Federal Law Enforcement

Transnational Organized Crime and National Security

By Eric Halliday
Monday, April 29, 2019, 3:25 PM

Traditional organized crime, ranging from the Italian-American mafia to street gangs, has long been a target of American law enforcement efforts. Unlike purely domestic organized crime, transnational organized crime, defined by the Justice Department as groups that pursue criminal activities across geographic boundaries, has profound national security implications. The FBI warns that transnational organized crime poses a diverse array of national security threats related to border security, government corruption both in the United States and abroad, energy and “strategic material” markets around the world, and “logistical and other support to terrorists and foreign intelligence services.”

This is the first in a new series of posts about developments in Justice Department efforts to combat transnational organized criminal groups. The series will focus on the national security threats posed by transnational organized crime and will summarize how the U.S. government addresses those threats, such as prosecutions, sanctions and developing legislation.

This post will emphasize notable developments in the past few months in the Justice Department’s drive to prosecute transnational organized crime groups. Several cases demonstrate the Justice Department’s strategy of targeting international terrorist organizations by pursuing their criminal conduct. Additionally, a case brought in New Jersey illustrates the continuing threat posed by organized hackers to sensitive information held by the U.S. government. Finally, in the battle to stymy drug trafficking cartels that operate inside the U.S. and along its borders, recent cases demonstrate the ongoing ability of such groups to corrupt anti-trafficking forces in the U.S. and Latin America.

Organized Crime by Established National Security Threats

Hezbollah

The U.S. Attorney’s Office for the Southern District of New York announced on March 8 that Tareck Zaidan El Aissami Maddah, former vice president of Venezuela and current minister of industry and national production, had been charged along with four accomplices with violating the Foreign Narcotics Kingpin Designation Act and sanctions placed by the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC). When issuing the sanctions in February 2017, the Treasury Department declared El Aissami to be a specially designated narcotics trafficker (meaning that his trafficking activities were substantial enough to merit targeted Treasury penalties) and detailed his supervision and partial ownership of multiple narcotics shipments—each weighing over 1,000 kilograms. The indictment describes how El Aissami and his accomplices violated those sanctions, primarily by chartering U.S.-based private jets.

Although the sanctions and indictment do not mention any affiliation with Hezbollah, El Aissami has long been reported to have ties to the terrorist organization and to be their ally within the Venezuelan government. A 2017 CNN investigation reported that South American intelligence agencies pointed to El Aissami as the mastermind behind a plan to deliver hundreds of Venezuelan passports to foreign nationals, including Hezbollah members, and the former intelligence chief of Venezuela described El Aissami’s ongoing ties to Hezbollah in a recent interview with the New York Times. The U.S. government has recognized Hezbollah’s presence in Venezuela, most recently when Secretary of State Mike Pompeo stated that Hezbollah had “active cells” in the country.

In other news pertaining to Hezbollah, Kassim Tajideen pleaded guilty on Dec. 6, 2018, to money laundering in furtherance of violating Treasury Department sanctions. Tajideen, who was sanctioned in 2009 and described in the sanctions announcement as an “important financial contributor” to Hezbollah, was charged in March 2017 after being extradited from Morocco. As part of his plea, Tajideen agreed to forfeit $50 million and serve a sentence of 60 months. His original sentencing date was postponed and the new date has not yet been made public.

The investigation against Tajideen was led by the Justice Department’s Hezbollah Financing and Narcoterrorism Team, which then-Attorney General Jeff Sessions announced in January 2018 as the centerpiece of the department’s effort to target the group’s criminal activities. Sessions also declared Hezbollah to be a leading “transnational organized crime threat” in October 2018 when he announced a Transnational Organized Crime Task Force designed to combat Hezbollah and other organizations.

The Taliban

As Emma Broches and Julia Solomon-Strauss discussed previously on Lawfare, Haji Abdul Satar Abdul Manaf was extradited from Estonia in February 2019 and faces charges of narcotics distribution, narcoterrorism on behalf of the Taliban and attempted narcoterrorism on behalf of the Haqqani Network (an Islamist militant organization operating predominantly along the Afghanistan-Pakistan border). The complaint alleges that Manaf agreed to provide an undercover informant with multiple shipments of heroin, each potentially weighing several hundred kilograms. Manaf allegedly had a substantial heroin trafficking arrangement with the Taliban and attempted to provide drug proceeds to the Haqqani Network. The Taliban is estimated to earn hundreds of millions of dollars in proceeds from the illicit Afghan opium market each year and its narcotic trafficking activities have been a major target for American prosecution in recent years.

The diversity of the charges against El Aissami (OFAC violations), Tajideen (money laundering) and Manaf (narcotics distribution and narcoterrorism) illustrate the different strategies available to the Justice Department when prosecuting the criminal activities of terrorist groups. Especially when proving terrorism cases in open court might jeopardize ongoing investigations or reveal classified intelligence sources, pursuing terrorist organizations through their criminal activities allows the Justice Department to utilize a broad array of simpler but equally effective charges.

Hacking Activities by International Criminal Groups

On Jan. 15, the Securities and Exchange Commission (SEC) and the U.S. Attorney’s Office for the District of New Jersey announced related civil and criminal charges against two Ukrainian hackers and seven accomplices who allegedly illegally obtained and then traded on hacked SEC information. The hackers, Artem Radchenko and Oleksander Ieremenko, penetrated the SEC’s EDGAR system—a database in which companies file financial forms that often contain sensitive, nonpublic earnings results—and then passed that information along to accomplices in Russia, Ukraine and the United States. The accomplices allegedly traded on hacked information concerning at least 157 different earnings announcements, generating $4.13 million in profits for the network from February 2016 through March 2017.

Ieremenko was also charged in 2015 for his role in a similar, nine-person collective, composed of Ukrainian and American nationals, that hacked into newswire services and stole more than 150,000 yet-to-be-published corporate press releases, trading on that information and reaping roughly $30 million in profits. His indictment in the more recent case notes that Ieremenko deployed some of the same techniques against the SEC that he first used in the newswire hack. The similarity in the two schemes, the large profits generated, and the fact that Radchenko and Ieremenko successfully bypassed the SEC’s protections for over a year demonstrate the agency’s vulnerability to hacker collectives attempting to exploit sensitive government and financial data.

Corruption and Destabilization by Narcotrafficking Organizations

The United States

A former Border Patrol agent, Robert Hall, was sentenced on March 8 in the Southern District of Texas to 112 months in prison for accepting bribes from a drug trafficking organization and facilitating the smuggling of drugs across the U.S.-Mexico border. Hall assisted the trafficking organization for 10 years, between 2004 and 2014, providing the locations of unmanned border gates, the keys to locked border gates, and Customs and Border Protection (CBP) radios. In return, he received cash payments of $50,000.

An American member of the trafficking organization who worked with Hall to smuggle the drugs, Daniel Hernandez, pleaded guilty on February 11 to one count of conspiracy to bribe a public official. His sentencing is scheduled for May 9.

Hall is the latest in a string of CBP agents to be arrested for corruption in recent years. Through a Freedom of Information Act request, the Project on Government Oversight found that, through April 2018, 13 CBP agents had been charged with corruption-related crimes since the beginning of the Trump administration. Although this problem is not unique to the current administration, the inspector general for the Department of Homeland Security noted while testifying to Congress in 2017 that “historically, [his office] has seen large increases in allegations of misconduct against [Department of Homeland Security] personnel after rapid hiring surges.” Considering that trend, the Trump administration’s continued emphasis on hiring border security personnel suggests that Hall’s case may not be the last of its kind.

Mexico

In the wake of the conviction of notorious Sinaloa cartel leader Joaquin “El Chapo” Guzman Loera, the Justice Department charged two of his sons, Joaquin Guzman Lopez and Ovidio Guzman Lopez, with the trafficking of cocaine, methamphetamine and marijuana between 2008 and 2018. Both Mexican nationals, Guzman’s sons continue to hold senior leadership roles within the cartel and are expected to influence its direction in the aftermath of their father’s downfall. Although neither is currently in U.S. custody, the existence of these charges allows the Justice Department to pursue the brothers’ extradition in the event of their arrest by Mexican authorities—the same strategy that the Justice Department employed against their father after he first rose to prominence in the mid-1990s.

In a separate case targeting the Sinaloa cartel, Cesar Hernandez-Martinez pleaded guilty in the Southern District of California to overseeing a large money laundering operation that smuggled $13 million in drug proceeds from the United States to Mexico. He is the fourth former Sinaloa cartel member to plead guilty to involvement in the operation and will be sentenced on July 8.

The charges against El Chapo’s sons and Hernandez-Martinez represent the Justice Department’s ongoing efforts to incapacitate the Sinaloa cartel, which Sessions placed alongside Hezbollah on the same list of “top transnational organized crime threat that threaten the safety and prosperity of the United States.”

On Jan. 4, Edgar Veytia, the former attorney general for the Mexican state of Nayarit, pleaded guilty to one count of international conspiracy to manufacture and distribute heroin, cocaine, methamphetamine and marijuana. The indictment stated that he was involved in the trafficking scheme between 2013 and 2017. The AP reported that, ironically, Veytia campaigned on a law and order platform, promising that “[In Nayarit], there is no room for corruption.” He is scheduled to be sentenced on June 6.

Honduras

Several cases involving Honduran narcotraffickers also demonstrate the ability of cartels to corrupt foreign government officials. On Jan. 23, the U.S. Attorney’s Office for the Southern District of New York charged two Hondurans, one a former mayor, with several counts relating to conspiracy to import cocaine into the United States and the use of machine guns and destructive devices in that conspiracy.

The indictment against Amilcar Alexander Ardon Soriano, the former mayor of El Paraíso in Honduras, describes him as a key participant in an international trafficking scheme from 2000 through 2015, collaborating with the Honduran National Police to protect drug shipments and taxing shipments that passed through the territory around El Paraíso that he controlled. The indictment against the other defendant, Mario Jose Calix Hernandez, alleges that he collaborated with drug trafficking organizations in Honduras, Guatemala, Colombia and Mexico to ship multiton loads of cocaine to the United States. Calix Hernandez allegedly provided protection for the shipments alongside members of the Honduran National Police.

The charges against Soriano and Calix Hernandez come in the wake of the arrest and charges of large-scale drug trafficking and bribery against Juan Antonio “Tony” Hernandez Alvarado in November 2018. Hernandez Alvarado is a former member of the Honduran National Congress and the brother of Honduran President Juan Orlando Hernandez. He is alleged to have been a significant mover of cocaine, to the point that he controlled cocaine laboratories in Honduras and Colombia and ordered his cocaine packages to be stamped “TH” for Tony Hernandez.

Finally, Noe Montes-Bobadilla was sentenced in the Eastern District of Virginia to 37 years in federal prison for trafficking thousands of kilograms of cocaine destined for the United States. The indictment against Montes-Bobadilla laid out how he and his associates took part in all aspects of the trafficking process: acting as middlemen and buying multiton shipments of cocaine from South American producers before selling to Mexican cartels, transporting other cocaine shipments and charging a 10 percent tax, and bribing Honduran officials to avoid detection.

The cases against Veytia, Soriano, Calix Hernandez, Hernandez Alvarado and Montes-Bobadilla demonstrate the United States’s ongoing difficulty in partnering with Mexican and Honduran officials to combat narcotrafficking—even as the Trump administration continues to make drug trafficking a top domestic and foreign policy priority.

Historically, both Republican and Democratic administrations have pursued partnerships with Latin American governments to combat narcotic trafficking along the supply chain that runs through Central and South America. That bipartisan strategy is encapsulated by the Mérida Initiative, a U.S.-Latin American cooperation initiative supported by both the Bush and Obama administrations. The corruption found in the cases highlighted here illustrates the challenges in relying on such cooperation, although the Trump administration included funds for the Mérida Initiative in its fiscal 2020 budget request to Congress.