapons from Russia in exchange 

 

640 “Colombian Rebel Connection to Mexican Drug Cartel.” 641 “Colombian Paramilitary Group Denies Connections with Drug Trafficking,” El Universal [Mexico City], 5 May 

2003 (FBIS Document LAP20030505000102). 

642 “The Black Market Peso Exchange.” <http://scolar.vsc.edu:8003/VSCCAT/ACR-1669> 643 Fabio Castillo, “The Hizballah Contacts in Colombia,” El Spectador [Bogota], 9 December 2001 (FBIS 

Document LAP20011210000036). 

644 “The Russian Connection,” Cambio 16 [Madrid], 6 October 1997 (FBIS Document 98L01001A). 
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for a percentage of the Colombian narcotics output. In 1999 and 2000, Russian crime groups are 

believed to have strengthened their alliances with new Colombian cartels such as Costa, Norte 

del Valle, and Los Llanos.645

Terrorist Groups 

The Department of State’s Bureau for International Narcotics and Law Enforcement 

Affairs calls the FARC “the hemisphere’s largest and oldest terrorist group.”646 Although some 

exchanges have occurred with a branch of the Irish Republican Army,647 the FARC’s terrorist 

activities largely have been confined to domestic acts such as the hijacking of a domestic 

commercial flight, the kidnapping of a presidential candidate, the kidnapping and assassination 

of a former minister of culture, and the kidnapping of three U.S. contractors whose plane crashed 

in FARC-dominated territory. In 1999 the FARC also killed three American missionaries 

working in Colombia. The smaller ELN has kidnapped wealthy Colombians for ransom and 

bombed and extorted multinational and domestic oil companies.648

Occasional reports have indicated the presence of Islamic fundamentalist terrorists in 

Colombia. Mohamed Abed Abdel Aal, a leader of the al Qaeda-affiliated Egyptian Islamic Jihad 

(Jama’a Islamiyya), who was arrested in Colombia in 1998, allegedly had participated in 

transactions with Colombian guerrillas involving arms, drugs, and money.649 In January 2000, 

Colombian intelligence officials reportedly believed that another Egyptian terrorist suspect, 

Muhammed Ubayd Abd-al-Al, could have taken refuge in Maicao, Colombia. Maicao, a city 

near the border of Venezuela, has an Islamic community whose size has been estimated between 

4,670 and 8,000. That community comprises the largest and best organized Arab community in 

Colombia. It is known that a well-established black market for weapons and money laundering 

exists in Maicao and the neighboring Venezuelan state of Zulia.650

 

645 Alirio Fernando Bustos, “Cayό official de la Armada, su principal enlace: La avanzada de la mafia rusa” [A 

Retired Navy Officer, Its Principal Liaison, Is Arrested: The Advance of the Russian Mafia], El Tiempo [Bogota], 8 

February 1999. 

646 U.S. Department of State, International Narcotics Control Strategy Report 2003, IV-19. 647 Center for Defense Information Terrorism Project, “Globalizing Terrorism: The FARC-IRA Connection,” 5 June 

2002. <http://www.cdi.org/terrorism/farc-ira-pr.cfm> 648 Council on Foreign Relations and Markle Foundation, “FARC, ELN, AUC: Colombia, Rebels.” 

<http://www.terrorismanswers.com/groups/farc.htm> 649 “Egyptian Suspect in Luxor Attack Arrives in Ecuador,” The Daily Telegraph [London], 21 October 1998. 650 Castillo. 
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Individuals of Arab descent—possibly affiliated with the radical group Hizballah— 

reportedly control 70 percent of local commerce in Maicao. According to a Colombian 

journalist, Hizballah cells in the city have used the money-laundering networks of narcotics 

traffickers to disguise money that will finance worldwide terrorist operations. Nationalized Arabs 

who serve as money-laundering couriers have easily obtained Colombian citizenship. The only 

requirement is two witnesses to verify that an individual was born in Colombia.651

Conclusion 

Transnational criminal groups and, to a lesser extent, terrorist organizations have taken 

advantage of the chronically corrupt and violent environment that Colombia presents. Political 

and judicial reform have not been possible in a system that is controlled by a small elite and has 

strong links to elements of a thriving narcotics trade. Narcotics-related corruption in the military 

and law enforcement agencies has undermined public confidence in those institutions. In this 

environment, powerful guerrilla and paramilitary forces control parts of the country and are 

increasingly linked with narcotics trafficking activities. The sale of narcotics, the arming of 

illegal organizations, and the laundering of profits from narcotics sales are activities that bring 

indigenous groups into cooperation with transnational criminals. There is evidence that some of 

the exchanges of narcotics, arms, and money also have involved Middle Eastern terrorist 

organizations. 

Mexico 

Introduction 

Mexico’s suitability as a safe haven for transnational criminal and terrorist groups is 

determined by a variety of factors. Those conditions include geographic proximity and ease of 

access to the United States; the presence of extra-regional immigrant communities; the volume 

and sophistication of domestic commercial activity; the volume and ease of trans-border 

movements of goods, persons and cash; the presence of an established criminal infrastructure; 

the regulatory environment, transparency, and corruptibility of Mexican institutions; and the 

capabilities of local law enforcement agencies. From the specific perspective of terrorist 

 

651 Castillo. 
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organizations, the most important factors are opportunities for the clandestine movement of 

persons; fundraising and money laundering opportunities; and the existence, vulnerability, and 

perceived value of potential targets in Mexico. 

Mexico’s status as the second-largest supplier of U.S. merchandise imports (after 

Canada), the single largest source of immigrants to the United States, and the most popular 

foreign tourist destination for Americans imply a level of shared vulnerability rivaled by few 

other pairs of contiguous nations. Since the mid-1980s, rapid growth in travel between Mexico 

and the United States and the expansion of trans-border commerce under the North American 

Free Trade Agreement (NAFTA) have dramatically increased the interdependence of the two 

nations in security matters, placing new emphasis on factors such as border controls and 

distribution of drug precursor chemicals.652

Factors in Organized Crime and Terrorism 

Border Control

Mexico is a major travel destination and air travel hub for Latin America, as well as the 

biggest source of overland passenger vehicle and pedestrian traffic entering the United States. 

Under these conditions, flaws in Mexico’s visa and border control systems attract the attention of 

criminal groups. Increased cross-border vehicle traffic, which began in the mid-1990s, has 

facilitated a variety of transnational criminal activities including the bulk movement of illicit 

drugs and cash across the United States-Mexico border. Commercial traffic in particular has 

grown rapidly since the passage of NAFTA. According to the U.S. Department of 

Transportation, the annual number of truck crossings from Mexico into the United States grew 

from 2.8 million in 1994 to 4.3 million in 2001. However, the volume of personal vehicle traffic 

between Mexico and United States, which by 1999 reached 90 million northbound personal 

vehicle crossings, also has been a significant factor in making extensive border screening 

impractical.653

Tractor- trailers and cars with hidden compartments frequently are used to smuggle drugs 

out of Mexico into the United States; then the same vehicles are packed with the profits from the 

 

652 David Beard, “NAFTA: Bad Flows in Along with the Goods,” Salt Lake Tribune, 19 April 1997, A1. 653 U.S. Department of Transportation, Bureau of Transportation Statistics. <http://www.transtats.bts.gov> 
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street sale of the drugs and returned to Mexico. Car thieves, smugglers, and money launderers 

know that vehicles heading south encounter less scrutiny at the border than northbound vehicles 

because the attention of U.S. Customs and immigration inspectors is focused on northbound 

traffic.654 Mexican criminal organizations historically have relied on corruption and 

understaffing on both sides of the border to move their illicit cargoes to their destinations. These 

smuggling activities, which have traditionally been dominated by local Mexican border gangs, 

are increasingly attracting non-Mexican criminal groups as well. 

Mexico is the primary source and transit country for undocumented migrants entering the 

United States. According to the 2000 United States census, Mexicans represent about 4.7 million 

(55 percent) of the total undocumented population in the United States. Mexico also is the 

primary transit zone for illegal migrants moving from Central America to the United States. In 

2001 Mexican authorities apprehended more than 151,000 individuals in this category, 655 mostly 

from Guatemala, Nicaragua, and Honduras. Some of Mexico’s extra-regional migrants also 

arrive at Mexican and Central American ports of entry with the assistance of transnational alien 

smuggling rings. In 2001, Mexico apprehended 1,843 undocumented migrants classified as nonLatin American.656 Mexico currently is not a major destination for legal immigrants. After the 

tightening of asylum policies in the 1990s, only 5,828 immigrants were legally admitted during 

2002, mainly from Latin America.657

The Indigenous Criminal Infrastructure

The large, sophisticated indigenous criminal organizations in Mexico have attracted 

attention as potential partners for transnational organized crime and terrorist organizations 

seeking to establish a foothold in the Western Hemisphere. In addition to possessing vital local 

knowledge, Mexico’s criminal gangs and syndicates offer a variety of criminal “skill-sets,” such 

 

654 Edward M. Guillen, Chief of Financial Operation, U.S. Drug Enforcement Administration, statement to House 

Subcommittee on Criminal Justice, Drug Policy, and Human Resources, 23 June 2000.” 

<http://www.usdoj.gov/dea/pubs/cngrtest/ct062300.htm> 

655 Instituto Nacional de Estadística, Geografía e Informática [Mexico City], Estadísticas Sociodemográficas, 

Atención y Control de Indocumentados, 2002 [Sociodemographic Statistics: Illegal Alien Processing and Control]. 

<http://www.inegi.gob.mx/estadistica/espanol/sociodem/gobernacion/gob_04.html> 656 George W. Grayson, Mexico’s Forgotten Southern Border (Washington, D.C.: Center for Migration Studies, 

2002). 

657 “Documentación de Inmigrantes” [Documentation of Immigrants], Mexico City: National Migration Institute, 

2003. <http://www.inm.gob.mx> 
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as border smuggling and document falsification skills, which could be harnessed by a foreign 

partner. Mexico’s narcotics trafficking organizations are known to collaborate with extraregional partners as well as with the Colombian cartels. At least two of the larger drug 

syndicates, the Arellano Felix and Carrillo Fuentes organizations, have worked with Russian 

organized crime partners.658

Russian criminal organizations have discovered that linkages with one or more of the 

seven principal Mexican criminal organizations allow them to obtain drugs at low prices and 

under relatively secure circumstances. In order to maintain a low profile, Russian mafia groups 

in Mexico often operate out of resorts, hotels, or houses protected and owned by their Mexican 

associates. Beginning in the late 1990s, the growing importance of the Pacific route as the most 

reliable maritime corridor for Colombian cocaine bound for Mexico created a demand for the 

types of open-sea transportation services that Russian and Ukrainian mafia organizations were 

well positioned to provide. Similarly, some of the Mexican alien smuggling networks are 

believed to have partnerships with Asian, Middle Eastern, Russian, and Ukrainian human 

smuggling and trafficking rings.659

The desire of Mexican criminal groups for foreign partners is counterbalanced by a 

reluctance to attract the attention of Mexican and United States law enforcement and intelligence 

agencies. The increasingly strategic outlook of Mexican narcotics trafficking organizations 

reduces the likelihood that they would cooperate knowingly with extra-regional criminal or 

terrorist groups.660 However, smaller criminal gangs emerging in Mexico may be less 

discriminating in choosing foreign partners. 

Institutionalized Corruption

A tradition of official corruption and influence peddling throughout the seven-decade rule 

of the Institutional Revolutionary Party (Partido Revolucionario Institucional–PRI) has been a 

significant factor in promoting criminal activity at various levels. Mexico’s twentieth-century 

 

658 Ramón Miró, Organized Crime and Terrorist Activity in Mexico: 1999-2002, (Report prepared by the Federal 

Research Division, Library of Congress, under an Interagency Agreement with the Crime and Narcotics Center, 

Director of Central Intelligence, February 2003). 

659 Bagley; Gretchen Peters, "Drug Trafficking in the Pacific Has a Distinct Russian Flavor," San Francisco 

Chronicle, 30 May 2001; and Federal Bureau of Investigation, Los Angeles Field Office, "19 Linked to Eurasian 

Crime Ring Named in Federal Complaint for Alien Smuggling," press release, 3 May 2001. 

660 Mirό, Organized Crime and Terrorist Activity in Mexico: 1999-2002.
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history as a centralized authoritarian regime with heavy state regulation of the economy created 

opportunities for domestic organized crime groups to function as purveyors of contraband, 

influence, and evasion and protection services. Organized crime groups historically have relied 

on large-scale bribery of politicians, civil servants, and law enforcement personnel to protect 

their criminal enterprises. For example, former drug kingpin Juan García Abrego claimed to have 

spent up to US$50 million per month to buy protection from Mexican law enforcement and 

judicial officials during the 1980s.661

The political influence of organized crime in Mexico peaked during the administration of 

President Carlos Salinas de Gortari (1988-94). According to organized crime expert Louise 

Kelley, during the Salinas years “drug traffickers acquired unprecedented influence at high levels 

of the national government as well as at the level of regional governorships.”662 Lingering public 

anger at the Salinas-era scandals contributed to the defeat of the PRI during the 2000 presidential 

elections, which ended seven decades of single party control over the executive branch. 

Deep structural reforms introduced by the Salinas administration eliminated the rationale 

for organized crime activity based on evasion of burdensome government regulations and tariffs. 

At the same time, the reforms opened up new channels for criminal participation in the newly 

liberalized economy.663 According to regional experts, a politicized and poorly regulated 

privatization effort during the late 1980s and early 1990s allowed investors linked to Mexican 

and possibly foreign organized crime groups to expand their holdings within the legal 

economy.664

Drug-related corruption and violence have eroded public trust in Mexico’s law 

enforcement agencies. Much of the public animosity toward the police stems from personal 

experience of solicitation of bribes by police, poor or nonexistent police response to emergency 

calls, and soaring levels of street crime in major cities. In 2001, Transparency International rated 

Mexico nineteenth out of 23 countries in perceived police corruption.665 Several high-profile 

police scandals have underscored the apparent intractability of the police corruption problem. 

 

661 “Drug Lord, Now in U.S. Custody, Has Key to Mexican Corruption,” Money Laundering Alert, February 1996. 

<http://www.moneylaundering.com> 

662 Louise Kelley, “Corruption and Organized Crime in Mexico in the Post-PRI Transition,” Journal of 

Contemporary Criminal Justice 17, No. 3, August 2001, 216. 663 Kelley, “Corruption and Organized Crime in Mexico,” 217. 664 Fabre, Guilhem, Criminal Prosperity: Drug Trafficking, Money Laundering and Financial Crisis after the Cold 

War (London: Routlege-Courzon, 2003); and Kelley. 665 Kevin Sullivan, “For Many in Mexico, Bribes a Way of Life,” Washington Post, 30 October 2001. 
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According to a 2002 poll cited in the newsweekly The Economist, public confidence in the police 

is so low that four-fifths of all crimes in Mexico never are reported.666

Criminal Activity 

Finance-Related Crime

In the 1980s and early 1990s, market-oriented structural reforms transformed Mexico’s 

economy from a highly protectionist, public-sector-dominated system to a generally open, 

deregulated “emerging market” with extensive ties to the United States, Asia, and Europe. This 

transformation provided new opportunities for criminal organizations to engage in cross-border 

narcotics trafficking, human smuggling, and money laundering. At the same time, liberalization 

and deregulation of the economy made obsolete many of the tax and tariff evasion services that 

domestic crime syndicates had provided in the past. Criminal organizations’ role as 

intermediaries between the Mexican state and the Mexican private sector was reduced, while at 

the same time their activities aimed at the United States expanded as cross-border trade, 

financial, and demographic links grew. 

The privatization of the financial services sector gave Mexico one of Latin America’s 

most extensive banking systems, consisting of a central bank and six types of banking 

institutions. Money laundering expert Guilhem Fabre points to incremental investment in newly 

privatized banks and stocks as the “driving force” behind the economic ascent of Mexico’s drug 

traffickers during the 1990s.667

Cross-border financial transactions between Mexico and the United States have grown 

rapidly since the mid-1990s. The volume of such transactions provides criminal organizations 

ample opportunities to conceal profits from illicit activities among legal money flows. Mexican 

immigrants traditionally have relied on the same wire remittance services used by criminal 

organizations to send money earned in the United States back to Mexico to support their families 

The value of family remittances to Mexico alone increased from US$5.9 billion in 1999 to 

US$9.8 billion in 2002.668 This expansion in the volume of remittances poses an ever-growing 

 

666 “Crime in Mexico,” The Economist [London], 26 June 2003. <http://www.economist.com> 667 Fabre, Criminal Prosperity: Drug Trafficking, Money Laundering, and Financial Crises After the Cold War, 

114. 

668 “Remesas,” Instituto Nacional de Migración, 2003 [Mexico City]. <http://www.inm.gob.mx> 
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challenge to law enforcement agencies seeking to combat the illicit money transfer schemes that 

utilize the same routes. 

A common method used by criminal organizations to smuggle illicit proceeds into 

Mexico is the use of bank deposits and wire transfer services to conduct multiple small transfers 

to financial institutions in Mexico. In order to avoid mandatory documentation of their large 

transactions, money launderers break up cash shipments into transfers smaller than the reporting 

minimum. Accomplices move the cash into the system, concealing the transfers among the 

billions of dollars of legal remittances sent by Mexican immigrants to their families in 

Mexico.669

Once the United States currency arrives in Mexico, it is converted into pesos in a variety 

of money service business (MSBs) such as wire remittance services, cashier check companies, 

and money exchange house.670 These MSBs, a form of financial service organization that came 

into existence during the financial reform of the 1980s and 1990s, function as a parallel banking 

system with the capability to transfer funds into any banking system worldwide. 

Narcotics

Mexico’s advanced chemical and pharmaceuticals industries, along with its expanding 

international trade links, have facilitated the diversion of essential chemicals from legitimate 

industry in Mexico to supply cocaine and heroin processing operations in Colombia and 

elsewhere. According to the DEA, many of the chemicals necessary for the clandestine 

manufacture of illicit drugs also are available in Mexico.671 Legally imported precursor 

chemicals from the United States, Europe, and Asia are diverted to clandestine narcotics 

laboratories. Large-scale Mexican drug traffickers have established routes to procure and 

smuggle precursors from the international market for the manufacture of methamphetamine and 

amphetamine in Mexico. 

 

669Ginger Thompson, “Migrants to the U.S. are a Major Resource for Mexico,” New York Times, 25 March 2002; 

and Stephen Fidler, “New Migrants Spur Growth in Remittances,” Financial Times 17 May 2001. 670 Organisation for Economic Co-operation and Development, Financial Action Task Force on Money Laundering, 

FATF-XI Annual Report: 1999-2000, 26 March 2001. <http://www.fatf-gafi.org> 671 U.S. Department of Justice, Drug Enforcement Administration, Mexico Country Brief, July 2002. 

<http://www.usdoj.gov/dea/pubs/intel/02035/02035p.html> 
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According to the DEA, the majority of ephedrine shipments destined for Mexico are 

supplied by sources in China, India, the Czech Republic, the United Arab Emirates, Thailand, 

and Switzerland. In addition, large quantities of the essential chemical potassium permanganate 

have been diverted in Mexico to supply cocaine-processing laboratories in Colombia. Between 

1999 and 2002, at least seven seizures of Mexican-origin potassium permanganate, totaling more 

than 50 tons, were reported in Colombia.672 Another essential chemical, acetic anhydride, is 

manufactured in Mexico for multiple uses in legitimate industry. However, supplies of acetic 

anhydride are diverted from legitimate sources and made readily available to supply heroinprocessing laboratories in Mexico. 

Although Mexico has signed international chemical-control treaties such as the 1988 

United Nations Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic 

Substances and passed a Comprehensive Chemical Control Law in 1997, the DEA reports that 

implementation and enforcement of some provisions remains problematic. In addition, 

jurisdictional conflicts among agencies with anti-narcotics authority significantly impede 

chemical investigations. Few significant chemical prosecutions have occurred in Mexico since 

the law was enacted in 1997.673

Mexico has also become a profitable drug and alcohol consumption market. According to 

Mexico’s 2002 National Addictions Survey, out of a total population of 100 million about 3 

million people have used illicit narcotics. Drug retailing organizations that cater to Mexican 

cocaine and heroin users have become increasingly visible throughout Mexico. One of the largest 

such organizations, based in the Mexico City suburb of Ciudad Nezahualcóyotle (Ciudad Neza), 

was disrupted in November 2002, when its kingpins, Delia Patricia Buendía and Carlos Morales 

Correa, were arrested by Mexican federal police. The Buendía gang, which has ties to the three 

major Mexican cartels, disposed of “surplus” cocaine belonging to the cartels by selling it in the 

local Mexico City street market.674

 

672 International Narcotics Control Board, report on the Implementation of Article 12 of the United Nations 

Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances of 1988, 2002. 

<http://www.incb.org> 

673 U.S. Department of Justice, Mexico Country Brief. 674 Ignacio Alzaga, “Atentados en EU fortalecieron operaciones del cartel de Neza [Attacks on the U.S. 

Strengthened Neza Cartel Operations], El Sol de Mexico [Mexico City], 30 August 2002. 
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Trafficking in Consumer Goods

Mexico’s growing consumer economy provides substantial profit-making opportunities 

for foreign groups trafficking in stolen, counterfeit, and smuggled goods. Recent research has 

indicated that counterfeiting and piracy attract transnational criminal and terrorist organizations. 

Mexico’s National Garment Industry Chamber has estimated that 58 percent of clothing bought 

in Mexico enters the country illegally.675 Intellectual Property Rights (IPR) crimes, such as 

music piracy, are also widespread. According to the London-based International Federation of 

the Phonographic Industry (IFPI), Mexico is among the top ten music piracy centers in the 

world. According to the IFPI, in 2002 some 91 million illegally reproduced recordings were sold 

at Mexico’s street markets, street booths, public markets, and mobile vendors.676 In 2002 a 

“Korean mafia” was identified in Mexico City as one of largest distributors of counterfeit 

products and pirated intellectual property from Asia.677

Terrorist Activity 

During the 1970s, Mexico’s generous asylum policies toward refugees from right-wing 

dictatorships in Spain and Latin America made it a hospitable environment for foreign militants 

and terrorists. One of the legacies of Mexico’s 1970s-era policies has been a continuing presence 

of “political delegations” belonging to guerrilla and terrorist groups. These delegations have 

found Mexico City to be a convenient base for fundraising activities and a safe haven from 

which to conduct propaganda and media events. As a result of past policies, at least two foreign 

terrorist groups, the Basque Homeland and Liberty (Euskadi Ta Askatasuna, ETA) and the 

Revolutionary Armed Forces of Colombia (FARC), maintain a presence in Mexico despite the 

fact that they are officially banned. Both groups rely heavily on local support networks within 

Mexico’s radicalized university faculties and expatriate communities. Despite their continuing 

commitment to violence, neither the FARC nor ETA has so far posed a direct threat to the United 

States from their bases in Mexico. 

 

675 Elisabeth Malkin, “Mexico Making Headway on Smuggling,” New York Times, 5 June 2003. 676 International Federation of the Phonographic Industry, Commercial Piracy Report 2003. 

<http://www.ifpi.org/site-content/about/mission.html> 

677 Luis Alegre, “Cae red de piratería; retienen a 43 coreanos” [Counterfeiting Network Dismantled; 43 Koreans 

Detained], Reforma [Mexico City], 6 December 2002, 22. 
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A more immediate threat is posed by the potential transit through Mexico of U.S.-

bound terrorists, and by the potential for attacks within Mexico itself. Because of its close 

proximity to the United States, its porous borders, its strategically significant oil industry, and a 

large U.S. commercial and tourism presence, Mexico may serve as a transit or target 

environment for a foreign terrorist operation. 

Experts believe that improved security procedures will cause future terrorists to resort 

to covert infiltration if they wish to enter the United States from Mexico. In a March 2002 report, 

the Foreign Military Studies Office (FMSO) addressed the potential of a smuggler-assisted 

terrorist infiltration through Mexico. The FMSO determined that “at this time, no apparent link 

exists between the international smugglers and any terrorist organization. However, that does not 

preclude a working relationship of some type from becoming a reality in the future.”678 In 

addition to smuggler-assisted infiltration, there is an ongoing threat of self-smuggling by 

terrorists. A U.S. Border Patrol report documented two self-smuggling attempts from Mexico 

into Texas by individuals affiliated with a Middle Eastern terrorist organization since April 

2001.679

In addition to the threat of terrorist transit through Mexico, there is also a potential that 

terrorist attackers could seek mass casualties or economic disruption within Mexico. Mexico 

possesses several strategic and industrial installations that could potentially attract a terrorist 

strike.680 In a March 2003 study, the FMSO listed a number of key installations connected to 

Mexico’s petroleum industry that could potentially be attacked, including offshore oil fields in 

the Bay of Campeche. Another potentially attractive target is the nuclear power plant at Laguna 

Verde, an attack upon which potentially would cause substantial casualties and economic 

damage in Mexico and create radioactive fallout over a substantial area of the southern United 

States.681

 

678 Thomas S. Davidson II, Human Smuggling along the U.S.-Mexican Border,” Foreign Military Studies Office, Ft. 

Campbell, Kentucky, March 2002. http://www.fmso.osis.gov 679 John Hall, Veracruz Terrorist Threat, U.S. Border Patrol, Del Rio Sector, undated report accessed through Open 

Source Information System, www.fmso.osis.gov. 680 Foreign Islamic terrorist organizations appear to be probing Mexico’s anti-terrorism capabilities. Two separate 

groups of Middle Eastern nationals were intercepted near Eagle Pass, Texas in April 2001 and May 2002. 

Photographs confiscated from both sets of aliens featured similar panoramic shots of the harbor of Veracruz as well 

as photos of Mexican naval vessels. The U.S. Border Patrol strongly suspects that the confiscated photos were taken 

for surveillance purposes; Hall. 

681 John Cabell, Bay of Campeche Oil Fields Protection Plan and Actions (Fort Leavenworth, Kansas, Foreign 

Military Studies Office, Ft. Leavenworth, Kansas, 31 March 2003) http://www.fmso.osis.gov
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Conclusion 

Mexico presents opportunities for transnational criminal activity because its long border 

with the United States has been porous, especially as international traffic has increased 

dramatically since the mid-1990s. As Mexico evolves toward a free-market society with a 

growing class of consumers, traffickers profit from a growing demand in consumer goods and 

narcotics. Increased financial exchanges with the United States, combined with a fast-growing 

sector of independent financial organizations with international banking capabilities, increase the 

likelihood of narcotics money being laundered in Mexico. In recent years, Mexico’s atmosphere 

of political corruption has been diminished by substantial reforms. The main question is whether 

those reforms can keep pace with the internationalism and economic growth that have become 

typical of Mexico since the mid-1990s. 

The Triborder Region 

Introduction 

The Tri-Border Area (TBA) of Argentina, Brazil, and Paraguay provides a haven that is 

geographically, socially, economically, and politically highly conducive for allowing the 

activities of organized crime, Islamic terrorist groups, and corrupt officials. Those groups are 

supported by drug and arms trafficking, money laundering, and other lucrative criminal 

activities. As of 2001, money laundering in the TBA reportedly was averaging US$12 billion a 

year, most of which is through the TBA cities of Ciudad del Este and Foz do Iguaçu. Ciudad del 

Este has been a vibrant commercial city featuring both legitimate and illegal transactions. In 

2000 the city generated US$12 to US$13 billion in merchandise sales, placing it third in this 

category among world cities. However, that figure may have fallen since then as a result of 

stricter Argentine and Brazilian customs procedures. Although the TBA is an active corridor for 

arms and drug smuggling into Argentina and Brazil, in recent years most drugs reportedly have 

been moving from Paraguay into these two countries via other Paraguayan drug centers. 

The TBA is home to both indigenous crime groups, most notably Brazilian and 

Paraguayan mafias, and non-indigenous syndicates from Chile, Colombia, Corsica, Ghana, Italy, 

Ivory Coast, Japan, Korea, Lebanon, Nigeria, Russia, and Taiwan. The thriving business of 
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importing counterfeit CDs and CD-ROMs into the TBA from Asia is linked to organized crime 

in Korea, Lebanon, Libya, and Taiwan. The Hong Kong mafia is particularly active in largescale trafficking in pirated products from mainland China to Ciudad del Este, and Hong Kong 

crime groups maintain strong ties with Hizballah in the TBA. 

Islamic terrorist groups, including al Qaeda, Hizballah, Islamic Jihad, and alMuqawamah, have used the TBA for fund-raising, drug trafficking, money laundering, plotting, 

and other such activities. Lax immigration controls and official corruption in the TBA have 

eased the purchase of false identity documents, including passports and visas, for Islamic 

extremists entering Paraguay. 

Efforts of the Argentine, Brazilian, and Paraguayan police forces to fight organized crime 

and terrorist activities in the TBA are hindered significantly by endemic corruption within the 

police, the criminal justice system, and the government; by poor pay and inadequate training, 

equipment, and funding for law enforcement personnel; by human rights abuses; by weak antimoney-laundering laws and enforcement; and, in Argentina and Brazil, by secrecy provisions of 

banking laws that encourage money laundering. 

Factors in Organized Crime and Terrorism 

Geographical Factors

The TBA’s porous borders are defined by three closely grouped population centers, one 

in each of the three countries: the Argentine city of Puerto Iguazú, the Brazilian city of Foz do 

Iguaçu, and the Paraguayan city of Ciudad del Este (formerly Puerto Presidente Stroessner). 

In the early 1970s, government planners sought to profit from the tourist attraction of 

nearby Iguazu Falls by establishing a free-trade zone in the rapidly growing boomtown city of 

Ciudad del Este, thereby allowing Argentines and Brazilians to purchase cheap electronic 

products there.682 The TBA soon gained a reputation as a lawless jungle corner of three 

countries―Argentina, Brazil, and Paraguay―dominated by the illegal activities of mafias and 

Islamic terrorist groups. However, in the past two decades the region also has progressed rapidly 

as a center of legitimate economic activity. The large majority of the diverse population is 

reported to be peaceful and law-abiding. 

 

682 Sebastian Junger, “Terrorism's New Geography,” Vanity Fair, no. 508 (December 2002): 196. 
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Societal Factors

As a result of the construction of the Itaipú Hydroelectric Dam, the population of the 

TBA increased from about 60,000 in 1971 to more than 700,000 in 2001.683 The TBA has a 

highly heterogeneous population. In 2001, Brazil’s Federal Police (Polícia Federal―PF) 

estimated that Foz do Iguaçu’s population consists of 65 different nationalities.684 In 1994 

Ciudad del Este’s ethnic population reportedly included 7,000 Lebanese, 6,500 Chinese, and 

4,000 Koreans.685 By 2001, however, the city’s largest ethnic group was the Chinese, with an 

estimated 30,000 members.686

The TBA has one of the most important Arab communities in South America. Figures on 

the size of the Arab population in the region vary widely. A 2001 Jane’s article notes that the 

region’s population includes 23,000 Arabs of Palestinian and Lebanese descent.687 Many 

thousands of Lebanese arrived during the civil war in Lebanon in the 1970s. Of the Arab 

population in Ciudad del Este and Foz do Iguaçu, an estimated 90 percent is of Lebanese origin, 

many with relatives in Lebanon’s Al Beqa’a Valley.688

The social structure of communities in Ciudad del Este and Foz do Iguaçu make these 

two cities ideal for the operation of Arabic-speaking terrorist or criminal groups. Extremists find 

the opportunity to assemble, form a cell with no risk of leaks, carry out their missions, and return 

with alibis backed up by many in the community. Estimates of Foz do Iguaçu’s Arab population 

are not considered to be reliable; estimates range from 10,000 to 21,000 Arabs, most of whom 

are of Palestinian and Lebanese descent. Foz do Iguaçu’s Islamic Cultural Center spokesman 

Mohamed Ismail has noted that only 1 percent of Arab nationals residing in the TBA do not 

profess the Islamic religion.689 The Arab community in the TBA is tightly knit, with its own 

schools and clubs, making outside penetration very difficult. The size and influence of this Arab 

 

683 Mariano César Bartolomé, Amenzas a la seguridad de los estados: La triple frontera coma ‘área gris’ en el cono 

sur americano [Threats to the Security of States: The Triborder Region as a ‘Grey Area’ in the Cone of South 

America], 29 November 2001. http://www.geocities.com/mcbartolome/triplefrontera1.htm] 684 Bartolomé, 3. 685 Ricardo Grinbaum, “In Paraguay, Smugglers' Paradise,” World Press Review, 43, no.1 (January 1996): 25-6. 686 Bartolomé, 7. 687 John Daly, “The Suspects: The Latin American Connection,” Jane’s Terrorism and Security Monitor, 1 October 

2001. 

688 Bartolomé, 4. 689 “Muslims Prevail Among Small Religions in Foz,” A Gazeta do Iguaçu [Foz do Iguaçu], 3 February 2003 (FBIS 

Document LAP20030211000124). 
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community may help to explain why the Lebanese government decided in January 1999 to close 

its embassy in Asunción, Paraguay, and to open a consulate in Ciudad del Este to watch over the 

interests of the Arab citizens in the TBA.690

Economic Factors

Ciudad del Este is an oasis for informants and spies; peddlers of contraband (largely 

cheap East Asian goods) and counterfeit products; traffickers in drugs, weapons, and humans 

(prostitutes, including women and children forced into prostitution); common criminals; mafias; 

undocumented Arabs; and terrorists. Although Ciudad del Este is filled with street merchants 

selling cheap trinkets and counterfeit products, one can also purchase items such as an AK-47 for 

US$375.691

Despite its seedy appearance, Ciudad del Este is a world-class center of commerce, 

attracting many tourists and prosperous banks.692 Thanks to the presence of organized crime, 

Ciudad del Este’s retail economy ranked third worldwide behind Hong Kong and Miami among 

cities in volume of cash transactions.693 In 2001 the estimated annual turnover in Ciudad del Este 

made the city’s economy larger than that of the rest of Paraguay.694

The relatively small Arab community in Ciudad del Este is among Latin America’s most 

prosperous and influential. According to some estimates, between 15,000 and 21,000 Arabs of 

Palestinian and Lebanese descent live and work across the Brazilian border in Foz do Iguaçu and 

its surrounding hinterlands, while maintaining commercial outlets in Ciudad del Este. 

The region’s main economic dynamic is business between Ciudad del Este and Foz do 

Iguaçu. As a result of traditional price differences between Paraguay and Brazil, the Friendship 

Bridge is crossed daily by large numbers of small-scale entrepreneurs carrying products for sale. 

Border monitoring of this traffic, which includes many individuals lacking documents, generally 

has been limited to simple spot-checks.695

 

690 “Arabic Factions ‘Bidding’ for New Lebanese Consulate,” ABC Color [Asunción], 31 January 1999, 61 (FBIS 

Document FTS199902001001342). 

691 Jeffrey Goldberg, “In the Party of God,” The New Yorker, 79, no. 32 (28 October 2002). 692 Ricardo Grinbaum, “In Paraguay, Smugglers' Paradise,” World Press Review, 43, No.1 (January 1996): 25-6. 693Sebastian Rotella, “Jungle Hub for World's Outlaws,” Los Angeles Times, 24 August 1998, 1. 694 Larry Rohter, “Terrorists Are Sought in Latin Smugglers' Haven,” New York Times, 27 September 2001, A3. 695 “Surveillance System on Friendship Bridge,” A Gazeta do Iguaçu [Foz do Iguaçu], 6 November 2002 (FBIS 

Document LAP20021121000006). 
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The traditional status of the TBA as a source of cheap goods has been severely restricted 

by new regulations issued by Argentina and Brazil. After the implementation of an integrated 

customs system by the Brazilian Secretariat of Federal Revenue (Secretaria da Receita Federal—

SRF) to combat smuggling, commerce between Ciudad del Este and Foz do Iguaçu reportedly 

decreased by 90 percent, according to information disclosed at a meeting of City Council 

members of both cities.696 In an attempt to curb the loss of tax revenues, Argentina’s and Brazil’s 

revenue authorities imposed monthly limits on purchases in the region.697 As a result of these and 

other measures such as increased security, commercial activity in Ciudad del Este has slowed 

considerably. Whereas in 1995 the city had 7,000 businesses, the figure in 2000 was only 2,000. 

During the same period, bank branches in the city were reduced from 21 to 14.698

Of the three TBA cities, Argentina’s Puerto Iguazú has the least economic activity. The 

local Chamber of Commerce has reported that 600 of the 1,450 local businesses registered in 

Puerto Iguazú have closed in recent years.699

Immigration Control

The TBA is known for lax immigration controls. According to police in Brazil and 

Paraguay, false passports, birth certificates, driver’s licenses, and other documents are easily 

obtained through corrupt officials. In 2000 Paraguay’s Vice Interior Minister Mario Agustin 

Sapriza stated that the Immigrations Department of Paraguay had not effectively prevented the 

TBA from being used by Islamic extremists. He acknowledged that the service must improve to 

exert greater control, particularly regarding the activities of Islamic terrorism, but said that 

foreign citizens cannot be stopped from entering the country.700

The market for false documentation is especially strong among Arab, Asian, and other 

migrants who come to live in Paraguay for months or years, then upgrade their documents in 

 

696 “Commerce between Ciudad del Este and Foz do Iguaçu Drops by 90 Percent,” Vanguardia [Asunción], 3 

December 2002 (FBIS Document LAP20021203000105). 697 Bartolomé, 2. 698 Bartolomé, 2. 699 Bartolomé, 4. 700 Mario Daniel Montoya, “War on Terrorism Reaches Paraguay’s Triple Border,” Jane’s Intelligence Review, 13, 

no. 12 (December 2001): 13; and “Policiais viajam em vôos internos argentinos” [Police Fly on Internal Argentine 

Flights], 19 September 2001. [http://www.estadao.com.br/agestado/noticias/2001/set/19/207.htm]. 
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order to move on to Argentina, Brazil, or North America.701 Since 2000, about 30 percent of the 

false immigration documents seized at Argentina’s Puerto Iguazú checkpoint were carried by 

Chinese who were presumed to be heading to Buenos Aires.702

In early October 2001, high-level sources in Argentina’s Ministry of Interior called 

Brazil's immigration control system for the TBA a problem.703 Argentina places its emphasis on 

immigration control at the border crossings, whereas Brazil's control operations are located 

somewhat deeper inside its territory. Brazilian authorities have established controls on the roads 

several kilometers from Foz do Iguaçu. 

Government Corruption

Argentine police official Hugo Antolin Almiron has commented that corruption in 

Argentina “has penetrated deep within the public offices and has affected every stratum of the 

society and has further generated various types of misconduct.”704 After the reelection of Carlos 

Menem as president of Argentina in May 1995, the public increasingly perceived office-holders 

as highly corrupt. This perception was exacerbated by the government’s failure to adopt any of 

the 40 legislative proposals aimed at goals such as reforming the judiciary and eliminating 

corruption. The extent of Menem’s own corruption was revealed in July 2002 when a witness 

implicated Menem in covering up the 1994 bombing of the Argentine-Israeli Mutual Association 

(Asociación Mutual Israeli-Argentina—AMIA), a Jewish community center in Buenos Aires.705

As president, Menem, whose parents migrated from Syria, appointed a Syrian army colonel to be 

customs overseer at Buenos Aires' Ezeiza International Airport, which has been described as “a 

major hub for smuggling in South America.”706 In August 2003, an Argentine court cleared 

 

701 William W. Mendel, “Paraguay's Ciudad del Este and the New Centers of Gravity,” Military Review, 82, no. 2 

(March-April 2002). 

702 Mendel. 703 “National Border Guard Commander: Tri-Border Area Hotbed of Sleeper Cells,” La Nación [Buenos Aires], 3 

October 2001 (FBIS Document LAP20011003000015). 

704 Hugo Antolin Almiron, “Organized Crime: A Perspective from Argentina.” Chapter 14 in Jay S. Albanese, Dilip 

K. Das, and Arvind Verma, eds., Organized Crime: World Perspectives. (Upper Saddle River, New Jersey: Prentice 

Hall, 2003), 320. 

705 Larry Rohter, “Iran Blew Up Jewish Center In Argentina, Defector Says,” New York Times, 22 July 2002, A1; 

“Slow-Motion Justice in Argentina,” New York Times, 11 March 2003, A24; and Larry Rohter, “World Briefing 

Americas: Menem Acknowledges Swiss Account,” New York Times, 25 July 2002, A9. 706 Martin Edwin Andersen, “Al-Qaeda Across the Americas,” Insight on the News, 17, no. 44 (26 November 2001): 

20-21. 
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Menem, who again had been a leading candidate for the presidency in the elections of 2003, of 

charges of involvement in trafficking arms to Ecuador and Croatia between 1991 and 1995. 

In December 2000, a parliamentary report by the Drug Traffic Investigating Commission 

of Brazil’s Congress accused a large number of Brazilian officials, including federal deputies 

(congressmen), former state governors, state deputies, mayors, judges, police officers, and 

lawyers, of complicity in organized crimes ranging from drug trafficking to arms trafficking to 

tax evasion.707 The report concluded that drug-related corruption is so widespread that it is 

impossible to clean up in the short term without calling in the military and restructuring and 

rearming the country's police. A 2002 congressional report on Brazil’s nationwide surge in 

highway robberies of truck cargo called for the indictment of 100 politicians, police, and 

entrepreneurs allegedly involved in the theft of cargo.708

Governmental, political, and diplomatic corruption in Paraguay and the TBA allows 

individuals associated with organized crime and terrorism to bribe judges, purchase entry visas, 

and engage in any number of other criminal activities that might overlap with legitimate 

economic activities. An investigation conducted by Paraguay’s National Directorate of Civil 

Aeronautics (Dirección Nacional de Aeronáutica Civil—Dinac) found that an average of 570 

foreigners annually enter the country through the Ciudad del Este Airport using irregular 

documents, after paying bribes averaging US$5,000.709

In early November 2001, Paraguayan judge Carlos Cálcena charged that some of 

Paraguay’s consulates had been converted into veritable offices for falsifying documents. During 

the first 10 months of 2001, the Directorate of Legal Affairs in Paraguay’s Ministry of Foreign 

Affairs opened 10 cases concerning illicit visas.710

Recent investigations carried out in the TBA have found that numerous Lebanese citizens 

residing in Ciudad del Este had entered Paraguay with illicit visas. The most well known case 

was that of Ahmad Assad Barakat, a leading Hizballah figure in the TBA, who was able to enter 

Paraguay in 1989 using a visa obtained from the Paraguayan Consulate in Panama although that 

 

707 Andrew Downie, “Corruption's Roots Deep and Wide-Reaching in Brazil,” Christian Science Monitor, 14 

December 2000; “Investigation Shows Pervasive Impact of Drug Trade in Brazil,” America's Insider, 1, no. 9 (8 

December 2000): 6. 

708 Raymond Colitt, “Brazil Tracks Down the Real Culprits Behind Surge in Highway Robberies,” Financial Times

[London], 2 May 2002,10. 

709 Bartolomé, 18. 710 Bartolomé, 18. 
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office not authorized to issue visas.711 The Paraguayan consul in Miami, Carlos Weiss, had 

allegedly sold more than 300 passports, visas, and shipping documents to individuals heading to 

the TBA between 1999 and 2001. Weiss’s customers for documents included three Lebanese 

who were on the FBI terrorist watch.712

Police Corruption

The effectiveness of a country’s security forces in combating organized crime and 

terrorism is clearly a factor in determining whether conditions are conducive to allowing these 

illicit activities to flourish. The efforts of the security forces of Argentina, Brazil, and Paraguay 

have been ineffective in this regard because they have been of hindered by corruption, human 

rights abuses, and inadequate funding and training. 

The Argentine police have at least three reasons to lack motivation to fight crime. First, 

their primary duty is to maintain social order, not to investigate serious crime. Second, many 

police officers are frustrated by the slow-moving legal system and by expanding missions, 

especially in the area of counter-narcotics. Some police officers take the law into their own hands 

when they believe that the judicial system’s sentences against offenders are too light. Police 

violence, including beatings, shootings, and rapes, has reportedly greatly increased since the 

mid-1990s.713

The third factor is poor pay, which starts at about US$400 per month. For these reasons, 

corruption is a serious problem at all levels of the Argentine police.714 Corruption among police 

and prison officials receives little attention because whistle-blowing colleagues, judicial officials, 

and civilian witnesses are intimidated by the prospect of being subjected to retaliation. Threats 

and beatings aimed at potential witnesses are common. High-level officials have also sought to 

discredit damaging testimony of subordinates by initiating internal proceedings against 

whistleblowers. 

 

711 Bartolomé, 17. 712 Mendel; Larry Rohter, “Terrorists Are Sought in Latin Smugglers’ Haven,” New York Times, 27 September 2001. 

<www.nytimes.com>; and Bartolomé, 17. 713 “Delinquent: Tackling Crime Needs Police Reform,” The Economist [London], 5 October 2002. 714 U.S. Department of State, Country Reports on Human Rights Practices 2001. 

<http://www.state.gov/g/drl/rls/hrrpt/2001/wha/8278.htm> 
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For the past 20 years, the Argentine police reportedly have been involved in organized 

crime. According to María del Carmen Verdú of the Center for the Prevention of Police 

Repression, “In the last decade, there has not been any major illegal business without police 

participation, from prostitution to gambling, robbery, or kidnapping.”715 Accusations range from 

collecting fraudulent payments for services not provided, to theft of vehicles, murder, and 

rape.716

The effectiveness of Brazil’s police forces in fighting organized crime and terrorist 

groups in the TBA is hindered by a general lack of respect for human rights, widespread 

corruption, and involvement in crime, as well as a general failure of the Brazilian government to 

address their serious problems. Brazil’s state police forces have committed numerous serious 

human rights abuses. State police forces have committed many extra-judicial killings, tortured 

and beat suspects under interrogation, and arbitrarily arrested and detained persons. Elements 

within the military police of some states have been notorious for their vigilantism and deathsquad activities. Federal prosecutors have reported that corruption among state police often 

impedes the apprehension of traffickers. Police also have been implicated in criminal activity of 

all kinds, including killings for hire, death squad executions, extortion, kidnappings for ransom, 

and narcotics trafficking.717

Brazil’s politicians have repeatedly demonstrated a lack of the will needed to implement 

needed reforms of the police forces, the penal code and criminal justice system, and prisons, and 

to adopt a gun-control bill.718 The authorities' failure to investigate, prosecute, and punish police 

who commit such acts has created a climate of impunity that continues to encourage human 

rights abuses. 

According to the U.S. Department of State, the Paraguayan police has continuing 

problems with incidents of extra-judicial killings, torture and abuse of convicted prisoners and 

other detainees, arbitrary arrests and detention, use of force against nonviolent demonstrators, 

lengthy pretrial detention, corruption and inefficiency in the judiciary, and infringements on 

 

715 “Delinquent: Tackling Crime Needs Police Reform.” 716 “Delinquent: Tackling Crime Needs Police Reform.” 717 Pedro Oviedo, “En la Triple Frontera se lavan doce mil millones de dólares al año del narcotráfico, según un 

informe official” [In the Triborder Area US$12 billion Is Laundered Per Year From Narcotics Trafficking, 

According to an Official Report] http://misionesonline.net/paginas/action.lasso?-database=noticias3&-

layout=web&-response=noticia.html&id=11349&autorizado=si&-search. 718 Oviedo. 
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citizens' privacy rights.719 By October 2001, as authorities in Paraguay increased surveillance of 

the country's Arab immigrants, there were charges that police were extorting large sums of 

money from some merchants in return for not detaining them.720

Ciudad del Este’s 200-member police force is suspected of corruption.721 A general lack 

of confidence in the police may be reflected by the fact that the city’s 6,000 shops, 36 banks, and 

15 money exchanges all have their private guards. 

Organized Crime 

Indigenous Groups

Hugo Antolin Almiron has commented that “organized crime in Argentina has a peculiar 

local character that thrives on the socioeconomic and political conditions prevalent in the 

country.” He adds, however, that international narcotics cartels active in Argentina also are 

active in trafficking of children, smuggling, marketing of stolen cars, tax evasion, embezzlement, 

fraud, insider trading, and financial swindles. In his assessment, “organized crime in Argentina 

exists in an incipient developmental stage, but at the same time it is becoming a major 

concern.”722 The TBA is of particular concern to the Argentine government in this regard 

because it serves as a gateway for organized crime to migrate south into the rest of the country. 

Until 2001, most of Brazil’s arms-for-cocaine trafficking revolved around the country’s 

most notorious cocaine lord, Luiz Fernando Da Costa. Brazil’s Parliamentary Commission 

identified international connections of Da Costa in Paraguay, Peru, and Colombia. Da Costa is 

known to have purchased arsenals in Paraguay and brought them to a base of operations in 

Paraguay’s Guairá Department. He operated from Paraguay until forced to move to Colombia.723

According to official reports, prior to his capture in 2001 Da Costa sold arms to FARC rebels in 

exchange for cocaine. 

Organized crime in Brazil appeared to be becoming increasingly violent in 2002 and 

early 2003. In October 2002, police foiled an attempt by organized criminals to blow up the São 

 

719 U.S. Department of State, Country Reports on Human Rights Practices 2001. 

<http://www.state.gov/g/drl/rls/hrrpt/2001/wha/8297.htm> 720 Bill Rogers, “Arabs Accuse Paraguay Police Of Extortion,” Middle East News Online, 4 October 2001. 721 Grinbaum, 25-6. 722 Almiron, 329. 723 “El prontuario de Fernandinho” [Fernandiño’s Handbook] El Tiempo [Bogotá], 21 April, 2001; “Muestran a 

Fernandiño a la prensa” [Fernandiño Is Shown to the Press], El Tiempo [Bogotá], 22 April 2001. 
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Paulo Stock Exchange with a car packed with explosives.724 In February 2003, drug gangs 

paralyzed commerce and traffic in parts of the city of Rio de Janeiro and battled police in the 

streets. In March, organized crime groups assassinated two judges.725 A powerful São Paulo 

prison gang has been linked to Da Costa and the Italian Mafia.726 In February 2003, assassins 

believed to be members of a criminal organization in Foz do Iguaçu seriously wounded the 

president of the Foz do Iguaçu City Council.727

Paraguay’s Ciudad del Este, together with its Brazilian twin city of Foz do Iguaçu, is the 

epicenter of organized crime in the TBA. In that city, organized crime, corrupt officials, and 

members of radical Islamic groups have been able to engage freely in money laundering, 

intellectual property piracy, alien smuggling, and arms and drug trafficking, among other illicit 

activities. A large percentage of criminal transactions involve bartering drugs for weapons with 

Colombian armed rebel groups.728

One criminal organization operating in the Ciudad del Este area is headed by the feared 

Elvio Ramón Cantero Aguero, based in Pedro Juan Caballero, located on the Brazilian border 

northwest of the TBA.729 In 2002, a police raid of hideouts in Ciudad del Este found a large stock 

of weapons. Cantero Aguero, however, remained at large. 

Former General Lino César Oviedo is reputed by Brazilian and U.S. officials to be head 

of the so-called Paraguayan Cartel. Included in his estimated worth of US$1 billion are 

numerous properties in the TBA.730 In the 1990s, authorities intercepted multi-ton cocaine 

shipments from Oviedo, originating in the TBA. At the time of his arrest in June 2000, Oviedo 

was using Foz do Iguaçu and Ciudad del Este as a base of operations for laundering money, with 

the help of a fellow Paraguayan general, José Tomas Centurión. 

 

724 Stan Lehman, “Brazilian Police Thwart Bomb Plot,” The Columbian, 22 October 2002, A5. 725 Peter Muello, “Brazilians Outraged by Slayings of Judges: Organized-Crime Groups Unleash Wave of 

Violence,” Houston Chronicle, 27 March 2003, 27. 726 Raymond Colitt, “Another Judge Killed as Drugs Crime Alarms Brazil,” Financial Times [London], 25 March 

2003, 11. 

727 “Foz City Council President Shot in Attack,” Itapiru Radio [Ciudad del Este], 24 February 2003 (FBIS Document 

LAP20030226000042). 

728 Riyadh Alam-al-Din, "Washington Begins the War on Hizballah in the Border Triangle," Al-Watan al-Arabi

[Paris], 21 December 2001, 18-19 (FBIS Document GMP20011221000179). 

729 Cesar Palacios and Oscar Florentín, “Paraguay: Police Confiscate Arsenal from Gangster's Home,” Noticias

[Asunción], 6 December 2002 (FBIS Document LAP20021206000030). 730 “El Caso Lino Oviedo y su conexión con la Argentina” [The Lino Oviedo Case and Its Connection with 

Argentina], Página1 2 [Buenos Aires]. <www.pagina12.com.ar/2001/suple/carrio/cap11.pdf> 
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Non-Indigenous Mafias

Crime syndicates from Brazil China, Colombia, Corsica, Ghana, Italy, Ivory Coast, 

Japan, Korea, Lebanon, Nigeria, Russia, and Taiwan are known to have operated in Paraguay 

and the TBA. According to United States law enforcement and intelligence sources, a number of 

these groups are associated with corrupt Paraguayan business executives, politicians, and 

military officers tied to the ruling Colorado Party.731 The Colombian, Italian, and Nigerian 

mafias have been identified as the main transnational mafias operating in Brazil, although those 

groups do not appear to have headquarters in that country.732

The influence of foreign groups in Brazil has been largely the result of the country's role 

as a transit country for illegal drug shipments. According to one report, since 1995 monetary 

reforms have made it more difficult for foreign criminals to find refuge in Brazil, and local 

groups of varying size now play the most important role in organized crime in Brazil. However, 

the known presence of foreign mafias from Lebanon, China, and Korea operating in São Paulo 

and other Brazilian cities casts doubt on this assertion.733

The cultural and social demographics of Ciudad del Este are ideal for the operations of 

Chinese-speaking criminal groups. In the 1990s, Chinese criminal groups such as Fuk Ching, Big 

Circle Boys, Flying Dragons, and Tai Chen, mostly from mainland China, established a presence 

in Ciudad del Este in order to profit from the city’s Asian imports.734 Authorities consider these 

groups to be especially dangerous because they do not limit their activities to predictable 

locations within the Chinese communities.735 Chinese criminal groups specialize in providing 

“protection” to the local Chinese business people, imposing “taxes” on the containers imported 

by the Chinese businesses, and forcing the Chinese business community to purchase 

merchandise imported by the groups.736

 

731 Jack Sweeney, “DEA Boosts Its Role in Paraguay,” Washington Times, 21 August 2001. 732 Ruy Gomes Silva, “Effective Measures to Combat Transnational Organized Crime in Criminal Justice 

Processes,” presentation to 116th International Training Course, Asia and Far East Institute for Prevention of Crime 

and Treatment of Offenders, Tokyo, November 2000. <http://www.unafei.or.jp/pdf/103.pdf> 733 Machado de Morais and Andrea Frota, Money Laundering in Brazil, report to School of Business and Public 

Management, Institute of Brazilian Business and Management Issues, George Washington University, Fall 2000. 

[http://216.239.51.100/search?q=cache:Ms30X17JQ_YC:www.gwu.edu/~ibi/minerva/Fall2000/Andrea.Morais.pdf+

cc-5+brasil+paraguay&hl=en&ie=UTF-8]. 

734 Sebastian Rotella, “Jungle Hub for World's Outlaws,” Los Angeles Times, August 24, 1998, 1. 735 Rotella. 736 Bartolomé, 7. 
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Paraguay’s ABC Color has reported that Hong Kong-based groups engage in large-scale 

trafficking in pirated products from mainland China to Ciudad del Este and maintain strong ties 

with the pro-Iranian Hizballah in the TBA.737 Chinese and Korean mafias with branches in São 

Paulo (Brazil), Santa Cruz de la Sierra (Bolivia), San Francisco (California), and Buenos Aires, 

among other cities, have been identified in the TBA.738

As of late 2002, investigators had determined that five Chinese mafias operate in São 

Paulo: Fu Shin and Fei Jeii from Canton and three others from Beijing, Shanghai, and Taiwan, 

respectively.739 The Chinese mafia in São Paulo earns an estimated US$1.6 million annually 

from extortion or “protection” money from ethnic Chinese businesses in exchange for the right to 

sell certain contraband merchandise.740 An estimated 70 percent of the 150,000 Chinese in São 

Paulo are being extorted.741 The Chinese mafias have expanded to a number of other Brazilian 

cities, including Foz do Iguaçu, and to Paraguay’s Ciudad del Este.742

In 2001 the Paraguayan government made a significant effort to neutralize the activities 

of the Chinese criminal groups, but with only occasional success. As a result of the Chinese 

groups’ ability to bribe Paraguayan judges, they have been able to operate with impunity, 

according Jorge Ho, the consul general of Taiwan in Ciudad del Este.743 Evidence shows that the 

TBA plays a key role in the expansion plans of these criminal organizations into the duty-free 

zone of Argentina’s San Luis Province. 

The Chinese mafia in the TBA is known to collaborate with Islamic terrorist groups in 

the region. Brazilian investigative reporter Roberto Godoy has reported that at least two 

organizations with bases in the TBA—the Sung-I and Ming families—have engaged in illegal 

operations with the Egyptian Gamaa Islamiya (Islamic Group).744 ABC Color reported that 

 

737 “Paraguay: 'Strong Ties' Seen Between Hong Kong Mafia, Tri-border Based Hizballah,” ABC Color [Asunción], 

22 November 2002 (FBIS Document LAP20021122000059). 

738 Bartolomé, 5. 739 Aloisio Milani, “Máfia chinesa extorque e executa em São Paulo” [Chinese Mafia Extorts and Executes in São 

Paulo], Jornal-laboratório da Faculdade de Comunicação Social Cásper Líbero [São Paulo], no. 28 (December 

2001). [http://biondi.fcl.com.br/facasper/jornalismo/esquinas/noticia.cfm?secao=4&codigo=87]. 740 Milani. 741 Milani. 742 Milani. 743 Bartolomé, 16. 744 Bartolomé, 8. 
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black-market activity such as the counterfeit manufacture of mass-distribution items such as 

toys—has a distribution chain running from Hong Kong to Hizballah extremists in the TBA.745

Criminal gangs in Paraguay have known ties to Colombia’s FARC. Paraguayan 

authorities arrested a Colombian citizen in Ciudad del Este in 2000 as he tried to arrange a 

cocaine-for-weapons swap on behalf of the FARC. Links between crime syndicates in Ciudad 

del Este and the FARC date from the mid-1990s at least. At that time, Paraguayan General 

Oviedo protected Brazilian drug trafficker Luiz Fernando Da Costa, who was captured in 

southern Colombia in April 2001 in the company of FARC rebels.746

Tightened security measures by the TBA nations have threatened the interests of criminal 

organizations with links to extremist groups, resulting in a growing trend of violent attacks 

against authorities. In 1997 Argentine reporter Hernán López Accago described businessmen in 

the region paying what amounted to protection money to armed Arab groups in the region.747

This money is used in financing military operations in various parts of the world. At least one 

Ciudad del Este businessman was murdered because he failed to pay the tax. The convicted 

murderer, Armando Kassen, who was president of the Paraguayan Arab Chamber of Commerce, 

fled to Beirut.748

In the late 1990s, members of the Russian mafia reportedly began exploring Paraguay, 

supplementing their presence in Colombia, Argentina, and Brazil.749 According to Paraguayan 

police intelligence, Russian mafia groups were seeking out contacts with the mafia of countries 

belonging to the Southern Cone Common Market (Mercosur), principally those operating from 

the drug-trafficking zones on the Brazil-Paraguay border northwest of the TBA. The intention of 

the Russians apparently has been to ally themselves with the capos of the South American mafias 

in order to facilitate the distribution of cocaine in Europe.

According to regional expert Bruce Michael Bagley, Chechen gangs have established a 

base in Argentina, primarily to use that country as a transit country for Andean cocaine 

shipments to Europe, arms trafficking to Brazil and Colombia, and money laundering. In the 

 

745 “Hong Kong Mafia Linked to Hizballah in Tri-Border Region,” ABC Color [Asunción], 22 November 2002 

(FBIS Document LAP20021122000047). 

746 Jack Sweeney, “DEA Boosts Its Role in Paraguay,” Washington Times, August 21, 2001. 747 “Brazil: Report on Islamic Terrorism in Iguazu Triangle,” al-Watan al-'Arabi [Paris], 9 January 1998, 22-24. 748 “Mastermind of Taiyen's Murder Residing in Beirut,” Vanguardia [Ciudad del Este], 11 November 2002 (FBIS 

Document LAP20021121000006). 

749 “Paraguay es uno de los países explorados por mafia rusa” [Paraguay Is One of the Countries Explored by the 

Russian Mafia], ABC Color [Asunción], 16 October 1997. 
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TBA, Argentine intelligence sources have detected contacts between Chechen separatist groups 

and Islamic terrorists, Chechen groups also may be using these networks for arms smuggling 

purposes.750

Since the mid-1990s, various sources have reported arms-for-cocaine trafficking between 

the Russian and Brazilian mafias. The Rio de Janeiro newspaper O Globo reported in mid-2000 

that various Russian mafia criminals have been detected in Brazil and linked to the growing 

participation of Russian mafia groups in the recruitment of Brazilian women for prostitution in 

Europe, especially Spain, and Israel, as well as to the appearance of AK-47 military assault rifles 

and other modern weapons in the shantytowns of Rio de Janeiro controlled by narcotics 

traffickers.751 Frequently used in attacks by Rio de Janeiro gangsters, AK-47 and AR-15 

semiautomatic rifles have demonstrated the expansion of the Russian mafia’s weapons supply 

operations to the Brazilian underworld. 

Narcotics and Arms Trafficking

According to the U.S. Department of State, Argentina is not a major drug producing 

country, but it serves as a transit country for cocaine flowing primarily from neighboring Bolivia, 

some heroin en route from Colombia to the U.S. East Coast, and possibly also some cocaine 

from Peru and Colombia. Brazil is a conduit for amphetamine precursor substances moving from 

source countries to Europe and the United States. Paraguay also serves as a transit country for 

Andean cocaine.752 The TBA is considered to be an important area for the smuggling of drugs 

into Argentina, Brazil, and Paraguay as well as arms to organized crime groups in Brazil. 

Trafficking operations thrive in the TBA in part because more than 100 hidden airstrips 

in the triangle provide a transport base. However, drug-related border arrests at Puerto Iguazú 

have declined since 2000 because most drugs are now moving from Paraguay into Argentina or 

Brazil from points south of the TBA, such as Encarnación. That city has a large Arab population 

and is known as a main contraband center.753 The town of Capitán Bado on the Brazilian border, 

 

750 Bagley. 751 “Mafia rusia en Latinoamérica” [Russian Mafia in Latin America], La Nación Digital [Buenos Aires], 25 

September 2000. 

752 U.S. Department of State, International Narcotics Control Strategy Report 2002. 

[http://www.state.gov/g/inl/rls/nrcrpt/2002/html/17952pf.htm]. 

753 Mendel. 
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south of Pedro Juan Caballero, is a center for marijuana production and cocaine distribution. The 

marijuana is transported to Brazil by land; most of the cocaine is flown in clandestine flights 

aboard small aircraft.754

Money Laundering

As of 2000, an estimated US$12 billion was being laundered in the TBA every year.755

According to official Brazilian data, money launderers used the banks and exchange houses of 

Foz do Iguaçu and Ciudad del Este to launder US$6 billion of the estimated US$11 billion of 

fraudulent financial transactions and tax evasion profits generated in the 1999-2001 period.756

Argentina’s Central Bank estimates that more than US$6 billion is laundered the 

country’s banking system annually.757 Laundering related to narcotics trafficking, corruption, 

contraband, and tax evasion is believed to occur throughout the financial system.758 Although the 

country’s financial crisis recently has limited money laundering through the banking system, the 

activity continues through other financial mechanisms. Money laundering does not occur in the 

Argentine sector of the TBA, however, on nearly as large a scale as in the Brazilian and 

Paraguayan sectors of the region.759

The December 2000 report released by the Brazilian Congress’s Drug Traffic 

Investigating Commission states that US$50 billion in tainted money is laundered through 

Brazil's banks each year.760 According to the Central Bank of Brazil, 17 percent of the money of 

the Colombian drug cartels is laundered through that system. Although the city of Campinas is 

considered the major money-laundering center in the country, substantial activity also has been 

identified in the TBA. Local Prosecutor Paulo Gomes Junior estimated in 1999 that 40 percent of 

the local companies in Foz do Iguaçu are fronts created by local mafia to launder money and to 

 

754 Clarinha Glock, “Brazil-Paraguay: A Full Plate for Journalists.” 

<http://www.impunidad.com/atrisk/brasil_paraguay7_19_01E.html]. 755 Oviedo. 756 Bartolomé, 9. 757 Oviedo. 758 U.S. Department of State, International Narcotics Control Strategy Report 2002. 759 Mario Osava, “Ciudades de América Latina/Brasil: Lavado y fuga de capitales en la frontera con Paraguay” 

[Cities of Latin America/Brazil: Laundering and Flight of Capital on the Border with Paraguay], Inter-Press Service 

report, 1999. <http://ips.org/Spanish/mundial/indices/Correo/cor0606051.htm> 760 Downie; “Investigation Shows Pervasive Impact of Drug Trade in Brazil,” America's Insider, 1, no. 9, (8 

December, 2000): 6. 
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send it abroad.761 Foz do Iguaçu currently has 13 exchange houses remaining after 20 were 

closed in early 2000 for engaging in laundering activities. 762

In the assessment of the U.S. Department of State, Paraguay is a principal moneylaundering center.763 A December 2000 Argentine report on money laundering in Foz do Iguaçu, 

Ciudad del Este, and Puerto Iguazú estimated that almost all of Paraguay’s money laundering, 

estimated to total at least US$5 billion annually, is done in Ciudad del Este.764 All three of the 

TBA countries have experienced difficulties in countering money laundering. In the cases of 

Brazil and Paraguay in particular, such failures have had a significant effect on money 

laundering, and hence on the forms of crime and terrorism that money laundering supports in the 

TBA. 

Argentina’s 2000 anti-money-laundering law theoretically strengthened mechanisms for 

identifying and prosecuting money launderers.765 However, the Financial Intelligence Unit 

(Unidad de Información Financiera—UIF) created by that law only went into full operation in 

February 2003, after initially operating with low funding. That unit is responsible for prevention 

and control of laundering activities related to narcotics and arms trafficking, political and racial 

crimes, federal fraud, and sex crimes.766 Despite these measures, the Central Bank reportedly has 

been totally ineffective in prosecuting money laundering, and the Management of Control and 

Injunction (La Gerencia de Control y Requerimiento) has failed to take to trial a single case that 

he has investigated.767

In Brazil, the lack of transparency in national banking laws presents a significant obstacle 

to the prevention of money laundering.768 According to the U.S. Department of State, Brazil has 

only limited capacity to engage in the sophisticated law enforcement techniques required for 

investigating complex crimes such as money laundering, and the results of such techniques are 

 

761 Osava. 762 Oviedo. 763 U.S. Department of State, International Narcotics Control Strategy Report 2002.. 764 Oviedo. 765 U.S. Department of State, International Narcotics Control Strategy Report 2002. 766 Argentina, “Ley 25246: Creación de la Unidad de Información Financiera” [Law 25246, Creation of the 

Financial Information Unit], Boletín Oficial [Buenos Aires], 10 May 2000. <http://www.imolin.org/argtlaw2.htm> 767 Oviedo. 768 de Morais and Frota, 38. 
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not admissible in Brazilian courts. As a result, Brazil has had only one money-laundering 

conviction since 1998, despite its status as a regional financial center.769

Other Organized Crime Activities

Smuggling stolen luxury cars is a profitable business in the TBA. Cars are stolen in 

Brazil and Argentina and taken to Paraguay via the TBA, then to Bolivia and beyond. The stolen 

car business is facilitated by lax border controls and by Paraguayan legislation that requires no 

documentary backing to legalize private contracts. According to Paraguayan authorities, more 

than half of the 450,000 vehicles registered annually in Paraguay were acquired illegally. In 

Brazil, automobile theft is under the jurisdiction of the State Police, which apparently is not very 

effective in countering it.770

The TBA’s two principal transit centers for stolen vehicles and smuggled goods are Foz 

Do Iguaçu and Ciudad del Este. Those cities also form a corridor for trafficking in drugs and 

arms. Some of the illicit cargo passes along an illegally opened road crossing the Iguazú National 

Park.771 The Asunción-Paranaguá Highway, which passes near the falls, is also presumably used 

by smugglers. 

Street vendors, selling fake products and pirated copies of goods ranging from designerlabel sneakers to auto parts, have long been a part of life in Brazil. More than half of the business 

software and music compact disk (CD) market in Brazil is pirated, and as much as 40 percent of 

the cigarettes consumed in Brazil come from the black market. Industry experts also estimate 

that one-fifth of the drugs on pharmacy shelves are produced illegally.772

According to Carlos Alberto de Camargo, director of the anti-piracy program of the 

Brazilian Motion Picture Association, “Brazil has good laws on piracy; the problem is 

enforcement.”773 Officials in the motion picture industry say that a series of national raids by 

police have apprehended many small pirate operations without affecting overall trade.774

 

769 U.S. Department of State, International Narcotics Control Strategy Report 2002. 770 Silva. 771 Glock. 772 Patrice M. Jones, “Pirated Goods Cripple Brazil's Economy, but Solutions Seen as Weak,” Chicago Tribune, 4 

November 2002, 1. 

773 Jones. 774 Jones. 
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Brazilian officials have reported that the power behind the black market is organized 

crime and international terrorism. The Arab community in the TBA has been tied to the black 

market trade in pirated goods, particularly CDs. In a series of probes, Paraguayan prosecutors 

have alleged that pirated CDs were a main funding source for Islamic extremist groups such as 

Hizballah and Hamas.775

Paraguay’s thriving industry of pirated products is promoted by weak government 

support for enforcement measures, an obstructionist judiciary, and ineffective customs 

procedures. These conditions cause copyright and trademark owners to consider Paraguay 

a nightmare for their enterprises. Ciudad del Este is the pre-eminent route into Latin 

America for counterfeit CDs and CD-ROMs from Hong Kong, Macau, Malaysia, and 

Thailand. An estimated US$1.5 billion worth of goods are moved annually.776 Many 

Brazilian tourists visit Ciudad del Este to purchase cheap consumer goods. Although an 

estimated 90 percent of the products sold in Ciudad del Este are counterfeit, their low 

prices make them popular. Paraguayan legislation, which permits the patenting in 

Paraguay’s National Brand Register of international brand names, facilitates the pirating 

and sale of contraband merchandise.777 Much of this criminal activity has been linked to 

organized criminals based in Korea, Lebanon, Libya, and Taiwan, and the local press has 

uncovered numerous examples of corruption.778 In February 2000, the International 

Intellectual Property Alliance (IIPA) identified Paraguay as the most serious problem 

among various Latin American countries with intellectual property (IP) infringements.779

Islamic Terrorist Activities 

The TBA cities of Ciudad del Este and Foz do Iguaçu have served as a base for terrorists 

who pose potential threats to countries of the Americas. These terrorists have not carried out any 

known terrorist attacks within the TBA. Instead, they have used it as a base. The 2001 edition of 

 

775 Jones. 776 Bartolomé. 777 Bartolomé. 778 “Paraguay: 'Strong Ties' Seen Between Hong Kong Mafia, Tri-border Based Hizballah,” ABC Color [Asunción], 

22 November 2002 (FBIS Document LAP20021122000059). 

779 James Nurton, “Goodbye to A Difficult Year: The World's Leading IP Practices,” Managing Intellectual 

Property [London], June 2002, 56-70. 
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Patterns of Global Terrorism described the region as a hub for Islamic terrorist groups such as 

Hamas and Hizballah.780

In 2001 Francis X. Taylor, the Department of State’s coordinator for counterterrorism, 

told the U.S. Congress that the TBA has a “....longstanding presence of Islamic extremist 

organizations, primarily Hizballah, and, to a lesser extent, the Sunni extremist groups, such as 

the Egyptian Islamic Group (Gamaat i-Islami) and Hamas.”781 Taylor noted that the activities of 

these organizations include fund-raising and proselytizing among the region’s Middle Eastern 

population, as well as document forgery, money laundering, contraband smuggling, and weapons 

and drug trafficking. In 2002 Mark Davidson of the U.S. Embassy in Asunción described the 

TBA as indisputably an area from which Islamic terrorism is financed by money derived from 

illicit activities.782

The bombing of the Israeli Embassy in Buenos Aires in 1992, which killed 29 people, 

allegedly was carried out by Hizballah and coordinated by Imad Mughniyah. In 1999, Argentine 

authorities issued arrest warrants for Mughniyah, who was identified in the TBA shortly before 

the attack.783 Mughniyah’s Islamic Jihad, one of the armed branches of the pro-Iranian Lebanese 

Hizballah party, claimed responsibility for the 1994 attack against the AMIA in Buenos Aires. 

Clues indicated that the explosives or detonators used in the 1994 AMIA bombing were taken 

from Foz do Iguaçu. Mughniyah was indicted for the bombing, based on what investigators 

called conclusive evidence that the bombing had been explicitly ordered by Hizballah.784

Since 1998, the investigation of an alleged role in the 1994 bombing by Iranian 

diplomats has been stalled, and none of the suspects have been prosecuted.785 However, in March 

2003 an Argentine judge ordered arrest warrants for four Iranian government officials who 

allegedly helped to organize and carry out the 1994 AMIA bombing.786

 

780 U.S. Department of State, Office of the Coordinator for Counterterrorism, Patterns of Global Terrorism 2001. 

<http://www.state.gov/s/ct/rls/pgtrpt/2001/html/10246.htm> 781Anthony Faiola, “U.S. Terrorist Search Reaches Paraguay; Black Market Border Hub Called Key Finance Center 

for Middle East Extremists,” Washington Post, 13 October 2001, A21. 782 Jon Dougherty, “Could Terrorists Strike from Caribbean?” WorldNetDaily, 9 January 2002. 

<http://www.worldnetdaily.com/news/article.asp?ARTICLE_ID=25977> 

783Faiola. 784 “Argentina Issues Arrest Warrant for Senior Hezbollah Leader,” Middle East Intelligence Bulletin, 1, no. 9 

(September 1999). 

785 Blanca Madani, “New Report Links Syria to 1992 Bombing of Israeli Embassy in Argentina,” Middle East 

Intelligence Bulletin, 2, no. 3 (March 2000). 786 Larry Rohter, “Argentine Judge Indicts 4 Iranian Officials in 1994 Bombing of Jewish Center,” New York Times, 

10 March 2003, A3. 
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Paraguay’s Vice Interior Minister Mario Agustin Sapriza confirmed in May 2001 that 

the TBA serves as a base of operations for dormant Islamic extremist cells linked to international 

terrorism. Sapriza explained that Hizballah, Hamas, and other terrorist organizations use this 

region to plan their actions, to obtain supplies, and to live for a certain period of time before 

launching new attacks in other countries.787

The commander of Argentina’s National Border Guard, Commandant General Hugo 

Miranda, offered a somewhat more specific report in October 2001, noting that conditions in the 

TBA favor the area's role as a hotbed of terrorist cells known as sleeper cells. Said Miranda, "We 

know that both in Ciudad del Este and in Foz do Iguaçu there is a community of Islamic origin. 

People in this community have ties to fanatical religious groups, and they are in contact with the 

Middle East countries. They have significant economic resources and the facilities for forging 

documents, so terrorist cells can be established there.788

Islamic Money Laundering and Other Fund-Raising

Blanca Madani, co-president of the World Amazigh Action Coalition (WAAC), has 

noted that Hizballah has also relied extensively on funding from the Shi'ite Lebanese Diaspora in 

the TBA.789 Islamic money laundering in the TBA is concealed by the common practice of the 

local Arab community of remitting funds to relatives in the Middle East. Some of these 

remittances are suspected of reaching Arab terrorist organizations, particularly Hizballah.790

During the 1999-2001 period, Islamic extremist groups received at least US$50 million 

from Arab residents in the area of Foz do Iguaçu through Paraguayan financial institutions. An 

investigation by Paraguay’s Secretariat for the Prevention of Money Laundering found that a 

group of 42 Arabs in Ciudad del Este remitted abroad, mostly to Lebanon, approximately US$50 

million, apparently during the 1997-2001 period. It is believed that these funds were derived 

from arms trafficking and other illicit activities.791 Paraguayan Interior Minister Julio César 

 

787 “Paraguay: Vice Interior Minister Confirms Presence of ‘Dormant Islamic Terrorist Cells,’” ABC Color

[Asunción], 4 May 2001 (FBIS Document LAP20010505000002). 

788 “National Border Guard Commander: Tri-Border Area Hotbed of Sleeper Cells,” La Nación [Buenos Aires], 3 

October 2001 (FBIS Document LAP20011003000015). 

789 Blanca Madani, “Hezbollah's Global Finance Network: The Triple Frontier,” Middle East Intelligence Bulletin, 4, 

no. 1 (January 2002). 

790 Bartolomé, 9. 791 Bartolomé, 9. 
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Fanego estimated the total amount to be between US$50 and US$500 million, with most 

remittances in the range of US$500 to US$2,000.792 Brazilian security agencies claimed that the 

financial aid offered in 2000 by groups in the TBA to Islamic and Middle Eastern terrorist 

organizations, such as Hizballah, Hamas, and the Islamic Jihad, totaled US$261 million.793

Links of Hizballah and al Qaeda

Al Qaeda apparently has long had an interest in the TBA. Although it is unclear when al 

Qaeda established a presence in the TBA, Osama bin Laden reportedly visited the area in 

1995.794 Another top al Qaeda leader, Khalid Sheikh Mohammed, spent 20 days in Foz do 

Iguaçu in 1998.795

In 1999 agents of Argentina’s Secretariat for State Intelligence (Spanish initialism SIDE) 

reported that al Qaeda agents had been identified in the TBA.796 An alleged plot by Osama bin 

Laden and Hizballah leader Imad Mughniyah would have destroyed the Jewish Education Center 

in the Buenos Aires suburb of Palermo.797 The larger objective reportedly was to conduct 

simultaneous attacks in Buenos Aires, Ciudad del Este, and Ottawa (Canada), and to draw world 

attention to undermine the Middle East peace process. 

The SIDE also reported a significant shift in the Muslim terrorist groups in the TBA.798

Until about 1999, pro-Iranian Shiite extremists organizations, such as the Islamic Jihad and the 

Lebanese Hizballah faction normally worked separately from the orthodox Sunnites. By mid1999, however, SIDE’s sources were finding evidence of collaboration. In the TBA, according to 

the SIDE’s sources, “...the Sunnite organization maintains various contacts with elements 

 

792 Roberto Cosso, “Extremistas receberam US$50 mi de Foz do Iguaçu” [Extremists Received US$50 Million from 

Foz do Iguaçu], Folha de S. Paulo [São Paolo], 31 December 2001. 793 Riyadh Alam-al-Din, "Washington Begins the War on Hizballah in the Border Triangle," Al-Watan al-Arabi

[Paris], 21December 2001, 18-19 (FBIS Document GMP20011221000179). 

794 “Brazil: Terrorist Khalid Sheikh Mohamed's Passage Through Brazil Reported,” O Estado de São Paulo [São 

Paolo], 9 March 2003 (FBIS Document LAP20030308000052). 

795 Kevin G. Hall, “Accused al-Qaida Terrorist Spent time in Brazil, Police Say,” Knight Ridder Tribune News 

Service, 13 March 2003, 1. 

796 Mario Daniel Montoya, “War on Terrorism Reaches Paraguay’s Triple Border,” Jane’s Intelligence Review, 13, 

no. 12 (December 2001): 12. 

797 Vladimir Jara Vera and Dany Ortiz, “Police Conduct Operation to Intimidate Islamic Extremists,” ABC Color

[Asunción], 23 December 1999 (FBIS Document FTS19991223001521). 798 “Tríplice fronteira tinha agentes sauditas, diz ‘Clarín’ [Triborder has Saudi Agents, Clarín Says], Estadão, 17 

September 2001. 
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suspected of being Hizballah sympathizers or affiliates.”799 However, the Buenos Aires daily 

Clarín reported that the SIDE’s reports were received with skepticism by the CIA and Israel’s 

Mossad.800 In September 2001, a Latin American expert on money laundering, Jude Walter 

Fanganiello Maierovitch, said that al Qaeda was establishing a base near Ciudad del Este, in an 

Arab community of 30,000 people.801 The new base would take advantage of existing al Qaeda 

links with TBA trafficking in arms, narcotics, and uranium, as well as ongoing money laundering 

activities, in association with the Russian and Chinese mafias. The base would use religious 

entities as fronts for training terrorists and providing refuge for Islamic fugitives. 

Rio de Janeiro’s O Globo reported in late October 2001 that the FBI, in close 

collaboration with the CIA, had discovered evidence that al Qaeda is making the TBA its main 

center of operations in Latin America. The area allegedly is the headquarters for two separate 

financial and drug-trafficking depots. The latter supposedly has a direct connection with the 

FARC.802

Conclusion 

A deeply rooted system fosters organized crime and terrorist activities in the TBA and 

elsewhere in Argentina, Brazil, and Paraguay. That system is sustained by societal, institutional, 

economic, and geographic factors. A combination of those factors has made the TBA a remote 

enclave that defies effective law enforcement. A primary obstacle to effective crime prevention 

is widespread corruption in the political and law enforcement systems of the three countries 

whose territory is included in the TBA. In Brazil and Paraguay, permissive banking systems 

foster the money laundering that is a vital adjunct of the arms and narcotics trafficking industries. 

The same conditions that allow domestic crime to flourish are potent attractions for transnational 

criminal groups and terrorist organizations. Criminal groups from many countries are present in 

the TBA. Major international terrorist groups, including al Qaeda and Hizballah, appear to have 

 

799Daniel Santoro, “Bin Laden's Followers in Triborder Area Probed,” Clarín [Buenos Aires], 18 July 1999 (FBIS 

Document WA1907180899); Daniel Santoro, “Argentine Intelligence Services' 1999 Report on Usamah Bin-Ladin's 

Agents in Triborder Area Viewed,” Clarín [Buenos Aires], 16 September 2001, 8-9, 1 (FBIS Document 

LAP20010916000021). 

800 Santoro, FBIS Documents WA1907180899 and LAP20010916000021. 801Germano Oliveira, “Brazil’s Former Drug Czar: Bin-Ladin Establishing Al-Qa’idah Cell on Triborder,” O Globo

[Rio de Janeiro], 19 September 2001 (FBIS Document LAP200109119000051). 

802 Jose Meirelles Passos, “The Shadow of Bin Laden in Latin America,” O Globo [Rio de Janeiro], 29 October 2001 

(FBIS Document LAP20011029000036). 
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established planning bases in the TBA, from which operations can be conducted in other 

countries. 
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Menkhaus, Ken. “Political Islam in Somalia,” Middle East Policy, 9, no. 1 (March 2002). 

Menkhaus, Ken. “Somalia: In the Crosshairs of the War on Terrorism,” Current History, 101, no. 

655, May 2002, 195-202. 

“Mombasa Main Conduit for Drug Trafficking,” International Action Network on Small Arms 

report, 18 June 2001. <http://www.iansa.org/news/2001/jun_01/mombasa.htm> 

“Mozambique: A Flood of Mud,” Africa Confidential [London], 43, no. 25 (December 20, 

2002). 
Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

- 201 -

Muiruri, Stephen. “How Illegal Migrants Use Kenya’s Airports,” 13 August 2002. 

<http://fpmail.friends-partners.org/pipermail/stop-traffic/2002/002266.htm> 

Mutua, Martin. “Kibaki Opens Parliament, Vows to Fight Corruption,” East African Standard

[Nairobi], 19 February 2002. <http://allafrica.com/stories/200302190693.html> 

Muyita, Solomon. “Uganda Major Point in Arms Trafficking,” New Vision [Kampala], 15 July 

2001. <http://allafrica.com> 

Namburete, Antonio Paolo. “Organised Crime in Mozambique and Its Impact Within the 

Regional and International Context,” Pages 26-36 in M. Hough and A. Du Plessis, eds., The 

Grim Reaper: Organised Crime in the 1990s—Implications for South and Southern Africa. Cape 

Town: Institute for Strategic Studies, 1999. 

Nelson, Craig, and Philip Sherwell. “Business as Usual for Africa’s ‘Merchant of Death,’” The 

Sunday Telegraph [London], 22 July 2001. 

<http://www.iansa.org/news/2001/jul_01/busi_usual.htm> 

“New Ambitions in the Fight Against Drugs,” Geopolitical Drug Newsletter [Paris], October 

2001. <http://www.geodrugs.net/mini-lettres/AEGD6GB.pdf> 

“Nigeria: Defence Minister Denounces Increased Number of Small Arms in Country,” BBC 

report, 14 January 2002. <http://www.clw.org/atop/newswire/nw011402.htm> 

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Park, Steve. “‘Victor B’ Watched for Taliban Ties,” Washington Times, 22 July 2002. 

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Porzio, Giovanni. “Somalia Ready for the Fireworks,” Milan Panorama, 7 February 2002, 44-46 

(FBIS Document EUP20020203000135). 

“Repairing Our Broken Dream,” East African Standard [Nairobi], 29 December 2002, as quoted 

in Africa Research Bulletin, Political, Social, and Cultural Series [Oxford, United Kingdom], 39, 

no. 12 (24 January 2003). 

“Responding to War and State Collapse in West Africa,” United States Institute for Peace special 

report, 21 January 2002. 

Sengupta, Somini. “Chaos in West Africa: Unending Wars,” New York Times, 5 May 2003. 

Shaw, Mark, and Peter Gastrow. “Stealing the Show? Crime and Its Impact in Post-Apartheid 

South Africa,” Daedalus, 130, no. 1 (Winter 2001). 
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- 202 -

Smucker, Philip, and Faye Bowers. “Iraq Regime Linked to Terror Group,” Christian Science 

Monitor, 18 April 2003, 1. 

Sullivan, Robert E. “Burgeoning Small Arms Trade Has High Profits and Losses,” Earth Times, 

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“Trafficked Children Registered,” report of AllAfrica.com, 4 February 2003. 

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Trofimov, Yaroslav. “In Mombasa Streets, Bin Laden Is ‘Hero,’ And U.S. Is Hated,” Wall Street 

Journal, Monday, 2 December 2002, A1. 

Turetzky, Marc David. “Egypt, Mubarak, and the Rise of Islamic Fundamentalist Terrorism, 

1981-1994: An Empirical Analysis of the Mubarak Regime’s Punitive Counter-Terrorist Policy,” 

Michigan Journal of Political Science, no. 24 (Winter 1998). 

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United Nations. Office for the Coordination of Humanitarian Affairs. “East Africa: Small Arms 

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November 2001. 

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United States. Office of the President. International Crime Threat Assessment. Washington, 

D.C.: 2000. http://clinton4.nara.gov

U.S. Department of State. Patterns of Global Terrorism 2002. 

<http://www.usis.usemb.se/terror/rpt2002/index.html> 

U.S. Department of State. Trafficking in Persons Report 2002. 

<http://www.state.gov/g/tip/rls/tiprpt/2002> 

U.S. Department of State. Bureau for International Narcotics and Law Enforcement Affairs. 

International Narcotics Control Strategy Report 2002. Washington: 2002. 

<http://www.state.gov/g/inl/rls/nrcrpt/2002> 

U.S. Department of State, Bureau for International Narcotics and Law Enforcement Affairs. 

International Narcotics Control Strategy Report 2003. Washington, D.C.: Department of State, 

2003. 

U.S. Department of State. Bureau of Intelligence and Research. “Arms and Conflict in Africa.” 

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U.S. Department of State and Federation of American Scientists, Intelligence Resource Program. 

“Salafist Group for Call and Combat (GSPC).” <http://www.fas.org/irp/world/para/salaf.htm> 
Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

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“Washington Possibly Examining Militancy Threat in West Africa,” Stratfor report, 14 

November 2002. http://www.stratfor.com

Wax, Emily. “Marines Comb Borders As Worries Rise in Kenya,” The Washington Post, 17 May 

2003. 

Weiser, Benjamin. “Details Given, and 5 More Charged, in Tanzania Bombing,” New York 

Times, 17 December 1998. 

“West African Arms Trafficking and Mercenary Activities Supported by the Liberian 

Government and Logging Companies,” Global Witness report, 31 March 2003. 

<http://www.globalwitness.org/text/press_releases/display2.php?id=186> 

Williams, Phil, and Doug Brooks. “Captured, Criminal, and Contested States: Organised Crime 

and Africa in the 21st Century,” South African Journal of International Affairs, 6, no. 2 (Winter 

1999). 

Former Soviet Union and Eastern Europe 

Adamoli, Sabrina. “Organised Crime and Money Laundering Trends and Countermeasures: A 

Comparison Between Western and Eastern Europe,” in PetrusC. van Duyne, Vinzenzo Ruggiero, 

Miroslav Scheinost, and Wim Valkenburg, eds., Cross-Border Crime in a Changing Europe. 

Huntington, New York: Nova Science Publishers, 2001. 

Akopyan, Armen. “Joint Fight Against Crime,” Ayots Askar [Erevan], 23 March 2002 (FBIS 

Document CEP20020323000069). 

“Albania: Cash-for-Guns Plan Misfires,” Institute for War and Peace Reporting Balkan Crisis 

Report, 379 (4 November 2002). <http://www.iwpr.net> 

“Albania: Smuggling Continues Despite Multinational Efforts,” RFE/RL Crime and Corruption 

Watch, 2, no. 30 (30 August 2002). <http://www.rferl.org/corruptionwatch> 

American University. Transnational Crime and Corruption Center, Vladivostok Centre for 

Research on Organized Crime. “Summary of Crime in the Region 2001.” 

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Aminyeva, Yana, and Viktoria Chernysheva. “Organized Crime in the Far East: Press Survey for 

Maritime Province, January 2000,” Organized Crime and Corruption Watch, Summer 2000. 

Aminyeva, Yana, and Viktoria Chernysheva. “Organized Crime in the Far East: Press Survey for 

Maritime Province and the Khabarovsk Region, February 2000,” Organized Crime and 

Corruption Watch, Summer 2000. 
Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

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Aminyeva, Yana, and Viktoria Chernysheva. “Organized Crime in the Far East: Press Survey for 

Maritime Province and the Khabarovsk Region, March 2000,” Organized Crime and Corruption 

Watch, Summer 2000. 

Anisko, Sergey. “Belarus Chechens Display Patriotism: Local Power Departments Claim That 

Chechen Mafiya Sends Half the Money It Earns to the Homeland,” Segodnya [Moscow], 12 

January 1998 (FBIS Document 19980113001126). 

Antichenko, Viktor. “The State: It Is I and My Daughter,” Novaya Gazeta [Moscow], 17 June 

2002 (FBIS Document CEP20020620000337). 

“Armenian Anticorruption Drive Creates Doubt,” RFE/RL Crime and Corruption Watch, 2, no. 

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Armenian Center for National and International Studies. “ACNIS Roundtable on AntiCorruption Strategies,” 27 September 2002. <http://www.acnis.am/pr/corruption> 

“Arrest Illegal Capital but Grant No Amnesty,” Asia-Plus [Dushanbe], 18 April 2002 (FBIS 

Document CEP20020427000054). 

Arsov, Darko. “Money Laundering: The Most Sophisticated Form of Organized Crime,” 

Ministry of Finance Bulletin [Skopje], December 2001. 

<http://www.finance.gov.mk/gb/bulletins> 

Atayev, Artur. “There Is No Organized Crime,” Nezavisimaya Gazeta [Moscow], 5 March 2002 

(FBIS Document 20020305000162). 

Australia. Ministry for Defence. “Report of the Experts Team Visit to Ukraine,” 28 November 

2002. 

“Azerbaijani Women Mainly Trafficked to Turkey, United Arab Emirates,” Trend News Agency 

[Baku] report, 14 June 2002 (FBIS Document CEP20020614000274). 

Babić, Jasna. “MORH Protects Arms Dealers Who Smuggle Weapons to ETA and IRA,” 

Nacional [Zagreb], 24 July 2001 (FBIS Document EUP20010724000372). 

Babić, Jasna. “SZUP Document Confirms Existence of Another Crime Organization,” Nacional

[Zagreb], 10 September 2002 (FBIS Document EUP20020910000188). 

Baker, Peter. “In Struggling Moldova, Desperation Drives Decisions,” Washington Post, 1 

November 2002. 

Baker, Peter. “Renewed Militancy Seen in Uzbekistan,” Washington Post, 27 September 2003. 

The Balkan Times, 29 August 2002. <http://www.balkantimes.com> 
Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

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“Balkans: Organized Crime in the Region,” RFE/RL Crime and Corruption Watch, 2, no. 31 (6 

September 2002). <http://www.rferl.org/corruptionwatch> 

“Banned Islamic Movement Still a ‘Real Threat’ to Uzbek Security—Kazakh Paper,” BBC 

Monitoring Central Asia Unit, based on report in Karavan [Almaty], 1 March 2002. 

Barnett, Neil. “The Criminal Threat to Stability in the Balkans,” Jane’s Intelligence Review, 1 

April 2002. 

Baumanis, Romans, and Arnolds Karklis. “Public-Private Cooperation Urgently Needed to Halt 

Transit of Counterfeits by Organized Crime and Terrorist Groups.” Coalition for Intellectual 

Property Rights report, 10 December 2001. <http://www.cipr.org> 

Beare, Margaret. “Russian (East European) Organized Crime Around the Globe.” Paper read at 

Transnational Crime Conference, Canberra, 9 March 2000. 

“Belarus: Interior Minister Reveals 6,000 Crimes Committed by Police Staff in 2002,” Belapan

[Minsk], 29 November 2002 (FBIS Document CEP20021129000363). 

“Belarus Sells Arms to Regimes Harboring Terrorists, Says NS,” International League for 

Human Rights, Belarus Updates, 4, no. 42 (October 2001). <http://www.ilhr.org> 

Beregovoy, Anatoliy. “Asian Eclipse: The Standoff Between the Kazakhstani Authorities and 

Opposition Has Come to a Head,” Nezavisimaya Gazeta [Moscow], 4 April 2002 (FBIS 

Document CEP20020405000042). 

Berniker, Mark. “Tajikistan Strives for Growth amid Risk and Poverty,” Eurasianet report, 11 

June 2003. <http://www.eurasianet.org> 

Blank, Steven. “Kyrgyzstan: Strategic Pivot,” Central Asia/Caucasus Analyst, 18 December 

2002. <http://www.cacianalyst.org> 

Bondarenko, Mariya. “The North Caucasus Is the Hottest Region When It Comes to Drugs, 

Too,” Nezavisimaya Gazeta [Moscow], 15 April 2002 (FBIS Document CEP20020416000232). 

Borisov, Timofey. “Has Gelayev Got His Eye on the Chechen Leadership? But Before That He 

Tried Out the Route from Ichkeria to Dagestan,” Rossiyskaya Gazeta [Moscow], 15 May 2002 

(FBIS Document CEP20020515000283). 

“Bosnia Suspends Military Exports,” VOA News report, 29 October 2002. 

<http://voanews.com> 

Bregu, Zylyftar. “Albania: Authorities Rocked by Drugs Scandal,” Institute for War and Peace 

Reporting, 22 March 2002. <http://www.iwpr.net> 
Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

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British Helsinki Human Rights Group. “Sex Slaves: Trafficking in Human Beings from Moldova 

to Italy.” <http://www.bhhrg.org> 

“Bulgaria: NGO Alleges Money Laundering by Grain Traders,” RFE/RL Crime and Corruption 

Watch, 2, no. 31 (6 September 2002). <http://www.rferl.org/corruptionwatch> 

Burant, Stephen R. Hungary: A Country Study. Washington, D.C.: GPO, 1990. 

Burrell, Ian. “Sex, Drugs and Illegal Migrants: Sarajevo’s Export Trade to Britain,” The 

Independent, 21 January 2002. <http://www.independent.co.uk> 

“Central Asia: Governments Slowly Changing Approach to Human Trafficking,” Eurasianet

report, 6 July 2003. <http://www.eurasianet.org/departments/rights/articles/cav070603.shtm> 

Coalition for Intellectual Property Rights. “Latvian Government Incinerates 25 Million 

Cigarettes,” press release, 10 December 2001. <http://www.cipr.org/activities> 

Cohen, Ariel. “Ukrainian and Russian Organized Crime: A Threat to Emerging Civil Society.” 

Pages 285-302 in Sharon L. Wolchik and Volodymyr Zviglyanich, eds. Ukraine: The Search for 

a National Identity. Lanham, Maryland: Rowman and Littlefield, 2000. 

Collins, Jan K. “Doing Business in the Baltic.” <http://www.research.moore.sc.edu> 

Cornell, Svante E. “The Nexus of Narcotics, Conflict, and Radical Islamism in Central Asia,” 

Cornell Caspian Consulting, Caspian Briefs, no. 24 (June 2002). 

Cornell, Svante E., and Regina A. Spector. “Central Asia: More Than Islamic Extremists,” The 

Washington Quarterly, 25, no. 1 (2002). 

“Corruption,” Moldova Gateway, 2000. <http://www.gate.md/Article/267> 

“Corruption Gap May Work in Latvia’s Favor,” Radio Free Europe/Radio Liberty News Release, 

9 April 2001. <http://www.rferl.org> 

Council of Europe and Commission of the European Communities. “Final Recommendations 

and Guidelines for Action Addressed to the Government of Estonia,” 13 February 1998. 

Council of Europe. European Committee on Crime Problems, Select Committee of Experts on 

the Evaluation of Anti-Money Laundering Measures. “First Report on Latvia,” 19 January 2001. 

<http://www.coe.int> 

Council of Europe, European Committee on Crime Problems, Select Committee of Experts on 

the Evaluation of Anti-Money Laundering Measure. “Second Round Evaluation Report on 

Slovak Republic,” 8 April 2003. <http://www.coe.int> 
Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

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“Crime Rate in Kyrgyzstan Impedes Socio-Economic Reforms,” Pravda.ru, 21 August 2001. 

<http://www.english.pravda.ru> 

“Croatian Press Speculates on Underworld Groups’ Ties to Establishment,” Nacional [Zagreb], 

24 September 2002 (FBIS Document EUP20020923000505). 

“Czech Republic: Top Attorney Calls for Radical Solution to Widespread Corruption,” RFE/RL 

Crime and Corruption Watch, 2, no. 13 (4 April 2002). <http://www.rferl.org/corruptionwatch> 

Cvijanović, Zeljko. “Serbia: Government Facing Mafia Dilemma,” Institute for War and Peace 

Reporting, Balkan Crisis Report, no. 342 (12 June 2002). <http://www.iwhr.net> 

Daniels, Anthony. “Market Reform and Moldova,” British Helsinki Human Rights Group report, 

7 March 2001. <http://www.bhhrg.org> 

Davlatov, Vladimir. “Rakhmonov Warns of Afghan Terror Threat,” Institute for War and Peace 

Reporting, Report on Central Asia, no. 127 (28 June 2002). <http://www.iwpr.net> 

Demurian, Avet. “Armenia Escapes Drugs Epidemic,” Institute for War and Peace Reporting, 

Caucasus Reporting Service, no. 130 (23 May 2002). <http://www.iwpr.net> 

Diab, Hassan Haidar. “Panic in Slovakia Due to Possible Release of Josip Lončarić,” Večernji 

List [Zagreb], 21 November 2001 (FBIS Document EUP20011121000202). 

Dobbs, Michael. “Pivotal Alliance Frayed Before Serb’s Death,” Washington Post, 14 March 

2003. 

Dosybiev, Daur. “Kazakhstan: Police Corruption Worsens,” Institute for War and Peace 

Reporting, Report on Central Asia, no. 128 (5 July 2002). <http://www.iwpr.net> 

“Drug War for $1.2 Billion,” Trud [Sofia], 6 February 2001 (FBIS Document 

EUP20010206000047). 

Dziedzic, Michael, Laura Rozen, and Phil Williams. “Lawless Rule Versus Rule of Law in the 

Balkans,” United States Institute of Peace Special Report, no. 97 (December 2002). 

“The End of the Vory?” Jane’s Intelligence Review, 1 March 2002. 

Eshanova, Zamira. “Central Asia: Border Issues an 80-Year-Old Headache for Region,” 

Turkestan Newsletter, 20 October 2002. 

Eshanova, Zamira. “Central Asia: Report Says Police Have Improved Little since Soviet Era,” 

Eurasia Insight, 18 December 2002. <http://www.eurasianet.org> 

Estonia. Ministry of Justice. “Status Report of the Republic of Estonia under the Baltic AntiCorruption Initiative,” March 2002. <http://www.anticorruptionnet.org> 
Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

- 208 -

European Union. “Activities of the European Union, Summaries of Legislation,” 1 February 

2002. <http://europa.eu.int> 

Finckenhauer, James O., and Yuri A. Voronin. The Threat of Russian Organized Crime. 

Washington, D.C.: U.S. Department of Justice, 2001. 

“Focus on the Balkans,” Trafficking in Migrants, no. 22 (Autumn 2000). 

“Foreign Investors Call on New Government to Crack Down on Corruption,” RFE/RL Crime and 

Corruption Watch, 2, no. 27 (25 July 2002). <http://www.rferl.org/corruptionwatch> 

Galeotti, Mark. “Albanian Gangs Gain Foothold in European Crime Underworld,” Jane’s 

Intelligence Review, 1 November 2001. 

Gerlin, Andrea. “Sex Trafficking Is Flourishing in Balkans,” Philadelphia Inquirer, 15 April 

2002. <http://www.philly.com> 

Giragosian, Richard. “A Troubling Trend in Armenia,” RFE/RL Newsline, 7, no. 3 (7 January 

2003). 

Global March Against Child Labour. “Worst Forms of Child Labor Data: Kyrgyzstan.” 

<http://www.globalmarch.org> 

Glonti, Georgi. “Problems Associated with Organized Crime in Georgia,” report for Institute of 

Legal Reform [Tbilisi], 2000. 

Glonti, Georgi. “Trafficking in Human Beings in Georgia and the CIS,” Demokratizatsiya, 9, no. 

3 (Summer 2001). 

Gorobets, Alexander. “Italy Confirmed Connection of Top Ukrainian Officials with Illegal Arms 

Sales,” Pravda.ru, 1 October 2002. <http://www.english.pravda.ru> 

“Government Publishes Report on Widespread Corruption in Slovakia,” TASR news service 

[Bratislava], 8 September 2002 (FBIS Document EUP20020908000132). 

Hedl, Drago. “Links Between Organized Crime and Croatia’s Top Brass,” Alternativna 

Informativna Mreža (AIM) [Zagreb] report, 11 April 2001. <http://www.aimpress.org> 

Hignett, Kelly. “Hungary Takes on the Mafia,” Jane’s Intelligence Review, 1 January 2001. 

Hughes, Donna M. “The ‘Natasha’ Trade: Transnational Sex Trafficking,” National Institute of 

Justice Journal, no. 246 (January 2001). 
Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

- 209 -

Hughes, Donna M. “Short Report on Trafficking in Women from Ukraine Research Project,” 

National Institute of Justice, Research Partnership with Ukraine report, August 2001. 

<http://www.ojp.usdoj.gov/nij/international/programs/ukr_short> 

“Human Rights Group Says Corruption, Abuse of Power Still High,” reported in Basapress

[Chisinau], 21 May 2002 (FBIS Document CEP20020521000255). 

Human Rights Watch. “Arms Trade, Human Rights, and European Union Enlargement: The 

Record of Candidate Countries,” 8 October 2002. <http://www.hrw.org> 

Human Rights Watch. World Report 2002. http://www.hrw.org

International Action Network on Small Arms, “Central and Eastern Europe Remains Important 

Source and Transit Route for Arms: Country Analysis,” 2 July 2002. 

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International League for Human Rights. Belarus Update, 2, no. 42 (October 2001). 

<http://www.ilhr.org> 

International Organization for Migration. “Azerbaijan: Trafficking in Women,” IOM press 

briefing, 4 October 2002. <http://www.iom.net> 

Jerinić, Dragan. “Bosnia: Serb Minister Resigns over Customs Scandal,” Institute for War and 

Peace Reporting, Balkan Crisis Report, no. 343 (14 June 2002). <http://www.iwpr.net> 

Johnson, Mark. “Nukes and the Russian Mob,” Journal of Commerce, 13 (March 1998). 

Kaliyev, Rustam. “How the Mafias Were Formed,” pt. 1 of “Russia’s Organized Crime: A 

Typology,” Eurasia Insight, 17 June 2002. <http://www.eurasianet.com> 

Kalnins, Valts. “Corruption: The Battle Is Not Finished,” Diena [Riga], 30 August 2002 (FBIS 

Document CEP20020830000048) 

Kanani, Agim. “Albania: Breaking Cycle of Prostitution,” Institute for War and Peace Reporting, 

Balkan Crisis Report, 19 April 2002. <http://www.iwpr.net> 

Kanani, Agim. “Albania: Cash-for-Guns Plan Misfires.” Report of Institute for War and Peace 

Reporting, Balkan Crisis Report, 4 November 2002. 

Kaplan, Robert. “Crime and Democracy in Bulgaria,” The Globalist, 23 June 2001. 

<http://www.theglobalist.com> 

Kattoulas, Velisarios. “Russian Far East: Crime Central,” Far Eastern Economic Review, 30 

May 2002. 
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“Kazakhgate under Way,” International Eurasian Institute for Economic and Political Research 

report, 5 June 2002. <http://www.iicas.org> 

Kelmendi, Adriatik. “Kosovo Prostitution Racket Flourishes,” Institute for War and Peace 

Reporting, Balkan Crisis Report, no. 230 (28 March 2001). <http://www.iwpr.net> 

Kelmendi, Adriatik. “The Security Zone Between Montenegro and Kosovo Has Become a 

Paradise for Petrol Smugglers,” Institute for War and Peace Reporting, Balkan Crisis Report, 28 

February 2002. <http://www.iwpr.net> 

Khmelik, Natalya. “Military Bookends,” Sovershenno Sekretno [Moscow], 1 August 2002 (FBIS 

Document CEP20020813000393). 

Konstantinova, Elizabeth. “Bulgarian Gangs Provide Key Link in European Trafficking Chain,” 

Jane’s Intelligence Review, 1 November 2002. 

“Kosovo” Fuel Smugglers Flourishing.” Report of Institute for War and Peace Reporting, 28 

February 2002. <http://www.iwpr.net> 

Krajewski, K. “Drug Trafficking in Poland,” in Petrus C. van Duyne, Vinzenzo Ruggiero, 

Miroslav Scheinost, and Wim Valkenburg, eds., Cross-Border Crime in a Changing Europe. 

Huntington, New York: Nova Science Publishers, 2001. 

Kupchinsky, Roman. “Cesium Sale Thwarted in Lithuania,” RFE/RL Crime and Corruption 

Watch, 2, no. 22 (6 June 2002). <http://www.rferl.org/corruptionwatch> 

Kuzio, Taras. “Ukraine’s Virtual Struggle Against Corruption and Organized Crime,” RFE/RL 

Crime and Corruption Watch, 2, no. 31 (6 September 2002). 

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“Kyrgyz Security Official Again Warns of Imminent IMU Threat,” Central Asia and Caucasus 

Analyst, 3 July 2002. 

“Kyrgyzstan Must Act Against Terrorism and Religious Extremism,” Slovo Kyrgyzstana

[Bishkek], 18 October 2002 (FBIS Document CEP20021028000208). 

Landesman, Peter. “Arms and the Man,” New York Times Magazine, 17 August 2003. 

Larsson, Frederic. “Trafficking in Women to Bosnia and Herzegovina,” Trafficking in Migrants, 

Autumn 2000. 

Latvia. Ministry of Justice. “Status Report of the Republic of Latvia under the Baltic AntiCorruption Initiative,” April 2002. <http://www.anticorruptionnet.org> 

“Latvian Officials May Have Interest in Russian Crime Group,” Neatkagiga Rita Avize [Riga], 

22 February 2001 (FBIS Document CEP20010222000055). 
Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

- 211 -

“Latvia’s Anticorruption Effort Gets High Marks,” RFE/RL Crime and Corruption Watch, 1, no. 

6 (6 December 2001). <http://www.rferl.org/corruptionwatch/2001> 

“Law Enforcement in Kosovo,” Jane’s Intelligence Review, 1 April 2002. 

Layne, Mary. “Estimating the Flow of Illegal Drugs Through Ukraine, National Institute of 

Justice Research Partnership with Ukraine conference paper, September 2001. 

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Ledeneva, Alena V., and Marina Kurkchiyan, eds. Economic Crime in Russia. The Hague: 

Kluwer Law International, 2000. 

Liklikadze, Koba. “What Money Laundering Has to Do with Terrorism,” 24 Saati [Tbilisi], 18 

October 2002 (FBIS Document CEP20021021000156). 

Linotte, Daniel, and Gianluca Rampolla. “Fighting Corruption in Georgia: The Need for a LongTerm and Comprehensive Perspective,” Central Asia/Caucasus Analyst, 25 April 2001. 

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“Lithuania.” Activities of the European Union, Summaries of Legislation, 1 February 2002. 

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Lithuania. Ministry of Finance. “Supplementary Memorandum of Economic Policies of the 

Government and the Bank of Lithuania for the Period May-December 2002.” 

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Lithuania. Ministry of the Interior. Financial Crime Investigative Service. “Money-Laundering 

Prevention: Legal Acts.” <http://www.fmtt.lt/eng.mlp> 

Lomas, Ulrika. “Hungary Bans Anonymous Accounts in Response to FATF Listing,” Tax-News 

[Brussels], 3 September 2001. 

Loriya, Yelena. “Nikolay Reznichenko: Tourists Used to Walk along the Gunman’s Paths,” 

Izvestiya [Moscow], 24 May 2002 (FBIS Document CEP20020524000290). 

Lvov, Mikhail. “The Northwest: The Criminal Element,” Freelance Bureau [Moscow] Internet 

report, 10 June 2002 (FBIS Document CEP20020613000225). 

“Macedonia Has the Largest Transit of Drugs for the Albanian Narco Mafia,” 6 November 2001. 

<http://www.realitymacedonia.org.mk> 

“Macedonian Government Confirms Ethnic Albanians Buying Arms from Drug Funds,” Nova 

Makedonija [Skopje], 20 February 2002. 
Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

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“Main Anti-Organized Crime Department Comments on Crime Statistics,” Interfax News 

Agency [Moscow] report, 23 July 2002. 

“Major Drug Busts Made by Hungarians, Russians, Romanians,” RFE/RL Crime and Corruption 

Watch, 2, no. 35 (4 October 2002). <http://www.rferl.org/corruptionwatch> 

Makarenko, Tamara. “Crime, Terror and the Central Asian Drug Trade,” Harvard Asia 

Quarterly, Summer 2002. 

Makarenko, Tamara. “Kyrgyzstan and the Global Narcotics Trade,” Eurasia Insight, 8 December 

1999. <http://www.eurasianet.org> 

Makarenko, Tamara. “Ukrainian Mafia Moves into the International Crime Arena,” Jane’s 

Intelligence Review, 1 February 2002. 

Matejickova, Maša. “Ivan I. Miško on His Contacts with S. Mogilyev, Strong Man of the 

Ukrainian Mafia in the World,” SME [Bratislava], 11 January 2000 (FBIS Document 

FTS20000115000458). 

McConnell, Artie. “Islamic Radicals Regroup in Central Asia,” online report of Eurasia Insight, 

15 May 2002. <http://eurasianet.org> 

McMahon, Robert. “Yugoslavia: Arms Expert Traces Belgium-to-Liberia Arms Trafficking,” 

Radio Free Europe/Radio Liberty report, 11 January 2002. <http://rfe/rl.org> 

Meyer, Henry. “Russian Mafia Extends Tentacles Across the Globe,” Agence France Presse 

[Paris] report, 15 August 2002. 

Mois, Jüri. “Organised Crime and Illegal Immigration in Estonia,” speech to Baltic Assembly, 

14th session, 27 May 1999. <http://www.baltsam.org/activity> 

“Much Remains to Be Done in Fight Against Corruption in Latvia,” Diena [Riga], 30 August 

2002 (FBIS Document CEP20020830000048). 

Mutschke, Ralf. “Links Between Organized Crime and ‘Traditional’ Terrorist Groups,” 

testimony to U.S. House Judiciary Committee, Subcommittee on Crime, 13 December 2000. 

<http://www.russianlaw.org/Mutschke> 

Nadiroglu, R. “Ben Ladin’s Ties to Arms Are Much More Extensive Than It Appears,” Internet 

report of Zerkalo [Baku], 6 December 2002 (FBIS Document CEP20011206000417). 

Namoradze, Zaza, Goka Gabashvili, and George Papuashvili. “Georgia Appeals to Public to 

Help Fight Corruption,” Open Society News, no. 8 (Spring 2001). 

<http://www.soros.org/open_society_news> 
Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

- 213 -

Nelson, Todd H. “Russian Realities: Nuclear Weapons, Bureaucratic Maneuvers, and Organized 

Crime,” Demokratizatsiya, 8, no. 1 (Winter 2000). 

“New Bribery Scandal,” RFE/RL Crime and Corruption Watch, 1, no. 6 (6 December June 

2001). <http://www.rferl.org/corruptionwatch> 

Nikolov, Jovo. “Crime and Corruption after Communism: Organized Crime in Bulgaria,” East 

European Constitutional Review, 6, no. 4 (Fall 1997). <http://www.law.nyu.edu/eecr> 

Nuclear Threat Initiative. “Kazakhstan Overview,” February 2002. <http://www.nti.org> 

Observatoire Géopolitique des Drogues. The World Geopolitics of Drugs, 1998/1999. Dordrecht: 

Kluwer, 2001. 

Olcott, Martha Brill, and Natalia Udalova. “Drug Trafficking on the Great Silk Road: The 

Security Environment in Central Asia,” Carnegie Endowment for International Peace Working 

Papers, no. 11 (March 2000). 

Organisation for Economic Cooperation and Development. Financial Action Task Force on 

Money Laundering. “Members and Observers: PC-R-EV Committee.” http://www1.oecd.org/fatf

Organisation for Economic Cooperation and Development. Financial Action Task Force on 

Money Laundering. “Report on Money-Laundering Typologies 2001-2002.” 

<http://www1.oecd.org/fatf/pdf/TY2002_en.pdf> 

Organisation for Economic Cooperation and Development. Financial Action Task Force on 

Money Laundering. “Review to Identify Non-Cooperative Countries or Territories,” 21 June 

2002. <http://www1.oecd.org/fatf-gafi.org/pdf/NCCT2002> 

Organisation for Economic Cooperation and Development, Financial Action Task Force on 

Money Laundering. “Annual Review of Non-Cooperating Countries or Territories,” 20 June 

2003. <http://www1.oecd.org/fatf/pdf/NCCT2003_en.pdf> 

“Organized Crime in St. Petersburg: Press Survey, February 2000,” Organized Crime and 

Corruption Watch, Summer 2000. 

Orttung, Robert. “Russia’s Southern Regions: Threats and Opportunities,” East-West Institute 

Policy Brief, 1, no. 2 (June 2002). 

Osser, Bernard. “In the East, the Specter of Another Iron Curtain,” Le Figaro [Paris], 8 March 

2002 (FBIS Document EUP2002031000003). 

Osyka, I. “Organised Economic Crime Problems in the Ukraine,” in Petrus C. van Duyne, 

Vinzenzo Ruggiero, Miroslav Scheinost, and Wim Valkenburg, eds., Cross-Border Crime in a 

Changing Europe. Huntington, New York: Nova Science Publishers, 2001. 
Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

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“’Overindulgence’ in Bribery,” RFE/RL Crime and Corruption Watch, 2, no. 27 (25 July 2002). 

<http://www.rferl.org/corruptionwatch> 

“Pakistani Islamists Active in Kazakhstan?” RFE/RL Newsline, 6, no. 129 (12 July 2002). 

Panfilova, Viktoriya, and Roman Ukolov. “Anti-Terror No Bar to Drug Traffickers: Hopes for a 

Diminution in the Flow of Dope Have Not Been Justified,” Nezavisimaya Gazeta [Moscow], 4 

February 2002 (FBIS Document CEP20020204000277). 

“Paper Accuses Communist Authorities of Protecting Oil, Arms Smugglers,” Tara [Chisinau], 

13 June 2002 (FBIS Document CEP20020617000276). 

Pasztelanski, Rafal. “You Should Not Mess Around with ‘Wolf,’” Zycie [Warsaw], 28 August 

2002 (FBIS Document EUP200208300000246). 

Petruseva, Anna. “Macedonia: Threats Follow Corruption Report,” Institute for War and Peace 

Reporting, Baltic Crisis Report, 21 August 2002. <http://www.iwpr.net> 

Peuch, Jean-Christophe. “Georgia: Corruption Seen as the ‘Norm,’” Radio Free Europe/Radio 

Liberty report, 5 October 2001. 

<http://www.rferl.org/nca/features/2001/05/1005200115630.asp> 

Picarelli, John T., and Phil Williams. “Structure and Scope of Ukrainian Organized Crime,” 

American Society of Criminology conference, 15 November 2000. <http://www.asc41.com> 

“Poland: Country Used to Launder Large Amounts of Money,” RFE/RL Crime and Corruption 

Watch, 2, no. 41 (3 December 2002). <http://www.rferl.org/corruptionwatch> 

Popa, Razvan. “We Have Secured Our Eastern Border, but We Are Attacked to the South: 

Bulgaria Is Throwing Waves of Illegal Immigrants to Us Across the Border,” Adevarul

[Bucharest], 25 July 2002 (FBIS Document EUP20020725000182). 

Pritchard, Eleanor. “Smuggled Smokes a Problem,” Central European Review, 2, no. 25 (26 

June 2000). <http://www.ce-review.org> 

“Racovat, Moldova: Immigrant Trafficking,” Network of East-West Women report, 21 June 

2000. <http://lists.partners-intl.net/pipermail/women-east-west> 

Radu, Paul Cristian. “Romania Tackles Human Traffickers,” Institute for War and Peace 

Reporting, Balkan Crisis Report, no. 357 (9 August 2002). <http://www.iwpr.net> 

Rasidoglu, A. “Corruption Has Taken on a Menacing Character,” Zerkalo [Baku], 22 June 2002 

(FBIS Document CEP20020710000409). 
Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

- 215 -

Rawlinson, Paddy. “Russian Organised Crime and the Baltic States: Assessing the Threat,” 

University of Wales Centre for Comparative Criminology and Criminal Justice, Working Paper, 

38/01. 

Rawlinson, Patricia. “Baltic States Battle Organised Crime,” Jane’s Intelligence Review, 1 

November 2001. 

Repetskaya, A., and V. Shakina. “Organized Crime in Irkutsk: Press Survey, February 2000,” 

Organized Crime and Corruption Watch, Summer 2000. 

Ristić, B. “Whose Arm Runs Serbia?” Glas Javnosti [Belgrade], 3 November 2002 (FBIS 

Document EUP20021104000406). 

Rosen, Nir. “Mafia Fuels Balkans Turmoil,” Institute for War and Peace Reporting, Balkans 

Crisis Report, no. 333 (26 April 2002). <http://www.iwpr.net> 

“Russian CD Piracy on Kremlin Property,” RFE/RL Crime and Corruption Watch, 2, no. 31 (6 

September 2002). <http://www.rferl.org/corruptionwatch> 

“Russian Counterfeiting on the Rise,” RFE/RL Crime and Corruption Watch, 2, no. 28 (8 August 

2002). <http://www.rferl.org/corruptionwatch> 

“Russian Customs Officials Seize over 27 Tonnes of Enriched Uranium,” TVS [Moscow] report, 

8 October 2002. 

Ryabtsev, Denis. Interview with Emanuil Yordanov, minister of the interior of Bulgaria, 

Segodnya [Moscow], 6 December 2000. 

Scheinost, Miroslav. “Transnational Organised Crime and Cross-Border Trafficking in Human 

Beings in the Czech Republic,” in Petrus C. van Duyne, Vinzenzo Ruggiero, Miroslav Scheinost, 

and Wim Valkenburg, eds., Cross-Border Crime in a Changing Europe. Huntington, New York: 

Nova Science Publishers, 2001. 

Shelley, Louise. “Crime and Corruption: Enduring Problems of Post-Soviet Development,” 

Demokratizatsiya, 11, no. 1 (Winter 2003). 

Shelley, Louise. “Organized Crime and Corruption Are Alive and Well in Ukraine,” World Bank 

Group, Transition Newsletter, January-February 1999. 

<http://www.worldbank.org/transitionnewsletter> 

Shelley, Louise. “Organized Crime in the Former Soviet Union: The Distinctiveness of 

Georgia,” in Institute of Legal Reforms [Tbilisi], Legal Aspects of Struggle Against Organized 

Crime and Corruption in Georgia. Tbilisi: 1999. 

Shpakova, Sasha. “A War Against Drug Trafficking in Kyrgyzstan,” Central Asia/Caucasus 

Analyst, 25 April 2001. <http://www.cacianalyst.org> 
Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

- 216 -

Sinitsyn, Fedor. “Corruption in the Federal Migration Service of Russia,” Organized Crime and 

Corruption Watch, Spring-Summer 2001. 

“Smuggling Continues Despite Multinational Effort,” RFE/RL Crime and Corruption Watch, 2, 

no. 30 (30 August 2002). <http://www.rferl.org/corruptionwatch> 

Southeast European Legal Development Initiative. “Corruption Indexes: Regional Corruption 

Monitoring in Albania, Bosnia and Herzegovina, Croatia, Macedonia, Romania, and 

Yugoslavia,” April 2002. 

Spirin, Yuriy. “Heroin Heroes,” Stringer News Agency report, 12 February 2002 (FBIS 

Document CEP20020219000161). 

Stanimirović, Sinisa. “Serbia: Corruption Clampdown,” Institute for War and Peace Reporting, 

Balkan Crisis Report, no. 315 (6 February 2002). <http://www.iwpr.net> 

Starostin, Dmitriy. “Osmium Worries the FSB,” Vremya Novostey [Moscow], 27 September 

2002. <http://www.nti.org> 

Stoecker, Sally W. “The Rise in Human Trafficking and the Role of Organized Crime,” 

Demokratizatsiya, 8, no. 1 (Winter 2000). 

Sultanoglu, S., and N. Majidova. “Azerbaijan Is One of the World Leaders in Corruption,” 

Zerkalo [Baku], 10 September 1999. <http://www.aliyev.com> 

“Suspected Accomplice Says She Spent Years Collecting Bribes Related to Ministry Contracts,” 

RFE/RL Crime and Corruption Watch, 2, no. 27 (27 July 2002). 

<http://www.rferl.org/corruptionwatch> 

Tabyshalieva, Anara. “Kyrgyz Turmoil over a Border Agreement,” Central Asia/Caucasus 

Analyst, 22 May 2002, 9-10. 

Tessadori, Vincenzo. “Drugs for Weapons: The Market of Terror,” La Stampa [Turin], 24 June 

2002 (FBIS Document EUP20020624000015). 

Titorenko, Larissa G. “The Walls That Have Yet to Fall: Belarus as a Mirror of CIS Transition,” 

Demokratizatsiya, 8, no. 2 (Spring 2000). 

“Top Attorney Calls for Radical Solution to Corruption,” RFE/RL Crime and Corruption Watch, 

2, no. 13 (4 April 2002). <http://www.rferl.org/corruptionwatch> 

“Trafficking in Prostitutes Is Urgent Problem in Latvia,” LETA (news agency) report, 7 June 

2002 (FBIS Document CEP20020607000086). 
Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

- 217 -

“Trafficking in Women in the Baltic States: Legal Aspects,” Trafficking in Immigrants, special 

issue, 2001. 

Transparency International. “Corruption Perceptions Index 2002.” 

<http://www.transparency.org/cpi/2002/cpi2002en.html> 

U.S. Agency for International Development. “Combating Human Trafficking in Bulgaria,” 25 

April 2003. <http://www.usembassy.bg/prog/aps.htm> 

“U.S. Asks Russia to Crack Down on CD Piracy,” RFE/RL Crime and Corruption Watch, 2, no. 

28 (8 August 2002). <http://www.rferl.org/corruptionwatch> 

U.S. Department of State. Trafficking in Persons Report 2002. 

<http://www.state.gov/g/tip/rls/tiprpt/2002> 

“The U.S. Department of State’s Human Trafficking Report,” RFE/RL Crime and Corruption 

Watch, 2, no. 23 (14 June 2002). <http://www.rferl.org/corruptionwatch> 

U.S. Department of State. Bureau for International Narcotics and Law Enforcement Affairs. 

International Narcotics Control Strategy Report 1996. 

<http://www.state.gov.g/inl/rls/nrcrpt/1996> 

U.S. Department of State. Bureau for International Narcotics and Law Enforcement Affairs. 

International Narcotics Control Strategy Report 2001. http://www.state.gov/g/inl/rls/nrcrpt/2001

U.S. Department of State. International Information Programs. “Hungary, Israel Removed from 

Money Laundering Blacklist,” report of 21 June 2002. 

<http://usinfo.state.gov.topical/econ/mlc/02062101.htm> 

“Ukrainian, Polish Border Chiefs Discuss Illegal Migration, Border Checkpoints,” Ukrainian 

television report [Kiev], 12 July 2002 (FBIS Document CEP20020713000058). 

United Nations. Economic Commission for Europe. “Moldova: Anti-Trafficking Policies.” 

<http://www.unece.org> 

United Nations. Office for Drug Control and Crime Prevention. “The Case of Poland,” 1 October 

2002. <http://www.undcp.org> 

University of Exeter. Department of Politics. “Organised Crime in Estonia.” 

http://www.ex.ac.uk/politics

University of Exeter, Department of Politics. “Organised Crime in Russia.” 

<http://www.ex.ac.uk/politics> 

“Up to Code,” The Warsaw Voice, no. 21 (2002). <http://www.thepolishvoice.pl> 
Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

- 218 -

Volkhonsky, Boris. “Moldovan President Offers Dniester Region Compromise, but Europe 

Pushes Him Toward Tough Stance,” Kommersant [Moscow], 6 February 2002 (FBIS Document 

CEP20020206000176). 

Voss, Michael. “’Slave Trade’ Thrives in Bosnia: High Unemployment Makes Women Easy 

Prey,” University of Rhode Island Trafficking in Women from Ukraine Research Project, 8 

March 2001. <http://www.uri.edu/artsci/wms/hughes/ukraine/slavebosnia> 

Weir, Fred. “Baltics Step from Russia’s Shadow into Western Club,” The Christian Science 

Monitor, 20 November 2002, 13. 

Williams, Phil. “Drugs and Guns,” Bulletin of the Atomic Scientists, 55, no. 1 (January-February 

1999). <http://www.bullatomsci.org> 

Wrase, Michael, and Waltraud Kasener. “Belgium Smuggled Weapons to Iraq,” Welt am 

Sonntag [Hamburg], 27 October 2002 (FBIS Document EUP20021027000097). 

Yarmish, A.N. Organized Criminal Groups in Ukraine: Traditional and Typical. Kharkov: 

National University of Internal Affairs, 2002. 

“Yugoslav Arms-Export Scandal Grows,” Radio Free Europe/Radio Liberty Newsline, 6, no. 

207, part II (1 November 2002). 

Zalisko, Walter. “Russian Organized Crime: The Foundation for Trafficking.” 

http://www.monmouth.com/~wplz/Index1

South Asia 

“Advani's Security Beefed Up,” The Times of India [Mumbai], 13 February 2002. 

<http://timesofindia.indiatimes.com/cms.dll/xml/uncomp/articleshow?msid=882143>

Armentrout, Debra. “Child Trafficking Continues to Threaten Young Women in India,” Digital 

Freedom Network report, 15 November 2002. http://www.dfn.org/news/india/trafficked.htm

“The Arms Race in Bangladesh: Issues and Challenges,” The Daily Star [Dacca], 29 July 2001. 

<http://www.dailystarnews.com/law/200107/05/right.htm> 

Bhattacharya, Saurabh. “Sex Workers See Freedom in Rules and Regulations,” Inter Press 

Service report, 15 December 1997. <http://www.oneworld.org/ips2/dec/india3.html> 

“... But What About Remote-Control Operations?” The Times of India [Mumbai], 27 March 

2000. 

Chalk, Peter. “Light Arms Trading in SE Asia,” Jane’s Intelligence Review, 1 March 2001. 
Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

- 219 -

Chandran, Suba. “Drug Trafficking and the Security of the State: Case Study of Pakistan,” 

Institute for Defence Studies and Analyses [New Delhi] report, 1997. <http://www.idsaindia.org/an-sep8-7.html> 

Charles, Molly. “The Drug Scene in India,” presentation to Drug Abuse: A Symposium on 

Social Processes, Narcotics and the State, Mumbai, August 2001. <http://www.indiaseminar.com/2001/504/504%20molly%20charles.htm> 

Charles, Molly. “The Growth and Activities of Organised Crime in Bombay,” International 

Social Science Journal, 53 (2001). 

Chossudovsky, Michael. “The Role of Pakistan’s Military Intelligence (ISI) in the September 11 

Attacks.” <http://globalresearch.ca/articles/CHO111A.html> 

“Crime and Migration: The Body Trade,” Far Eastern Economic Review, 26 October 2000. 

“Daily Details Bangladesh as Transit Point for Arms Smuggling,” Dainik Janakantha [Dacca], 

16 July, 2000 (FBIS Document SAP20000722000010). 

Development Resource Center [Mumbai]. “Grassroot Merchants of Illicit Goods in Gujarat,” 

presentation to Drug Abuse: A Symposium on Social Processes, Narcotics and the State,” 

Mumbai, August 2001. <http://www.india-seminar.com/2001/504/504%20drc.htm> 

Fanney, Rob. “Bangladesh: Harakat-ul-Jihad-ul-Islami,” Jane’s World Insurgency and Terrorism 

16 (14 November 2002). 

Federation of American Scientists. Intelligence Resource Program. “Sikh Terrorists,” 8 August 

1998. <http://www.fas.org/irp/world/para/sikh.htm> 

Ganguly, Dia. “Justice and Force in Bangladesh,” World Press Review, 12 December 2002. 

<www.worldpress.org/Asia/861.cfm> 

Ghosh, Nirmal. “LTTE’s Global Shadow Economy Behind Violence,” The Straits Times, 24 

May, 2000. 

Human Rights Watch. “World Report 2001.” <http://www.hrw.org/wr2k1/> 

Human Rights Watch. “World Report 2002.” <http://www.hrw.org/wr2k2> 

Human Rights Watch. “World Report 2003.” <http://www.hrw.org/wr2k3> 

Hussain, Neila. “Proliferation of Arms and Politics in South Asia: The Case of Bangladesh,” 

Regional Centre for Strategic Studies [Colombo], Policy Studies, 7 (May 1999). 

<http://www.rcss.org/policy_studies/ps_7_1.html> 
Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

- 220 -

Hyder, Tariq Osman. “Kashmir: Self-Determination Versus State Terrorism,” The Korean 

Journal of Defense Analysis, 14, no. 1 (Spring 2002). 

“India 2002-2003,” Jane’s World Armies, 8 April 2002. 

International Action Network on Small Arms. “Pakistan Begins Major Campaign to Seize Illegal 

Weapons,” 30 May 2001. <http://www.iansa.org/news/2001/may_01/pak_beg.htm> 

International Labour Organization, “Nepal: Trafficking in Girls with Special Reference to 

Prostitution: A Rapid Assessment,” November 2001. 

<http://www.ilo.org/public/english/standards/ipec/simpoc/nepal/ra/trafficking.pdf> 

Iqbal, Nadim. “Drug Abuse Grows on Bumper Poppy Crop in Afghanistan,” Inter Press Service 

report, 15 January 2003. <http://www.aegis.com/news/ips/2003/IP30107.htm> 

Jaleel, Muzamil. “India’s Demands,” The Observer, 13 January 2002. 

<www.observer.co.uk/international/story/0,6903,632110,00.html> 

Jaleel, Muzamil. “Kashmiris Tell Indians to Go,” The Observer [London], 13 January 2002. 

Jasparro, Christopher, “Transnational Pressures Destabilize India’s Northeast,” Jane’s 

Intelligence Review, 12 November 2002. 

Johnson, Larry. “The Future of Terrorism,” American Behavioral Scientist, 44, no. 3 (February 

2001): 894-914. 

Kalliangopoulos, F., and N. Tsoutsias, “Greek Deputy Links Tycoon Kokkalis to Stazi, Tamil 

Tigers,” Kathimerini [Athens], 18 April 2002 (FBIS Document GMP200204020000193). 

Kumar, Dhruba. “Impact of Terrorism on Democratic Development in South Asia,” Conference 

on Terrorism in South Asia: Impact on Development and Democratic Process, 23-25 November 

2002, Nepal. 

Kumar, Neeraj. “Organized Crime,” PoliceSpeak, November 1999. <www.indiaseminar.com/1999/483.htm> 

Lancaster, John. “Reshaping Pakistan along Religious Lines,” Washington Post, 20 June 2003, 

A1. 

Lancaster, John, and Kamran Khan. “Extremist Groups Renew Activity in Pakistan,” 

Washington Post, 8 February 2003. 

Lintner, Bertil “A Cocoon of Terror,” Far Eastern Economic Review, 4 April, 2002. 

“LTTE’s Drug Trafficking Links,” Daily Reports from Reality of Sri Lanka, 15 March 2000. 

<www.realityofsrilanka.com/d153Mar00.htm> 
Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

- 221 -

“Mandrax,” Electronic Doctor [South Africa]. <http://www.edoc.co.za/drughelp/mandrax> 

Mazari, Shireen. “India’s Unconventional War Strategy,” Defense Journal, January 1999. 

<www.defencejournal.com/jan99/rawfacts.htm> 

McCarthy, Rory. “Militant Factions Consider Ceasefire,” Guardian Unlimited, 8 June 2002. 

<www.guardian.co.uk/pakistan/story/> 

Meo, Nick. “All Eyes on India’s Most Wanted,” The Sunday Herald [Glasgow], 27 January 

2002. <http://www.sundayherald.com/print21831> 

Naylor, R.T. “Bin Laden, Crime and Opportunism,” 3 November 2001. 

<http://www.yorku.ca/nathanson/Publications/Bin%20Laden.htm> 

“Pakistan,” Jane’s World Armies, 12 (17 June 2002). 

Peiris, G. H. “Secessionist War and Terrorism in Sri Lanka: Transnational Impulses,” 

International Centre for Ethnic Studies,” no. 3, April 2002. 

Rahman, Maseeh. “Facing into a Storm,” Far Eastern Economic Review, 11 October 2001. 

Raman, B. “India: Omens from Katunayake,” Businessline, 27 July, 2001. 

Rashid, Ahmed. “America’s War on Terror Goes Awry in Pakistan,” Yale Global, 4 June 2003. 

Rashid, Ahmed. “The Danger Within,” Far Eastern Economic Review, 30 May 2002. 

Rashid, Ahmed, and Joanna Slater. “Threats and Consequences,” Far Eastern Economic Review, 

6 June 2002. 

Rehman, Jalilur. “Outlawed Islamic Militant Party Challenges Musharraf’s Ban,” Agence 

France-Presse, 26 January 2003. 

Reid, Gary. “Revisiting The Hidden Epidemic,” The Centre for Harm Reduction, 2000. 

<http://www.ahrn.net/rapidassessment.pdf> 

Sahadevan, P. , “Coping with Disorder: Strategies to End Internal Wars in South Asia,” Regional 

Centre for Strategic Policy Studies, 17, no. 5 (November 2000). 

Sen, Ashish Kumar. “India Plots Against Pakistan,” Deccan Chronicle, 28 January 2000. 

Slater, Joanna. “From Riots to Recrimination,” Far Eastern Economic Review, 14 March 2002. 

“South Asia, Internal Affairs,” Jane’s Sentinel Security Assessment, 15 May 2003. 
Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

- 222 -

“State Supported Sectarianism and Terror,” Jane’s Sentinel Security Assessment-South Asia, 10 

(3 September 2002). 

Subramanian, Nurupama. “Delhi-Chennai-Colombo-Narcotics Racket Flourishes,” Indian 

Express, 2 November, 1999. <www.indianexpress.comie/daily/19991102/ige02045.html> 

Transparency International. Corruption Perceptions Index 2002. 

<http://www.transparency.org/cpi/2002/cpi2002.en.htm> 

U.S. Department of State. Patterns of Global Terrorism 2001.

<http://www.state.gov/s/ct/rls/pgtrpt/2001> 

U.S. Department of State. Patterns of Global Terrorism 2002. 

<http://www.state.gov/s/ct/rls/pgtrpt/2002> 

U.S. Department of State. Bureau for International Narcotics and Law Enforcement Affairs. 

International Narcotics Control Strategy Report 2002. 

http://www.state.gov/g/inl/rls/nrcrpt/2002

U.S. Department of State. Bureau for International Narcotics and Law Enforcement Affairs. 

International Narcotics Control Strategy Report 2003. Washington, D.C.: 2003. 

U.S. Drug Enforcement Administration. “India Country Brief,” May 2002. 

<http://www.usdoj.gov/dea/pubs/intel/02022/02022p.html> 

“United Liberation Front of Assam (ULFA),” Jane’s World Insurgency and Terrorism 16 (7 

March 2003). 

Weerakoon, Gamini. “Illicit Trafficking of Small Arms and Terrorism.” Paper presented at 

United Nations Conference on Disarmament, Akita, Japan, August 22-25, 2000. 

Woollacott, Martin. “For Musharraf, Being Decisive Is Not an Option,” Guardian Unlimited, 31 

May 2002. 

Southeast Asia 

Abdullah, Mustafa. “Analysis of Current Situation on Illicit Drug Trafficking,” UNAFEI 

Resource Material Series 58 [Tokyo], December 2001. <www.unafei.co.jp> 

“All It Takes Now Is Commitment,” Bangkok Post [Bangkok], 14 April 1999 (FBIS Document 

SEP19990414000037). 

Arquiza, Rey. “Tamil Guerrilas in Philippines Engage in Raising Funds for War in Sri Lanka,” 

The Philippine Star [Philippines], 16 August 2000 (FBIS Document SEP20000816000040). 
Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

- 223 -

“Asia: A Surfeit of Pills in Thailand,” Economist [London], 28 April 2001, 42. 

“Australia Facing Challenges in Taking Regional Anti-Terrorism Lead,” Strategic Forecasting, 4 

October 2002. <http://www.stratfor.biz> 

“Australia, Malaysia Agree to Cooperate Against People-Smuggling, Drugs,” Radio Australia 

[Melbourne], 2 November 2001 (FBIS Document SEP20011102000076). 

“Australian Ministers Says Malaysia Transit Point for People Smugglers,” Radio Australia 

[Melbourne], 12 July 2000 (FBIS Document SEP20000712000097). 

Bai-ngern, Chaiyakorn. “Thai Police Investigate Three Alien-Smuggling Gangs,” Nation 

[Thailand], 9 June 1999 (FBIS Document FTS19990608002032). 

Bai-ngern, Pongsak, and Piyanart Srivalo. “Thailand: Authorities Uncover Money Laundering 

Ring with Over 40 Companies,” Nation [Bangkok], 9 November 2001 (FBIS Document 

FTS20011109000012). 

“Bali Bombing Forcing Jakarta to Ease Focus on Aceh Rebels,” Strategic Forecasting, 12 

November 2002. <www.stratfor.biz> 

“Bali Bombing: Rift Emerges Within Jemaah Islamiyah,” ICG News Media Release, 11 

December 2002. <http://www.intl-crisis-group.org> 

Bonner, Raymond. “Qaeda Meeting in Thailand Reportedly Plotted Attacks on Tourists,” New 

York Times, 8 November 2002, sec. A, 10. 

Bonner, Raymond. “Southeast Asia Remains Fertile for Al Qaeda,” Washington Post, 28 

October 2002, sec A, 1. 

Burton, Paul. “Behind the Bali Bombing,” Jane’s Sentinel Online, 16 October 2002. 

<http://www.janes.com> 

Cahill, Laurena. “Thai Border Customs Officials Adopt Measures to Prevent Money 

Laundering,” Nation [Bangkok], 21 March 2001 (FBIS Document SEP20010321000011). 

Calica, Aurea. “Analysts Say Philippines’ Anti-Money Laundering Law ‘Lacks Teeth,’” 

Philippine Star [Manila], 1 October 2002 (FBIS Document SEP20011001000034). 

“CCC Study Names 5 Most Corrupt Thai Government Agencies,” Nation [Bangkok], 16 August 

1999 (FBIS Document FTS19990816000169). 

Chaiviwan, Suthep. “Gun Running: Transit to Terror,” Bangkok Post [Bangkok], 14 July 2002 

(FBIS Document SEP20020714000011). 
Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

- 224 -

Charles, Lourdes. “Thailand Links Drug Money to Terrorism Funding, Disagrees,” Star [Kuala 

Lumpur], 18 May 2002 (FBIS Document SEP20020518000005). 

Charoenpo, Anucha. “European Union Seeks to Set Up Bangkok Office to Combat Money 

Laundering in Asia,” Bangkok Post [Bangkok], 3 April 2001 (FBIS Document 

SEP20010403000033). 

Charoenpo, Anucha. “Laundering Agency to Expand Its Duties,” Bangkok Post [Bangkok], 31 

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Charoenpo, Anucha. “Terrorists Collecting Cash Here: Money Transferred to al-Qaeda, 

Hezbollah,” Bangkok Post [Bangkok], 10 March 2002. <http:\\www.bangkokpost.co.th> 

Charoenpo, Anucha. “Thai Police Seek Information on Foreign Criminal Gangs” Bangkok Post 

[Bangkok], 5 July 1999 (FBIS Document FTS19990705000177). 

Charoenpo, Anucha. “Wa Army Said Taking Smuggled Cars from Malaysia in Barter Deals with 

Local Help,” Bangkok Post [Bangkok], 24 August 2001 (FBIS Document 

SEP20010824000016). 

“Chinese National of Human Smuggling Syndicate Nabbed in Cebu,” Philippine Star [Manila], 4 

September 2001 (FBIS Document SEP20010904000063). 

Chouvy, Pierre-Arnaud. “Drugs and War Destabilize Thai-Burma Border Region,” Jane’s 

Intelligence Review, 1 April 2002. <http:\\www.janes.com> 

Chouvy, Pierre-Arnaud. “New Drug Trafficking Routes in Southeast Asia,” Jane’s Intelligence 

Review, 1 July 2002. <http:\\www.janes.com> 

Crispin, Shawn. “Drug Tide Strains Ties,” Far Eastern Economic Review, 162, no. 36 (9 

September 1999): 24-27. 

Cueto, Donna. “Marcos Daughter Attempted Funds Transfer—German, RP Gov’ts,” Philippine 

Daily Inquirer [Manila], 5 July 2001 (FBIS Document SEP20010705000032). 

“Cutting Off Cash to the Terrorists,” Bangkok Post [Bangkok], 9 September 2002 (FBIS 

Document SEP20020909000041). 

Danao, Efren, and Aurea Calica. “Crame Was Center of Drug Trade in ’98,” Philippine Star

[Manila], 30 August 2001 (FBIS Document SEP20010830000035). 

Davis, Anthony. “Bangkok as Crime Central: Where International Gangs Are Settling Scores,” 

Asiaweek, 26, no. 40 (13 October 2000). <http:\\www.asiaweek.com> 

Davis, Anthony. “The Complexities of Unrest in Southern Thailand,” Jane’s Intelligence 

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Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

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Davis, Anthony. “Tamil Tigers Continue Procurement,” Jane’s Intelligence Review, 1 May 2002. 

<http:\\www.janes.com> 

Davis, Anthony. “USA Steps Up Support for Thai War on Drugs,” Jane’s Intelligence Review, 1 

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Dawson, Alan. “Al-Qaeda Links Run Deep,” Bangkok Post [Thailand], 29 May 2002 (FBIS 

Document SEP2002529000048). 

De Leon, Eva, and Cecille Suerte Felipe. “4 Chinese Arrested in Biggest Drug Bust,” Philippine 

Star [Manila], 7 November 1999 (FBIS Document FTS19991107000004). 

De Ruyver, Brice, and Koen Van Heddegem. “Human Trafficking Between Belgium and the 

Philippines,” Tijdschrift voor Criminologie [Amsterdam], 10 January 2001 (FBIS Document 

EUP20020823000403). 

Desker, Barry. “Islam and Society in Southeast Asia after 9-11,” Institute of Defense and 

Strategic Studies, September 2002. 

Dinan, Kinsey Alden. “Trafficking in Women from Thailand to Japan,” Harvard Asia Quarterly,

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Doronila, Amando. “The Senate—the Nation’s Laundry Machine,” Philippine Daily Inquirer

[Philippines], 24 August 2001 (FBIS Document SEP20010824000031). 

Echeminada, Perseus. “Lina: RP-China Anti-Crime Cooperation in the Works,” Philippine Star

[Manila], 25 December 2001 (FBIS Document SEP20011225000035). 

Emmanuel, Tony. “Malaysia Used as Transit Point for Smuggling Human Cargo,” New Straits 

Times [Kuala Lumpur], 28 February 2000 (FBIS Document SEP20000301000075). 

“EU to Target Philippines, Nauru in Money-Laundering Crackdown,” Agence France-Presse

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Garoupa, Nuno. “The Economics of Organized Crime and Optimal Law Enforcement,” Western 

Economic Association International, 38, no.2 (April 2000): 278-288. 

Gershman, John. “Is Southeast Asia the Second Front?” Foreign Affairs, 81, no.4 (July/August 

2002): 60-75. 

Gunarant, Rohan. “The Singapore Connection,” Jane’s Intelligence Review, 1 March 2002. 

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Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

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Hem Raj, Ramend. “Current Situation of Illegal Firearms Trafficking and Human (Women, 

Children, and Migrants) Trafficking,” UNAFEI Resource Material Series 58 [Tokyo], December 

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“A Human Rights Report on Trafficking of Persons, Especially Women and Children,” The 

Protection Project, March 2002, 341. 

“Human Trafficking Syndicates’ Scheme in Smuggling Filipinos to Europe Uncovered,” 

Philippine Daily Inquirer [Manila], 27 June 2002 (FBIS Document SEP20020627000090). 

“In the Spotlight: Indonesia’s Free Aceh Movement,” CDI Terrorism Project Report, 10 May 

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“Indonesia: Bali Bombing Forcing Military to Address Militia Dilemma,” Strategic Forecasting, 

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“Indonesia Backgrounder: How the Jemaah Islamiya Terrorist Network Operates,” ICG Asia 

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“Indonesia Plays Increasing Role in Producing, Consuming Designer Drugs,” Radio Australia

[Melbourne], 16 April 2002 (FBIS Document SEP20020416000090). 

“Indonesia’s Final Days?” Jane’s Intelligence Digest, 17 October 2002. <www.janes.com> 

Jadulco, Boyet. “Ping-Lee Drug Link,” Abante [Manila], 4 September 2001 (FBIS Document 

SEP20010904000047). 

Jimenez-David, Rina. “Sex Abuse and Sex Trafficking in Malaysia,” Asia Intelligence Wire: 

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(FBIS Document FTS19991107000013). 

Jinakul, Surath, and Songpol Kaopatumtip. “Towards a Terror-Free Thailand,” Bangkok Post

[Bangkok], 2 June 2002 (FBIS Document SEP20020602000027). 
Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

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Jones, David Martin, and Michael Smith. “Islamists Defeat Asian Way,” World Today, 58, no. 6 

(June 2002): 12-14. 

Jost, Patrick M. “The Hawala Alternative Remittance System and Its Role in Money 

Laundering.” Interpol, January 2000. 

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Kitada, Mikinao. “Money Laundering in Asia: Current Situation and Countermeasures Against 

Money Laundering in Asia,” Law-Asia Conference, 5 October 2001. 

Klaidman, Daniel. “A Good Place to Lie Low,” Newsweek, 139, no.5 (February 2002): 34. 

Lang, Niu. “Thailand Is among the World’s 10 Criminal Dens,” Mangu Shibao [Bangkok], 19 

May 1999 (FBIS Document FTS19990519002227). 

Laohong, King-O. “Foreign Mafias Take Over Rachada Road Areas as Place to Launder Money 

and Carry Out White Slavery and Narcotics Trafficking,” Bangkok Krungthemp Thurakit 

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Lertcharoenchok, Yindee. “Thai Authorities ‘Closing In’ on Golden Triangle Warlord,” Nation

[Bangkok], 12 February 1999 (FBIS Document SEP19990212001814). 

Lertcharoenchok, Yindee. “Thailand Said Fast Becoming Transnational Crime Center,” Nation

[Bangkok], 22 June 1999 (FBIS Document FTS19990621001844). 

Lopez, Leslie. “Asia Terror Probe Focuses on Malaysian—Suspect Who Hosted Hijackers 

Ordered Material Widely Used to Make Bombs,” Asian Wall Street Journal, 25 January 2002. 

Madanir, Rudy, and Christine T. Tjandraningsih. “Indonesia Issues Terror Decree, Arrests 

Muslim Leader,” Kyodo [Tokyo], 19 October 2002 (FBIS Document JPP20021019000087). 

“Major Raid in Manila Yields 57 Kilos of Shabu from China,” Philippine Star [Manila], 27 

December 2001 (FBIS Document SEP20011227000058). 

“Malaysia Denies Being Springboard for Illegal Immigrants Going to Third Nations,” Bernama 

[Kuala Lumpur], 27 February 2002 (FBIS Document SEP20020227000002). 

“Malaysia: Kedah Police Cripple Drug-Trafficking Ring,” Bernama [Kuala Lumpur], 4 August 

2002 (FBIS Document SEP2002085000007). 

“Malaysia’s Former Military Officer Suspected as Leader of Weapons Thieves Group,” New 

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“Malaysia’s Illegal Immigrants 300,000 [sic] to Curb Entry,” Star [Kuala Lumpur], 25 February 

2000 (FBIS Document SEP20000225000043). 
Library of Congress – Federal Research Division Nations Hospitable to Organized Crime & Terrorism 

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“Malaysian Police Nab 110 Indonesian Illegal Immigrants,” Star [Kuala Lumpur], 29 February 

2000 (FBIS Document SEP20000229000050). 

“Malaysian Police Say Islamic Militants ‘May be Hiding on Thai Soil,’” Nation [Bangkok], 22 

September 2001 (FBIS Document SET20010922000003). 

Manggut, Wenseslaus, Edy Budiyarso, and Chandra. “Angry Indonesian Army Chief: Death for 

Soldiers Stealing, Selling Weapons,” Tempo [Jakarta], 25 August 2002 (FBIS Document 

SEP20020905000036). 

Marfil, Martin P. “Philippine Government Employees Warned of Suspension Over Drug Links,” 

Philippine Daily Inquirer [Manila], 7 September 2001 (FBIS Document SEP20010907000026). 

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McBeth, John. “What If He Isn’t Guilty,” Far Eastern Economic Review, 165, no. 44 (November 

2002): 16-20. 

Mejias, Jhay. “Police Hunt Malaysian Based Syndicate,” Pilipino Star Ngayon [Manila], 1 

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“The Military’s Social Safety Net,” Laksamana [Jakarta], 27 June 2002 (FBIS Document 

SEP20020702000010). 

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Murphy, Dan. “US Pushes Southeast Asian States on Islamic Radicals,” Christian Science 

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“Myanmar, Thailand Draw Up Joint Plan to Fight Drugs,” Agence France-Press [Paris], 14 

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Nakashima, Ellen. “Jailed Indonesian Suspect Details Links to Bombings,” Washington Post, 9 

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Paz, Reuven. “Middle East Terrorist Groups Use of Western Front Companies to Finance 

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Pomonti, Jean-Claude. “Evidence of Al-Qa’ida Financial Transactions in Southeast Asia 

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Pomonti, Jean-Claude. “The Terrorist Network Covers All of Southeast Asia,” Le Monde [Paris], 

20 December 2002 (FBIS Document EUP20021220000074). 

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Rullan, Mercedes. “Five ‘Big Circle’ Members Arrested, P116-M Shabu Recovered,” Manila 

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Salah, Muhammad. “UK-Based Paper Traces Origins of Jihad Groups, Afghan Fighters,” AlHayah [London], 20 October 2001 (FBIS Document GMP20011022000102). 

Sapsomboon, Somroutai. “Thai Banks Urged to Fight Money Laundering,” Nation [Bangkok], 

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Sarifudin, Amir. “Iraqi, Iranian Illegal Immigrants Detained in Malaysia,” Utusan Malaysia

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Xuanliang, Li. “Article on Terrorist Activities by National Separatists, Illegal Religious Groups 

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“Al-Qaeda Financier Was Former Accountant to Saudi Royals: Lawyer,” Middle East Times

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Armesto, Marie Rose. “Europe’s Terrorist Incubator,” Wall Street Journal, 2 September 2002. 

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Barraclough, Anne. “Monte Carlo, the Russian Mafia and Dirty Money,” The Times of London, 7 

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Cowan, Rosie. “The 78 Criminal Gangs Waging War on Ulster,” The Guardian [London], 23 

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“Europe: A Finger Points,” The Economist, 26 February 2000. 

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Evans, Richard. “Systematic Transnational Crime: Organised Crime and Terrorist Financing in 

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Council on Foreign Relations and Markle Foundation. “FARC, ELN, AUC: Colombia, Rebels.” 

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industrie lourde en Amérique latine. [Criminal Cartels: Cocaine and Heroin, a Heavy Industry in 

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de Morais, Machado, and Andrea Frota. “Money Laundering in Brazil.” Report for School of 

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George Washington University, 2000. 

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Fayt, Carlos. Criminalidad del terrorismo sagrado: El atentado a la embajada de Israel en 

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Korzeniewicz, Roberto P. “The Society and Its Environment.” Chapter 2 in Rex A. Hudson, ed., 

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