Transnational Crime Networks

ISS 814 International Crime

Semester 1,2008-04-08 Assignment 1 Essay:

“It is clear that organised crime is going through a period of rapid and dramatic change. Globalisation is reshaping the underworld just as a combination of evolving law-enforcement strategies and technological and social change is breaking down old forms of organised crime (monolithic and identified as “turf” or ethnic identity), and creating new, flexible networks of criminal entrepreneurs.” (Galeotti 2004, p. 6)

Select one type of transnational crime and discuss Galeottis quotation.

Robert Fiedler

After cold war, new patterns of conflicts emerged, most of them regional or intra - state conflicts (Stohl 2005). In these conflicts small arms were the dominant weapons, often purchased and supplied in an international black market, one that traffics 250 - 300 Millions illegal small arms (Jane's Terrorism & Security Monitor 2006). To fulfil the pretensions of this enormous market, trans-national crime organizations established highly sophisticated purposive networks throughout the globe that became rather successful, being able to "exploit international channels, systems and infrastructure where they already exist and are equally quick to create new ones” (Stohl 2004, p. 21).

Globalization, considered as "processes through which sovereign national states are criss­crossed and undermined by trans-national actors” (Beck 2000, p. 101) has had a tremendous effect on the illicit markets and in special on the illicit small arms trade. In the following this paper will argue, that by creation of international networks in order to exploit international sources and new emerging markets, illicit small arms trade became a global business in the last decades (Stohl 2004, p. 21). It will also analyze how globalization processes contributed to this development by opening up new perspectives for international acting crime groups. A focus will be laid on major sources for illicit arms and the analysis of major causes for the global expansion of illicit trade in small arms during the last 20 years.

While international illegal arms trade became a global market in the last decades the constant demand for weapons throughout the world is satisfied by three major sources. First of these is the diversion of legal weapon stockpiles (Makarenko 2003). Stohl argues that "a vast majority of small arms market were produced and traded legally before being diverted to an illicit network” (Stohl 2004, p. 22).

Globalization proceeds not just on an economic or a technological level, it is also the globalization of ideas which leads to the transformation of former authoritarian states throughout the world and in many cases to the weakening of state authorities. The strength or weakness of a state is strongly interconnected with the development of criminal organizations, the more weak a state becomes the more likely is the spreading of illegal activities (Williams 2002, p. 316). After 1990, through the globalization of ideas, the number of weak states raised dramatically, offering the illicit economies many possibilities worldwide (Naim 2005, S. 27).

An estimated 650.000 to 1 Billion small arms were captured by the looting of national arsenals when Albania collapsed in 1997 (Smith 1999). Important in this and other cases was the disability of state authorities to protect the stockpiles properly either because there simply was no protection or the army forces take part in the looting of stockpiles (Center for Peace and Disarmament Education and Saferworld 2005, p. 13). In the aftermath of the events of 1997 one of the major hubs for trans-national and trans-regional illicit arm trade emerged in Albania. Most of the trafficked weapons were shipped to Kosovo and Macedonia, but a large quantity also found their purchasers in Italy or Greece (Jane's Intelligence Review 2007). Greek arm brokers are reported to sell Albanian weapons to the Workers Party of Kurdistan or Hezbollah in Lebanon (ibid).

A second source of small arms for illegal markets is the "state supplies of weapons to non­state actors” (Makarenko 2003). In South East Asia, one of the major sources for illicit weapons during the 1980s and 1990s was an arms pipeline, set by US government to support afghan fighters in their struggle against the soviet army, providing an estimated 65.000 tons of weaponry (Kartha 1997, p. 73). This pipeline provided a huge range of possibilities to divert weapons into the illegal market "with at least 15 way points and various actors involved in its transport” (ibid.) Only an estimated 30 % of all delivered weapons reached the original destinations (Smith 1995).

Furthermore, in many weak states, state and military officials are involved in the illicit trade with small arms supplying criminal organizations with weapons from national stockpiles. In weak states it is rather simple for criminals to gain control on important governmental authorities or officials a fact that eases the creation of secure areas providing legal immunity for crime groups. While many governments in Southeast Asia face the problem of poorly trained or corrupt officials this region has become one of such secure retreats. The weak law enforcement and the influence of criminals on authorities leave little scope for these countries to control illicit weapons trade within or across their boarders (Bedeski 1998, p. 5). Furthermore, the region is not able to establish effective measures to control and controvert the illegal flow of weapons (ibid).

Thailand became one of the most important hubs in Southeast Asia during the 1990s and was flooded with illegal small arms (Davis 2003). It is believed that high military officers and soldiers are the major actors in the country’s illicit arms trade (Bangkok Post, 2008). The country is more likely to be a trading post, delivering incoming weapons from old stockpiles in Cambodia and Vietnam (Smith, 1999) to crisis regions and combating groups in Myanmar, Sri Lanka, Indonesia or the Philippines (Chalk 2001). The nexus between military officials and the illicit trade of arms enabled international acting groups to establish new trading routes and new business centres in the country.

A similar pattern could be observed in Peru. In the year 2000 Peruvian police disclosed an international acting arms dealers ring, managed and controlled by the chief of Peruvian intelligent agency Vladimiro Montesinos (Austin 2001, p. 12). With support of this high ranked government official, Peru became one of the most important sources for Colombian rebel group FARC and vice versa a the country provided possibilities for the laundering of drug money (ibid).The trade ring supplied Jordanian weapons, officially ordered and purchased on the behalf of Peruvian army (Austin 2001, p13) to FARC (Munoz 2000) including "mercenary Ukrainian aviator working for the Russian drug trafficking mafia, Peruvian army officers” (Lama 2000).This event happened in a time, Peru was eagerly struggling for the process of democratization and therefore, the government under President Fujimori was weakened and "went from accuser to suspect, coming under suspicion at least of being unable to clamp down on corruption among the high military command” (Lama 2000)

To satisfy the huge demand of weapons black markets depend also on the production of new and cheap weapons. China appears to be another major source for new weapons in the illicit markets (Jane's Terrorism and Security Monitor, 2006). China has become one of the worlds' most important arm supplier, considered to be one of the world’s largest producer of small arms (Stockholm International Peace Research Institute 2005, Table 10A.2 exports). With an estimated $100 billion in 2002 (Small Arms Survey 2005, p. 98) the country also holds a leading position as an arms exporter. Chinese weapons are reported to be sold to countries under UN arm embargo, such as Sudan, Myanmar or Iran (Amnesty International 2006, p. 2). Moreover Chinese weapons play a key role for armed non-state groups in many intra-state conflicts. Chadian rebel groups use a large amount of weapons, produced by the Chinese arm manufacturer Norinco It is assumed that these weapons are supplied by the government of Sudan, which is reportedly involved in official arms trades with China (Amnesty International 2006, p. 6). Chinese copies of AK47 are also used in the Great Lakes Region East Africa either supplied direct by the Chinese government or delivered by third countries, like Albania or Zimbabwe (Amnesty International 2006, p. 4).

On the other hand Pakistan became one major source for new weapons, supplying the markets in central Asia, Afghanistan and India (Smith, 1995). Pakistan has a thriving and uncontrolled illegal production of small arms which is mainly based in the Darra Adam Khel. An estimated 3000 companies are producing weapons or part of weapons and therefore this industry is able to produce ca. 20.000 small arms a year (Small Arms Survey 2003, pp. 32­33). Weapons produced in this area are not only cheap, copies of AK47 cost around $50 US. Darra weapon shops offer a free house delivery anywhere, either regional or to international customers such are rebel groups from Northern Ireland to the Middle East (Shinwari 2005, p. 10). In the last decades international acting crime groups involved in the illicit arm trade, established a variety of sophisticated networks to connect these sources with potential customers throughout the globe.

The processes of economic and political globalization enabled these networks to operate on an international level providing a variety of advantages for the participating actors.

“Much more than in the past, criminal organizations are networking and cooperating with one another, enabling them to merge expertise and to broaden the scope of their activities. Rather than treat each other as rivals, many criminal organizations are sharing information, services, resources, and market access according to the principle of comparative advantage. By doing so, they can reduce their risks and costs and are better able to exploit illicit criminal opportunities. Although most cooperation between criminal organizations so far has been largely tactical--such as collaborating in smuggling ventures, arranging illicit financial transactions, or laundering money--the potential for broader alliances to undertake more complex criminal schemes in an increasingly global economy is significant” (United States Government Interagency Working Group. 2000, p. 6).

The nature of networks is that they provide a clandestine environment, impeding the progresses of international law enforcement through the lack of a physical infrastructure and the possible exploiting of different national laws and regulations (Williams 2001, p. 71). Networks are composed as a set of a core and periphery units that enables criminals to expand their activities across national boarders (Williams 2001, pp. 72 - 73) and to access on the specifications of other criminal organizations such as transporting or money laundering. Therefore this network construction provides a range of advantages such are high security levels due to their international and loose structure or the possibility to form purposive alliances, e.g. to step into new markets using existing infrastructures.

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