Corruption

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Money Laundering

This "Prohibition in the Media" post is not tied to a particular article. If you do a Google News search on "drug money laundering," you'll get a list of over 1,400 articles. These are only the ones that the news outlets still have online -- the global financial system is virtually "awash" in illicitly-generated revenues, much of it from the drug trade. Of course, it has to be that way under prohibition -- because we've made drugs illegal, all the money that people spend on them goes into the criminal underground. That's hundreds of billions of dollars per year -- I've seen estimates ranging from $150 billion (the RAND Corporation) to $400 billion (the UN) -- and it has an enormous increasing effect on violence rates. The local dealer protecting his turf, to the vicious source or transit country cartel trying to intimidate press or the authorities, to the terrorist organization using the relatively easy-to-get proceeds of drug sales to augment its budget and be able to kill more innocent people, these are just a few of the ways that prohibition has made our world a more dangeous place in which to live. I've written about that here before. The main point I'd like to make today is the effect of the flow of the money itself. If a drug lord is able to buy or build a city, for example -- it is said that the skyscrapers making up the Bangkok, Thailand skyline were built with drug money -- that gives him an enormous amount of influence going beyond his original illegal business. When our investigators of possible terrorist activity try to track the flow of that kind of money, that must be made more difficult to pinpoint given the ocean of drug money in which it is immersed. And of course anyone happening to stand in the way of some of the money is a potential weak link for corruption. Does drug money have an effect on how some international aid dollars get spent? Probably. I don't say that because of any particular examples to which I have access. It's just that there's so much drug money, in so many places, that it seems like it must have some such impact here and there. We need to drain the flooded basement before we'll have a chance of being able to clean it up. That first means blocking off the pipes that are spilling into it. Which in the case of drug money means... legalization. We are going to say "legalization" over and over until the point sinks in with people. In the meanwhile, we would be most grateful if readers could bring our attention to any particularly interesting money laundering stories you spot, especially stories that involve some additional harm resulting from it. (We'd also appreciate if you have or know of some relevant images that are in the public domain that we could use on our web site.)
Location: 
United States

Feature: Afghan Opium Crop Hits Record as Violence Increases

Things are not going well in Afghanistan. In a stunning admission that the hundreds of millions of dollars spent trying to eradicate the country's opium crop had accomplished little, the United Nations Office on Drugs and Crime (UNODC) announced Saturday that this year's Afghan opium crop is up a "staggering" 60% over last year and will yield a record 6,100 tons this year, leading to a global surplus in black market heroin.

Opium is the backbone of the Afghan economy, accounting for somewhere between 35% and 50% of gross national product, and Afghan opium is the backbone of the global traffic in narcotics, now accounting for 92% of total illicit global production, according to UNODC.

http://stopthedrugwar.org/files/eradicationteam.jpg
opium eradication team (photo from the Senlis Council report, photo library section)
Meanwhile, US soldiers and NATO forces, who took over operations in the restive south of the country earlier this year, are being killed at a record pace as Taliban and Al Qaeda rebels reinvigorated by profits from the opium trade are taking the battle to the foreigners and the government they prop up. And in a reflection of the increased NATO role, for the first time, NATO casualties are keeping pace with American casualties. In what is turning into the bloodiest year so far for Afghanistan's occupiers, 73 NATO troops and 74 American soldiers have been killed so far. Last year, the second bloodiest since the US invasion nearly five years ago, 99 US and 31 NATO troops were killed in fighting.

"The news is very bad. On the opium front today in some of the provinces of Afghanistan, we face a state of emergency," UNODC head Antonio Maria Costa told a Kabul news conference after presenting results of its crop survey to Afghan President Hamid Karzai. "In the southern provinces, the situation is out of control."

In southern Helmand province, now a hotbed of Taliban activity, cultivation rose by a whopping 162% and accounts for 42% of total Afghan opium cultivation, the UNODC said. Costa told the Kabul news conference that NATO must step up its role in fighting the opium trade, especially in the south, where it is helping to fuel the Taliban insurgency.

"We need much stronger, forceful measures to improve security or otherwise I'm afraid we are going to face a dramatic situation of failed regions, districts and even perhaps even provinces in the near future," Costa said.

But while NATO commanders late this week called urgently for more troops on the ground in the south, they have little interest in fighting the drug war. NATO's official position is that its mandate is for stability and peace-keeping, not counternarcotics.

Still, there is pressure from the Americans and the British to try to wage both the war on terror and the war on drugs simultaneously. The top American anti-drug official in Afghanistan, Doug Wankel, told the press conference the need was urgent. "This country could be taken down by this whole drugs problem," he told reporters. "We have seen what can come from Afghanistan, if you go back to 9/11. Obviously the US does not want to see that again."

But analysts consulted by Drug War Chronicle warned that attempting to quash the opium economy and fight the Taliban at the same time is a recipe for disaster. "Paradoxically, the more they go after opium production, the more they strengthen the bond between the Taliban and the population and the traffickers," said Vanda Felbab-Brown, a research fellow at the Brookings Institution and Harvard University's John F. Kennedy School of Government Affairs. "It is a difficult conundrum. There can be no fundamental progress on either the narcotics problem or stabilization in general unless we deal with the insurgency," she told the Chronicle.

"The Taliban have now once again become integrated into production in the south," Felbab-Brown explained. "After 2001, they were pretty much forced out of the drug trade because they were fleeing and because the US and coalition forces were not going after drug trafficking. But now, the traffickers need someone to protect them, to scare off the eradication teams and the state presence, and the Taliban is providing this protection. It is also exploiting the eradication effort," the expert on illicit drugs and military conflict said. "They are handing out leaflets saying things like 'We are the Taliban. Isn't it awful that Karzai under the pressure of the foreign infidels is trying to destroy our crops. Here's our cell phone number. Give us a call.' So now, the Taliban is not only profiting financially, it is also gaining the allegiance of the population by providing protection."

"Things are a bit out of control because so many things happening in Iraq and the Middle East keep the superpowers' eyes off of Afghanistan, so the intruders have more opportunities to accelerate their destruction and illegal activities," said Raheem Yaseer, assistant director of the Center for Afghanistan Studies at the University of Nebraska-Omaha. "At the same time, the coalition and the Karzai government are too busy fighting the Taliban and Al Qaeda to concentrate on eradication," he told the Chronicle.

"The Taliban is moving into the areas where there is drug cultivation, and they receive support from farmers who have had their crops destroyed or threatened," Yaseer continued. "Thus, the traffickers and growers have a bit more freedom than usual. That's why business is booming for the drug dealers. There are too many fronts to deal with, and eradication is just one front."

Solutions are hard to come by. "Nobody knows what the answer is," Yaseer conceded. "Out of those billions of dollars they are spending, they need to use some to compensate farmers and create other jobs and projects. People in the provinces are unemployed and hungry, and the terrorists offer them money to join them. People turn to the Taliban and the terrorists and the drug dealers because that's where the money is. The government and the coalition cannot compete with the money drug dealers offer. It doesn't help that there is such nepotism and involvement of high level officials in the trade. That only makes it all the more difficult to enforce the drug laws. Many government officials are supporting the trade, not fighting it."

http://stopthedrugwar.org/files/opium-smaller.jpg
the opium trader's wares (photo by Chronicle editor Phil Smith during September 2005 visit to Afghanistan)
"There is no doubt lots of government officials are complicit in the trade, but focusing on individuals is a mistake," noted Felbab-Brown. "This isn't about individuals, but about deep structural factors like the lack of stability, security, and economic development. Whoever is in power, whether honest or corrupt, will have to contend with these issues. The honest ones will confront the fact that there is nothing but poppy-growing for much of the population. The only way they can do eradication now is at gunpoint, and that is not the way to carry out a legitimate, widely-embraced policy. Forced eradication generates instability and opposition from the people, and ambitious politicians in the south will link up with the Taliban."

For Felbab-Brown, it comes down to doing counterinsurgency right. "It is critical to increase the number of forces, to increase the troop presence and the delivery of aid," she said. "It's difficult to deliver aid during an active insurgency, but it is vital. But we also need patience, especially on the narcotics issue. The big pressure for premature eradication coming from Washington and international organizations needs to be resisted. We need more money, more troops, more development. Is this international community willing to provide these resources?"

Being patient with the opium economy is getting closer to the correct approach, said Ted Galen Carpenter, a foreign affairs and drug policy analyst with the libertarian leaning Cato Institute. "The only solution is one that no one in any position of influence in Washington or the NATO capitals will consider -- drug legalization," he told Drug War Chronicle. "That would take the black market profits out of the drug trade. It is the ultimate solution. If they won't consider legalization, the very least they can do is look the other way with regard to the drug trade. That worked in Peru in the 1980s, when the Peruvian generals figured out that leaving the coca crop alone dried up support for the Shining Path. Something similar needs to occur in Afghanistan, whether they admit it or not. If they are serious about preventing a further rebound of the Taliban and Al Qaeda, they need to lay off the drug war."

Trying to wage both the war on terror and the war on drugs undermines US policy in the country, Carpenter argued. "There is a fundamental inconsistency in the US nation-building strategy in Afghanistan. The primary goal remains to undermine the Taliban and Al Qaeda, but the problem is if they go after the drug trade, they alienate a major portion of the population and strengthen support for the Taliban. Even trying to prosecute the war on drugs there undermines the primary US goal in Afghanistan."

One European defense and development group, the Senlis Council, has proposed for nearly a year now that the Afghan opium crop be licensed, legalized, and diverted to the legitimate medicinal market. Senlis was harshly critical of Western policy this week.

"Huge amounts of money have been spent on large and costly military operations, but after five years southern Afghanistan is once more a battlefield for the control of the country," said Senlis executive director Emmanuel Reinert as he announced the publication of a new report on the rebirth of the Taliban. "At the same time Afghans are starving. The US has lost control in Afghanistan and has in many ways undercut the new democracy in Afghanistan. I think we can call that a failure, and one with dire consequences which should concern us all. The US policies in Afghanistan have re-created the safe-haven for terrorism that the 2001 invasion aimed to destroy."

But the Senlis licensing proposal is getting little respect or traction and is unlikely to prevail, said Yaseer. "I don't think the Senlis Council proposal will get very far," said Yaseer. "There is all kinds of opposition to any legalization. The religious groups will not support it, the legislators will not support it. There are also serious questions about whether it would just open up more venues for growing and trafficking."

Questions, questions. There are lots of questions in Afghanistan, but few good answers.

Attention Night Owls: Your Editor Will Be on the Radio Sunday Night

Chronicle editor Phil Smith (that's me) will be the guest on Kootenay Co-op Radio's "Fane of the Cosmos" program Sunday night. Based in Nelson, BC, Kootenay Co-op Radio is the independent voice of the Kootenay counterculture. "Fane of the Cosmos" is hosted by local attorney Dustin Cantwell, who is perhaps better known as one of the owners of the Holy Smoke Culture Shop in Nelson, which was raided over alleged marijuana sales earlier this summer. Cantwell will interview me about Afghanistan and the latest atrocities from the American war on drugs (the Canadians really love that stuff), while I will interview Cantwell about the latest on the Holy Smoke situation. The program airs at 10pm Pacific time, 1am on the East Coast and is available over the internet.
Location: 
Nelson, BC
Canada

Beheadings a Sign of Mexico Turf War: Bloody Scene in Once Tranquil State Underscores Growing Violence

Location: 
MIC
Mexico
Publication/Source: 
Houston Chronicle
URL: 
http://www.chron.com/disp/story.mpl/front/4168805.html

Law Enforcement: This Week's Corrupt Cops Stories

The temptations of the border tarnish another Texas lawman's badge, a Tulsa cop is convicted of being too helpful to a drug dealer, and a pair of Newark's finest plea to a pill-pushing scheme. Let's get to it:

In McAllen, Texas, the US Attorney's Office for the Southern District of Texas issued a press release announcing the August 29 indictment of a former South Texas police officer for allegedly taking a bribe to protect what he thought was a cocaine shipment. Former Elsa City Police Officer Herman Carr, 45, is accused of taking a $5,000 payment from an undercover FBI agent to use his position as a law enforcement officer to protect a vehicle he was told contained five kilos of cocaine. He is charged with bribery and faces up to 20 years in federal prison.

In Tulsa, Oklahoma, a federal jury last Friday found a former Tulsa police officer guilty of conspiracy, obstruction of justice, and providing unlawful notice of a search warrant. Former Officer Rico Yarbrough was convicted of informing a suspected drug dealer that a search warrant was about to be served at his residence, the Tulsa World reported. In February, Yarbrough called a Tulsa man and asked him to inform the suspected dealer of the impending raid. Unfortunately for Yarbrough, the conversation was being recorded. Federal investigators who had wiretapped the suspected dealer's phone overheard references to Yarbrough, then fed him information to see if he would leak it. He did. Yarbrough was found not guilty on two related counts, but still faces significant prison time when sentenced November 29.

In Newark, two Newark police officers pleaded guilty in federal court Tuesday to charges they bought thousands of Oxycontin pills from a doctor and resold them, the Associated Press reported. Patrolmen John Hernandez and Ronald Pomponio face up to 20 years in prison and $1 million in fines when sentenced in December for conspiracy to distribute oxycodone, the active ingredient in Oxycontin. The pair admitted in court that Hernandez purchased Oxycontin tablets valued at hundreds of thousands of dollars, while Pomponio took prescriptions for the pills to pharmacies across the state. The doctor from whom they allegedly purchased the drugs has pleaded not guilty.

Calling in the Drug Calvary

Location: 
Afghanistan
Publication/Source: 
Los Angeles Times
URL: 
http://www.latimes.com/news/nationworld/world/la-fg-colafghan6sep06,1,4418859.story?coll=la-headlines-world&ctrack=1&cset=true

Five years after their removal from power: The Taliban are back

SENLIS COUNCIL NEWS RELEASE
5 SEPTEMBER 2006



Five years after their removal from power: The Taliban are back

Taliban Frontline now cuts half-way through Afghanistan

US and UK led failed counter-narcotics policies are responsible

Humanitarian crisis hits southern Afghanistan - extreme poverty, drought and hundreds of thousands starving in south

LONDON – The Taliban have regained control over the southern half of Afghanistan and their frontline is advancing daily, warned The Senlis Council on the release of an evaluation report of the reconstruction of Afghanistan marking the five year anniversary of 9/11. The Report is based on extensive field research in the critical provinces of Helmand, Kandahar, Herat and Nangarhar.

The Taliban frontline now cuts half-way through the country, encompassing all of the southern provinces. Senlis Afghanistan reports that five years after the 2001 US-led invasion, a humanitarian crisis of starvation and poverty has gripped the south of the country and that the US and UK-led failed counter-narcotics and military policies are responsible. The subsequent rising levels of extreme poverty have created increasing support for the Taliban, who have responded to the needs of the local population.

Taliban’s return to power is a direct consequence of the flawed approach that the US-led international community has taken in Afghanistan since 2001
“When you first came here we were so glad to see you. Now we have lived with you in our country for five years and we see you tell a lot of lies and make a lot of false promises,” says a former Mujaheedin commander from Kandahar quoted in the Report.

The US-led nation-building efforts have failed because of ineffective and inflammatory military and counter narcotics policies. At the same time there has been a dramatic under-funding of aid and development programs.

“Huge amounts of money have been spent on large and costly military operations, but after five years southern Afghanistan is once more a battlefield for the control of the country,” said Emmanuel Reinert, Executive Director of The Senlis Council. “At the same time Afghans are starving. The US has lost control in Afghanistan and has in many ways undercut the new democracy in Afghanistan. I think we can call that a failure, and one with dire consequences which should concern us all. The US policies in Afghanistan have re-created the safe-haven for terrorism that the 2001 invasion aimed to destroy.”

Emergency Food Aid needed now: “Children are dying here”

Due to lack of funding from the international community the Afghan Government and the United Nation’s World Food Programme are unable to address Afghanistan’s hunger crisis. Despite appeals for aid funds, the US-led international community has continued to direct the majority of aid funds towards military and security operations.

“The United Nations World Food Programme has been forced to cancel plans to provide more than 2.5 million Afghans with urgent food aid,” said Reinert. “Unless these needs are met, this will have dire consequences for millions of Afghans.”

Hunger and the insurgency: Hunger Leads to Anger

“Five years after 9/11, Afghanistan is still one of the poorest countries in the world and there is a hunger crisis in the fragile Southern part of the country,” said Reinert. “Remarkably this vital fact seems to have been overlooked in funding and prioritisation of the foreign policy, military, counter narcotics and reconstruction plans.

Relieving poverty, which should have been the main priority, has not received the attention it so desperately needed. Consequently the international community has lost the battle for the hearts and mind of the Afghan people.

The Report reveals that makeshift, unregistered refugee camps of starving children, civilians displaced by counter narcotics eradication and bombing campaigns can be found on the doorstep of new US and UK multi million dollar military camps.

“I took my child to the graveyard, my child died of hunger. There are children dying here,” said a man in one of these camps in Kandahar Province.

“Hunger leads to anger,” said Reinert. “Farmers who have had their poppy crop eradicated by the US and UK led eradication campaign now see their children facing starvation.”

These camps also accommodate families who have left their home due to violence and fighting. Some are there because their homes have been destroyed by coalition forces’ interventions in the ‘war on terror’ and the current heightened counter-insurgency operations.

A man in a camp in Lashkar Gah is quoted in the Report as saying, “After the bombing I moved to Lashkar Gah…I am afraid and terrified.” There have been no official camps established to provide for civilians who left their villages due to US bombing campaigns.

Hunger has led to anger against the rich foreign community the Afghans see in their country. This and the crop eradication policies provide a perfect breeding ground for the Taliban propaganda against the foreign presence in Afghanistan.

US and UK-led failed counter-narcotics policies are responsible for the hunger crisis and the return of the Taliban

By triggering both anger and a hunger crisis in southern Afghanistan, US and UK-led counter-narcotics policies are directly responsible for the breakdown in security and the return of the Taliban.

“Forced poppy crop eradication is an anti-poor policy,” said Reinert. “Poppy cultivation means survival for thousands of Afghans. By destroying entire communities’ livelihoods, without any alternative plan for how the farmers would feed their families, the current eradication programmes are pushing farmers straight back into the arms of the Taliban.”

A worker in Kandahar city is quoted as saying “In the villages, they had their crops destroyed, there is no water, no jobs, nothing to do – isn’t it fair that they go and join the Taliban? Wouldn’t you do the same thing?”

The Wrong priorities since 2001

“Prioritising the ‘war on terror’ over the ‘war on poverty’ has recreated the exact situation it was intended to remove in southern Afghanistan,” said Reinert. “Right from 2001, the US-led international community’s priorities for Afghanistan were not in line with those of the Afghan population. It is a classic military error: they did not properly identify the enemy.”

An Afghan commander in Kandahar province is quoted as saying “The foreigners came here and said they would help the poor people and improve the economic situation, and they only spend money on their military operations. The poor people are poorer now than when the Taliban were the government. We don’t trust them anymore. We would be fools to continue to believe their lies.”

Military expenditure outpaces development and reconstruction spending by 900% - the wrong priority

82.5 billion USD has been spent on military operations in Afghanistan since 2002 compared to just 7.3 billion USD on development.

Focus on poverty relief and development could have created a solid foundation on which to re-build Afghanistan. Instead, the focus on “securing” Afghanistan with aggressive military tactics has led the Afghan population to mistrust the reasons for the large international military presence in their country.

The large numbers of civilian casualties and deaths have also fuelled resentment and mistrust of the international military presence.

“We have a saying about you now: Your blood is blood, our blood is just water to you,” the Report notes a former Mujaheedin commander from Kandahar as saying.

There were 104 civilian casualties in Afghanistan in the month of July alone.

Faced with the return of the Taliban, the US and the international community must immediately reassess entire approach in Afghanistan

“Emergency poverty relief must now be the top priority,” said Reinert. “Only then can we talk of nation-building and reconstruction. A complete overhaul of the failed counter-narcotics strategies is urgently needed. We must try and win back the hearts and minds of the Afghan people. The Taliban are advancing north every day. This should concern us all.”

Research for the Report was carried out throughout Afghanistan in the spring and summer of 2006 by Senlis Afghanistan teams of Afghan and international researchers.
Location: 
Afghanistan

Afghanistan Five Years Later--The Return of the Taliban

Location: 
Afghanistan
Publication/Source: 
Senlis Council
URL: 
http://www.senliscouncil.net/modules/publications/014_publication

In Afghanistan, A Symbol for Change, Then Failure

Location: 
Afghanistan
Publication/Source: 
New York Times
URL: 
http://www.nytimes.com/2006/09/05/world/asia/05afghan.html?hp&ex=1157515200&en=1e70e663189b6fb9&ei=5094&partner=homepage

The Afghanistan Debacle

On Saturday, the UN Office on Drugs and Crime released its estimate of the 2006 Afghan opium crop, and the numbers are astoundingly bad. According to the UNODCO, this year's crop is 60% larger than last year's and will yield an all-time record 6,100 tons of opium. Afghan opium will account for a whopping 92% of global illicit opium production. This report, which must come as a punch in the gut to the US and NATO, strongly suggests that the US/NATO/Karzai strategy of attempting to uproot the opium crop and the opium economy--which is Afghanistan's primary economic motor--is not only failing, it is backfiring. Opium production has now spread to 28 of the country's 34 provinces, and in the restive south, opium profits are helping fuel a resurgent Taliban and Al Qaeda insurgency. It is a situation eerily reminiscent of Peru in the 1980s. Maoist insurgents of the Shining Path were making inroads among Peruvian coca producers, who were being hounded by the Peruvian government at the behest of the United States. Some Peruvian generals got smart and decided to lay off the peasants, ignoring their coca cultivation in a bid to win hearts and minds. The US government got mightily pissed, but in the end, the strategy worked. The Shining Path was not able to bring the coca growers into its insurgency and eventually faded away. There is a lesson here for NATO and American war planners. You can have your war on terror or you can have your war on drugs, but it doesn't seem that you can successfully have both. It's awfully difficult to win hearts and minds when you're burning down farmers' fields and destroying their livelihoods.
Location: 
Afghanistan

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