International Drug Trafficking Number of Term Paper

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The global cocaine seizures in 2002 indicate a 10% fall from 1999 -- the latest peak year for cocaine production. Although the bulk of cocaine seizures in 2002 continued to be in the Americas (55%in South America; 32% in North America), the most disturbing trend is the rise in European seizures (13% v. 6% in 1990 and 8% in 2000). The increase in cocaine trafficking to Europe is mainly due to the saturated and relatively high-risk market of North America and the relatively higher profits available in Europe. The declining trend in cocaine traffic to North America is attributed to effective eradication programs in the source countries and stricter crack-down by the drug enforcers on the cocaine market in the U.S.

Most of the worldwide cocaine traffic is managed by deeply entrenched criminal groups / drug cartels based in Columbia. These organizations use a sophisticated infrastructure to move cocaine by land, sea, and air into the U.S. And to Europe. They also operate cocaine distribution and drug money laundering networks in the U.S. with a vast infrastructure of multiple cells, each performing specific function within the organization, e.g., transportation, local distribution, or money movement.

Opiates (Heroin, Morphine & Opium)

The Golden Triangle (Thailand, Myanmar, and Laos) and South West Asia (Afghanistan, Pakistan) have been the leading source of opiate products in the last two decades. Worldwide seizures of opiates increased by 9% in 2002 after having fallen almost 21% in the previous year as reported in the UN World Drug Report, 2004. This increase was mainly due to a significant increase in the large-scale cultivation and processing of poppy in Afghanistan. About 10 years ago, the main opium producers were the Golden Triangle countries but these have been overtaken by the South West Asia (mainly Afghanistan) in opium production and trafficking. This reversal has been due to a successful operation against poppy growing and opium / heroin production in the Golden Triangle countries (production has more than halved in Myanmar and Laos as compared to 1990) while the production in Afghanistan has more than doubled in the same period.

The current trend in opiate trafficking is reflected in the increased seizures in South West Asia (Iran, Pakistan, and Afghanistan), which rose by 18% over the previous year. Most of the opiate products grown and processed in Afghanistan are routed either through Iran and Pakistan or through Central Asian countries such as Tajikistan with the Central Asian route being preferred for the traffic of heroin and the Iran / Pakistan route catering for opium and morphine.

The heroin and other opiate products produced in Afghanistan are mostly trafficked to Western Europe where the wholesale and retail trade of heroin is mainly controlled by Turkish / Kurdish and Albanian criminal groups. Trafficking of opiates is far less in the Americas with seizures in 2002 representing 6% of the total global seizures. The bulk of opiates and heroin transported to the United States in recent years originates in Mexico and Columbia with smaller quantities originating in South East Asia (the Golden Triangle) and South West Asia (Afghanistan and Pakistan). Columbian and Mexican drug cartels dominate the distribution and retail trade of heroin in the United States.

Amphetamine Type Stimulants (Methamphetamine, Ecstasy, and Amphetamine)

Global trafficking of synthetic drugs, i.e., Amphetamine type stimulants (ats) has increased at a greater rate than other drugs such as cocaine and heroin. This is reflected in the 10-fold increase in the worldwide ats seizures in the period from 1990 to 2000. Although seizures of ats have declined in 2001 and 2002 (as compared to the peak in 2000) they were still six times higher than in 1990, showing a strong market for such drugs.

Out of the three ats drugs, methamphetamine is the dominant drug by far in terms of production, trafficking and consumption (about 80%), followed by Ecstasy (15%) and amphetamine (5%). Most methamphetamine seizures in 2002 were made in the East and South East Asia (87% of all seizures) and North America (13%). Country-wise, the largest methamphetamine seizures in 2002 occurred in Thailand (57%), China (21%), the U.S.A.

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(7%) and Myanmar (6%). The main source countries for the drug are Myanmar (the major supplier to Thailand), China, and the Philippines for Asia and the United States and Mexico for North America. Trafficking of methamphetamine to Europe is negligible although more than 90% of global amphetamine seizures in 2001/2002 were in Europe. The main source countries for amphetamine are Netherlands, Poland and Belgium.

Trafficking of Ecstasy has shown a clear upward trend in the 1990s. In the early 90s, almost all of Ecstasy seizures were reported from Europe but in recent years the drug has spread globally. In 2002, the bulk of ecstasy seizures occurred in Europe (62%) but were also reported from North America (19%), Oceania (9%) and East/South East Asia (6%). Belgium, Netherlands, the UK, USA, and China are notable among the countries where ecstasy was seized in significant quantities recently. Netherlands is the biggest producer of the drug, but most trafficking of ecstasy from Europe to the U.S. is carried out by Israeli and Dominican criminal groups while Chinese drug traders control in trafficking to China.

Drug Trafficking and Money Laundering

Enormous amounts of money are involved in the international drug trade. One estimate puts this in excess of 400 billion dollars per annum, which is about 8% of all international trade. Such large sums of illicit profits are difficult to spend unless they are 'legitimized' and shown to be derived from apparently legal sources. The methods employed for concealing the real source and destination of illegally derived money is known as 'money laundering' and the practice, understandably, has a strong nexus with drug trafficking.

Drug traffickers employ various methods to launder their profits and keep changing their methods in response to the steps taken by the law enforcing agencies. For example, in the United States there is a law that requires the reporting of any transactions of more than $10,000 to the Financial Crimes Enforcement Network (FinCEN). In order to get around the requirement, drug traffickers often break up large amounts of cash into transactions of less than $10,000. Other laundering schemes in the past have involved routing of drug money through casinos, investing in gems and precious metals, use of wire transfer companies and smuggling of currency to move dirty money off-shore.

Whichever method of money laundering is used, the main objective of all money launderers is to hide the identity of the persons who own the money. This is done by creating "layers" between the persons who actually own the money and the persons who eventually receive it -- both being the same. A typical money laundering procedure consists of placing the drug money in domestic or off-shore financial institutions and then making it go through a host of intermediaries by a complex series of wire transfers, shell companies, bearer shares, and nominees in offshore financial centers. Front companies, false invoicing, the purchase of financial instruments (stocks, bonds, and certificates of deposit), investment in real estate or tourism are other methods used for creating the "layers" and muddying the audit trail.

Almost all countries now have such anti-money laundering laws in place, but the globalization of the world economy and rapid developments in communication technology now allows rapid transfer of funds across international borders with ease, making the task of combating money laundering more difficult. According to the UN Office on Drugs and Crime, estimates of the money laundered globally in a one year period range between $500 billion and $1 trillion.

Conclusion

As we saw in this essay, drug trafficking is an important component of the international drug trade in illegal drugs. It is a multi-billion dollar global activity that involves the linking of the producers of the illicit drugs with the consumers besides generating enormous profits. Because of the illegal nature of the business, most of drug trafficking is carried out by organized criminal gangs and drug cartels, which originate from different countries of the world. Despite the consensus among governments and the public opinion about the desirability of eradicating the menace and concerted efforts by drug enforcing.....

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