Organized Crime In The New Millennium

The e-Advocate
Monthly
…a Compendium of Works on:
Organized Crime
In The New Millennium
Exodus 20
Proverbs 28:5 | 1 Samuel 8:3 | 2 Samuel 11:2-17
Matthew 2:16 | Mark 14:55-56 | Acts 6:13; 25:7
“Helping Individuals, Organizations & Communities
Achieve Their Full Potential”
Special Edition| ALG – May 2022

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Walk by Faith; Serve with Abandon
Expect to Win!
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The Advocacy Foundation, Inc.
Helping Individuals, Organizations & Communities
Achieve Their Full Potential
Since its founding in 2003, The Advocacy Foundation has become recognized as an effective
provider of support to those who receive our services, having real impact within the communities
we serve. We are currently engaged in community and faith-based collaborative initiatives,
having the overall objective of eradicating all forms of youth violence and correcting injustices
everywhere. In carrying-out these initiatives, we have adopted the evidence-based strategic
framework developed and implemented by the Office of Juvenile Justice & Delinquency
Prevention (OJJDP).
The stated objectives are:
1. Community Mobilization;
2. Social Intervention;
3. Provision of Opportunities;
4. Organizational Change and Development;
5. Suppression [of illegal activities].
Moreover, it is our most fundamental belief that in order to be effective, prevention and
intervention strategies must be Community Specific, Culturally Relevant, Evidence-Based, and
Collaborative. The Violence Prevention and Intervention programming we employ in
implementing this community-enhancing framework include the programs further described
throughout our publications, programs and special projects both domestically and
internationally.
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Dedication
______
Every publication in our many series’ is dedicated to everyone, absolutely everyone, who by
virtue of their calling and by Divine inspiration, direction and guidance, is on the battlefield dayafter-day
striving to follow God’s will and purpose for their lives. And this is with particular affinity
for those Spiritual warriors who are being transformed into excellence through daily academic,
professional, familial, and other challenges.
We pray that you will bear in mind:
Matthew 19:26 (NLT)
Jesus looked at them intently and said, “Humanly speaking, it is impossible.
But with God everything is possible.” (Emphasis added)
To all of us who daily look past our circumstances, and naysayers, to what the Lord says we will
accomplish:
Blessings!!
- The Advocacy Foundation, Inc.
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The Transformative Justice Project
Eradicating Juvenile Delinquency Requires a Multi-Disciplinary Approach
The Juvenile Justice system is incredibly
overloaded, and Solutions-Based programs are
woefully underfunded. Our precious children,
therefore, particularly young people of color, often
get the “swift” version of justice whenever they
come into contact with the law.
Decisions to build prison facilities are often based
on elementary school test results, and our country
incarcerates more of its young than any other
nation on earth. So we at The Foundation labor to
pull our young people out of the “school to prison”
pipeline, and we then coordinate the efforts of the
legal, psychological, governmental and educational
professionals needed to bring an end to
delinquency.
We also educate families, police, local businesses,
elected officials, clergy, schools and other
stakeholders about transforming whole communities, and we labor to change their
thinking about the causes of delinquency with the goal of helping them embrace the
idea of restoration for the young people in our care who demonstrate repentance for
their mistakes.
The way we accomplish all this is a follows:
1. We vigorously advocate for charges reductions, wherever possible, in the
adjudicatory (court) process, with the ultimate goal of expungement or pardon, in
order to maximize the chances for our clients to graduate high school and
progress into college, military service or the workforce without the stigma of a
criminal record;
2. We then endeavor to enroll each young person into an Evidence-Based, Data-
Driven Transformative Justice program designed to facilitate their rehabilitation
and subsequent reintegration back into the community;
3. While those projects are operating, we conduct a wide variety of ComeUnity-
ReEngineering seminars and workshops on topics ranging from Juvenile Justice
to Parental Rights, to Domestic issues to Police friendly contacts, to Mental
Health intervention, to CBO and FBO accountability and compliance;
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4. Throughout the process, we encourage and maintain frequent personal contact
between all parties;
5 Throughout the process we conduct a continuum of events and fundraisers
designed to facilitate collaboration among professionals and community
stakeholders; and finally
6. 1 We disseminate Monthly and Quarterly publications, like our e-Advocate series
Newsletter and our e-Advocate Monthly and Quarterly Electronic Compilations to
all regular donors in order to facilitate a lifelong learning process on the everevolving
developments in both the Adult and Juvenile Justice systems.
And in addition to the help we provide for our young clients and their families, we also
facilitate Community Engagement through the Transformative Justice process,
thereby balancing the interests of local businesses, schools, clergy, social
organizations, elected officials, law enforcement entities, and other interested
stakeholders. Through these efforts, relationships are built, rebuilt and strengthened,
local businesses and communities are enhanced & protected from victimization, young
careers are developed, and our precious young people are kept out of the prison
pipeline.
Additionally, we develop Transformative “Void Resistance” (TVR) initiatives to elevate
concerns of our successes resulting in economic hardship for those employed by the
penal system.
TVR is an innovative-comprehensive process that works in conjunction with our
Transformative Justice initiatives to transition the original use and purpose of current
systems into positive social impact operations, which systematically retrains current
staff, renovates facilities, creates new employment opportunities, increases salaries and
is data-proven to enhance employee’s mental wellbeing and overall quality of life – an
exponential Transformative Social Impact benefit for ALL community stakeholders.
This is a massive undertaking, and we need all the help and financial support you can
give! We plan to help 75 young persons per quarter-year (aggregating to a total of 250
per year) in each jurisdiction we serve) at an average cost of under $2,500 per client,
per year. *
Thank you in advance for your support!
* FYI:
1
In addition to supporting our world-class programming and support services, all regular donors receive our Quarterly e-Newsletter
(The e-Advocate), as well as The e-Advocate Quarterly Magazine.
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1. The national average cost to taxpayers for minimum-security youth incarceration,
is around $43,000.00 per child, per year.
2. The average annual cost to taxpayers for maximum-security youth incarceration
is well over $148,000.00 per child, per year.
- (US News and World Report, December 9, 2014);
3. In every jurisdiction in the nation, the Plea Bargaining rate is above 99%.
The Judicial system engages in a tri-partite balancing task in every single one of these
matters, seeking to balance Rehabilitative Justice with Community Protection and
Judicial Economy, and, although the practitioners work very hard to achieve positive
outcomes, the scales are nowhere near balanced where people of color are involved.
We must reverse this trend, which is right now working very much against the best
interests of our young.
Our young people do not belong behind bars.
- Jack Johnson
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The Advocacy Foundation, Inc.
Helping Individuals, Organizations & Communities
Achieve Their Full Potential
…a compendium of works on
Organized Crime
In The New Millennium
“Turning the Improbable Into the Exceptional”
Atlanta
Philadelphia
______
John C Johnson III
Founder & CEO
(878) 222-0450
Voice | Data | SMS
www.TheAdvocacy.Foundation
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And God spoke all these words:
Biblical Authority
______
Exodus 20:1-20 (NIV)
The Ten Commandments
2
“I am the Lord your God, who brought you out of Egypt, out of the land of slavery.
3
“You shall have no other gods before me.
4
“You shall not make for yourself an image in the form of anything in heaven above or
on the earth beneath or in the waters below. 5 You shall not bow down to them or
worship them; for I, the Lord your God, am a jealous God, punishing the children for the
sin of the parents to the third and fourth generation of those who hate me, 6 but showing
love to a thousand generations of those who love me and keep my commandments.
7
“You shall not misuse the name of the Lord your God, for the Lord will not hold anyone
guiltless who misuses his name.
8
“Remember the Sabbath day by keeping it holy. 9 Six days you shall labor and do all
your work, 10 but the seventh day is a sabbath to the Lord your God. On it you shall not
do any work, neither you, nor your son or daughter, nor your male or female servant,
nor your animals, nor any foreigner residing in your towns. 11 For in six days
the Lord made the heavens and the earth, the sea, and all that is in them, but he
rested on the seventh day. Therefore the Lord blessed the Sabbath day and made it
holy.
12
“Honor your father and your mother, so that you may live long in the
land the Lord your God is giving you.
13
“You shall not murder.
14
“You shall not commit adultery.
15
“You shall not steal.
16
“You shall not give false testimony against your neighbor.
17
“You shall not covet your neighbor’s house. You shall not covet your neighbor’s wife,
or his male or female servant, his ox or donkey, or anything that belongs to your
neighbor.”
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18
When the people saw the thunder and lightning and heard the trumpet and saw the
mountain in smoke, they trembled with fear. They stayed at a distance 19 and said to
Moses, “Speak to us yourself and we will listen. But do not have God speak to us or we
will die.”
20
Moses said to the people, “Do not be afraid. God has come to test you, so that the
fear of God will be with you to keep you from sinning.”
Proverbs 28:5
5
Evildoers do not understand what is right,
but those who seek the Lord understand it fully.
1 Samuel 8:3
3
But his sons did not follow his ways. They turned aside after dishonest gain and
accepted bribes and perverted justice.
2 Samuel 11:2-17
2
One evening David got up from his bed and walked around on the roofof the palace.
From the roof he saw a woman bathing. The woman was very beautiful, 3 and David
sent someone to find out about her. The man said, “She is Bathsheba, the daughter of
Eliam and the wife of Uriah the Hittite.” 4 Then David sent messengers to get her. She
came to him, and he slept with her. (Now she was purifying herself from her monthly
uncleanness.) Then she went back home. 5 The woman conceived and sent word to
David, saying, “I am pregnant.”
6
So David sent this word to Joab: “Send me Uriah the Hittite.” And Joab sent him to
David. 7 When Uriah came to him, David asked him how Joab was, how the soldiers
were and how the war was going. 8 Then David said to Uriah, “Go down to your house
and wash your feet.” So Uriah left the palace, and a gift from the king was sent after
him. 9 But Uriah slept at the entrance to the palace with all his master’s servants and did
not go down to his house.
10
David was told, “Uriah did not go home.” So he asked Uriah, “Haven’t you just come
from a military campaign? Why didn’t you go home?”
11
Uriah said to David, “The ark and Israel and Judah are staying in tents, [a] and my
commander Joab and my lord’s men are camped in the open country. How could I go to
my house to eat and drink and make love to my wife? As surely as you live, I will not do
such a thing!”
12
Then David said to him, “Stay here one more day, and tomorrow I will send you back.”
So Uriah remained in Jerusalem that day and the next. 13 At David’s invitation, he ate
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and drank with him, and David made him drunk. But in the evening Uriah went out to
sleep on his mat among his master’s servants; he did not go home.
14
In the morning David wrote a letter to Joab and sent it with Uriah. 15 In it he wrote, “Put
Uriah out in front where the fighting is fiercest. Then withdraw from him so he will be
struck down and die.”
16
So while Joab had the city under siege, he put Uriah at a place where he knew the
strongest defenders were. 17 When the men of the city came out and fought against
Joab, some of the men in David’s army fell; moreover, Uriah the Hittite died.
Matthew 2:16
16
When Herod realized that he had been outwitted by the Magi, he was furious, and he
gave orders to kill all the boys in Bethlehem and its vicinity who were two years old and
under, in accordance with the time he had learned from the Magi.
Mark 14:55-56
55
The chief priests and the whole Sanhedrin were looking for evidence against Jesus so
that they could put him to death, but they did not find any. 56 Many testified falsely
against him, but their statements did not agree.
Acts 6:13
13
They produced false witnesses, who testified, “This fellow never stops speaking
against this holy place and against the law.
Acts 25:7
7
When Paul came in, the Jews who had come down from Jerusalem stood around him.
They brought many serious charges against him, but they could not prove them.
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Table of Contents
…a compilation of works on
Organized Crime
In The New Millennium
Biblical Authority
I. Introduction: Organized Crime and White Collar Crime……………….. 21
II. Arms Trafficking………………………………………………………….... 57
III. Bribery………………………………………………………………………. 63
IV. Cybercrime…………………………………………………………………. 73
V. Drug Trafficking……………………………………………………………. 85
VI. Embezzlement……………………………………………………………. 105
VII. Extortion…………………………………………………………………… 111
VIII. Fencing Stolen Goods…………………………………………………… 115
IX. Fraud………………………………………………………………………. 123
X. Identity Theft……………………………………………………………… 133
XI. Kidnapping…………….………………………………………………….. 155
XII. Loan Sharking………………………………………………………......... 161
XIII. Money Laundering……………………………………………………….. 169
XIV. Murder……………………………………………………………………… 201
XV. Prostitution………………………………………………………………… 219
XVI. Racketeering……………………………………………………………… 245
XVII. Terrorism………………………………………………………………….. 249
XVIII. Theft……………………………………………………………………….. 275
XIX. Witness Tampering and Intimidation......………………………….…… 293
XX. Transnational Crime……………………………………………………… 299
XXI. Criminal Enterprises, Gangs and Syndicates…………………………. 303
XXII. References……………………………………………………................. 337
________
Attachments
A. Biblical Atonement and Modern Criminal Law
B. Organized Crime: An Evolving Challenge for Law Enforcement
C. Transnational Organized Crime – The Globalized Illegal Economy
Copyright © 2003 – 2019 The Advocacy Foundation, Inc. All Rights Reserved.
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This work is not meant to be a piece of original academic
analysis, but rather draws very heavily on the work of
scholars in a diverse range of fields. All material drawn upon
is referenced appropriately.
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I. Introduction
Organized Crime
In The New Millennium
Organized Crime is a category of transnational, national, or local groupings of highly
centralized enterprises run by criminals who intend to engage in illegal activity, most
commonly for profit. Some criminal organizations, such as terrorist groups, are politically
motivated. Sometimes criminal organizations force people to do business with them,
such as when a gang extorts money from shopkeepers for "protection". Gangs may
become disciplined enough to be considered organized. A criminal organization or
gang can also be referred to as a mafia, mob, or crime syndicate; the network,
subculture and community of criminals may be referred to as the underworld.
European sociologists (e.g. Diego Gambetta) define the mafia as a type of organized
crime group that specializes in the supply of extra-legal protection and quasi law
enforcement. Gambetta's classic work on the Sicilian Mafia generates an economic
study of the mafia, which exerts great influence on studies of the Russian Mafia, the
Chinese Mafia, Hong Kong Triads and the Japanese Yakuza.
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Other organizations—including states, churches, militaries, police forces, and
corporations—may sometimes use organized-crime methods to conduct their activities,
but their powers derive from their status as formal social institutions. There is a
tendency to distinguish organized crime from other forms of crime, such as white-collar
crime, financial crimes, political crimes, war crime, state crimes, and treason.
This distinction is not always apparent and academics continue to debate the matter.
For example, in failed states that can no longer perform basic functions such as
education, security, or governance (usually due to fractious violence or to extreme
poverty), organized crime, governance and war sometimes complement each other.
The term "Oligarchy" has been used to describe democratic countries whose political,
social and economic institutions come under the control of a few families and business
oligarchs.
In the United States, the Organized Crime Control Act (1970) defines organized crime
as "[t]he unlawful activities of [...] a highly organized, disciplined association
[...]".Criminal activity as a structured process is referred to as racketeering. In the UK,
police estimate that organized crime involves up to 38,000 people operating in 6,000
various groups.
Due to the escalating violence of Mexico's drug war, a report issued by the United
States Department of Justice characterizes the Mexican drug cartels as the "greatest
organized crime threat to the United States".
Organizational
Patron-Client Networks
Models
Patron-client networks are defined by fluid interactions. They produce crime groups that
operate as smaller units within the overall network, and as such tend towards valuing
significant others, familiarity of social and economic environments, or tradition. These
networks are usually composed of:
Hierarchies based on 'naturally' forming family, social and cultural traditions;
'Tight-knit' focus of activity/labor;
Fraternal or nepotistic value systems;
Personalized activity; including family rivalries, territorial disputes, recruitment
and training of family members, etc.;
Entrenched belief systems, reliance of tradition (including religion, family values,
cultural expectations, class politics, gender roles, etc.); and,
Communication and rule enforcement mechanisms dependent on organizational
structure, social etiquette, history of criminal involvement, and collective decisionmaking.
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Bureaucratic/ Corporate Operations
Bureaucratic/corporate organized crime groups are defined by the general rigidity of
their internal structures. They focus more on how the operations works, succeeds,
sustains itself or avoids retribution, they are generally typified by:
A complex authority structure;
An extensive division of labor between classes within the organization;
Meritocratic (as opposed to cultural or social attributes);
Responsibilities carried out in an impersonal manner;
Extensive written rules/regulations (as opposed to cultural praxis dictating
action); and,
'Top-down' communication and rule enforcement mechanisms.
However, this model of operation has some flaws:
The 'top-down' communication strategy is susceptible to interception, more so
further down the hierarchy being communicated to;
Maintaining written records jeopardizes the security of the organization and relies
on increased security measures;
Infiltration at lower levels in the hierarchy can jeopardize the entire organization
(a 'house of cards' effect); and,
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Death, injury, incarceration or internal power struggles dramatically heighten the
insecurity of operations.
While bureaucratic operations emphasize business processes and strongly authoritarian
hierarchies, these are based on enforcing power relationships rather than an overlying
aim of protectionism, sustainability or growth.
Youth and Street Gangs
An estimate on youth street gangs nationwide provided by Hannigan, et al., marked an
increase of 35% between 2002 and 2010. A distinctive gang culture underpins many,
but not all, organized groups; this may develop through recruiting strategies, social
learning processes in the corrective system experienced by youth, family or peer
involvement in crime, and the coercive actions of criminal authority figures. The term
“street gang” is commonly used interchangeably with “youth gang,” referring to
neighborhood or street-based youth groups that meet “gang” criteria. Miller (1992)
defines a street gang as “a self-formed association of peers, united by mutual interests,
with identifiable leadership and internal organization, who act collectively or as
individuals to achieve specific purposes, including the conduct of illegal activity and
control of a particular territory, facility, or enterprise." Some reasons youth join gangs
include to feel accepted, attain status, and increase their self-esteem. A sense of unity
brings together many of the youth gangs that lack the family aspect at home.
"Zones of transition" are deteriorating neighborhoods with shifting populations. In such
areas, conflict between groups, fighting, "turf wars", and theft promote solidarity and
cohesion. Cohen (1955): working class teenagers joined gangs due to frustration of
inability to achieve status and goals of the middle class; Cloward and Ohlin (1960):
blocked opportunity, but unequal distribution of opportunities lead to creating different
types of gangs (that is, some focused on robbery and property theft, some on fighting
and conflict and some were retreatists focusing on drug taking); Spergel (1966) was one
of the first criminologists to focus on evidence-based practice rather than intuition into
gang life and culture. Participation in gang-related events during adolescence
perpetuate a pattern of maltreatment on their own children years later. Klein (1971) like
Spergel studied the effects on members of social workers’ interventions. More
interventions actually lead to greater gang participation and solidarity and bonds
between members. Downes and Rock (1988) on Parker’s analysis: strain theory
applies, labeling theory (from experience with police and courts), control theory
(involvement in trouble from early childhood and the eventual decision that the costs
outweigh the benefits) and conflict theories. No ethnic group is more disposed to gang
involvement than another, rather it is the status of being marginalized, alienated or
rejected that makes some groups more vulnerable to gang formation, and this would
also be accounted for in the effect of social exclusion, especially in terms of recruitment
and retention. These may also be defined by age (typically youth) or peer group
influences, and the permanence or consistency of their criminal activity. These groups
also form their own symbolic identity or public representation which are recognizable by
the community at large (include colors, symbols, patches, flags and tattoos).
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Research has focused on whether the gangs have formal structures, clear hierarchies
and leadership in comparison with adult groups, and whether they are rational in pursuit
of their goals, though positions on structures, hierarchies and defined roles are
conflicting. Some studied street gangs involved in drug dealing - finding that their
structure and behavior had a degree of organizational rationality. Members saw
themselves as organized criminals; gangs were formal-rational organizations, Strong
organizational structures, well defined roles and rules that guided members’ behavior.
Also a specified and regular means of income (i.e., drugs). Padilla (1992) agreed with
the two above. However some have found these to be loose rather than well-defined
and lacking persistent focus, there was relatively low cohesion, few shared goals and
little organizational structure. Shared norms, value and loyalties were low, structures
"chaotic", little role differentiation or clear distribution of labor. Similarly, the use of
violence does not conform to the principles behind protection rackets, political
intimidation and drug trafficking activities employed by those adult groups. In many
cases gang members graduate from youth gangs to highly developed OC groups, with
some already in contact with such syndicates and through this we see a greater
propensity for imitation. Gangs and traditional criminal organizations cannot be
universally linked (Decker, 1998), however there are clear benefits to both the adult and
youth organization through their association. In terms of structure, no single crime group
is archetypal, though in most cases there are well-defined patterns of vertical integration
(where criminal groups attempt to control the supply and demand), as is the case in
arms, sex and drug trafficking.
Entrepreneurial
Individual Difference
The entrepreneurial model looks at either the individual criminal or a smaller group of
organized criminals, that capitalize off the more fluid 'group-association' of
contemporary organized crime. This model conforms to social learning theory or
differential association in that there are clear associations and interaction between
criminals where knowledge may be shared, or values enforced, however, it is argued
that rational choice is not represented in this. The choice to commit a certain act, or
associate with other organized crime groups, may be seen as much more of an
entrepreneurial decision - contributing to the continuation of a criminal enterprise, by
maximizing those aspects that protect or support their own individual gain. In this
context, the role of risk is also easily understandable, however it is debatable whether
the underlying motivation should be seen as true entrepreneurship or entrepreneurship
as a product of some social disadvantage.
The criminal organization, much in the same way as one would assess pleasure and
pain, weighs such factors as legal, social and economic risk to determine potential profit
and loss from certain criminal activities. This decision-making process rises from the
entrepreneurial efforts of the group's members, their motivations and the environments
in which they work. Opportunism is also a key factor – the organized criminal or criminal
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group is likely to frequently reorder the criminal associations they maintain, the types of
crimes they perpetrate, and how they function in the public arena (recruitment,
reputation, etc.) in order to ensure efficiency, capitalization and protection of their
interests.
Multi-Model Approach
Culture and ethnicity provide an environment where trust and communication between
criminals can be efficient and secure. This may ultimately lead to a competitive
advantage for some groups; however, it is inaccurate to adopt this as the only
determinant of classification in organized crime. This categorization includes the Sicilian
Mafia, ’Ndrangheta, ethnic Chinese criminal groups, Japanese Yakuza (or Boryokudan),
Colombian drug trafficking groups, Nigerian organized crime groups, Corsican mafia,
Korean criminal groups and Jamaican posses. From this perspective, organized crime
is not a modern phenomenon - the construction of 17th and 18th century crime gangs
fulfill all the present day criteria of criminal organizations (in opposition to the Alien
Conspiracy Theory). These roamed the rural borderlands of central Europe embarking
on many of the same illegal activities associated with today’s crime organizations, with
the exception of money laundering. When the French revolution created strong nation
states, the criminal gangs moved to other poorly controlled regions like the Balkans and
Southern Italy, where the seeds were sown for the Sicilian Mafia - the lynchpin of
organized crime in the New World.
Model Type Environment Group Processes Impacts
National
Transnational
Transnational/Transactional
Entrepreneurial/Transactional
Historical or
cultural basis
Politically and
economically
unstable
Any
Developed/high
technology
regions
Family or
hierarchy
Vertical
integration
Flexible.
Small
size.
Individuals
or pairs.
Secrecy/bonds.
Links to
insurgents
Legitimate
cover
Violent.
Opportunistic.
Risk taking
Operating
through
legitimate
enterprise
Local
corruption/influence.
Fearful community.
Stable supply of illicit
goods. High-level
corruption.
Unstable supply of
range of illicit goods.
Exploits young local
offenders.
Provision of illicit
services, e.g.,
money laundering,
fraud, criminal
networks.
Typical Activities
Organized crime groups provide a range of illegal services and goods. Organized crime
often victimizes businesses through the use of extortion or theft and fraud activities like
hijacking cargo trucks, robbing goods, committing bankruptcy fraud (also known as
"bust-out"), insurance fraud or stock fraud (inside trading). Organized crime groups also
victimize individuals by car theft (either for dismantling at "chop shops" or for export), art
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theft, bank robbery, burglary, jewelry and gems theft and heists, shoplifting, computer
hacking, credit card fraud, economic espionage, embezzlement, identity theft, and
securities fraud ("pump and dump" scam). Some organized crime groups defraud
national, state, or local governments by bid rigging public projects, counterfeiting
money, smuggling or manufacturing untaxed alcohol (bootlegging) or cigarettes
(buttlegging), and providing immigrant workers to avoid taxes.
Organized crime groups seek out corrupt public officials in executive, law enforcement,
and judicial roles so that their activities can avoid, or at least receive early warnings
about, investigation and prosecution.
Activities of organized crime include loansharking of money at very high interest rates,
assassination, blackmailing, bombings, bookmaking and illegal gambling, confidence
tricks, copyright infringement, counterfeiting of intellectual property, fencing, kidnapping,
prostitution, smuggling, drug trafficking, arms trafficking, oil smuggling, antiquities
smuggling, organ trafficking, contract killing, identity document forgery, money
laundering, bribery, seduction, electoral fraud, insurance fraud, point shaving, price
fixing, illegal taxicab operation, illegal dumping of toxic waste, illegal trading of nuclear
materials, military equipment smuggling, nuclear weapons smuggling, passport fraud,
providing illegal immigration and cheap labor, people smuggling, trading in endangered
species, and trafficking in human beings. Organized crime groups also do a range of
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usiness and labor racketeering activities, such as skimming casinos, insider trading,
setting up monopolies in industries such as garbage collecting, construction and cement
pouring, bid rigging, getting "no-show" and "no-work" jobs, political corruption and
bullying.
Assault
Violence
The commission of violent crime may form part of a criminal organization's 'tools' used
to achieve criminogenic goals (for example, its threatening, authoritative, coercive,
terror-inducing, or rebellious role), due to psychosocial factors (cultural conflict,
aggression, rebellion against authority, access to illicit substances, counter-cultural
dynamic), or may, in and of itself, be crime rationally chosen by individual criminals and
the groups they form. Assaults are used for coercive measures, to "rough up" debtors,
competition or recruits, in the commission of robberies, in connection to other property
offenses, and as an expression of counter-cultural authority; violence is normalized
within criminal organizations (in direct opposition to mainstream society) and the
locations they control.
Whilst the intensity of violence is dependent on the types of crime the organization is
involved in (as well as their organizational structure or cultural tradition) aggressive acts
range on a spectrum from low-grade physical assaults to murder. Bodily harm and
grievous bodily harm, within the context of organized crime, must be understood as
indicators of intense social and cultural conflict, motivations contrary to the security of
the public, and other psychosocial factors.
Murder
Murder has evolved from the honor and vengeance killings of the Yakuza or Sicilian
mafia which placed large physical and symbolic importance on the act of murder, its
purposes and consequences, to a much less discriminate form of expressing power,
enforcing criminal authority, achieving retribution or eliminating competition. The role of
the hit man has been generally consistent throughout the history of organized crime,
whether that be due to the efficiency or expediency of hiring a professional assassin or
the need to distance oneself from the commission of murderous acts (making it harder
to prove liability). This may include the assassination of notable figures (public, private
or criminal), once again dependent on authority, retribution or competition. Revenge
killings, armed robberies, violent disputes over controlled territories and offenses
against members of the public must also be considered when looking at the dynamic
between different criminal organizations and their (at times) conflicting needs.
Terrorism
In addition to what is considered traditional organized crime involving direct crimes of
fraud swindles, scams, racketeering and other Racketeer Influenced and Corrupt
Organizations Act (RICO) predicate acts motivated for the accumulation of monetary
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gain, there is also non-traditional organized crime which is engaged in for political or
ideological gain or acceptance. Such crime groups are often labelled terrorist groups.
There is no universally agreed, legally binding, criminal law definition of terrorism.
Common definitions of terrorism refer only to those violent acts which are intended to
create fear (terror), are perpetrated for a religious, political or ideological goal,
deliberately target or disregard the safety of non-combatants (e.g., neutral military
personnel or civilians), and are committed by non-government agencies. Some
definitions also include acts of unlawful violence and war, especially crimes against
humanity (see the Nuremberg Trials), Allied authorities deeming the German Nazi
Party, its paramilitary and police organizations, and numerous associations subsidiary
to the Nazi Party "criminal organizations". The use of similar tactics by criminal
organizations for protection rackets or to enforce a code of silence is usually not labeled
terrorism though these same actions may be labeled terrorism when done by a
politically motivated group.
Notable groups include Al-Qaeda, Animal Liberation Front, Army of God, Black
Liberation Army, The Covenant, The Sword, and the Arm of the Lord, Earth Liberation
Front, Irish Republican Army, Kurdistan Workers' Party, Lashkar e Toiba, May 19th
Communist Organization, The Order, Revolutionary Armed Forces of Colombia,
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Symbionese Liberation Army, Taliban, United Freedom Front and Weather
Underground.
Other
Arms trafficking
Arson
Coercion
Extortion
Protection racket
Sexual assault
Financial Crime
Organized crime groups generate large amounts of money by activities such as drug
trafficking, arms smuggling and financial crime. This is of little use to them unless they
can disguise it and convert it into funds that are available for investment into legitimate
enterprise. The methods they use for converting its ‘dirty’ money into ‘clean’ assets
encourages corruption. Organized crime groups need to hide the money’s illegal origin.
It allows for the expansion of OC groups, as the ‘laundry’ or ‘wash cycle’ operates to
cover the money trail and convert proceeds of crime into usable assets.
Money laundering is bad for international and domestic trade, banking reputations and
for effective governments and rule of law. Accurate figures for the amounts of criminal
proceeds laundered are almost impossible to calculate, and the Financial Action Task
Force on Money Laundering (FATF), an intergovernmental body set up to combat
money laundering, has stated that "overall it is absolutely impossible to produce a
reliable estimate of the amount of money laundered and therefore the FATF does not
publish any figures in this regard". However, in the US estimated figures of money
laundering have been put at between $200 – $600 billion per year throughout the 1990s
(US Congress Office 1995; Robinson 1996), and in 2002 this was estimated between
$500 billion to $1 trillion per year (UN 2002). This would make organized crime the third
largest business in world after foreign exchange and oil (Robinson 1996). The rapid
growth of money laundering is due to:
the scale of organized crime precluding it from being a cash business - groups
have little option but to convert its proceeds into legitimate funds and do so by
investment, by developing legitimate businesses and purchasing property;
globalization of communications and commerce - technology has made rapid
transfer of funds across international borders much easier, with groups
continuously changing techniques to avoid investigation; and,
a lack of effective financial regulation in parts of the global economy.
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Money laundering is a three-stage process:
Placement: (also called immersion) groups ‘smurf’ small amounts at a time to
avoid suspicion; physical disposal of money by moving crime funds into the
legitimate financial system; may involve bank complicity, mixing licit and illicit
funds, cash purchases and smuggling currency to safe havens.
Layering: disguises the trail to foil pursuit. Also called ‘heavy soaping’. It involves
creating false paper trails, converting cash into assets by cash purchases.
Integration: (also called ‘spin dry): Making it into clean taxable income by realestate
transactions, sham loans, foreign bank complicity and false import and
export transactions.
Means of money laundering:
Money transmitters, black money markets purchasing goods, gambling,
increasing the complexity of the money trail.
Underground banking (flying money), involves clandestine ‘bankers’ around the
world.
It often involves otherwise legitimate banks and professionals.
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The policy aim in this area is to make the financial markets transparent, and minimize
the circulation of criminal money and its cost upon legitimate markets.
Counterfeiting
In 2007, the OECD reported the scope of counterfeit products to include food,
pharmaceuticals, pesticides, electrical components, tobacco and even household
cleaning products in addition to the usual films, music, literature, games and other
electrical appliances, software and fashion. A number of qualitative changes in the trade
of counterfeit products:
a large increase in fake goods which are dangerous to health and safety;
most products repossessed by authorities are now household items rather than
luxury goods;
a growing number of technological products; and,
production is now operated on an industrial scale.
Tax evasion
The economic effects of organized crime have been approached from a number of both
theoretical and empirical positions, however the nature of such activity allows for
misrepresentation. The level of taxation taken by a nation-state, rates of unemployment,
mean household incomes and level of satisfaction with government and other economic
factors all contribute to the likelihood of criminals to participate in tax evasion. As most
organized crime is perpetrated in the liminal state between legitimate and illegitimate
markets, these economic factors must adjusted to ensure the optimal amount of
taxation without promoting the practice of tax evasion. As with any other crime,
technological advancements have made the commission of tax evasion easier, faster
and more globalized. The ability for organized criminals to operate fraudulent financial
accounts, utilize illicit offshore bank accounts, access tax havens or tax shelters, and
operating goods smuggling syndicates to evade importation taxes help ensure financial
sustainability, security from law enforcement, general anonymity and the continuation of
their operations.
Internet Fraud
Cybercrime
Identity theft is a form of fraud or cheating of another person's identity in which
someone pretends to be someone else by assuming that person's identity, typically in
order to access resources or obtain credit and other benefits in that person's name.
Victims of identity theft (those whose identity has been assumed by the identity thief)
can suffer adverse consequences if held accountable for the perpetrator's actions, as
can organizations and individuals who are defrauded by the identity thief, and to that
extent are also victims. Internet fraud refers to the actual use of Internet services to
present fraudulent solicitations to prospective victims, to conduct fraudulent
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transactions, or to transmit the proceeds of fraud to financial institutions or to others
connected with the scheme. In the context of organized crime, both may serve as
means through which other criminal activity may be successfully perpetrated or as the
primary goal themselves. Email fraud, advance-fee fraud, romance scams, employment
scams, and other phishing scams are the most common and most widely used forms of
identity theft, though with the advent of social networking fake websites, accounts and
other fraudulent or deceitful activity has become commonplace.
Copyright Infringement
Copyright infringement is the unauthorized or prohibited use of works under copyright,
infringing the copyright holder's exclusive rights, such as the right to reproduce or
perform the copyrighted work, or to make derivative works. Whilst almost universally
considered under civil procedure, the impact and intent of organized criminal operations
in this area of crime has been the subject of much debate. Article 61 of the Agreement
on Trade-Related Aspects of Intellectual Property Rights (TRIPs) requires that signatory
countries establish criminal procedures and penalties in cases of willful trademark
counterfeiting or copyright piracy on a commercial scale.
More recently copyright holders have demanded that states provide criminal sanctions
for all types of copyright infringement. Organized criminal groups capitalize on
consumer complicity, advancements in security and anonymity technology, emerging
markets and new methods of product transmission, and the consistent nature of these
provides a stable financial basis for other areas of organized crime.
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Cyberwarfare
Cyberwarfare refers to politically motivated hacking to conduct sabotage and
espionage. It is a form of information warfare sometimes seen as analogous to
conventional warfare although this analogy is controversial for both its accuracy and its
political motivation. It has been defined as activities by a nation-state to penetrate
another nation's computers or networks with the intention of causing civil damage or
disruption. Moreover, it acts as the "fifth domain of warfare," and William J. Lynn, U.S.
Deputy Secretary of Defense, states that "as a doctrinal matter, the Pentagon has
formally recognized cyberspace as a new domain in warfare . . . [which] has become
just as critical to military operations as land, sea, air, and space." Cyber espionage is
the practice of obtaining confidential, sensitive, proprietary or classified information from
individuals, competitors, groups, or governments using illegal exploitation methods on
internet, networks, software and/or computers. There is also a clear military, political, or
economic motivation. Unsecured information may be intercepted and modified, making
espionage possible internationally. The recently established Cyber Command is
currently debating whether such activities as commercial espionage or theft of
intellectual property are criminal activities or actual "breaches of national security."
Furthermore, military activities that use computers and satellites for coordination are at
risk of equipment disruption. Orders and communications can be intercepted or
replaced. Power, water, fuel, communications, and transportation infrastructure all may
be vulnerable to sabotage. According to Clarke, the civilian realm is also at risk, noting
that the security breaches have already gone beyond stolen credit card numbers, and
that potential targets can also include the electric power grid, trains, or the stock market.
Computer Viruses
The term "computer virus" may be used as an overarching phrase to include all types of
true viruses, malware, including computer worms, Trojan horses, most rootkits,
spyware, dishonest adware and other malicious and unwanted software (though all are
technically unique), and proves to be quite financially lucrative for criminal
organizations, offering greater opportunities for fraud and extortion whilst increasing
security, secrecy and anonymity. Worms may be utilized by organized crime groups to
exploit security vulnerabilities (duplicating itself automatically across other computers a
given network), while a Trojan horse is a program that appears harmless but hides
malicious functions (such as retrieval of stored confidential data, corruption of
information, or interception of transmissions). Worms and Trojan horses, like viruses,
may harm a computer system's data or performance. Applying the Internet model of
organized crime, the proliferation of computer viruses and other malicious software
promotes a sense of detachment between the perpetrator (whether that be the criminal
organization or another individual) and the victim; this may help to explain vast
increases in cyber-crime such as these for the purpose of ideological crime or terrorism.
In mid July 2010, security experts discovered a malicious software program that had
infiltrated factory computers and had spread to plants around the world. It is considered
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"the first attack on critical industrial infrastructure that sits at the foundation of modern
economies," notes the New York Times.
Corporate Crime
White-Collar Crime and Corruption
Corporate crime refers to crimes committed either by a corporation (i.e., a business
entity having a separate legal personality from the natural persons that manage its
activities), or by individuals that may be identified with a corporation or other business
entity (see vicarious liability and corporate liability). Note that some forms of corporate
corruption may not actually be criminal if they are not specifically illegal under a given
system of laws. For example, some jurisdictions allow insider trading.
Labor Racketeering
Labor racketeering has developed since the 1930s, affecting national and international
construction, mining, energy production and transportation sectors immensely. Activity
has focused on the importation of cheap or unfree labor, involvement with union and
public officials (political corruption), and counterfeiting.
Political Corruption
Political corruption is the use of legislated powers by government officials for illegitimate
private gain. Misuse of government power for other purposes, such as repression of
political opponents and general police brutality, is not considered political corruption.
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Neither are illegal acts by private persons or corporations not directly involved with the
government. An illegal act by an officeholder constitutes political corruption only if the
act is directly related to their official duties. Forms of corruption vary, but include bribery,
extortion, cronyism, nepotism, patronage, graft, and embezzlement. While corruption
may facilitate criminal enterprise such as drug trafficking, money laundering, and human
trafficking, it is not restricted to these activities. The activities that constitute illegal
corruption differ depending on the country or jurisdiction. For instance, certain political
funding practices that are legal in one place may be illegal in another. In some cases,
government officials have broad or poorly defined powers, which make it difficult to
distinguish between legal and illegal actions. Worldwide, bribery alone is estimated to
involve over 1 trillion US dollars annually. A state of unrestrained political corruption is
known as a kleptocracy, literally meaning "rule by thieves".
Drug Trafficking
Mexican drug cartels and their areas of influence
Heroin: Source countries / production: three major
regions known as the Golden Triangle (Burma, Laos,
Thailand), Golden Crescent (Afghanistan) and
Central and South America. There are suggestions
that due to the continuing decline in opium production
in South East Asia, traffickers may begin to look to
Afghanistan as a source of heroin."
Sex Trafficking
Human Trafficking
Human trafficking for the purpose of sexual exploitation is a major cause of
contemporary sexual slavery and is primarily for prostituting women and children into
sex industries. Sexual slavery encompasses most, if not all, forms of forced prostitution.
The terms "forced prostitution" or "enforced prostitution" appear in international and
humanitarian conventions but have been insufficiently understood and inconsistently
applied. "Forced prostitution" generally refers to conditions of control over a person who
is coerced by another to engage in sexual activity. Official numbers of individuals in
sexual slavery worldwide vary.
In 2001 International Organization for Migration estimated 400,000, the Federal Bureau
of Investigation estimated 700,000 and UNICEF estimated 1.75 million. The most
common destinations for victims of human trafficking are Thailand, Japan, Israel,
Belgium, the Netherlands, Germany, Italy, Turkey and the United States, according to a
report by UNODC.
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Illegal Immigration and People Smuggling
People smuggling is defined as "the facilitation, transportation, attempted
transportation or illegal entry of a person or persons across an international border, in
violation of one or more countries laws, either clandestinely or through deception, such
as the use of fraudulent documents".
The term is understood as and often used interchangeably with migrant smuggling,
which is defined by the United Nations Convention Against Transnational Organized
Crime as "...the procurement, in order to obtain, directly or indirectly, a financial or other
material benefit, of the illegal entry of a person into a state party of which the person is
not a national".
This practice has increased over the past few decades and today now accounts for a
significant portion of illegal immigration in countries around the world.
People smuggling generally takes place with the consent of the person or persons being
smuggled, and common reasons for individuals seeking to be smuggled include
employment and economic opportunity, personal and/or familial betterment, and escape
from persecution or conflict.
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Contemporary Slavery and Forced Labor
The number of slaves today remains as high as 12 million to 27 million. This is probably
the smallest proportion of slaves to the rest of the world's population in history. Most are
debt slaves, largely in South Asia, who are under debt bondage incurred by lenders,
sometimes even for generations. It is the fastest growing criminal industry and is
predicted to eventually outgrow drug trafficking.
Pre-Nineteenth Century
Historical Origins
Today, crime is sometimes thought of as an urban phenomenon, but for most of human
history it was the rural interfaces that encountered the majority of crimes (bearing in
mind the fact that for most of human history, rural areas were the vast majority of
inhabited places). For the most part, within a village, members kept crime at very low
rates; however, outsiders such as pirates, highwaymen, and bandits attacked trade
routes and roads, at times severely disrupting commerce, raising costs, insurance rates
and prices to the consumer. According to criminologist Paul Lunde, "Piracy and banditry
were to the preindustrial world what organized crime is to modern society."
If we take a global rather than strictly domestic view, it becomes evident even crime of
the organized kind has a long if not necessarily noble heritage. The word 'thug' dates to
early 13th-century India, when Thugs, or gangs of criminals, roamed from town to town,
looting and pillaging. Smuggling and drug-trafficking rings are as old as the hills in Asia
and Africa, and extant criminal organizations in Italy and Japan trace their histories back
several centuries...
As Lunde states, "Barbarian conquerors, whether Vandals, Goths, the Norse, Turks or
Mongols are not normally thought of as organized crime groups, yet they share many
features associated with thriving criminal organizations. They were for the most part
non-ideological, predominantly ethnically based, used violence and intimidation, and
adhered to their own codes of law." Terrorism is linked to organized crime, but has
political aims rather than solely financial ones, so there is overlap but separation
between terrorism and organized crime.
Nineteenth Century
During the Victorian era, criminals and gangs started to form organizations which would
be collectively become London's criminal underworld. Criminal societies in the
underworld started to develop their own ranks and groups which were sometimes called
families, and were often made up of lower-classes and operated on pick-pocketry,
prostitution, forgery and counterfeiting, commercial burglary and even moneylaundering
schemes. Unique also were the use of slangs and argots used by Victorian
criminal societies to distinguish each other. One of the most infamous crime bosses in
the Victorian underworld was Adam Worth, who was nicknamed "the Napoleon of the
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criminal world" or "the Napoleon of Crime" and became the inspiration behind the
popular character of Professor Moriarty.
Organized crime in the United States first came to prominence in the Old West and
historians such as Brian J. Robb and Erin H. Turner traced the first organized crime
syndicates to the Coschise Cowboy Gang and the Wild Bunch. The Cochise Cowboys,
though loosely organized, were unique for their criminal operations in the Mexican
border, in which they would steal and sell cattle as well smuggled contraband goods in
between the countries.
Twentieth Century
Donald Cressey’s Cosa Nostra model studied Mafia families exclusively and this limits
his broader findings. Structures are formal and rational with allocated tasks, limits on
entrance, and influence the rules established for organizational maintenance and
sustainability. In this context there is a difference between organized and professional
crime; there is well-defined hierarchy of roles for leaders and members, underlying rules
and specific goals that determine their behavior, and these are formed as a social
system, one that was rationally designed to maximize profits and to provide forbidden
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goods. Albini saw organized criminal behavior as consisting of networks of patrons and
clients, rather than rational hierarchies or secret societies.
The networks are characterized by a loose system of power relations. Each participant
is interested in furthering his own welfare. Criminal entrepreneurs are the patrons and
they exchange information with their clients in order to obtain their support. Clients
include members of gangs, local and national politicians, government officials and
people engaged in legitimate business. People in the network may not directly be part of
the core criminal organization. Furthering the approach of both Cressey and Albini, Ianni
and Ianni studied Italian-American crime syndicates in New York and other cities.
Kinship is seen as the basis of organized crime rather than the structures Cressey had
identified; this includes fictive godparental and affinitive ties as well as those based on
blood relations, and it is the impersonal actions, not the status or affiliations of their
members, that define the group. Rules of conduct and behavioral aspects of power and
networks and roles include the following:
family operates as a social unit, with social and business functions merged;
leadership positions down to middle management are kinship based;
the higher the position, the closer the kinship relationship;
group assigns leadership positions to a central group of family members,
including fictive godparental relationship reinforcement;
the leadership group are assigned to legal or illegal enterprises, but not both;
and,
transfer of money, from legal and illegal business, and back to illegal business is
by individuals, not companies.
Strong family ties are derived from the traditions of southern Italy, where family rather
than the church or state is the basis of social order and morality.
The "Disorganized Crime" and Choice Theses
One of the most important trends to emerge in criminological thinking about OC in
recent years is the suggestion that it is not, in a formal sense, "organized" at all.
Evidence includes lack of centralized control, absence of formal lines of communication,
fragmented organizational structure. It is distinctively disorganized. For example,
Seattle's crime network in the 1970s and 80s consisted of groups of businessmen,
politicians and of law enforcement officers. They all had links to a national network via
Meyer Lansky, who was powerful, but there was no evidence that Lansky or anyone
else exercised centralized control over them.
While some crime involved well-known criminal hierarchies in the city, criminal activity
was not subject to central management by these hierarchies nor by other controlling
groups, nor were activities limited to a finite number of objectives. The networks of
criminals involved with the crimes did not exhibit organizational cohesion. Too much
emphasis had been placed on the Mafia as controlling OC. The Mafia were certainly
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powerful but they "were part of a heterogeneous underworld, a network characterized
by complex webs of relationships." OC groups were violent and aimed at making money
but because of the lack of structure and fragmentation of objectives, they were
"disorganized".
Further studies showed neither bureaucracy nor kinship groups are the primary
structure of organized crime, rather they were in partnerships or a series of joint
business ventures. Despite these conclusions, all researchers observed a degree of
managerial activities among the groups they studied. All observed networks and a
degree of persistence, and there may be utility in focusing on the identification of
organizing roles of people and events rather than the group's structure. There may be
three main approaches to understand the organizations in terms of their roles as social
systems:
Organizations as Rational Systems: Highly formalized structures in terms of
bureaucracy’s and hierarchy, with formal systems of rules regarding authority
and highly specific goals;
Organizations as Natural Systems: Participants may regard the organization
as an end in itself, not merely a means to some other end. Promoting group
values to maintain solidarity is high on the agenda. They do not rely on profit
maximization. Their perversity and violence in respect of relationships is often
remarkable, but they are characterized by their focus on the connections
between their members, their associates and their victims; and,
Organizations as Open Systems: High levels of interdependence between
themselves and the environment in which they operate. There is no one way in
which they are organized or how they operate. They are adaptable and change
to meet the demands of their changing environments and circumstances.
Organized crime groups may be a combination of all three.
International Governance Approach
International consensus on defining organized crime has become important since the
1970s due its increased prevalence and impact. e.g., UN in 1976 and EU 1998. OC is
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"...the large scale and complex criminal activity carried on by groups of persons,
however loosely or tightly organized for the enrichment of those participating at the
expense of the community and its members. It is frequently accomplished through
ruthless disregard of any law, including offenses against the person and frequently in
connection with political corruption." (UN) "A criminal organization shall mean a lasting,
structured association of two or more persons, acting in concert with a view to
committing crimes or other offenses which are punishable by deprivation of liberty or a
detention order of a maximum of at least four years or a more serious penalty, whether
such crimes or offenses are an end in themselves or a means of obtaining material
benefits and, if necessary, of improperly influencing the operation of public authorities."
(UE) Not all groups exhibit the same characteristics of structure. However, violence and
corruption and the pursuit of multiple enterprises and continuity serve to form the
essence of OC activity.
There are eleven characteristics from the European Commission and Europol pertinent
to a working definition of organized crime. Six of those must be satisfied and the four in
italics are mandatory. Summarized, they are:
more than two people;
their own appointed tasks;
activity over a prolonged or indefinite period of time;
the use discipline or control;
perpetration of serious criminal offenses;
operations on an international or transnational level;
the use violence or other intimidation;
the use of commercial or businesslike structures;
engagement in money laundering;
exertion of influence on politics, media, public administration, judicial authorities
or the economy; and,
motivated by the pursuit of profit and/or power,
- with the Convention against Transnational Organized Crime (the
Palermo Convention) having a similar definition:
organized criminal: structured group, three or more people, one or more serious
crimes, in order to obtain financial or other material benefit;
serious crime: offense punishable by at least four years in prison; and,
structured group: Not randomly formed but doesn’t need formal structure,
Others stress the importance of power, profit and perpetuity, defining organized criminal
behavior as:
nonideological: i.e., profit driven;
hierarchical: few elites and many operatives;
limited or exclusive membership: maintain secrecy and loyalty of members;
perpetuating itself: Recruitment process and policy;
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willing to use illegal violence and bribery;
specialized division of labor: to achieve organization goal;
monopolistic: Market control to maximize profits; and,
has explicit rules and regulations: Codes of honor.
Definitions need to bring together its legal and social elements. OC has widespread
social, political and economic effects. It uses violence and corruption to achieve its
ends: "OC when group primarily focused on illegal profits systematically commit crimes
that adversely affect society and are capable of successfully shielding their activities, in
particular by being willing to use physical violence or eliminate individuals by way of
corruption."
It is a mistake to use the term "OC" as though it denotes a clear and well-defined
phenomenon. The evidence regarding OC "shows a less well-organized, very diversified
landscape of organizing criminals…the economic activities of these organizing criminals
can be better described from the viewpoint of 'crime enterprises' than from a
conceptually unclear frameworks such as 'OC'." Many of the definitions emphasize the
‘group nature’ of OC, the ‘organization’ of its members, its use of violence or corruption
to achieve its goals, and its extra-jurisdictional character….OC may appear in many
forms at different times and in different places. Due to the variety of definitions, there is
“evident danger” in asking “what is OC?” and expecting a simple answer.
The Locus of Power and Organized Crime
Some espouse that all organized crime operates at an international level, though there
is currently no international court capable of trying offenses resulting from such activities
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(the International Criminal Court’s remit extends only to dealing with people accused of
offenses against humanity, e.g., genocide). If a network operates primarily from one
jurisdiction and carries out its illicit operations there and in some other jurisdictions it is
‘international,' though it may be appropriate to use the term ‘transnational’ only to label
the activities of a major crime group that is centered in no one jurisdiction but operating
in many. The understanding of organized crime has therefore progressed to combined
internationalization and an understanding of social conflict into one of power, control,
efficiency risk and utility, all within the context of organizational theory. The
accumulation of social, economic and political power have sustained themselves as a
core concerns of all criminal organizations:
social: criminal groups seek to develop social control in relation to particular
communities;
economic: seek to exert influence by means of corruption and by coercion of
legitimate and illegitimate praxis; and,
political: criminal groups use corruption and violence to attain power and status.
Contemporary organized crime may be very different from traditional Mafia style,
particularly in terms of the distribution and centralization of power, authority structures
and the concept of 'control' over one's territory and organization. There is a tendency
away from centralization of power and reliance upon family ties towards a fragmentation
of structures and informality of relationships in crime groups. Organized crime most
typically flourishes when a central government and civil society is disorganized, weak,
absent or untrusted.
This may occur in a society facing periods of political, economic or social turmoil or
transition, such as a change of government or a period of rapid economic development,
particularly if the society lacks strong and established institutions and the rule of law.
The dissolution of the Soviet Union and the Revolutions of 1989 in Eastern Europe that
saw the downfall of the Communist Bloc created a breeding ground for criminal
organizations.
The newest growth sectors for organized crime are identity theft and online extortion.
These activities are troubling because they discourage consumers from using the
Internet for e-commerce. E-commerce was supposed to level the playing ground
between small and large businesses, but the growth of online organized crime is leading
to the opposite effect; large businesses are able to afford more bandwidth (to resist
denial-of-service attacks) and superior security. Furthermore, organized crime using the
Internet is much harder to trace down for the police (even though they increasingly
deploy cybercops) since most police forces and law enforcement agencies operate
within a local or national jurisdiction while the Internet makes it easier for criminal
organizations to operate across such boundaries without detection.
In the past criminal organizations have naturally limited themselves by their need to
expand, putting them in competition with each other. This competition, often leading to
violence, uses valuable resources such as manpower (either killed or sent to prison),
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equipment and finances. In the United States, James "Whitey" Bulger, the Irish Mob
boss of the Winter Hill Gang in Boston turned informant for the Federal Bureau of
Investigation (FBI). He used this position to eliminate competition and consolidate
power within the city of Boston which led to the imprisonment of several senior
organized crime figures including Gennaro Angiulo, underboss of the Patriarca crime
family. Infighting sometimes occurs within an organization, such as the Castellamarese
war of 1930–31 and the Boston Irish Mob Wars of the 1960s and 1970s.
Today criminal organizations are increasingly working together, realizing that it is better
to work in cooperation rather than in competition with each other (once again,
consolidating power). This has led to the rise of global criminal organizations such as
Mara Salvatrucha, 18th Street gang, and Barrio Azteca. The American Mafia, in addition
to having links with organized crime groups in Italy such as the Camorra, the
'Ndrangheta, Sacra Corona Unita, and Sicilian Mafia, has at various times done
business with the Irish Mob, Jewish-American organized crime, the Japanese Yakuza,
Indian Mafia, the Russian Mafia, Thief in law, and Post-Soviet Organized crime groups,
the Chinese Triads, Chinese Tongs, and Asian street gangs, Motorcycle Gangs, and
numerous White, Black, and Hispanic prison and street gangs. The United Nations
Office on Drugs and Crime estimated that organized crime groups held $322 billion in
assets in 2005.
This rise in cooperation between criminal organizations has meant that law enforcement
agencies are increasingly having to work together. The FBI operates an organized
crime section from its headquarters in Washington, D.C. and is known to work with
other national (e.g., Polizia di Stato, Russian Federal Security Service (FSB), and the
Royal Canadian Mounted Police), federal (e.g., Bureau of Alcohol, Tobacco, Firearms,
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and Explosives, Drug Enforcement Administration, United States Marshals Service,
Immigration and Customs Enforcement, United States Secret Service, US Diplomatic
Security Service, United States Postal Inspection Service, U.S. Customs and Border
Protection, United States Border Patrol, and the United States Coast Guard), state (e.g.,
Massachusetts State Police Special Investigation Unit, New Jersey State Police
organized crime unit, Pennsylvania State Police organized crime unit, and the New York
State Police Bureau of Criminal Investigation) and city (e.g., New York City Police
Department Organized Crime Unit, Philadelphia Police Department Organized crime
unit, Chicago Police Organized Crime Unit, and the Los Angeles Police Department
Special Operations Division) law enforcement agencies.
Rational Choice
Theoretical Background
Criminal Psychology
This theory treats all individuals as rational operators, committing criminal acts after
consideration of all associated risks (detection and punishment) compared with the
rewards of crimes (personal, financial etc.). Little emphasis is placed on the offenders’
emotional state. The role of criminal organizations in lowering the perceptions of risk
and increasing the likelihood of personal benefit is prioritized by this approach, with the
organizations structure, purpose, and activity being indicative of the rational choices
made by criminals and their organizers.
Deterrence
This theory sees criminal behavior as reflective of an individual, internal calculation by
the criminal that the benefits associated with offending (whether financial or otherwise)
outweigh the perceived risks. The perceived strength, importance or infallibility of the
criminal organization is directly proportional to the types of crime committed, their
intensity and arguably the level of community response. The benefits of participating in
organized crime (higher financial rewards, greater socioeconomic control and influence,
protection of the family or significant others, perceived freedoms from 'oppressive' laws
or norms) contribute greatly to the psychology behind highly organized group offending.
Social Learning
Criminals learn through associations with one another. The success of organized crime
groups is therefore dependent upon the strength of their communication and the
enforcement of their value systems, the recruitment and training processes employed to
sustain, build or fill gaps in criminal operations. An understanding of this theory sees
close associations between criminals, imitation of superiors, and understanding of value
systems, processes and authority as the main drivers behind organized crime.
Interpersonal relationships define the motivations the individual develops, with the effect
of family or peer criminal activity being a strong predictor of inter-generational offending.
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This theory also developed to include the strengths and weaknesses of reinforcement,
which in the context of continuing criminal enterprises may be used to help understand
propensities for certain crimes or victims, level of integration into the mainstream culture
and likelihood of recidivism / success in rehabilitation.
Enterprise
Under this theory, organized crime exists because legitimate markets leave many
customers and potential customers unsatisfied. High demand for a particular good or
service (e.g., drugs, prostitution, arms, slaves), low levels of risk detection and high
profits lead to a conducive environment for entrepreneurial criminal groups to enter the
market and profit by supplying those goods and services. For success, there must be:
an identified market; and,
a certain rate of consumption (demand) to maintain profit and outweigh perceived
risks.
Under these conditions competition is discouraged, ensuring criminal monopolies
sustain profits. Legal substitution of goods or services may (by increasing competition)
force the dynamic of organized criminal operations to adjust, as will deterrence
measures (reducing demand), and the restriction of resources (controlling the ability to
supply or produce to supply).
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Differential Association
Sutherland goes further to say that deviancy is contingent on conflicting groups within
society, and that such groups struggle over the means to define what is criminal or
deviant within society. Criminal organizations therefore gravitate around illegal avenues
of production, profit-making, protectionism or social control and attempt (by increasing
their operations or membership) to make these acceptable. This also explains the
propensity of criminal organizations to develop protection rackets, to coerce through the
use of violence, aggression and threatening behavior (at times termed 'terrorism').
Preoccupation with methods of accumulating profit highlight the lack of legitimate
means to achieve economic or social advantage, as does the organization of whitecollar
crime or political corruption (though it is debatable whether these are based on
wealth, power or both). The ability to effect social norms and practices through political
and economic influence (and the enforcement or normalization of criminogenic needs)
may be defined by differential association theory.
Social Disorganization
Critical Criminology and Sociology
Social disorganization theory is intended to be applied to neighborhood level street
crime, thus the context of gang activity, loosely formed criminal associations or
networks, socioeconomic demographic impacts, legitimate access to public resources,
employment or education, and mobility give it relevance to organized crime. Where the
upper- and lower-classes live in close proximity this can result in feelings of anger,
hostility, social injustice and frustration. Criminals experience poverty; and witness
affluence they are deprived of and which is virtually impossible for them to attain
through conventional means. The concept of neighborhood is central to this theory, as it
defines the social learning, locus of control, cultural influences and access to social
opportunity experienced by criminals and the groups they form. Fear of or lack of trust in
mainstream authority may also be a key contributor to social disorganization; organized
crime groups replicate such figures and thus ensure control over the counter-culture.
This theory has tended to view violent or anti-social behavior by gangs as reflective of
their social disorganization rather than as a product or tool of their organization.
Anomie
Sociologist Robert K. Merton believed deviance depended on society’s definition of
success, and the desires of individuals to achieve success through socially defined
avenues. Criminality becomes attractive when expectations of being able to fulfill goals
(therefore achieving success) by legitimate means cannot be fulfilled. Criminal
organizations capitalize on states of normlessness by imposing criminogenic needs and
illicit avenues to achieve them. This has been used as the basis for numerous metatheories
of organized crime through its integration of social learning, cultural deviance,
and criminogenic motivations. If crime is seen as a function of anomie, organized
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ehavior produces stability, increases protection or security, and may be directly
proportional to market forces as expressed by entrepreneurship- or risk-based
approaches. It is the inadequate supply of legitimate opportunities that constrains the
ability for the individual to pursue valued societal goals and reduces the likelihood that
using legitimate opportunities will enable them to satisfy such goals (due to their
position in society).
Cultural Deviance
Criminals violate the law because they belong to a unique subculture - the counterculture
- their values and norms conflicting with those of the working-, middle- or upperclasses
upon which criminal laws are based. This subculture shares an alternative
lifestyle, language and culture, and is generally typified by being tough, taking care of
their own affairs and rejecting government authority. Role models include drug dealers,
thieves and pimps, as they have achieved success and wealth not otherwise available
through socially-provided opportunities. It is through modeling organized crime as a
counter-cultural avenue to success that such organizations are sustained.
Alien Conspiracy/Queer Ladder of Mobility
The alien conspiracy theory and queer ladder of mobility theories state that ethnicity and
'outsider' status (immigrants, or those not within the dominant ethnocentric groups) and
their influences are thought to dictate the prevalence of organized crime in society. The
alien theory posits that the contemporary structures of organized crime gained
prominence during the 1860s in Sicily and that elements of the Sicilian population are
responsible for the foundation of most European and North American organized crime,
made up of Italian-dominated crime families. Bell's theory of the 'queer ladder of
mobility' hypothesized that 'ethnic succession' (the attainment of power and control by
one more marginalized ethnic group over other less marginalized groups) occurs by
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promoting the perpetration of criminal activities within a disenfranchised or oppressed
demographic. Whilst early organized crime was dominated by the Irish Mob (early
1800s), they were relatively substituted by the Sicilian Mafia and Italian-American Mafia,
the Aryan Brotherhood (1960s onwards), Colombian Medellin cartel and Cali cartel
(mid-1970s - 1990s), and more recently the Mexican Tijuana Cartel (late 1980s
onwards), Mexican Los Zetas (late 1990s to onwards), the Russian Mafia (1988
onwards), terrorism-related organized crime Al-Qaeda (1988 onwards), the Taliban
(1994 onwards), and Islamic State of Iraq and the Levant (ISIL) (2010s to onwards).
Many argue this misinterprets and overstates the role of ethnicity in organized crime. A
contradiction of this theory is that syndicates had developed long before large-scale
Sicilian immigration in 1860s, with these immigrants merely joining a widespread
phenomenon of crime and corruption.
Legislative Frameworks and Policing Measures
International
Convention against Transnational Organized Crime (the 'Palermo Convention') -
the international treaty against organized crime; includes the Protocol to Prevent,
Suppress and Punish Trafficking in Persons, especially Women and Children and
the Protocol against the Smuggling of Migrants by Land, Sea and Air
Canada
India
Criminal Code, RSC 1985, c C-46, ss 467.1 to 467.2.
Maharashtra Control of Organised Crime Act
Republic of Ireland
Criminal Assets Bureau
Italy
Article 41-bis prison regime
United Kingdom
Serious Organized Crime and Police Act 2005
United States
Federal Anti-Racketeering Act (the 'Hobbs Act') 1946
Federal Wire Act 1961
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Bank Secrecy Act 1970
Organized Crime Control Act 1970
Title 21 of the United States Code 1970
Continuing Criminal Enterprise (contemporary)
Racketeer Influenced and Corrupt Organizations Act (the 'RICO Act') 1970
Money Laundering Control Act 1986
United States Patriot Act 2001
Fraud Enforcement and Recovery Act of 2009
By nation
List of criminal enterprises, gangs and syndicates
Organized crime in Afghanistan
Organized crime in Albania
Organized crime in Australia
Organized crime in Brazil
Organized crime in Bulgaria
Category: Organized crime in Canada
Organized crime in China
Organized crime in France
Organized crime in Greece
Organized crime in India
Organized crime in Ireland
Organized crime in Italy
Organized crime in Japan
Organized crime in Kenya
Organized crime in Kyrgyzstan
Organized crime in Lebanon
Organized crime in the Netherlands
Organized crime in Nigeria
Organized crime in Pakistan
Organized crime in Russia
Organized crime in South Korea
Organized crime in Sweden
Organized crime in Turkey
Organized crime in Ukraine
Organized crime in the United Kingdom
Category: Organized crime in the United States
Organized crime in Vietnam
________
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White Collar Crime
White-Collar Crime (or corporate crime, more correctly) refers to financially motivated,
nonviolent crime committed by businesses and government professionals. It was first
defined by sociologist Edwin Sutherland in 1939 as "a crime committed by a person of
respectability and high social status in the course of their occupation". Typical whitecollar
crimes could include wage theft, fraud, bribery, Ponzi schemes, insider
trading, labor racketeering, embezzlement, cybercrime, copyright infringement, money
laundering, identity theft, and forgery. Lawyers can specialize in white-collar crime.
Definitional Issues
Modern criminology generally rejects a limitation of the term by reference, rather it
classifies the type of crime and the topic:
By the type of offense, e.g., property crime, economic crime, and other corporate
crimes like environmental and health and safety law violations. Some crime is
only possible because of the identity of the offender, e.g., transnational money
laundering requires the participation of senior officers employed in banks. But
the FBI has adopted the narrow approach, defining white-collar crime as "those
illegal acts which are characterized by deceit, concealment, or violation of trust
and which are not dependent upon the application or threat of physical force or
violence" (1989, 3). While the true extent and cost of white-collar crime are
unknown, the FBI and the Association of Certified Fraud Examiners estimate the
annual cost to the United States to fall between $300 and $660 billion.
By the type of offender, e.g., by social class or high socioeconomic status, the
occupation of positions of trust or profession, or academic qualification,
researching the motivations for criminal MAFIA behavior, e.g., greed or fear of
loss of face if economic difficulties become obvious. Shover and Wright point to
the essential neutrality of a crime as enacted in a statute. It almost inevitably
describes conduct in the abstract, not by reference to the character of the
persons performing it. Thus, the only way that one crime differs from another is in
the backgrounds and characteristics of its perpetrators.
By organizational culture rather than the offender or offense which overlaps
with organized crime. Appelbaum and Chambliss offer a twofold definition:
Occupational crime which occurs when crimes are committed to promote
personal interests, say, by altering records and overcharging, or by the
cheating of clients by professionals.
Organizational or corporate crime which occurs when corporate
executives commit criminal acts to benefit their company by overcharging
or price fixing, false advertising, etc.
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Relationship to Other Types of Crime
Blue-Collar Crime
The types of crime committed are a function of what is available to the potential
offender. Thus, those employed in relatively unskilled environments have fewer
opportunities to exploit than those who work in situations where large financial
transactions occur. Blue-collar crime tends to be more obvious and thus attracts more
active police attention such as vandalism or shoplifting. In contrast, white-collar
employees can incorporate legitimate and criminal behavior, thus making themselves
less obvious when committing the crime. Therefore, blue-collar crime will more often
use physical force, whereas in the corporate world, the identification of a victim is less
obvious and the issue of reporting is complicated by a culture of commercial
confidentiality to protect shareholder value. It is estimated that a great deal of whitecollar
crime is undetected or, if detected, it is not reported.
Corporate
Crime
Corporate
crime deals
with the
company as
a whole. The
crime
benefits the
investors or
the individuals who are in high positions in the company or corporation. White-collar
crime and corporate crime are similar because they take place within the business
world. The difference is that white-collar crime benefits the individual(s) involved, and
corporate crime benefits the company or the corporation.
One well-known insider trading case in the United States is the ImClone stock trading
case. In December 2001, top-level executives sold their shares in ImClone Systems, a
pharmaceutical company that manufactured an anti-cancer drug.
The U.S. Securities and Exchange Commission (SEC) investigated numerous top-level
executives, as well as Martha Stewart, a friend of ImClone's former chief executive who
had also sold her shares at the same time. The SEC reached a settlement in 2005.
State-Corporate Crime
The negotiation of agreements between a state and a corporation will be at a relatively
senior level on both sides, this is almost exclusively a white-collar "situation" which
offers the opportunity for crime. Although law enforcement claims to have prioritized
white-collar crime, evidence shows that it continues to be a low priority.
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When senior levels of a corporation engage in criminal activity using the company this is
sometimes called control fraud.
Organized Transnational Crime
Organized transnational crime is organized criminal activity that takes place across
national jurisdictions, and with advances in transportation and information technology,
law enforcement officials and policymakers have needed to respond to this form of
crime on a global scale. Some examples include human trafficking, money
laundering, drug smuggling, illegal arms dealing, terrorism, and cybercrime. Although it
is impossible to precisely gauge transnational crime, the Millennium Project, an
international think tank, assembled statistics on several aspects of transnational crime
in 2009:
World illicit trade of almost $780 billion
Counterfeiting and piracy of $300 billion to $1 trillion
Global drug trade of $321 billion
Occupational Crime
Individuals may commit crime during employment or unemployment. The two most
common forms are theft and fraud. Theft can be of varying degrees, from a pencil to
furnishings to a car. Insider trading, the trading of stock by someone with access to
publicly unavailable information, is a type of fraud.
Crimes Related To National Interests
In the modern world, there are a lot of nations which divide the crimes into some laws.
"Crimes Related to Inducement of Foreign Aggression" is the crime of communicating
with aliens secretly to cause foreign aggression or menace.
"Crimes Related to Foreign Aggression" is the treason of cooperating with foreign
aggression positively regardless of the national inside and outside. "Crimes Related to
Insurrection" is the internal treason. Depending on a country, conspiracy is added to
these. One example is Jho Low, a mega thief and traitor who stole billions in USA
currency from a Malaysian government fund and is now on a run as a fugitive.
Demographics
According to a 2016 study,
A considerable percentage of white-collar offenders are gainfully employed middle-aged
Caucasian men who usually commit their first whitecollar offense sometime between their late
thirties through their mid-forties and appear to have middle-class backgrounds. Most have some
higher education, are married, and have moderate to strong ties to community, family, and
religious organizations. White collar offenders usually have a criminal history, including infractions
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that span the spectrum of illegality, but many do not overindulge in vice. Recent research
examining the five-factor personality trait model determined that white-collar offenders tend to be
more neurotic and less agreeable and conscientious than their non-criminal counterparts.
Punishment
In the United States, sentences for white-collar crimes may include a combination
of imprisonment, fines, restitution, community service, disgorgement, probation, or other
alternative punishment. These punishments grew harsher after the Jeffrey
Skilling and Enronscandal, when the Sarbanes–Oxley Act of 2002 was passed by
the United States Congress and signed into law by President George W. Bush, defining
new crimes and
increasing the
penalties for crimes
such as mail and wire
fraud. In other
countries, such
as China, white-collar
criminals can be given
the death penalty, yet
some countries have a
maximum of 10–25
years imprisonment.
Certain countries
like Canada consider
the relationship
between the parties to
be a significant feature
on sentence when
there is a breach of
trust component
involved. Questions
about sentencing
disparity in white-collar crime continue to be debated.
Although, white-collar crime poses a serious threat in today's society, it becomes
extremely difficult to identify. The FBI, concerned with identifying this type of offense,
collects annual statistical information on only three categories: fraud,
counterfeiting/forgery, and embezzlement. All other types of white-collar crime are listed
in an, "miscellaneous" category.
In the United States, the longest sentences for white-collar crimes have been for the
following: Sholam Weiss (845 years for racketeering, wire fraud and money laundering
in connection with the collapse of National Heritage Life Insurance Company); Norman
Schmidt and Charles Lewis (330 years and 30 years, respectively, for "high-yield
investment" scheme); Bernard Madoff (150 years for $65 billion fraud scheme);
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Frederick Brandau (55 years for $117 million Ponzi scheme); Eduardo Masferrer (30
years for accounting fraud); Chalana McFarland (30 years for mortgage fraud scheme);
Lance Poulsen (30 years for $2.9 billion fraud).
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II. Arms Trafficking
Arms Trafficking, also known as gunrunning, is the trafficking of contraband weapons
and ammunition. What constitutes legal trade in firearms varies widely, depending on
local and national laws.
The 1999 Report of the UN Panel of Governmental Experts on Small Arms provides a
more refined and precise definition, which has become internationally accepted. This
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distinguishes between small arms (revolvers and self-loading pistols, rifles and
carbines, submachine guns, assault rifles, and light machine guns), which are weapons
designed for personal use, and light weapons (heavy machine guns, hand-held underbarrel
and mounted grenade launchers, portable anti-aircraft guns, portable anti-tanks
guns, recoilless rifles, portable launchers of anti-aircraft missile systems, and mortars of
calibres less than 100 mm), which are designed for use by several persons serving as a
unit. Ammunition and explosives also form an integral part of small arms and light
weapons used in conflict.
Areas
Impact
Although arms trafficking is widespread in regions of political turmoil, it is not limited to
such areas, and for example, in South Asia, an estimated 63 million guns have been
trafficked into India and Pakistan.
The suppression of gunrunning is one of the areas of increasing interest in the context
of international law. Examples of past and current gunrunning include:
Iran–Contra affair
Larne gun-running
Provisional Irish Republican Army arms importation
In the United States, the term "Iron Pipeline" is sometimes used to describe Interstate
Highway 95 and its connector highways as a corridor for arms trafficking into New York
City.
Africa
Liberia and Sierra Leone Conflict
The civil war in Sierra Leone lasted from 1991-2002, and left 75,000 people dead. Arms
Trafficking played a significant role in this conflict. Both small and large arms were
shipped to all sides in both Sierra Leone, and Liberia from outside actors. Small arms
being any handheld gun (pistol, assault rifle, sub machine gun, shotgun,) and other
items such as grenades, claymores, knives, machetes, etc. Large arms indicates large
amounts of explosives, missiles, light machine guns, mortars, anti tank missiles, tanks,
planes, etc. During this time a civil war was occurring in nearby Liberia. The Liberian
Civil War took place from 1989 through 1997. The war was between the existing
government and the National Patriotic Front. Leader of the National Patriotic front of
Liberia, Charles Taylor, helped to create the Revolutionary United Front (RUF) in Sierra
Leone. Taylor was the recipient of thousands of illegally trafficked arms from easter
Europe (mostly the Ukraine). Taylor then sold some of these weapons to the RUF in
exchange for diamonds. President of Burkina Faso, Blaise Compaore, “directly
facilitated Liberia’s arms-for-diamonds trade” with Liberia and Sierra Leone. Compaore
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would give guns to Taylor, who would then sell them to the RUF in exchange for
diamonds. These blood diamonds would then be sold back to Compaore for more
guns. The cyclical exchange allowed Compaore the ability to deny directly sending arms
to Sierra Leone.
The Liberian government received arms through an elaborate from company in
Guinea. The arms were intended to be shipped (legally) from Uganda to Slovakia,
however, the arms were diverted to Guinea as a par of “an elaborate bait and switch.”
Additionally the British government “encouraged Sandline International, a private
security firm and non state entity, to supply arms and ammunitions to the loyal forces of
the exiled government of President Kabbah.” Sandline proceeded 35 tons of arms from
Bulgaria, to Kabbah’s forces.
Why Traffickers Choose Africa
Kimberly Thachuk and Karen
Saunders argue that arms
trafficking is no different from any
other illegal business in their
work Under the Radar: Airborne
Arms Trafficking Operations in
Africa. Traffickers first need a
headquarters, or somewhere to
base their operations. A
headquarters needs several
aspects to make it an ideal place
to traffic weapons. First, the
headquarters should have
appropriate infrastructure. For a
weapons trafficking this would
include a landing strip for both
importation and exportation.
Additionally, warehouses are
needed to “store product
awaiting delivery." Once the
product has arrived and been
stored it needs to be delivered to
the customer, thus, the
headquarters should be in
somewhat of a central location
near each customer. This is not
the primary reason many
traffickers choose Africa certainly
has multitudes of unoccupied land that can be used by traffickers, as is asserted by
Thachuk and Saunders.
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Physical space is important but the rules and regulations of said space are also
relevant. Traffickers look for places with corrupt, supply side, officials that can either be
bribed, or blackmailed. This allows the trafficker to “circumvent the regulatory and
oversight systems” put in place by the government. Furthermore, a “lax financial
system” is key so the large amounts of money moved by the trafficker are not seen as
suspicious.
Thachuk and Saunders finish their argument, a stable, and highly centralized
government, is important. They then point out that 10 different African countries have
leaders that have been in power for more than 20 years, which they argue meets the
criteria a highly centralized and stable government.
Market Value
The total value of the global arms market is estimated around $60 billion a year, with
around $8 billion attributed to pistols, rifles, machine guns, and bullets. The total illegal
arms trade is harder to estimate, but the illicit small arms market has been estimated at
10–20% of the total global arms trade.
Notable Arms Dealers
Ali Fayad
Monzer al-Kassar
Pierre Beaumarchais
Viktor Bout
Samuel Cummings
Arcadi Gaydamak
Adnan Khashoggi
Leonid Minin
Sarkis Soghanalian
Dale Stoffel
Gerhard Mertins
John Nardi
Basil Zaharoff
Efraim Diveroli
In Popular Culture
Film
Lord of War (2005), a fictional crime war film in which Nicolas Cage plays an
illegal arms dealer similar to the post-Soviet arms dealer Viktor Bout; the film was
endorsed by Amnesty International for highlighting the arms trafficking by the
international arms industry
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Making a Killing: Inside the International Arms Trade (2006), a 15-minute
documentary included in the two-Disc Special Edition DVD of Lord of War (2005).
Numerous other documentaries about arms trafficking are linked on this film's
YouTube page.
Iron Man (2008), a superhero film in which based on the Marvel Comics
character of the same name, centering inventor Tony Stark (Robert Downey Jr.)
discovers his company has been arms trafficking weapons of his own designs to
criminals worldwide, and seeks to stop his corrupt executives and other
employees by becoming the technologically advanced superhero Iron Man.
War Dogs (2016), a black
comedy-drama biographical
film based on the true story
of two young men, David
Packouz and Efraim Diveroli,
who won a $300 million
contract from the Pentagon
to arm America's allies in
Afghanistan who later
became involved in arms
trafficking.
Shot Caller (2017), a crime
thriller in which recently
paroled felon Jacob "Money"
Harlon, is forced by his gang
shot caller to orchestrate a
major arms deal with an
allied Sureno gang.
The Chosen (1981), in one scene, Reuven, an Orthodox Jew in 1940's New
York, and some classmates are seen smuggling into the docks at New York
Harbor and placing crates full of rifles labeled "Farm Equipment" on a ship bound
for Haifa for the Israeli guerrilla fighters in the Arab-Israeli War. This scene also
occurs in the book on which the movie is based.
Television
Sons of Anarchy, a FX-TV series about a fictional outlaw motorcycle club whose
main source of income is trafficking arms to a variety of criminal enterprises
domestically and internationally.
Death in Paradise Series 3, Episode 5, features Simon Shepherd as Jacob
Doran, Saint Marie's Minister for Commerce, who is later found out by Humphrey
Goodman to be a gunrunner.
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Jormungand, an anime television series based on the manga series by Keitarō
Takahashi, produced by White Fox, which addresses the issue of arms trafficking
in the Middle East and throughout the European continent.
The Night Manager, a BBC miniseries where a former British soldier who is
currently a night manager in hotels infiltrates the inner circle of an arms dealer.
Video Games
Grand Theft Auto V's multiplayer platform, GTA Online, has a downloadable
content pack revolving around manufacturing and distributing illegal arms
through smuggling operations and missions included in "Gunrunning".
Mafia III, one of Lincoln Clay's underbosses, Haitian crime lord Cassandra, runs
gun rackets.
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III. Bribery
Bribery is the act of giving or receiving something of value in exchange for some kind of
influence or action in return, that the recipient would otherwise not offer. Bribery is
defined by Black's Law Dictionary as the offering, giving, receiving, or soliciting of any
item of value to influence the actions of an official or other person in charge of a public
or legal duty. Essentially, bribery is offering to do something for someone for the
expressed purpose of receiving something in exchange. Gifts of money or other items of
value which are otherwise available to everyone on an equivalent basis, and not for
dishonest purposes, is not bribery. Offering a discount or a refund to all purchasers is a
legal rebate and is not bribery. For example, it is legal for an employee of a Public
Utilities Commission involved in electric rate regulation to accept a rebate on electric
service that reduces their cost for electricity, when the rebate is available to other
residential electric customers. Giving the rebate to influence them to look favorably on
the electric utility's rate increase applications, however, would be considered bribery.
A bribe is the gift bestowed to influence the recipient's conduct. It may be money,
goods, rights in action, property, preferment, privilege, emolument, objects of value,
advantage, or merely a promise to induce or influence the action, vote, or influence of a
person in an official or public capacity.
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Forms
Many types of payments or favors can constitute bribes: tip, gift, sop, perk, skim, favor,
discount, waived fee/ticket, free food, free ad, free trip, free tickets, sweetheart deal,
kickback/payback, funding, inflated sale of an object or property, lucrative contract,
donation, campaign contribution, fundraiser, sponsorship/backing, higher paying job,
stock options, secret commission, or promotion (rise of position/rank).
One must be careful of differing social and cultural norms when examining bribery.
Expectations of when a monetary transaction is appropriate can differ from place to
place. Political campaign contributions in the form of cash, for example, are considered
criminal acts of bribery in some countries, while in the United States, provided they
adhere to election law, are legal. Tipping, for example, is considered bribery in some
societies, while in others the two concepts may not be interchangeable.
In some Spanish-speaking countries, bribes are referred to as "mordida" (literally,
"bite"). In Arab countries, bribes may be called baksheesh (a tip, gift, or gratuity) or
"shay" (literally, "tea"). French-speaking countries often use the expressions "dessousde-table"
("under-the-table" commissions), "pot-de-vin" (literally, "wine-pot"), or
"commission occulte" ("secret commission" or "kickback"). While the last two
expressions contain inherently a negative connotation, the expression "dessous-detable"
can be often understood as a commonly accepted business practice. In German,
the common term is Schmiergeld ("smoothing money").
The offence may be divided into two great classes: the one, where a person invested
with power is induced by payment to use it unjustly; the other, where power is obtained
by purchasing the suffrages of those who can impart it. Likewise, the briber might hold a
powerful role and control the transaction; or in other cases, a bribe may be effectively
extracted from the person paying it, although this is better known as extortion.
The forms that bribery take are numerous. For example, a motorist might bribe a police
officer not to issue a ticket for speeding, a citizen seeking paperwork or utility line
connections might bribe a functionary for faster service.
Bribery may also take the form of a secret commission, a profit made by an agent, in the
course of his employment, without the knowledge of his principal. Euphemisms abound
for this (commission, sweetener, kick-back etc.) Bribers and recipients of bribery are
likewise numerous although bribers have one common denominator and that is the
financial ability to bribe.
According to BBC news U.K, "bribery around the world is estimated at about $1 trillion
(£494bn)".
As indicated on the pages devoted to political corruption, efforts have been made in
recent years by the international community to encourage countries to dissociate and
incriminate as separate offences, active and passive bribery. From a legal point of view,
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active bribery can be defined for instance as the promising, offering or giving by any
person, directly or indirectly, of any undue advantage [to any public official], for himself
or herself or for anyone else, for him or her to act or refrain from acting in the exercise
of his or her functions. (article 2 of the Criminal Law Convention on Corruption (ETS
173) of the Council of Europe). Passive bribery can be defined as the request or receipt
[by any public official], directly or indirectly, of any undue advantage, for himself or
herself or for anyone else, or the acceptance of an offer or a promise of such an
advantage, to act or refrain from acting in the exercise of his or her functions (article 3 of
the Criminal Law Convention on Corruption (ETS 173)).
The reason for this dissociation is to make
the early steps (offering, promising,
requesting an advantage) of a corrupt deal
already an offence and, thus, to give a clear
signal (from a criminal policy point of view)
that bribery is not acceptable. Besides, such
a dissociation makes the prosecution of
bribery offences easier since it can be very
difficult to prove that two parties (the bribegiver
and the bribe-taker) have formally
agreed upon a corrupt deal. Besides, there
is often no such formal deal but only a
mutual understanding, for instance when it is
common knowledge in a municipality that to
obtain a building permit one has to pay a
"fee" to the decision maker to obtain a
favorable decision.
Government
Article II, Section 4 of the United States
Constitution
A grey area may exist when payments to smooth transactions are made. United States
law is particularly strict in limiting the ability of businesses to pay for the awarding of
contracts by foreign governments; however, the Foreign Corrupt Practices Act contains
an exception for "grease payments"; very basically, this allows payments to officials in
order to obtain the performance of ministerial acts which they are legally required to do,
but may delay in the absence of such payment. In some countries, this practice is the
norm, often resulting from a developing nation not having the tax structure to pay civil
servants an adequate salary. Nevertheless, most economists regard bribery as a bad
thing because it encourages rent seeking behaviour. A state where bribery has become
a way of life is a kleptocracy.
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Recent evidence suggests that the act of bribery can have political consequences- with
citizens being asked for bribes becoming less likely to identify with their country, region
and/or tribal unit.
Tax Treatment
The tax status of bribes is an issue for governments since the bribery of government
officials impedes the democratic process and may interfere with good government. In
some countries, such bribes are considered tax-deductible payments. However, in
1996, in an effort to discourage bribery, the OECD Council recommended that member
countries cease to allow the tax-deductibility of bribes to foreign officials. This was
followed by the signing of the Anti-Bribery Convention [7] . Since that time, the majority of
the OECD countries which are signatories of the convention have revised their tax
policies according to this recommendation and some have extended the measures to
bribes paid to any official, sending the message that bribery will no longer be tolerated
in the operations of the government.
As any monetary benefit received from an illegal activity such as bribery is generally
considered part of one's taxable income, however, as its criminal, some governments
may refuse to accept it as income as it may mean they are a party to the activity.
Medicine
Pharmaceutical corporations may seek to entice doctors to favor prescribing their drugs
over others of comparable effectiveness. If the medicine is prescribed heavily, they may
seek to reward the individual through gifts. The American Medical Association has
published ethical guidelines for gifts from industry which include the tenet that
physicians should not accept gifts if they are given in relation to the physician's
prescribing practices. Doubtful cases include grants for traveling to medical conventions
that double as tourist trips.
Dentists often receive samples of home dental care products such as toothpaste, which
are of negligible value; somewhat ironically, dentists in a television commercial will often
state that they get these samples but pay to use the sponsor's product.
In countries offering state-subsidized or nationally funded healthcare where medical
professionals are underpaid, patients may use bribery to solicit the standard expected
level of medical care. For example, in many formerly Communist countries from what
used to be the Eastern Bloc it may be customary to offer expensive gifts to doctors and
nurses for the delivery of service at any level of medical care in the non-private health
sector.
Politics
Politicians receive campaign contributions and other payoffs from powerful corporations,
organizations or individuals in return for making choices in the interests of those parties,
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or in anticipation of favorable policy, also referred to as lobbying. This is not illegal in the
United States and forms a major part of campaign finance, though it is sometimes
referred to as the money loop. However, in many European countries, a politician
accepting money from a corporation whose activities fall under the sector they currently
(or are campaigning to be elected to) regulate would be considered a criminal offence,
for instance the "Cash-for-questions affair" and "Cash for Honors" in the United
Kingdom. A grey area in these democracies is the so-called "revolving door", whereby
politicians are offered highly-paid, often consultancy jobs upon their retirement from
politics by the corporations they regulate while in office, in return for enacting legislation
favorable to the corporation whilst in office – a conflict of interest. Convictions for this
form of bribery are easier to obtain with hard evidence, that is a specific amount of
money linked to a specific action by the recipient of the bribe. Such evidence is
frequently obtained using undercover agents, since evidence of a quid pro quo relation
can often be difficult to prove. See also influence peddling and political corruption.
Recent evidence suggests that demands for bribes can adversely impact citizen level of
trust and engagement with the political process.
Business
Employees, managers, or salespeople of a business may offer money or gifts to a
potential client in exchange for business.
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For example, in 2006, German prosecutors conducted a wide-ranging investigation of
Siemens AG to determine if Siemens employees paid bribes in exchange for business.
In some cases where the system of law is not well-implemented, bribes may be a way
for companies to continue their businesses. In the case, for example, custom officials
may harass a certain firm or production plant, officially stating they are checking for
irregularities, halting production or stalling other normal activities of a firm. The
disruption may cause losses to the firm that exceed the amount of money to pay off the
official. Bribing the officials is a common way to deal with this issue in countries where
there exists no firm system of reporting these semi-illegal activities. A third party, known
as a White Glove, may be involved to act as a clean middleman.
Specialist consultancies have been set up to help multinational companies and small
and medium enterprises with a commitment to anti-corruption to trade more ethically
and benefit from compliance with the law.
Contracts based on or involving the payment or transfer of bribes ("corruption money",
"secret commissions", "pots-de-vin", "kickbacks") are void.
In 2012, The Economist noted:
Bribery would be less of a problem if it wasn't also a solid investment. A new paper by
Raghavendra Rau of Cambridge University and Yan Leung Cheung and Aris Stouraitis
of the Hong Kong Baptist University examines 166 high-profile cases of bribery since
1971, covering payments made in 52 countries by firms listed on 20 different stock
markets. Bribery offered an average return of 10 to 11 times the value of the bung paid
out to win a contract, measured by the jump in stock market value when the contract
was won. America's Department of Justice found similarly high returns in cases it has
prosecuted.
In addition, a survey conducted by auditing firm Ernst & Young (EY) in 2012 found that
15 percent of top financial executives are willing to pay bribes in order to keep or win
business. Another 4 percent said they would be willing to misstate financial
performance. This alarming indifference represents a huge risk to their business, given
their responsibility.
Sport Corruption
Referees and scoring judges may be offered money, gifts, or other compensation to
guarantee a specific outcome in an athletic or other sports competition. A well-known
example of this manner of bribery in the sport would be the 2002 Olympic Winter
Games figure skating scandal, where the French judge in the pairs competition voted for
the Russian skaters in order to secure an advantage for the French skaters in the ice
dancing competition.
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Additionally, bribes may be offered by cities in order to secure athletic franchises, or
even competitions, as happened with the 2002 Winter Olympics. It is common practice
for cities to "bid" against each other with stadiums, tax benefits, and licensing deals.
Legislation
Prevention
The U.S. introduced the Foreign Corrupt Practices Act in 1977 to address bribery of
foreign officials. The Foreign Corrupt Practices Act, or FCPA, was introduced to prevent
the influencing of foreign officials by companies through rewards or payments. This
legislation dominated international anti-corruption enforcement until around 2010 when
other countries began introducing broader and more robust legislation, notably the
United Kingdom Bribery Act 2010. The International Organization for Standardization
introduced an international anti-bribery management system standard in 2016. In recent
years, cooperation in enforcement action between countries has increased.
Under 18 U.S. Code § 201 – Bribery of public officials and witnesses, the law strictly
prohibits any type of promising, giving, or offering of value to a public official. A public
official is further defined as anyone who holds public or elected office. Another
stipulation of the law in place condemns the same kind of offering, giving, or coercing a
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witness in a legal case to changing their story. The minimum penalty for either of these
offenses is 10 years, and a potential fine.
Businesses
Programs of prevention need to be properly designed and meet with international
standards of best practice. To ensure respect for a program, whether it be on the part of
employees or business partners, external verification is necessary. International best
practices such as the Council for Further Combating Bribery of Foreign Public Officials
in International Business Transactions, Annex 2; the ISO 26000 norm (section 6.6.3) or
TI Business Principles for Countering Bribery are used in external verification processes
to measure and ensure that a program of bribery prevention works and is consistent
with international standards. Another reason for businesses to undergo external
verification of their bribery prevention programs is that it means evidence can be
provided to assert that all that was possible was done to prevent corruption. Companies
are unable to guarantee corruption has never occurred; what they can do is provide
evidence that they did their best to prevent it.
There is no federal statute under the U.S Law that prohibits or regulates any type of
private or commercial bribery. There is a way for prosecutors to try people for bribery by
using existing laws. Section 1346 of Title 18 can be used by prosecutors, to try people
for ‘a scheme or artifice to deprive another of the intangible right to honest services,’
under the mail and wire fraud statutes. Prosecutors have always successfully
prosecuted private company employees for breaching a fiduciary duty and taking bribes,
under Honest services fraud.
There are also cases of successful prosecution of bribery in the case of international
business. The DOJ has used the Travel Act, 18 USC Section 1952 to prosecute bribery.
Under the Travel Act, it is against the law, domestically and internationally, to utilize‘the
mail or any facility in interstate or foreign commerce’ with intent to ‘promote, manage,
establish, carry on, or facilitate the promotion, management, establishment or carrying
on, of any unlawful activity’.
Notable Instances
Spiro Agnew, American Vice President who resigned from office in the aftermath
of discovery that he took bribes while serving as Governor of Maryland.
Duke Cunningham, United States Navy veteran and former Republican member
of the United States House of Representatives from California's 50th
Congressional District resigned after pleading guilty to accepting at least
$2.4 million in bribes and under-reporting his income for 2004.
Gerald Garson, former New York Supreme Court Justice, convicted of accepting
bribes to manipulate outcomes of divorce proceedings.
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Andrew J. Hinshaw, Republican, former congressman from California's 40th
district, convicted of accepting bribes.
John Jenrette, Democrat, former congressman from South Carolina's 6th district,
convicted of accepting a bribe in the FBI's Abscam operation.
Donald "Buz" Lukens, Republican, former congressman from Ohio's 8th district,
charged with delinquency of a minor and convicted of bribery and conspiracy.
Martin Thomas Manton, former U.S. federal judge convicted of accepting bribes.
Rick Renzi, Republican, former congressman from Arizona's 1st district, found
guilty of 17 counts including wire fraud, conspiracy, extortion, racketeering, and
money laundering.
Dianne Wilkerson, Democrat, former Massachusetts state senator pleaded guilty
to eight counts of attempted extortion.
Lee Myung-Bak, former South Korean president was found guilty of accepting
nearly $6 million bribes from Samsung in exchange for a presidential pardon for
Samsung Chairman Lee Kun-hee.
Pakistan cricket spot-fixing controversy, Mohammad Asif, Mohammad Amir and
Salman Butt, Pakistani cricketers found guilty of accepting bribes to bowl no-balls
against England at certain times.
Tangentopoli (Italian for "city of bribes") was a huge bribery scandal in early
1990s Italy, which brought down the whole system of political parties, when it
was uncovered by the Mani pulite investigations. At one point roughly half of
members of parliament were under investigation.
Ralph Lauren, clothing retailer, was found guilty of making illegal payments and
giving gifts to foreign officials in an attempt to circumvent custom' inspections and
paperwork.
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IV. Cybercrime
Cybercrime, or computer-oriented crime, is the crime that involves a computer and a
network. The computer may have been used in the commission of a crime, or it may be
the target. Cybercrimes can be defined as: "Offences that are committed against
individuals or groups of individuals with a criminal motive to intentionally harm the
reputation of the victim or cause physical or mental harm, or loss, to the victim directly
or indirectly, using modern telecommunication networks such as Internet (networks
including chat rooms, emails, notice boards and groups) and mobile phones
(Bluetooth/SMS/MMS)". Cybercrime may threaten a person or a nation's security and
financial health. Issues surrounding these types of crimes have become high-profile,
particularly those surrounding hacking, copyright infringement, unwarranted masssurveillance,
sextortion, child pornography, and child grooming. There are also
problems of privacy when confidential information is intercepted or disclosed, lawfully or
otherwise. Debarati Halder and K. Jaishankar further define cybercrime from the
perspective of gender and defined 'cybercrime against women' as "Crimes targeted
against women with a motive to intentionally harm the victim psychologically and
physically, using modern telecommunication networks such as internet and mobile
phones". Internationally, both governmental and non-state actors engage in
cybercrimes, including espionage, financial theft, and other cross-border crimes.
Cybercrimes crossing international borders and involving the actions of at least one
nation state is sometimes referred to as cyberwarfare.
A report (sponsored by McAfee), published in 2014, estimated that the annual damage
to the global economy was $445 billion. Approximately $1.5 billion was lost in 2012 to
online credit and debit card fraud in the US. In 2018, a study by Center for Strategic and
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International Studies (CSIS), in partnership with McAfee, concludes that close to $600
billion, nearly one percent of global GDP, is lost to cybercrime each year.
Classifications
Computer crime encompasses a broad range of activities.
Financial Fraud Crimes
Computer fraud is any dishonest misrepresentation of fact intended to let another to do
or refrain from doing something which causes loss. In this context, the fraud will result in
obtaining a benefit by:
Altering in an unauthorized way. This requires little technical expertise and is
common form of theft by employees altering the data before entry or entering
false data, or by entering unauthorized instructions or using unauthorized
processes;
Altering, destroying, suppressing, or stealing output, usually to conceal
unauthorized transactions. This is difficult to detect;
Altering or deleting stored data;
Other forms of fraud may be facilitated using computer systems, including bank fraud,
carding, identity theft, extortion, and theft of classified information.
Cyber-terrorism
Government officials and information technology security specialists have documented
a significant increase in Internet problems and server scans since early 2001. But there
is a growing concern among government agencies such as the Federal Bureau of
Investigations (FBI) and the Central Intelligence Agency (CIA) that such intrusions are
part of an organized effort by cyberterrorists, foreign intelligence services, or other
groups to map potential security holes in critical systems.
A cyberterrorist is someone who intimidates or coerces a government or an organization
to advance his or her political or social objectives by launching a computer-based attack
against computers, networks, or the information stored on them.
Cyberterrorism in general can be defined as an act of terrorism committed through the
use of cyberspace or computer resources (Parker 1983). As such, a simple propaganda
piece in the Internet that there will be bomb attacks during the holidays can be
considered cyberterrorism. There are also hacking activities directed towards
individuals, families, organized by groups within networks, tending to cause fear among
people, demonstrate power, collecting information relevant for ruining peoples' lives,
robberies, blackmailing etc.
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Cyber-Extortion
Cyber-extortion occurs when a website, e-mail server, or computer system is subjected
to or threatened with repeated denial of service or other attacks by malicious hackers.
These hackers demand money in return for promising to stop the attacks and to offer
"protection". According to the Federal Bureau of Investigation, cybercrime extortionists
are increasingly attacking corporate websites and networks, crippling their ability to
operate and demanding payments to restore their service. More than 20 cases are
reported each month to the FBI and many go unreported in order to keep the victim's
name out of the public domain. Perpetrators typically use a distributed denial-of-service
attack. However, other cyber-extortion techniques exist such as doxing extortion and
bug poaching.
An example of cyber-extortion was the attack on Sony Pictures of 2014.
Cyberwarfare
The U.S. Department of Defense (DoD) notes that the cyberspace has emerged as a
national-level concern through several recent events of geostrategic significance.
Among those are included, the attack on Estonia's infrastructure in 2007, allegedly by
Russian hackers. "In August 2008, Russia again allegedly conducted cyberattacks, this
time in a coordinated and synchronized kinetic and non-kinetic campaign against the
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country of Georgia. The December 2015 Ukraine power grid cyberattack has also been
attributed to Russia and is considered the first successful cyberattack on a power grid.
Fearing that such attacks may become the norm in future warfare among nation-states,
the concept of cyberspace operations impacts and will be adapted by warfighting
military commanders in the future.
Computer As a Target
These crimes are committed by a selected group of criminals. Unlike crimes using the
computer as a tool, these crimes require the technical knowledge of the perpetrators. As
such, as technology evolves, so too does the nature of the crime. These crimes are
relatively new, having been in existence for only as long as computers have—which
explains how unprepared society and the world in general is towards combating these
crimes. There are numerous crimes of this nature committed daily on the internet.
Crimes that primarily target computer networks or devices include:
Computer viruses
Denial-of-service attacks
Malware (malicious code)
Computer as A Tool
When the individual is the main target of cybercrime, the computer can be considered
as the tool rather than the target. These crimes generally involve less technical
expertise. Human weaknesses are generally exploited. The damage dealt is largely
psychological and intangible, making legal action against the variants more difficult.
These are the crimes which have existed for centuries in the offline world. Scams, theft,
and the likes have existed even before the development in high-tech equipment. The
same criminal has simply been given a tool which increases their potential pool of
victims and makes them all the harder to trace and apprehend.
Crimes that use computer networks or devices to advance other ends include:
Fraud and identity theft (although this increasingly uses malware, hacking or
phishing, making it an example of both "computer as target" and "computer as
tool" crime)
Information warfare
Phishing scams
Spam
Propagation of illegal obscene or offensive content, including harassment and
threats
The unsolicited sending of bulk email for commercial purposes (spam) is unlawful in
some jurisdictions.
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Phishing is mostly propagated via email. Phishing emails may contain links to other
websites that are affected by malware. Or, they may contain links to fake online banking
or other websites used to steal private account information.
Obscene or Offensive Content
The content of websites and other electronic communications may be distasteful,
obscene or offensive for a variety of reasons. In some instances these communications
may be illegal.
The extent to which these communications are unlawful varies greatly between
countries, and even within nations. It is a sensitive area in which the courts can become
involved in arbitrating between groups with strong beliefs.
One area of Internet pornography that has been the target of the strongest efforts at
curtailment is child pornography, which is illegal in most jurisdictions in the world.
Online Harassment
Whereas content may be offensive in a non-specific way, harassment directs
obscenities and derogatory comments at specific individuals focusing for example on
gender, race, religion, nationality, sexual orientation. This often occurs in chat rooms,
through newsgroups, and by sending hate e-mail to interested parties. Harassment on
the internet also includes revenge porn.
There are instances where committing a crime using a computer can lead to an
enhanced sentence. For example, in the case of United States v. Neil Scott Kramer,
Kramer was served an enhanced sentence according to the U.S. Sentencing Guidelines
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Manual §2G1.3(b)(3) for his use of a cell phone to "persuade, induce, entice, coerce, or
facilitate the travel of, the minor to engage in prohibited sexual conduct." Kramer argued
that this claim was insufficient because his charge included persuading through a
computer device and his cellular phone technically is not a computer. Although Kramer
tried to argue this point, U.S. Sentencing Guidelines Manual states that the term
computer "means an electronic, magnetic, optical, electrochemically, or other highspeed
data processing device performing logical, arithmetic, or storage functions, and
includes any data storage facility or communications facility directly related to or
operating in conjunction with such device."
Connecticut was the U.S. state to pass a statute making it a criminal offense to harass
someone by computer. Michigan, Arizona, and Virginia and South Carolina have also
passed laws banning harassment by electronic means.
Harassment as defined in the U.S. computer statutes is typically distinct from
cyberbullying, in that the former usually relates to a person's "use a computer or
computer network to communicate obscene, vulgar, profane, lewd, lascivious, or
indecent language, or make any suggestion or proposal of an obscene nature, or
threaten any illegal or immoral act," while the latter need not involve anything of a
sexual nature.
Although freedom of speech is protected by law in most democratic societies (in the US
this is done by the First Amendment), it does not include all types of speech. In fact
spoken or written "true threat" speech/text is criminalized because of "intent to harm or
intimidate", that also applies for online or any type of network related threats in written
text or speech. The US Supreme Court definition of "true threat" is "statements where
the speaker means to communicate a serious expression of an intent to commit an act
of unlawful violence to a particular individual or group".
Drug Trafficking
Darknet markets are used to buy and sell recreational drugs online. Some drug
traffickers use encrypted messaging tools to communicate with drug mules. The dark
web site Silk Road was a major online marketplace for drugs before it was shut down by
law enforcement (then reopened under new management, and then shut down by law
enforcement again). After Silk Road 2.0 went down, Silk Road 3 Reloaded emerged.
However, it was just an older marketplace named Diabolus Market, that used the name
for more exposure from the brand's previous success.
Documented Cases
One of the highest profiled banking computer crime occurred during a course of
three years beginning in 1970. The chief teller at the Park Avenue branch of New
York's Union Dime Savings Bank embezzled over $1.5 million from hundreds of
accounts.
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A hacking group called MOD (Masters of Deception), allegedly stole passwords
and technical data from Pacific Bell, Nynex, and other telephone companies as
well as several big credit agencies and two major universities. The damage
caused was extensive, one company, Southwestern Bell suffered losses of
$370,000 alone.
In 1983, a 19-year-old UCLA student used his PC to break into a Defense
Department International Communications system.
Between 1995 and 1998 the Newscorp satellite pay to view encrypted SKY-TV
service was hacked several times during an ongoing technological arms race
between a pan-European hacking group and Newscorp. The original motivation
of the hackers was to watch Star Trek reruns in Germany; which was something
which Newscorp did not have the copyright to allow.
On 26 March 1999, the Melissa worm infected a document on a victim's
computer, then automatically sent that document and a copy of the virus spread
via e-mail to other people.
In February 2000, an individual going by the alias of MafiaBoy began a series
denial-of-service attacks against high-profile websites, including Yahoo!, Dell,
Inc., E*TRADE, eBay, and CNN. About 50 computers at Stanford University, and
also computers at the University of California at Santa Barbara, were amongst
the zombie computers sending pings in DDoS attacks. On 3 August 2000,
Canadian federal prosecutors charged MafiaBoy with 54 counts of illegal access
to computers, plus a total of ten counts of mischief to data for his attacks.
The Stuxnet worm corrupted SCADA microprocessors, particularly of the types
used in Siemens centrifuge controllers.
The Russian Business Network (RBN) was registered as an internet site in 2006.
Initially, much of its activity was legitimate. But apparently, the founders soon
discovered that it was more profitable to host illegitimate activities and started
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hiring its services to criminals. The RBN has been described by VeriSign as "the
baddest of the bad". It offers web hosting services and internet access to all
kinds of criminal and objectionable activities, with individual activities earning up
to $150 million in one year. It specialized in and in some cases monopolized
personal identity theft for resale. It is the originator of MPack and an alleged
operator of the now defunct Storm botnet.
On 2 March 2010, Spanish investigators arrested 3 in infection of over 13 million
computers around the world. The "botnet" of infected computers included PCs
inside more than half of the Fortune 1000 companies and more than 40 major
banks, according to investigators.
In August 2010 the international investigation Operation Delego, operating under
the aegis of the Department of Homeland Security, shut down the international
pedophile ring Dreamboard. The website had approximately 600 members and
may have distributed up to 123 terabytes of child pornography (roughly
equivalent to 16,000 DVDs). To date this is the single largest U.S. prosecution of
an international child pornography ring; 52 arrests were made worldwide.
In January 2012 Zappos.com experienced a security breach after as many as 24
million customers' credit card numbers, personal information, billing and shipping
addresses had been compromised.
In June 2012 LinkedIn and eHarmony were attacked, compromising 65 million
password hashes. 30,000 passwords were cracked and 1.5 million EHarmony
passwords were posted online.
December 2012 Wells Fargo website experienced a denial of service attack.
Potentially compromising 70 million customers and 8.5 million active viewers.
Other banks thought to be compromised: Bank of America, J. P. Morgan U.S.
Bank, and PNC Financial Services.
April 23, 2013 saw the Associated Press' Twitter account's hacked - the hacker
posted a hoax tweet about fictitious attacks in the White House that they claimed
left President Obama injured. This hoax tweet resulted in a brief plunge of 130
points from the Dow Jones Industrial Average, removal of $136 billion from S&P
500 index, and the temporary suspension of AP's Twitter account. The Dow
Jones later restored its session gains.
In May 2017, 74 countries logged a ransomware cybercrime, called "WannaCry"
Illicit access to camera sensors, microphone sensors, phonebook contacts, all
internet-enabled apps, and metadata of mobile telephones running Android and
IOS were reportedly made accessible by Israeli spyware, found to be being in
operation in at least 46 nation-states around the world. Journalists, Royalty and
government officials were amongst the targets. Previous accusations of cases of
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Israeli-weapons companies meddling in international telephony and smartphones
have been eclipsed in the 2018 reported case.
Diffusion of Cybercrime
Combating Computer Crime
The broad diffusion of cybercriminal activities is an issue in computer crimes detection
and prosecution. According to Jean-Loup Richet (Research Fellow at ESSEC ISIS),
technical expertise and accessibility no longer act as barriers to entry into cybercrime.
Indeed, hacking is much less complex than it was a few years ago, as hacking
communities have greatly diffused their knowledge through the Internet. Blogs and
communities have hugely contributed to information sharing: beginners could benefit
from older hackers' knowledge and advice. Furthermore, hacking is cheaper than ever:
before the cloud computing era, in order to spam or scam one needed a dedicated
server, skills in server management, network configuration, and maintenance,
knowledge of Internet service provider standards, etc. By comparison, a mail softwareas-a-service
is a scalable, inexpensive, bulk, and transactional e-mail-sending service
for marketing purposes and could be easily set up for spam. Jean-Loup Richet explains
that cloud computing could be helpful for a cybercriminal as a way to leverage his attack
– brute-forcing a password, improve the reach of a botnet, or facilitating a spamming
campaign.
Investigation
A computer can be a source of evidence (see digital forensics). Even where a computer
is not directly used for criminal purposes, it may contain records of value to criminal
investigators in the form of a logfile. In most countries Internet Service Providers are
required, by law, to keep their logfiles for a predetermined amount of time. For example;
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a European wide Data Retention Directive (applicable to all EU member states) states
that all e-mail traffic should be retained for a minimum of 12 months.
Methodology of Cybercrime Investigation
There are many ways for cybercrime to take place, and investigations tend to start with
an IP Address trace, however that is not necessarily a factual basis upon which
detectives can solve a case. Different types of high-tech crime may also include
elements of low-tech crime, and vice versa, making cybercrime investigators an
indispensable part of modern law-enforcement. Methodology of cybercrime detective
work is dynamic and is constantly improving, whether in closed police units, or in
international cooperation framework.
Legislation
Due to easily exploitable laws, cybercriminals use developing countries in order to
evade detection and prosecution from law enforcement. In developing countries, such
as the Philippines, laws against cybercrime are weak or sometimes nonexistent.
These weak laws allow cybercriminals to strike from international borders and remain
undetected. Even when identified, these criminals avoid being punished or extradited to
a country, such as the United States, that has developed laws that allow for
prosecution. While this proves difficult in some cases, agencies, such as the FBI, have
used deception and subterfuge to catch criminals. For example, two Russian hackers
had been evading the FBI for some time.
The FBI set up a fake computing company based in Seattle, Washington. They
proceeded to lure the two Russian men into the United States by offering them work
with this company. Upon completion of the interview, the suspects were arrested
outside of the building. Clever tricks like this are sometimes a necessary part of
catching cybercriminals when weak legislation makes it impossible otherwise.
President Barack Obama released in an executive order in April 2015 to combat
cybercrime. The executive order allows the United States to freeze assets of convicted
cybercriminals and block their economic activity within the United States. This is some
of the first solid legislation that combats cybercrime in this way.
The European Union adopted directive 2013/40/EU. All offences of the directive, and
other definitions and procedural institutions are also in the Council of Europe's
Convention on Cybercrime..
It is not only the USA and the European Union who are introducing new measures
against cybercrime. ON 31 May 2017 China announced that its new cybersecurity law
takes effect on this date.
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Penalties
Penalties for computer-related crimes in New York State can range from a fine and a
short period of jail time for a Class A misdemeanor such as unauthorized use of a
computer up to computer tampering in the first degree which is a Class C felony and
can carry 3 to 15 years in prison.
However, some hackers have been hired as information security experts by private
companies due to their inside knowledge of computer crime, a phenomenon which
theoretically could create perverse incentives. A possible counter to this is for courts to
ban convicted hackers from using the Internet or computers, even after they have been
released from prison – though as computers and the Internet become more and more
central to everyday life, this type of punishment may be viewed as more and more harsh
and draconian. However, nuanced approaches have been developed that manage
cyber offenders' behavior without resorting to total computer or Internet bans. These
approaches involve restricting individuals to specific devices which are subject to
computer monitoring or computer searches by probation or parole officers.
Awareness
As technology advances and more people rely on the internet to store sensitive
information such as banking or credit card information, criminals increasingly attempt to
steal that information. Cybercrime is becoming more of a threat to people across the
world. Raising awareness about how information is being protected and the tactics
criminals use to steal that information continues to grow in importance. According to the
FBI's Internet Crime Complaint Center in 2014, there were 269,422 complaints filed.
With all the claims combined there was a reported total loss of $800,492,073. But
cybercrime does yet seem to be on the average person's radar. There are 1.5 million
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cyber-attacks annually, that means that there are over 4,000 attacks a day, 170 attacks
every hour, or nearly three attacks every minute, with studies showing us that only 16%
of victims had asked the people who were carrying out the attacks to stop. Anybody
who uses the internet for any reason can be a victim, which is why it is important to be
aware of how one is being protected while online.
Intelligence
As cybercrime has proliferated, a professional ecosystem has evolved to support
individuals and groups seeking to profit from cybercriminal activities. The ecosystem
has become quite specialized, including malware developers, botnet operators,
professional cybercrime groups, groups specializing in the sale of stolen content, and so
forth. A few of the leading cybersecurity companies have the skills, resources and
visibility to follow the activities of these individuals and group. A wide variety of
information is available from these sources which can be used for defensive purposes,
including technical indicators such as hashes of infected files or malicious IPs/URLs, as
well as strategic information profiling the goals, techniques and campaigns of the
profiled groups. Some of it is freely published, but consistent, on-going access typically
requires subscribing to an adversary intelligence subscription service. At the level of an
individual threat actor, threat intelligence is often referred to that actor's "TTP", or
"tactics, techniques, and procedures," as the infrastructure, tools, and other technical
indicators are often trivial for attackers to change. Corporate sectors are considering
crucial role of artificial intelligence cyber security.
Agencies
ASEAN
Australian High Tech Crime Centre
Cyber Crime Investigation Cell, a wing of Mumbai Police, India
Cyber Crime Unit (Hellenic Police), formed in Greece in 1995
National White Collar Crime Center, in the United States
National Cyber Crime Unit, in the United Kingdom
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V. Drug Trafficking
The Illegal Drug Trade or Drug Trafficking is a global black market dedicated to the
cultivation, manufacture, distribution and sale of drugs that are subject to drug
prohibition laws. Most jurisdictions prohibit trade, except under license, of many types of
drugs through the use of drug prohibition laws.
The United Nations Office on Drugs and Crime's World Drug Report 2005 estimates the
size of the global illicit drug market at US$321.6 billion in 2003 alone. With a world GDP
of US$36 trillion in the same year, the illegal drug trade may be estimated as nearly 1%
of total global trade. Consumption of illegal drugs is widespread globally and remains
very difficult for local authorities to thwart its popularity.
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History
Chinese authorities issued edicts against opium smoking in 1729, 1796 and 1800. The
West prohibited addictive drugs throughout the late 19th and early 20th centuries.
In the early 19th century, an illegal drug trade in China emerged. As a result, by 1838
the number of Chinese opium-addicts had grown to between four and twelve million.
The Chinese government responded by enforcing a ban on the import of opium; this led
to the First Opium War (1839-1842) between the United Kingdom and Qing-dynasty
China. The United Kingdom won and forced China to allow British merchants to sell
Indian-grown opium. Trading in opium was lucrative, and smoking opium had become
common in the 19th century, so British merchants increased trade with the Chinese.
The Second Opium War broke out in 1856, with the British joined this time by the
French. After the two Opium Wars, the British Crown, via the treaties of Nanking (1842),
and Tianjin (1858), obligated the Chinese government to pay large sums of money for
opium they had seized and destroyed, which were referred to as "reparations".
In 1868, as a result of the increased use of opium, the UK restricted the sale of opium in
Britain by implementing the 1868 Pharmacy Act. In the United States, control of opium
remained under the control of individual US states until the introduction of the Harrison
Act in 1914, after 12 international powers signed the International Opium Convention in
1912.
Between 1920 and 1933 the Eighteenth Amendment to the United States Constitution
banned alcohol in the United States. Prohibition proved almost impossible to enforce
and resulted in the rise of organized crime, including the modern American Mafia, which
identified enormous business opportunities in the manufacturing, smuggling and sale of
illicit liquor.
The beginning of the 21st century saw drug use increase in North America and Europe,
with a particularly increased demand for marijuana and cocaine. As a result,
international organized crime syndicates such as the Sinaloa Cartel and 'Ndrangheta
have increased cooperation among each other in order to facilitate trans-Atlantic drugtrafficking.
Use of another illicit drug, hashish, has also increased in Europe.
Drug trafficking is widely regarded by lawmakers as a serious offense around the world.
Penalties often depend on the type of drug (and its classification in the country into
which it is being trafficked), the quantity trafficked, where the drugs are sold and how
they are distributed. If the drugs are sold to underage people, then the penalties for
trafficking may be harsher than in other circumstances.
Drug smuggling carries severe penalties in many countries. Sentencing may include
lengthy periods of incarceration, flogging and even the death penalty (in Singapore,
Malaysia, Indonesia and elsewhere). In December 2005, Van Tuong Nguyen, a 25-
year-old Australian drug smuggler, was hanged in Singapore after being convicted in
March 2004. In 2010, two people were sentenced to death in Malaysia for trafficking 1
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kilogram (2.2 lb) of cannabis into the country. Execution is mostly used as a deterrent,
and many have called upon much more effective measures to be taken by countries to
tackle drug trafficking; for example, targeting specific criminal organisations (which are
often also active in the smuggling of other goods (i.e. wildlife) and even people In some
cases, even links between politicians and the criminal organisations have been proven
to exist.
Effects of The Illegal Drug Trade on Societies
The countries of drug production and transit are some of the most affected by the drug
trade, though countries receiving the illegally imported substances are also adversely
affected. For example, Ecuador has absorbed up to 300,000 refugees from Colombia
who are running from guerrillas, paramilitaries and drug lords. While some applied for
asylum, others are still illegal immigrants. The drugs that pass from Colombia through
Ecuador to other parts of South America create economic and social problems.
Honduras, through which an estimated 79% of cocaine passes on its way to the United
States, has the highest murder rate in the world. According to the International Crisis
Group, the most violent regions in Central America, particularly along the Guatemala–
Honduras border, are highly correlated with an abundance of drug trafficking activity.
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Violent Crime
In many countries worldwide, the illegal drug trade is thought to be directly linked to
violent crimes such as murder. This is especially true in all developing countries, such
as Honduras, but is also an issue for many developed countries worldwide. In the late
1990s in the United States the Federal Bureau of Investigation estimated that 5% of
murders were drug-related. In Colombia, Drug violence can be caused by factors such
as, the economy, poor governments, and no authority within the law enforcement.
After a crackdown by US and Mexican authorities in the first decade of the 21st century
as part of tightened border security in the wake of the September 11 attacks, border
violence inside Mexico surged. The Mexican government estimates that 90% of the
killings are drug-related.
A report by the UK government's Drug Strategy Unit that was leaked to the press, stated
that due to the expensive price of highly addictive drugs heroin and cocaine, drug use
was responsible for the great majority of crime, including 85% of shoplifting, 70-80% of
burglaries and 54% of robberies. It concluded that "[t]he cost of crime committed to
support illegal cocaine and heroin habits amounts to £16 billion a year in the UK"
South America
Drug Trafficking Routes
Venezuela has been a path to the United States and Europe for illegal drugs originating
in Colombia, through Central America, Mexico and Caribbean countries such as Haiti,
the Dominican Republic, and Puerto Rico.
According to the United Nations, there was an increase of cocaine trafficking through
Venezuela since 2002. In 2005 Venezuela severed ties with the United States Drug
Enforcement Administration (DEA), accusing its representatives of spying. Following the
departure of the DEA from Venezuela and the expansion of DEA's partnership with
Colombia in 2005, Venezuela became more attractive to drug traffickers. Between 2008
and 2012, Venezuela's cocaine seizure ranking among other countries declined, going
from being ranked fourth in the world for cocaine seizures in 2008 to sixth in the world in
2012.
On 18 November 2016, following what was known as the Narcosobrinos incident,
Venezuelan President Nicolás Maduro's two nephews were found guilty of trying to ship
drugs into the United States so they could "obtain a large amount of cash to help their
family stay in power".
West Africa
Cocaine produced in Colombia and Bolivia increasingly has been shipped via West
Africa (especially in Cape Verde, Mali, Benin, Togo, Nigeria, Cameroon, Guinea-Bissau
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and Ghana). The money is often laundered in countries such as Nigeria, Ghana and
Senegal.
According to the Africa Economic Institute, the value of illicit drug smuggling in Guinea-
Bissau is almost twice the value of the country's GDP. Police officers are often bribed. A
police officer's normal monthly wage of $93 is less than 2% of the value of 1 kilogram
(2.2 lb) of cocaine (€7000 or $8750). The money can also be laundered using real
estate. A house is built using illegal funds, and when the house is sold, legal money is
earned. When drugs are sent over land, through the Sahara, the drug traders have
been forced to cooperate with terrorist organizations, such as Al Qaida in Islamic
Maghreb.
Eastern and Southern Africa
Heroin is increasingly trafficked from Afghanistan to Europe and America through
eastern and southern African countries. This path is known as the “southern route” or
“smack track.” Repercussions of this trade include burgeoning heroin use and political
corruption among intermediary African nations.
Asia
Drugs in Asia traditionally traveled the southern routes - the main caravan axes of
Southeast Asia and Southern China - and include the former opium-producing countries
of Thailand, Iran, and Pakistan. After the 1990s, particularly after the Cold War ended,
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orders were opened and trading and customs agreements were signed so that the
routes expanded to include China, Central Asia, and Russia. There is, therefore, a
diversified drug trafficking routes available today, particularly in the heroin trade and
these thrive due to the continuous development of new markets. A large amount of
drugs are smuggled into Europe from Asia. The main sources of these drugs are
Afghanistan, along with countries that constituted the so-called Golden Crescent. From
these producers, drugs are smuggled into the West and Central Asia to its destinations
in Europe and the United States. Iran is now the route for smugglers, having been
previously a primary trading route, due to its large-scale and costly war against drug
trafficking. The Border Police Chief of Iran said that his country "is a strong barrier
against the trafficking of illegal drugs to Caucasus, especially the Republic of
Azerbaijan." The drugs produced by the Golden Triangle of Myanmar, Laos, and
Thailand, on the other hand, pass through the southern routes to feed the Australian,
U.S., and Asian markets.
Online
Drugs are increasingly traded online on the dark web on darknet markets.
Profits
Statistics about profits from the drug trade are largely unknown due to its illicit nature. In
its 1997 World Drugs Report the United Nations Office on Drugs and Crime estimated
the value of the market at $4 trillion, ranking drugs alongside arms and oil among the
world's largest traded goods. An online report published by the UK Home Office in 2007
estimated the illicit drug market in the UK at £4–6.6 billion a year
In December 2009 United Nations Office on Drugs and Crime Executive Director
Antonio Maria Costa claimed illegal drug money saved the banking industry from
collapse. He claimed he had seen evidence that the proceeds of organized crime were
"the only liquid investment capital" available to some banks on the brink of collapse
during 2008. He said that a majority of the $352 billion (£216bn) of drug profits was
absorbed into the economic system as a result:
"In many instances, the money from drugs was the only liquid investment capital. In the
second half of 2008, liquidity was the banking system's main problem and hence liquid
capital became an important factor...Inter-bank loans were funded by money that
originated from the drugs trade and other illegal activities...there were signs that some
banks were rescued that way".
Costa declined to identify countries or banks that may have received any drug money,
saying that would be inappropriate because his office is supposed to address the
problem, not apportion blame.
Though street-level drug sales are widely viewed as lucrative, a study by Sudhir
Venkatesh suggested that many low-level employees receive low wages. In a study he
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made in the 1990s working closely with members of the Black Gangster Disciple Nation
in Chicago, he found that one gang (essentially a franchise) consisted of a leader (a
college graduate named J.T.), three senior officers, and 25 to 75 street level salesmen
('foot soldiers') depending on season. Selling crack cocaine, they took in approximately
$32,000 per month over a six-year period. This was spent as follows: $5,000 to the
board of twenty directors of the Black Gangster Disciple Nation, who oversaw 100 such
gangs for approximately $500,000 in monthly income. Another $5,000 monthly was paid
for cocaine, and $4,000 for other non-wage expenses. J.T. took $8,500 monthly for his
own salary. The remaining $9,500 monthly went to pay the employees a $7 per hour
wage for officers and a $3.30 per hour wage for foot soldiers. Contrary to a popular
image of drug sales as a lucrative profession, many of the employees were living with
their mothers by necessity. Despite this, the gang had four times as many unpaid
members who dreamed of becoming foot soldiers.
Free Trade Link
There are several arguments on whether or not free trade has a correlation to an
increased activity in the illicit drug trade. Currently, the structure and operation of the
illicit drug industry is described mainly in terms of an international division of labor. Free
trade can open new markets to domestic producers who would otherwise resort to
exporting illicit drugs. Additionally, extensive free trade among states increases crossborder
drug enforcement and coordination between law enforcement agencies in
different countries. However, free trade also increases the sheer volume of legal crossborder
trade and provides cover for drug smuggling—by providing ample opportunity to
conceal illicit cargo in legal trade. While international free trade continues to expand the
volume of legal trade, the ability to detect and interdict drug trafficking is severely
diminished. Towards the late 1990s, the top ten seaports in the world processed 33.6
million containers. Free trade has fostered integration of financial markets and has
provided drug traffickers with more opportunities to launder money and invest in other
activities. This strengthens the drug industry while weakening the efforts of law
enforcement to monitor the flow of drug money into the legitimate economy.
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Cooperation among cartels expands their scope to distant markets and strengthens
their abilities to evade detection by local law enforcement. Additionally, criminal
organizations work together to coordinate money-laundering activities by having
separate organizations handle specific stages of laundering process. One organization
structures the process of how financial transactions will be laundered, while another
criminal group provides the “dirty” money to be cleaned. By fostering expansion of trade
and global transportation networks, free trade encourages cooperation and formation of
alliances among criminal organizations across different countries. The drug trade in
Latin America emerged in the early 1930s. It saw significant growth in the Andean
countries, including Peru, Bolivia, Chile, Ecuador, Colombia and Venezuela. The
underground market in the early half of the 20th century mainly had ties to Europe. After
World War II, the Andean countries saw an expansion of trade, specifically with cocaine.
Background
Drug Trafficking by Country
United States
The effects of the illegal drug trade in the United States can be seen in a range of
political, economic and social aspects. Increasing drug related violence can be tied to
the racial tension that arose during the late 20th century along with the political
upheaval prevalent throughout the 1960s and 70s. The second half of the 20th century
was a period when increased wealth, and increased discretionary spending, increased
the demand for illicit drugs in certain areas of the United States. Large-scale drug
trafficking is one of the few capital crimes, and may result in a death sentence
prescribed at the federal level.
Political Impact
A large generation, the baby boomers, came of age in the 1960s. Their social tendency
to confront the law on specific issues, including illegal drugs, overwhelmed the
understaffed judicial system. The federal government attempted to enforce the law, but
with meager effect.
Marijuana was a popular drug seen through the Latin American trade route in the
1960s. Cocaine became a major drug product in the later decades. Much of the cocaine
is smuggled from Colombia and Mexico via Jamaica. This led to several administrations
combating the popularity of these drugs. Due to the influence of this development on the
U.S. economy, the Reagan administration began "certifying" countries for their attempts
at controlling drug trafficking. This allowed the United States to intervene in activities
related to illegal drug transport in Latin America. Continuing into the 1980s, the United
States instated stricter policy pertaining to drug transit through sea. As a result, there
was an influx in drug-trafficking across the Mexico–U.S. border. This increased the drug
cartel activity in Mexico. By the early 1990s, so much as 50% of the cocaine available in
the United States market originated from Mexico, and by the 2000s, over 90% of the
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cocaine in the United States was imported from Mexico. In Colombia, however, there
was a fall of the major drug cartels in the mid-1990s. Visible shifts occurred in the drug
market in the United States. Between the 1996 and 2000, U.S. cocaine consumption
dropped by 11%.
In 2008, the U.S. government initiated another program, known as the Merida Initiative,
to help combat drug trafficking in Mexico. This program increased U.S. security
assistance to $1.4 billion over several years, which helped supply Mexican forces with
"high-end equipment from helicopters to surveillance technology". Despite U.S. aid,
Mexican "narcogangs" continue to outnumber and outgun the Mexican Army, allowing
for continued activities of drug cartels across the U.S.–Mexico border.
Social Impacts
Although narcotics are illegal in the US, they have become integrated into the nation's
culture and are seen as a recreational activity by sections of the population. Illicit drugs
are considered to be a commodity with strong demand, as they are typically sold at a
high value. This high price is caused by a combination of factors that include the
potential legal ramifications that exist for suppliers of illicit drugs and their high demand.
Despite the constant effort by politicians to win the war on drugs, the US is still the
world's largest importer of illegal drugs.
Throughout the 20th century, narcotics other than cocaine also crossed the Mexican
border, meeting the US demand for alcohol during the 1920s Prohibition, opiates in the
1940s, marijuana in the 1960s, and heroin in the 1970s. Most of the U.S. imports of
drugs come from Mexican drug cartels. In the United States, around 195 cities have
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een infiltrated by drug trafficking that originated in Mexico. An estimated $10bn of the
Mexican drug cartel's profits come from the United States, not only supplying the
Mexican drug cartels with the profit necessary for survival, but also furthering America's
economic dependence on drugs.
Demographics
With a large wave of immigrants in the 1960s and onwards, the United States saw an
increased heterogeneity in its public. In the 1980s and 90s, drug related homicide was
at a record high. This increase in drug violence became increasingly tied to these ethnic
minorities. Though the rate of violence varied tremendously among cities in America, it
was a common anxiety in communities across urban America. An example of this could
be seen in Miami, a city with a host of ethnic enclaves. Between 1985 and 1995, the
homicide rate in Miami was one of the highest in the nation—four times the national
homicide average. This crime rate was correlated with regions with low employment and
was not entirely dependent on ethnicity.
The baby boomer generation also felt the effects of the drug trade in their increased
drug use from the 1960s to 80s. Along with substance abuse, criminal involvement,
suicide and murder were also on the rise. Due to the large amount of baby boomers,
commercial marijuana use was on the rise. This increased the supply and demand for
marijuana during this time period.
Mexico
Political Influences
Corruption in Mexico has contributed to the domination of Mexican cartels in the illicit
drug trade. Since the beginning of the 20th century, Mexico's political environment
allowed the growth of drug-related activity. The loose regulation over the transportation
of illegal drugs and the failure to prosecute known drug traffickers and gangs increased
the growth of the drug industry. Toleration of drug trafficking has undermined the
authority of the Mexican government and has decreased the power of law enforcement
officers in regulation over such activities. These policies of tolerance fostered the
growing power of drug cartels in the Mexican economy and have made drug traders
wealthier. Many states in Mexico lack policies that establish stability in governance.
There also is a lack of local stability, as mayors cannot be re-elected. This requires
electing a new mayor each term. Drug gangs have manipulated this, using vacuums in
local leadership to their own advantage.
In 1929, the Institutional Revolutionary Party (PRI) was formed to resolve the chaos
resulting from the Mexican Revolution. Over time, this party gained political influence
and had a major impact on Mexico's social and economic policies. The party created
ties with various groups as a power play in order to gain influence, and as a result
created more corruption in the government. One such power play was an alliance with
drug traffickers. This political corruption obscured justice, making it difficult to identify
violence when it related to drugs. By the 1940s, the tie between the drug cartels and the
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PRI had solidified. This arrangement created immunity for the leaders of the drug
cartels and allowed drug trafficking to grow under the protection of the government
officials. During the 1990s, the PRI lost some elections to the new National Action
Party(PAN). Chaos again emerged as elected government in Mexico changed
drastically. As the PAN party took control, drug cartel leaders took advantage of the
ensuing confusion and used their existing influence to further gain power. Instead of
negotiating with the central government as was done with the PRI party, drug cartels
utilized new ways to distribute their supply and continued operating through force and
intimidation. As Mexico became more democratized, the corruption fell from a
centralized power to the local authorities. [61] Cartels began to bribe local authorities,
thus eliminating the structure and rules placed by the government—giving cartels more
freedom. As a response, Mexico saw an increase in violence caused by drug trafficking.
The corruption cartels created resulted in distrust of government by the Mexican public.
This distrust became more prominent after the collapse of the PRI party. In response,
the presidents of Mexico, in the late twentieth century and early twenty-first century,
implemented several different programs relating to law enforcement and regulation. In
1993, President Salinas created the National Institute for the Combat of Drugs in
Mexico. From 1995–1998, President Zedillo established policies regarding increased
punishment of organized crime, allowing "[wire taps], protected witnesses, covert agents
and seizures of goods", and increasing the quality of law enforcement at the federal
level. From 2001–2005, President Vicente Fox created the Federal Agency of
Investigation. These policies resulted in the arrests of major drug-trafficking bosses:
Mexico's Economy
Arrested Drug Traffickers
Year Person Cartel
1989 Miguel Angel Felix Gallardo Sinaloa Cartel
1993 Joaquín Guzmán Loera Sinaloa Cartel
1995 Héctor Luis Palma
1996 Juan Garcia Abrego Gulf Cartel
2002 Ismael Higuera Guerrero Tijuana Cartel
Jesus Labra
Tijuana Cartel
Adan Amezcua
Colima Cartel
Benjamin Arellano Felix Tijuana Cartel
2003 Osiel Cardenas Gulf Cartel
Over the past few decades drug cartels have become integrated into Mexico's
economy. Approximately 500 cities are directly engaged in drug trafficking and nearly
450,000 people are employed by drug cartels. Additionally, the livelihood of 3.2 million
people is dependent on the drug cartels. Between local and international sales, such as
to Europe and the United States, drug cartels in Mexico see a $25–30bn yearly profit, a
great deal of which circulates through international banks such as HSBC. Drug cartels
are fundamental in local economics. A percentage of the profits seen from the trade are
invested in the local community. Such profits contribute to the education and healthcare
of the community. While these cartels bring violence and hazards into communities,
they create jobs and provide income for its many members.
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Culture of Drug Cartels
Major cartels saw growth due to a prominent set culture of Mexican society that created
the means for drug capital. One of the sites of origin for drug trafficking within Mexico,
was the state of Michoacán. In the past, Michoacán was mainly an agricultural society.
This provided an initial growth of trade. Industrialization of rural areas of Mexico
facilitated a greater distribution of drugs, expanding the drug market into different
provinces. Once towns became industrialized, cartels such as the Sinaloa Cartel started
to form and expand. The proliferation of drug cartel culture largely stemmed from the
ranchero culture seen in Michoacán. Ranchero culture values the individual as opposed
to the society as a whole. This culture fostered the drug culture of valuing the family that
is formed within the cartel. This ideal allowed for greater organization within the cartels.
Gangs play a major role in the activity of drug cartels. MS-13 and the 18th Street gang
are notorious for their contributions and influence over drug trafficking throughout Latin
America. MS-13 has controlled much of the activity in the drug trade spanning from
Mexico to Panama Female involvement is present in the Mexican drug culture. Although
females are not treated as equals to males, they typically hold more power than their
culture allows and acquire some independence. The increase in power has attracted
females from higher social classes. Financial gain has also prompted women to become
involved in the illegal drug market. Many women in the lower levels of major drug cartels
belong to a low economic class. Drug trafficking offers women an accessible way to
earn income. Females from all social classes have become involved in the trade due to
outside pressure from their social and economic environments.
Political Ties
Colombia
It was common for smugglers in Colombia to import liquor, alcohol, cigarettes and
textiles, while exporting cocaine. Personnel with knowledge of the terrain were able to
supply the local market while also exporting a large amount of product. The established
trade that began in the 1960s involved Peru, Bolivia, Colombia, Venezuela and Cuba.
Peasant farmers produced coca paste in Peru and Bolivia, while Colombian smugglers
would process the coca paste into cocaine in Colombia, and trafficked product through
Cuba. This trade route established ties between Cuban and Colombian organized
crime. From Cuba, cocaine would be transported to Miami, Florida; and Union City, New
Jersey. Quantities of the drug were then smuggled throughout the US. The international
drug trade created political ties between the involved countries, encouraging the
governments of the countries involved to collaborate and instate common policies to
eradicate drug cartels. Cuba stopped being a center for transport of cocaine following
the establishment of a communist government in 1959. As a result, Miami and Union
City became the sole locations for trafficking. The relations between Cuban and
Colombian organized crime remained strong until the 1970s, when Colombian cartels
began to vie for power. In the 1980s and 90s, Colombia emerged as a key contributor of
the drug trade industry in the Western Hemisphere. While the smuggling of drugs such
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as marijuana, poppy, opium and heroin became more ubiquitous during this time period,
the activity of cocaine cartels drove the development of the Latin American drug trade.
The trade emerged as a multinational effort as supplies (i.e. coca plant substances)
were imported from countries such as Bolivia and Peru, were refined in Colombian
cocaine labs and smuggled through Colombia, and exported to countries such as the
US.
Colombia's Economy
Colombia has had a significant role in the illegal drug trade in Latin America. While
active in the drug trade since the 1930s, Colombia's role in the drug trade did not truly
become dominant until the 1970s. When Mexico eradicated marijuana plantations,
demand stayed the same. Colombia met much of the demand by growing more
marijuana. Grown in the strategic northeast region of Colombia, marijuana soon
became the leading cash crop in Colombia. This success was short-lived due to antimarijuana
campaigns that were enforced by the US military throughout the Caribbean.
Instead, drug traffickers in Colombia continued their focus on the exportation of cocaine.
Having been an export of Colombia since the early 1950s, cocaine remained popular for
a host of reasons. Colombia's location facilitated its transportation from South America
into Central America, and then to its destination of North America. This continued into
the 1990s, when Colombia remained the chief exporter of cocaine. The business of
drug trafficking can be seen in several stages in Colombia towards the latter half of the
20th century. Colombia served as the dominant force in the distribution and sale of
cocaine by the 1980s. As drug producers gained more power, they became more
centralized and organized into what became drug cartels. Cartels controlled the major
aspects of each stage in the traffic of their product. Their organization allowed cocaine
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to be distributed in great amounts throughout the United States. By the late 1980s, intraindustry
strife arose within the cartels. This stage was marked by increased violence as
different cartels fought for control of export markets. Despite this strife, this power
struggle led to then having multiple producers of coca leaf farms. This in turn caused an
improvement in quality control and reduction of police interdiction in the distribution of
cocaine. This also led to cartels attempting to repatriate their earnings which would
eventually make up 5.5% of Colombia's GDP. This drive to repatriate earnings led to the
pressure of legitimizing their wealth, causing an increase in violence throughout
Colombia.
Throughout the 1980s, estimates of illegal drug value in Colombia ranged from $2bn to
$4bn. This made up about 7-10% of the $36bn estimated GNP of Colombia during this
decade. In the 1990s, the estimates of the illegal drug value remained roughly within the
same range (~$2.5bn). As the Colombian GNP rose throughout the 90's ($68.5bn in
1994 and $96.3bn in 1997), illegal drug values began to comprise a decreasing fraction
of the national economy. By the early 1990s, although Colombia led in the exportation
of cocaine, it found increasing confrontations within its state. These confrontations were
primarily between cartels and government institutions. This led to a decrease in the drug
trade's contribution to the GDP of Colombia; dropping from 5.5% to 2.6%. Though a
contributor of wealth, the distribution of cocaine has had negative effects on the sociopolitical
situation of Colombia and has weakened its economy as well.
Social Impacts
By the 1980s, Colombian cartels became the dominant cocaine distributors in the US.
This led to the spread of increased violence throughout both Latin America and Miami.
In the 1980s, two major drug cartels emerged in Colombia: the Medellin and Cali
groups. Throughout the 90's however, several factors led to the decline of these major
cartels and to the rise of smaller Colombian cartels. The U.S. demand for cocaine
dropped while Colombian production rose, pressuring traffickers to find new drugs and
markets. In this time period, there was an increase in activity of Caribbean cartels that
led to the rise of an alternate route of smuggling through Mexico. This led to the
increased collaboration between major Colombian and Mexican drug traffickers. Such
drastic changes in the execution of drug trade in Colombia paired with the political
instabilities and rise of drug wars in Medellin and Cali, gave way for the rise of the
smaller Colombian drug trafficking organizations (and the rise of heroin trade). As the
drug trade's influence over the economy increased, drug lords and their networks grew
in their power and influence in society. The occurrences in drug-related violence
increased during this time period as drug lords fought to maintain their control in the
economy. Typically a drug cartel had support networks that consisted of a number of
individuals. These people individuals ranged from those directly involved in the trade
(such as suppliers, chemists, transporters, smugglers, etc.) as well as those involved
indirectly in the trade (such as politicians, bankers, police, etc.). As these smaller
Colombian drug cartels grew in prevalence, several notable aspects of the Colombian
society gave way for further development of the Colombian drug industry. For example,
until the late 1980s, the long-term effects of the drug industry were not realized by much
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of society. Additionally, there was a lack of regulation in prisons where captured
traffickers were sent. These prisons were under-regulated, under-funded, and understaffed,
which allowed for the formation of prison gangs, for the smuggling of
arms/weapons/etc., for feasible escapes, and even for captured drug lords to continue
running their businesses from prison.
Cannabis
Trade In Specific Drugs
While the recreational use of (and consequently the distribution of) cannabis is illegal in
most countries throughout the world, it is available by prescription or recommendation in
many places, including Canada and 10 of the 50 US states (although importation and
distribution is still federally prohibited). Beginning in 2014, Uruguay became the first
country to legalize cultivation, sale, and consumption of cannabis for recreational use
for adult residents. In 2018, Canada became the only second country to legalize use,
sale and cultivation of cannabis. The first few weeks were met with extremely high
demand, most shops being out of stock after operating for only four days.
Cannabis use is tolerated in some areas, most notably the Netherlands which has
legalized the possession and licensed sale (but not cultivation) of the drug. Many
nations have decriminalized the possession of small amounts of marijuana. Due to the
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hardy nature of the cannabis plant, marijuana is grown all across the world and is today
the world's most popular illegal drug with the highest level of availability. Cannabis is
grown legally in many countries for industrial, non-drug use (known as hemp) as well.
Cannabis-hemp may also be planted for other non-drug domestic purposes, such as
seasoning that occurs in Aceh.
The demand for cannabis around the world, coupled with the drug's relative ease of
cultivation, makes the illicit cannabis trade one of the primary ways in which organized
criminal groups finance many of their activities. In Mexico, for example, the illicit
trafficking of cannabis is thought to constitute the majority of many of the cartels'
earnings, and the main way in which the cartels finance many other illegal activities;
including the purchase of other illegal drugs for trafficking, and for acquiring weapons
that are ultimately used to commit murders (causing a burgeoning in the homicide rates
of many areas of the world, but particularly Latin America).
Some studies show that the increased legalization of cannabis in the United States
(beginning in 2012 with Washington Initiative 502 and Colorado Amendment 64) has led
Mexican cartels to smuggle less cannabis in exchange for more heroin.
Alcohol
Alcohol, in the context of alcoholic beverages rather than denatured alcohol, is illegal in
a number of Muslim countries, such as Saudi Arabia, and this has resulted in a thriving
illegal trade in alcohol. The manufacture, sale, transportation, importation and
exportation of alcoholic beverage were illegal in the United States during the time
known as the Prohibition in the 1920s and early 1930s.
Heroin
Heroin woven into a hand-made knotted carpet seized at
Manchester Airport, 2012
Up until around 2004 the majority of the world's heroin
was produced in an area known as the Golden
Triangle. However, by 2007, 93% of the opiates on the
world market originated in Afghanistan. This amounted
to an export value of about US$64 billion, with a
quarter being earned by opium farmers and the rest
going to district officials, insurgents, warlords and drug traffickers. Another significant
area where poppy fields are grown for the manufacture of heroin is Mexico.
According to the United States Drug Enforcement Administration, the price of heroin is
typically valued 8 to 10 times that of cocaine on American streets, making it a high-profit
substance for smugglers and dealers. In Europe (except the transit countries Portugal
and the Netherlands), for example, a purported gram of street heroin, usually consisting
of 700–800 mg of a light to dark brown powder containing 5-10% heroin base, costs
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€30-70, making the effective value per gram of pure heroin €300-700. Heroin is
generally a preferred product for smuggling and distribution—over unrefined opium due
to the cost-effectiveness and increased efficacy of heroin.
Because of the high cost per volume, heroin is easily smuggled. A US quarter-sized
(2.5 cm) cylindrical vial can contain hundreds of doses. From the 1930s to the early
1970s, the so-called French Connection supplied the majority of US demand. Allegedly,
during the Vietnam War, drug lords such as Ike Atkinson used to smuggle hundreds of
kilograms of heroin to the US in coffins of dead American soldiers (see Cadaver
Connection). Since that time it has become more difficult for drugs to be imported into
the US than it had been in previous decades, but that does not stop the heroin
smugglers from getting their product across US borders. Purity levels vary greatly by
region with Northeastern cities having the most pure heroin in the United States. On 17
October 2018 police in Genoa Italy, discovered 270 kg of heroin hidden in a ship
coming from the Iranian southern port of Bandar Abbas. The ship had already passed
and stopped at Hamburg in Germany and Valencia in Spain.
Penalties for smuggling heroin or morphine are often harsh in most countries. Some
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countries will readily hand down a death sentence (e.g. Singapore) or life in prison for
the illegal smuggling of heroin or morphine, which are both internationally Schedule I
drugs under the Single Convention on Narcotic Drugs.
Methamphetamine
Methamphetamine is another popular drug among distributors. Three common street
names are "crystal meth", "meth", and "ice".
According to the Community Epidemiology Work Group, the number of clandestine
methamphetamine laboratory incidents reported to the National Clandestine Laboratory
Database decreased from 1999 to 2009. During this period, methamphetamine lab
incidents increased in mid-western States (Illinois, Michigan, Missouri, and Ohio), and in
Pennsylvania. In 2004, more lab incidents were reported in Missouri (2,788) and Illinois
(1,058) than in California (764). In 2003, methamphetamine lab incidents reached new
highs in Georgia (250), Minnesota (309), and Texas (677). There were only seven
methamphetamine lab incidents reported in Hawaii in 2004, though nearly 59 percent of
substance abuse treatment admissions (excluding alcohol) were for primary
methamphetamine abuse during the first six months of 2004. As of 2007, Missouri leads
the United States in drug-lab seizures, with 1,268 incidents reported. Often canine units
are used for detecting rolling meth labs which can be concealed on large vehicles, or
transported on something as small as a motorcycle. These labs are more difficult to
detect than stationary ones, and can often be obscured among legal cargo in big trucks.
Methamphetamine is sometimes used intraveneously, placing users and their partners
at risk for transmission of HIV and hepatitis C. "Meth" can also be inhaled, most
commonly vaporized on aluminum foil or in a glass pipe. This method is reported to give
"an unnatural high" and a "brief intense rush".
In South Africa methamphetamine is called "tik" or "tik-tik"."Known locally as "tik," the
drug was virtually unknown as late as 2003. Now, it is the country's main drug of abuse,
even when alcohol is included. " Children as young as eight are abusing the substance,
smoking it in crude glass vials made from light bulbs. Since methamphetamine is easy
to produce, the substance is manufactured locally in staggering quantities.
The government of North Korea currently operates methamphetamine production
facilities. There, the drug is used as medicine because no alternatives are available; it
also is smuggled across the Chinese border.
The Australian Crime Commission's illicit drug data report for 2011–2012 stated that the
average strength of crystal methamphetamine doubled in most Australian jurisdictions
within a 12-month period, and the majority of domestic laboratory closures involved
small "addict-based" operations.
Temazepam
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Temazepam, a strong hypnotic benzodiazepine, is illicitly manufactured in clandestine
laboratories (called jellie labs) to supply the increasingly high demand for the drug
internationally. Many clandestine temazepam labs are in Eastern Europe. The labs
manufacture temazepam by chemically altering diazepam, oxazepam or lorazepam.
"Jellie labs" have been identified and shut down in Russia, the Ukraine, Czech
Republic, Latvia and Belarus.
Surveys in many countries show that temazepam, MDMA, nimetazepam, and
methamphetamine rank among the top illegal drugs most frequently abused.
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VI. Embezzlement
Embezzlement is the act of withholding assets for the purpose of conversion (theft) of
such assets, by one or more persons to whom the assets were entrusted, either to be
held or to be used for specific purposes. Embezzlement is a type of financial fraud. For
example, a lawyer might embezzle funds from the trust accounts of their clients; a
financial advisor might embezzle the funds of investors; and a husband or a wife might
embezzle funds from a bank account jointly held with the spouse.
Embezzlement usually is a premeditated crime, performed methodically, with
precautions that conceal the criminal conversion of the property, which occurs without
the knowledge or consent of the affected person. Often it involves the trusted individual
embezzling only a small proportion of the total of the funds or resources they receive or
control, in an attempt to minimize the risk of the detection of the misallocation of the
funds or resources. When successful, embezzlements may continue for many years
without detection. The victims often realize that the funds, savings, assets, or other
resources, are missing and that they have been duped by the embezzler, only when a
relatively large proportion of the funds are needed at one time; or the funds are called
upon for another use; or when a major institutional reorganization (the closing or moving
of a plant or business office, or a merger/acquisition of a firm) requires the complete and
independent accounting of all real and liquid assets, prior to or concurrent with the
reorganization.
In the United States, embezzlement is a statutory offence that, depending on the
circumstances, may be a crime under state law, federal law, or both; therefore, the
definition of the crime of embezzlement varies according to the given statute. Typically,
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the criminal elements of embezzlement are the fraudulent conversion of the property of
another person by the person who has lawful possession of the property.
i. Fraudulence: The requirement that the conversion be fraudulent requires that
the embezzler willfully, and without claim of right or mistake, converted the
entrusted property to their own use.
ii.
iii.
iv.
Criminal conversion: Embezzlement is a crime against ownership, that is,
voiding the right of the owner to control the disposition and use of the property
entrusted to the embezzler. The element of criminal conversion requires
substantial interference with the property rights of the owner (unlike larceny,
wherein the slightest movement of the property, when accompanied by the intent
to permanently deprive the owner of possession of the property is sufficient
cause).
Property: Embezzlement statutes do not limit the scope of the crime to
conversions of personal property. Statutes generally include conversion of
tangible personal property, intangible personal property, and choses in action.
Real property is not typically included.
of another: A person cannot embezzle his or her own property.
v. Lawful possession: The critical element is that the embezzler must have been
in lawful possession of the property at the time of the fraudulent conversion, and
not merely have custody of the property. If the thief had lawful possession of the
property, the crime is embezzlement; if the thief merely had custody, the crime at
common law is larceny.
Embezzlement v. Larceny
Embezzlement differs from larceny in three ways. First, in embezzlement, an actual
conversion must occur; second, the original taking must not be trespassory, and three,
in penalties. To say that the taking was not trespassory is to say that the persons
performing the embezzlement had the right to possess, use or access the assets in
question, and that such persons subsequently secreted and converted the assets for an
unintended or unsanctioned use. Conversion requires that the secretion interfere with
the property, rather than just relocate it. As in larceny, the measure is not the gain to the
embezzler, but the loss to the asset stakeholders. An example of conversion is when a
person logs checks in a check register or transaction log as being used for one specific
purpose and then explicitly uses the funds from the checking account for another and
completely different purpose.
It is important to make clear that embezzlement is not always a form of theft or an act of
stealing, since those definitions specifically deal with taking something that does not
belong to the perpetrators. Instead, embezzlement is, more generically, an act of
deceitfully secreting assets by one or more persons that have been entrusted with such
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assets. The persons entrusted with such assets may or may not have an ownership
stake in such assets.
In the case where it is a form of theft, distinguishing between embezzlement and
larceny can be tricky. Making the distinction is particularly difficult when dealing with
misappropriations of property by employees. To prove embezzlement, the state must
show that the employee had possession of the goods "by virtue of his or her
employment"; that is, that the employee had formally delegated authority to exercise
substantial control over the goods. Typically, in determining whether the employee had
sufficient control the courts will look at factors such as the job title, job description and
the particular operational practices of the firm or organization. For example, the
manager of a shoe department at a department store would likely have sufficient control
over the store's inventory (as head of the shoe department) of shoes; that if they
converted the goods to their own use they would be guilty of embezzlement. On the
other hand, if the same employee were to steal cosmetics from the cosmetics
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department of the store, the crime would not be embezzlement but larceny. For a case
that exemplifies the difficulty of distinguishing larceny and embezzlement see State v.
Weaver, 359 N.C. 246; 607 S.E.2d 599 (2005).
North Carolina appellate courts have compounded this confusion by misinterpreting a
statute based on an act passed by parliament in 1528. The North Carolina courts
interpreted this statute as creating an offence called "larceny by employee"; an offence
that was separate and distinct from common law larceny. However, as Perkins notes,
the purpose of the statute was not to create a new offence but was merely to confirm
that the acts described in the statute met the elements of common law larceny.
The statute served the purpose of the then North Carolina colony as an indentured
servant– and slave-based political economy. It ensured that an indentured servant (or
anyone bound to service of labor to a master, e.g., a slave), would owe to their master
their labor; and, if they left their indentured service or bound labor unlawfully, the labor
they produced, either for themselves (i.e., self-employed), or for anyone else, would be
the converted goods that they unlawfully took, from the rightful owner, their master.
Crucially (and this can be seen as the purpose of the statute), any subsequent employer
of such an indentured servant or slave, who was in fact bound to service of labor to a
pre-existing master, would be chargeable with misprision-of-a-felony (if it was proved in
they knew that the employee was still indentured to a master, or owned as a slave); and
chargeable as an accessory-after-the-fact, in the felony, with the servant or slave; in
helping them, by employing them, in the unlawfully taking that which was lawfully bound
(through the master servant relationship) in exclusive right, to the master of the
indentured servant or slave.
Methods of embezzlement
Embezzlement sometimes involves falsification of records in order to conceal the
activity. Embezzlers commonly secrete relatively small amounts repeatedly, in a
systematic or methodical manner, over a long period of time, although some
embezzlers secrete one large sum at once. Some very successful embezzlement
schemes have continued for many years before being detected due to the skill of the
embezzler in concealing the nature of the transactions or their skill in gaining the trust
and confidence of investors or clients, who are then reluctant to "test" the embezzler's
trustworthiness by forcing a withdrawal of funds.
Embezzling should not be confused with skimming, which is under-reporting income
and pocketing the difference. For example, in 2005, several managers of the service
provider Aramark were found to be under-reporting profits from a string of vending
machine locations in the eastern United States. While the amount stolen from each
machine was relatively small, the total amount taken from many machines over a length
of time was very large. A smart technique employed by many small-time embezzlers
can be covered by falsifying the records. (Example, by removing a small amount of
money and falsifying the record the register would be technically correct, while the
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manager would remove the profit and leave the float in, this method would effectively
make the register short for the next user and throw the blame onto them)
Another method is to create a false vendor account and supply false bills to the
company being embezzled so that the checks that are cut appear completely legitimate.
Yet another method is to create phantom employees, who are then paid with payroll
checks.
The latter two methods should be uncovered by routine audits, but often aren't if the
audit is not sufficiently in-depth, because the paperwork appears to be in order. A
publicly traded company must change auditors and audit companies every five years.
The first method is easier to detect if all transactions are by cheque or other instrument,
but if many transactions are in cash, it is much more difficult to identify. Employers have
developed a number of strategies to deal with this problem. In fact, cash registers were
invented just for this reason.
Some of the most complex (and potentially most lucrative) forms of embezzlement
involve Ponzi-like financial schemes where high returns to early investors are paid out
of funds received from later investors duped into believing they are themselves
receiving entry into a high-return investment scheme. The Madoff investment scandal is
an example of this kind of high-level embezzlement scheme, where it is alleged that
$65 billion was siphoned off from gullible investors and financial institutions.
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Safeguards Against Embezzlement
Internal controls such as separation of duties are common defences against
embezzlement. For example, at a movie theatre (cinema), the task of accepting money
and admitting customers into the theatre is typically broken up into two jobs. One
employee sells the ticket, and another employee takes the ticket and lets the customer
into the theatre. Because a ticket cannot be printed without entering the sale into the
computer (or, in earlier times, without using up a serial-numbered printed ticket), and
the customer cannot enter the theatre without a ticket, both of these employees would
have to collude in order for embezzlement to go undetected. This significantly reduces
the chance of theft, because of the added difficulty in arranging such a conspiracy and
the likely need to split the proceeds between the two employees, which reduces the
payoff for each.
Another obvious method to deter embezzlement is to regularly and unexpectedly move
funds from one advisor or entrusted person to another when the funds are supposed to
be available for withdrawal or use, to ensure that the full amount of the funds is
available and no fraction of the savings has been embezzled by the person to whom the
funds or savings have been entrusted.
England and Wales
Offences of embezzlement were formerly created by sections 18 and 19 of the Larceny
Act 1916.
The former offences of embezzlement are replaced by the new offence of theft, contrary
to section 1 of the Theft Act 1968.
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VII. Extortion
Extortion (also called shakedown, outwrestling and exaction) is a criminal offense of
obtaining money, property, or services from an individual or institution, through
coercion. It is sometimes euphemistically referred to as a "protection racket" since the
racketeers often phrase their demands as payment for "protection" from (real or
hypothetical) threats from unspecified other parties; though often, and almost always,
such "protection" is simply abstinence of harm from the same party, and such is implied
in the "protection" offer. Extortion is commonly practiced by organized crime groups.
The actual obtainment of money or property is not required to commit the offense.
Making a threat of violence which refers to a requirement of a payment of money or
property to halt future violence is sufficient to commit the offense. Exaction refers not
only to extortion or the demanding and obtaining of something through force, [1] but
additionally, in its formal definition, means the infliction of something such as pain and
suffering or making somebody endure something unpleasant.
The term extortion is often used metaphorically to
refer to usury or to price-gouging, though neither
is legally considered extortion. It is also often
used loosely to refer to everyday situations where
one person feels indebted against their will, to
another, in order to receive an essential service
or avoid legal consequences. Neither extortion
nor blackmail requires a threat of a criminal act,
such as violence, merely a threat used to elicit
actions, money, or property from the object of the
extortion. Such threats include the filing of reports
(true or not) of criminal behavior to the police, revelation of damaging facts (such as
pictures of the object of the extortion in a compromising position), etc.
In law, the word extortion can refer to political corruption, such as selling one's office or
influence peddling, but in general vocabulary the word usually first brings to mind
blackmail or protection rackets. The logical connection between the corruption sense of
the word and the other senses is that to demand bribes in one's official capacity is
blackmail or racketeering in essence (that is, "you need access to this resource, the
government restricts access to it through my office, and I will charge you unfairly and
unlawfully for such access").
United States
Extortion is distinguished from robbery. In robbery, whether armed or not, the offender
takes property from the victim by the immediate use of force or fear that force will be
immediately used (as in the classic line, "Your money or your life"). Extortion, which is
not limited to the taking of property, involves the verbal or written instillation of fear that
something will happen to the victim if they do not comply with the extortionist's will.
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Another key distinction is that extortion always involves a verbal or written threat,
whereas robbery does not. In United States federal law, extortion can be committed with
or without the use of force and with or without the use of a weapon.
In blackmail, which always involves extortion, the extortionist threatens to reveal
information about a victim or their family members that is potentially embarrassing,
socially damaging, or incriminating unless a demand for money, property, or services is
met.
In the United States, extortion may also be committed as a federal crime across a
computer system, phone, by mail, or in using any instrument of interstate commerce.
Extortion requires that the individual sent the message willingly and knowingly as
elements of the crime. The message only has to be sent (but does not have to reach the
intended recipient) to commit the crime of extortion.
England and Wales
United Kingdom
In England and Wales extorting property and money by coercion is the offence of
Blackmail which covers any "unwarranted demand with menaces" including physical
threats. See section 21 of the Theft Act 1968 plus sections 29 and 30 of the Larceny Act
1916. A group of people may also be committing conspiracy.
Scotland
Extortion is a common law offence in Scotland of using threat of harm to demand
money, property or some advantage from another person. It does not matter whether
the demand itself is legitimate (such as for money owed) as the offence can still be
committed when illegitimate threats of harm are used.
Cyberextortion
Cyberextortion is when an individual or group uses the internet as an offensive force.
The group or individual usually sends a company a threatening email stating that they
have received confidential information about their company and will exploit a security
leak or launch an attack that will harm the company's network. The message sent
through the email usually demands money in exchange for the prevention of the attack.
Cases
In March 2008, Anthony Digati was arrested on federal charges of extortion through
interstate communication. Digati put $50,000 into a variable life insurance policy by New
York Life Insurance Company and wanted a return of $198,303.88. When the firm didn't
comply, he threatened to send out 6 million spam emails. He registered a domain in
February 2008 that contained New York Life's name in the URL to display false public
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statements about the company and increased his demand to $3 million. According to
prosecutors, Digati's intent was not to inform or educate but he wanted to "damage the
reputation of New York Life and cost the company millions of dollars in revenue,”. New
York Life contacted the Federal Bureau of Investigation and Digati was apprehended.
from Nintendo.
On February 15, 2011, Spanish police
apprehended a man who attempted to
blackmail Nintendo over customer
information he had stolen. The man stole
personal information about 4,000 users and
emailed Nintendo Ibérica, Nintendo's Spanish
division, and accused the company of data
negligence. He threatened the company that
he would make the information public and
complain to the Spanish Data Agency if his
demands were not met. After Nintendo
ignored his demands, he published some of
the information on an Internet forum.
Nintendo notified authorities and the man
was arrested in Málaga. No information has
been revealed as to what the man demanded
On February 7, 2019, Jeffrey P. Bezos, owner of Amazon and The Washington Post,
accused the National Enquirer and its parent company American Media, Inc., of
attempting to extort him by threatening to reveal nude pictures of him unless he publicly
stated that he “[has] no knowledge or basis for suggesting that AMI’s coverage was
politically motivated or influenced by political forces.” This threat was in response to Mr.
Bezos investigating the tabloid for publishing details about his relationship with Lauren
Sanchez, which led to Mr. Bezos and his wife Mackenzie announcing their divorce on
January 9 of that year. Mr. Bezos, the richest man in the world at the time, refused, and
posted the threat on Medium.
Similar Crimes
Badger Game: The victim or "mark"—for example, such as a married person—is
tricked into a compromising position to make them vulnerable to blackmail.
Clip Joint: A clip joint or fleshpot is an establishment, usually a strip club or
entertainment bar, typically one claiming to offer adult entertainment or bottle
service, in which customers are tricked into paying money and receive poor
goods or services, or none, in return. An example of this is portrayed in the
comedy film Porky's
Coercion: the practice of compelling a person or manipulating them to behave in
an involuntary way (whether through action or inaction) by use of threats,
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intimidation, trickery, or some other form of pressure or force. These are used as
leverage, to force the victim to act in the desired way.
Confidence Trick (also known as a bunko, con, flim flam, gaffle, grift, hustle,
scam, scheme, swindle, bamboozle or finnese): an attempt to defraud a person
or group by gaining their confidence.
Cryptovirology: a software scam in which a public key cryptography system
crafts fake keys which encrypt the user's data, but cannot decrypt them unless
the user pays for the real key.
Dognapping: The crime of taking a dog from its owner, which usually occurs in
purebred dogs, the profit from which can run up to thousands of dollars.
Loan Sharking: A loan shark is a person or body that offers unsecured loans at
high interest rates to individuals, often backed by blackmail or threats of violence.
Price Gouging: a pejorative term for a seller pricing much higher than is
considered reasonable or fair. In precise, legal usage, it is the name of a felony
that applies in some of the United States only during civil emergencies.
Racket: A service that is fraudulently offered to solve a problem, such as for a
problem that does not actually exist, will not be affected, or would not otherwise
exist.
Sextortion: Forcing individuals to send sexual images or perform sexual
services
Terrorism: most simply, policy intended to intimidate or cause terror. It is more
commonly understood as an act which is intended to create fear (terror), is
perpetrated for an ideological goal (as opposed to a materialistic goal or a lone
attack), and deliberately target or disregard the safety of non-combatants. Some
definitions also include acts of unlawful violence or unconventional warfare, but
at present, the international community has been unable to formulate a
universally agreed, legally binding, criminal law definition of terrorism.
Tiger Kidnapping: the taking of an innocent hostage to make a loved one or
associate of the victim do something, e.g. a child is taken hostage to force the
shopkeeper to open the safe; the term originates from the prior observation of the
victim, like a tiger does with its prey. Ransoms are often used alongside these.
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VIII. Fencing Stolen Goods
A fence, also known as a receiver, mover, or moving man, is an individual who
knowingly buys stolen goods in order to later resell them for profit. The fence acts as a
middleman between thieves and the eventual buyers of stolen goods who may not be
aware that the goods are stolen. As a verb, the word describes the behavior of the thief
in the transaction: The burglar fenced the stolen radio. This sense of the term came
from thieves' slang, first attested c. 1700, from the notion of such transactions providing
a defense against being caught. The term remains in common use in all major dialects
of modern English, all of which spell it with a "c" even though the source word in some
dialects (particularly American English) is now spelled defense.
The fence is able
to make a profit
with stolen
merchandise
because he/she is
able to secretly
pay thieves a very
low price for "hot"
goods that cannot
be easily sold on
the open markets.
The thieves who
patronize the
fence are willing
to accept a low
profit margin in
order to reduce
their risks by
instantly "washing their hands" of the black market loot and disassociating themselves
from the criminal act that procured it. After the sale, the fence recoups their investment
by disguising the stolen nature of the goods (via methods such as repackaging and
altering/effacing serial numbers) and reselling the goods as near to the white market
price as possible without drawing suspicion. This process often relies on a legal
business (such as a pawnshop, flea market or street vendor) in order to "launder" the
stolen goods by intermixing them with legally-purchased items of the same type.
Fencing is illegal in all countries, but legally proving a violation of anti-fencing laws can
be difficult.
Approach
The fence is able to make a profit with stolen merchandise because he is able to pay
thieves a very low price for stolen goods. Thieves agree to this because their
alternatives may present a greater risk of the thief being caught. As well, selling stolen
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goods takes a great deal of time and effort (transaction costs), as the thief would have
to try to contact a number of potential buyers and show them the merchandise. Some
habitual thieves are so well known to police that if the thief were to attempt to sell any
used goods, this would quickly draw the attention of law enforcement.
The fence then disguises the stolen nature of the goods, if possible, so that he or she
can sell them closer to the market price. Depending on the stolen item, the fence may
attempt to remove, deface, or replace serial numbers on the stolen item before reselling
it. In some cases, fences will transport the stolen items to a different city to sell them,
because this lessens the likelihood that the items will be recognized. For some types of
stolen goods, fences disassemble the good and sell the individual parts, because the
sale of parts is less risky. For example, a stolen car or bicycle may be disassembled so
that the parts can be sold individually. Another tactic used by some fences is to retain
stolen items for some time before selling them, which lessens the likelihood that the
burglary victims or police will be actively looking for the items in auctions and
pawnshops.
Fencing is often conducted through legal businesses. Some fences maintain a
legitimate-seeming "front" through which they can sell stolen merchandise. Depending
on the type of stolen merchandise a fence deals in, "front" businesses might be discount
stores, used goods stores, a coin and gem store, auction house, flea market, or auto
salvage yards. The degree of illicit activity in each "front" business may differ from fence
to fence. While one fence's salvage yard may consist mainly of stolen auto parts,
another fence's used goods store might consist mainly of legitimately purchased used
goods, with the stolen merchandise acting as a minor, but profitable, sideline.
The prices fences pay thieves typically depend both on norms and on legitimate market
rates for the items in question. Vulnerable sellers, such as drug addicts or casual
thieves, may receive less than 20% of an item's value. Higher prices, sometimes as
high as 50% of an item's value in a legal market, can be commanded by a professional
thief, especially one who concentrates on valuable items. At the same time, fences will
often take advantage of thieves by deceiving them about the value of an individual item
and the relevant market conditions. For example, a fence may falsely tell a petty thief
that the market for the type of good which the thief is selling is flooded with this type of
merchandise, to justify paying out a lower price.
Research on fences shows that they view themselves as entrepreneurs, relying on
networking with and patronage by prominent criminals to become successful in their
word-of-mouth-based "wheeling and dealing". They occupy the middle ground between
the criminal world (thieves, burglars and shoplifters) and the legitimate world (e.g.,
everyday people who purchase used goods). Some active fences go farther in their
business, maintaining longstanding contacts and even teaching thieves how to practice
their craft, whether by identifying specific products or by teaching them tools of the
trade.
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There are a number of different types of fences. One way of categorizing fences is by
the type of good in which they trade, such as jewels, power tools, or electronics.
Another way of categorizing fences is by their level of involvement in buying and selling
stolen goods; for some, fencing is an occasional "sideline" activity, while it is an
economic mainstay for others.
At the lowest level, a hustler or drug dealer may occasionally accept stolen goods. At
the highest level would be a fence whose main criminal income comes from buying and
selling stolen items. At the broadest level, two tiers of fences can be distinguished. The
lower level of fences are those who directly buy stolen goods from thieves and burglars.
At a higher level are the "master fences", who do not deal with street-level thieves, but
only with other fences.
The degree to which the purchasers of the stolen goods know or suspect that the items
are stolen varies. If a purchaser buys a high-quality item for a low price, in cash, from a
stranger at a bar or from the back of a van, there is a higher likelihood that the items
may be stolen.
On the other hand, if a purchaser buys the same high-quality item for the standard retail
price from a used goods store, and obtains a proper receipt, the purchaser may
reasonably believe that the item is not stolen (even if, in fact, it is a stolen item).
History of Receiving
The fence, or receiver, is an old kind of criminal, historically attested in many countries
and with deep and complex dynamics within society.
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Early Modern England
Receiving was a widespread crime in Modern England and an increasingly crucial
concern for the English government of that period. It involved many other kinds of
activities and crimes, and it saw its peak in the early 18th century with the notorious
Jonathan Wild. Receiving is intrinsically connected to theft, as receivers, by definition,
buy previously stolen goods in order to make profit out of them later. When organized
theft grew increasingly important in London thanks to largely supportive receivers, the
establishment started to fight it off with new laws, often aimed at receivers: receiving
was acknowledged as the very core of property crime.
Receiving was not considered as a felony (crime) in common law until 1691, when
fences became potential targets of charges as accessories to theft. This meant that in
order to judge a suspected receiver, it was necessary to condemn the related thief first.
Later laws further focused on receivers, especially the 1718 Transportation Act, which,
together with other measures, made fences main felons and not simply accessories to
other felonies. Nonetheless, it was not easy to prove that a dealer knowingly accepted
stolen goods, especially without the related theft event being fully cleared out.
Proceedings stored in the Old Bailey Online archive where the offence category is
receiving are 5664. Of these, 1973 have a verdict category of guilty.
The 1718 Transportation Act also made a felony of returning goods for a fee, revealing
that by then, receiving had already been widely taken to the next stage: returning goods
to their owner, for a fee, instead of selling them in the second-hand market. Thieves
could act as go-betweens themselves, but go-betweens could raise some suspicions,
while relying on receivers added a safety layer against effective prosecution. A victim of
theft was often willing to pay in order to get his goods back, in order to spare himself
further troubles and/or if the items taken had the potential to reveal unflattering details
about his personal affairs. In addition to that, for many centuries, prosecution in England
was entirely at the expense (of personal money, time and effort) of the prosecutor.
Therefore, also considering the difficulty of actually proving receiving in courts, common
people, especially shopkeepers, often preferred compounding, feeling that prosecuting
was not worth it. This gave a considerable advantage to receivers.
In order to effectively act as go-betweens for compounding, or brokers, fences needed
to personally know thieves or have ways to easily interact and bargain with them for a
common benefit about compounding: nobody was in a better position to do so than
thief-takers. Thief-takers grew increasingly notorious in England as a reward was
introduced by the Crown for each successfully condemned criminal. Some of them,
such as Anthony Dunn, publicly referred to as "pretended Thiefe-taker" in a 1707
document, used their social power as thief-takers as an advantage for receiving. Thieftakers
were usually so involved with thieves and gangs of thieves that they could easily
condemn them for the reward, or use this power to intimidate and command thieves to
do their biddings: in exchange of clemency or protection from capture or condemnation,
they could have thieves to steal under their command. Indeed, thief-takers could act as
direct instigators, supporting their thieves with intelligence or offering them shelter at
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need (when convenient), and then act as receivers with the stolen goods. Through
parallel occupations, receivers could feed their own business.
Confirmation of how thief-taking and receiving were tightly connected could be seen in
the career of Charles Hitchen, who was known as a thief-taker. He bought off the
position of Under City Marshal through his wife's money in order to have one of the best
positions amongst the thief-takers of the City. However, a vast part of his income
actually came from the receiving activity related to the network of connections with
London's underworld. Hitchen controlled this network through his official (that is to say,
legal) position as a thief-taker.
The synergy between receiving, theft and corruption, as well as official activities such as
thief-taking or pawnbroking was a huge dynamic bond where each element enhanced
the others in a vicious circle.
The master of this powerful synergy of London underworld was Jonathan Wild, who
rapidly replaced his previous master, Charles Hitchen, in 1713, and rapidly gained
control of London's crime and the title of "thief-taker general". His power was due to his
ruthless thief-taking and intimidation activities as well as a complex web of intelligence
also built around the diffusion of newspapers. However, overly bold receiving was his
undoing, as it grew so large and complex a matter to prompt the English government to
promote further laws against receiving and related activities, such as the Transportation
Act in 1718, also known as "Jonathan Wild Act", and its extension in 1720, which made
returning goods for a fee a felony of the same importance and punishment as the crime
(theft) related to the goods returned (which meant a capital offence in most cases, with
raised potential reward for definitive evidence, from £40 to £140). Eventually, the
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government decided to directly take action against Wild through lawyers, succeeding in
condemning and executing him in 1725.
Women and Receiving
There is no registered case of female fences of the same fame of Wild or Hitchen.
However, women had active roles in both receiving and theft. Elizabeth Hitchen,
Hitchen's wife, gave her inheritance money to her husband in order to buy the Under
City Marshal office for his plans. Moreover, women could also be active fences. For
example, Elizabeth Fisher managed her own receiving business in her husband's
alehouse. Proceedings stored in the Old Bailey Online archive where the offence
category is receiving are 5664. Of these, 1858 have a defendant gender category of
female.
Early Modern English Literature
Receiving grew increasingly important in Early Modern society, and combined with the
increasing interest of society on reading, it became the source for many writers, such as
Daniel Defoe, with Moll Flanders and John Gay, with The Beggar's Opera. These works
reflect how receiving was conceived and portrayed by authors.
Moll Flanders
Moll Flanders is a novel intended to narrate the whole life of its protagonist, referred to
as Moll Flanders, but a relevant part of it is about her becoming a master thief. Moll's
activity as a thief largely relied on the protection and support of her governess, who
acted also as a receiver for the goods stolen by her affiliates. She is the one who buys
Moll's stolen goods the first time, as Moll narrates "I was now at a loss for a market for
my goods,[...] At last I resolved to go to my old governess." Therefore, the governess
character sealed Moll's fate as a thief, and eventually taught her the basics of thievery
redirecting Moll to work with other senior thieves. With these events, Defoe shows how
crucial as well as subtle receiving was in building the whole of crime activity in London.
The Governess is officially a pawnbroker, and she uses this legal business to recycle
stolen goods into the secondary market. Sometimes, such as in the case of a silver
inscribed mug stolen by Moll, she smelts metals, in order to avoid getting caught while
re-selling. Along with receiving activity, she actively protects and support many criminals
and thieves in order to secure a steady income to her activity.
The same governess goes on in protecting and offering refuge to her affiliates whenever
possible, or recruiting thieves into small groups, always via middlemen, in order to
protect their thieves' identities in case some of them were caught and willing to confess.
She is also a main intelligence source and often a direct instigator to theft such as in a
case of fire in a well-off house in the neighborhood (more vulnerable to theft because of
the sudden emergency), and finally becomes a broker for goods stolen by Moll to a
drunken gentleman. In that case, the amount gained is allegedly greater than what she
would have gained by standard re-selling in the secondary market.
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The Governess embodies female social cunning in London's underworld, from Defoe's
point of view. She is a typical receiver of her time, and whereas many male receivers
used thief-taking as an official business, she relies on pawnbroking.
Legal Aspects
Fencing is illegal almost everywhere, usually under a similar rationale as in the United
States, where receipt of stolen property is a crime in every state, as well as a federal
crime if the property crossed a state line. Occasionally federal agents will temporarily
set up a false fence sting operation. Fencing is a common source of income for
organized crime. In England and Wales, as in many U.S. states, the crime requires
three elements: stolen property, the receiver's act of receiving or hiding it, and his
knowledge of its stolen status.
Pawnbrokers have often been associated with fencing, though in many jurisdictions,
government identification must be shown in order to pawn an item and police regularly
check pawnshops for stolen goods and repossess any stolen items.
While pawnbrokers do not like this characterization of their business, police efforts have
indicated that some pawnbrokers are involved in fencing.
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E-fencing
E-fencing is the sale of items on the Internet that have been obtained illegally. It is an
activity that criminals often mix with sales to pawnbrokers. The auction website eBay,
being easy to reach for the average thief, is a popular location for e-fencing; customers
reported more than eight thousand crimes from the website in 2008, many of which
involved the sale of stolen property. Classified websites like Craigslist, AutoTrader.com,
Pennysaver online, etc. are some of the Internet sources used for fencing goods online
and circumventing the middleman fencer, in addition to a number of illegal darknet
markets.
E-fenced items may be shoplifted or otherwise stolen, alternatively they may be
purchased using stolen credit cards or similar banking information. The latter practice is
often intertwined with carding, which is the trafficking of thousands or even millions of
stolen credit card numbers. The sale of stolen credit cards, which usually takes place on
the darknet markets, is generally considered to be a form of e-fencing in its own right,
and often plays a role in supplying the data used to purchase physical goods that may
be either e-fenced themselves or fenced through more traditional means.
Crime rings steal and/or use stolen financial information to pay for in-demand items
from retailers and then sell them online, relying on the Internet's ability to reach buyers
around the world and its anonymity; some theft rings even take pre-orders, confident
that they can steal and/or fraudulently pay for whatever is currently in demand. In the
United States, major retailers such as Wal-Mart and Target have advocated for federal
legislation to combat Internet fencing. Proposals for such legislation have often
proposed requiring major sales websites (e.g. eBay and Amazon.com) to retain some
items' serial numbers and to release information to retailers about major sellers whom
the retailers believe to be relying on stolen property. Such proposals have been
opposed by the online retailers who would be required to maintain these records and
take these actions.
An eBay spokesman has stated, "Perhaps the dumbest place to try to fence stolen
materials is on eBay," and news agencies have reported incidents of the police
purchasing stolen property directly from thieves, leading to their capture. By early 2007,
e-fencing had become a $37 billion business.
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IX. Fraud
In law, fraud is deliberate deception to secure unfair or unlawful gain, or to deprive a
victim of a legal right. Fraud itself can be a civil wrong (i.e., a fraud victim may sue the
fraud perpetrator to avoid the fraud or recover monetary compensation), a criminal
wrong (i.e., a fraud perpetrator may be prosecuted and imprisoned by governmental
authorities), or it may cause no loss of money, property or legal right but still be an
element of another civil or criminal wrong. The purpose of fraud may be monetary gain
or other benefits, such as obtaining a passport or travel document, driver's license or
qualifying for a mortgage by way of false statements.
A hoax is a distinct concept that involves deliberate deception without the intention of
gain or of materially damaging or depriving a victim.
As a Civil Wrong
In common law jurisdictions, as a civil wrong, fraud is a tort. While the precise
definitions and requirements of proof vary among jurisdictions, the requisite elements of
fraud as a tort generally are the intentional misrepresentation or concealment of an
important fact upon which the victim is meant to rely, and in fact does rely, to the harm
of the victim. Proving fraud in a court of law is often said to be difficult. That difficulty is
found, for instance, in that each and every one of the elements of fraud must be proven,
that the elements include proving the states of mind of the perpetrator and the victim,
and that some jurisdictions require the victim to prove fraud by clear and convincing
evidence.
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The remedies for fraud may include rescission (i.e., reversal) of a fraudulently obtained
agreement or transaction, the recovery of a monetary award to compensate for the
harm caused, punitive damages to punish or deter the misconduct, and possibly others.
In cases of a fraudulently induced contract, fraud may serve as a defense in a civil
action for breach of contract or specific performance of contract.
Fraud may serve as a basis for a court to invoke its equitable jurisdiction.
As a Criminal Offence
In common law jurisdictions, as a criminal offence, fraud takes many different forms,
some general (e.g., theft by false pretense) and some specific to particular categories of
victims or misconduct (e.g., bank fraud, insurance fraud, forgery). The elements of fraud
as a crime similarly vary. The requisite elements of perhaps the most general form of
criminal fraud, theft by false pretense, are the intentional deception of a victim by false
representation or pretense with the intent of persuading the victim to part with property
and with the victim parting with property in reliance on the representation or pretense
and with the perpetrator intending to keep the property from the victim.
Canada
By Region
North America
Section 380(1) of the Criminal Code provides the general definition for fraud in Canada:
380. (1) Every one who, by deceit, falsehood or other fraudulent means, whether or not
it is a false pretense within the meaning of this Act, defrauds the public or any person,
whether ascertained or not, of any property, money or valuable security or any service,
(a) is guilty of an indictable offence and liable to a term of imprisonment not
exceeding fourteen years, where the subject-matter of the offence is a
testamentary instrument or the value of the subject-matter of the offence exceeds
five thousand dollars; or
(b) is guilty
(i) of an indictable offence and is liable to imprisonment for a term not
exceeding two years, or
(ii) of an offence punishable on summary conviction, where the value of
the subject-matter of the offence does not exceed five thousand dollars.
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In addition to the penalties outlined above, the court can also issue a prohibition order
under s. 380.2 (preventing a person from "seeking, obtaining or continuing any
employment, or becoming or being a volunteer in any capacity, that involves having
authority over the real property, money or valuable security of another person"). It can
also make a restitution order under s. 380.3.
The Canadian courts have held that the offence consists of two distinct elements:
A prohibited act of deceit, falsehood or other fraudulent means. In the absence of
deceit or falsehood, the courts will look objectively for a "dishonest act"; and
The deprivation must be caused by the prohibited act, and deprivation must
relate to property, money, valuable security, or any service.
The Supreme Court of Canada has held that deprivation is satisfied on proof of
detriment, prejudice or risk of prejudice; it is not essential that there be actual loss.
Deprivation of confidential information, in the nature of a trade secret or copyrighted
material that has commercial value, has also been held to fall within the scope of the
offence.
Criminal Fraud
United States
The proof requirements for criminal fraud charges in the United States are essentially
the same as the requirements for other crimes: guilt must be proved beyond a
reasonable doubt. Throughout the United States fraud charges can be misdemeanors
or felonies depending on the amount of loss involved. High value frauds can also
include additional penalties. For example, in California losses of $500,000 or more will
result in an extra two, three, or five years in prison in addition to the regular penalty for
the fraud.
The U.S. government's 2006 fraud review concluded that fraud is a significantly underreported
crime, and while various agencies and organizations were attempting to tackle
the issue, greater co-operation was needed to achieve a real impact in the public sector.
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The scale of the problem pointed to the need for a small but high-powered body to bring
together the numerous counter-fraud initiatives that existed.
According to Bloomberg, auto loan application fraud rates in the United States has been
steadily rising over the past few years. This type of fraud expected to double from about
$2–3 billion in 2015 to $4–6 billion in 2017.
Civil Fraud
Although elements may vary by jurisdiction and the specific allegations made by a
plaintiff who files a lawsuit that alleged fraud, typical elements of a fraud case in the
United States are that:
1. Somebody misrepresents a material fact in order to obtain action or forbearance
by another person;
2. The other person relies upon the misrepresentation; and
3. The other person suffers injury as a result of the act or forbearance taken in
reliance upon the misrepresentation.
To establish a civil claim of fraud, most jurisdictions in the United States require that
each element of a fraud claim be pleaded with particularity and be proved by a
preponderance of the evidence, meaning that it is more likely than not that the fraud
occurred.
Some jurisdictions impose a higher evidentiary standard, such as Washington State's
requirement that the elements of fraud be proved with clear, cogent, and convincing
evidence (very probable evidence), or Pennsylvania's requirement that common law
fraud be proved by clear and convincing evidence.
The measure of damages in fraud cases is normally computed using one of two rules:
1. The "benefit of bargain" rule, which allows for recovery of damages in the amount
of the difference between the value of the property had it been as represented
and its actual value;
2. Out-of-pocket loss, which allows for the recovery of damages in the amount of
the difference between the value of what was given and the value of what was
received.
Special damages may be allowed if shown to have been proximately caused by
defendant's fraud and the damage amounts are proved with specificity.
Many jurisdictions permit a plaintiff in a fraud case to seek punitive or exemplary
damages.
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Pacific Asia
China
Zhang Yingyu's story collection The Book of Swindles (available here; ca. 1617) testifies
to rampant commercial fraud, especially involving itinerant businessmen, in late Ming
China. The journal Science reported in 2017 that fraud is rife in Chinese academia,
resulting in numerous article retractions and harm to China's international prestige. The
Economist, CNN, and other media outlets regularly report on incidents of fraud or bad
faith in Chinese business and trade practices. Forbes cites cybercrime as a persistent
and growing threat to Chinese consumers.
United Kingdom
Europe
In 2016 the estimated value lost through fraud in the UK was £193 billion a year.
In January 2018 the Financial Times reported that the value of UK fraud hit a 15-year
high of £2.11bn in 2017 according to a study. The article said that the accountancy firm
BDO examined reported fraud cases worth more than £50,000 and found that the total
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number rose to 577 in 2017, compared with 212 in 2003. The study found that the
average amount stolen in each incident rose to £3.66m, up from £1.5m in 2003.
As at November 2017 Fraud is the most common criminal offence in the UK according
to a study by Crowe Clark Whitehill, Experian and the Centre for Counter Fraud Studies.
The study suggests the UK loses over £190 billion per year to fraud. £190 billion is more
than 9% of the UK’s projected GDP for 2017 ($2,496 (£2,080) billion according to
Statistics Times). The estimate for fraud in the UK figure is more than the entire GDP of
countries such as Romania, Qatar and Hungary.
According to another review by the UK anti-fraud charity Fraud Advisory Panel (FAP),
business fraud accounted for £144bn, while fraud against individuals was estimated at
£9.7bn. The FAP has been particularly critical of the support available from the police to
victims of fraud in the UK outside of London. Although victims of fraud are generally
referred to the UK's national fraud and cyber crime reporting centre, Action Fraud, the
FAP found that there was "little chance" that these crime reports would be followed up
with any kind of substantive law enforcement action by UK authorities, according to the
report.
In July 2016 it was reported that fraudulent activity levels in the UK increased in the 10
years to 2016 from £52 billion to £193bn. This figure would be a conservative estimate,
since as the former commissioner of the City of London Police, Adrian Leppard, has
said, only 1 in 12 such crimes are actually reported. Donald Toon, director of the NCA's
economic crime command, stated in July 2016: "The annual losses to the UK from fraud
are estimated to be more than £190bn". Figures released in October 2015 from the
Crime Survey of England and Wales found that there had been 5.1 million incidents of
fraud in England and Wales in the previous year, affecting an estimated one in 12 adults
and making it the most common form of crime.
Also in July 2016, the Office for National Statistics (ONS) stated "Almost six million
fraud and cyber crimes were committed last year in England and Wales and estimated
there were two million computer misuse offences and 3.8 million fraud offences in the
12 months to the end of March 2016." Fraud affects one in ten people in the UK.
According to the ONS most frauds relate to bank account fraud. These figures are
separate from the headline estimate that another 6.3 million crimes (distinct from frauds)
were perpetrated in the UK against adults in the year to March 2016.
Fraud was not included in a "Crime Harm Index" published by the Office for National
Statistics in 2016. Michael Levi, professor of criminology at Cardiff University, remarked
in August 2016 that it was ‘deeply regrettable’ fraud is being left out of the first index
despite being the most common crime reported to police in the UK. Levi said ‘If you’ve
got some categories that are excluded, they are automatically left out of the police’s
priorities.’. The Chief of the National Audit Office (NAO), Sir Anyas Morse has also said
“For too long, as a low-value but high-volume crime, online fraud has been overlooked
by government, law enforcement and industry. It is now the most commonly
experienced crime in England and Wales and demands an urgent response.”
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England, Wales, and Northern Ireland
Since 2007, fraud in England and Wales and Northern Ireland has been covered by the
Fraud Act 2006. The Act was given Royal Assent on 8 November 2006, and came into
effect on 15 January 2007.
The Act gives a statutory definition of the criminal offence of fraud, defining it in three
classes—fraud by false representation, fraud by failing to disclose information, and
fraud by abuse of position. It provides that a person found guilty of fraud is liable to a
fine or imprisonment for up to twelve months on summary conviction (six months in
Northern Ireland), or a fine or
imprisonment for up to ten years
on conviction on indictment.
This Act largely replaces the
laws relating to obtaining
property by deception, obtaining
a pecuniary advantage and
other offences that were created
under the Theft Act 1978.
Serious Fraud Office
Scotland
In Scots law, fraud is covered
under the common law and a
number of statutory offences.
The main fraud offences are
common law fraud, uttering,
embezzlement and statutory
frauds. The Fraud Act 2006
does not apply in Scotland.
The Serious Fraud Office (United Kingdom) is an arm of the Government of the United
Kingdom, accountable to the Attorney-General.
National Fraud Authority
The National Fraud Authority (NFA) was, until 2014, a government agency co-ordinating
the counter-fraud response in the UK.
Cifas
Cifas is a British fraud prevention service, a not-for-profit membership organization for
all sectors that enables organizations to share and access fraud data using their
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databases. Cifas is dedicated to the prevention of fraud, including internal fraud by staff,
and the identification of financial and related crime.
Cost
The typical organization loses five percent of its annual revenue to fraud, with a median
loss of $160,000. Frauds committed by owners and executives were more than nine
times as costly as employee fraud. The industries most commonly affected are banking,
manufacturing, and government.
Types of Fraudulent Acts
The falsification of documents, forgery or counterfeiting are types of fraud. The theft of
one's personal information, like Social Security number, or identity is type of fraud.
Fraud can be committed through many media, including mail, wire, phone, and the
Internet (computer crime and Internet fraud). International dimensions of the web and
ease with which users can hide their location, the difficulty of checking identity and
legitimacy online, and the simplicity with which hackers can divert browsers to dishonest
sites and steal credit card details have all contributed to the very rapid growth of Internet
fraud. In some countries, tax fraud is also prosecuted under false billing or tax forgery.
There have also been fraudulent "discoveries", e.g., in science, to gain prestige rather
than immediate monetary gain.
Anti-Fraud Movements
Beyond laws that aim at prevention of fraud, there are also governmental and nongovernmental
organizations that aim to fight fraud. Between 1911 and 1933, 47 states
adopted the so-called Blue Sky Laws status. These laws were enacted and enforced at
the state level and regulated the offering and sale of securities to protect the public from
fraud. Though the specific provisions of these laws varied among states, they all
required the registration of all securities offerings and sales, as well as of every U.S.
stockbroker and brokerage firm. However, these Blue Sky laws were generally found to
be ineffective. To increase public trust in the capital markets the President of the United
States, Franklin D. Roosevelt, established the U.S. Securities and Exchange
Commission (SEC). The main reason for the creation of the SEC was to regulate the
stock market and prevent corporate abuses relating to the offering and sale of securities
and corporate reporting. The SEC was given the power to license and regulate stock
exchanges, the companies whose securities traded on them, and the brokers and
dealers who conducted the trading.
Detection
For detection of fraudulent activities on the large scale, massive use of (online) data
analysis is required, in particular predictive analytics or forensic analytics. Forensic
analytics is the use of electronic data to reconstruct or detect financial fraud. The steps
in the process are data collection, data preparation, data analysis, and the preparation
of a report and possibly a presentation of the results. Using computer-based analytic
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methods Nigrini's wider goal is the detection of fraud, errors, anomalies, inefficiencies,
and biases which refer to people gravitating to certain dollar amounts to get past
internal control thresholds.
The analytic tests usually start with high-level data overview tests to spot highly
significant irregularities. In a recent purchasing card application these tests identified a
purchasing card transaction for 3,000,000 Costa Rica Colons. This was neither a fraud
nor an error, but it was a highly unusual amount for a purchasing card transaction.
These high-level tests include tests related to Benford's Law and possibly also those
statistics known as descriptive statistics. These high-tests are always followed by more
focused tests to look for small samples of highly irregular transactions. The familiar
methods of correlation and time-series analysis can also be used to detect fraud and
other irregularities. Forensic analytics also includes the use of a fraud risk-scoring
model to identify high risk forensic units (customers, employees, locations, insurance
claims and so on). Forensic analytics also includes suggested tests to identify financial
statement irregularities, but the general rule is that analytic methods alone are not too
successful at detecting financial statement fraud.
Related
Apart from fraud, there are several related categories of intentional deceptions that may
or may not include the elements of personal gain or damage to another individual:
Obstruction of justice
18 U.S.C. § 704 which criminalizes false representation of having been awarded
any decoration or medal authorized by Congress for the Armed Forces of the
United States
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X. Identity Theft
Identity theft is the deliberate use of someone else's identity, usually as a method to
gain a financial advantage or obtain credit and other benefits in the other person's
name, and perhaps to the other person's disadvantage or loss. The person whose
identity has been assumed may suffer adverse consequences, especially if they are
held responsible for the perpetrator's actions. Identity theft occurs when someone uses
another's personally identifying information, like their name, identifying number, or credit
card number, without their permission, to commit fraud or other crimes. The term
identity theft was coined in 1964. Since that time, the definition of identity theft has been
statutorily prescribed throughout both the U.K. and the United States as the theft of
personally identifying information, generally including a person’s name, date of birth,
social security number, driver’s license number, bank account or credit card numbers,
PIN numbers, electronic signatures, fingerprints, passwords, or any other information
that can be used to access a person’s financial resources.
Determining the link between data breaches and identity theft is challenging, primarily
because identity theft victims often do not know how their personal information was
obtained, and identity theft is not always detectable by the individual victims, according
to a report done for the FTC. Identity fraud is often but not necessarily the consequence
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of identity theft. Someone can steal or misappropriate personal information without then
committing identity theft using the information about every person, such as when a
major data breach occurs. A US Government Accountability Office study determined
that "most breaches have not resulted in detected incidents of identity theft". The report
also warned that "the full extent is unknown". A later unpublished study by Carnegie
Mellon University noted that "Most often, the causes of identity theft is not known", but
reported that someone else concluded that "the probability of becoming a victim to
identity theft as a result of a data breach is ... around only 2%". More recently, an
association of consumer data companies noted that one of the largest data breaches
ever, accounting for over four million records, resulted in only about 1,800 instances of
identity theft, according to the company whose systems were breached.
An October 2010 article entitled "Cyber Crime Made Easy" explained the level to which
hackers are using malicious software. As Gunter Ollmann, Chief Technology Officer of
security at Microsoft, said, "Interested in credit card theft? There's an app for that." This
statement summed up the ease with which these hackers are accessing all kinds of
information online. The new program for infecting users' computers was called Zeus;
and the program is so hacker-friendly that even an inexperienced hacker can operate it.
Although the hacking program is easy to use, that fact does not diminish the devastating
effects that Zeus (or other software like Zeus) can do to a computer and the user. For
example, the article stated that programs like Zeus can steal credit card information,
important documents, and even documents necessary for homeland security. If the
hacker were to gain this information, it would mean identity theft or even a possible
terrorist attack. The ITAC says that about 15 million Americans are having their identity
stolen, in 2012.
Types
Sources such as the non-profit Identity Theft Resource Center sub-divide identity theft
into five categories:
Criminal identity theft (posing as another person when apprehended for a crime)
Financial identity theft (using another's identity to obtain credit, goods and
services)
Identity cloning (using another's information to assume his or her identity in daily
life)
Medical identity theft (using another's identity to obtain medical care or drugs)
Child identity theft.
Identity theft may be used to facilitate or fund other crimes including illegal immigration,
terrorism, phishing and espionage. There are cases of identity cloning to attack
payment systems, including online credit card processing and medical insurance. [12]
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Identity Cloning and Concealment
In this situation the identity thief impersonates someone else in order to conceal their
own true identity. Examples are illegal immigrants hiding their illegal status, people
hiding from creditors or other individuals, and those who simply want to become
"anonymous" for personal reasons. Another example is posers, a label given to people
who use someone else's photos and information on social networking sites. Posers
mostly create believable stories involving friends of the real person they are imitating.
Unlike identity theft used to obtain credit which usually comes to light when the debts
mount, concealment may continue indefinitely without being detected, particularly if the
identity thief is able to obtain false credentials in order to pass various authentication
tests in everyday life.
Criminal Identity Theft
When a criminal fraudulently identifies themselves to police as another individual at the
point of arrest, it is sometimes referred to as "Criminal Identity Theft." In some cases,
criminals have previously obtained state-issued identity documents using credentials
stolen from others, or have simply presented a fake ID. Provided the subterfuge works,
charges may be placed under the victim's name, letting the criminal off the hook.
Victims might only learn of such incidents by chance, for example by receiving a court
summons, discovering their drivers licenses are suspended when stopped for minor
traffic violations, or through background checks performed for employment purposes.
It can be difficult for the victim of a criminal identity theft to clear their record. The steps
required to clear the victim's incorrect criminal record depend in which jurisdiction the
crime occurred and whether the true identity of the criminal can be determined. The
victim might need to locate the original arresting officers and prove their own identity by
some reliable means such as fingerprinting or DNA testing, and may need to go to a
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court hearing to be cleared of the charges. Obtaining an expungement of court records
may also be required. Authorities might permanently maintain the victim's name as an
alias for the criminal's true identity in their criminal records databases. One problem that
victims of criminal identity theft may encounter is that various data aggregators might
still have the incorrect criminal records in their databases even after court and police
records are corrected. Thus it is possible that a future background check will return the
incorrect criminal records. This is just one example of the kinds of impact that may
continue to affect the victims of identity theft for some months or even years after the
crime, aside from the psychological trauma that being 'cloned' typically engenders.
Synthetic Identity Theft
A variation of identity theft which has recently become more common is synthetic
identity theft, in which identities are completely or partially fabricated. The most common
technique involves combining a real social security number with a name and birthdate
other than the ones associated with the number. Synthetic identity theft is more difficult
to track as it doesn't show on either person's credit report directly but may appear as an
entirely new file in the credit bureau or as a subfile on one of the victim's credit reports.
Synthetic identity theft primarily harms the creditors who unwittingly grant the fraudsters
credit. Individual victims can be affected if their names become confused with the
synthetic identities, or if negative information in their subfiles impacts their credit ratings.
Medical Identity Theft
Privacy researcher Pam Dixon, the founder of the World Privacy Forum, coined the term
medical identity theft and released the first major report about this issue in 2006. In the
report, she defined the crime for the first time and made the plight of victims public. The
report's definition of the crime is that medical identity theft occurs when someone seeks
medical care under the identity of another person. Insurance theft is also very common,
if a thief has your insurance information and or your insurance card, they can seek
medical attention posing as yourself. In addition to risks of financial harm common to all
forms of identity theft, the thief's medical history may be added to the victim's medical
records. Inaccurate information in the victim's records is difficult to correct and may
affect future insurability or cause doctors relying on the misinformation to deliver
inappropriate care. After the publication of the report, which contained a
recommendation that consumers receive notifications of medical data breach incidents,
California passed a law requiring this, and then finally HIPAA was expanded to also
require medical breach notification when breaches affect 500 or more people. Data
collected and stored by hospitals and other organizations such as medical aid schemes
is up to 10 times more valuable to cybercriminals than credit card information.
Child Identity Theft
Child identity theft occurs when a minor's identity is used by another person for the
impostor's personal gain. The impostor can be a family member, a friend, or even a
stranger who targets children. The Social Security numbers of children are valued
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ecause they do not have any information associated with them. Thieves can establish
lines of credit, obtain driver's licenses, or even buy a house using a child's identity. This
fraud can go undetected for years, as most children do not discover the problem until
years later. Child identity theft is fairly common, and studies have shown that the
problem is growing. The largest study on child identity theft, as reported by Richard
Power of the Carnegie Mellon Cylab with data supplied by AllClear ID, found that of
40,000 children, 10.2% were victims of identity theft.
The Federal Trade
Commission (FTC)
estimates that about nine
million people will be
victims of identity theft in
the United States per
year. It was also
estimated that in 2008
630,000 people under the
age of 19 were victims of
theft. This then gave
them a debt of about
$12,799 which was not
theirs.
Not only are children in
general big targets of
identity theft but children
who are in foster care are
even bigger targets. This is because they are most likely moved around quite frequently
and their SSN is being shared with multiple people and agencies. Foster children are
even more victims of identity theft within their own family and other relatives. Young
people in foster care who are victims of this crime are usually left alone to struggle and
figure out how to fix their newly formed bad credit.
Financial Identity Theft
The most common type is financial identity theft, where someone wants to gain
economical benefits in someone else's name. This includes getting credits, loans, goods
and services, claiming to be someone else.
Tax Identity Theft
One of the major identity theft categories is Tax Identity Theft. Tax Identity theft occurs
when someone gains another persons information and uses that to receive a tax refund.
The thief in this case can also try to get a job and then their employer will report the
income of the real taxpayer, this then results in the taxpayer getting in trouble with the
IRS.
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The 14039 Form to the IRSis a form that will help one fight against a theft like tax theft.
This form will put the IRS on alert and someone who believed they have been a victim
of tax related theft will be given a Identity Protection Personal Identification Number (IP
PIN), which is a 6 digit code used in replace of a SSN for filing tax returns.
Techniques for Obtaining and Exploiting Personal Information for Identity Theft
Identity thieves typically obtain and exploit personally identifiable information about
individuals, or various credentials they use to authenticate themselves, in order to
impersonate them. Examples include:
Rummaging through rubbish for personal information (dumpster diving)
Retrieving personal data from redundant IT equipment and storage media
including PCs, servers, PDAs, mobile phones, USB memory sticks and hard
drives that have been disposed of carelessly at public dump sites, given away or
sold on without having been properly sanitized
Using public records about individual citizens, published in official registers such
as electoral rolls [23]
Stealing bank or credit cards, identification cards, passports, authentication
tokens ... typically by pickpocketing, housebreaking or mail theft
Common-knowledge questioning schemes that offer account verification and
compromise: "What's your mother's maiden name?", "what was your first car
model?", or "What was your first pet's name?", etc.
Skimming information from bank or credit cards using compromised or hand-held
card readers, and creating clone cards
Using 'contactless' credit card readers to acquire data wirelessly from RFIDenabled
passports
Shoulder-Surfing, involves an individual who discreetly watches or hears others
providing valuable personal information. This is particularly done in crowded
places because it is relatively easy to observe someone as they fill out forms,
enter PIN numbers on ATMs or even type passwords on smartphones.
Stealing personal information from computers using breaches in browser security
or malware such as Trojan horse keystroke logging programs or other forms of
spyware
Hacking computer networks, systems and databases to obtain personal data,
often in large quantities
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Exploiting breaches that result in the publication or more limited disclosure of
personal information such as names, addresses, Social Security number or credit
card numbers
Advertising bogus job offers in order to accumulate resumes and applications
typically disclosing applicants' names, home and email addresses, telephone
numbers and sometimes their banking details
Exploiting insider access and abusing the rights of privileged IT users to access
personal data on their employers' systems
Infiltrating organizations that store
and process large amounts or
particularly valuable personal
information
Impersonating trusted organizations
in emails, SMS text messages,
phone calls or other forms of
communication in order to dupe
victims into disclosing their personal
information or login credentials,
typically on a fake corporate website or data collection form (phishing)
Brute-force attacking weak passwords and using inspired guesswork to
compromise weak password reset questions
Obtaining castings of fingers for falsifying fingerprint identification.
Browsing social networking websites for personal details published by users,
often using this information to appear more credible in subsequent social
engineering activities
Diverting victims' email or post in order to obtain personal information and
credentials such as credit cards, billing and bank/credit card statements, or to
delay the discovery of new accounts and credit agreements opened by the
identity thieves in the victims' names
Using false pretenses to trick individuals, customer service representatives and
help desk workers into disclosing personal information and login details or
changing user passwords/access rights (pretexting)
Stealing cheques (checks) to acquire banking information, including account
numbers and bank codes
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Guessing Social Security numbers by using information found on Internet social
networks such as Facebook and MySpace [25]
Low security/privacy protection on photos that are easily clickable and
downloaded on social networking sites.
Befriending strangers on social networks and taking advantage of their trust until
private information is given.
Indicators That You May Be a Victim of Identity Theft
The majority of identity theft victims do not realize that they are a victim until it has
negatively impacted their lives. Many people do not find out that their identities have
been stolen until they are contacted by financial institutions or discover suspicious
activities on their bank accounts. According to an article by Herb Weisbaum, everyone
in the US should assume that their personal information has been compromised at one
point. It is therefore of great importance to watch out for warning signs that your identity
has been compromised. The following are eleven indicators that someone else might be
using your identity.
1. Credit or debit card charges for goods or services you are not aware of, including
unauthorized withdrawals from your account
2. Receiving calls from credit or debit card fraud control department warning of
possible suspicious activity on your credit card account
3. Receiving credit cards that you did not apply for
4. Receiving information that a credit scoring investigation was done. They are
often done when a loan or phone subscription was applied for.
5. Checks bouncing for lack of enough money in your account to cover the amount.
This might be as a result of unauthorized withdrawals from your account
6. Identity theft criminals may commit crimes with your personal information. You
may not realize this until you see the police on your door arresting you for crimes
that you did not commit
7. Sudden changes to your credit score may indicate that someone else is using
your credit cards
8. Bills for services like gas, water, electricity not arriving in time. This can be an
indication that your mail was stolen or redirected
9. Being not approved for loans because your credit report indicates that you are
not credit worthy
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10. Receiving notification from your post office informing you that your mails are
being forwarded to another unknown address
11. Your yearly tax returns indicating that you have earned more than you have
actually earned. This might indicate that someone is using your national
identification number e.g. SSN to report their earnings to the tax authorities
Individual Identity Protection
The acquisition of personal identifiers is made possible through serious breaches of
privacy. For consumers, this is usually a result of them naively providing their personal
information or login credentials to the identity thieves as a result of being duped but
identity-related documents such as credit cards, bank statements, utility bills,
checkbooks etc. may also be physically stolen from vehicles, homes, offices, and not
the least letterboxes, or directly from victims by pickpockets and bag snatchers.
Guardianship of personal identifiers by consumers is the most common intervention
strategy recommended by the US Federal Trade Commission, Canadian Phone Busters
and most sites that address identity theft. Such organizations offer recommendations on
how individuals can prevent their information falling into the wrong hands.
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Identity theft can be partially mitigated by not identifying oneself unnecessarily (a form
of information security control known as risk avoidance). This implies that organizations,
IT systems and procedures should not demand excessive amounts of personal
information or credentials for identification and authentication. Requiring, storing and
processing personal identifiers (such as Social Security number, national identification
number, driver's license number, credit card number, etc.) increases the risks of identity
theft unless this valuable personal information is adequately secured at all times.
Committing personal identifiers to memory is a sound practice that can reduce the risks
of a would-be identity thief from obtaining these records. To help in remembering
numbers such as social security numbers and credit card numbers, it is helpful to
consider using mnemonic techniques or memory aids such as the mnemonic Major
System.
Identity thieves sometimes impersonate dead people, using personal information
obtained from death notices, gravestones and other sources to exploit delays between
the death and the closure of the person's accounts, the inattentiveness of grieving
families and weaknesses in the processes for credit-checking. Such crimes may
continue for some time until the deceased's families or the authorities notice and react
to anomalies.
In recent years, commercial identity theft protection/insurance services have become
available in many countries. These services purport to help protect the individual from
identity theft or help detect that identity theft has occurred in exchange for a monthly or
annual membership fee or premium. The services typically work either by setting fraud
alerts on the individual's credit files with the three major credit bureaus or by setting up
credit report monitoring with the credit bureaux. While identity theft protection/insurance
services have been heavily marketed, their value has been called into question.
Identity Theft and Potential Outcomes
This picture is relevant to the article in which it provides images to represent the
process of giving personal information to a higher power. It also represents the
techniques used by the people receiving the information.
Identity theft is one of the leading problems in the United States that sometimes results
in unfortunate circumstances. In a 2018 study, it was reported that 60 million Americans
identities were wrongfully acquired. The number of people this has happened to has
revealed there is a wrongful epidemic in our country with how easily our identity is not
truly protected among every account that we have, even our birth certificates. With this
continuing problem, some new bills have been implemented which are thoroughly
described in Identity Theft, to provide more security for people such as electronic
signatures and social security verification for more authentication to further prove it is
the true person. There are several types of identity theft that are used to gather
information, one of the most common types occurs when consumers make online
purchases. A study was conducted with 190 people to determine the relationship
between the constructs of fear of financial losses and reputational damages. The
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conclusions of this study revealed that identity theft was a positive correlation with
reputable damages. The relationship between perceived risk and online purchase
intention were negative. The significance of this study reveals that online companies are
more aware of the potential harm that can be done to their consumers, therefore they
are searching for ways to reduce the perceived risk of consumers and not lose out on
business. Although the idea of identity theft can be frightening to some, the aftermath of
how people move forward is a pretty intense process. Some may face a year or
consecutive years to prove to the legal system that they are the true person. With this
potential long process can lead to emotional strain and financial losses; most theft that
is done was by the victim's family members, some may not be able to obtain new credit
cards or open new bank accounts and sometimes even loans. This is severely
important to provide information about the significance of identity theft and the lasting
impacts it could hold on the victim's life.
Identity Protection by Organizations
In their May 1998 testimony before the United States Senate, the Federal Trade
Commission (FTC) discussed the sale of Social Security numbers and other personal
identifiers by credit-raters and data miners. The FTC agreed to the industry's selfregulating
principles restricting access to information on credit reports. According to the
industry, the restrictions vary according to the category of customer. Credit reporting
agencies gather and disclose personal and credit information to a wide business client
base.
Poor stewardship of personal data by organizations, resulting in unauthorized access to
sensitive data, can expose individuals to the risk of identity theft. The Privacy Rights
Clearinghouse have documented over 900 individual data breaches by US companies
and government agencies since January 2005, which together have involved over 200
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million total records containing sensitive personal information, many containing social
security numbers. Poor corporate diligence standards which can result in data breaches
include:
Failure to shred confidential information before throwing it into dumpsters
Failure to ensure adequate network security
Credit card numbers stolen by call center agents and people with access to call
recordings
The theft of laptop computers or portable media being carried off-site containing
vast amounts of personal information. The use of strong encryption on these
devices can reduce the chance of data being misused should a criminal obtain
them.
The brokerage of personal information to other businesses without ensuring that
the purchaser maintains adequate security controls
Failure of governments, when registering sole proprietorships, partnerships, and
corporations, to determine if the officers listed in the articles of incorporation are
who they say they are. This potentially allows criminals access to personal
information through credit rating and data mining services.
The failure of corporate or government organizations to protect consumer privacy, client
confidentiality and political privacy has been criticized for facilitating the acquisition of
personal identifiers by criminals.
Using various types of biometric information, such as fingerprints, for identification and
authentication has been cited as a way to thwart identity thieves, however there are
technological limitations and privacy concerns associated with these methods as well.
Market
There is an active market for buying and selling stolen personal information, which
occurs mostly in darknet markets but also in other black markets. People increase the
value of the stolen data by aggregating it with publicly available data, and sell it again
for a profit, increasing the damage that can be done to the people whose data was
stolen.
International
Legal Responses
In March 2014, after it was learned two passengers with stolen passports were on board
Malaysia Airlines Flight 370 which went missing on March 8, 2014, it came to light that
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Interpol maintains a database of 40 million lost and stolen travel documents from 157
countries which it makes available to governments and the public, including airlines and
hotels. The Stolen and Lost Travel Documents (SLTD) database however is little used.
Big News Network which is based in the UAE, observed that Interpol Secretary General
Ronald K. Noble told a forum in Abu Dhabi the previous month this was the case. "The
bad news is that, despite being incredibly cost effective and deployable to virtually
anywhere in the world, only a handful of countries are systematically using SLTD to
screen travelers. The result is a major gap in our global security apparatus that is left
vulnerable to exploitation by criminals and terrorists," Noble is quoted as saying.
Australia
In Australia, each state has enacted laws that deal with different aspects of identity or
fraud issues. Some states have now amended relevant criminal laws to reflect crimes of
identity theft, such as the Criminal Law Consolidation Act 1935 (SA), Crimes
Amendment (Fraud, Identity and Forgery Offences) Act 2009 and also in Queensland
under the Criminal Code 1899 (QLD). Other states and territories are in states of
development in respect of regulatory frameworks relating to identity theft such as
Western Australia in respect of Criminal Code Amendment (Identity Crime) Bill 2009.
At the Commonwealth level, under the Criminal Code Amendment (Theft, Fraud,
Bribery & Related Offences) Act 2000 which amended certain provisions within the
Criminal Code Act 1995,
Between 2014 and 2015, in Australia there were 133,921 fraud and deception offences,
an increase of 6% from previous year. The total cost reported by the Attorney General
Department was:
Total Costs
Fraud Category Cost Per Incident Total Direct Cost
Commonwealth fraud $2,111 $353,866,740
Personal fraud $400 $656,550,506
Police recorded fraud $4,412 per unrecorded incident
$27,981 per recorded incident
$3,260,141,049
There are also high indirect costs associated as a direct result of an incident. For
example, the total indirect costs for police recorded fraud is $5,774,081.
135.1 General Dishonesty
(3) A person is guilty of an offence if a) the person does anything with the
intention of dishonestly causing a loss to another person; and b) the other person
is a Commonwealth entity. Penalty: Imprisonment for 5 years.
Likewise, each state has enacted their own privacy laws to prevent misuse of personal
information and data. The Commonwealth Privacy Act is applicable only to
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Commonwealth and territory agencies, and to certain private sector bodies (where for
example they deal with sensitive records, such as medical records, or they have more
than $3 million turnover PA).
Canada
Under section 402.2 of the Criminal Code,
Everyone commits an offence who knowingly obtains or possesses another
person's identity information in circumstances giving rise to a reasonable
inference that the information is intended to be used to commit an indictable
offence that includes fraud, deceit or falsehood as an element of the offence.
is guilty of an indictable offence and liable to imprisonment for a term of
not more than five years; or is guilty of an offence punishable on summary
conviction.
Under section 403 of the Criminal Code,
(1) Everyone commits an offence who fraudulently personates another person, living or
dead,
(a) with intent to gain advantage for themselves or another person; (b) with intent
to obtain any property or an interest in any property; (c) with intent to cause
disadvantage to the person being personated or another person; or (d) with intent
to avoid arrest or prosecution or to obstruct, pervert or defeat the course of
justice. is guilty of an indictable offence and liable to imprisonment for a term of
not more than 10 years; or guilty of an offence punishable on summary
conviction.
In Canada, Privacy Act (federal legislation) covers only federal government, agencies
and crown corporations. Each province and territory has its own privacy law and privacy
commissioners to limit the storage and use of personal data. For the private sector, the
purpose of the Personal Information Protection and Electronic Documents Act ( 2000, c.
5 ) (known as PIPEDA) is to establish rules to govern the collection, use and disclosure
of personal information; except for the provinces of Quebec, Ontario, Alberta and British
Columbia where provincial laws have been deemed substantially similar.
France
In France, a person convicted of identity theft can be sentenced up to five years in
prison and fined up to €75,000.
Hong Kong
Under HK Laws. Chap 210 Theft Ordinance, sec. 16A Fraud
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(1) If any person by any deceit (whether or not the deceit is the sole or main
inducement) and with intent to defraud induces another person to commit an
act or make an omission, which results either-
(a) in benefit to any person other than the second-mentioned person; or
(b) in prejudice or a substantial risk of prejudice to any person other than
the first-mentioned person, the first-mentioned person commits the
offense of fraud and is liable on conviction upon indictment to
imprisonment for 14 years.
Under the Personal Data (Privacy) Ordinance, it established the post of Privacy
Commissioner for Personal Data and mandate how much personal information one can
collect, retain and destruction. This legislation also provides citizens the right to request
information held by businesses and government to the extent provided by this law.
India
Under the Information Technology Act 2000 Chapter IX Sec 66C
SECTION 66C
PUNISHMENT FOR IDENTITY THEFT Whoever, fraudulently or dishonestly makes use
of the electronic signature, password or any other unique identification feature of any
other person, shall be punished with imprisonment of either description for a term which
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may extend to three years and shall also be liable to fine which may extend to rupees
one lakh.
Philippines
Social networking sites are one of the most famous spreaders of posers in the online
community, giving the users freedom to place any information they want without any
verification that the account is being used by the real person.
Philippines, which ranks eighth in the numbers of users of Facebook and other social
networking sites such as Twitter, Multiply and Tumblr, has been known as source of
various identity theft problems. Identities of those people who carelessly put personal
information on their profiles can easily be stolen just by simple browsing. There are
people who meet online, get to know each other through the free Facebook chat and
exchange of messages that then leads to sharing of private information. Others get
romantically involved with their online friends that they tend to give too much information
such as their social security number, bank account and even personal basic information
such as home address and company address.
This phenomenon lead to the creation of Senate Bill 52: Cybercrime Prevention Act of
2010. Section 2 of this bill states that it recognizes the importance of communication
and multimedia for the development, exploitation and dissemination of information but
violators will be punished by the law through imprisonment or a fine upwards of
Php200,000, but not exceeding 1 million, or depending on the damage caused, or both
(Section 7).
Sweden
Sweden has had relatively few problems with identity theft. This is because only
Swedish identity documents have been accepted for identity verification. Stolen
documents are traceable by banks and some other institutions. The banks have the
duty to check the identity of people withdrawing money or getting loans. If a bank gives
money to someone using an identity document reported as stolen, the bank must take
the loss. Since 2008, any EU passport is valid in Sweden for identity check, and
Swedish passports are valid all over the EU. This makes it harder to detect stolen
documents, but still banks in Sweden must ensure that stolen documents are not
accepted.
Other types of identity theft have become more common in Sweden. One common
example is ordering a credit card to someone who has an unlocked letterbox and is not
home in the daytime. The thief steals the letter with the credit card and then the letter
with the code which typically arrives a few days later. Usage of a stolen credit card is
hard in Sweden, since an identity document or a PIN code it is normally demanded. If
the shop does not demand that, it must take the loss from stolen credit cards. The
method of observing someone using the credit card PIN code, stealing the card or
skimming it, and then using the card, has become more common.
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Legally, Sweden is an open society. The Principle of Public Access says that all
information kept by public authorities must be available for anyone except in certain
cases. Specifically, anyone's address, income, taxes etc. are available to anyone. This
makes fraud easier (the address is restricted only for people who needs to hide).
There was until 2016 no legal
ban specifically against using
someone's identity, only on
the indirect damage caused.
To impersonate someone
else for financial gain is a
kind of fraud, which is
described in the Criminal
Code
(Swedish:
brottsbalken).
To
impersonate someone else to
discredit someone by breaking into social media accounts and provoke, is libel, but that
is hard to sentence someone for. A new law was introduced late 2016 which partially
banned unpermitted identity usage.
United Kingdom
In the United Kingdom personal data is protected by the Data Protection Act 1998. The
Act covers all personal data which an organization may hold, including names, birthday
and anniversary dates, addresses, telephone numbers, etc.
Under English law (which extends to Wales but not to Northern Ireland or Scotland), the
deception offences under the Theft Act 1968 increasingly contend with identity theft
situations. In R v Seward (2005) EWCA Crim 1941 the defendant was acting as the
"front man" in the use of stolen credit cards and other documents to obtain goods. He
obtained goods to the value of £10,000 for others who are unlikely ever to be identified.
The Court of Appeal considered a sentencing policy for deception offenses involving
"identity theft" and concluded that a prison sentence was required. Henriques J. said at
para 14:"Identity fraud is a particularly pernicious and prevalent form of dishonesty
calling for, in our judgment, deterrent sentences."
Statistics released by CIFAS - The UK's Fraud Prevention Service show that there were
89,000 victims of identity theft in the UK 2010. This compared with 2009 where there
were 85,000 victims. Men in their 30s and 40s are the most common UK victims and
identity fraud now accounts for nearly half of all frauds recorded.
United States
The increase in crimes of identity theft led to the drafting of the Identity Theft and
Assumption Deterrence Act. In 1998, The Federal Trade Commission appeared before
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the United States Senate. The FTC discussed crimes which exploit consumer credit to
commit loan fraud, mortgage fraud, lines-of-credit fraud, credit card fraud, commodities
and services frauds. The Identity Theft Deterrence Act (2003)[ITADA] amended U.S.
Code Title 18, § 1028 ("Fraud related to activity in connection with identification
documents, authentication features, and information"). The statute now makes the
possession of any "means of identification" to "knowingly transfer, possess, or use
without lawful authority" a federal crime, alongside unlawful possession of identification
documents. However, for federal jurisdiction to prosecute, the crime must include an
"identification document" that either: (a) is purportedly issued by the United States, (b) is
used or intended to defraud the United States, (c) is sent through the mail, or (d) is used
in a manner that affects interstate or foreign commerce. See 18 U.S.C. § 1028(c).
Punishment can be up to 5, 15, 20, or 30 years in federal prison, plus fines, depending
on the underlying crime per 18 U.S.C. § 1028(b). In addition, punishments for the
unlawful use of a "means of identification" were strengthened in § 1028A ("Aggravated
Identity Theft"), allowing for a consecutive sentence under specific enumerated felony
violations as defined in § 1028A(c)(1) through (11).
The Act also provides the Federal Trade Commission with authority to track the number
of incidents and the dollar value of losses. Their figures relate mainly to consumer
financial crimes and not the broader range of all identification-based crimes.
If charges are brought by state or local law enforcement agencies, different penalties
apply depending on the state.
Six Federal agencies conducted a joint task force to increase the ability to detect
identity theft. Their joint recommendation on "red flag" guidelines is a set of
requirements on financial institutions and other entities which furnish credit data to
credit reporting services to develop written plans for detecting identity theft. The FTC
has determined that most medical practices are considered creditors and are subject to
requirements to develop a plan to prevent and respond to patient identity theft. These
plans must be adopted by each organization's Board of Directors and monitored by
senior executives.
Identity theft complaints as a percentage of all fraud complaints decreased from 2004-
2006. The Federal Trade Commission reported that fraud complaints in general were
growing faster than ID theft complaints. The findings were similar in two other FTC
studies done in 2003 and 2005. In 2003, 4.6 percent of the US population said they
were a victim of ID theft. In 2005, that number had dropped to 3.7 percent of the
population. The Commission's 2003 estimate was that identity theft accounted for some
$52.6 billion of losses in the preceding year alone and affected more than 9.91 million
Americans; the figure comprises $47.6 billion lost by businesses and $5 billion lost by
consumers.
According to the U.S. Bureau of Justice Statistics, in 2010, 7% of US households
experienced identity theft - up from 5.5% in 2005 when the figures were first assembled,
but broadly flat since 2007. In 2012, approximately 16.6 million persons, or 7% of all
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U.S. residents age 16 or older, reported being victims of one or more incidents of
identity theft.
At least two states, California and Wisconsin have created an Office of Privacy
Protection to assist their citizens in avoiding and recovering from identity theft.
In 2009, Indiana created an Identity Theft Unit within their Office of Attorney General to
educate and assist consumers in avoiding and recovering from identity theft as well as
assist law enforcement in investigating and prosecuting identity theft crimes.
In Massachusetts in 2009-2010, Governor Deval Patrick made a commitment to
balance consumer protection with the needs of small business owners. His Office of
Consumer Affairs and Business Regulation announced certain adjustments to
Massachusetts' identity theft regulations that maintain protections and also allows
flexibility in compliance. These updated regulations went into effect on March 1, 2010.
The regulations are clear that their approach to data security is a risk-based approach
important to small businesses and might not handle a lot of personal information about
customers.
The IRS has created the IRS Identity Protection Specialized Unit to help taxpayers' who
are victims of federal tax-related identity theft. Generally, the identity thief will use a
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stolen SSN to file a forged tax return and attempt to get a fraudulent refund early in the
filing season. A taxpayer will need to fill out Form 14039, Identity Theft Affidavit.
As for the future of medical care and Medicaid, people are mostly concerned about
cloud computing. The addition of using cloud information within United States medicare
system would institute easily accessible health information for individuals, but that also
makes it easier for identity theft. Currently, new technology is being produced to help
encrypt and protect files, which will create a smooth transition to cloud technology in the
healthcare system.
Notification
Many states followed California's lead and enacted mandatory data breach notification
laws. As a result, companies that report a data breach typically report it to all their
customers.
Spread and Impact
Surveys in the USA from 2003 to 2006 showed a decrease in the total number of
victims and a decrease in the total value of identity fraud from US$47.6 billion in 2003 to
$15.6 billion in 2006. The average fraud per person decreased from $4,789 in 2003 to
$1,882 in 2006. A Microsoft report shows that this drop is due to statistical problems
with the methodology, that such survey-based estimates are "hopelessly flawed" and
exaggerate the true losses by orders of magnitude.
The 2003 survey from the Identity Theft Resource Center found that:
Only 15% of victims find out about the theft through proactive action taken by a
business
The average time spent by victims resolving the problem is about 330 hours
73% of respondents indicated the crime involved the thief acquiring a credit card
In a widely publicized account, Michelle Brown, a victim of identity fraud, testified before
a U.S. Senate Committee Hearing on Identity Theft. Ms. Brown testified that: "over a
year and a half from January 1998 through July 1999, one individual impersonated me
to procure over $50,000 in goods and services. Not only did she damage my credit, but
she escalated her crimes to a level that I never truly expected: she engaged in drug
trafficking. The crime resulted in my erroneous arrest record, a warrant out for my
arrest, and eventually, a prison record when she was booked under my name as an
inmate in the Chicago Federal Prison."
In Australia, identity theft was estimated to be worth between A$1billion and A$4 billion
per annum in 2001.
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In the United Kingdom, the Home Office reported that identity fraud costs the UK
economy £1.2 billion annually (experts believe that the real figure could be much higher)
although privacy groups object to the validity of these numbers, arguing that they are
being used by the government to push for introduction of national ID cards. Confusion
over exactly what constitutes identity theft has led to claims that statistics may be
exaggerated. An extensively reported study from Microsoft Research in 2011 finds that
estimates of identity theft losses contain enormous exaggerations, writing that surveys
"are so compromised and biased that no faith whatever can be placed in their findings."
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XI. Kidnapping
In criminal law, kidnapping is the unlawful carrying away (asportation) and confinement
of a person against his or her will. Thus, it is a composite crime. It can also be defined
as false imprisonment by means of abduction, both of which are separate crimes that
when committed simultaneously upon the same person merge as the single crime of
kidnapping. The asportation/abduction element is typically but not necessarily
conducted by means of force or fear. That is, the perpetrator may use a weapon to force
the victim into a vehicle, but it is still kidnapping if the victim is enticed to enter the
vehicle willingly, e.g., in the belief it is a taxicab.
Kidnapping may be done to demand for ransom in exchange for releasing the victim, or
for other illegal purposes. Kidnapping can be accompanied by bodily injury which
elevates the crime to aggravated kidnapping.
Kidnapping of a child is also known as child abduction, and these are sometimes
separate legal categories.
Motivations
Kidnapping of children is usually by one parent against the wishes of a parent or
guardian. Kidnapping of adults is often for ransom or to force someone to withdraw
money from an ATM, but may also be for the purpose of sexual assault.
In the past, and presently in some parts of the world (such as southern Sudan),
kidnapping is a common means used to obtain slaves and money through ransom. In
less recent times, kidnapping in the form of shanghaiing (or "pressganging") men was
used to supply merchant ships in the 19th century with sailors, whom the law
considered unfree labor.
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Criminal gangs are estimated to make up to $500 million a year in ransom payments
from kidnapping.
Kidnapping has been identified as one source by which terrorist organizations have
been known to obtain funding. The Perri, Lichtenwald and MacKenzie article identified
"tiger" kidnapping as a specific method used by either the Real Irish Republican Army or
Continuity Irish Republican Army, in which a kidnapped family member is used to force
someone to steal from their employer.
Bride kidnapping is a term often applied loosely, to include any bride "abducted"
against the will of her parents, even if she is willing to marry the "abductor". It still
is traditional amongst certain nomadic peoples of Central Asia. It has seen a
resurgence in Kyrgyzstan since the fall of the Soviet Union and the subsequent
erosion of women's rights.
Express kidnapping is a method of abduction used in some countries, mainly
from Latin America, where a small ransom, that a company or family can easily
pay, is demanded.
Tiger kidnapping is taking a hostage to make a loved one or associate of the
victim do something: e.g. a child is taken hostage to force the shopkeeper to
open the safe. The term originates from the usually long preceding observation,
like a tiger does on the prowl.
By Jurisdiction
Canada
Kidnapping that does not result in a homicide is a hybrid offence that comes with a
maximum possible penalty of life imprisonment (18 months if tried summarily). A murder
that results from kidnapping is classified as 1st-degree, with a sentence of life
imprisonment that results from conviction (the mandatory penalty for murder under
Canadian law).
Netherlands
Article 282 prohibits hostaging (and 'kidnapping' is a kind of 'hostaging'). Part 1 of Article
282 allows sentencing kidnappers to maximum imprisonment of 8 years or a fine of the
fifth category. Part 2 allows maximum imprisonment of 9 years or a fine of the fifth
category if there are serious injuries.
Part 3 allows maximum imprisonment of 12 years or a fine of the fifth category if the
victim has been killed. Part 4 allows sentencing people that collaborate with kidnapping
(such as proposing or make available a location where the victim hostaged). Part 1, 2
and 3 will apply also to them.
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United Kingdom
Kidnapping is an offence under the common law of England and Wales. Lord Brandon
said in 1984 R v D:
First, the nature of the offence is an attack on, and infringement of, the personal liberty
of an individual. Secondly, the offence contains four ingredients as follows: (1) the
taking or carrying away of one person by another; (2) by force or fraud; (3) without the
consent of the person so taken or carried away; and (4) without lawful excuse.
In all cases of kidnapping of children, where it is alleged that a child has been
kidnapped, it is the absence of the consent of that child which is material. This is the
case regardless of the age of the child. A very small child will not have the
understanding or intelligence to consent. This means that absence of consent will be a
necessary inference from the age of the child. It is a question of fact for the jury whether
an older child has sufficient understanding and intelligence to consent. Lord Brandon
said: "I should not expect a jury to find at all frequently that a child under fourteen had
sufficient understanding and intelligence to give its consent." If the child (being capable
of doing so) did consent to being taken or carried away, the fact that the person having
custody or care and control of that child did not consent to that child being taken or
carried away is immaterial. If, on the other hand, the child did not consent, the consent
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of the person having custody or care and control of the child may support a defense of
lawful excuse. It is known as Gillick competence.
Regarding Restriction on prosecution, no prosecution may be instituted, except by or
with the consent of the Director of Public Prosecutions, for an offence of kidnapping if it
was committed against a child under the age of sixteen and by a person connected with
the child, within the meaning of section 1 of the Child Abduction Act 1984. Kidnapping is
an indictable-only offence. Kidnapping is punishable with imprisonment or fine at the
discretion of the court. There is no limit on the fine or the term of imprisonment that may
be imposed provided the sentence is not inordinate.
A parent should only be prosecuted for kidnapping their own child "in exceptional cases,
where the conduct of the parent concerned is so bad that an ordinary right-thinking
person would immediately and without hesitation regard it as criminal in nature".
United States
Law in the United States follows from English common law. Following the highly
publicized 1932 Lindbergh kidnapping, Congress passed the Federal Kidnapping Act,
which authorized the FBI to investigate kidnapping at a time when the Bureau was
expanding in size and authority. The fact that a kidnapped victim may have been taken
across state lines brings the crime within the ambit of federal criminal law.
Most states recognize different types of kidnapping and punish accordingly. E.g. New
York bases its definition of first-degree kidnapping on the duration and purpose. There
are several deterrents to kidnapping in the United States of America. Among these are:
1. The extreme logistical challenges involved in successfully exchanging the money
for the return of the victim without being apprehended or surveiled.
2. Harsh punishment. Convicted kidnappers face lengthy prison terms. If a victim is
brought across state lines, federal charges can be laid as well.
3. Good cooperation and information sharing between law enforcement agencies,
and tools for spreading information to the public (such as the AMBER Alert
system).
One notorious failed example of kidnap for ransom was the 1976 Chowchilla bus
kidnapping, in which 26 children were abducted with the intention of bringing in a $5-
million ransom. The children and driver escaped from an underground van without the
aid of law enforcement. According to the Department of Justice, kidnapping makes up
2% of all reported violent crimes against juveniles.
From the 1990s on, a gang operating in New York City and New Jersey was involved in
the kidnapping and torture of Jewish husbands for the purpose of forcing them to grant
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eligious divorces to their wives. They were finally apprehended on October 9, 2013, in
connection with the 2013 New York divorce torture plot.
According to a 2003 Domestic Violence Report in Colorado, out of a survey of 189
incidents, most people (usually white females) are taken from their homes or residence
by a present or former spouse or significant other. They are usually taken by force, not
by weapon, and usually the victims are not injured when they are freed.
In 2009, Phoenix, Arizona reported over 300 cases of kidnapping, although subsequent
investigation found that the Phoenix police falsified data "Phoenix Kidnappings:
Uncovering the Truth". Archived from the original on 2013-04-13.. If true, this would
have been the highest rate of any US city and second in the world only to Mexico City.
A rise in kidnappings in the southwestern United States in general has been attributed
to misclassification by local police, lack of a unified standard, desire for Federal grants,
or the Mexican Drug War.
In 2010 the United States was ranked sixth in the world (by absolute numbers, not per
capita) for kidnapping for ransom, according to the available statistics (after Colombia,
Italy, Lebanon, Peru, and the Philippines).
In 2009, the Los Angeles Times named Phoenix, Arizona, as America's kidnapping
capital, reporting that every year hundreds of ransom kidnappings occur there, virtually
all within the underworld associated with human and drug smuggling from Mexico, and
often done as a way of collecting unpaid debts. However, a later audit by the U.S.
Department of Justice Inspector General found only 59 federally reportable kidnappings
in 2008, compared to the over 300 claimed on grant applications.
During the year 1999 in the United States, 203,900 children were reported as the
victims of family abductions and 58,200 of non-family abductions. However, only 115
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were the result of "stereotypical" kidnaps (by someone unknown or of slight
acquaintance to the child, held permanently or for ransom).
Statistics
Global Kidnapping Hotspots
1999 2006 2014
1 Colombia Mexico Mexico
2 Mexico Iraq India
3 Brazil India Pakistan
4 Philippines South Africa Iraq
5 Venezuela Brazil Nigeria
6 Ecuador Pakistan Libya
7 Russia and CIS Ecuador Afghanistan
8 Nigeria Venezuela Bangladesh
9 India Colombia Sudan
10 South Africa Bangladesh Lebanon
Countries with The Highest Rates
Kidnapping for ransom is a common occurrence in various parts of the world today, and
certain cities and countries are often described as the "Kidnapping Capital of the
World". As of 2007, that title belongs to Iraq with possibly 1,500 foreigners kidnapped. In
2004, it was Mexico, and in 2001, it was Colombia. Statistics are harder to come by.
Reports suggest a world total of 12,500-25,500/year with 3,600/year in Colombia and
3,000/year in Mexico around the year 2000. However, by 2016, the number of
kidnappings in Colombia had declined to 205 and it continues to decline. Mexican
numbers are hard to confirm because of fears of police involvement in kidnapping.
"Kidnapping seems to flourish particularly in fragile states and conflict countries, as
politically motivated militias, organized crime and the drugs mafia fill the vacuum left by
government".
Pirates
Kidnapping on the high seas in connection with piracy has been increasing. It was
reported that 661 crewmembers were taken hostage and 12 kidnapped in the first 9
months of 2009.
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XII. Loan Sharking
A loan shark is a person who offers loans at extremely high interest rates, has strict
terms of collection upon failure, and operates outside off the street (outside of local
authority). The term usually refers to illegal activity, but may also refer to predatory
lending with extremely high interest rates such as payday or title loans.
An unintended consequence of poverty alleviation initiatives can be that loan sharks
borrow from formal microfinance lenders and lend on to poor borrowers. Loan sharks
sometimes enforce repayment by blackmail or threats of violence. Historically, many
moneylenders skirted between legal and criminal activity. In the recent western world,
loan sharks have been a feature of the criminal underworld.
19th-Century Salary Lenders
United States
In the late 19th-century US, the low legal interest rates made small loans unprofitable,
and small-time lending was viewed as irresponsible by society. Banks and other major
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financial institutions thus stayed away from small-time lending. There were, however,
plenty of small lenders offering loans at profitable but illegally high interest rates. They
presented themselves as legitimate and operated openly out of offices. They only
sought customers who had a steady and respectable job, a regular income and a
reputation to protect. This made them less likely to leave the area before they paid their
debt and more likely to have a legitimate reason for borrowing money. Gamblers,
criminals, and other disreputable, unreliable types were avoided. They made the
borrower fill out and sign seemingly legitimate contracts. Though these contracts were
not legally enforceable, they at least were proof of the loan, which the lender could use
to blackmail a defaulter.
To force a defaulter into paying, the lender might threaten legal action. This was a bluff,
since the loan was illegal. The lender preyed on the borrower's ignorance of the law.
Alternatively, the lender resorted to public shaming, exploiting the social stigma of being
in debt to a loan shark. They were able to complain to the defaulter's employer, because
many employers would fire employees who were mired in debt, because of the risk of
them stealing from the employer to repay debts. They were able to send agents to stand
outside the defaulter's home, loudly denouncing him, perhaps vandalizing his home with
graffiti or notices. Whether out of gullibility or embarrassment, the borrower usually
succumbed and paid.
Many customers were employees of large firms, such as railways or public works.
Larger organizations were more likely to fire employees for being in debt, as their rules
were more impersonal, which made blackmail easier. It was easier for lenders to learn
which large organizations did this as opposed to collecting information on the multitude
of smaller firms. Larger firms had more job security and the greater possibility of
promotion, so employees sacrificed more to ensure they were not fired. The loan shark
could also bribe a large firm's paymaster to provide information on its many employees.
Regular salaries and paydays made negotiating repayment plans simpler.
The size of the loan and the repayment plan were often tailored to suit the borrower's
means. The smaller the loan, the higher the interest rate was, as the costs of tracking
and pursuing a defaulter (the overhead) were the same whatever the size of the loan.
The attitudes of lenders to defaulters also varied: some were lenient and reasonable,
readily granting extensions and slow to harass, while others unscrupulously tried to milk
all they could from the borrower (e.g. imposing late fees).
Because salary lending was a disreputable trade, the owners of these firms often hid
from public view, hiring managers to run their offices indirectly. To further avoid
attracting attention, when expanding his trade to other cities, an owner would often
found new firms with different names rather than expanding his existing firm into a very
noticeable leviathan.
The penalties for being an illegal lender were mild. Illegal lending was a misdemeanor,
and the penalty was forfeiture of the interest and perhaps the principal as well. But
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these were only ever imposed if the borrower sued, which he typically could not afford
to do.
Opposition to salary lenders was spearheaded by social elites, such as businessmen
and charity organizations. Businessmen were encouraged not to fire employees who
were indebted to loan sharks, as they unwittingly supported the industry by providing
lenders with a means of blackmailing their customers ("pay up or we'll tell your boss and
you'll be fired"). Charities provided legal support to troubled borrowers. This fight
culminated in the drafting of the Uniform Small Loan Law, which brought into existence
a new class of licensed lender. The law was enacted, first in several states in 1917, and
was adopted by all but a handful of states by the middle of the 20th century. The model
statute mandated consumer protections and capped the interest rate on loans of $300
or less at 3.5% a month (42% a year), a profitable level for small loans. Lenders had to
give the customer copies of all signed documents.
Additional charges such as late fees were banned. The lender could no longer receive
power of attorney or confession of judgment over a customer. These licensing laws
made it impossible for usurious lenders to pass themselves off as legal. Small loans
also started becoming more socially acceptable, and banks and other larger institutions
started offering them as well.
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20th-Century Gangsters
In the 1920s and 1930s, American prosecutors began to notice the emergence of a new
breed of illegal lender that used violence to enforce debts. The new small lender laws
had made it almost impossible to intimidate customers with a veneer of legality, and
many customers were less vulnerable to shaming because they were either selfemployed
or already disreputable. Thus, violence was an important tool, though not
their only one. These loan sharks operated more informally than salary lenders, which
meant more discretion for the lender and less paperwork and bureaucracy for the
customer. They were also willing to serve high-risk borrowers that legal lenders wouldn't
touch.
Threats of violence were rarely followed through, however. One possible reason is that
injuring a borrower could have meant he couldn't work and thus could never pay off his
debt. Many regular borrowers realized the threats were mostly bluffs and that they could
get away with delinquent payments. A more certain consequence was that the
delinquent borrower would be cut off from future loans, which was serious for those who
regularly relied on loan sharks.
One important market for violent loan sharks was illegal gambling operators, who
couldn't expose themselves to the law to collect debts legally. They cooperated with
loan sharks to supply credit and collect payments from their punters. Thieves and other
criminals, whose fortunes were frequently in flux, were also served, and these
connections also allowed the loan sharks to operate as fences. Another type of high-risk
customer was the small businessman in dire financial straits who couldn't qualify for a
legal loan.
Violent loansharking was typically run by criminal syndicates, such as the Mafia. Many
of these were former bootleggers who needed a new line of work after the end of
Prohibition. Towards the 1960s, loan sharks grew ever more coordinated, and could
pool information on borrowers to better size up risks and ensure a borrower did not try
to pay off one loan by borrowing from another loan shark. The fearsome reputation of
the Mafia or similar large gang made the loan shark's threat of violence more credible.
Mafia Links
Origins In "Salary Buying", 1920-Criminalization
Although the reform law was intended to starve the loan sharks into extinction, this
species of predatory lender thrived and evolved. After high-rate salary lending was
outlawed, some bootleg vendors recast the product as "salary buying". They claimed
they were not making loans but were purchasing future wages at a discount. This form
of loansharking proliferated through the 1920s and into the 1930s until a new draft of
the Uniform Small Loan Law closed the loophole through which the salary buyers had
slipped. Salary-buying loan sharks continued to operate in some southern states after
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World War II because the usury rate was set so low that licensed personal finance
companies could not do business there.
Post-Criminalization
Organized crime began to enter the cash advance business in the 1930s, after high-rate
lending was criminalized by the Uniform Small Loan Law. The first reports of mob
loansharking surfaced in New York City in 1935, and for 15 years, underworld money
lending was apparently restricted to that city. There is no record of syndicate "juice"
operations in Chicago, for instance, until the 1950s.
In the beginning, underworld
loansharking was a small
loan business, catering to the
same populations served by
the salary lenders and
buyers.
Those who turned to the
bootleg lenders could not get
credit at the licensed
companies because their
incomes were too low or they
were deemed poor risks. The
firms operating within the
usury cap turned away
roughly half of all applicants
and tended to make larger
loans to married men with
steady jobs and decent
incomes.
Those who could not get a
legal loan at 36% or 42% a year could secure a cash advance from a mobster at the
going rate of 10% or 20% a week for small loans. Since the mob loans were not usually
secured with legal instruments, debtors pledged their bodies as collateral.
In its early phase, a large fraction of mob loansharking consisted of payday lending.
Many of the customers were office clerks and factory hands. The loan fund for these
operations came from the proceeds of the numbers racket and was distributed by the
top bosses to the lower echelon loan sharks at the rate of 1% or 2% a week.
The 1952 B-flick Loan Shark, starring George Raft, offers a glimpse of mob payday
lending. The waterfront in Brooklyn was another site of extensive underworld payday
advance operations around mid-century.
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1960s Heyday–Present
Over time, mob loan sharks moved away from such labor intensive rackets. By the
1960s, the preferred clientele was small and medium-sized businesses. Business
customers had the advantage of possessing assets that could be seized in case of
default, or used to engage in fraud or to launder money. Gamblers were another
lucrative market, as were other criminals who needed financing for their operations. By
the 1970s, mob salary lending operations seemed to have withered away in the United
States.
At its height in the 1960s, underworld loansharking was estimated to be the second
most lucrative franchise of organized crime in the United States after illegal gambling.
Newspapers in the 1960s were filled with sensational stories of debtors beaten,
harassed, and sometimes murdered by mob loan sharks.
Yet careful studies of the business have raised doubts about the frequency with which
violence was employed in practice. Relations between creditor and debtor could be
amicable, even when the "vig" or "juice" was exorbitant, because each needed the
other. FBI agents in one city interviewed 115 customers of a mob loan business but
turned up only one debtor who had been threatened. None had been beaten.
Non-Mafia Sharks
Organized crime has never had a monopoly on black market lending. Plenty of vestpocket
lenders operated outside the jurisdiction of organized crime, charging usurious
rates of interest for cash advances. These informal networks of credit rarely came to the
attention of the authorities but flourished in populations not served by licensed lenders.
Even today, after the rise of corporate payday lending in the United States, unlicensed
loan sharks continue to operate in immigrant enclaves and low-income neighborhoods.
They lend money to people who work in the informal sector or who are deemed to be
too risky even by the check-cashing creditors. Some beat delinquents while others seize
assets instead. Their rates run from 10% to 20% a week, just like the mob loan sharks
of days gone by.
UK Loan Sharks
The research by the government and other agencies estimates that 165,000 to 200,000
people are indebted to loan sharks in the United Kingdom. Illicit loan sharking is treated
as a high-level crime (felony) by law enforcement, due to its links to organized crime
and the serious violence involved. Payday loans with high interest rates are legal in
many cases, and have been described as "legal loan sharking" (in that the creditor is
legally registered, pays taxes and contributions, and can reclaim remittance if taking the
case to adjudication; likewise there is no threat of harm to the debtor).
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Loan Sharks In Ireland
The Central Bank of Ireland were criticized for doing nothing to protect those on low
incomes, the vulnerable or have low levels of financial literacy from loan sharks when it
emerged that up to 100,000 of the 360,000 loans given by moneylenders broke the law.
Non-Standard Lenders In The
United States
In the United States, there are lenders
licensed to serve borrowers who
cannot qualify for standard loans from
mainstream sources. These smaller,
non-standard lenders often operate in
cash, whereas mainstream lenders
increasingly operate only
electronically and will not serve
borrowers who do not have bank
accounts. Terms such as sub-prime
lending, "non-standard consumer
credit", and payday loans are often
used in connection with this type of consumer finance. The availability of these services
has made illegal, exploitative loan sharks rarer, but these legal lenders have also been
accused of behaving in an exploitative manner. For example, payday loan operations
have come under fire for charging inflated "service charges" for their services of cashing
a "payday advance", effectively a short-term (no more than one or two weeks) loan for
which charges may run 3–5% of the principal amount. By claiming to be charging for the
"service" of cashing a paycheck, instead of merely charging interest for a short-term
loan, laws that strictly regulate moneylending costs can be effectively bypassed.
Payday Lending
Licensed payday advance businesses, which lend money at high rates of interest on the
security of a postdated check, are often described as loan sharks by their critics due to
high interest rates that trap debtors, stopping short of illegal lending and violent
collection practices. Today's payday loan is a close cousin of the early 20th century
salary loan, the product to which the "shark" epithet was originally applied, but they are
now legalized in some states.
A 2001 comparison of short-term lending rates charged by the Chicago Outfit organized
crime syndicate and payday lenders in California revealed that, depending on when a
payday loan was paid back by a borrower (generally 1–14 days), the interest rate
charged for a payday loan could be considerably higher than the interest rate of a
similar loan made by the organized crime syndicate.
Yamikinyu in Japan
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The regulation of moneylenders is typically much looser than that of banks. In Japan,
the Moneylending Control Law requires only registration in each prefecture. In Japan,
as the decades-long depression lingers, banks are reluctant to spare money and
regulation becomes tighter, illegal moneylending has become a social issue. Illegal
moneylenders typically charge an interest of 30 or 50% in 10 days (in Japanese, these
are called "to-san" ('to' meaning ten and 'san' meaning three, or 10-3) or "to-go" ('to'
meaning ten and 'go' meaning five, or 10-5), which is about 1.442 million % or
267.5 million % per annum. This is against the law that sets the maximum interest rate
at 20%. They usually do business with those who cannot get more money from banks,
legitimate consumer loans, or credit cards.
Ah Long in Malaysia and Singapore
Ah Long (derived from the Cantonese phrase ' 大 耳 窿 ' ("big ear hole")) is a colloquial
term for illegal loan sharks in Malaysia and Singapore. They lend money to people who
are unable to obtain loans from banks or other legal sources, mostly targeting habitual
gamblers. Often, they discreetly advertise by sticking notices, mostly on lamp posts and
utility boxes around a neighborhood, thus vandalizing public property, as authorities
must remove such advertisements. They charge high interest rates (generally about
40% per month/fortnight) according to Anti-Crime, Drug and Social Development
Voluntary Organization and frequently threaten violence (and administer it) towards
those who fail to pay on time.
Ah Long Tactics
When a person fails to pay on time, the Ah Long will set fire, spray paint, splash, or
write threats in paint or markers on the walls of the property of that person as a threat of
violence and to scare, and perhaps shame, the borrower into repaying the loan. A
common use of painting includes the characters "O$P$" meaning "owe money, pay
money", as well as the debtors' unit number. According to local police authorities, there
have been cases where borrowers and their family members were beaten or had their
property damaged or destroyed, and some victims have committed suicide.
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XIII. Money Laundering
Money Laundering is the process of concealing the origins of money obtained illegally
by passing it through a complex sequence of banking transfers or commercial
transactions.
One problem of criminal activities is accounting for the proceeds without raising the
suspicion of law enforcement agencies. Considerable time and effort may be put into
strategies which enable the safe use of those proceeds without raising unwanted
suspicion. Implementing such strategies is generally called money laundering. After
money has been laundered it can be used for legitimate purposes. Law enforcement
agencies of many jurisdictions have set up sophisticated systems in an effort to detect
suspicious transactions or activities, and many have set up international cooperative
arrangements to assist each other in these endeavors.
In a number of legal and regulatory systems, the term "money laundering" has become
conflated with other forms of financial and business crime, and is sometimes used more
generally to include misuse of the financial system (involving things such as securities,
digital currencies, credit cards, and traditional currency), including terrorism financing
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and evasion of international sanctions. Most anti-money laundering laws openly conflate
money laundering (which is concerned with source of funds) with terrorism financing
(which is concerned with destination of funds) when regulating the financial system.
Some countries treat obfuscation of sources of money as also constituting money
laundering, whether it is intentional or by merely using financial systems or services that
do not identify or track sources or destinations. Other countries define money
laundering in such a way as to include money from activity that would have been a
crime in that country, even if the activity was legal where the actual conduct occurred.
History
Laws against money laundering were created to use against organized crime during the
period of Prohibition in the United States during the 1930s. Organized crime received a
major boost from Prohibition and a large source of new funds that were obtained from
illegal sales of alcohol. The successful prosecution of Al Capone on tax evasion brought
in a new emphasis by the state and law enforcement agencies to track and confiscate
money, but existing laws against tax evasion could not be used once gangsters started
paying their taxes.
In the 1980s, the war on drugs led governments again to turn to money-laundering rules
in an attempt to seize proceeds of drug crimes in order to catch the organizers and
individuals running drug empires. It also had the benefit from a law enforcement point of
view of turning rules of evidence upside down. Law enforcers normally have to prove an
individual is guilty to get a conviction. But with money laundering laws, money can be
confiscated and it is up to the individual to prove that the source of funds is legitimate if
they want the funds back. This makes it much easier for law enforcement agencies and
provides for much lower burdens of proof.
The September 11 attacks in 2001, which led to the Patriot Act in the U.S. and similar
legislation worldwide, led to a new emphasis on money laundering laws to combat
terrorism financing. [5] The Group of Seven (G7) nations used the Financial Action Task
Force on Money Laundering to put pressure on governments around the world to
increase surveillance and monitoring of financial transactions and share this information
between countries. Starting in 2002, governments around the world upgraded money
laundering laws and surveillance and monitoring systems of financial transactions. Antimoney
laundering regulations have become a much larger burden for financial
institutions and enforcement has stepped up significantly. During 2011–2015 a number
of major banks faced ever-increasing fines for breaches of money laundering
regulations. This included HSBC, which was fined $1.9 billion in December 2012, and
BNP Paribas, which was fined $8.9 billion in July 2014 by the U.S. government. Many
countries introduced or strengthened border controls on the amount of cash that can be
carried and introduced central transaction reporting systems where all financial
institutions have to report all financial transactions electronically. For example, in 2006,
Australia set up the AUSTRAC system and required the reporting of all financial
transactions.
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Definition
Placing "dirty" money in a service company, where it is layered
with legitimate income and then integrated into the flow of money,
is a common form of money laundering.
The conversion or transfer of property, the concealment
or disguising of the nature of the proceeds, the
acquisition, possession or use of property, knowing that
these are derived from criminal activity and participate
or assist the movement of funds to make the proceeds
appear legitimate is money laundering.
Money obtained from certain crimes, such as extortion, insider trading, drug trafficking,
and illegal gambling is "dirty" and needs to be "cleaned" to appear to have been derived
from legal activities, so that banks and other financial institutions will deal with it without
suspicion. Money can be laundered by many methods which vary in complexity and
sophistication.
Money laundering involves three steps: The first involves introducing cash into the
financial system by some means ("placement"); the second involves carrying out
complex financial transactions to camouflage the illegal source of the cash ("layering");
and finally, acquiring wealth generated from the transactions of the illicit funds
("integration"). Some of these steps may be omitted, depending upon the
circumstances. For example, non-cash proceeds that are already in the financial system
would not need to be placed.
According to the United States Treasury Department:
Money laundering is the process of making illegally-gained proceeds (i.e., "dirty
money") appear legal (i.e., "clean"). Typically, it involves three steps: placement,
layering, and integration. First, the illegitimate funds are furtively introduced into the
legitimate financial system. Then, the money is moved around to create confusion,
sometimes by wiring or transferring through numerous accounts. Finally, it is integrated
into the financial system through additional transactions until the "dirty money" appears
"clean".
Methods
Money laundering can take several forms, although most methods can be categorized
into one of a few types. These include "bank methods, smurfing [also known as
structuring], currency exchanges, and double-invoicing".
Structuring: Often known as smurfing, this is a method of placement whereby
cash is broken into smaller deposits of money, used to defeat suspicion of money
laundering and to avoid anti-money laundering reporting requirements. A subcomponent
of this is to use smaller amounts of cash to purchase bearer
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instruments, such as money orders, and then ultimately deposit those, again in
small amounts.
Bulk cash smuggling: This involves physically smuggling cash to another
jurisdiction and depositing it in a financial institution, such as an offshore bank,
with greater bank secrecy or less rigorous money laundering enforcement.
Cash-intensive businesses: In this method, a business typically expected to
receive a large proportion of its revenue as cash uses its accounts to deposit
criminally derived cash. Such enterprises often operate openly and in doing so
generate cash revenue from incidental legitimate business in addition to the illicit
cash – in such cases the business will usually claim all cash received as
legitimate earnings. Service businesses are best suited to this method, as such
enterprises have little or no variable costs and/or a large ratio between revenue
and variable costs, which makes it difficult to detect discrepancies between
revenues and costs. Examples are parking structures, strip clubs, tanning salons,
car washes, arcades, bars, restaurants, and casinos.
Trade-based laundering: This involves under- or over-valuing invoices to disguise
the movement of money. For example, the art market has been accused of being
an ideal vehicle for money laundering due to several unique aspects of art such
as the subjective value of artworks as well as the secrecy of auction houses
about the identity of the buyer and seller.
Shell companies and trusts: Trusts and shell companies disguise the true owners
of money. Trusts and corporate vehicles, depending on the jurisdiction, need not
disclose their true owner. Sometimes referred to by the slang term rathole,
though that term usually refers to a person acting as the fictitious owner rather
than the business entity.
Round-tripping: Here, money is deposited in a controlled foreign corporation
offshore, preferably in a tax haven where minimal records are kept, and then
shipped back as a foreign direct investment, exempt from taxation. A variant on
this is to transfer money to a law firm or similar organization as funds on account
of fees, then to cancel the retainer and, when the money is remitted, represent
the sums received from the lawyers as a legacy under a will or proceeds of
litigation.
Bank capture: In this case, money launderers or criminals buy a controlling
interest in a bank, preferably in a jurisdiction with weak money laundering
controls, and then move money through the bank without scrutiny.
Casinos: In this method, an individual walks into a casino and buys chips with
illicit cash. The individual will then play for a relatively short time. When the
person cashes in the chips, they will expect to take payment in a check, or at
least get a receipt so they can claim the proceeds as gambling winnings.
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Other gambling: Money is spent on gambling, preferably on high odds games.
One way to minimize risk with this method is to bet on every possible outcome of
some event that has many possible outcomes, so no outcome(s) have short
odds, and the bettor will lose only the vigorish and will have one or more winning
bets that can be shown as the source of money. The losing bets will remain
hidden.
Black salaries: A company may have unregistered employees without written
contracts and pay them cash salaries. Dirty money might be used to pay them.
Tax amnesties: For example, those that legalize unreported assets and cash in
tax havens.
Transaction Laundering: When a merchant unknowingly processes illicit credit
card transactions for another business. It is a growing problem and recognized
as distinct from traditional money laundering in using the payments ecosystem to
hide that the transaction even occurred (e.g. the use of fake front websites). Also
known as "undisclosed aggregation" or "factoring".
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By Region
Latin America
In Latin America, money laundering is mainly linked to drug trafficking activities and to
having connections with criminal activity, such as crimes that have to do with arms
trafficking, human trafficking, extortion, blackmail, smuggling, and acts of corruption of
people linked to governments, such as bribery, which are more common in Latin
American countries. There is a relationship between corruption and money laundering in
developing countries. The economic power of Latin America increases rapidly and
without support, these fortunes being of illicit origin have the appearance of legally
acquired profits. With regard to money laundering, the ultimate goal of the process is to
integrate illicit capital into the general economy and transform it into licit goods and
services.
The money laundering practice uses various channels to legalize everything achieved
through illegal practices. As such, it has different techniques depending on the country
where this illegal operation is going to be carried out:
In Colombia, the laundering of billions of dollars, which come from drug
trafficking, is carried out through imports of contraband from the parallel
exchange market.
In Central America in countries such as Guatemala and Honduras, money
laundering continues to increase in the absence of adequate legislation and
regulations in these countries. Money laundering activities in Costa Rica have
experienced substantial growth, especially using large-scale currency smuggling
and investments of drug cartels in real estate, within the tourism sector.
Furthermore, the Colon Free Zone, in Panama, continues to be the area of
operations for money laundering where cash is exchanged for products of
different nature that are then put up for sale at prices below those of production
for a return fast of the capital.
In Mexico, the preferred techniques continue to be the smuggling of currency
abroad, in addition to electronic transfers, bank drafts with Mexican banks and
operations in the parallel exchange market.
Money Laundering in the Caribbean countries continues to be a serious problem
that seems to be very dangerous. Specifically, in Antigua, the Dominican
Republic, Jamaica, Saint Vincent and the Grenadines. Citizens of the Dominican
Republic who have been involved in money laundering in the United States, use
companies that are dedicated to transferring funds sent to the Dominican
Republic in amounts of less than $10,000 under the use of false names.
Moreover, in Jamaica, multimillion-dollar asset laundering cases were discovered
through telephone betting operations abroad. Thousands of suspicious
transactions have been detected in French overseas territories. Free trade zones
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such as Aruba, meanwhile, remain the preferred areas for money laundering.
The offshore banking centers, the secret bank accounts and the tourist
complexes are the channels through which the launderers whiten the proceeds of
the illicit money.
Casinos continue to attract organizations that deal with money laundering. Aruba and
the Netherlands Antilles, the Cayman Islands, Colombia, Mexico, Panama and
Venezuela are considered high priority countries in the region, due to the strategies
used by the washers.
Economic Impact In The Region
The practice of money laundering, among other economic and financial crimes have
been better in infiltrating into the economic and political structures of most developing
countries therefore resulting to political instability and economic digression.
Money laundering is still a great concern for the financial services industry. About 50%
of the money laundering incidents in Latin America were reported by organizations in
the financial sector. According to PwC's 2014 global economic crime survey in Latin
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America only 2.8% of respondents in Latin America claimed suffering Anti-
Trust/Competition Law incidents, compared to 5.2% of respondents globally.
It has been shown that money laundering has an impact on the financial behavior and
macroeconomic performance of the industrialized countries. In these countries the
macroeconomic consequences of money laundering are transmitted through several
channels. Thus, money laundering complicates the formulation of economic policies. It
is assumed that the proceeds of criminal activities are laundered by means of the notes
and coins in circulation of the monetary substitutes.
The laundering causes disproportionate changes in the relative prices of assets which
implies that resources are allocated inefficiently; and, therefore may have negative
implications for economic growth, apparently money laundering is associated with a
lower economic growth.
The Office of National Drug Control Policy of the United States estimates that only in
that country, sales of narcotic drugs represent about 57,000 millions of dollars annually
and most of these transactions are made in cash.
Jurisprudence
Money laundering has been increasing. A key factor behind the growing money
laundering is ineffective enforcement of money laundering laws locally. Perhaps
because of the lack of importance that has been given to the subject, since the 21st
century started, there was not jurisprudence regarding the laundering of money or
assets, or the conversion or transfer of goods. Which is even worse, the laws of the
Latin American countries have really not dealt with their study in a profound way, as it is
an issue that concerns the whole world and is the subject of seminars, conferences and
academic analysis in different regions of the planet. Now a new figure that is being
called the Economic Criminal Law is being implemented, which should be implemented
in modern societies, which has been inflicted enormous damage to the point of affecting
the general economy of the states. Even though, developing countries have responded
and continue to respond, through legislative measures, to the problem of money
laundering, at national level, however, money launderers, have taken advantage of the
lax regulatory environment, vulnerable financial systems along with the continued civil
and political unrest of most the developing countries.
Magnitude
Many regulatory and governmental authorities issue estimates each year for the amount
of money laundered, either worldwide or within their national economy. In 1996, a
spokesperson for the IMF estimated that 2–5% of the worldwide global economy
involved laundered money. The Financial Action Task Force on Money Laundering
(FATF), an intergovernmental body set up to combat money laundering, stated, "Due to
the illegal nature of the transactions, precise statistics are not available and it is
therefore impossible to produce a definitive estimate of the amount of money that is
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globally laundered every year. The FATF therefore does not publish any figures in this
regard." Academic commentators have likewise been unable to estimate the volume of
money with any degree of assurance. Various estimates of the scale of global money
laundering are sometimes repeated often enough to make some people regard them as
factual—but no researcher has overcome the inherent difficulty of measuring an actively
concealed practice.
Regardless of the difficulty in measurement, the amount of money laundered each year
is in the billions of US dollars and poses a significant policy concern for governments.
As a result, governments and international bodies have undertaken efforts to deter,
prevent, and apprehend money launderers. Financial institutions have likewise
undertaken efforts to prevent and detect transactions involving dirty money, both as a
result of government requirements and to avoid the reputational risk involved. Issues
relating to money laundering have existed as long as there have been large scale
criminal enterprises. Modern anti-money laundering laws have developed along with the
modern War on Drugs. In more recent times anti-money laundering legislation is seen
as adjunct to the financial crime of terrorist financing in that both crimes usually involve
the transmission of funds through the financial system (although money laundering
relates to where the money has come from, and terrorist financing relating to where the
money is going to).
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Transaction laundering is a massive and growing problem. Finextra estimated that
transaction laundering accounted for over $200 billion in the US in 2017 alone, with over
$6 billion of these sales involving illicit goods or services, sold by nearly 335,000
unregistered merchants.
Electronic Money
In theory, electronic money should provide as easy a method of transferring value
without revealing identity as untracked banknotes, especially wire transfers involving
anonymity-protecting numbered bank accounts. In practice, however, the recordkeeping
capabilities of Internet service providers and other network resource
maintainers tend to frustrate that intention. While some cryptocurrencies under recent
development have aimed to provide for more possibilities of transaction anonymity for
various reasons, the degree to which they succeed—and, in consequence, the degree
to which they offer benefits for money laundering efforts—is controversial. Solutions
such as ZCash and Monero are examples of cryptocurrencies that provide unlinkable
anonymity via proofs and/or obfuscation of information (ring signatures). Such
currencies could find use in online illicit services.
In 2013, Jean-Loup Richet, a research fellow at ESSEC ISIS, surveyed new techniques
that cybercriminals were using in a report written for the United Nations Office on Drugs
and Crime. [33] A common approach was to use a digital currency exchanger service
which converted dollars into a digital currency called Liberty Reserve, and could be sent
and received anonymously. The receiver could convert the Liberty Reserve currency
back into cash for a small fee. In May 2013, the US authorities shut down Liberty
Reserve charging its founder and various others with money laundering.
Another increasingly common way of laundering money is to use online gaming. In a
growing number of online games, such as Second Life and World of Warcraft, it is
possible to convert money into virtual goods, services, or virtual cash that can later be
converted back into money.
Reverse Money Laundering
Reverse money laundering is a process that disguises a legitimate source of funds that
are to be used for illegal purposes. It is usually perpetrated for the purpose of financing
terrorism but can be also used by criminal organizations that have invested in legal
businesses and would like to withdraw legitimate funds from official circulation.
Unaccounted cash received via disguising financial transactions is not included in
official financial reporting and could be used to evade taxes, hand in bribes and pay
"under-the-table" salaries. For example, in an affidavit filed on 24 March 2014 in United
States District Court, Northern California, San Francisco Division, FBI special agent
Emmanuel V. Pascau alleged that several people associated with the Chee Kung Tong
organization, and California State Senator Leland Yee, engaged in reverse money
laundering activities.
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The problem of such fraudulent encashment practices (obnalichka in Russian) has
become acute in Russia and other countries of the former Soviet Union. The Eurasian
Group on Combating Money Laundering and Financing of Terrorism (EAG) reported
that the Russian Federation, Ukraine, Turkey, Serbia, Kyrgyzstan, Uzbekistan, Armenia
and Kazakhstan have encountered a substantial shrinkage of tax base and shifting
money supply balance in favor of cash. These processes have complicated planning
and management of the economy and contributed to the growth of the shadow
economy.
Combating
Anti-money laundering (AML) is a term mainly used in the financial and legal industries
to describe the legal controls that require financial institutions and other regulated
entities to prevent, detect, and report money laundering activities. Anti-money
laundering guidelines came into prominence globally as a result of the formation of the
Financial Action Task Force (FATF) and the promulgation of an international framework
of anti-money laundering standards. These standards began to have more relevance in
2000 and 2001, after FATF began a process to publicly identify countries that were
deficient in their anti-money laundering laws and international cooperation, a process
colloquially known as "name and shame".
An effective AML program requires a jurisdiction to criminalize money laundering, giving
the relevant regulators and police the powers and tools to investigate; be able to share
information with other countries as appropriate; and require financial institutions to
identify their customers, establish risk-based controls, keep records, and report
suspicious activities.
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Strict background checks are necessary to combat as many money launderers escape
by investing through complex ownership and company structures. Banks can do that but
a proper surveillance is required but on the Government side to reduce this.
Criminalization
The elements of the crime of money laundering are set forth in the United Nations
Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances and
Convention against Transnational Organized Crime. It is defined as knowingly engaging
in a financial transaction with the proceeds of a crime for the purpose of concealing or
disguising the illicit origin of the property from governments.
The Role of Financial Institutions
While banks operating in the same country generally have to follow the same antimoney
laundering laws and regulations, financial institutions all structure their antimoney
laundering efforts slightly differently. Today, most financial institutions globally,
and many non-financial institutions, are required to identify and report transactions of a
suspicious nature to the financial intelligence unit in the respective country. For
example, a bank must verify a customer's identity and, if necessary, monitor
transactions for suspicious activity. This is often termed as "know your customer". This
means knowing the identity of the customer and understanding the kinds of transactions
in which the customer is likely to engage. By knowing one's customers, financial
institutions can often identify unusual or suspicious behavior, termed anomalies, which
may be an indication of money laundering.
Bank employees, such as tellers and customer account representatives, are trained in
anti-money laundering and are instructed to report activities that they deem suspicious.
Additionally, anti-money laundering software filters customer data, classifies it according
to level of suspicion, and inspects it for anomalies. Such anomalies include any sudden
and substantial increase in funds, a large withdrawal, or moving money to a bank
secrecy jurisdiction. Smaller transactions that meet certain criteria may also be flagged
as suspicious. For example, structuring can lead to flagged transactions. The software
also flags names on government "blacklists" and transactions that involve countries
hostile to the host nation. Once the software has mined data and flagged suspect
transactions, it alerts bank management, who must then determine whether to file a
report with the government.
Value of Enforcement Costs and Associated Privacy Concerns
The financial services industry has become more vocal about the rising costs of antimoney
laundering regulation and the limited benefits that they claim it brings. One
commentator wrote that "[w]ithout facts, [anti-money laundering] legislation has been
driven on rhetoric, driving by ill-guided activism responding to the need to be "seen to
be doing something" rather than by an objective understanding of its effects on
predicate crime. The social panic approach is justified by the language used—we talk of
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the battle against terrorism or the war on drugs". The Economist magazine has become
increasingly vocal in its criticism of such regulation, particularly with reference to
countering terrorist financing, referring to it as a "costly failure", although it concedes
that other efforts (like reducing identity and credit card fraud) may still be effective at
combating money laundering.
There is no precise measurement of the costs of regulation balanced against the harms
associated with money laundering, and given the evaluation problems involved in
assessing such an issue, it is unlikely that the effectiveness of terror finance and money
laundering laws could be determined with any degree of accuracy. The Economist
estimated the annual costs of anti-money laundering efforts in Europe and North
America at US$5 billion in 2003, an increase from US$700 million in 2000. Governmentlinked
economists have noted the significant negative effects of money laundering on
economic development, including undermining domestic capital formation, depressing
growth, and diverting capital away from development. Because of the intrinsic
uncertainties of the amount of money laundered, changes in the amount of money
laundered, and the cost of anti-money laundering systems, it is almost impossible to tell
which anti-money laundering systems work and which are more or less cost effective.
Besides economic costs to implement anti-money-laundering laws, improper attention to
data protection practices may entail disproportionate costs to individual privacy rights. In
June 2011, the data-protection advisory committee to the European Union issued a
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eport on data protection issues related to the prevention of money laundering and
terrorist financing, which identified numerous transgressions against the established
legal framework on privacy and data protection. The report made recommendations on
how to address money laundering and terrorist financing in ways that safeguard
personal privacy rights and data protection laws. In the United States, groups such as
the American Civil Liberties Union have expressed concern that money laundering rules
require banks to report on their own customers, essentially conscripting private
businesses "into agents of the surveillance state".
Many countries are obligated by various international instruments and standards, such
as the 1988 United Nations Convention Against Illicit Traffic in Narcotic Drugs and
Psychotropic Substances, the 2000 Convention against Transnational Organized Crime,
the 2003 United Nations Convention against Corruption, and the recommendations of
the 1989 Financial Action Task Force on Money Laundering (FATF) to enact and
enforce money laundering laws in an effort to stop narcotics trafficking, international
organized crime, and corruption. Mexico, which has faced a significant increase in
violent crime, established anti-money laundering controls in 2013 to curb the underlying
crime issue.
Global Organizations
Formed in 1989 by the G7 countries, the Financial Action Task Force on Money
Laundering (FATF) is an intergovernmental body whose purpose is to develop and
promote an international response to combat money laundering. The FATF Secretariat
is housed at the headquarters of the OECD in Paris. In October 2001, FATF expanded
its mission to include combating the financing of terrorism. FATF is a policy-making
body that brings together legal, financial, and law enforcement experts to achieve
national legislation and regulatory AML and CFT reforms. As of 2014 its membership
consists of 36 countries and territories and two regional organizations. FATF works in
collaboration with a number of international bodies and organizations. These entities
have observer status with FATF, which does not entitle them to vote, but permits them
full participation in plenary sessions and working groups.
FATF has developed 40 recommendations on money laundering and 9 special
recommendations regarding terrorist financing. FATF assesses each member country
against these recommendations in published reports. Countries seen as not being
sufficiently compliant with such recommendations are subjected to financial sanctions.
FATF's three primary functions with regard to money laundering are:
1. Monitoring members’ progress in implementing anti-money laundering measures,
2. Reviewing and reporting on laundering trends, techniques, and
countermeasures, and
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3. Promoting the adoption and implementation of FATF anti-money laundering
standards globally.
The FATF currently comprises 34 member jurisdictions and 2 regional organizations,
representing most major financial centers in all parts of the globe.
The United Nations Office on Drugs and Crime maintains the International Money
Laundering Information Network, a website that provides information and software for
anti-money laundering data collection and analysis. The World Bank has a website that
provides policy advice and best practices to governments and the private sector on antimoney
laundering issues. The Basel AML Index is an independent annual ranking that
assesses the risk of money laundering and terrorist financing around the world.
Anti-Money-Laundering Measures by Region
Many jurisdictions adopt a list of specific predicate crimes for money laundering
prosecutions, while others criminalize the proceeds of any serious crimes.
Afghanistan
The Financial Transactions and Reports Analysis Center of Afghanistan (FinTRACA)
was established as a Financial Intelligence Unit (FIU) under the Anti Money Laundering
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and Proceeds of Crime Law passed by decree late in 2004. The main purpose of this
law is to protect the integrity of the Afghan financial system and to gain compliance with
international treaties and conventions. The Financial Intelligence Unit is a semiindependent
body that is administratively housed within the Central Bank of Afghanistan
(Da Afghanistan Bank). The main objective of FinTRACA is to deny the use of the
Afghan financial system to those who obtained funds as the result of illegal activity, and
to those who would use it to support terrorist activities.
To meet its objectives, the FinTRACA collects and analyzes information from a variety
of sources. These sources include entities with legal obligations to submit reports to the
FinTRACA when a suspicious activity is detected, as well as reports of cash
transactions above a threshold amount specified by regulation. Also, FinTRACA has
access to all related Afghan government information and databases. When the analysis
of this information supports the supposition of illegal use of the financial system, the
FinTRACA works closely with law enforcement to investigate and prosecute the illegal
activity. FinTRACA also cooperates internationally in support of its own analyses and
investigations and to support the analyses and investigations of foreign counterparts, to
the extent allowed by law. Other functions include training of those entities with legal
obligations to report information, development of laws and regulations to support
national-level AML objectives, and international and regional cooperation in the
development of AML typologies and countermeasures.
Australia
Australia has adopted a number of strategies to combat money laundering, which mirror
those of a majority of western countries. The Australian Transaction Reports and
Analysis Centre (AUSTRAC) is Australia's financial intelligence unit to combat money
laundering and terrorism financing, which requires financial institutions and other 'cash
dealers' in Australia to report to it suspicious cash or other transactions and other
specific information. The Attorney-General's Department maintains a list of outlawed
terror organizations. It is an offense to materially support or be supported by such
organizations. It is an offence to open a bank account in Australia in a false name, and
rigorous procedures must be followed when new bank accounts are opened.
The Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth) (AML/CTF
Act) is the principal legislative instrument, although there are also offence provisions
contained in Division 400 of the Criminal Code Act 1995 (Cth). Upon its introduction, it
was intended that the AML/CTF Act would be further amended by a second tranche of
reforms extending to designated non-financial businesses and professions (DNFBPs)
including, inter alia, lawyers, accountants, jewellers and real estate agents; however,
those further reforms have yet to be progressed.
The Proceeds of Crime Act 1987 (Cth) imposes criminal penalties on a person who
engages in money laundering, and allows for confiscation of property. The principal
objects of the Act are set out in s.3(1):
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to deprive persons of the proceeds of, and benefits derived from the commission
of offences,
to provide for the forfeiture of property used in or in connection with the
commission of such offences, and
to enable law enforcement authorities to effectively trace such proceeds, benefits
and property.
Bangladesh
The first anti-money laundering legislation in Bangladesh was the Money Laundering
Prevention Act, 2002. It was replaced by the Money Laundering Prevention Ordinance
2008. Subsequently, the ordinance was repealed by the Money Laundering Prevention
Act, 2009. In 2012, government again replace it with the Money Laundering Prevention
Act, 2012
In terms of section 2, "Money Laundering means – (i) knowingly moving, converting, or
transferring proceeds of crime or property involved in an offence for the following
purposes:- (1) concealing or disguising the illicit nature, source, location, ownership or
control of the proceeds of crime; or (2) assisting any person involved in the commission
of the predicate offence to evade the legal consequences of such offence; (ii) smuggling
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money or property earned through legal or illegal means to a foreign country; (iii)
knowingly transferring or remitting the proceeds of crime to a foreign country or
remitting or bringing them into Bangladesh from a foreign country with the intention of
hiding or disguising its illegal source; or (iv) concluding or attempting to conclude
financial transactions in such a manner so as to reporting requirement under this Act
may be avoided; (v) converting or moving or transferring property with the intention to
instigate or assist for committing a predicate offence; (vi) acquiring, possessing or using
any property, knowing that such property is the proceeds of a predicate offence; (vii)
performing such activities so as to the illegal source of the proceeds of crime may be
concealed or disguised; (viii) participating in, associating with, conspiring, attempting,
abetting, instigate or counsel to commit any offences mentioned above."
To prevent these Illegal uses of money, the Bangladesh government has introduced the
Money Laundering Prevention Act. The Act was last amended in the year 2009 and all
the financial institutes are following this act.
Till today there are 26 circulars issued by Bangladesh Bank under this act. To prevent
money laundering, a banker must do the following:
While opening a new account, the account opening form should be duly filled up
by all the information of the customer.
The KYC must be properly filled.
The Transaction Profile (TP) is mandatory for a client to understand his/her
transactions. If needed, the TP must be updated at the client's consent.
All other necessary papers should be properly collected along with the National
ID card.
If any suspicious transaction is noticed, the Branch Anti Money Laundering
Compliance Officer (BAMLCO) must be notified and accordingly the Suspicious
Transaction Report (STR) must be filled out.
The cash department should be aware of the transactions. It must be noted if
suddenly a big amount of money is deposited in any account. Proper documents
are required if any client does this type of transaction.
Structuring, over/ under invoicing is another way to do money laundering. The
foreign exchange department should look into this matter cautiously.
If any account has a transaction over 1 million taka in a single day, it must be
reported in a cash transaction report (CTR).
All bank officials must go through all the 26 circulars and use them.
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Canada
In 1991, the Proceeds of Crime (Money Laundering) Act was brought into force in
Canada to give legal effect to the former FATF Forty Recommendations by establishing
record keeping and client identification requirements in the financial sector to facilitate
the investigation and prosecution of money laundering offences under the Criminal
Code and the Controlled Drugs and Substances Act.
In 2000, the Proceeds of Crime (Money Laundering) Act was amended to expand the
scope of its application and to establish a financial intelligence unit with national control
over money laundering, namely FINTRAC.
In December 2001, the scope of the Proceeds of Crime (Money Laundering) Act was
again expanded by amendments enacted under the Anti-Terrorism Act with the
objective of deterring terrorist activity by cutting off sources and channels of funding
used by terrorists in response to 9/11. The Proceeds of Crime (Money Laundering) Act
was renamed the Proceeds of Crime (Money Laundering) and Terrorist Financing Act.
In December 2006, the Proceeds of Crime (Money Laundering) and Terrorist Financing
Act was further amended, in part, in response to pressure from the FATF for Canada to
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tighten its money laundering and financing of terrorism legislation. The amendments
expanded the client identification, record-keeping and reporting requirements for certain
organizations and included new obligations to report attempted suspicious transactions
and outgoing and incoming international electronic fund transfers, undertake risk
assessments and implement written compliance procedures in respect of those risks.
The amendments also enabled greater money laundering and terrorist financing
intelligence-sharing among enforcement agencies.
In Canada, casinos, money service businesses, notaries, accountants, banks, securities
brokers, life insurance agencies, real estate salespeople and dealers in precious metals
and stones are subject to the reporting and record keeping obligations under the
Proceeds of Crime (Money Laundering) and Terrorist Financing Act. However in recent
years, casinos and realtors have been embroiled in scandal for aiding and abetting
money launderers, especially in Vancouver. Some have speculated that approximately
$1 Billion is laundered in Vancouver per year.
European Union
The fourth iteration of the EU's anti-money laundering directive (AMLD IV) was
published on 5 June 2015, after clearing its last legislative stop at the European
Parliament. This directive brought the EU's money laundering laws more in line with the
US's, which is advantageous for financial institutions operating in both jurisdictions. The
Fifth Money Laundering Directive (5MLD) comes into force on 10 January 2020,
addressing a number of weaknesses in the European Union's AML/CFT regime that
came to light after the enactment of the Fourth Money Laundering Directive AMLD IV).
Lack of harmonization in AML requirements between the US and EU has complicated
the compliance efforts of global institutions that are looking to standardize the Know
Your Customer (KYC) component of their AML programs across key jurisdictions.
AMLD IV promises to better align the AML regimes by adopting a more risk-based
approach compared to its predecessor, AMLD III.
Certain components of the directive, however, go beyond current requirements in both
the EU and US, imposing new implementation challenges on banks. For instance, more
public officials are brought within the scope of the directive, and EU member states are
required to establish new registries of "beneficial owners" (i.e., those who ultimately own
or control each company) which will impact banks. AMLD IV became effective 25 June
2015.
On 24 January 2019, the European Commission sent official warnings to ten member
states as part of a crackdown on lax application of money laundering regulations. The
Commission sent Germany a letter of formal notice, the first step of the EU legal
procedure against states. Belgium, Finland, France, Lithuania and Portugal were sent
reasoned opinions, the second step of the procedure which could lead to fines. A
second round of reasoned opinions was sent to Bulgaria, Cyprus, Poland, and Slovakia.
The ten countries have two months to respond or face court action. The Commission
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had set a 26 June 2017 deadline for EU countries to apply new rules against money
laundering and terrorist financing.
On 13 February 2019, the Commission added Saudi Arabia, Panama, Nigeria and other
jurisdictions to a blacklist of nations that pose a threat because of lax controls on
terrorism financing and money laundering. This is a more expansive list than that of
FATF.
India
In 2002, the Parliament of India passed an act called the Prevention of Money
Laundering Act, 2002. The main objectives of this act are to prevent money-laundering
as well as to provide for confiscation of property either derived from or involved in,
money-laundering.
Section 12 (1) describes the obligations that banks, other financial institutions, and
intermediaries have to:
(a) Maintain records that detail the nature and value of transactions, whether
such transactions comprise a single transaction or a series of connected
transactions, and where these transactions take place within a month.
(b) Furnish information on transactions referred to in clause (a) to the Director
within the time prescribed, including records of the identity of all its clients.
Section 12 (2) prescribes that the records referred to in sub-section (1) as
mentioned above, must be maintained for ten years after the transactions
finished. It is handled by the Indian Income Tax Department.
The provisions of the Act are frequently reviewed and various amendments have been
passed from time to time.
Most money laundering activities in India are through political parties, corporate
companies and the shares market. These are investigated by the Enforcement
Directorate and Indian Income Tax Department. According to Government of India, out
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of the total tax arrears of ₹2,480 billion (US$35 billion) about ₹1,300 billion
(US$18 billion) pertain to money laundering and securities scam cases.
Bank accountants must record all transactions over Rs. 1 million and maintain such
records for 10 years.
Banks must also make cash transaction reports (CTRs) and suspicious transaction
reports over Rs. 1 million within 7 days of initial suspicion. They must submit their
reports to the Enforcement Directorate and Income Tax Department.
Singapore
Singapore’s legal framework for combating money laundering is contained in a
patchwork of legal instruments, the main elements of which are:
The Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of
Benefits) Act (CDSA). This statute criminalizes money laundering and imposes
the requirement for persons to file suspicious transaction reports (STRs) and
make a disclosure whenever physical currency or goods exceeding S$20,000 are
carried into or out of Singapore.
The Mutual Assistance in Criminal Matters Act (MACMA). This statute sets out
the framework for mutual legal assistance in criminal matters.
Legal instruments issued by regulatory agencies (such as the Monetary Authority
of Singapore (MAS), in relation to financial institutions (FIs)) imposing
requirements to conduct customer due diligence (CDD).
The term ‘money laundering’ is not used as such within the CDSA. Part VI of the CDSA
criminalizes the laundering of proceeds generated by criminal conduct and drug tracking
via the following offences:
The assistance of another person in retaining, controlling or using the benefits of
drug dealing or criminal conduct under an arrangement (whether by
concealment, removal from jurisdiction, transfer to nominees or otherwise)
[section 43(1)/44(1)].
The concealment, conversion, transfer or removal from the jurisdiction, or the
acquisition, possession or use of benefits of drug dealing or criminal conduct
[section 46(1)/47(1)].
The concealment, conversion, transfer or removal from the jurisdiction of another
person's benefits of drug dealing or criminal conduct [section 46(2)/47(2)].
The acquirement, possession or use of another person's benefits of drug dealing
or criminal conduct [section 46(3)/47(3)].
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Thailand
United Kingdom
Money laundering and terrorist funding legislation in the UK is governed by five Acts of
primary legislation:-
Terrorism Act 2000
Anti-terrorism, Crime and Security Act 2001
Proceeds of Crime Act 2002
Serious Organized Crime and Police Act 2005
Sanctions and Anti-Money Laundering Act 2018
Money Laundering Regulations are designed to protect the UK financial system, as well
as preventing and detecting crime. If a business is covered by these regulations then
controls are put in place to prevent it being used for money laundering.
The Proceeds of Crime Act 2002 contains the primary UK anti-money laundering
legislation, including provisions requiring businesses within the "regulated sector"
(banking, investment, money transmission, certain professions, etc.) to report to the
authorities suspicions of money laundering by customers or others.
Money laundering is broadly defined in the UK. In effect any handling or involvement
with any proceeds of any crime (or monies or assets representing the proceeds of
crime) can be a money laundering offence. An offender's possession of the proceeds of
his own crime falls within the UK definition of money laundering. The definition also
covers activities within the traditional definition of money laundering, as a process that
conceals or disguises the proceeds of crime to make them appear legitimate.
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Unlike certain other jurisdictions (notably the US and much of Europe), UK money
laundering offences are not limited to the proceeds of serious crimes, nor are there any
monetary limits. Financial transactions need no money laundering design or purpose for
UK laws to consider them a money laundering offence. A money laundering offence
under UK legislation need not even involve money, since the money laundering
legislation covers assets of any description. In consequence, any person who commits
an acquisitive crime (i.e., one that produces some benefit in the form of money or an
asset of any description) in the UK inevitably also commits a money laundering offence
under UK legislation.
This applies also to a person who, by criminal conduct, evades a liability (such as a
taxation liability)—which lawyers call "obtaining a pecuniary advantage"—as he is
deemed thereby to obtain a sum of money equal in value to the liability evaded.
The principal money laundering offences carry a maximum penalty of 14 years'
imprisonment.
Secondary regulation is provided by the Money Laundering Regulations 2003, which
was replaced by the Money Laundering Regulations 2007. They are directly based on
the EU directives 91/308/EEC, 2001/97/EC and 2005/60/EC.
One consequence of the Act is that solicitors, accountants, tax advisers, and insolvency
practitioners who suspect (as a consequence of information received in the course of
their work) that their clients (or others) have engaged in tax evasion or other criminal
conduct that produced a benefit, now must report their suspicions to the authorities
(since these entail suspicions of money laundering). In most circumstances it would be
an offence, "tipping-off", for the reporter to inform the subject of his report that a report
has been made. These provisions do not however require disclosure to the authorities
of information received by certain professionals in privileged circumstances or where
the information is subject to legal professional privilege. Others that are subject to these
regulations include financial institutions, credit institutions, estate agents (which includes
chartered surveyors), trust and company service providers, high value dealers (who
accept cash equivalent to €15,000 or more for goods sold), and casinos.
Professional guidance (which is submitted to and approved by the UK Treasury) is
provided by industry groups including the Joint Money Laundering Steering Group, the
Law Society. and the Consultative Committee of Accountancy Bodies (CCAB).
However, there is no obligation on banking institutions to routinely report monetary
deposits or transfers above a specified value. Instead reports must be made of all
suspicious deposits or transfers, irrespective of their value.
The reporting obligations include reporting suspicious gains from conduct in other
countries that would be criminal if it took place in the UK. Exceptions were later added
for certain activities legal where they took place, such as bullfighting in Spain.
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More than 200,000 reports of suspected money laundering are submitted annually to
authorities in the UK (there were 240,582 reports in the year ended 30 September 2010.
This was an increase from the 228,834 reports submitted in the previous year). Most of
these reports are submitted by banks and similar financial institutions (there were
186,897 reports from the banking sector in the year ended 30 September 2010).
Although 5,108 different organizations submitted suspicious activity reports to the
authorities in the year ended 30 September 2010, just four organizations submitted
approximately half of all reports, and the top 20 reporting organizations accounted for
three-quarters of all reports.
The offence of failing to report a suspicion of money laundering by another person
carries a maximum penalty of 5 years' imprisonment.
On 1 May 2018, the UK House of Commons, without opposition, passed the Sanctions
and Anti-Money Laundering Bill, which will set out the UK government's intended
approach to exceptions and licenses when the nation becomes responsible for
implementing its own sanctions and will also require notorious overseas British territory
tax havens such as the Cayman Islands and the British Virgin Islands to establish public
registers of the beneficial ownership of firms in their jurisdictions by the end of 2020.
The legislation was passed by the House of Lords on 21 May and received Royal Asset
on 23 May. However, the Act's public register provision is facing legal challenges from
local governments in the Cayman Islands and British Virgin Islands, who argue that it
violates their Constitutional sovereignty.
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Bureaux de Change
All UK Bureaux de change are registered with Her Majesty's Revenue and Customs,
which issues a trading license for each location. Bureaux de change and money
transmitters, such as Western Union outlets, in the UK fall within the "regulated sector"
and are required to comply with the Money Laundering Regulations 2007. Checks can
be carried out by HMRC on all Money Service Businesses.
South Africa
In South Africa, the Financial Intelligence Centre Act (2001) and subsequent
amendments have added responsibilities to the FSB to combat money laundering.
United States
The approach in the United States to stopping money laundering is usually broken into
two areas: preventive (regulatory) measures and criminal measures.
Preventive
In an attempt to prevent dirty money from entering the U.S. financial system in the first
place, the United States Congress passed a series of laws, starting in 1970, collectively
known as the Bank Secrecy Act (BSA). These laws, contained in sections 5311 through
5332 of Title 31 of the United States Code, require financial institutions, which under the
current definition include a broad array of entities, including banks, credit card
companies, life insurers, money service businesses and broker-dealers in securities, to
report certain transactions to the United States Department of the Treasury. Cash
transactions in excess of a certain amount must be reported on a currency transaction
report (CTR), identifying the individual making the transaction as well as the source of
the cash. The law originally required all transactions of US$5,000 or more to be
reported, but due to excessively high levels of reporting the threshold was raised to
US$10,000. The U.S. is one of the few countries in the world to require reporting of all
cash transactions over a certain limit, although certain businesses can be exempt from
the requirement. Additionally, financial institutions must report transaction on a
Suspicious Activity Report (SAR) that they deem "suspicious", defined as a knowing or
suspecting that the funds come from illegal activity or disguise funds from illegal activity,
that it is structured to evade BSA requirements or appears to serve no known business
or apparent lawful purpose; or that the institution is being used to facilitate criminal
activity. Attempts by customers to circumvent the BSA, generally by structuring cash
deposits to amounts lower than US$10,000 by breaking them up and depositing them
on different days or at different locations also violates the law.
The financial database created by these reports is administered by the U.S.'s Financial
Intelligence Unit (FIU), called the Financial Crimes Enforcement Network (FinCEN),
located in Vienna, Virginia. The reports are made available to U.S. criminal
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investigators, as well as other FIU's around the globe, and FinCEN conducts computer
assisted analyses of these reports to determine trends and refer investigations.
The BSA requires financial institutions to engage in customer due diligence, or KYC,
which is sometimes known in the parlance as know your customer. This includes
obtaining satisfactory identification to give assurance that the account is in the
customer's true name, and having an understanding of the expected nature and source
of the money that flows through the customer's accounts. Other classes of customers,
such as those with private banking accounts and those of foreign government officials,
are subjected to enhanced due diligence because the law deems that those types of
accounts are a higher risk for money laundering. All accounts are subject to ongoing
monitoring, in which internal bank software scrutinizes transactions and flags for manual
inspection those that fall outside certain parameters. If a manual inspection reveals that
the transaction is suspicious, the institution should file a Suspicious Activity Report.
The regulators of the industries involved are responsible to ensure that the financial
institutions comply with the BSA. For example, the Federal Reserve and the Office of
the Comptroller of the Currency regularly inspect banks, and may impose civil fines or
refer matters for criminal prosecution for non-compliance. A number of banks have been
fined and prosecuted for failure to comply with the BSA. Most famously, Riggs Bank, in
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Washington D.C., was prosecuted and functionally driven out of business as a result of
its failure to apply proper money laundering controls, particularly as it related to foreign
political figures.
In addition to the BSA, the U.S. imposes controls on the movement of currency across
its borders, requiring individuals to report the transportation of cash in excess of
US$10,000 on a form called Report of International Transportation of Currency or
Monetary Instruments (known as a CMIR). Likewise, businesses, such as automobile
dealerships, that receive cash in excess of US$10,000 must file a Form 8300 with the
Internal Revenue Service, identifying the source of the cash.
On 1 September 2010, the Financial Crimes Enforcement Network issued an advisory
on "informal value transfer systems" referencing United States v. Banki.
In the United States, there are perceived consequences of anti-money laundering (AML)
regulations. These unintended consequences include FinCEN's publishing of a list of
"risky businesses," which many believe unfairly targeted money service businesses.
The publishing of this list and the subsequent fall-out, banks indiscriminately de-risking
MSBs, is referred to as Operation Choke Point. The Financial Crimes Enforcement
Network issued a Geographic Targeting Order to combat against illegal money
laundering in the United States. This means that title insurance companies in the U.S.
are required to identify the natural persons behind companies that pay all cash in
residential real estate purchases over a particular amount in certain U.S. cities.
Criminal Sanctions
Money laundering has been criminalized in the United States since the Money
Laundering Control Act of 1986. The law, contained at section 1956 of Title 18 of the
United States Code, prohibits individuals from engaging in a financial transaction with
proceeds that were generated from certain specific crimes, known as "specified unlawful
activities" (SUAs). The law requires that an individual specifically intend in making the
transaction to conceal the source, ownership or control of the funds. There is no
minimum threshold of money, and no requirement that the transaction succeeded in
actually disguising the money. A "financial transaction" has been broadly defined, and
need not involve a financial institution, or even a business. Merely passing money from
one person to another, with the intent to disguise the source, ownership, location or
control of the money, has been deemed a financial transaction under the law. The
possession of money without either a financial transaction or an intent to conceal is not
a crime in the United States. Besides money laundering, the law contained in section
1957 of Title 18 of the United States Code, prohibits spending more than US$10,000
derived from an SUA, regardless of whether the individual wishes to disguise it. It
carries a lesser penalty than money laundering, and unlike the money laundering
statute, requires that the money pass through a financial institution.
According to the records compiled by the United States Sentencing Commission, in
2009, the United States Department of Justice typically convicted a little over 81,000
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people; of this, approximately 800 are convicted of money laundering as the primary or
most serious charge. The Anti-Drug Abuse Act of 1988 expanded the definition of
financial institution to include businesses such as car dealers and real estate closing
personnel and required them to file reports on large currency transaction. It required
verification of identity of those who purchase monetary instruments over $3,000. The
Annunzio-Wylie Anti-Money Laundering Act of 1992 strengthened sanctions for BSA
violations, required so called "Suspicious Activity Reports" and eliminated previously
used "Criminal Referral Forms", required verification and recordkeeping for wire
transfers and established the Bank Secrecy Act Advisory Group (BSAAG). The Money
Laundering Suppression Act from 1994 required banking agencies to review and
enhance training, develop anti-money laundering examination procedures, review and
enhance procedures for referring cases to law enforcement agencies, streamlined the
Currency transaction report exemption process, required each Money services business
(MSB) to be registered by an owner or controlling person, required every MSB to
maintain a list of businesses authorized to act as agents in connection with the financial
services offered by the MSB, made operating an unregistered MSB a federal crime, and
recommended that states adopt uniform laws applicable to MSBs. The Money
Laundering and Financial Crimes Strategy Act of 1998 required banking agencies to
develop anti-money laundering training for examiners, required the Department of the
Treasury and other agencies to develop a "National Money Laundering Strategy",
created the "High Intensity Money Laundering and Related Financial Crime Area"
(HIFCA) Task Forces to concentrate law enforcement efforts at the federal, state and
local levels in zones where money laundering is prevalent. HIFCA zones may be
defined geographically or can be created to address money laundering in an industry
sector, a financial institution, or group of financial institutions.
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The Intelligence Reform & Terrorism Prevention Act of 2004 amended the Bank
Secrecy Act to require the Secretary of the Treasury to prescribe regulations requiring
certain financial institutions to report cross-border electronic transmittals of funds, if the
Secretary determines that reporting is "reasonably necessary" in "anti-money laundering
/combatting financing of terrorists (Anti-Money Laundering/Combating the Financing of
Terrorism AML/CFT)."
Notable Cases
1998 investigation, United States Senate, Contribution Laundering/Third-Party
Transfers. Includes investigation of Gandhi Memorial International Foundation.
Bank of Credit and Commerce International: Unknown amount, estimated in
billions, of criminal proceeds, including drug trafficking money, laundered during
the mid-1980s.
BTA Bank: $6 billion of bank funds embezzled or fraudulently loaned to shell
companies and offshore holdings by the banks former chairman and CEO
Mukhtar Ablyazov.
Bank of New York: US$7 billion of Russian capital flight laundered through
accounts controlled by bank executives, late 1990s.
Charter House Bank: Charter House Bank in Kenya was placed under statutory
management in 2006 by the Central Bank of Kenya after it was discovered the
bank was being used for money laundering activities by multiple accounts
containing missing customer information. More than $1.5 billion had been
laundered before the scam was uncovered.
Danske Bank + Swedbank: $30 billion - $230 billion US dollars laundered
through its Estonian branch. This was revealed on 19 September 2018.
Investigations by Denmark, Estonia, the U.K. and the U.S. were joined by France
in February 2019. On 19 February 2019, Danske Bank announced that it would
cease operating in Russia and the Baltic States. This statement came shortly
after Estonia's banking regulator Finantsinspektsioon announced that they would
close the Estonian branch of Danske Bank. The investigation has grown to
include Swedbank, which may have laundered $4.3 billion. More at Danske Bank
money laundering scandal.
Ferdinand Marcos: Unknown amount, estimated at US$10 billion of government
assets laundered through banks and financial institutions in the United States,
Liechtenstein, Austria, Panama, Netherlands Antilles, Cayman Islands, Vanuatu,
Hong Kong, Singapore, Monaco, the Bahamas, the Vatican and Switzerland.
HSBC, in December 2012, paid a record $1.9 Billion fines for money-laundering
hundreds of millions of dollars for drug traffickers, terrorists and sanctioned
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governments such as Iran. The money-laundering occurred throughout the
2000s.
Institute for the Works of Religion: Italian authorities investigated suspected
money laundering transactions amounting to US$218 million made by the IOR to
several Italian banks.
Liberty Reserve, in May 2013, was seized by United States federal authorities for
laundering $6 billion.
Nauru: US$70 billion of Russian capital flight laundered through unregulated
Nauru offshore shell banks, late 1990s
Sani Abacha: US$2–5 billion of government assets laundered through banks in
the UK, Luxembourg, Jersey (Channel Islands), and Switzerland, by the
president of Nigeria.
Standard Chartered: paid $330 million in fines for money-laundering hundreds of
billions of dollars for Iran. The money-laundering took place in the 2000s and
occurred for "nearly a decade to hide 60,000 transactions worth $250 billion".
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Standard Bank: Standard Bank South Africa London Branch – The Financial
Conduct Authority (FCA) has fined Standard Bank PLC (Standard Bank)
£7,640,400 for failings relating to its anti-money laundering (AML) policies and
procedures over corporate and private bank customers connected to politically
exposed persons (PEPs).
BNP Paribas, in June 2014, pleaded guilty to falsifying business records and
conspiracy, having violated U.S. sanctions against Cuba, Iran, and Sudan. It
agreed to pay an $8.9 billion fine, the largest ever for violating U.S. sanctions.
BSI Bank, in May 2017, was shut down by the Monetary Authority of Singapore
for serious breaches of anti-money laundering requirements, poor management
oversight of the bank's operations, and gross misconduct of some of the bank's
staff.
Jose Franklin Jurado-Rodriguez, a Harvard College and Columbia University
Graduate School of Arts and Sciences Economics Department alumnus, was
convicted in Luxembourg in June 1990 "in what was one of the largest drug
money laundering cases ever brought in Europe" and the US in 1996 of money
laundering for the Cali Cartel kingpin Jose Santacruz Londono. Jurado-
Rodriguez specialized in "smurfing".
Fortnite. In 2018 Cybersecurity firm Sixgill posed as customers and discovered
that stolen credit card details may have used to purchase Fortnite's in-game
currency (V-Bucks) then in-game purchases, to be sold for "clean"
money. [155][156][157] Epic Games, the makers of Fortnite, responded by urging
customers to secure their accounts.
Digital Money and Money Laundering
To prevent the usage of decentralized digital money such as Bitcoin for the profit of
crime and corruption, Australia is planning to strengthen the nation's anti-money
laundering laws. The characteristics of Bitcoin—it is completely deterministic, protocol
based and cannot be censored—make it possible to circumvent national laws using
services like Tor to obfuscate transaction origins. Bitcoin relies completely on
cryptography, not on a central entity running under a KYC framework. There are several
cases in which criminals have cashed out a significant amount of Bitcoin after
ransomware attacks, drug dealings, cyber fraud and gunrunning.
Additional cases, such as The DAO being drained of Ether, cannot be classified as
money laundering under any legal definition, as decentralized virtual environments are
legally stateless and cannot be intervened with by a governing body. The DAO incident
initiated debate regarding the definition of money laundering in a stateless environment,
leading to the formation of Ethereum Classic.
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XIV. Murder
Murder is the unlawful killing of another human without justification or valid excuse,
especially the unlawful killing of another human being with malice aforethought. [1][2][3]
This state of mind may, depending upon the jurisdiction, distinguish murder from other
forms of unlawful homicide, such as manslaughter. Manslaughter is a killing committed
in the absence of malice, brought about by reasonable provocation, or diminished
capacity. Involuntary manslaughter, where it is recognized, is a killing that lacks all but
the most attenuated guilty intent, recklessness.
Most societies consider murder to be an extremely serious crime, and thus believe that
the person charged should receive harsh punishments for the purposes of retribution,
deterrence, rehabilitation, or incapacitation.
In most countries, a person convicted of murder generally faces a long-term prison
sentence, possibly a life sentence; and in a few, the death penalty may be imposed.
Etymology
The modern English word "murder" descends from the Proto-Indo-European "mrtró"
which meant "to die". The Middle English mordre is a noun from Anglo-Saxon morðor
and Old French murdre. Middle English mordre is a verb from Anglo-Saxon myrdrian
and the Middle English noun.
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Definition
The eighteenth-century English jurist William Blackstone (citing Edward Coke), in his
Commentaries on the Laws of England set out the common law definition of murder,
which by this definition occurs when a person, of sound memory and discretion,
unlawfully kills any reasonable creature in being and under the king's peace, with malice
aforethought, either express or implied.
The elements of common law murder are:
1. Unlawful
2. Killing
3. Through Criminal Act or Omission
4. of a Human
5. by another Human
6. with Malice Aforethought.
The Unlawful – This distinguishes murder from killings that are done within the boundaries of law,
such as capital punishment, justified self-defense, or the killing of enemy combatants by lawful
combatants as well as causing collateral damage to non-combatants during a war.
Killing – At common law life ended with cardiopulmonary arrest – the total and irreversible cessation
of blood circulation and respiration. With advances in medical technology courts have adopted
irreversible cessation of all brain function as marking the end of life.
Сriminal Act or Omission – Killing can be committed by an act or an omission.
of a Human – This element presents the issue of when life begins. At common law, a fetus was not a
human being. Life began when the fetus passed through the vagina and took its first breath.
by another Human – In early common law, suicide was considered murder. The requirement that the
person killed be someone other than the perpetrator excluded suicide from the definition of murder.
with Malice Aforethought – Originally malice aforethought carried its everyday meaning – a
deliberate and premeditated (prior intent) killing of another motivated by ill will. Murder necessarily
required that an appreciable time pass between the formation and execution of the intent to kill. The
courts broadened the scope of murder by eliminating the requirement of actual premeditation and
deliberation as well as true malice. All that was required for malice aforethought to exist is that the
perpetrator act with one of the four states of mind that constitutes "malice".
The four states of mind recognized as constituting "malice" are:
i. Intent to kill,
ii. Intent to inflict grievous bodily harm short of death,
iii. Reckless indifference to an unjustifiably high risk to human life (sometimes
described as an "abandoned and malignant heart"), or
iv. Intent to commit a dangerous felony (the "felony murder" doctrine).
Under state of mind (i), intent to kill, the deadly weapon rule applies. Thus, if the
defendant intentionally uses a deadly weapon or instrument against the victim, such use
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authorizes a permissive inference of intent to kill. In other words, "intent follows the
bullet". Examples of deadly weapons and instruments include but are not limited to
guns, knives, deadly toxins or chemicals or gases and even vehicles when intentionally
used to harm one or more victims.
Under state of mind (iii), an "abandoned and malignant heart", the killing must result
from the defendant's conduct involving a reckless indifference to human life and a
conscious disregard of an unreasonable risk of death or serious bodily injury. In
Australian jurisdictions, the unreasonable risk must amount to a foreseen probability of
death (or grievous bodily harm in most states), as opposed to possibility.
Under state of mind (iv), the felony-murder doctrine, the felony committed must be an
inherently dangerous felony, such as burglary, arson, rape, robbery or kidnapping.
Importantly, the underlying felony cannot be a lesser included offense such as assault,
otherwise all criminal homicides would be murder as all are felonies.
As with most legal terms, the precise definition of murder varies between jurisdictions
and is usually codified in some form of legislation. Even when the legal distinction
between murder and manslaughter is clear, it is not unknown for a jury to find a murder
defendant guilty of the lesser offence.
The jury might sympathize with the defendant (e.g. in a crime of passion, or in the case
of a bullied victim who kills their tormentor), and the jury may wish to protect the
defendant from a sentence of life imprisonment or execution.
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Degrees of Murder
"Murder in the second degree" redirects here. For the 2016 album, see Murder in the
Second Degree.
Many jurisdictions divide murder by degrees. The distinction between first- and seconddegree
murder exists, for example, in Canadian murder law and U.S. murder law.
The most common division is between first- and second-degree murder. Generally,
second-degree murder is common law murder, and first-degree is an aggravated form.
The aggravating factors of first-degree murder depend on the jurisdiction, but may
include a specific intent to kill, premeditation, or deliberation. In some, murder
committed by acts such as strangulation, poisoning, or lying in wait are also treated as
first-degree murder. A few states in the U.S. further distinguish third-degree murder, but
they differ significantly in which kinds of murders they classify as second-degree versus
third-degree. For example, Minnesota defines third-degree murder as depraved-heart
murder, whereas Florida defines third-degree murder as felony murder (except when
the underlying felony is specifically listed in the definition of first-degree murder).
Some jurisdictions also distinguish premeditated murder. This is the crime of wrongfully
and intentionally causing the death of another human being (also known as murder)
after rationally considering the timing or method of doing so, in order to either increase
the likelihood of success, or to evade detection or apprehension. State laws in the
United States vary as to definitions of "premeditation". In some states, premeditation
may be construed as taking place mere seconds before the murder. Premeditated
murder is one of the most serious forms of homicide, and is punished more severely
than manslaughter or other types of murder, often with a life sentence without the
possibility of parole, or in some countries, the death penalty. In the U.S, federal law (18
U.S.C. § 1111(a)) criminalizes premeditated murder, felony murder and second-degree
murder committed under situations where federal jurisdiction applies. In Canada, the
Criminal Code classifies murder as either 1st- or 2nd-degree. The former type of murder
is often called premeditated murder, although premeditation is not the only way murder
can be classified as first-degree.
Common Law
According to Blackstone, English common law identified murder as a public wrong.
According to common law, murder is considered to be malum in se, that is an act which
is evil within itself. An act such as murder is wrong or evil by its very nature. And it is the
very nature of the act which does not require any specific detailing or definition in the
law to consider murder a crime.
Some jurisdictions still take a common law view of murder. In such jurisdictions, what is
considered to be murder is defined by precedent case law or previous decisions of the
courts of law. However, although the common law is by nature flexible and adaptable, in
the interests both of certainty and of securing convictions, most common law
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jurisdictions have codified their criminal law and now have statutory definitions of
murder.
General
Exclusions
Although laws vary by country, there are circumstances of exclusion that are common in
many legal systems.
Killing of Enemy Combatants who have not surrendered by lawful combatants,
in accordance with lawful orders in war, is also generally not considered murder;
although illicit killings within a war may constitute murder or homicidal war
crimes. (see the Laws of war article)
Self-Defense: acting in self-defense or in defense of another person is generally
accepted as legal justification for killing a person in situations that would
otherwise have been murder. However, a self-defense killing might be
considered manslaughter if the killer established control of the situation before
the killing took place. In the case of self-defense it is called a "justifiable
homicide".
Unlawful killings without malice or intent are considered manslaughter.
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In many common law countries, provocation is a partial defense to a charge of
murder which acts by converting what would otherwise have been murder into
manslaughter (this is voluntary manslaughter, which is more severe than
involuntary manslaughter).
Accidental killings are considered homicides. Depending on the circumstances,
these may or may not be considered criminal offenses; they are often considered
manslaughter.
Suicide does not constitute murder in most societies. Assisting a suicide,
however, may be considered murder in some circumstances.
Specific to Certain Countries
Capital Punishment: some countries practice the death penalty. Capital
punishment may be ordered by a legitimate court of law as the result of a
conviction in a criminal trial with due process for a serious crime. The 47 Member
States of the Council of Europe are prohibited from using the death penalty.
Euthanasia, doctor-assisted suicide: the administration of lethal drugs by a
doctor to a terminally ill patient, if the intention is solely to alleviate pain, in many
jurisdictions it is seen as a special case (see the doctrine of double effect and the
case of Dr John Bodkin Adams).
Killing to Prevent The Theft of One's Property may be legal, depending on the
jurisdiction. In 2013, a jury in south Texas acquitted a man who killed a prostitute
who attempted to run away with his money.
Killing an Intruder who is found by an owner to be in the owner's home (having
entered unlawfully): legal in most US states (see Castle doctrine).
Killing to Prevent Specific Forms of Aggravated Rape or Sexual Assault –
killing of attacker by the potential victim or by witnesses to the scene; legal in
parts of the US and in various other countries.
In Pakistan, the killing of a woman or girl in specific circumstances (e.g., when
she commits adultery and is killed by her husband or other family members,
known as honor killing) is not considered murder.
In the United States, in some states and in federal jurisdiction, a killing by a
police officer is excluded from prosecution if the officer believes they are being
threatened with deadly force by the victim. This may include such actions by the
victim as reaching into a glove compartment or pocket for license and
registration, if the officer thinks that the victim might be reaching for a gun.
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Space jurisdiction is similar to that of international waters. Therefore, a murder
committed in outer space is subject to jurisdiction in the country that owns the
space craft in which the killing transpired. In the event the murder occurred on an
extraterrestrial planet (e.g. The Moon), no country can own land of any other
planet so the killer is bound by the laws of the country in which they originate.
This also applies to the ISS per agreement signed by all countries that have
worked on the station so all astronauts are covered by extraterritorial jurisdiction.
Victim
All jurisdictions require that the victim be a natural person; that is, a human being who
was still alive before being murdered. In other words, under the law one cannot murder
a corpse, a corporation, a non-human animal, or any other non-human organism such
as a plant or bacterium.
California's murder statute, Penal Code Section 187, was interpreted by the Supreme
Court of California in 1994 as not requiring any proof of the viability of the fetus as a
prerequisite to a murder conviction. This holding has two implications. The first is a
defendant in California can be convicted of murder for killing a fetus which the mother
herself could have terminated without committing a crime. The second, as stated by
Justice Stanley Mosk in his dissent, is that because women carrying nonviable fetuses
may not be visibly pregnant, it may be possible for a defendant to be convicted of
intentionally murdering a person they did not know existed.
Mitigating Circumstances
Some countries allow conditions that "affect the balance of the mind" to be regarded as
mitigating circumstances. This means that a person may be found guilty of
"manslaughter" on the basis of "diminished responsibility" rather than being found guilty
of murder, if it can be proved that the killer was suffering from a condition that affected
their judgment at the time. Depression, post-traumatic stress disorder and medication
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side-effects are examples of conditions that may be taken into account when assessing
responsibility.
Insanity
Mental disorder may apply to a wide range of disorders including psychosis caused by
schizophrenia and dementia, and excuse the person from the need to undergo the
stress of a trial as to liability. Usually, sociopathy and other personality disorders are not
legally considered insanity, because of the belief they are the result of free will in many
societies. In some jurisdictions, following the pre-trial hearing to determine the extent of
the disorder, the defense of "not guilty by reason of insanity" may be used to get a not
guilty verdict. This defense has two elements:
1. That the defendant had a serious mental illness, disease, or defect.
2. That the defendant's mental condition, at the time of the killing, rendered the
perpetrator unable to determine right from wrong, or that what they were doing
was wrong.
Under New York law, for example:
§ 40.15 Mental disease or defect. In any prosecution for an offense, it is an affirmative defense
that when the defendant engaged in the proscribed conduct, he lacked criminal responsibility by
reason of mental disease or defect. Such lack of criminal responsibility means that at the time of
such conduct, as a result of mental disease or defect, he lacked substantial capacity to know or
appreciate either: 1. The nature and consequences of such conduct; or 2. That such conduct was
wrong.
— N.Y. Penal Law, § 40.15
Under the French Penal Code:
Article 122-1
A person is not criminally liable who, when the act was committed, was suffering
from a psychological or neuropsychological disorder which destroyed his
discernment or his ability to control his actions.
A person who, at the time he acted, was suffering from a psychological or
neuropsychological disorder which reduced his discernment or impeded his
ability to control his actions, remains punishable; however, the court shall take
this into account when it decides the penalty and determines its regime.
Those who successfully argue a defense based on a mental disorder are usually
referred to mandatory clinical treatment until they are certified safe to be released back
into the community, rather than prison. A criminal defendant is often presented with the
option of pleading "not guilty by reason of insanity". Thus, a finding of insanity results in
a not-guilty verdict, although the defendant is placed in a state treatment facility where
they could be kept for years or even decades.
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Postpartum Depression
Postpartum depression (also known as post-natal depression) is recognized in some
countries as a mitigating factor in cases of infanticide. According to Dr. Susan
Friedman, "Two dozen nations have infanticide laws that decrease the penalty for
mothers who kill their children of up to one year of age. The United States does not
have such a law, but mentally ill mothers may plead not guilty by reason of insanity." In
the law of the Republic of Ireland, infanticide was made a separate crime from murder in
1949, applicable for the mother of a baby under one year old where "the balance of her
mind was disturbed by reason of her not having fully recovered from the effect of giving
birth to the child or by reason of the effect of lactation consequent upon the birth of the
child". Since independence, death sentences for murder in such cases had always been
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commuted; the new act was intended "to eliminate all the terrible ritual of the black cap
and the solemn words of the judge pronouncing sentence of death in those cases ...
where it is clear to the Court and to everybody, except perhaps the unfortunate
accused, that the sentence will never be carried out." In Russia, murder of a newborn
child by the mother has been separate crime since 1996.
Unintentional
For a killing to be considered murder in nine out of fifty states in the US, there normally
needs to be an element of intent. A defendant may argue that they took precautions not
to kill, that the death could not have been anticipated, or was unavoidable. As a general
rule, manslaughter constitutes reckless killing, but manslaughter also includes criminally
negligent (i.e. grossly negligent) homicide. Unintentional killing that results from an
involuntary action generally cannot constitute murder. After examining the evidence, a
judge or jury (depending on the jurisdiction) would determine whether the killing was
intentional or unintentional.
Diminished Capacity
In those jurisdictions using the Uniform Penal Code, such as California, diminished
capacity may be a defense. For example, Dan White used this defense to obtain a
manslaughter conviction, instead of murder, in the assassination of Mayor George
Moscone and Supervisor Harvey Milk. Afterward, California amended its penal code to
provide "As a matter of public policy there shall be no defense of diminished capacity,
diminished responsibility, or irresistible impulse in a criminal action...."
Aggravating Circumstances
Murder with specified aggravating circumstances is often punished more harshly.
Depending on the jurisdiction, such circumstances may include:
Premeditation
Poisoning
Murder of a child
Murder of a police officer, judge, firefighter or witness to a crime
Murder of a pregnant woman
Crime committed for pay or other reward, such as contract killing
Exceptional brutality or cruelty
Methods which are dangerous to the public, e.g. explosion, arson, shooting in a
crowd etc.
Murder for a political cause
Murder committed in order to conceal another crime or facilitate its commission.
Hate crimes, which occur when a perpetrator targets a victim because of their
perceived membership in a certain social group.
Treachery (e.g. Heimtücke in German law)
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In the United States and Canada, these murders are referred to as first-degree or
aggravated murders. Murder, under English criminal law, always carries a mandatory
life sentence, but is not classified into degrees. Penalties for murder committed under
aggravating circumstances are often higher, under English law, than the 15-year
minimum non-parole period that otherwise serves as a starting point for a murder
committed by an adult.
Felony Murder Rule
A legal doctrine in some common law jurisdictions broadens the crime of murder: when
an offender kills in the commission of a dangerous crime, (regardless of intent), he/she
is guilty of murder. The felony murder rule is often justified by its supporters as a means
of deterring dangerous felonies, but the case of Ryan Holle shows it can be used very
widely.
Year-And-A-Day Rule
In some common law jurisdictions, a defendant accused of murder is not guilty if the
victim survives for longer than one year and one day after the attack. This reflects the
likelihood that if the victim dies, other factors will have contributed to the cause of death,
breaking the chain of causation; and also means that the responsible person does not
have a charge of murder "hanging over their head indefinitely". Subject to any statute of
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limitations, the accused could still be charged with an offence reflecting the seriousness
of the initial assault.
With advances in modern medicine, most countries have abandoned a fixed time period
and test causation on the facts of the case. This is known as "delayed death" and cases
where this was applied or was attempted to be applied go back to at least 1966.
In England and Wales, the "year-and-a-day rule" was abolished by the Law Reform
(Year and a Day Rule) Act 1996. However, if death occurs three years or more after the
original attack then prosecution can take place only with the Attorney-General's
approval.
In the United States, many jurisdictions have abolished the rule as well. Abolition of the
rule has been accomplished by enactment of statutory criminal codes, which had the
effect of displacing the common-law definitions of crimes and corresponding defenses.
In 2001 the Supreme Court of the United States held that retroactive application of a
state supreme court decision abolishing the year-and-a-day rule did not violate the Ex
Post Facto Clause of Article I of the United States Constitution.
The potential effect of fully abolishing the rule can be seen in the case of 74-year-old
William Barnes, charged with the murder of a Philadelphia police officer Walter Barkley,
who he'd shot nearly 41 years before. Barnes had served 16 years in prison for
attempting to murder Barkley, but when the policeman died on August 19, 2007, this
was alleged to be from complications of the wounds suffered from the shooting - and
Barnes was charged with his murder. He was acquitted on May 24, 2010.
Murder and Natural Selection
Martin Daly and Margo Wilson of McMaster University have claimed that several
aspects of homicides, including the genetic relations or proximity between murderers
and their victims, (as in the Cinderella effect), can often be explained by the evolution
theory or evolutionary psychology.
Historical and Religious Attitudes
In the Abrahamic religions, the first ever murder was committed by Cain against his
brother Abel out of jealousy. In the past, certain types of homicide were lawful and
justified. Georg Oesterdiekhoff wrote:
Evans-Pritchard says about the Nuer from Sudan: "Homicide is not forbidden, and Nuer do not
think it wrong to kill a man in fair fight. On the contrary, a man who slays another in combat is
admired for his courage and skill." (Evans-Pritchard 1956: 195) This statement is true for most
African tribes, for pre-modern Europeans, for Indigenous Australians, and for Native Americans,
according to ethnographic reports from all over the world. ... Homicides rise to incredible numbers
among headhunter cultures such as the Papua. When a boy is born, the father has to kill a man.
He needs a name for his child and can receive it only by a man, he himself has murdered. When
a man wants to marry, he must kill a man. When a man dies, his family again has to kill a man.
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In many such societies the redress was not via a legal system, but by blood revenge,
although there might also be a form of payment that could be made instead—such as
the weregild which in early Germanic society could be paid to the victim's family in lieu
of their right of revenge.
One of the oldest-known prohibitions against murder appears in the Sumerian Code of
Ur-Nammu written sometime between 2100 and 2050 BC. The code states, "If a man
commits a murder, that man must be killed."
In Judeo-Christian traditions, the
prohibition against murder is one of
the Ten Commandments given by
God to Moses in (Exodus: 20v13)
and (Deuteronomy 5v17). The
Vulgate and subsequent early
English translations of the Bible
used the term secretly killeth his
neighbor or smiteth his neighbor
secretly rather than murder for the
Latin clam percusserit proximum.
Later editions such as Young's Literal Translation and the World English Bible have
translated the Latin occides simply as murder rather than the alternatives of kill,
assassinate, fall upon, or slay.
In Islam according to the Qur'an, one of the greatest sins is to kill a human being who
has committed no fault. "For that cause We decreed for the Children of Israel that
whosoever killeth a human being for other than manslaughter or corruption in the earth,
it shall be as if he had killed all mankind, and whoso saveth the life of one, it shall be as
if he had saved the life of all mankind." "And those who cry not unto any other god along
with Allah, nor take the life which Allah hath forbidden save in (course of) justice, nor
commit adultery – and whoso doeth this shall pay the penalty."
The term assassin derives from Hashshashin, a militant Ismaili Shi'ite sect, active from
the 8th to 14th centuries. This mystic secret society killed members of the Abbasid,
Fatimid, Seljuq and Crusader elite for political and religious reasons. The Thuggee cult
that plagued India was devoted to Kali, the goddess of death and destruction. According
to some estimates the Thuggees murdered 1 million people between 1740 and 1840.
The Aztecs believed that without regular offerings of blood the sun god Huitzilopochtli
would withdraw his support for them and destroy the world as they knew it. According to
Ross Hassig, author of Aztec Warfare, "between 10,000 and 80,400 persons" were
sacrificed in the 1487 re-consecration of the Great Pyramid of Tenochtitlan.
Southern slave codes did make willful killing of a slave illegal in most cases. For
example, the 1860 Mississippi case of Oliver v. State charged the defendant with
murdering his own slave. In 1811, the wealthy white planter Arthur Hodge was hanged
for murdering several of his slaves on his plantation in the British West Indies.
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In Corsica, vendetta was a social code that required Corsicans to kill anyone who
wronged their family honor. Between 1821 and 1852, no fewer than 4,300 murders were
perpetrated in Corsica.
Incidence
The World Health Organization reported in October 2002 that a person is murdered
every 60 seconds. An estimated 520,000 people were murdered in 2000 around the
globe. Another study estimated the worldwide murder rate at 456,300 in 2010 with a
35% increase since 1990. Two-fifths of them were young people between the ages of
10 and 29 who were killed by other young people. Because murder is the least likely
crime to go unreported, statistics of murder are seen as a bellwether of overall crime
rates.
Murder rates vary greatly among countries and societies around the world. In the
Western world, murder rates in most countries have declined significantly during the
20th century and are now between 1 and 4 cases per 100,000 people per year.
Murder Rates by Country
Murder rates in jurisdictions such as Japan, Singapore, Hong Kong, Iceland, Sweden,
Switzerland, Italy, Spain and Germany are among the lowest in the world, around 0.3–1
cases per 100,000 people per year; the rate of the United States is among the highest
of developed countries, around 4.5 in 2014, with rates in larger cities sometimes over 40
per 100,000. The top ten highest murder rates are in Honduras (91.6 per 100,000), El
Salvador, Ivory Coast, Venezuela, Belize, Jamaica, U.S. Virgin Islands, Guatemala,
Saint Kitts and Nevis and Zambia. (UNODC, 2011 – full table here).
The following absolute murder counts per-country are not comparable because they are
not adjusted by each country's total population. Nonetheless, they are included here for
reference, with 2010 used as the base year (they may or may not include justifiable
homicide, depending on the jurisdiction). There were 52,260 murders in Brazil,
consecutively elevating the record set in 2009. Over half a million people were shot to
death in Brazil between 1979 and 2003. 33,335 murder cases were registered across
India, about 19,000 murders committed in Russia, approximately 17,000 murders in
Colombia (the murder rate was 38 per 100,000 people, in 2008 murders went down to
15,000), approximately 16,000 murders in South Africa, approximately 15,000 murders
in the United States, approximately 26,000 murders in Mexico, approximately 13,000
murders in Venezuela, approximately 4,000 murders in El Salvador, approximately
1,400 murders in Jamaica, approximately 550 murders in Canada and approximately
470 murders in Trinidad and Tobago. Pakistan reported 12,580 murders.
In the United States, 666,160 people were killed between 1960 and 1996.
Approximately 90% of murders in the US are committed by males. Between 1976 and
2005, 23.5% of all murder victims and 64.8% of victims murdered by intimate partners
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were female. For women in the US, homicide is the leading cause of death in the
workplace.
In the US, murder is the leading cause of death for African American males aged 15 to
34. Between 1976 and 2008, African Americans were victims of 329,825 homicides. In
2006, Federal Bureau of Investigation's Supplementary Homicide Report indicated that
nearly half of the 14,990 murder victims that year were Black (7421). In the year 2007,
there were 3,221 black victims and 3,587 white victims of non-negligent homicides.
While 2,905 of the black victims were killed by a black offender, 2,918 of the white
victims were killed by white offenders. There were 566 white victims of black offenders
and 245 black victims of white offenders. The "white" category in the Uniform Crime
Reports (UCR) includes non-black Hispanics. In London in 2006, 75% of the victims of
gun crime and 79% of the suspects were "from the African/Caribbean community".
Murder demographics are affected by the improvement of trauma care, which has
resulted in reduced lethality of violent assaults – thus the murder rate may not
necessarily indicate the overall level of social violence.
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Workplace homicide, which tripled during the 1980s, is the fastest growing category of
murder in America.
Development of murder rates over time in different countries is often used by both
supporters and opponents of capital punishment and gun control. Using properly filtered
data, it is possible to make the case for or against either of these issues. For example,
one could look at murder rates in the United States from 1950 to 2000, and notice that
those rates went up sharply shortly after a moratorium on death sentences was
effectively imposed in the late 1960s. This fact has been used to argue that capital
punishment serves as a deterrent and, as such, it is morally justified. Capital
punishment opponents frequently counter that the United States has much higher
murder rates than Canada and most European Union countries, although all those
countries have abolished the death penalty. Overall, the global pattern is too complex,
and on average, the influence of both these factors may not be significant and could be
more social, economic, and cultural.
Despite the immense improvements in forensics in the past few decades, the fraction of
murders solved has decreased in the United States, from 90% in 1960 to 61% in 2007.
Solved murder rates in major U.S. cities varied in 2007 from 36% in Boston,
Massachusetts to 76% in San Jose, California. Major factors affecting the arrest rate
include witness cooperation [118] and the number of people assigned to investigate the
case.
History of Murder Rates
According to scholar Pieter Spierenburg homicide rates per 100,000 in Europe have
fallen over the centuries, from 35 per 100,000 in medieval times, to 20 in 1500 AD, 5 in
1700, to below two per 100,000 in 1900.
In the United States, murder rates have been higher and have fluctuated. They fell
below 2 per 100,000 by 1900, rose during the first half of the century, dropped in the
years following World War II, and bottomed out at 4.0 in 1957 before rising again. The
rate stayed in 9 to 10 range most of the period from 1972 to 1994, before falling to 5 in
present times. The increase since 1957 would have been even greater if not for the
significant improvements in medical techniques and emergency response times, which
mean that more and more attempted homicide victims survive. According to one
estimate, if the lethality levels of criminal assaults of 1964 still applied in 1993, the
country would have seen the murder rate of around 26 per 100,000, almost triple the
actually observed rate of 9.5 per 100,000.
A similar, but less pronounced pattern has been seen in major European countries as
well. The murder rate in the United Kingdom fell to 1 per 100,000 by the beginning of
the 20th century and as low as 0.62 per 100,000 in 1960, and was at 1.28 per 100,000
as of 2009. The murder rate in France (excluding Corsica) bottomed out after World
War II at less than 0.4 per 100,000, quadrupling to 1.6 per 100,000 since then.
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The specific factors driving this dynamics in murder rates are complex and not
universally agreed upon. Much of the raise in the U.S. murder rate during the first half of
the 20th century is generally thought to be attributed to gang violence associated with
Prohibition. Since most murders are committed by young males, the near simultaneous
low in the murder rates of major developed countries circa 1960 can be attributed to low
birth rates during the Great Depression and World War II. Causes of further moves are
more controversial. Some of the more exotic factors claimed to affect murder rates
include the availability of abortion and the likelihood of chronic exposure to lead during
childhood (due to the use of leaded paint in houses and tetraethyllead as a gasoline
additive in internal combustion engines).
Use of The Term
In many countries, in news reports,
journalists are typically careful not to call a
killing a murder until the perpetrator is
convicted of such. After arrest, journalists
write that the person was "arrested on
suspicion of murder". When a prosecutor
files charges, the accused is referred to as
an "accused murderer".
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XV. Prostitution
Prostitution is the business or practice of engaging in sexual activity in exchange for
payment. Prostitution is sometimes described as sexual services, commercial sex or,
colloquially, hooking. It is sometimes referred to euphemistically as "the world's oldest
profession" in the English-speaking world. A person who works in this field is called a
prostitute, and is a type of sex worker.
Prostitution occurs in a variety of forms, and its legal status varies from country to
country (sometimes from region to region within a given country), ranging from being
permissible but unregulated, to an enforced or unenforced crime, or a regulated
profession. It is one branch of the sex industry, along with pornography, stripping, and
erotic dancing. Brothels are establishments specifically dedicated to prostitution. In
escort prostitution, the act may take place at the client's residence or hotel room
(referred to as out-call), or at the escort's residence or a hotel room rented for the
occasion by the escort (in-call). Another form is street prostitution. Although the majority
of prostitutes are female and have male clients, a prostitute can be, and have clients of,
any gender or sexual orientation.
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There are about 42 million prostitutes in the world, living all over the world (though most
of Central Asia, the Middle East and Africa lacks data, studied countries in that large
region rank as top sex tourism destinations). Estimates place the annual revenue
generated by prostitution worldwide to be over $100 billion.
Some view prostitution as a form of exploitation of or violence against women, and
children, that helps to create a supply of victims for human trafficking. Some critics of
prostitution as an institution are supporters of the Swedish approach, which
decriminalizes the act of selling sex, but makes the purchase of sex illegal. This
approach has also been adopted by Canada, Iceland, the Republic of Ireland, Northern
Ireland, Norway, and France.
Etymology and terminology
Prostitute is derived from the Latin prostituta. Some sources cite the verb as a
composition of "pro" meaning "up front" or "forward" and "stituere", defined as "to offer
up for sale". Another explanation is that prostituta is a composition of pro and statuere
(to cause to stand, to station, place erect). A literal translation therefore is: "to put up
front for sale" or "to place forward". The Online Etymology Dictionary states, "The notion
of 'sex for hire' is not inherent in the etymology, which rather suggests one 'exposed to
lust' or sex 'indiscriminately offered.'"
The word prostitute was then carried down through various languages to the presentday
Western society. Most sex worker activists groups reject the word prostitute and
since the late 1970s have used the term sex worker instead. However, sex worker can
also mean anyone who works within the sex industry or whose work is of a sexual
nature and is not limited solely to prostitutes.
A variety of terms are used for those who engage in prostitution, some of which
distinguish between different types of prostitution or imply a value judgment about them.
Common alternatives for prostitute include escort and whore; however, not all
professional escorts are prostitutes.
The English word whore derives from the Old English word hōra, from the Proto-
Germanic *hōrōn (prostitute), which derives from the Proto-Indo-European root *keh₂meaning
"desire", a root which has also given us Latin cārus (dear), whence the French
cher (dear, expensive) and the Latin cāritās (love, charity). Use of the word whore is
widely considered pejorative, especially in its modern slang form of ho. In Germany,
however, most prostitutes' organizations deliberately use the word Hure (whore) since
they feel that prostitute is a bureaucratic term. Those seeking to remove the social
stigma associated with prostitution often promote terminology such as sex worker,
commercial sex worker (CSW) or sex trade worker. Another commonly used word for a
prostitute is hooker. Although a popular etymology connects "hooker" with Joseph
Hooker, a Union general in the American Civil War, the word more likely comes from the
concentration of prostitutes around the shipyards and ferry terminal of the Corlear's
Hook area of Manhattan in the 1820s, who came to be referred to as "hookers". A
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streetwalker solicits customers on the streets or in public places, while a call girl makes
appointments by phone, or in recent years, through email or the internet.
Correctly or not, use of the word prostitute without specifying a sex may commonly be
assumed to be female; compound terms such as male prostitution or male escort are
therefore often used to identify males. Those offering services to female customers are
commonly known as gigolos; those offering services to male customers are hustlers or
rent boys.
Procuring
Organizers of prostitution may be known as pimps (if male) and madams or Mama-san
(if female). More formally, one who is said to practice procuring is a procurer, or
procuress.
Clients
Clients of prostitutes, most often men by prevalence, are sometimes known as johns or
tricks in North America and punters in the British Isles. These slang terms are used
among both prostitutes and law enforcement for persons who solicit prostitutes. The
term john may have originated from the frequent customer practice of giving one's name
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as "John", a common name in English-speaking countries, in an effort to maintain
anonymity. In some places, men who drive around red-light districts for the purpose of
soliciting prostitutes are also known as kerb crawlers.
Female clients of prostitutes are sometimes referred to as janes or sugar mamas.
Other Meanings
The word "prostitution" can also be used metaphorically to mean debasing oneself or
working towards an unworthy cause or "selling out". In this sense, "prostituting oneself"
or "whoring oneself" the services or acts performed are typically not sexual. For
instance, in the book The Catcher in the Rye, Holden Caulfield says of his brother
("D.B."): "Now he's out in Hollywood, D.B., being a prostitute. If there's one thing I hate,
it's the movies. Don't even mention them to me." D.B. is not literally a prostitute; Holden
feels that his job writing B-movie screenplays is morally debasing.
The prostitution metaphor, "traditionally used to signify political inconstancy,
unreliability, fickleness, a lack of firm values and integrity, and venality, has long been a
staple of Russian political rhetoric." One of the famous insults of Leon Trotsky made by
Vladimir Lenin was calling him a "political prostitute". Leon Trotsky used this epithet
himself, calling German Social Democracy, at that time "corrupted by Kautskianism", a
"political prostitution disguised by theories".
In 1938, he used the same description for the Comintern, saying that the chief aim of
the Bonapartist clique of Stalin during the preceding several years "has consisted in
proving to the imperialist 'democracies' its wise conservatism and love for order. For the
sake of the longed alliance with imperialist democracies [Stalin] has brought the
Comintern to the last stages of political prostitution."
Besides targeting political figures, the term is used in relation to organizations and even
small countries, which "have no choice but to sell themselves", because their voice in
world affairs is insignificant. In 2007, a Russian caricature depicted the Baltic states as
three "ladies of the night", "vying for the attentions of Uncle Sam, since the Russian
client has run out of money".
Usage of the "political prostitute" moniker is by no means unique to Russian political
lexicon, such as when a Huffington Post contributor expressed the opinion that Donald
Trump was "prostituting himself to feed his ego and gain power" when he ran for
President of the United States.
Sex work researcher and writer Gail Pheterson writes that these metaphorical usages
exist because "the term "prostitute" gradually took on a Christian moralist tradition, as
being synonymous with debasement of oneself or of others for the purpose of ill-gotten
gains".
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History
Ancient Near East
In the Ancient Near East along the Tigris–Euphrates river system there were many
shrines and temples or "houses of heaven" dedicated to various deities documented by
the Ancient Greek historian Herodotus in The Histories where sacred prostitution was a
common practice. It came to an end when the emperor Constantine in the fourth century
AD destroyed the goddess temples and replaced them with Christianity.
As early as the 18th century BC, ancient Mesopotamia recognized the need to protect
women's property rights. In the Code of Hammurabi, provisions were found that
addressed inheritance rights of women, including female prostitutes.
Ancient Hebrew Culture
According to Zohar and the Alphabet of Ben Sira, there were four angels of sacred
prostitution, who mated with archangel Samael. They were the queens of the demons
Lilith, Naamah, Agrat Bat Mahlat and Eisheth Zenunim.
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Ancient Greece
Both women and boys engaged in prostitution in ancient Greece. Female prostitutes
could be independent and sometimes influential women. They were required to wear
distinctive dresses and had to pay taxes. Some similarities have been found between
the Greek hetaera, the Japanese oiran, and also the Indian tawaif. Some prostitutes in
ancient Greece, such as Lais were as famous for their company as their beauty, and
some of these women charged extraordinary sums for their services.
Ancient Rome
Prostitution in ancient Rome was legal, public, and widespread. A registered prostitute
was called a meretrix while the unregistered one fell under the broad category
prostibulae. There were some commonalities with the Greek system, but as the Empire
grew, prostitutes were often foreign slaves, captured, purchased, or raised for that
purpose, sometimes by large-scale "prostitute farmers" who took abandoned children.
Indeed, abandoned children were almost always raised as prostitutes. Enslavement into
prostitution was sometimes used as a legal punishment against criminal free women.
Buyers were allowed to inspect naked men and women for sale in private and there was
no stigma attached to the purchase of males by a male aristocrat.
Asia
According to Shia Muslims, Muhammad sanctioned fixed-term marriage—muta'a in Iraq
and sigheh in Iran—which has instead been used as a legitimizing cover for sex
workers, in a culture where prostitution is otherwise forbidden. Sunni Muslims, who
make up the majority of Muslims worldwide, believe the practice of fixed-term marriage
was abrogated and ultimately forbidden by either Muhammad, or one of his successors,
Umar. Sunnis regard prostitution as sinful and forbidden.
In the early 17th century, there was widespread male and female prostitution throughout
the cities of Kyoto, Edo, and Osaka, Japan. Oiran were courtesans in Japan during the
Edo period. The oiran were considered a type of yūjo ( 遊 女 ) "woman of pleasure" or
prostitute. Among the oiran, the tayū ( 太 夫 ) was considered the highest rank of
courtesan available only to the wealthiest and highest ranking men. To entertain their
clients, oiran practiced the arts of dance, music, poetry, and calligraphy as well as
sexual services, and an educated wit was considered essential for sophisticated
conversation. Many became celebrities of their times outside the pleasure districts.
Their art and fashions often set trends among wealthy women. The last recorded oiran
was in 1761. Although illegal in modern Japan, the definition of prostitution does not
extend to a "private agreement" reached between a woman and a man in a brothel.
Yoshiwara has a large number of soaplands that began when explicit prostitution in
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Japan became illegal, where women washed men's bodies. They were originally known
as toruko-buro, meaning Turkish bath.
A tawaif was a courtesan who catered to the nobility of the Indian subcontinent,
particularly during the era of the Mughal Empire. These courtesans danced, sang,
recited poetry and entertained their suitors at mehfils. Like the geisha tradition in Japan,
their main purpose was to professionally entertain their guests, and while sex was often
incidental, it was not assured contractually. High-class or the most popular tawaifs could
often pick and choose between the best of their suitors. They contributed to music,
dance, theatre, film, and the Urdu literary tradition.
Middle Ages
Throughout the Middle Ages the
definition of a prostitute has been
ambiguous, with various secular
and canonical organizations
defining prostitution in constantly evolving terms. Even though medieval secular
authorities created legislation to deal with the phenomenon of prostitution, they rarely
attempted to define what a prostitute was because it was deemed unnecessary "to
specify exactly who fell into that [specific] category" of a prostitute. The first known
definition of prostitution was found in Marseille's thirteenth-century statutes, which
included a chapter entitled De meretricibus ("regarding prostitutes"). The Marseillais
designated prostitutes as "public girls" who, day and night, received two or more men in
their house, and as a woman who "did business trading [their bodies], within the
confine[s] of a brothel." A fourteenth-century English tract, Fasciculus Morum, states
that the term prostitute (termed 'meretrix' in this document), "must be applied only to
those women who give themselves to anyone and will refuse none, and that for
monetary gain". In general prostitution was not typically a life-time career choice for
women. Women usually alternated their career of prostitution with "petty retailing, and
victualing," or only occasionally turning to prostitution in times of great financial need.
Women who became prostitutes often did not have the familial ties or means to protect
themselves from the lure of prostitution, and it has been recorded on several occasions
that mothers would be charged with prostituting their own daughters in exchange for
extra money. Medieval civilians accepted without question the fact of prostitution, it was
necessary part of medieval life. Prostitutes subverted the sexual tendencies of male
youth, just by existing. With the establishment of prostitution men were less likely to
collectively rape honest women of marriageable and re-marriageable age. This is most
clearly demonstrated in St. Augustine's claim that "the removal of the institution would
bring lust into all aspects of the world." Meaning that without prostitutes to subvert male
tendencies, men would go after innocent women instead, thus the prostitutes were
actually doing society a favor.
In urban societies there was an erroneous view that prostitution was flourishing more in
rural regions rather than in cities, however it has been proven that prostitution was more
rampant in cities and large towns. Although there were wandering prostitutes in rural
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areas who worked according to the calendar of fairs, similar to riding a circuit, in which
prostitutes stopped by various towns based on what event was going on at the time,
most prostitutes remained in cities. Cities tended to draw more prostitutes due to the
sheer size of the population and the institutionalization of prostitution in urban areas
which made it more rampant in metropolitan regions. Furthermore, in both urban and
rural areas of society, women who did not live under the rule of male authority were
more likely to be suspected of prostitution than their oppressed counterparts because of
the fear of women who did not fit into a stereotypical category outside of marriage or
religious life. Secular law, like most other aspects of prostitution in the Middle Ages, is
difficult to generalize due to the regional variations in attitudes towards prostitution. The
global trend of the thirteenth century was toward the development of positive policy on
prostitution as laws exiling prostitutes changed towards sumptuary laws and the
confinement of prostitutes to red light districts.
Sumptuary laws became the regulatory norm for prostitutes and included making
courtesans "wear a shoulder-knot of a particular color as a badge of their calling" to be
able to easily distinguish the prostitute from a respectable woman in society. The color
that designated them as prostitutes could vary from different earth tones to yellow, as
was usually designated as a color of shame in the Hebrew communities. These laws,
however, proved no impediment to wealthier prostitutes because their glamorous
appearances were almost indistinguishable from noble women. In the 14th century,
London prostitutes were only tolerated when they wore yellow hoods.
Although brothels were still present in most cities and urban centers, and could range
from private bordelages run by a procuress from her home to public baths and centers
established by municipal legislation, the only centers for prostitution legally allowed
were the institutionalized and publicly funded brothels. However this did not prevent
illegal brothels from thriving. Furthermore, brothels theoretically banned the patronage
of married men and clergy also, but it was sporadically enforced and there is evidence
of clergymen present in brawls that were documented in brothels. Thus the clergy were
at least present in brothels at some point or another. Brothels also settled the
"obsessive fear of the sharing of women" and solved the issue of "collective security."
The lives of prostitutes in brothels were not cloistered like that of nuns and "only some
lived permanently in the streets assigned to them." Prostitutes were only allowed to
practice their trade in the brothel in which they worked. Brothels were also used to
protect prostitutes and their clients through various regulations. For example, the law
that "forbid brothel keepers [from] beat[ing] them." However, brothel regulations also
hindered prostitutes' lives by forbidding them from having "lovers other than their
customers" or from having a favored customer.
Courts showed the conflicting views on the role of prostitutes in secular law as
prostitutes could not inherit property, defend themselves in court, or make accusations
in court. However, prostitutes were sometimes called upon as witnesses during trial.
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16th–17th Centuries
By the end of the 15th century attitudes seemed to have begun to harden against
prostitution. An outbreak of syphilis in Naples 1494 which later swept across Europe,
and which may have originated from the Columbian Exchange, and the prevalence of
other sexually transmitted diseases from the earlier 13th century, may have been
causes of this change in attitude. By the early 16th century the association between
prostitutes, plague, and contagion emerged, causing brothels and prostitution to be
outlawed by secular authority. Furthermore, outlawing brothel-keeping and prostitution
was also used to "strengthen the criminal law" system of the sixteenth-century secular
rulers. Canon law defined a prostitute as "a promiscuous woman, regardless of financial
elements." The prostitute was considered a "whore … who [was] available for the lust of
many men," and was most closely associated with promiscuity.
The Church's stance on prostitution
was three-fold: “acceptance of
prostitution as an inevitable social
fact, condemnation of those profiting
from this commerce, and
encouragement for the prostitute to
repent." The Church was forced to
recognize its inability to remove
prostitution from the worldly society,
and in the fourteenth century "began
to tolerate prostitution as a lesser
evil." However, prostitutes were to be excluded from the Church as long as they
practiced.
Around the twelfth century, the idea of prostitute saints took hold, with Mary Magdalene
being one of the most popular saints of the era. The Church used Mary Magdalene's
biblical history of being a reformed harlot to encourage prostitutes to repent and mend
their ways. Simultaneously, religious houses were established with the purpose of
providing asylum and encouraging the reformation of prostitution. 'Magdalene Homes'
were particularly popular and peaked especially in the early fourteenth century. Over the
course of the Middle Ages, popes and religious communities made various attempts to
remove prostitution or reform prostitutes, with varying success.
With the advent of the Protestant Reformation, numbers of Southern German towns
closed their brothels in an attempt to eradicate prostitution. In some periods prostitutes
had to distinguish themselves by particular signs, sometimes wearing very short hair or
no hair at all, or wearing veils in societies where other women did not wear them.
Ancient codes regulated in this case the crime of a prostitute that dissimulated her
profession. In some cultures, prostitutes were the sole women allowed to sing in public
or act in theatrical performances.
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18th Century
According to Dervish Ismail Agha, in the Dellâkname-i Dilküşâ, the Ottoman archives, in
the Turkish baths, the masseurs were traditionally young men, who helped wash clients
by soaping and scrubbing their bodies. They also worked as sex workers. The Ottoman
texts describe who they were, their prices, how many times they could bring their
customers to orgasm, and the details of their sexual practices.
During the British East India Company's rule in India in the late 18th and early 19th
centuries, it was initially fairly common for British soldiers to engage in inter-ethnic
prostitution in India, where they frequently visited local Indian nautch dancers. As British
females began arriving in British India in large numbers from the early to mid-19th
century, it became increasingly uncommon for British soldiers to visit Indian prostitutes,
and miscegenation was despised altogether after the events of the Indian Rebellion of
1857.
19th Century
In the 19th century, legalized prostitution became a public controversy as France and
then the United Kingdom passed the Contagious Diseases Acts, legislation mandating
pelvic examinations for suspected prostitutes. This legislation applied not only to the
United Kingdom and France, but also to their overseas colonies. France, instead of
trying to outlaw prostitution began to view prostitution as an evil necessary for society to
function. France chose to regulate prostitution, introducing a Morals Brigade onto the
streets of Paris. A similar situation did in fact exist in the Russian Empire; prostitutes
operating out of government-sanctioned brothels were given yellow internal passports
signifying their status and were subjected to weekly physical exams. A major work,
Prostitution, Considered in Its Moral, Social, and Sanitary Aspects, was published by
William Acton in 1857, which estimated that the County of London had 80,000
prostitutes and that 1 house in 60 was serving as a brothel. Leo Tolstoy's novel
Resurrection describes legal prostitution in 19th-century Russia.
During this period, prostitution was also very prominent in the Barbary Coast, San
Francisco as the population was mainly men, due to the influx from the Gold Rush. One
of the more successful madams was Belle Cora, who inadvertently got involved in a
scandal involving her husband, Charles Cora, shooting US Marshal William H.
Richardson. This led to the rise of new statutes against prostitution, gambling and other
activities seen as "immoral".
20th century
The leading theorists of Communism opposed prostitution. Communist governments
often attempted to repress the practice immediately after obtaining power, although it
always persisted. In contemporary Communist countries, it remains illegal but is
nonetheless common. The economic decline brought about by the collapse of the
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Soviet Union led to increased prostitution in many current or former Communist
countries.
Originally, prostitution was widely legal in the United States. Prostitution was made
illegal in almost all states between 1910 and 1915 largely due to the influence of the
Woman's Christian Temperance Union. On the other hand, prostitution generated much
national revenue in South Korea, hence the military government encouraged prostitution
for the U.S. military.
In 1956, the United Kingdom introduced the Sexual Offences Act 1956. While this law
did not criminalize the act of prostitution in the United Kingdom itself, it prohibited such
activities as running a brothel.
Soliciting was made illegal by the Street Offences Act 1959. These laws were partly
repealed, and altered, by the Sexual Offences Act 2003 and the Policing and Crime Act
2009.
Beginning in the late 1980s, many states in the US increased the penalties for
prostitution in cases where the prostitute is knowingly HIV-positive. Penalties for felony
prostitution vary, with maximum sentences of typically 10 to 15 years in prison.
Sex tourism emerged in the late 20th century as a controversial aspect of Western
tourism and globalization.
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21st Century
In the 21st century, Afghans revived a method of prostituting young boys which is
referred to as "bacha bazi".
Since the break up of the Soviet Union, thousands of eastern European women end up
as prostitutes in China, Western Europe, Israel, and Turkey every year; some enter the
profession willingly, but many are tricked, coerced, or kidnapped, and often experience
captivity and violence. There are tens of thousands of women from eastern Europe and
Asia working as prostitutes in Dubai. Men from Saudi Arabia and the United Arab
Emirates form a large proportion of the customers.
India's devadasi girls are forced by their poor families to dedicate themselves to the
Hindu goddess Renuka. The BBC wrote in 2007 that devadasis are "sanctified
prostitutes".
Historically, and currently, church prostitutes exist, and the practice may be legal or
illegal, depending on the country, state or province.
Islam
According to Shia Muslims, Muhammad sanctioned Nikah mut‘ah (fixed-term marriage,
called muta'a in Iraq and sigheh in Iran) which has instead been used as a legitimizing
cover for sex workers, in a culture where prostitution is otherwise forbidden. Some
Western writers have argued that mut'ah approximates prostitution. and Nikah misyar
Julie Parshall writes that mut'ah is legalised prostitution which has been sanctioned by
the Twelver Shia authorities. She quotes the Oxford encyclopedia of modern Islamic
world to differentiate between marriage (nikah) and Mut'ah, and states that while nikah
is for procreation, mut'ah is just for sexual gratification. According to Zeyno Baran, this
kind of temporary marriage provides Shi'ite men with a religiously sanctioned equivalent
to prostitution. According to Elena Andreeva's observation published in 2007, Russian
travellers to Iran consider mut'ah to be "legalized profligacy" which is indistinguishable
from prostitution. Religious supporters of mut'ah argue that temporary marriage is
different from prostitution for a couple of reasons, including the necessity of iddah in
case the couple have sexual intercourse. It means that if a woman marries a man in this
way and has sex, she has to wait for a number of months before marrying again and
therefore, a woman cannot marry more than 3 or 4 times in a year.
Payments and Salaries
Prostitutes' salaries and payments fluctuate according to the economic conditions of
their respective countries. Prostitutes who usually have foreign clients, such as
business travelers, depend on good foreign economic conditions. Payment may vary
according to regulations made by pimps, brothel keepers, madams, and procurers, who
usually take a slice out of a prostitute's income. Prices may further depend on demand;
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popular, high-end prostitutes can earn significant amounts of money (upwards of $5,000
per client), and virgins may receive even higher payments.
Attitudes
Laws
Roughly speaking, the possible attitudes are:
"Prostitution should be tolerated by society":
o
Decriminalization: "prostitution is labor like any other. Sex industry
premises should not be subject to any special regulation or laws", the
current situation in New Zealand; the laws against operating a brothel,
pimping and street prostitution are struck down, but prostitution is hardly
regulated at all. Proponents of this view often cite instances of government
regulation under legalization that they consider intrusive, demeaning, or
violent, but feel that criminalization adversely affects sex workers.
Amnesty International is one of the notable groups calling for the
decriminalization of prostitution.
o
Regulation: prostitution may be considered a legitimate business;
prostitution and the employment of prostitutes are legal, but regulated; the
current situation in the Netherlands, Germany, most of Australia and parts
of Nevada (see Prostitution in Nevada). The degree of regulation varies
very much; for example, in the Netherlands, prostitutes are not required to
undergo mandatory health checks (see Prostitution in the Netherlands),
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while in Nevada, the regulations are very strict (see Prostitution in
Nevada)
"Prostitution should not be tolerated":
o
o
o
Abolitionism (prostitution itself is not prohibited, but most associated
activities are illegal, in an attempt to make it more difficult to engage in
prostitution, prostitution is heavily discouraged and seen as a social
problem): prostitution (the exchange of sexual services for money) is legal,
but the surrounding activities such as public solicitation, operating a
brothel and other forms of pimping are prohibited, the current situation in
Great Britain and Italy among others;
Neo-Abolitionism ("prostitution is a form of violence against women, it is
a violation of human rights, the clients of the prostitutes exploit the
prostitutes"): prostitutes are not prosecuted, but their clients and pimps
are, which is the current situation in Sweden, France, Norway and Iceland
(in Norway the law is even more strict, forbidding also having sex with a
prostitute abroad).
Prohibitionism (both prostitutes and clients are criminalized and are seen
as immoral, they are considered criminals): the prevailing attitude nearly
everywhere in the United States, with a few exceptions in some rural
Nevada counties (see Prostitution in Nevada)
In some countries, there is controversy regarding the laws applicable to sex work. For
instance, the legal stance of punishing pimping while keeping sex work legal but
"underground" and risky is often denounced as hypocritical; opponents suggest either
going the full abolition route and criminalize clients or making sex work a regulated
business.
Many countries have sex worker advocacy groups which lobby against criminalization
and discrimination of prostitutes. These groups generally oppose Nevada-style
regulation and oversight, stating that prostitution should be treated like other
professions. In the United States of America, one such group is COYOTE (an
abbreviation for "Call Off Your Old Tired Ethics") and another is the North American
Task Force on Prostitution. In Australia the lead sex worker rights organization is
Scarlet Alliance. International prostitutes' rights organizations include the International
Committee for Prostitutes' Rights and the Network of Sex Work Projects.
Other groups, often with religious backgrounds, focus on offering women a way out of
the world of prostitution while not taking a position on the legal question.
Prostitution is a significant issue in feminist thought and activism. Many feminists are
opposed to prostitution, which they see as a form of exploitation of women and male
dominance over women, and as a practice which is the result of the existing patriarchal
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societal order. These feminists argue that prostitution has a very negative effect, both
on the prostitutes themselves and on society as a whole, as it reinforces stereotypical
views about women, who are seen as sex objects which can be used and abused by
men. Other feminists hold that prostitution can be a valid choice for the women who
choose to engage in it; in this view, prostitution must be differentiated from forced
prostitution, and feminists should support sex worker activism against abuses by both
the sex industry and the legal system.
In February 2014, the members of the European Parliament voted in a non-binding
resolution, (adopted by 343 votes to 139; with 105 abstentions), in favor of the 'Swedish
Model' of criminalizing the buying, but not the selling of sex.
Legality
The position of prostitution and the law varies widely worldwide, reflecting differing
opinions on victimhood and exploitation, inequality, gender roles, gender equality, ethics
and morality, freedom of choice, historical social norms, and social costs and benefits.
Legal themes tend to address four types of issue: victimhood (including potential
victimhood), ethics and morality, freedom of choice, and general benefit or harm to
society (including harm arising indirectly from matters connected to prostitution).
Prostitution may be considered a form of exploitation (e.g., Sweden, Norway, Iceland,
where it is illegal to buy sexual services, but not to sell them — the client commits a
crime, but not the prostitute), a legitimate occupation (e.g., Netherlands, Germany,
where prostitution is regulated as a profession) or a crime (e.g., many Muslim countries,
where the prostitutes face severe penalties).
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The legal status of prostitution varies from country to country, from being legal and
considered a profession to being punishable by death. Some jurisdictions outlaw the act
of prostitution (the exchange of sexual services for money); other countries do not
prohibit prostitution itself, but ban the activities typically associated with it (soliciting in a
public place, operating a brothel, pimping etc.), making it difficult to engage in
prostitution without breaking any law; and in a few countries prostitution is legal and
regulated.
In 1949, the UN General Assembly adopted a convention stating that "prostitution and
the accompanying evil of the traffic in persons for the purpose of prostitution are
incompatible with the dignity and worth of the human person", requiring all signing
parties to punish pimps and brothel owners and operators and to abolish all special
treatment or registration of prostitutes. As of January 2009, the convention was ratified
by 95 member nations including France, Spain, Italy, Denmark, and not ratified by
another 97 member nations including Germany, the Netherlands, the United Kingdom
and the United States.
Advertising
In countries where prostitution is legal, advertising it may be legal (as in the
Netherlands) or illegal (as in India). Covert advertising for prostitution can take a
number of forms:
by cards in newsagents' windows
by cards placed in public telephone enclosures: so-called tart cards
by euphemistic advertisements in regular magazines and newspapers (for
instance, talking of "massages" or "relaxation")
in specialist contact magazines
via the Internet
In the United States, massage parlors serving as a cover for prostitution may advertise
"full service", a euphemism for coitus.
In Las Vegas, prostitution is often promoted overtly on the Las Vegas Strip by third party
workers distributing risque flyers with the pictures and phone numbers of escorts
(despite the fact that prostitution is illegal in Las Vegas and Clark County, see
Prostitution in Nevada).
The way in which prostitutes advertise their presence varies widely. Some remain in
apartments which have hints or clues outside such as posters with "model" written on
them to lure potential customers inside. Others advertise by putting numbers or location
in phoneboxes or in online or newspaper ads. In more sexually permissive societies,
prostitutes can advertise in public view, such as through display windows. In sexually
restrictive societies it may occur through word-of-mouth and other means.
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Socio-Economic Issues
Illegal Immigration
A difficulty facing migrant prostitutes in many developed countries is the illegal
residence status of some of these women. They face potential deportation, and so do
not have recourse to the law. Hence there are brothels that may not adhere to the usual
legal standards intended to safeguard public health and the safety of the workers.
The immigration status of the persons who sell sexual services is – particularly in
Western Europe – a controversial and highly debated political issue. Currently, in most
of these countries most prostitutes are immigrants, mainly from Eastern and Central
Europe; in Spain and Italy 90% of prostitutes are estimated to be migrants, in Austria
78%, in Switzerland 75%, in Greece 73%, in Norway 70% (according to a 2009
TAMPEP report, Sex Work in Europe-A mapping of the prostitution scene in 25
European countries). An article in Le Monde diplomatique in 1997 stated that 80% of
prostitutes in Amsterdam were foreigners and 70% had no immigration papers.
Survival Sex
Survival sex is when the prostitute is driven to prostitution by a need for basic
necessities such as food or shelter. This type of prostitution is common among the
homeless and in refugee camps. The term is used in the sex trade and by aid workers,
although some practitioners do not regard the act as exploitative.
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Use of Children
Regarding the prostitution of children the laws on prostitution as well as those on sex
with a child apply. If prostitution in general is legal there is usually a minimum age
requirement for legal prostitution that is higher than the general age of consent (see
above for some examples). Although some countries do not single out patronage of
child prostitution as a separate crime, the same act is punishable as sex with an
underage person.
In India, the federal police say that around 1.2 million children are believed to be
involved in prostitution. A CBI statement said that studies and surveys sponsored by the
ministry of women and child development estimated that about 40% of all India's
prostitutes are children.
In Bangladesh, child prostitutes are known to take the drug Oradexon, also known as
dexamethasone. This over-the-counter steroid, usually used by farmers to fatten cattle,
makes child prostitutes look larger and older. Charities say that 90% of prostitutes in the
country's legalized brothels use the drug. According to social activists, the steroid can
cause diabetes, high blood pressure and is highly addictive.
Thailand's Health System Research Institute reported that children in prostitution make
up 40% of prostitutes in Thailand.
Some adults travel to other countries to have access to sex with children, which is
unavailable in their home country. Cambodia has become a notorious destination for
sex with children. Thailand is also a destination for child sex tourism. Several western
countries have recently enacted laws with extraterritorial reach, punishing citizens who
engage in sex with minors in other countries. As the crime usually goes undiscovered,
these laws are rarely enforced.
Among the Elderly
Prostitution among the elderly is a phenomenon reported in South Korea where elderly
people turn to prostitution to pay their bills. This problem comes about because the
state does not provide enough income for necessities. Clients in Korea tend also to be
elderly.
Violence
Street prostitutes are at higher risk of violent crime than brothel prostitutes and bar
prostitutes.
In the United States, the homicide rate for female prostitutes was estimated to be 204
per 100,000. There are substantial differences in rates of victimization between street
prostitutes and indoor prostitutes who work as escorts, call girls, or in brothels and
massage parlors. Violence against male prostitutes is less common.
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Prostitution may sometimes be associated with illegal, abusive, and dangerous
activities. One view maintains that this results from prostitution being stigmatized or
illegal, or both. Another, however, believes that legalizing and regulating prostitution
does not improve the situation, but instead makes it worse, creating a parallel illegal
prostitution industry, and failing to dissociate the legal part of the sex trade from crime.
Human trafficking
Sex trafficking is defined as using coercion or force to transport an unwilling person into
prostitution or other sexual exploitation. The United Nations stated in 2009 that sex
trafficking is the most commonly identified form of human trafficking and estimates that
about 79% of human trafficking reported is for prostitution (although the study notes that
this may be the result of statistical bias and that sex trafficking tends to receive the most
attention and be the most visible). Sex trafficking has been described by Kul Gautum,
Deputy Executive Director of UNICEF, as "the largest slave trade in history." It is also
the fastest growing criminal industry, predicted to outgrow drug trafficking. While there
may be a higher number of people involved in slavery today than at any time in history,
the proportion of the population is probably the smallest in history.
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“Annually, according to U.S. Government-sponsored research completed in 2006,
approximately 800,000 people are trafficked across national borders, which does not
include millions trafficked within their own countries. Approximately 80 percent of
transnational victims are women and girls and up to 50 percent are minors," estimated
the US Department of State in a 2008 study, in reference to the number of people
estimated to be victims of all forms of human trafficking. Due in part to the illegal and
underground nature of sex trafficking, the actual extent of women and children forced
into prostitution is unknown. A statistical analysis of various measures of trafficking
found that the legal status of prostitution did not have a significant impact on trafficking.
Children are sold into the global sex trade every year. Often they are kidnapped or
orphaned, and sometimes they are sold by their own families. According to the
International Labor Organization, the occurrence is especially common in places such
as Thailand, the Philippines, Sri Lanka, Vietnam, Cambodia, Nepal and India.
Globally, forced labor generates an estimated $31 billion, about half of it in the
industrialized world and around one tenth in transitional countries, according to the
International Labor Organization in a report on forced labor ("A global alliance against
forced labor", ILO, 11 May 2005). Trafficking in people has been facilitated by factors
such as porous borders and advanced communication technologies, and has become
increasingly transnational in scope and highly financially lucrative.
The most common destinations for victims of human trafficking are Thailand, Japan,
Israel, Belgium, the Netherlands, Germany, Italy, Turkey and the US, according to a
report by the UNODC (UN Office on Drugs and Crime).
Major sources of trafficked persons include Thailand, China, Nigeria, Albania, Bulgaria,
Belarus, Moldova and Ukraine.
Illicit Uses
Prostitution, often when it is illegal, is used in extortion and blackmail, which always
involves extortion, where the extortionist threatens to reveal information about a victim
or their family members that is potentially embarrassing, socially damaging, or
incriminating unless a demand for money, property, or services is met.
The subject of the extortion may be manipulated into or voluntarily solicit the use of
prostitution which is then later used to extort money or for profit otherwise. The film The
Godfather Part II famously depicts the role of Senator Geary who is implicated in the
use of prostitution in order to gain his compliance on political issues.
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Types
Street
In street prostitution, the prostitute solicits customers while waiting at street corners,
sometimes called "the track" by pimps and prostitutes alike. They usually dress in
skimpy, provocative clothing, regardless of the weather. Street prostitutes are often
called "streetwalkers" while their customers are referred to as "tricks" or "johns."
Servicing the customers is described as "turning tricks." The sex is usually performed in
the customer's car, in a nearby alley, or in a rented room. Motels and hotels that
accommodate prostitutes commonly rent rooms by the half or full hour.
In Russia and other countries of the former USSR, prostitution takes the form of an
open-air market. One prostitute stands by a roadside, and directs cars to a so-called
"tochka" (usually located in alleyways or carparks), where lines of women are paraded
for customers in front of their car headlights. The client selects a prostitute, whom he
takes away in his car. Prevalent in the late 1990s, this type of service has been steadily
declining in recent years.
A "lot lizard" is a commonly encountered special case of street prostitution. Lot lizards
mainly serve those in the trucking industry at truck stops and stopping centers.
Prostitutes will often proposition truckers using a CB radio from a vehicle parked in the
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non-commercial section of a truck stop parking lot, communicating through codes based
on commercial driving slang, then join the driver in his truck.
Brothels
Brothels are establishments specifically dedicated to prostitution, often confined to
special red-light districts in big cities. Other names for brothels include bordello,
whorehouse, cathouse, knocking shop, and general houses. Prostitution also occurs in
some massage parlors, and in Asian countries in some barber shops where sexual
services may be offered as a secondary function of the premises.
Escorts
Escort services may be distinguished from prostitution or other forms of prostitution in
that sexual activities are often not explicitly advertised as necessarily included in these
services; rather, payment is often noted as being for an escort's time and
companionship only, although there is often an implicit assumption that sexual activities
are expected.
In escort prostitution, the act takes place at the customer's residence or hotel room
(referred to as out-call), or at the escort's residence or in a hotel room rented for the
occasion by the escort (called in-call). The prostitute may be independent or working
under the auspices of an escort agency. Services may be advertised over the Internet,
in regional publications, or in local telephone listings.
Use of the Internet by prostitutes and customers is common. A prostitute may use adult
boards or create a website of their own with contact details, such as email addresses.
Adult contact sites, chats and on-line communities are also used. This, in turn, has
brought increased scrutiny from law enforcement, public officials, and activist groups
toward online prostitution. In 2009, Craigslist came under fire for its role in facilitating
online prostitution, and was sued by some 40 US state attorneys general, local
prosecutors, and law enforcement officials.
Reviews of the services of individual prostitutes can often be found at various escort
review boards worldwide. These online forums are used to trade information between
potential clients, and also by prostitutes to advertise the various services available. Sex
workers, in turn, often use online forums of their own to exchange information on clients,
particularly to warn others about dangerous clients.
Sex Tourism
Sex tourism is travel for sexual intercourse with prostitutes or to engage in other sexual
activity. The World Tourism Organization, a specialized agency of the United Nations
defines sex tourism as "trips organized from within the tourism sector, or from outside
this sector but using its structures and networks, with the primary purpose of effecting a
commercial sexual relationship by the tourist with residents at the destination".
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As opposed to regular sex tourism, which is often legal, a tourist who has sex with a
child prostitute will usually be committing a crime in the host country, under the laws of
his own country (notwithstanding him being outside of it) and against international law.
Child sex tourism (CST) is defined as a travel to a foreign country for the purpose of
engaging in commercially facilitated child sexual abuse. Thailand, Cambodia, India,
Brazil, and Mexico have been identified as leading hotspots of child sexual exploitation.
Virtual Sex
Virtual sex, that is, sexual acts conveyed by messages rather than physically, is also the
subject of commercial transactions. Commercial phone sex services have been
available for decades. The advent of the Internet has made other forms of virtual sex
available for money, including computer-mediated cybersex, in which sexual services
are provided in text form by way of chat rooms or instant messaging, or audiovisually
through a webcam (see camgirl).
Prevalence
According to the paper "Estimating the prevalence and career longevity of prostitute
women", the number of full-time equivalent prostitutes in a typical area in the United
States (Colorado Springs, CO, during 1970–1988) is estimated at 23 per 100,000
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population (0.023%), of which some 4% were under 18. The length of these prostitutes'
working careers was estimated at a mean of 5 years. According to a 2012 report by
Fondation Scelles there are between 40 and 42 million prostitutes in the world.
In 2003, it was estimated that in Amsterdam, one woman in 35 was working as a
prostitute, compared to one in 300 in London.
The number of men who have used a prostitute at least once varies widely from country
to country, from an estimated low of between 7% and 8.8% in the United Kingdom, to a
high of between 59% and 80% in Cambodia. A study conducted by ProCon – a
nonpartisan nonprofit organization – estimated the percentage of men who had paid for
sex at least once in their lives, and found the highest rates in Cambodia (between 59
and 80% of men had paid for sex at least once) and Thailand (an estimated 75%),
followed by Italy (16.7–45%), Spain (27–39%), Japan (37%), the Netherlands (13.5–
21.6%), the United States (15.0–20.0%), and China (6.4-20%). Nations with higher
rates of prostitution clients, or “johns”, display much more positive attitudes towards
commercial sex. In some countries, such as Cambodia and Thailand, sex with
prostitutes is considered commonplace and men who do not engage in commercial sex
may be considered unusual by their peers. In Thailand, it has been reported that about
75% of men have visited a prostitute at least once in their lifetimes. In Cambodia, that
figure is 59% to 80%.
In the United States, a 2004 TNS poll reported 15% of all men admitted to having paid
for sex at least once in their life. However, a paper entitled "Prostitution and the sex
discrepancy in reported number of sexual partners" concluded that men's self-reporting
of prostitutes as sexual partners provides a serious underestimate.
In Australia, a survey conducted in the early 2000s showed that 15.6% of men aged 16–
59 reported paying for sex at least once in their life, and 1.9% had done so in the past
year.
Reports disagree on whether prostitution levels are growing or declining in developed
countries. Some studies indicate that the percentage of men engaging in commercial
sex in the United States has declined significantly in recent decades: in 1964, an
estimated 69–80% of men had paid for sex at least once. Some have suggested that
prostitution levels have fallen in sexually liberal countries, most likely because of the
increased availability of non-commercial, non-marital sex or, for example in Sweden,
because of stricter legal penalties. Other reports suggest a growth in prostitution levels,
for example in the US, where again, sexual liberalization is suggested as the cause. As
Norma Ramos, Executive Director of the Coalition Against Trafficking in Women says
"The more the commercial sex industry normalizes this behavior, the more of this
behavior you get".
Prostitutes have long plied their trades to the military in many cultures. For example, the
British naval port of Portsmouth had a flourishing local sex industry in the 19th century,
and until the early 1990s there were large red-light districts near American military
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ases in the Philippines. The notorious Patpong entertainment district in Bangkok,
Thailand, started as an R&R location for US troops serving in the Vietnam War in the
early 1970s. Washington D.C. itself had Murder Bay which attracted the military of the
Civil War. The village of Vadia, India is known locally as the village of prostitutes, where
unmarried women are involved in prostitution. Mass weddings for children of prostitutes
in the village are held to protect them from being pushed into prostitution.
Medical Situation
In some places, prostitution may be associated with the spread of sexually transmitted
diseases (STDs). Lack of condom use among prostitutes and their clients has been
cited as a factor in the spread of HIV in Asia: "One of the main reasons for the rapid
spread of HIV in Asian countries is the massive transmission among sex workers and
clients". As a result, prevention campaigns aimed at increasing condom use by sex
workers have been attributed to play a major role in restricting the spread of HIV.
One of the sources for the spread of HIV in Africa is prostitution, with one study finding
that encounters with prostitutes produced 84% of new HIV infections in adult males in
Accra, Ghana. The spread of HIV from urban settings to rural areas in Africa has been
attributed to the mobility of farmers who visit sex workers in cities, for example in
Ethiopia. Some studies of prostitution in urban settings in developing countries, such as
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Kenya, have stated that prostitution acts as a reservoir of STDs within the general
population.
Typical responses to the problem are:
banning prostitution completely
introducing a system of registration for prostitutes that mandates health checks
and other public health measures
educating prostitutes and their clients to encourage the use of barrier
contraception and greater interaction with health care
Some think that the first two measures are counter-productive. Banning prostitution
tends to drive it underground, making safe sex promotion, treatment and monitoring
more difficult. Registering prostitutes makes the state complicit in prostitution and does
not address the health risks of unregistered prostitutes. Both of the last two measures
can be viewed as harm reduction policies.
In countries and areas where safer sex precautions are either unavailable or not
practiced for cultural reasons, prostitution is an active disease vector for all STDs,
including HIV/AIDS, but the encouragement of safer sex practices, combined with
regular testing for sexually transmitted diseases, has been very successful when
applied consistently. As an example, Thailand's condom program has been largely
responsible for the country's progress against the HIV epidemic. It has been estimated
that successful implementation of safe sex practices in India "would drive the [HIV]
epidemic to extinction" while similar measures could achieve a 50% reduction in
Botswana. In 2009, UN Secretary-General Ban Ki-moon urged all countries to remove
bans on prostitution and homosexual sex, because "such laws constitute major barriers
to reaching key populations with HIV services". In 2012, the Global Commission on HIV
and the Law, which was convened by Ban Ki-moon, and which is an independent body,
established at the request of the UNAIDS, and supported by a Secretariat based at the
UNDP, reached the same conclusions, also recommending decriminalization of brothels
and procuring. Nevertheless, the report states that: "The content, analysis, opinions and
policy recommendations contained in this publication do not necessarily reflect the
views of the United Nations Development Program."
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XVI. Racketeering
A Racket is an organized criminal act, usually in which the criminal act is a form of
business or a way to earn illegal money regularly or briefly but repeatedly. A racket is
often a repeated or continuous criminal operation. Originally and often still specifically, a
racket was a criminal act in which the perpetrator or perpetrators fraudulently offer a
service to solve a nonexistent problem, a service that will not be put into effect, or a
service that would not exist without the racket. Conducting a racket is racketeering.
Particularly, the potential problem may be caused by the same party that offers to solve
it, but that fact may be concealed, with the specific intent to engender continual
patronage for this party.
The most common example of a racket is the "protection racket", which promises to
protect the target business or person from dangerous individuals in the neighborhood
and then either collects the money or causes damage to the business until the owner
pays. The racket exists as both the problem and its solution, and it is used as a method
of extortion.
However, the term "racket" has expanded in definition and may be used less strictly to
refer to any illegal organized crime operation, including those that do not necessarily
involve fraudulent practices. For example, "racket" may be used to refer to the "numbers
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acket" or the "drug racket", neither of which generally or explicitly involve fraud or
deception with regard to the intended clientele.
Racketeering is most often associated with organized crime, and the term was coined
by the Employers' Association of Chicago in June 1927 in a statement about the
influence of organized crime in the Teamsters union.
Examples
Examples of crimes that may be alleged to be part of a pattern of racketeering activity
include
A protection racket is a form of extortion whereby racketeers offer to "protect"
property from damage in exchange for a fee, while also being responsible, in part
or in whole, for the property damage.
A fencing racket is an operation specializing in the resale of stolen goods.
A numbers racket is any unauthorized lottery or illegal gambling operation.
Money laundering and other creative accounting practices that are misused in
ways to disguise sources of illegal funds.
Theft operations, including: burglary, home invasion, robbery, identity theft, auto
theft, art theft, car hijacking, truck hijacking, organized retail crime, shoplifting,
and copyright infringement (including the sale of counterfeit goods)
Fraud and embezzlement operations, including: credit card fraud, check fraud,
health care fraud, insurance fraud, mail and wire fraud, securities fraud, bank
fraud, mortgage fraud, skimming (fraud), electoral fraud, confidence tricks, and
bid rigging
Kidnapping
Murder and murder-for-hire
Bribery and police corruption
Organized academic dishonesty by school administrators
Loan sharking
Computer crimes
Drug trafficking
Arms trafficking
Extortion
Prostitution and commercial sexual exploitation of children
Human trafficking
People smuggling
Tax evasion and cigarette smuggling
Witness tampering and intimidation
Skimming (casinos)
Operating chop shops
Illegal gambling or bookmaking, including match fixing
Criminal operation of otherwise ostensibly legal operations, such as strip clubs,
casinos, and waste management firms
Poaching, overfishing, illegal logging, illegal construction, and illegal mining
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Dog fighting, cockfighting, and bullfighting
RICO Act
On October 15, 1970, the Racketeer Influenced and Corrupt Organizations Act (18
U.S.C. §§ 1961–1968), commonly referred to as the "RICO Act", became United States
law. The RICO Act allowed law enforcement to charge a person or group of people with
racketeering, defined as committing multiple violations of certain varieties within a tenyear
period. The purpose of the RICO Act was stated as "the elimination of the
infiltration of organized crime and racketeering into legitimate organizations operating in
interstate commerce". S.Rep. No. 617, 91st Cong., 1st Sess. 76 (1968). However, the
statute is sufficiently broad to encompass illegal activities relating to any enterprise
affecting interstate or foreign commerce.
Section 1961(10) of Title 18 provides that the Attorney General of the United States
may designate any department or agency to conduct investigations authorized by the
RICO statute and such department or agency may use the investigative provisions of
the statute or the investigative power of such department or agency otherwise conferred
by law. Absent a specific designation by the Attorney General, jurisdiction to conduct
investigations for violations of 18 U.S.C. § 1962 lies with the agency having jurisdiction
over the violations constituting the pattern of racketeering activity listed in 18 U.S.C. §
1961.
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In the US, civil racketeering laws are also used in federal and state courts.
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XVII. Terrorism
Terrorism is, in the broadest sense, the use of intentionally indiscriminate violence as a
means to create terror among masses of people; or fear to achieve a religious or
political aim. It is used in this regard primarily to refer to violence during peacetime or in
war against non-combatants. The terms "terrorist" and "terrorism" originated during the
French Revolution of the late 18th century but gained mainstream popularity in the
1970s in news reports and books covering the conflicts in Northern Ireland, the Basque
Country and Palestine. The increased use of suicide attacks from the 1980s onwards
was typified by the September 11 attacks in New York City and Washington, D.C. in
2001.
There is no commonly accepted definition of "terrorism". Terrorism is a charged term. It
is often used with the connotation of something that is "morally wrong". Governments
and non-state groups use the term to abuse or denounce opposing groups.
Varied political organizations have been accused of using terrorism to achieve their
objectives. These organizations include right-wing and left-wing political organizations,
nationalist groups, religious groups, revolutionaries and ruling governments. Legislation
declaring terrorism a crime has been adopted in many states. There is no consensus as
to whether or not terrorism should be regarded as a war crime.
The Global Terrorism Database, maintained by the University of Maryland, College
Park, has recorded more than 61,000 incidents of non-state terrorism, resulting in at
least 140,000 deaths between 2000 and 2014.
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Etymology
Etmologically, the word terror is derived from the Latin verb Tersere, which later
becomes Terrere. The latter form appears in European languages as early as the 12th
century; its first known use in French is the word terrible in 1160. By 1356 the word
terreur is in use. Terreur is the origin of the Middle English term terrour, which later
becomes the modern word "terror".
Historical Background
The term terroriste, meaning "terrorist", is first used in 1794 by the French philosopher
François-Noël Babeuf, who denounces Maximilien Robespierre's Jacobin regime as a
dictatorship. In the years leading up to the Reign of Terror, the Brunswick Manifesto
threatened Paris with an "exemplary, never to be forgotten vengeance: the city would be
subjected to military punishment and total destruction" if the royal family was harmed,
but this only increased the Revolution's will to abolish the monarchy. Some writers
attitudes about French Revolution grew less favorable after the French monarchy was
abolished in 1792. During the Reign of Terror, which began in July 1793 and lasted
thirteen months, Paris was governed by the Committee of Public safety who oversaw a
regime of mass executions and public purges.
Prior to the French Revolution, ancient philosophers wrote about tyrannicide, as tyranny
was seen as the greatest political threat to Greco-Roman civilization. Medieval
philosophers were similarly occupied with the concept of tyranny, though the analysis of
some theologians like Thomas Aquinas drew a distinction between usurpers, who could
be killed by anyone, and legitimate rulers who abused their power – the latter, in
Aquinas' view, could only be punished by a public authority. John of Salisbury was the
first medieval Christian scholar to defend tyrannicide.
Most scholars today trace the origins of the modern tactic of terrorism to the Jewish
Sicarii Zealots who attacked Romans and Jews in 1st century Palestine. They follow its
development from the Persian Order of Assassins through to 19th-century anarchists.
The "Reign of Terror" is usually regarded as an issue of etymology. The term terrorism
has generally been used to describe violence by non-state actors rather than
government violence since the 19th-century Anarchist Movement.
In December 1795, Edmund Burke used the word "Terrorists" in a description of the
new French government called 'Directory':
At length, after a terrible struggle, the [Directory] Troops prevailed over the Citizens (…)
To secure them further, they have a strong corps of irregulars, ready armed. Thousands
of those Hell-hounds called Terrorists, whom they had shut up in Prison on their last
Revolution, as the Satellites of Tyranny, are let loose on the people. (emphasis added)
The terms "terrorism" and "terrorist" gained renewed currency in the 1970s as a result of
the Israeli–Palestinian conflict, the Northern Ireland conflict, the Basque conflict, and the
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operations of groups such as the Red Army Faction. Leila Khaled was described as a
terrorist in a 1970 number of Life magazine. A number of books on terrorism were
published in the 1970s. The topic came further to the fore after the 1983 Beirut barracks
bombings and again after the 2001 September 11 attacks and the 2002 Bali bombings.
Modern Definitions
There are over 109 different definitions of terrorism. American political philosopher
Michael Walzer in 2002 wrote: "Terrorism is the deliberate killing of innocent people, at
random, to spread fear through a whole population and force the hand of its political
leaders". [5] Bruce Hoffman, an American scholar, has noted that:
It is not only individual agencies within the same governmental apparatus that cannot agree on a
single definition of terrorism. Experts and other long-established scholars in the field are equally
incapable of reaching a consensus.
C.A.J. Coady has written that the question of how to define terrorism is "irresolvable"
because "its natural home is in polemical, ideological and propagandist contexts".
French historian Sophie Wahnich distinguishes between the revolutionary terror of the
French Revolution and the terrorists of the September 11 attacks:
Revolutionary terror is not terrorism. To make a moral equivalence between the
Revolution's year II and September 2001 is historical and philosophical nonsense ...
The violence exercised on 11 September 2001 aimed neither at equality nor liberty. Nor
did the preventive war announced by the president of the United States.
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Experts disagree about "whether terrorism is wrong by definition or just wrong as a
matter of fact; they disagree about whether terrorism should be defined in terms of its
aims, or its methods, or both, or neither; they disagree about whether or not states can
perpetrate terrorism; they even disagree about the importance or otherwise of terror for
a definition of terrorism."
State Terrorism
Alternatively, responding to developments in modern warfare, Paul James and
Jonathan Friedman distinguish between state terrorism against non-combatants and
state terrorism against combatants, including 'Shock and Awe' tactics:
Shock and Awe" as a subcategory of "rapid dominance" is the name given to massive
intervention designed to strike terror into the minds of the enemy. It is a form of stateterrorism.
The concept was however developed long before the Second Gulf War by
Harlan Ullman as chair of a forum of retired military personnel.
United Nations
In November 2004, a Secretary-General of the United Nations report described
terrorism as any act "intended to cause death or serious bodily harm to civilians or noncombatants
with the purpose of intimidating a population or compelling a government or
an international organization to do or abstain from doing any act". The international
community has been slow to formulate a universally agreed, legally binding definition of
this crime. These difficulties arise from the fact that the term "terrorism" is politically and
emotionally charged. In this regard, Angus Martyn, briefing the Australian parliament,
stated,
The international community has never succeeded in developing an accepted
comprehensive definition of terrorism. During the 1970s and 1980s, the United Nations
attempts to define the term floundered mainly due to differences of opinion between
various members about the use of violence in the context of conflicts over national
liberation and self-determination.
These divergences have made it impossible for the United Nations to conclude a
Comprehensive Convention on International Terrorism that incorporates a single, allencompassing,
legally binding, criminal law definition of terrorism. The international
community has adopted a series of sectoral conventions that define and criminalize
various types of terrorist activities.
Since 1994, the United Nations General Assembly has repeatedly condemned terrorist
acts using the following political description of terrorism:
Criminal acts intended or calculated to provoke a state of terror in the public, a group of
persons or particular persons for political purposes are in any circumstance
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unjustifiable, whatever the considerations of a political, philosophical, ideological, racial,
ethnic, religious or any other nature that may be invoked to justify them.
U.S. Law
Various legal systems and government agencies use different definitions of terrorism in
their national legislation.
U.S. Code Title 22 Chapter 38, Section 2656f(d) defines terrorism as: "Premeditated,
politically motivated violence perpetrated against noncombatant targets by subnational
groups or clandestine agents, usually intended to influence an audience".
18 U.S.C. § 2331 defines "international terrorism" and "domestic terrorism" for purposes
of Chapter 113B of the Code, entitled "Terrorism":
"International terrorism" means activities with the following three characteristics:
Involve violent acts or acts dangerous to human life that violate federal or state law; Appear to be
intended (i) to intimidate or coerce a civilian population; (ii) to influence the policy of a government
by intimidation or coercion; or (iii) to affect the conduct of a government by mass destruction,
assassination, or kidnapping; and occur primarily outside the territorial jurisdiction of the U.S., or
transcend national boundaries in terms of the means by which they are accomplished, the
persons they appear intended to intimidate or coerce, or the locale in which their perpetrators
operate or seek asylum.
Media Spectacle
A definition proposed by Carsten Bockstette at the George C. Marshall European
Center for Security Studies, underlines the psychological and tactical aspects of
terrorism:
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Terrorism is defined as political violence in an asymmetrical conflict that is designed to
induce terror and psychic fear (sometimes indiscriminate) through the violent
victimization and destruction of noncombatant targets (sometimes iconic symbols).
Such acts are meant to send a message from an illicit clandestine organization. The
purpose of terrorism is to exploit the media in order to achieve maximum attainable
publicity as an amplifying force multiplier in order to influence the targeted audience(s)
in order to reach short- and midterm political goals and/or desired long-term end states.
Terrorists attack national symbols, which may negatively affect a government, while
increasing the prestige of the given terrorist group or its ideology.
Political Violence
Terrorist acts frequently have a political purpose. Some official, governmental definitions
of terrorism use the criterion of the illegitimacy or unlawfulness of the act. to distinguish
between actions authorized by a government (and thus "lawful") and those of other
actors, including individuals and small groups. For example, carrying out a strategic
bombing on an enemy city, which is designed to affect civilian support for a cause,
would not be considered terrorism if it were authorized by a government. This criterion
is inherently problematic and is not universally accepted, because: it denies the
existence of state terrorism. An associated term is violent non-state actor.
According to Ali Khan, the distinction lies ultimately in a political judgment.
Pejorative Use
Having the moral charge in our vocabulary of 'something morally wrong', the term
'terrorism' is often used to abuse or denounce opposite parties, either governments or
non-state-groups.
Those labeled "terrorists" by their opponents rarely identify themselves as such, and
typically use other terms or terms specific to their situation, such as separatist, freedom
fighter, liberator, revolutionary, vigilante, militant, paramilitary, guerrilla, rebel, patriot, or
any similar-meaning word in other languages and cultures. Jihadi, mujaheddin, and
fedayeen are similar Arabic words that have entered the English lexicon. It is common
for both parties in a conflict to describe each other as terrorists.
On whether particular terrorist acts, such as killing non-combatants, can be justified as
the lesser evil in a particular circumstance, philosophers have expressed different
views: while, according to David Rodin, utilitarian philosophers can (in theory) conceive
of cases in which the evil of terrorism is outweighed by the good that could not be
achieved in a less morally costly way, in practice the "harmful effects of undermining the
convention of non-combatant immunity is thought to outweigh the goods that may be
achieved by particular acts of terrorism". Among the non-utilitarian philosophers,
Michael Walzer argued that terrorism can be morally justified in only one specific case:
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when "a nation or community faces the extreme threat of complete destruction and the
only way it can preserve itself is by intentionally targeting non-combatants, then it is
morally entitled to do so".
In his book Inside Terrorism Bruce Hoffman offered an explanation of why the term
terrorism becomes distorted:
On one point, at least, everyone agrees: terrorism is a pejorative term. It is a word with
intrinsically negative connotations that is generally applied to one's enemies and opponents, or to
those with whom one disagrees and would otherwise prefer to ignore. 'What is called terrorism,'
Brian Jenkins has written, 'thus seems to depend on one's point of view. Use of the term implies a
moral judgment; and if one party can successfully attach the label terrorist to its opponent, then it
has indirectly persuaded others to adopt its moral viewpoint.' Hence the decision to call someone
or label some organization terrorist becomes almost unavoidably subjective, depending largely on
whether one sympathizes with or opposes the person/group/cause concerned. If one identifies
with the victim of the violence, for example, then the act is terrorism. If, however, one identifies
with the perpetrator, the violent act is regarded in a more sympathetic, if not positive (or, at the
worst, an ambivalent) light; and it is not terrorism.
The pejorative connotations of the word can be summed up in the aphorism, "One
man's terrorist is another man's freedom fighter". This is exemplified when a group
using irregular military methods is an ally of a state against a mutual enemy, but later
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falls out with the state and starts to use those methods against its former ally. During
World War II, the Malayan People's Anti-Japanese Army was allied with the British, but
during the Malayan Emergency, members of its successor (the Malayan Races
Liberation Army), were branded "terrorists" by the British. More recently, Ronald
Reagan and others in the American administration frequently called the mujaheddin
"freedom fighters" during the Soviet–Afghan War yet twenty years later, when a new
generation of Afghan men were fighting against what they perceive to be a regime
installed by foreign powers, their attacks were labelled "terrorism" by George W. Bush.
Groups accused of terrorism understandably prefer terms reflecting legitimate military or
ideological action. Leading terrorism researcher Professor Martin Rudner, director of the
Canadian Centre of Intelligence and Security Studies at Ottawa's Carleton University,
defines "terrorist acts" as unlawful attacks for political or other ideological goals, and
said:
There is the famous statement: 'One man's terrorist is another man's freedom fighter.' But that is
grossly misleading. It assesses the validity of the cause when terrorism is an act. One can have a
perfectly beautiful cause and yet if one commits terrorist acts, it is terrorism regardless.
Some groups, when involved in a "liberation" struggle, have been called "terrorists" by
the Western governments or media. Later, these same persons, as leaders of the
liberated nations, are called "statesmen" by similar organizations. Two examples of this
phenomenon are the Nobel Peace Prize laureates Menachem Begin and Nelson
Mandela. WikiLeaks editor Julian Assange has been called a "terrorist" by Sarah Palin
and Joe Biden.
Sometimes, states that are close allies, for reasons of history, culture and politics, can
disagree over whether or not members of a certain organization are terrorists. For
instance, for many years, some branches of the United States government refused to
label members of the Provisional Irish Republican Army (IRA) as terrorists while the IRA
was using methods against one of the United States' closest allies (the United Kingdom)
that the UK branded as terrorism. This was highlighted by the Quinn v. Robinson case.
Media outlets who wish to convey impartiality may limit their usage of "terrorist" and
"terrorism" because they are loosely defined, potentially controversial in nature, and
subjective terms.
History
Depending on how broadly the term is defined, the roots and practice of terrorism can
be traced at least to the 1st-century AD. Sicarii Zealots, though some dispute whether
the group, a radical offshoot of the Zealots which was active in Judaea Province at the
beginning of the 1st century AD, was in fact terrorist. According to the contemporary
Jewish-Roman historian Josephus, after the Zealotry rebellion against Roman rule in
Judea, when some prominent Jewish collaborators with Roman rule were killed, Judas
of Galilee formed a small and more extreme offshoot of the Zealots, the Sicarii, in 6 AD.
Their terror was directed against Jewish "collaborators", including temple priests,
Sadducees, Herodians, and other wealthy elites.
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The term "terrorism" itself was originally used to describe the actions of the Jacobin
Club during the "Reign of Terror" in the French Revolution. "Terror is nothing other than
justice, prompt, severe, inflexible", said Jacobin leader Maximilien Robespierre. In 1795,
Edmund Burke denounced the Jacobins for letting "thousands of those hell-hounds
called Terrorists ... loose on the people" of France.
In January 1858, Italian patriot Felice Orsini threw three bombs in an attempt to
assassinate French Emperor Napoleon III. Eight bystanders were killed and 142 injured.
The incident played a crucial role as an inspiration for the development of the early
terrorist groups.
Arguably the first organization to utilize modern terrorist techniques was the Irish
Republican Brotherhood, founded in 1858 as a revolutionary Irish nationalist group that
carried out attacks in England. The group initiated the Fenian dynamite campaign in
1881, one of the first modern terror campaigns. Instead of earlier forms of terrorism
based on political assassination, this campaign used modern, timed explosives with the
express aim of sowing fear in the very heart of metropolitan Britain, in order to achieve
political gains.
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Another early terrorist group was Narodnaya Volya, founded in Russia in 1878 as a
revolutionary anarchist group inspired by Sergei Nechayev and "propaganda by the
deed" theorist Carlo Pisacane. The group developed ideas – such as targeted killing of
the 'leaders of oppression' – that were to become the hallmark of subsequent violence
by small non-state groups, and they were convinced that the developing technologies of
the age – such as the invention of dynamite, which they were the first anarchist group to
make widespread use of – enabled them to strike directly and with discrimination.
Scholars of terrorism refer to four major waves of global terrorism: "the Anarchist, the
Anti-Colonial, the New Left, and the Religious. The first three have been completed and
lasted around 40 years; the fourth is now in its third decade."
Types
Infographics
Depending on the country, the political system, and the time in history, the types of
terrorism are varying.
In early 1975, the Law Enforcement Assistant Administration in the United States
formed the National Advisory Committee on Criminal Justice Standards and Goals. One
of the five volumes that the committee wrote was titled Disorders and Terrorism,
produced by the Task Force on Disorders and Terrorism under the direction of H. H. A.
Cooper, Director of the Task Force staff.
The Task Force defines terrorism as "a tactic or technique by means of which a violent
act or the threat thereof is used for the prime purpose of creating overwhelming fear for
coercive purposes". It classified disorders and terrorism into six categories:
Civil Disorder – A form of collective violence interfering with the peace, security,
and normal functioning of the community.
Political Terrorism – Violent criminal behavior designed primarily to generate
fear in the community, or substantial segment of it, for political purposes.
Non-Political Terrorism – Terrorism that is not aimed at political purposes but
which exhibits "conscious design to create and maintain a high degree of fear for
coercive purposes, but the end is individual or collective gain rather than the
achievement of a political objective".
Quasi-Terrorism – The activities incidental to the commission of crimes of
violence that are similar in form and method to genuine terrorism but which
nevertheless lack its essential ingredient. It is not the main purpose of the quasiterrorists
to induce terror in the immediate victim as in the case of genuine
terrorism, but the quasi-terrorist uses the modalities and techniques of the
genuine terrorist and produces similar consequences and reaction. For example,
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the fleeing felon who takes hostages is a quasi-terrorist, whose methods are
similar to those of the genuine terrorist but whose purposes are quite different.
Limited Political Terrorism – Genuine political terrorism is characterized by a
revolutionary approach; limited political terrorism refers to "acts of terrorism
which are committed for ideological or political motives but which are not part of a
concerted campaign to capture control of the state".
Official or State Terrorism – "referring to nations whose rule is based upon fear
and oppression that reach similar to terrorism or such proportions". It may be
referred to as Structural Terrorism defined broadly as terrorist acts carried out
by governments in pursuit of political objectives, often as part of their foreign
policy.
Other sources have defined the typology of terrorism in different ways, for example,
broadly classifying it into domestic terrorism and international terrorism, or using
categories such as vigilante terrorism or insurgent terrorism. One way the typology of
terrorism may be defined:
Political terrorism
o
Sub-state terrorism
• Social revolutionary terrorism
• Nationalist-separatist terrorism
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• Religious extremist terrorism
• Religious fundamentalist Terrorism
• New religions terrorism
• Right-wing terrorism
• Left-wing terrorism
• Communist terrorism
o
o
State-sponsored terrorism
Regime or state terrorism
Criminal terrorism
Pathological terrorism
Motivations of Terrorists
As well as there being no one agreed definition of terrorism, there is a similar lack of
consensus regarding the causes – or motivations behind – terrorism. Numerous studies
have identified certain behavioral and situational characteristics that are common, and
perhaps causal, to the consequence of terrorism, specific analysis of case studies have
led to suggested motivations to individual historical acts.
A report conducted by Paul Gill, John Horgan and Paige Deckert on behalf of The
Department of security of UK highlights the vast discrepancies between individual cases
of terrorism recorded. To begin with, 43 percent of lone wolf terrorism is motivated by
religious beliefs. The same report indicates that just less than a third (32 percent) have
pre-existing mental health disorders, while many more are found to have these
problems upon arrest. At least 37 percent lived alone at the time of their event planning
and/or execution, a further 26 percent lived with others, and no data were available for
the remaining cases. 40 percent were unemployed at the time of their arrest or terrorist
event. 19 percent subjectively experienced being disrespected by others, while 14
percent experienced being the victim of verbal or physical assault.
Intimidation
Attacks on 'collaborators' are used to intimidate people from cooperating with the state
in order to undermine state control. This strategy was used in Ireland, in Kenya, in
Algeria and in Cyprus during their independence struggles.
International Attention
This strategy was used by Al-Qaeda in its attacks on the World Trade Center and the
Pentagon in the United States on September 11, 2001. These attacks are used to draw
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international attention to struggles that are otherwise unreported, such as the
Palestinian airplane hijackings in 1970 and the 1975 Dutch train hostage crisis.
Local/Internal Social Standing
Abrahm suggests that terrorist organizations do not select terrorism for its political
effectiveness. Individual terrorists tend to be motivated more by a desire for social
solidarity with other members of their organization than by political platforms or strategic
objectives, which are often murky and undefined.
Cultural Tolerance of Violence
Additionally, Michael Mousseau shows possible relationships between the type of
economy within a country and ideology associated with terrorism. Many terrorists have
a history of domestic violence.
Perceived Illegitimacy of The State
Some terrorists like Timothy McVeigh were motivated by revenge against a state for its
actions against its citizens.
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Religious Beliefs/ Zealotry
According to Paul Gill, John Horgan and Paige Deckert on behalf of The Department of
security of UK, 43 percent of lone wolf terrorism is motivated by religious beliefs. The
same report indicates that Just less than a third (32 percent) have pre-existing mental
health disorders, while many are found to have these problems upon arrest. At least 37
percent lived alone at the time of their event planning and/or execution, a further 26
percent lived with others, and no data were available for the remaining cases. 40
percent were unemployed at the time of their arrest or terrorist event. Many were
chronically unemployed and consistently struggled to hold any form of employment for a
significant amount of time. 19 percent subjectively experienced being disrespected by
others, while 14.3 percent experienced being the victim of verbal or physical assault.
Mental Health
Ariel Merari, a psychologist who has studied the psychological profiles of suicide
terrorists since 1983 through media reports that contained biographical details,
interviews with the suicides’ families, and interviews with jailed would-be suicide
attackers, concluded that they were unlikely to be psychologically abnormal.
In comparison to economic theories of criminal behaviour, Scott Atran found that suicide
terrorists exhibit none of the socially dysfunctional attributes – such as fatherless,
friendless, jobless situations – or suicidal symptoms. By which he means, they do not
kill themselves simply out of hopelessness or a sense of 'having nothing to lose'.
Nationalism
Although a common factor in terrorism is a strong religious belief there are other factors
such as cultural, social and political that wholly preclude religion. For example, the drive
behind these Chechen terrorists are quite distinct and unique from others. Many of the
Chechens considered themselves secular freedom fighters, nationalist insurgents
seeking to establish an independent secular state of Chechnya. Although a distinction
should be made between national Chechen terrorists and non-Chechen fighters who
have adopted the idea from abroad. Few Chechen fighters fought for the jihads whereas
most of the non-Chechen fighters did (Janeczko, 2014).
Financial Support for Family
Another factor are perceived assurances of financial stability for the actor's families, that
they are given when they join a terrorist organization or complete an attempt of terror.
An extra grant is provided for the families of suicide bombers.
Democracy and Domestic Terrorism
Terrorism is most common in nations with intermediate political freedom, and it is least
common in the most democratic nations. one study suggests that suicide attacks may
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e an exception to this general rule. Evidence regarding this particular method of
terrorism reveals that every modern suicide campaign has targeted a democracy–a
state with a considerable degree of political freedom. The study suggests that
concessions awarded to terrorists during the 1980s and 1990s for suicide attacks
increased their frequency. There is a connection between the existence of civil liberties,
democratic participation and terrorism. According to Young and Dugan, these things
encourage terrorist groups to organize and generate terror.
Some examples of "terrorism" in non-democratic nations include ETA in Spain under
Francisco Franco (although the group's terrorist activities increased sharply after
Franco's death), the Organization of Ukrainian Nationalists in pre-war Poland, the
Shining Path in Peru under Alberto Fujimori, the Kurdistan Workers Party when Turkey
was ruled by military leaders and the ANC in South Africa. Democracies, such as
Japan, the United Kingdom, the United States, Israel, Indonesia, India, Spain, Germany,
Italy and the Philippines, have experienced domestic terrorism.
While a democratic nation espousing civil liberties may claim a sense of higher moral
ground than other regimes, an act of terrorism within such a state may cause a
dilemma: whether to maintain its civil liberties and thus risk being perceived as
ineffective in dealing with the problem; or alternatively to restrict its civil liberties and
thus risk delegitimizing its claim of supporting civil liberties. For this reason, homegrown
terrorism has started to be seen as a greater threat, as stated by former CIA Director
Michael Hayden. This dilemma, some social theorists would conclude, may very well
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play into the initial plans of the acting terrorist(s); namely, to delegitimize the state and
cause a systematic shift towards anarchy via the accumulation of negative sentiments
towards the state system.
Religious Terrorism
Terrorist acts throughout history have been performed on religious grounds with the
goal to either spread or enforce a system of belief, viewpoint or opinion. The validity and
scope of religious terrorism is limited to an individual's view or a group's view or
interpretation of that belief system's teachings.
According to the Global Terrorism Index by the University of Maryland, College Park,
religious extremism has overtaken national separatism and become the main driver of
terrorist attacks around the world. Since 9/11 there has been a five-fold increase in
deaths from terrorist attacks. The majority of incidents over the past several years can
be tied to groups with a religious agenda. Before 2000, it was nationalist separatist
terrorist organizations such as the IRA and Chechen rebels who were behind the most
attacks. The number of incidents from nationalist separatist groups has remained
relatively stable in the years since while religious extremism has grown. The prevalence
of Islamist groups in Iraq, Afghanistan, Pakistan, Nigeria and Syria is the main driver
behind these trends.
Four of the terrorist groups that have been most active since 2001 are Boko Haram, Al
Qaeda, the Taliban and ISIL. These groups have been most active in Iraq, Afghanistan,
Pakistan, Nigeria and Syria. 80 percent of all deaths from terrorism occurred in one of
these five countries.
Terrorism in Pakistan has become a great problem. From the summer of 2007 until late
2009, more than 1,500 people were killed in suicide and other attacks on civilians for
reasons attributed to a number of causes – sectarian violence between Sunni and Shia
Muslims; easy availability of guns and explosives; the existence of a "Kalashnikov
culture"; an influx of ideologically driven Muslims based in or near Pakistan, who
originated from various nations around the world and the subsequent war against the
pro-Soviet Afghans in the 1980s which blew back into Pakistan; the presence of Islamist
insurgent groups and forces such as the Taliban and Lashkar-e-Taiba. Pakistan is the
10th most dangerous country by criminality index. On July 2, 2013 in Lahore, 50 Muslim
scholars of the Sunni Ittehad Council (SIC) issued a collective fatwa against suicide
bombings, the killing of innocent people, bomb attacks, and targeted killings declaring
them as Haraam or forbidden.
In 2015, the Southern Poverty Law Center released a report on terrorism in the United
States. The report (titled The Age of the Wolf) found that during that period, "more
people have been killed in America by non-Islamic domestic terrorists than jihadists."
The "virulent racist and anti-semitic" ideology of the ultra-right wing Christian Identity
movement is usually accompanied by anti-government sentiments. Adherents of
Christian Identity believe that whites of European descent can be traced back to the
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"Lost Tribes of Israel" and many consider Jews to be the Satanic offspring of Eve and
the Serpent. This group has committed hate crimes, bombings and other acts of
terrorism. Its influence ranges from the Ku Klux Klan and neo-Nazi groups to the antigovernment
militia and sovereign citizen movements. Christian Identity's origins can be
traced back to Anglo-Israelism. Anglo-Israelism held the view that Jews were
descendants of ancient Israelites who had never been lost. By the 1930s, the
movement had been infected with anti-Semitism, and eventually Christian Identity
theology diverged from traditional Anglo-Israelism, and developed what is known as the
"two seed" theory. According to the two-seed theory, the Jewish people are descended
from Cain and the serpent (not from Shem). The white European seedline is descended
from the "lost tribes" of Israel. They hold themselves to "God's laws", not to "man's
laws", and they do not feel bound to a government that they consider run by Jews and
the New World Order.
Israel has had problems with Jewish religious terrorism. Yigal Amir assassinated Israeli
Prime Minister Yitzhak Rabin in 1995. For Amir, killing Rabin was an exemplary act that
symbolized the fight against an illegitimate government that was prepared to cede
Jewish Holy Land to the Palestinians.
Perpetrators
The perpetrators of acts of terrorism can be individuals, groups, or states. According to
some definitions, clandestine or semi-clandestine state actors may carry out terrorist
acts outside the framework of a state of war. the most common image of terrorism is
that it is carried out by small and secretive cells, highly motivated to serve a particular
cause and many of the most deadly operations in recent times, such as the September
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11 attacks, the London underground bombing, 2008 Mumbai attacks and the 2002 Bali
bombing were planned and carried out by a close clique, composed of close friends,
family members and other strong social networks. These groups benefited from the free
flow of information and efficient telecommunications to succeed where others had failed.
Over the years, much research has been conducted to distill a terrorist profile to explain
these individuals' actions through their psychology and socio-economic circumstances.
Others, like Roderick Hindery, have sought to discern profiles in the propaganda tactics
used by terrorists. Some security organizations designate these groups as violent nonstate
actors. A 2007 study by economist Alan B. Krueger found that terrorists were less
likely to come from an impoverished background (28 percent vs. 33 percent) and more
likely to have at least a high-school education (47 percent vs. 38 percent). Another
analysis found only 16 percent of terrorists came from impoverished families, vs. 30
percent of male Palestinians, and over 60 percent had gone beyond high school, vs. 15
percent of the populace.
A study into the poverty-stricken conditions and whether or not, terrorists are more likely
to come from here, show that people who grew up in these situations tend to show
aggression and frustration towards others. This theory is largely debated for the simple
fact that just because one is frustrated, does not make them a potential terrorist.
To avoid detection, a terrorist will look, dress, and behave normally until executing the
assigned mission. Some claim that attempts to profile terrorists based on personality,
physical, or sociological traits are not useful. The physical and behavioral description of
the terrorist could describe almost any normal person. the majority of terrorist attacks
are carried out by military age men, aged 16–40.
Non-State Groups
Groups not part of the state apparatus of in opposition to the state are most commonly
referred to as a "terrorist" in the media.
According to the Global Terrorism Database, the most active terrorist group in the
period 1970 to 2010 was Shining Path (with 4,517 attacks), followed by Farabundo
Marti National Liberation Front (FMLN), Irish Republican Army (IRA), Basque
Fatherland and Freedom (ETA), Revolutionary Armed Forces of Colombia (FARC),
Taliban, Liberation Tigers of Tamil Eelam, New People's Army, National Liberation Army
of Colombia (ELN), and Kurdistan Workers Party (PKK).
State Sponsors
A state can sponsor terrorism by funding or harboring a terrorist group. Opinions as to
which acts of violence by states consist of state-sponsored terrorism vary widely. When
states provide funding for groups considered by some to be terrorist, they rarely
acknowledge them as such.
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State Terrorism
Civilization is based on a clearly defined and widely accepted yet often unarticulated
hierarchy. Violence done by those higher on the hierarchy to those lower is nearly
always invisible, that is, unnoticed. When it is noticed, it is fully rationalized. Violence
done by those lower on the hierarchy to those higher is unthinkable, and when it does
occur it is regarded with shock, horror, and the fetishization of the victims.
— Derrick Jensen
As with "terrorism" the concept of "state terrorism" is controversial. The Chairman of the
United Nations Counter-Terrorism Committee has stated that the Committee was
conscious of 12 international Conventions on the subject, and none of them referred to
State terrorism, which was not an international legal concept. If States abused their
power, they should be judged against international conventions dealing with war crimes,
international human rights law, and international humanitarian law. Former United
Nations Secretary-General Kofi Annan has said that it is "time to set aside debates on
so-called 'state terrorism'. The use of force by states is already thoroughly regulated
under international law". he made clear that, "regardless of the differences between
governments on the question of the definition of terrorism, what is clear and what we
can all agree on is that any deliberate attack on innocent civilians [or non-combatants],
regardless of one's cause, is unacceptable and fits into the definition of terrorism."
USS Arizona (BB-39) burning during the Japanese surprise attack on Pearl Harbor,
December 7, 1941.
State terrorism has been used to refer to terrorist acts committed by governmental
agents or forces. This involves the use of state resources employed by a state's foreign
policies, such as using its military to directly perform acts of terrorism. Professor of
Political Science Michael Stohl cites the examples that include the German bombing of
London, the Japanese bombing of Pearl Harbor, the British and American firebombing
of Dresden, and the U.S. atomic bombings of Hiroshima and Nagasaki during World
War II. He argues that "the use of terror tactics is common in international relations and
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the state has been and remains a more likely employer of terrorism within the
international system than insurgents." He cites the first strike option as an example of
the "terror of coercive diplomacy" as a form of this, which holds the world hostage with
the implied threat of using nuclear weapons in "crisis management" and he argues that
the institutionalized form of terrorism has occurred as a result of changes that took
place following World War II. In this analysis, state terrorism exhibited as a form of
foreign policy was shaped by the presence and use of weapons of mass destruction,
and the legitimizing of such violent behavior led to an increasingly accepted form of this
behavior by the state.
Charles Stewart Parnell described William Ewart Gladstone's Irish Coercion Act as
terrorism in his "no-Rent manifesto" in 1881, during the Irish Land War. The concept is
used to describe political repressions by governments against their own civilian
populations with the purpose of inciting fear. For example, taking and executing civilian
hostages or extrajudicial elimination campaigns are commonly considered "terror" or
terrorism, for example during the Red Terror or the Great Terror. Such actions are often
described as democide or genocide, which have been argued to be equivalent to state
terrorism.
Empirical studies on this have found that democracies have little democide. Western
democracies, including the United States, have supported state terrorism and mass
killings, with some examples being the Indonesian mass killings of 1965–66 and
Operation Condor.
Connection with Tourism
The connection between terrorism and tourism has been widely studied since the Luxor
massacre in Egypt. In the 1970s, the targets of terrorists were politicians and chiefs of
police while now, international tourists and visitors are selected as the main targets of
attacks. The attacks on the World Trade Center and the Pentagon on September 11,
2001, were the symbolic epicenter, which marked a new epoch in the use of civil
transport against the main power of the planet. From this event onwards, the spaces of
leisure that characterized the pride of West, were conceived as dangerous and frightful.
Funding
State sponsors have constituted a major form of funding; for example, Palestine
Liberation Organization, Democratic Front for the Liberation of Palestine and other
groups considered to be terrorist organizations, were funded by the Soviet Union. The
Stern Gang received funding from Italian Fascist officers in Beirut to undermine the
British Mandate for Palestine. Pakistan has created and nurtured terrorist groups as
policy for achieving tactical objectives against its neighbors, especially India.
"Revolutionary tax" is another major form of funding, and essentially a euphemism for
"protection money". Revolutionary taxes "play a secondary role as one other means of
intimidating the target population".
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Other major sources of funding include kidnapping for ransoms, smuggling (including
wildlife smuggling), fraud, and robbery. The Islamic State in Iraq and the Levant has
reportedly received funding "via private donations from the Gulf states".
The Financial Action Task Force is an inter-governmental body whose mandate, since
October 2001, has included combating terrorist financing.
Tactics
Terrorist attacks are often targeted to maximize fear and publicity, usually using
explosives or poison. Terrorist groups usually methodically plan attacks in advance, and
may train participants, plant undercover agents, and raise money from supporters or
through organized crime. Communications occur through modern telecommunications,
or through old-fashioned methods such as couriers. There is concern about terrorist
attacks employing weapons of mass destruction.
Terrorism is a form of asymmetric warfare, and is more common when direct
conventional warfare will not be effective because forces vary greatly in power.
The context in which terrorist tactics are used is often a large-scale, unresolved political
conflict. The type of conflict varies widely; historical examples include:
Secession of a territory to form a new sovereign state or become part of a
different state
Dominance of territory or resources by various ethnic groups
Imposition of a particular form of government
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Economic deprivation of a population
Opposition to a domestic government or occupying army
Religious fanaticism
Responses
Responses to terrorism are broad in scope. They can include re-alignments of the
political spectrum and reassessments of fundamental values.
Specific types of responses include:
Targeted laws, criminal procedures, deportations, and enhanced police powers
Target hardening, such as locking doors or adding traffic barriers
Preemptive or reactive military action
Increased intelligence and surveillance activities
Preemptive humanitarian activities
More permissive interrogation and detention policies
The term "counter-terrorism" has a narrower connotation, implying that it is directed at
terrorist actors.
Response in The United States
According to the TSA, this is what the remote TSA agent would see on their screen.
According to a report by Dana Priest and William M. Arkin in The Washington Post,
"Some 1,271 government organizations and 1,931 private companies work on programs
related to counterterrorism, homeland security and intelligence in about 10,000
locations across the United States."
America's thinking on how to defeat radical Islamists is split along two very different
schools of thought. Republicans, typically follow what is known as the Bush Doctrine,
advocate the military model of taking the fight to the enemy and seeking to democratize
the Middle East. Democrats, by contrast, generally propose the law enforcement model
of better cooperation with nations and more security at home. In the introduction of the
U.S. Army / Marine Corps Counterinsurgency Field Manual, Sarah Sewall states the
need for "U.S. forces to make securing the civilian, rather than destroying the enemy,
their top priority. The civilian population is the center of gravity – the deciding factor in
the struggle.... Civilian deaths create an extended family of enemies – new insurgent
recruits or informants – and erode support of the host nation." Sewall sums up the
book's key points on how to win this battle: "Sometimes, the more you protect your
force, the less secure you may be.... Sometimes, the more force is used, the less
effective it is.... The more successful the counterinsurgency is, the less force can be
used and the more risk must be accepted.... Sometimes, doing nothing is the best
reaction." This strategy, often termed "courageous restraint", has certainly led to some
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success on the Middle East battlefield, yet it fails to address the central truth: the
terrorists we face are mostly homegrown.
Terrorism Research
Terrorism research, called terrorism and counter-terrorism research, is an
interdisciplinary academic field which seeks to understand the causes of terrorism, how
to prevent it as well as its impact in the broadest sense. Terrorism research can be
carried out in both military and civilian contexts, for example by research centers such
as the British Centre for the Study of Terrorism and Political Violence, the Norwegian
Centre for Violence and Traumatic Stress Studies, and the International Centre for
Counter-Terrorism (ICCT). There are several academic journals devoted to the field.
International Agreements
One of the agreements that promote the international legal anti-terror framework is the
Code of Conduct Towards Achieving a World Free of Terrorism that was adopted at the
73rd session of the United Nations General Assembly in 2018. The Code of Conduct
was initiated by Kazakhstan President Nursultan Nazarbayev. Its main goal is to
implement a wide range of international commitments to counter terrorism and establish
a broad global coalition towards achieving a world free of terrorism by 2045. The Code
was signed by more than 70 countries.
Mass Media
Mass media exposure may be a primary goal of those carrying out terrorism, to expose
issues that would otherwise be ignored by the media. Some consider this to be
manipulation and exploitation of the media.
The Internet has created a new channel for groups to spread their messages. This has
created a cycle of measures and counter measures by groups in support of and in
opposition to terrorist movements. The United Nations has created its own online
counter-terrorism resource.
The mass media will, on occasion, censor organizations involved in terrorism (through
self-restraint or regulation) to discourage further terrorism. This may encourage
organizations to perform more extreme acts of terrorism to be shown in the mass
media. Conversely James F. Pastor explains the significant relationship between
terrorism and the media, and the underlying benefit each receives from the other.
There is always a point at which the terrorist ceases to manipulate the media gestalt. A
point at which the violence may well escalate, but beyond which the terrorist has
become symptomatic of the media gestalt itself. Terrorism as we ordinarily understand it
is innately media-related.
— Novelist William Gibson
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Former British Prime Minister Margaret Thatcher famously spoke of the close
connection between terrorism and the media, calling publicity 'the oxygen of terrorism'.
Outcome of Terrorist Groups
How terrorist groups end (n = 268): The most common ending for a terrorist group is to
convert to nonviolence via negotiations (43 percent), with most of the rest terminated by
routine policing (40 percent). Groups that were ended by military force constituted only
7 percent.
Jones and Libicki (2008) created a list of all the terrorist groups they could find that were
active between 1968 and 2006. They found 648. of those, 136 splintered and 244 were
still active in 2006. Of the ones that ended, 43 percent converted to nonviolent political
actions, like the Irish Republican Army in Northern Ireland. Law enforcement took out 40
percent. Ten percent won. Only 20 groups, 7 percent, were taken out by military force.
Forty-two groups became large enough to be labeled an insurgency; 38 of those had
ended by 2006. Of those, 47 percent converted to nonviolent political actors. Only 5
percent were taken out by law enforcement. 26 percent won. 21 percent succumbed to
military force. Jones and Libicki concluded that military force may be necessary to deal
with large insurgencies but are only occasionally decisive, because the military is too
often seen as a bigger threat to civilians than the terrorists. To avoid that, the rules of
engagement must be conscious of collateral damage and work to minimize it.
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Another researcher, Audrey Cronin, lists six primary ways that terrorist groups end:
1. Capture or killing of a group's leader. (Decapitation).
2. Entry of the group into a legitimate political process. (Negotiation).
3. Achievement of group aims. (Success).
4. Group implosion or loss of public support. (Failure).
5. Defeat and elimination through brute force. (Repression).
6. Transition from terrorism into other forms of violence. (Reorientation).
Databases
The following terrorism databases are or were made publicly available for research
purposes, and track specific acts of terrorism:
Global Terrorism Database, an open-source database by the University of
Maryland, College Park on terrorist events around the world from 1970 through
2017 with more than 150,000 cases.
MIPT Terrorism Knowledge Base
Worldwide Incidents Tracking System
Tocsearch (dynamic database)
The following public report and index provides a summary of key global trends and
patterns in terrorism around the world
Global Terrorism Index, produced annually by the Institute for Economics and
Peace
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The following publicly available resources index electronic and bibliographic resources
on the subject of terrorism
Human Security Gateway
The following terrorism databases are maintained in secrecy by the United States
Government for intelligence and counter-terrorism purposes:
Terrorist Identities Datamart Environment
Terrorist Screening Database
Jones and Libicki (2008) includes a table of 268 terrorist groups active between 1968
and 2006 with their status as of 2006: still active, splintered, converted to nonviolence,
removed by law enforcement or military, or won. (These data are not in a convenient
machine-readable format but are available.)
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XVIII. Theft
In common usage, Theft is the taking of another person's property or services without
that person's permission or consent with the intent to deprive the rightful owner of it. The
word is also used as an informal shorthand term for some crimes against property, such
as burglary, embezzlement, larceny, looting, robbery, shoplifting, library theft, and fraud
(obtaining money under false pretenses). In some jurisdictions, theft is considered to be
synonymous with larceny; in others, theft has replaced larceny. Someone who carries
out an act of or makes a career of theft is known as a thief. The act of theft is also
known by other terms such as stealing, thieving, and filching.
Theft is the name of a statutory offence in California, Canada, England and Wales,
Hong Kong, Northern Ireland, the Republic of Ireland, and the Australian states of South
Australia, and Victoria.
Elements
The actus reus of theft is usually defined as an unauthorized taking, keeping, or using of
another's property which must be accompanied by a mens rea of dishonesty and the
intent permanently to deprive the owner or rightful possessor of that property or its use.
For example, if X goes to a restaurant and, by mistake, takes Y's scarf instead of her
own, she has physically deprived Y of the use of the property (which is the actus reus)
but the mistake prevents X from forming the mens rea (i.e., because she believes that
she is the owner, she is not dishonest and does not intend to deprive the "owner" of it)
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so no crime has been committed at this point. But if she realizes the mistake when she
gets home and could return the scarf to Y, she will steal the scarf if she dishonestly
keeps it (see theft by finding). Note that there may be civil liability for the torts of
trespass to chattels or conversion in either eventuality.
Canada
By Jurisdiction
Section 322(1) of the Criminal Code provides the general definition for theft in Canada:
322. (1) Every one commits theft who fraudulently and without color of right takes, or
fraudulently and without color of right converts to his/her use or to the use of another
person, anything, whether animate or inanimate, with intent
(a) to deprive, temporarily or absolutely, the owner of it, or a person who has a special
property or interest in it, of the thing or of his property or interest in it;
(b) to pledge it or deposit it as security;
(c) to part with it under a condition with respect to its return that the person who parts
with it may be unable to perform; or
(d) to deal with it in such a manner that it cannot be restored in the condition in which it
was at the time it was taken or converted.
Sections 323 to 333 provide for more specific instances and exclusions:
theft from oyster beds (s. 323)
theft by bailee of things under seizure (s. 324)
exception when agent is pledging goods (s. 325)
theft of telecommunications service (s. 326)
possession of device to obtain telecommunication facility or service (s. 327)
theft by or from person having special property or interest (s. 328)
theft by person required to account (s. 330)
theft by person holding power of attorney (s. 331)
misappropriation of money held under direction (s. 332)
exception for ore taken for exploration or scientific research (s. 333)
In the general definition above, the Supreme Court of Canada has construed "anything"
very broadly, stating that it is not restricted to tangibles, but includes intangibles. To be
the subject of theft it must, however:
be property of some sort;
be property capable of being
taken (therefore intangibles are excluded); or
converted (and may be an intangible);
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taken or converted in a way that deprives the owner of his/her proprietary interest
in some way.
Because of this, confidential information cannot be the subject of theft, as it is not
capable of being taken as only tangibles can be taken. It cannot be converted, not
because it is an intangible, but because, save in very exceptional far-fetched
circumstances, the owner would never be deprived of it. However, the theft of trade
secrets in certain circumstances does constitute part of the offence of economic
espionage, which can be prosecuted under s. 19 of the Security of Information Act.
For the purposes of punishment, Section 334 divides theft into two separate offences,
according to the value and nature of the goods stolen:
If the thing stolen is worth more than $5000 or is a testamentary instrument the
offence is commonly referred to as Theft Over $5000 and is an indictable
offence with a maximum punishment of 10 years imprisonment.
Where the stolen item is not a testamentary instrument and is not worth more
than $5000 it is known as Theft Under $5000 and is a hybrid offence, meaning
that it can be treated either as an indictable offence or a less serious summary
conviction offence, depending on the choice of the prosecutor.
if dealt with as an indictable offence, it is punishable by imprisonment for not
more than 2 years, and,
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if treated as a summary conviction offence, it is punishable by 6 months
imprisonment, a fine of $2000 or both.
Where a motor vehicle is stolen, Section 333.1 provides for a maximum punishment of
10 years for an indictable offence (and a minimum sentence of six months for a third or
subsequent conviction), and a maximum sentence of 18 months on summary
conviction.
Hong Kong
Article 2 of the Theft Ordinance provides the general definition of theft in Hong Kong:
(1) A person commits theft if he dishonestly appropriates property belonging to another
with the intention of permanently depriving the other of it; and thief and steal shall be
construed accordingly.
(2) It is immaterial whether the appropriation is made with a view to gain, or is made for
the thief’s own benefit.
The Netherlands
Theft is a crime with related articles in the Wetboek van Strafrecht.
Article 310 prohibits theft (Dutch: diefstal), which is defined as taking away any
object that (partly) belongs to someone else, with the intention to appropriate it
illegally. Maximum imprisonment is 4 years or a fine of the fifth category.
Article 311 consists of the following:
o
Part 1. Punishable with maximum imprisonment of 6 years or a fine of the
fourth category is:
• 1. Theft of cattle;
• 2. Theft during certain emergency occasions;
• 3. Theft during night in a residence by someone who is there
without knowledge or permission of the owner;
• 4. Theft by 2 or more organized people;
• 5. Theft, where the thief got access by means of violence, climbing
in, using false keys or disguise;
• 6. Terroristic theft.
o
Part 2. When theft if committed as in 3 with the situation of 4 and 5, the
punishment is a maximum imprisonment of 9 years or a fine of the fifth
category.
Article 312 consists of the following:
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o
o
Part 1 prohibits robbery (Dutch: beroving), which is defined as taking away
any object with violence or with threat of violence. Maximum imprisonment
is 9 years or a fine with the fifth category
Part 2 allows maximum imprisonment of 12 years or a fine of the fifth
category when:
• 1. Robbery was committed during night, in a residence, on the
public road or moving train;
• 2. Robbery was committed by 2 or more people;
• 3. Robbery was committed by violence, climbing in, false key or
disguise;
• 4. Robbery caused severe injury;
• 5. Robbery was terroristic.
o
Part 3 allows maximum imprisonment of 15 years instead of 12 when
robbery caused death to the victim.
Article 314 consists of the following:
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o
o
Part 1 prohibits poaching (Dutch: stroperij), which is defined as taking
away without violence the following: clay, sand, earth, raw wood, fallen
vegetables (see the source for a complete list). Maximum imprisonment is
one month or a fine of the second category.
Part 2 increases the maximum imprisonment to 2 months when the crime
is committed again less than 2 years after the first time.
Article 315 increases the maximum imprisonment and fine category when
poaching is done with vehicles and draft animals. Maximum imprisonment is 3
years or a fine of the fourth category.
Republic of Ireland
Theft is a statutory offence, created by section 4(1) of the Criminal Justice (Theft and
Fraud Offences) Act, 2001.
Romania
According to the Romanian Penal Code a person committing theft (furt) can face a
penalty ranging from 1 to 20 years.
Degrees of theft:
Article 208: Theft (1 to 12 years)—When a person steals an object, or uses a
vehicle without permission and no aggravating circumstances apply.
Article 209: Qualified theft (3 to 20 years)
Aggravating circumstances (3 to 15 years): a) by two or more persons together;
b) by a person in possession of a gun or a narcotic substance; c) by a masked or
disguised person; d) against a person who cannot defend his or herself; e) in a
public place; f) in a public transportation vehicle; g) during nighttime; h) during a
natural disaster; i) through burglary, or by using an original or copied key; j)
stealing national treasures; k) stealing official identity papers with the intention to
make use of them; l) stealing official identity badges with the intention to make
use of them.
Aggravating circumstances (4 to 18 years): a) stealing petrol-based products
directly from transportation pipes and vehicles or deposits; b) stealing
components from national electrification, telecommunication, irrigation networks
or from any type of navigational system; c) stealing a siren; d) stealing a public
intervention vehicle or device; e) stealing something which jeopardises the safety
of public transportation.
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Aggravating circumstances (10 to 20 years): when the consequences are
extremely grave and affect public institutions or the material stolen is worth over
200,000 RON (approximately US$80,000).
United Kingdom
England and Wales
In England and Wales, theft is a statutory offence, created by section 1(1) of the Theft
Act 1968. This offence replaces the former offences of larceny, embezzlement and
fraudulent conversion.
The marginal note to section 1 of the Theft Act 1968 describes it as a "basic definition"
of theft. Sections 1(1) and (2) provide:
1.-(1) A person is guilty of theft, if he dishonestly appropriates property belonging to
another with the intention of permanently depriving the other of it; and "thief" and "steal"
shall be construed accordingly.
(2) It is immaterial whether the appropriation is made with a view to gain, or is made for
the thief’s own benefit.
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Sections 2 to 6 of the Theft Act 1968 have effect as regards the interpretation and
operation of section 1 of that Act. Except as otherwise provided by that Act, sections 2
to 6 of that Act apply only for the purposes of section 1 of that Act.
Appropriates
Section 3 provides:
(1) Any assumption by a person of the rights of an owner amounts to an appropriation,
and this includes, where he has come by the property (innocently or not) without
stealing it, any later assumption of a right to it by keeping or dealing with it as owner.
(2) Where property or a right or interest in property is or purports to be transferred for
value to a person acting in good faith, no later assumption by him of rights which he
believed himself to be acquiring shall, by reason of any defect in the transferor’s title,
amount to theft of the property.
Property
Section 4(1) provides that:
"Property" includes money and all other property, real or personal, including things in
action and other intangible property.
Edward Griew said that section 4(1) could, without changing its meaning, be reduced,
by omitting words, to:
"Property" includes … all … property.
Sections 4(2) to (4) provide that the following can only be stolen under certain
circumstances:
Land or things forming part of land and severed from it (s. 4(2))
Mushrooms growing wild on any land, or the flowers, fruit or foliage of plants
growing wild on any land (s. 4(3))
Wild creatures or the carcases of wild creatures (s. 4(4))
Intangible property
Confidential information and trade secrets are not property within the meaning of
section 4.
The words "other intangible property" include export quotas that are transferable for
value on a temporary or permanent basis.
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Electricity
Electricity cannot be stolen. It is not property within the meaning of section 4 and is not
appropriated by switching on a current. Cf. the offence of abstracting electricity under
section 13.
Belonging to Another
Section 5 "belonging to another" requires a distinction to be made between ownership,
possession and control:
ownership is where a person is not legally accountable to anyone else for the use
of the property:
possession is where a person is only accountable to the owner for the use of the
property; and
control is where a person is only accountable to two people for the use of the
property.
So if A buys a car for cash, A will be the owner. If A then lends the car to B Ltd (a
company), B Ltd will have possession. C, an employee of B Ltd then uses the car and
has control. If C uses the car in an unauthorized way, C will steal the car from A and B
Ltd. This means that it is possible to steal one's own property.
In R v Turner, the owner removed his car from the forecourt of a garage where it had
been left for collection after repair. He intended to avoid paying the bill. There was an
appropriation of the car because it had been physically removed but there were two
issues to be decided:
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did the car "belong to another"? The garage had a lien i.e. a "proprietary right or
interest" in the car as security for the unpaid bill and this gave the garage a better
right than the owner to possess the car at the relevant time.
what was the relevance of Turner's belief that he could not steal his own
property? The defence of mistake of law only applies if the defendant honestly
believes that he has a right in law to act in the given way. Generalized and nonspecific
beliefs about what the law might permit are not a defense.
With The Intention of Permanently Depriving The Other of It
Section 6 "with the intent to permanently deprive the other of it" is sufficiently flexible to
include situations where the property is later returned. For example, suppose that B, a
keen football fan, has bought a ticket for the next home match. T takes the ticket,
watches the match and then returns the ticket to B. In this instance, all that T returns is
a piece of paper. Its value as a license to enter the stadium on a particular day has
been permanently lost. Hence, T steals the ticket.
Similarly, if T takes a valuable antique but later repents and returns the goods, T has
committed the actus reus with the mens rea. The fact that T's conscience forces a
change of mind is relevant only for sentencing.
Alternative Verdict
The offense created by section 12(1) of the Theft Act 1968 (TWOC) is available an
alternative verdict on an indictment for theft.
Visiting forces
Theft is an offence against property for the purposes of section 3 of the Visiting Forces
Act 1952.
Mode of Trial and Sentence
Theft is triable either way. A person guilty of theft is liable, on conviction on indictment,
to imprisonment for a term not exceeding seven years, or on summary conviction to
imprisonment for a term not exceeding six months, or to a fine not exceeding the
prescribed sum, or to both.
Aggravated Theft
The only offence of aggravated theft is robbery, contrary to section 8 of the Theft Act
1968.
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Stolen Goods
For the purposes of the provisions of the Theft Act 1968 which relate to stolen goods,
goods obtain in England or Wales or elsewhere by blackmail or fraud are regarded as
stolen, and the words "steal", "theft" and "thief" are construed accordingly.
Sections 22 to 24 and 26 to 28 of the Theft Act 1968 contain references to stolen goods.
Handling stolen goods
The offence of handling stolen goods, contrary to section 22(1) of the Theft Act 1968,
can only be committed "otherwise than in the course of stealing".
Similar or Associated Offences
According to its title, the Theft
theft and similar or associated
1978.
Act 1968 revises the law as to
offences. See also the Theft Act
Northern Ireland
In Northern Ireland, theft is a
statutory offence, created by
section 1 of the Theft Act (Northern Ireland) 1969.
United States
In the United States, plenary regulation of theft exists only at
the state level, in the sense that most thefts by default will be
prosecuted by the state in which the theft occurred. The federal
government has criminalized certain narrow categories of theft which
directly affect federal agencies or interstate commerce. The Model Penal Code includes
categories of theft by unlawful taking or by unlawfully disposing of property, theft by
deception (fraud), theft by extortion, theft by failure to take measures to return lost or
mislaid or mistakenly delivered property, theft by receipt of stolen property, theft by
failing to make agreed disposition of received funds, and theft of services.
Although many U.S. states have retained larceny as the primary offense, [40] some have
now adopted theft provisions.
Grand theft, also called grand larceny, is a term used throughout the United States
designating theft that is large in magnitude or serious in potential penological
consequences. Grand theft is contrasted with petty theft, also called petit theft, that is
of smaller magnitude or lesser seriousness.
Theft laws, including the distinction between grand theft and petty theft for cases falling
within its jurisdiction, vary by state. This distinction is established by statute, as are the
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penological consequences. Most commonly, statutes establishing the distinction
between grand theft and petty theft do so on the basis of the value of the money or
property taken by the thief or lost by the victim, with the dollar threshold for grand theft
varying from state to state. Most commonly, the penological consequences of the
distinction include the significant one that grand theft can be treated as a felony, while
petty theft is generally treated as a misdemeanor.
In some states, grand theft of a vehicle may be charged as "grand theft auto" (see
motor vehicle theft for more information).
Repeat offenders who continue to steal may become subject to life imprisonment in
certain states.
Sometimes the federal anti-theft-of-government-property law 18 U.S.C. § 640 is used to
prosecute cases where the Espionage Act would otherwise be involved; the theory
being that by retaining sensitive information, the defendant has taken a 'thing of value'
from the government. For examples, see the Amerasia case and United States v.
Manning.
Alabama
When stolen property exceeds the amount of $500 it is a felony offense. If property is
less than $500, then it is a Class A misdemeanor. Unlike some other states, shoplifting
is not defined by a separate statute but falls under the state's general theft statute.
Alaska
The Alaska State Code does not use the terms "grand theft" or "grand larceny."
However, it specifies that theft of property valued at more than $1,000 is a felony
whereas thefts of lesser amounts are misdemeanors. The felony categories (class 1
and class 2 theft) also include theft of firearms; property taken from the person of
another; vessel or aircraft safety or survival equipment; and of access devices.
Arizona
Felony theft is committed when the value of the stolen property exceeds $1000.
Regardless of the value of the item, if it is a firearm or an animal taken for the purpose
of animal fighting, then the theft is a Class 6 Felony.
California
The Theft Act of 1927 consolidated a variety of common law crimes into theft. The state
now distinguishes between two types of theft, grand theft and petty theft. The older
crimes of embezzlement, larceny, and stealing, and any preexisting references to them
now fall under the theft statute.
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There are a number of criminal statutes in the California Penal Code defining grand
theft in different amounts. Grand theft generally consists of the theft of something of
value over $950 (including money, labor or property but is lower with respect to various
specified property), Theft is also considered grand theft when more than $250 in crops
or marine life forms are stolen, “when the property is taken from the person of another,”
or when the property stolen is an automobile, farm animal, or firearm.
Petty theft is the default category for all other thefts.
Grand theft is punishable by up to a year in jail or prison, and may be charged
(depending upon the circumstances) as a misdemeanor or felony, while petty theft is a
misdemeanor punishable by a fine or imprisonment not exceeding six months in jail or
both.
Florida
In general, any property taken that carries a value of more than $300 can be considered
grand theft in certain circumstances.
Georgia
In Georgia, when a theft offense involves property valued at $500 or less, the crime is
punishable as a misdemeanor.
Any theft of property determined to be exceeding $500 may be treated as grand theft
and charged as a felony.
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Hawaii
Theft in the first or second degree is a felony. Theft in the first degree means theft
above $20,000 or of a firearm or explosive; or theft over $300 during a declared
emergency. Theft in the second degree means theft above $750, theft from the person
of another, or agricultural products over $100 or aqua-cultural products from an
enclosed property.
Illinois
Theft is a felony if the value of the property exceeds $300 or the property is stolen from
the person of another. Thresholds at $10,000, $100,000, and $500,000 determine how
severe the punishment can be. The location from which property was stolen is also a
factor in sentencing.
Kentucky
KRS 514.030 states that theft by unlawful taking or disposition is generally a Class A
misdemeanor unless the items stolen are a firearm, anhydrous ammonia, a controlled
substance valued at less than $10,000 or any other item or combination of items valued
$500 or higher and less than $10,000 in which case the theft is a Class D felony.
Theft of items valued at $10,000 or higher and less than $1,000,000 is a Class C felony.
Theft of items valued at $1,000,000 or more is a Class B felony, as is first offense theft
of anhydrous ammonia for the express purpose of manufacturing methamphetamines in
violation of KRS 218A.1432. In the latter case, subsequent offenses are a Class A
felony.
Massachusetts
In Massachusetts, theft may generally be charged as a felony alue of stolen property is
greater than $250.
Missouri
Stealing is a felony if the value of stolen property exceeds $500. It is also a felony if
“The actor physically takes the property appropriated from the person of the victim” or
the stolen property is a vehicle, legal document, credit card, firearm, explosive, U.S. flag
on display, livestock animal, fish with value exceeding $75, captive wildlife, controlled
substance, or ammonia.
Stealing in excess of $25,000 is usually a class B felony (sentence: 5–15 years), while
any other felony stealing (not including the felonies of burglary or robbery) that does not
involve chemicals is a class C felony (sentence: up to 7 years). Non-felony stealing is a
class A misdemeanor (sentence: up to 1 year).
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New York
Grand larceny consists of stealing property with a value exceeding $1000; or stealing a
public record, secret scientific material, firearm, credit or debit card, ammonia,
telephone with service, or motor vehicle or religious item with value exceeding $100; or
stealing from the person of another or by extortion or from an ATM.
The degree of grand larceny is increased if the theft was from an ATM, through
extortion involving fear, or involved a value exceeding the thresholds of $3,000,
$50,000, or $1,000,000.
Vermont
Grand Larceny: Value of goods exceed $900 (13 V.S.A. § 2501)
Virginia
Grand Larceny: Value of goods exceed $200 (Virginia Code § 18.2-95)
Washington State
Theft of goods valued between $750 and $5000 is second-degree theft, a Class C
felony. Theft of goods valued above $5000, of a search-and-rescue dog on duty, of
public records from a public office or official, of metal wire from a utility, or of an access
device, is a Class B felony, as is theft of a motor vehicle or a firearm.
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Australia
Actus reus
Victoria
Theft is defined in the Crimes Act 1958 (Vic) as when a person "dishonestly
appropriates property belonging to another with the intention of permanently depriving
the other of it.". The actus reus and mens rea are defined as follows: Appropriation is
defined in section 73(4) of the Crimes Act 1958 (Vic) as the assumption of any of the
owners rights. It does not have to be all the owner's rights, as long as at least one right
has been assumed. If the owner gave their consent to the appropriation there cannot be
an appropriation. However, if this consent is obtained by deception, this consent is
vitiated.
Property – defined in section 71(1) of the Crimes Act 1958 (Vic) as being both tangible
property, including money and intangible property. Information has been held not be
property.
Belonging to another – section 73(5) of the Crimes Act 1958 (Vic) provides that property
belongs to another if that person has ownership, possession, or a proprietary interest in
the property. Property can belong to more than one person. sections 73(9) & 73(10)
deal with situations where the accused receives property under an obligation or by
mistake.
South Australia
Theft is defined in section 134 of the Criminal Consolidation Act 1935 (SA) as being
where a person deals with property dishonestly, without the owners consent and
intending to deprive the owner of their property, or make a serious encroachment on the
proprietary rights of the owner.
Under this law, encroachment on proprietary rights means that the property is dealt with
in a way that creates a substantial risk that the property will not be returned to the
owner, or that the value of the property will be greatly diminished when the owner does
get it back.
Also, where property is treated as the defendants own property to dispose of,
disregarding the actual property owner's rights.
For a basic offence, a person found guilty of this offence is liable for imprisonment of up
to 10 years.
For an aggravated offence, a person found guilty of this offence is liable for
imprisonment of up to 15 years.
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Mens Rea
Victoria
Intention to permanently deprive – defined at s.73(12) as treating property as it belongs
to the accused, rather than the owner.
Dishonestly – section 73(2) of the Crimes Act 1958 (Vic) creates a negative definition of
the term 'dishonestly'. The section deems only three circumstances when the accused
is deemed to have been acting honestly. These are a belief in a legal claim of right, a
belief that the owner would have consented, or a belief the owner could not be found.
South Australia
Whether a person's conduct is dishonest is a question of fact to be determined by the
jury, based on their own knowledge and experience. As with the definition in Victoria, it
contains definitions of what is not dishonesty, including a belief in a legal claim of right
or a belief the owner could not be found.
West Indies
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In the British West Indies, especially Grenada, there have been a spate of large-scale
thefts of tons of sand from beaches. Both Grenada and Jamaica are considering
increasing fines and jail time for the thefts.
Islam
Religious Views and Practices
In parts of the world which govern with sharia law, the punishment for theft is
amputation of the right hand if the thief does not repent. This ruling is derived from sura
5 verse 38 of the Quran which states As to the thief, Male or female, cut off his or her
hands: a punishment by way of example, from Allah, for their crime: and Allah is Exalted
in power. This is viewed as being a deterrent.
Buddhism
In Buddhism, one of the five precepts prohibits theft, and involves the intention to steal
what one perceives as not belonging to oneself ("what is not given") and acting
successfully upon that intention. The severity of the act of theft is judged by the worth of
the owner and the worth of that which is stolen. Underhand dealings, fraud, cheating
and forgery are also included in this precept. Professions that are seen to violate the
precept against theft are working in the gambling industry or marketing products that are
not actually required for the customer.
Psychology
Possible causes for acts of theft include both economic and non-economic motivations.
For example, an act of theft may be a response to the offender's feelings of anger, grief,
depression, anxiety and compulsion, boredom, power and control issues, low selfesteem,
a sense of entitlement, an effort to conform or fit in with a peer group, or
rebellion. Theft from work may be attributed to factors that include greed, perceptions of
economic need, support of a drug addiction, a response to or revenge for work-related
issues, rationalization that the act is not actually one of stealing, response to
opportunistic temptation, or the same emotional issues that may be involved in any
other act of theft.
The most common reasons for shoplifting include participation in an organized
shoplifting ring, opportunistic theft, compulsive acts of theft, thrill-seeking, and theft due
to need. Studies focusing on shoplifting by teenagers suggest that minors shoplift for
reasons including the novelty of the experience, peer pressure, the desire to obtain
goods that a minor cannot legally purchase, and for economic reasons, as well as selfindulgence
and rebellion against parents.
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XIX. Witness Tampering
and Intimidation
Witness Tampering is the act of attempting to alter or prevent the testimony of
witnesses within criminal or civil proceedings. Laws regarding witness tampering also
apply to proceedings before the U.S. Congress, executive departments, and
administrative agencies. To be charged with witness tampering in the United States, the
attempt to alter or prevent testimony is sufficient. There is no requirement that the
intended obstruction of justice be completed.
In situations where intimidation or retaliation against witnesses is likely (such as cases
involving organized crime), witnesses may be placed in witness protection to prevent
suspects or their colleagues from intimidating or harming them.
In the United Kingdom, witness intimidation is covered by Criminal Justice and Public
Order Act 1994, section 51. Under this act it is an offence to perform an act which is
intended to and does intimidate a person who the offender knows or believes to be
involved with a criminal case with the intention of disturbing the proceedings.
United States
In the United States, the crime of witness tampering in federal cases is defined by
statute at 18 U.S.C. § 1512, which defines it as "tampering with a witness, victim, or an
informant." The punishment for such an offense is up to 20 years if physical force was
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used, attempted, or threatened. The tampering need not have actually been successful
in order for it to be criminal.
One of the better known cases involving Section 1512 is Arthur Andersen LLP v. United
States, decided by the U.S. Supreme Court in May 2005. The Supreme Court ruled that
Section 1512 had been misinterpreted by the Fifth Circuit Court of Appeals, and
reversed the decision of the lower court which had found the firm guilty of violating the
section. The issue had, to some extent, become moot, because in 2002 the firm had all
but dissolved as a result of prosecution on this criminal charge.
Examples of witness tampering include American politicians Buddy Cianci, Meg Scott
Phipps and Ted Klaudt, convicted in 2001, 2003 and 2007, respectively.
England and Wales
In England and Wales, witness intimidation by unlawful means, such as violence,
bribery, threats, or improper pressure, is known as Perverting the course of justice.
Section 51 of the Criminal Justice and Public Order Act 1994 includes the offences of
intimidating a witness and taking revenge on a witness.
Kosovo
By prosecutors
A current source of controversy is the lack of penalties for prosecutors who commit
witness tampering or other forms of prosecutorial misconduct. In the United States,
prosecutors have full immunity from civil liability regardless of how egregious their
actions may be. However, prosecutors do not have immunity from criminal proceedings
and can be professionally censured, but studies demonstrate that this rarely happens.
In March 2003, the U.S. Fifth Circuit Court of Appeals, ruled against a man named
Shareef Cousin, who filed a lawsuit against New Orleans prosecutors after he was
wrongfully convicted of the 1995 murder of Michael Gerardi. A number of examples of
witness tampering during the trial were uncovered. In court, a friend of Cousin's was
expected to testify for the prosecution that Cousin had confessed to him. Instead, he
told jurors that he had been promised leniency in his own trial if he would falsely
implicate Cousin for the murder.
An eyewitness then testified that she saw Cousin commit the murder. Her original
statement to police indicated that she had very poor vision and could not identify the
killer. Her statements regarding her vision were not disclosed to the defense. Cousin
also accused the state of illegally detaining many of his witnesses to prevent them from
testifying in his defense.
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Intimidation
Intimidation (also called cowing) is intentional behavior that "would cause a person of
ordinary sensibilities" to fear injury or harm. It is not necessary to prove that the
behavior was so violent as to cause mean terror or that the victim was actually
frightened.
Threat, criminal threatening (or threatening behavior) is the crime of intentionally or
knowingly putting another person in fear of bodily injury. "Threat of harm generally
involves a perception of injury...physical or mental damage...act or instance of injury, or
a material and detriment or loss to a person." "A terroristic threat is a crime generally
involving a threat to commit violence communicated with the intent to terrorize other."
"Intimidation" is the name of a criminal offense in several U.S. states.
Description
Threatening behaviors may be conceptualized as a maladaptive outgrowth of normal
competitive urge for inter-relational dominance generally seen in animals. Alternatively,
intimidation may result from the type of society in which individuals are socialized, as
human beings are generally reluctant to engage in confrontation or threaten violence.
Like all behavioral traits, it exists in greater or lesser manifestation in each individual
person over time, but may be a more significant "compensatory behavior" for some as
opposed to others. Behavioral theorists often see threatening behaviors as a
consequence of being threatened by others, including parents, authority figures,
playmates and siblings. "Use of force is justified when a person reasonably believes that
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it is necessary for the defense of oneself or another against the immediate use of
unlawful force."
Intimidation may be employed consciously or unconsciously, and a percentage of
people who employ it consciously may do so as the result of selfishly rationalized
notions of its appropriation, utility or self-empowerment. Intimidation related to prejudice
and discrimination may include conduct "which annoys, threatens, intimidates, alarms,
or puts a person in fear of their safety...because of a belief or perception regarding such
person's race, color, national origin, ancestry, gender, religion, religious practice, age,
disability or sexual orientation, regardless of whether the belief or perception is correct."
Intimidation may be manifested in such manner as physical contacts, glowering
countenance, emotional manipulation, verbal abuse, making someone feel lower than
you, purposeful embarrassment and/or actual physical assault. "Behavior may include,
but is not limited to, epithets, derogatory comments or slurs and lewd propositions,
assault, impeding or blocking movement, offensive touching or any physical interference
with normal work or movement, and visual insults, such as derogatory posters or
cartoons."
United States
As a Criminal Offense
"Intimidation" is the name of a criminal offense in several U.S. states. The definitions of
the crime of Intimidation differ by state.
In Montana, Intimidation is defined as follows:
45-5-203. Intimidation.
(1) A person commits the offense of intimidation when, with the purpose to cause
another to perform or to omit the performance of any act, the person communicates to
another, under circumstances that reasonably tend to produce a fear that it will be
carried out, a threat to perform without lawful authority any of the following acts:
(a) inflict physical harm on the person threatened or any other person;
(b) subject any person to physical confinement or restraint; or
(c) commit any felony.
(2) A person commits the offense of intimidation if the person knowingly communicates
a threat or false report of a pending fire, explosion, or disaster that would endanger life
or property.
(3) A person convicted of the offense of intimidation shall be imprisoned in the state
prison for any term not to exceed 10 years or be fined an amount not to exceed
$50,000, or both.
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Several states have a crime called "Ethnic intimidation". For instance, the law of the
state of Michigan reads:
750.147b Ethnic intimidation.
Sec. 147b.
(1) A person is guilty of ethnic intimidation if that person maliciously, and with specific
intent to intimidate or harass another person because of that person's race, color,
religion, gender, or national origin, does any of the following:
(a) Causes physical contact with another person.
(b) Damages, destroys, or defaces any real or personal property of another
person.
(c) Threatens, by word or act, to do an act described in subdivision (a) or (b), if
there is reasonable cause to believe that an act described in subdivision (a) or
(b) will occur.
(2) Ethnic intimidation is a felony punishable by imprisonment for not more than 2 years,
or by a fine of not more than $5,000.00, or both.
(3) Regardless of the existence or outcome of any criminal prosecution, a person who
suffers injury to his or her person or damage to his or her property as a result of ethnic
intimidation may bring a civil cause of action against the person who commits the
offense to secure an injunction, actual damages, including damages for emotional
distress, or other appropriate relief. A plaintiff who prevails in a civil action brought
pursuant to this section may recover both of the following:
(a) Damages in the amount of 3 times the actual damages described in this
subsection or $2,000.00, whichever is greater.
(b) Reasonable attorney fees and costs.
Crimes closely related to intimidation are menacing, coercion, terrorizing, and
assault.
In California, making criminal threats is a wobbler and may be charged as either a
misdemeanor or a felony under California Penal Code 422. A felony criminal threat is a
strike under California's three strikes law.
As a Civil Offense
United States
Intimidation can also be a civil offense, in addition to a criminal offense, in some U.S.
states. For example, in Oregon a violation of the state criminal statute for intimidation
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esults in a civil violation. The plaintiff in the civil suit for intimidation may then secure
remedies including an injunction or special and general damages.
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XX. Transnational Crime
Transnational Crimes are crimes that have actual or potential effect across national
borders and crimes that are intrastate but offend fundamental values of the international
community. The term is commonly used in the law enforcement and academic
communities. Transnational organized crime (TOC) refers specifically to transnational
crime carried out by crime organizations.
The word transnational describes crimes that are not only international (that is, crimes
that cross borders between countries), but crimes that by their nature involve crossborder
transference as an essential part of the criminal activity. Transnational crimes
also include crimes that take place in one country, but their consequences significantly
affect another country and transit countries may also be involved.
Examples of transnational crimes include: human trafficking, people smuggling,
smuggling/trafficking of goods (such as arms trafficking and drug trafficking and illegal
animal and plant products and other goods prohibited on environmental grounds (e.g.
banned ozone depleting substances), sex slavery, terrorism offences, torture and
apartheid.
Transnational crimes may also be crimes of customary international law or international
crimes when committed in certain circumstances. For example, they may in certain
situations constitute crimes against humanity.
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In Failed or Failing States
The international community is confronted with an increasing level of transnational
crime in which criminal conduct in one country has an impact in another or even several
others. Drug trafficking, human trafficking, computer crimes, terrorism, and a host of
other crimes can involve actors operating outside the borders of a country which might
have a significant interest in stemming the activity in question and prosecuting the
perpetrator. Contemporary transnational crimes take advantage of globalization, trade
liberalization and exploding new technologies to perpetrate diverse crimes and to move
money, goods, services and people instantaneously for purposes of perpetrating
violence for political ends.
Moreover, problems of weakened states and transnational crime create an unholy
confluence that is uniquely challenging. When a criminal operates outside the territory of
an offended state, the offended state might ordinarily appeal to the state from which the
criminal is operating to take some sort of action, such as to prosecute the offender
domestically or extradite the offender so that he or she may face punishment in the
offended state. Nonetheless, in situations in which a government is unable (or unwilling)
to cooperate in the arrest or prosecution of a criminal, the offended state has few
options for recourse. [3]
International Cooperation
Given the limits on the exercise of extraterritorial enforcement jurisdiction, states have
developed mechanisms to cooperate in transnational criminal matters. The primary
mechanisms used in this regard are extradition, lawful removal, and mutual legal
assistance.
Extradition is the mechanism by which one sovereign requests and obtains custody of a
fugitive located within the jurisdiction and control of another sovereign. It is an ancient
mechanism, dating back to at least the thirteenth century BCE, when an Egyptian
Pharaoh negotiated an extradition treaty with a Hittite King. Through the extradition
process, a sovereign (the requesting state) typically makes a formal request to another
sovereign (the requested state). If the fugitive is found within the territory of the
requested state, then the requested state may arrest the fugitive and subject him or her
to its extradition process. The extradition procedures to which the fugitive will be
subjected are dependent on the law and practice of the requested state.
Aside from mechanisms for the return of fugitives, states have also developed
mechanisms for requesting and obtaining evidence for criminal investigations and
prosecutions. When evidence or other forms of legal assistance, such as witness
statements or the service of documents, are needed from a foreign sovereign, states
may attempt to cooperate informally through their respective police agencies or,
alternatively, resort to what is typically referred to as requests for "mutual legal
assistance" [3] The practice of mutual legal assistance developed from the comity-based
system of letters rogatory, though it is now far more common for states to make mutual
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legal assistance requests directly to the designated "Central Authorities" within each
state. In contemporary practice, such requests may still be made on the basis of
reciprocity but may also be made pursuant to bilateral and multilateral treaties that
obligate countries to provide assistance. Many countries are able to provide a broad
range of mutual legal assistance to other countries even in the absence of a treaty.
Torture
There can be few issues on which international legal opinion is more clear than on the
condemnation of torture. Offenders have been recognized as the "common enemies of
mankind"
— Lord Bingham
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Page 302 of 372

XXI. Criminal Enterprises, Gangs
and Syndicates
This is a listing of enterprises, gangs, mafias and syndicates that are involved in
organized crime. Tongs and outlaw motorcycle gangs, as well as terrorist, militant, and
paramilitary groups are mentioned if they are involved in criminal activity for funding.
However, since their stated aim and genesis is often ideological rather than commercial,
they are distinct from mafia-type groups.
Drug Cartels
In several drug-producing or transit countries, drug traffickers have taken advantage of
local corruption and lack of law enforcement to establish cartels turning in millions if not
billions of dollars each year. Sometimes if government enforcement is particularly poor,
the cartels become quasi-paramilitary organizations.
Latin America
Dominican drug cartels
o Paulino organization
o Féliz organization
Bolivian drug cartels (See also García Meza regime drug trafficking)
o La Corporación
o Santa Cruz cartel
Nicaraguan drug cartels (see also Contras)
o Oscar Danilo Blandón
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Peruvian drug cartels (see also Shining Path and Vladimiro Montesinos)
o Zevallos organisation
Honduran drug cartels
o Matta organization
o Cachiros
Venezuelan drug cartels (see also Colectivos)
o Cartel of the Suns
Colombia
Active
Bandas criminales (See also Paramilitarism in Colombia)
o Clan del Golfo
The Office of Envigado
Defunct
Medellín Cartel (See also Muerte a Secuestradores)
o
• Miami branch
Cali Cartel (see also Los Pepes)
Norte del Valle Cartel
North Coast Cartel
Leticia Cartel
Los Rastrojos
New Generation
Los Nevados
Los Machos
Popular Revolutionary Antiterrorist Army of Colombia
Bloque Meta
Libertadores del Vichada
Black Eagles
Mexico
Sinaloa Cartel
o Milenio Cartel (defunct)
o Colima Cartel (defunct)
o Artistas Asesinos (defunct)
o Gente Nueva
o Jalisco New Generation Cartel
o Los Ántrax
Gulf Cartel
o Los Rojos
o Los Metros
Page 304 of 372

Los Zetas
o Guatemala branch (defunct)
Knights Templar Cartel
La Familia Michoacana (defunct)
o La Resistencia (defunct)
Juárez Cartel (disbanded)
o La Linea
Tijuana Cartel (disbanded)
o Oaxaca Cartel (defunct)
o Los Santos street gang
Guadalajara Cartel (defunct)
o Sonora Cartel (defunct)
Beltrán-Leyva Cartel (defunct)
o Los Negros (defunct)
o Los Pelones (defunct)
o Los Mazatlecos (still active)
o Guerreros Unidos (still active)
o South Pacific Cartel (defunct)
o Independent Cartel of Acapulco (defunct)
o La Barredora (defunct)
Los Narcosatánicos (defunct)
Asia
Golden Triangle
o Burmese drug cartels(see also Myanmar Nationalities Democratic Alliance
Army)
• Khun Sa cartel (see also Mong Tai Army)
• Red Wa Cartel (see also United Wa State Army and National
Democratic Alliance Army)
• Hawngleuk Militia
• Han cartel
o Laotian drug cartels (see also Ouane Rattikone)
Golden Crescent
o Afridi Network
o Afghan drug cartels (see also Taliban)
• Noorzai Organization
• Khan organization
• Karzai organization (alleged)
• Bagcho organization
• Haqqani Network
Page 305 of 372

North American Organized Crime
Canada
Rivard organization
Red Scorpions
Bacon Brothers
West End Gang
Dubois Brothers
Indo-Canadian organized crime
o Punjabi Mafia जोहल गिरोह (Canada)
Canadian mafia families
o
o
o
o
o
o
o
o
o
Rizzuto crime family
Cuntrera-Caruana Mafia clan
Cotroni crime family
Musitano crime family
Papalia crime family
Perri crime family
Siderno Group
Commisso 'ndrina
Luppino crime family
United States
National Crime Syndicate
o Seven Group
o Murder, Inc.
Prohibition-era gangs
o Galveston
• Downtown Gang
• Beach Gang
• The Maceo syndicate
o Broadway Mob
o The Lanzetta Brothers
o Shelton Brothers Gang
o Sheldon Gang
o Circus Cafe Gang
o Wandering Family
Polish Mob
o Saltis-McErlane Gang
o Kielbasa Posse
o The Greenpoint Crew
o Flats Mob
o The Flathead gang
Page 306 of 372

Dixie Mafia
o Cornbread Mafia
o State Line Mob
Wall gang
Greek-American organized crime
o Philadelphia Greek Mob
o Velentzas Family
Hispanic-American
o Marielitos
• The Corporation
o Puerto Rican mafia
• Agosto organization
• La ONU
• Solano organization
• Negri organization
• Márquez gambling ring
o Polanco-Rodriguez organization
Assyrian/Chaldean mafia
Hawaii
o The Company
o Leota mob
Los Angeles
o Nash gang
o Wonderland Gang
Elkins mob
Binion mob
Page 307 of 372

American Mafia
Italian immigrants to the United States in the early 20th century formed various smalltime
gangs which gradually evolved into sophisticated crime syndicates which
dominated organized crime in America for several decades. Although government
crackdowns and a less-tightly knit Italian-American community have largely reduced
their power, they remain an active force in the underworld
Active
The Commission
The Five Families of New York City
o Bonanno
• Indelicato crew
• The Motion Lounge Crew
o Colombo
• Scarpa crew
o Genovese
• 116th Street Crew
• Greenwich Village Crew
• New Jersey Crew
o Gambino
• Ozone Park Boys
• DeMeo crew
• Baltimore Crew
• South Florida faction
• New Jersey faction
• The Bergin Crew
• Cherry Hill Gambinos
o Lucchese
• The Jersey Crew
• The Vario Crew
• 107th Street gang
Magaddino crime family
DeCavalcante crime family
The Chicago Outfit
o Las Vegas crew (defunct)
Philadelphia crime family
Pittsburgh crime family
Patriarca crime family
o Angiulo Brothers crew
Cleveland crime family
Los Angeles crime family
Kansas City crime family
Trafficante crime family
Detroit Partnership
Page 308 of 372

Milwaukee crime family
New Orleans crime family
Defunct
Morello crime family
Genna crime family
Porrello crime family
St. Louis crime family
Rochester Crime Family
Bufalino crime family
Dallas crime family
Denver crime family
San Francisco crime family
San Jose crime family
Seattle crime family
Omaha crime family
Licavoli Mob
Cardinelli gang
New York Camorra
East Harlem Purple Gang
Jewish Mafia
New York City
o The Bugs and Meyer Mob
o Kaplan gang
o Rosenzweig gang
o Rothstein organization
o Schultz gang
o Shapiro Brothers
o Yiddish Black Hand
o Epstein-Wolmark gang
Boston
o 69th Street Gang
o Sagansky organization
o Solomon organization
Los Angeles
o Cohen crime family (mix between Jewish and Italian members)
The Purple Gang
Zwillman gang
Kid Cann's gang
Birger mob
Cleveland Syndicate
Page 309 of 372

African-American Organized Crime
Certain members of the Black Panther Party, particularly the Oakland chapter, also
engaged in criminal activities such as drug dealing and extortion.
New York City
o The Council
o Harlem numbers racket
o Bumpy Johnson gang
o Supreme Team
o The Bebos
o The Country Boys
o Matthews Organization
The Family
Detroit
o Black Mafia Family
o Young Boys, Inc.
o Chambers Brothers
Philadelphia
o Black Mafia
o Junior Black Mafia
Oakland, California
o 69 Mob
Baltimore
o
Williams organization (drug trafficking)
Washington, D.C.
o
Chicago
o
o
Atlantic City
o
Rayful Edmond organization
Theodore Roe's gambling ring
Stokes organization
Aso Posse
Miami
o Miami Boys
Rosemond Organization
Irish Mob
Prohibition-era Chicago gangs
o North Side Gang
o James Patrick O'Leary organization
o John Patrick Looney gang
o Valley Gang
o Ragen's Colts
o Touhy gang
o Enright gang
Page 310 of 372

Boston
o Mullen Gang
o Winter Hill Gang
o Gustin Gang
o Charlestown Mob
o Killeen gang
Danny Hogan's gang
Danny Walsh gang
Tom Dennison empire
Nucky Johnson's Organization
Danny Greene's Celtic Club
K&A Gang
New York
o Dwyer gang
o White Hand Gang
o Higgins gang
o The Westies
St Louis
o Hogan Gang
o Egan's Rats
European Organized Crime
Organized crime in Sweden
o Original Gangsters
o Fucked For Life
o Uppsala mafia
o Chosen Ones
o Werewolf Legion
o Asir
o Vårvädersligan
Dutch 'Penose'
o Bruinsma drug gang
o Holleeder gang
o Mieremet gang
o Riphagen gang (WWII-era)
o Hopi Boys
French Milieu
o Corsican mafia
• Unione Corse
• Carbone crime family
• Francisci crime family
• Mondoloni crime family
• Brise de Mer gang
o Les Caïds Des Cités
• Faïd gang
Page 311 of 372

o
o
o
o
• The Barbarians
Wigs gang
North African Brigade
Tractions Avant gang
Bande des Trois Canards
Greece
o Greek mafia
Ireland (See also Irish Republican Army)
o Dublin
• Cahill gang
• Gilligan gang
• Foley gang
• Hyland gang
• Dunne gang
• The Westies
o Limerick
• McCarthy-Dundon
• Keane-Collopy
o Rathkeale Rovers
o Kinahan gang
Spain
o
Galician mafia
Poland
o Pruszków mafia
Slovak mafia
Romani clans
o El Clan De La Paca
o Raffael clan
o Sztojka clan
o Rashkov clan
o French gypsy gangs
• Hornec gang
Czech Republic
o Mrázek organization
o Krejčíř organization
The Belgian Milieu
o 'Hormone mafia'
o Milieu Liègeois
Page 312 of 372

Italian Organized Crime
Organized crime in Italy, especially the south, has existed for hundreds of years and
has given rise to a number of notorious organizations with their own traditions and
subculture which have managed to infiltrate almost every part of Italian society. The
Italian mafia is often thought of as being the archetype for organized crime worldwide.
Sicilian Mafia
• Cuntrera-Caruana Mafia clan
• Sicilian Mafia Commission
• Inzerillo Mafia clan
• Mandamenti
• Corleonesi
• Greco Mafia clan
• Motisi Mafia clan
'Ndrangheta
o La Provincia
o Honoured Society (Melbourne)
o Mammoliti 'ndrina
o Bellocco 'ndrina
o Cataldo 'ndrina
o Commisso 'ndrina
o Cordì 'ndrina
o De Stefano 'ndrina
o Pesce 'ndrina
o Barbaro 'ndrina
o Piromalli 'ndrina
o Serraino 'ndrina
o Siderno Group
Camorra
o Secondigliano Alliance
• Licciardi clan
• Contini clan
• Lo Russo clan
• Mallardo clan
o
o
o
o
o
o
o
o
Nuova Camorra Organizzata
Di Lauro Clan
Nuova Famiglia
Casalesi clan
Fabbrocino clan
Giuliano clan
Nuvoletta clan
Vollaro clan
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o
o
o
o
Scissionisti di Secondigliano
La Torre clan
Alfieri clan
Russo clan
Sacra Corona Unita
Stidda
Mala del Brenta
Basilischi
Rome
o Banda della Magliana
o Mafia Capitale
Milanese gangs
o Banda della Comasina
o Turatello crew
British Organised Crime "Firms"
London
o Adams crime family
o The Richardson Gang
o The Firm
o The Syndicate
o Comer gang
o Buttmarsh Boys
o Interwar era mobs
• Messina Brothers
• Sabini syndicate
• Hoxton Gang
• Elephant and Castle Mob
• Birmingham Boys
Essex Boys
Manchester
o Quality Street Gang
o Noonan firm
o Cheetham Hillbillies
o The Gooch Close Gang
Liverpool
o Curtis Warren's drug empire
o Whitney gang
Aggi Crew
Glasgow
o McGraw firm
o Thompson firm
o Delta Crime Syndicate
Brighton razor gangs
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Bestwood Cartel
Balkan Organized Crime
Balkan organized crime gained prominence in the chaos following the communist era,
notably the transition to capitalism and the wars in former Yugoslavia.
Albanian mafia
o Kosovan mafia
o Albania
• Gang of Çole
• Gang of Gaxhai
• Gang of Pusi i Mezinit
• Lazarat marijuana growers
o Rudaj Organization (New York City)
o Gang of Ismail Lika
o Dobroshi gang (International)
o Naserligan (Sweden)
o K-Falangen (Sweden)
Bosnian mafia
o Prazina gang
o Bajramović gang
o Delalić gang
o M-Falangen (Sweden)
Bulgarian mafia (see also Multigroup)
o VIS
o SIC
o Karamanski gang
o TIM
o Naglite
Serbian mafia
o Arkan clan
o Zemun Clan
o Joca Amsterdam gang
o Magaš clan
o Giška gang
o Pink Panthers
o Serb mafia in Scandinavia
• Kotur mob
• Yugoslav Brotherhood
Montenegrin mafia (see also allegations of Milo Đukanović's involvement in
cigarette smuggling)
Macedonian mafia
o Frankfurt mafia
o Bajrush klan
Page 315 of 372

o Nezim klan'
Romanian mafia
o Băhăian organisation
o Clanu Camataru
o Clanu Coordunenilor
o Clanu Rosianu
o Craiova Underground Killers Gang
Croatian organized crime
Post-Soviet Organized Crime
Although organized crime existed in the Soviet era, the gangs really gained in power
and international reach during the transition to capitalism. The term Russian Mafia,
'mafiya' or mob is a blanket (and somewhat inaccurate) term for the various organized
crime groups that emerged in this period from the 15 former republics of the USSR and
unlike their Italian counterparts does not mean members are necessarily of Russian
ethnicity or uphold any ancient criminal traditions, although this is the case for some
members.
Russian-Jewish mafia
o Brighton Beach
• Agron gang
• Nayfeld gang
• Balagula gang
o Mogilevich organization
Brothers' Circle (Existence is debatable)
Russian mafia
o Moscow
• Izmaylovskaya gang
• Solntsevskaya bratva
• New York branch
• Orekhovskaya gang
o St Petersburg
• Tambov Gang
o Togliatti mafia
o Uralmash gang
o The Family
o Lazovsky gang
o Vladivostok gang
o Kurganskaya group
o Tsapok gang
o 'Elephants' group
o Kazan gang
o A.U.E.
Page 316 of 372

Ukrainian mafia
o Donetsk Clan
o Salem gang
o Mukacheve cigarette smuggling syndicate
Lithuanian mafia
o Vilnius Brigade
Estonian mafia
o Linnuvabriku group
Transnistrian mafia
Caucasian Crime Syndicates
Georgian mafia
o Kutaisi clan
o Tbilisi clan
o 21st Century Association
Armenian mafia
o Mirzoyan-Terdjanian organization
o Armenian Power
Azeri mafia
o Janiev organization
Chechen mafia
o Obschina
o Labazanov gang
Central Asian crime syndicates
Uzbek mafia
o Rakhimov organization
Kyrgyz mafia
o Erkinbayev group
o Akmatbayev group
o Kolbayev group
Asian Organized Crime
East Asian Criminal Organizations
Korean criminal organizations
o Jongro street gang
Japanese Yakuza
The yakuza of Japan are similar to the Italian mafias in that they originated centuries
ago and follow a rigid set of traditions, but have several aspects that make them unique,
such as their full-body tattoos and their fairly open place in Japanese society. Many
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yakuza groups are umbrella organizations, smaller gangs reporting to a larger crime
syndicate.
Active Yakuza Groups
Roku-daime Yamaguchi-gumi 六 代 目 山 口 組
o Yoshitomi Group
o Yon-daime Yamaken-gumi 四 代 目 山 健 組
o Ni-daime Kodo-kai 二 代 目 弘 道 会
o Ni-daime Takumi-gumi 二 代 目 宅 見 組
o Go-daime Kokusui-kai 五 代 目 國 粹 会
Inagawa-kai 稲 川 会
Sumiyoshi-kai 住 吉 会
o Sumiyoshi-ikka Shinwa-kai 住 吉 一 家 親 和 会
• Kansuke Juni-daime 勘 助 十 二 代 目
Kobe Yamaguchi-gumi
Matsuba-kai 松 葉 会
Kyokuto-kai 極 東 会
Dojin-kai [60] 道 仁 会
o Kitamura-gumi
Yon-daime Kudo-kai 四 代 目 工 藤 會
Roku-daime Aizu-Kotetsu-kai 六 代 目 会 津 小 鉄 会
Okinawa Kyokuryu-kai 沖 縄 旭 琉 会
Kyushu Seido-kai 九 州 誠 道 会
Go-daime Kyosei-kai 五 代 目 共 政 会
San-daime Fukuhaku-kai 三 代 目 福 博 会
Soai-kai 双 愛 会
Yon-daime Kyokuryu-kai 四 代 目 旭 琉 会
San-daime Kyodo-kai 三 代 目 俠 道 会
Taishu-kai 太 州 会
Shichi-daime Goda-ikka 七 代 目 合 田 一 家
Toa-kai 東 亜 会
Ni-daime Azuma-gumi 二 代 目 東 組
Yon-daime Asano-gumi 四 代 目 浅 野 組
Hachi-daime Sakaume-gumi 八 代 目 酒 梅 組
Yon-daime Kozakura-ikka 四 代 目 小 桜 一 家
Ni-daime Shinwa-kai 二 代 目 親 和 会
Defunct Yakuza Groups
Kantō-kai 関 東 会
Ni-daime Honda-kai 二 代 目 本 多 会
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Yamaguchi-gumi
o Goto-gumi 後 藤 組
o Suishin-kai 水 心 会
Ichiwa-kai 一 和 会
San-daime Yamano-kai 三 代 目 山 野 会
Nakano-kai 中 野 会
Kyokuto Sakurai-soke-rengokai 極 東 桜 井 總 家 連 合 会
Triads and Other Chinese Criminal Organizations
The Triads is a popular name for a number of Chinese criminal secret societies, which
have existed in various forms over the centuries (see for example Tiandihui). However,
not all Chinese gangs fall into line with these traditional groups, as many non-traditional
criminal organizations have formed, both in China and the Chinese diaspora.
Hong Kong-based Triads
o 14K Group 十 四 K
o Wo Group 和 字 頭
• Wo Shing Wo 和 勝 和
• Wo On Lok (Shui Fong) 和 安 樂 ( 水 房 )
• Wo Hop To 和 合 圖 ( 老 和 )
o Sun Yee On 新 義 安 ( 老 新 )
o Luen Group 聯 字 頭
o Big Circle Gang 大 圈
Sio Sam Ong ( 小 三 王 )
Chinese-American gangs (See also Tongs)
o Wah Ching 華 青
o Ping On
o Black Dragons 黑 龍
o Jackson Street Boys 積 臣 街 小 子
Secret societies in Singapore
o Ang Soon Tong 昂 很 快 塘
o Ghee Hin Kongsi 酥 油 軒 懸 空 寺
o Hai San 海 新
o Wah Kee 華 記
o Ah Kong 新 加 坡 黑 手 黨
Taiwan-based Triads
o United Bamboo Gang 竹 聯 幫
o Four Seas Gang 四 海 幫
o Celestial Alliance
Mainland Chinese crime groups (see also Hanlong Group)
Page 319 of 372

o
o
o
Chongqing group 重 慶 組
Defunct
• Honghuzi gangs
• Green Gang 青 帮
Boshe group
Triads in Cholon
o Wu Bang
Southeast Asian criminal organizations
Chao pho
o Red Wa
Filipino crime gangs (See also Abu Sayyaf and New People's Army)
• Salonga Group
• Kuratong Baleleng
• Changco gang
• Putik gang
Cambodian crime gangs
o Teng Bunma organization
Indonesia
Preman (See also Pancasila Youth and insurgency in Aceh)
o Medan gang
Malaysian crime gangs
o Mamak Gang
Vietnamese Xã Hội Đen
Bình Xuyên
Đại Cathay's mafia during the 60s
Năm Cam's mafia of the 90s
Khánh Trắng's "Đồng Xuân Labor Union", a crime syndicate under the guise of a
legal entity
Dung Hà's gang
South Asian Criminal Organizations
Indian mafia
o Mumbai
• D-Company डी कं पनी
Page 320 of 372

o
o
o
o
o
• Rajan gang राजन गिरोह
• Gawli gang िवली गिरोह
• Rajan gang
• Surve gang
• Mudaliar gang
• Mastan gang
• Budesh gang
• Kalani gang
Pathan mafia
• Lala gang
Uttar Pradesh
• Ansari gang
• Yadav gang
Bangalore
• Rai gang
• Ramachandra gang
• Jayaraj gang
Kala Kaccha Gang
Chaddi Baniyan Gang
Sri Lankan Criminal Groups (See also Tamil Tigers, Eelam People's Democratic
Party and Tamil Makkal Viduthalai Pulikal)
Pakistani mafia (See also Peoples' Aman Committee, Tehrik-i-Taliban Pakistan,
Muttahida Qaumi Movement and ISI involvement with drugs)
o Chotu gang
o Lyari Gang
Mafia Raj
Dacoit gangs
o Singh gang
o Veerappan gang
o Devi gang
Middle Eastern Organized Crime
Israeli mafia (see also Stern Gang)
יל'אברג משפחת o Abergil Crime Family
פשע משפחת אלפרון o Alperon crime family
הארגון רוזנשטיין זאב o Zeev Rosenstein organization
o Palestinian organized crime ( See also Abu Nidal Organization)
• Doghmush clan
Turkish mafia
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o
o
o
o
o
Crime groups in Turkey (see also Deep state and Yüksekova Gang)
• Kilic gang
• Cakici gang
• Peker gang
• Yaprak gang
• Topal organisation
• Söylemez Gang
Kurdish mafia (see also Kurdistan Workers' Party)
• Baybasin drug organization
• Cantürk organization
Turkish organised crime in Great Britain
• Arifs
Turkish organised crime in Germany
• Arabaci clan
Imac clan (Netherlands)
Iranian organized crime (see also People's Mujahedin of Iran#Fraud and money
laundering, Jundallah and illegal activities of the IRGC)
o Tahvili crime family
Lebanese mafia (See also Lebanese Civil War militias)
o Mhallami-Lebanese crime clans
• Miri-Clan
• Al-Zein Clan
o Juomaa drug trafficking organisation (See also Hezbollah)
o Ibrahim clan
Australian Organized Crime
Sydney
o Razor gangs
o 5T gang
o Freeman gang
o The Team
o Mr Sin gang
Melbourne
o Carlton Crew
o Moran family
o Williams family
o Pettingill family
o Richmond gang
Caribbean Crime Groups
Chadee gang (Trinidad & Tobago) (see also Jamaat al Muslimeen)
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Jamaican Yardies & Posses
o Shower Posse
o POW Posse
o Tottenham Mandem
• Star Gang
o Klans Massive
No Limit Soldiers
Phantom death squad (Guyana)
Zoe Pound (Haitian, see also Tonton Macoute)
African Criminal Organisations
*Mai-Mai militia gangs
Cape Verdean organized crime
Mungiki
Nigerian organized crime
o Confraternities in Nigeria
• Black Axe Confraternity
o Anini gang
Le Roux organization
Moroccan hashish smugglers
o Ahmed organization
Cybercrime Networks
As society enters the Information Age, certain individuals take advantage of easy flow of
information over the Internet to commit online fraud or similar activities. Often the
hackers will form a network to better facilitate their activities. On occasion the hackers
will be a part of a criminal gang involved in more 'blue collar crime', but this is unusual.
ShadowCrew
Avalanche
DarkMarket
Legion of Doom
Carder.su
Tor Carding Forum
HackBB
Masters of Deception
Russian cybercrime
o
o
o
o
Russian Business Network
Anton Gelonkin internet fraud group
Leo Kuvayev internet spam group
CyberVor
Darknet markets
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o
o
o
o
o
o
o
o
o
o
o
AlphaBay
Utopia
The Silk Road
Sheep Marketplace
TheRealDeal
Black Market Reloaded
The Farmer's Market
Evolution
Agora
AlphaBay Market
Russian Anonymous Marketplace
Drug and Smuggling Rings
Smuggling is a behavior that has occurred ever since there were laws or a moral code
that forbade access to a specific person or object. At the core of any smuggling
organization is the economic relationship between supply and demand. From the
organization's point of view, the issues are what the consumer wants, and how much
the consumer is willing to pay the smuggler or smuggling organization to obtain it.
England
o Hawkhurst Gang (historical)
o The Aldington Gang (historical)
Organ trafficking organizations
o Gurgaon organ trafficking network
Arms trafficking organizations
o Russian arms traffickers
• Viktor Bout's organization
• Leonid Minin's organization
o Monzer al-Kassar's organization
o Tomislav Damnjanovic organization
o Soghanalian organization
People smuggling
o Snakeheads 蛇 頭
• Sister Ping's organization
o Coyotaje
o Shettie organization
o Mediterranean people smugglers
Lai Changxing organization
Bedouin smugglers
Subotić Tobacco mafia (alleged)
Drug rings
North American drug rings
o Garza organization
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o
o
o
o
o
o
o
o
o
o
o
o
o
Jesse James Hollywood's drug ring
The Brotherhood of Eternal Love
Black Tuna Gang
The Company
Jung organization
Mancuso organization
Chagra organization
"Freeway" Rick Ross
Ike Atkinson
Cournoyer organization
Cowboy Mafia
Pizza Connection
The Yogurt Connection
Bali Nine
Mr Asia syndicate
The French Connection
The Couscous connection
Valencia drug ring
Brian Brendan Wright's drug empire
Howard Marks
Rum-running organization
o William McCoy
o Roy Olmstead
Remus organization
Yashukichi network
Edward Ezra's opium smuggling operation
Tyrrell organisation
Guinea-Bissau cocaine traffickers
o Na Tchuto organization
Prison Gangs
Prisons are a natural meeting place for criminals, and for the purposes of protection
from other inmates and business prisoners join gangs. These gangs often develop a
large influence outside the prison walls through their networks. Most prison gangs do
more than offer simple protection for their members. Most often, prison gangs are
responsible for any drug, tobacco or alcohol handling inside correctional facilities.
Furthermore, many prison gangs involve themselves in prostitution, assaults,
kidnappings and murders. Prison gangs often seek to intimidate the other inmates,
pressuring them to relinquish their food and other resources. In addition, prison gangs
often exercise a large degree of influence over organized crime in the "free world",
larger than their isolation in prison might lead one to expect.
Primeiro Comando da Capital (First Command of the Capital) (São Paulo, Brazil)
Vory v zakone (вор в законе) (Prisons in Russia and other post-Soviet countries)
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The Numbers Gang (Prisons in South Africa)
Brödraskapet (The Brotherhood) (Kumla Prison, Sweden)
The Overcoat Gang (Prisons in Australia)
Philippines
o New Bilibid Prison
• Commandos
o Wild Boys of DaPeCol (Davao)
Prison gangs in the United States
White
o Aryan Brotherhood
o Dead Man Incorporated
o Public Enemy No. 1
o Nazi Lowriders
o European Kindred
o Aryan Circle
o 211 Crew
o Peckerwoods
o Aryan Brotherhood of Texas
Hispanic
o Barrio Azteca
o Mexican Mafia (La Eme)
o Nuestra Familia
o Texas Syndicate (Syndicato Tejano)
o Ñetas
o Puro Tango Blast
o Mexikanemi
o Hermanos de Pistoleros Latinos
African American
o Black Guerrilla Family
o D.C. Blacks
o United Blood Nation
o KUMI 415
People Nation
Folk Nation
Street Gangs
Youth gangs have often served as a recruiting ground for more organized crime
syndicates, where juvenile delinquents grow up to be full-fledged mobsters, as well as
providing muscle and other low-key work. Increasingly, especially in the United States
and other western countries, street gangs are becoming much more organized in their
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own right with a hierarchical structure and are fulfilling the role previously taken by
traditional organized crime.
North America
Friends Stand United
Freight Train Riders of America (alleged)
The Baldies
Juggalo gangs
Albanian Boys Inc
Chicago
o TAP Boyz
o Simon City Royals
o Chicago Gaylords
o Jousters
o Almighty Saints
o Popes
Italian-American street gangs
o South Brooklyn Boys
o Forty-Two Gang
o The Tanglewood Boys
Green Street Counts
Zoe Pound
Pacific-Islander American gangs
o Sons of Samoa
o Tongan Crip Gang
Native Mob
Savage Skulls (defunct)
African-American
Chicago
o Gangster Disciples
o Mickey Cobras
o Black Disciples
o Vice Lords
o Black P. Stones
o Four Corner Hustlers
o OutLaw Gangster Disciples
Black P. Stones (Jungles)
Bloods
o Sex Money Murda
o Double II Set
o Pirus
o Nine Trey Gangsters
Page 327 of 372

Crips
o
o
o
o
o
o
o
o
Venice Shoreline Crips
Rollin 60's Neighborhood Crips
Eight Tray Gangsta Crips
East Nashville Crips
Du Roc Crips
Rollin' 30s Harlem Crips
Grape Street Watts Crips
South Side Compton Crips
12th Street Gang
Errol Flynns
Westmob
Hidden Valley Kings
New York City
o Decepticons (defunct)
o Black Spades (defunct)
o GS9
Boston
o Lucerne Street Doggz
o Columbia Point Dawgs
o Orchard Park Trailblazers
Asian-American
New York City Chinatown
o Ghost Shadows 鬼 影 幫
o Flying Dragons
o Born To Kill 天 生 殺 手 幫
Asian Boyz 亞 洲
Chung Ching Yee (Joe Boys) 忠 精 義
Menace of Destruction 毀 滅 的 威 脅
Tiny Rascal gang
Fullerton Boys
Satanas
Viet Boyz
Hispanic
Latin Kings
Ghetto Brothers
New York City Dominican gangs
o Dominicans Don't Play
o Jheri Curls
o Trinitarios
Page 328 of 372

California
o White Fence
o Whittier gang
o Fresno Bulldogs
o Lott Stoner Gang
o Norteños
o Sureños
• 38th Street gang
• Culver City Boys 13
• Santa Monica 13
• Azusa 13
• Puente 13
• OVS
• Eastside Bolen Parque 13
• Northside Bolen Parque 13
• El Monte Flores 13
• Venice 13
• Tooner Ville Rifa 13
• Clanton 14
• Varrio Nuevo Estrada
• Playboys
• Avenues
• Logan Heights Gang
• Pomona 12th Street Sharkies
Chicago
o La Raza Nation
o Maniac Latin Disciples
o Spanish Cobras
o Spanish Gangster Disciples
Los Mexicles
Latin Syndicate
Historical
Irish American
o Bottoms Gang
o 19th Street Gang
o Bowe Brothers
o 40 Thieves
o Dead Rabbits
o Gopher Gang
o Grady Gang
o Five Points Gang
o Daybreak Boys
o Tenth Avenue Gang
o Kerryonians
Page 329 of 372

o
o
o
o
o
o
o
Roach Guards
Whyos
Chichesters
Marginals
Live Oak Boys
Potashes
Bottoms Gang
New York
o Neighbors' Sons
o Boodle Gang
o Loomis Gang
o Baxter Street Dudes
o Honeymoon Gang
o Mandelbaum organization
o Dutch Mob
o Eastman Gang
o Batavia Street Gang
o Bowery Boys
o Charlton Street Gang
o Gas House Gang
o Lenox Avenue Gang
o Crazy Butch Gang
o Hudson Dusters
o Humpty Jackson Gang
o Slaughter House Gang
o Cherry Hill Gang
o Swamp Angels
o Yakey Yakes
o Hook Gang
o Tub of Blood Bunch
Baltimore
o Bloody Tubs
o Plug Uglies
Sydney Ducks
Chicago
o Formby Gang
o Henry Street Gang
Yellow Henry Gang
Gangs in Canada
Vancouver
o Independent Soldiers
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o United Nations
o Red Scorpions
Aboriginal Based Organized Crime
o Indian Posse
o Native Syndicate
o Redd Alert
o Manitoba Warriors - 1323
Toronto
o VVT
o Dixon Bloods
o Khimera
Tri-City Skins
Shiners (historical)
South America
Gangs in Brazil
o Rio de Janeiro
• Amigos dos Amigos
• Comando Vermelho
• Terceiro Comando
• Terceiro Comando Puro
o São Paulo
• PCC - Primeiro Comando da Capital
o Brazilian police militias
• Acre death squad
o Maras
o Mara Salvatrucha
o 18th Street gang
Gangs in Haiti
o Zoe Pound
o Cannibal Army
Belize
o George Street Crew
Europe
Gangs in the United Kingdom
o
o
London
• Ghetto Boys
• Peckham Boys
• PDC
• Brick Lane Massive
• Woolwich Boys
• Wo Shing Wo street gang (defunct)
• Mus Love Crew
Gooch gang
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o
o
Birmingham
• Lynx gang
• Burger Bar Boys & Johnson Crew
Croxteth Crew & Strand Crew
Denmark
o AK81
o Black Cobra
Turkish-German gangs
o 36 Boys
o Black Jackets
Apaches (Belle Époque period)
Red Wall Gang (Dublin)
Africa
Gangs in South Africa
o Cape Ganglands
• Hard Livings
• The Americans
Gangs in Nigeria
o Area Boys
• One Million Boys
Morocco
o Tcharmils
Asia
Salakau
Bahala Na Gang
Rugby boys
Oceania
Gangs in Australia
o Sydney
• Rocks Push
• Dlasthr
o Melbourne
• Apex
o Perth
• Sword Boys
o Evil Warriors
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Gangs in New Zealand
o Mongrel Mob
o Black Power
o King Cobras
o Killa Beez
o Fourth Reich
Raskol gangs
Other
Timber mafia
o Malagasy logging syndicates
• 'Rosewood mafia'
Football hooliganism groups
o 6.57 Crew
o Arsenal firm
o Aston Villa Hardcore
Prostitution rings
o Emperors Club VIP
o Heidi Fleiss prostitution ring
o North Preston's Finest
o Vivian's Friends
o Pamela Martin and Associates
Spy rings
o Atomic spies
o Cambridge Five
o Duquesne Spy Ring
o Illegals program
o Portland Spy Ring
o Walker spy ring
Burglary rings
o Dinner Set Gang
o Bling Ring
o Johnston gang
o Sugarman Gang
Fraud rings (See also List of Ponzi schemes)
o Potato Bag gang
o Nigerian 419 gangs
• Chief Nwude and accomplices
o Benson Syndicate
o Dominion of Melchizedek
Illegal gambling rings
o Brazilian Jogo do Bicho rings
• Anísio group
• Capitão Guimarães group
• Andrade group
Page 333 of 372

• Luizinho Drummond group
• Turcão group
• Pinheiro group
o Tan betting syndicate
o Bad Newz Kennels dogfighting ring
Human trafficking rings
o Domotor family crime group
o la Chancha gang
Wildlife trafficking rings
o Wong organization
Kidnapping
o Black Death Group (alleged)
o The College Kidnappers
Criminals-for-hire
o Philadelphia Poison Ring (murder-for-hire)
o Sangerman's Bombers (arson)
The Chickens and the Bulls
Historical
Black Hand
o Chicago Black Hand
Thuggee (See also Criminal Tribes Act)
Garduna
Markham Gang
England
o Early crime syndicates
• Jonathan Wild's crime ring
• Charles Hitchen's crime ring
• Forty Elephants
• Ikey Solomon gang
• Worth gang
o Street gangs
• The Yiddishers
• Peaky Blinders
• Scuttlers
• Glasgow
• Penny Mobs
• Tongs
• Razor gangs
• Norman Conks
Predecessors to modern yakuza (See also Genyōsha)
o Tekiya 的 屋
o Bakuto 博 徒
o Kabukimono 傾 奇 者 (カブキもの)
American Frontier gangs (See also List of Old West gangs)
Page 334 of 372

o Ames organization
o Soap Gang criminal empire, Denver, Creede, Colorado, and Skagway,
Alaska 1880s-1890s.
o Swearengen gang
o Banditti of the Prairie
o Dodge City Gang
Dennison syndicate
o The Cowboys (Cochise County)
o Blonger gang
Ringvereine (Weimar Germany)
Historic prostitution rings
o Zwi Migdal
• Ashkenazum
o Red Light Lizzie and associates
o Jane the Grabber and associates
Historical Russian gangs (See also Early life of Joseph Stalin)
o Mishka Yaponchik gang
o Kotovsky gang
Stuppagghiari
Page 335 of 372

Page 336 of 372

XXII. References
1. https://en.wikipedia.org/wiki/Organized_crime
2. https://en.wikipedia.org/wiki/White-collar_crime
3. https://en.wikipedia.org/wiki/Arms_trafficking
4. https://en.wikipedia.org/wiki/Bribery
5. https://en.wikipedia.org/wiki/Cybercrime
6. https://en.wikipedia.org/wiki/Illegal_drug_trade
7. https://en.wikipedia.org/wiki/Embezzlement
8. https://en.wikipedia.org/wiki/Extortion
9. https://en.wikipedia.org/wiki/Fence_(criminal)
10. https://en.wikipedia.org/wiki/Fraud
11. https://en.wikipedia.org/wiki/Identity_theft
12. https://en.wikipedia.org/wiki/Kidnapping
13. https://en.wikipedia.org/wiki/Loan_shark
14. https://en.wikipedia.org/wiki/Money_laundering
15. https://en.wikipedia.org/wiki/Murder
16. https://en.wikipedia.org/wiki/Prostitution
17. https://en.wikipedia.org/wiki/Racket_(crime)
18. https://en.wikipedia.org/wiki/Terrorism
19. https://en.wikipedia.org/wiki/Theft
20. https://en.wikipedia.org/wiki/Witness_tampering
21. https://en.wikipedia.org/wiki/Intimidation
22. https://en.wikipedia.org/wiki/Transnational_crime
23. https://en.wikipedia.org/wiki/List_of_criminal_enterprises,_gangs_and_syndicates
24. https://openscholarship.wustl.edu/cgi/viewcontent.cgi?article=2101&context=law_lawreview
25. https://fas.org/sgp/crs/misc/R41547.pdf
26. https://www.unodc.org/documents/toc/factsheets/TOC12_fs_general_EN_HIRES.pdf
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Attachment A
Biblical Atonement
and Modern Criminal Law
Page 341 of 372

Washington University Law Review
Volume 65
Issue 4 Festschrift: A Celebration of the Scholarship and Teaching of Gray L. Dorsey
January 1987
Biblical Atonement and Modern Criminal Law
Jerome Hall
Follow this and additional works at: http://openscholarship.wustl.edu/law_lawreview
Part of the Criminal Law Commons, and the Religion Law Commons
Recommended Citation
Jerome Hall, Biblical Atonement and Modern Criminal Law, 65 Wash. U. L. Q. 694 (1987).
Available at: http://openscholarship.wustl.edu/law_lawreview/vol65/iss4/7
This Dedication is brought to you for free and open access by the Law School at Washington University Open Scholarship. It has been accepted for
inclusion in Washington University Law Review by an authorized administrator of Washington University Open Scholarship. For more information,
please contact digital@wumail.wustl.edu.

III. CONCEPTIONS, VALUE AND LAW
In Western civilization, a rationally ordered universe and human rationality
are the central tenets of theology and moral philosophy. Conceptions,
values, and principles implied by these premises have become entrenched
in social and legal institutions. Concluding that religious teachings, even
those of antiquity, are consistent with modern legal principles is reasonable,
and almost common sense. An inquiry into whether this relationship
is to any extent causal is fascinating. Professor Jerome Hall, the first President
of AMINTAPHIL, discusses the relationship between the Christian
doctrine of atonement and principles of modern criminal law.
BIBLICAL ATONEMENT AND MODERN
CRIMINAL LAW*
JEROME HALL**
The organization of a Section on Law and Religion in 1976 by the
Association of American Law Schools (after Watergate) was followed in
1977 by the incorporation of the Council on Religion and Law. My participation
in both led to the study of theology and especially to the question,
what, if anything, can a legal scholar, particularly one specialized in
penal law and the philosophy of law, contribute to the literature on the
interrelations of law and religion? In the English-speaking world not
many legal scholars have written on this subject, and none, to my knowledge,
on the interrelationship of religion and modem criminal law. 1 I
here confine my discussion to the Bible and, more particularly, to some
of the writing on atonement by Christian theologians.
The central focus of Christianity is on the crucifixion and resurrection
of Jesus Christ, and the relevant theme, originating in the Old Testament
* This article was originally published in Japan in a Festschrift for Justice Shigemitsu Dando
upon his retirement from the Supreme Court of Japan. It subsequently appeared in THE JOURNAL
OF LAW AND RELIGION, Volume I, Number 2, 1983.
** Jerome Hall, LLD. (H.C.) Tfibingen University 1978, is Professor of Law at the University
of California's Hastings College of the Law. He is a past president of the American Society for
Political and Legal Philosophy, a member of the China Academy, Honorary Director of the Korean
Law Center, and a Director of The Council on Religion and Law.
1. See J. HALL, LAW, SOCIAL SCIENCE AND CRIMINAL THEORY, chs. I and 2 (1982).
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and frequently addressed in the New Testament, is that of atonement.
Both the Old Testament and the New Testament accept and emphasize
the vicarious significance of the sacrifice-the lamb in the Old Testament,
Jesus in the New Testament. The one sacrificed takes on itself or
himself the sins of Israel or the sins of all mankind. Likewise, the sacrifice
frees all Israel or all mankind from sin, and the consequence is reconciliation
with God.
But modem ethics, especially Kantian, and modem penal law reject
both connotations of Biblical atonement and the relevant theology. In
modem penal law, for example, one is responsible only for his own
crimes, not for those of his wife or bother. So, too, no substitute for the
criminal will be punished. The offer of a father to go to prison instead of
his convicted son's doing so would be irrelevant, and is hardly conceivable
in modem penal law. Hence, the principal problem: Is there a sharp
conflict between religion on the one side and law and ethics on the other?
Or, since one must distinguish religious faith from knowledge of positive
law and morality, are the two realms compatible?
There have been innumerable interpretations of atonement but for the
present purpose they may be divided into two types or classes-the legal
interpretation and the antilegal interpretation posited solely on God's
love. Not that the legal interpreters did not appreciate God's love; that
would be inconceivable in any Christian theologian. But they also recognized
the "wrath of God," his hatred of evil, and his frequent threats to
impose harsh sanctions. 2 For obvious reasons, I shall be particularly interested
in the legal interpretation, for it is there that we find both the
direct influence of law on religion and theology, and the influence of religion
through its theological view of atonement on penal law. There are
many statements in the Old Testament that express or imply one or more
of the ideas that define "atonement." "And Aaron shall offer the bull, as
a sin offering for himself, and shall make atonement for himself and for
his house.., and shall lay both his hands upon the head of the goat and
send him away into the wilderness ... and make atonement for himself
and for the people." (Lev. 16:6, 21, 24).
One thousand years separate the authors of the earliest books in the
Old Testament from the later prophets who spoke of God not as jealous
or hating but as a loving father and merciful judge. Indeed, it is in Isaiah
2. This simplification of the difference between the principal types of interpretation will be
more fully elucidated in the following discussion.
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53 where one finds the later expression of atonement to which Christian
theologians constantly refer and rely on as prophetic of the coming of
Jesus as Messiah. "He was despised and rejected by men.... Surely he
has borne our griefs and carried our sorrows.... He was wounded for
our transgressions . . .upon him was the chastisement that made us
whole, and with his stripes we are healed.... He bore the sins of many,
and made intercession for the transgressors."
In the New Testament, Jesus, the perfect man-God, "died for the ungodly;"
(Rom. 5:6) "while we were enemies we were reconciled to God
by the death of his Son.... ." (Rom. 5:10) "Then as one man's (Adam's)
trespass led to condemnation for all men, so one man's act of righteousness
leads to acquittal and life for all men." (Rom. 5:18, also Heb. 7:25).
"By his wounds you have been healed." (1 Peter 2:24; also Col. 1:14).
"This was to fulfill what was spoken by the prophet Isaiah ..... " (Matt.
8:17). "Christ redeemed us from the curse of the law.... ." (Gal. 3:13).
"Behold, the Lamb of God, who takes away the sin of the world." (John
1:29).
What have the theologians whose interpretations have been called
"legal" said about these passages in the Bible? Tertullian (c. 155 A.D.-
230 A.D.), one of the most erudite of the Church fathers, was said by
some to be a Roman lawyer and he was even identified, probably mistakenly,
with the jurist Tertullianus. In any case, the schools in Carthage,
where Tertullian studied, taught rhetoric, law and philosophy, and every
educated Carthaginian knew a great deal of the dominant Roman law. a
Certainly Tertullian's treatises bear the unmistakable marks of a legal
mind. His Apology Against the Heathen 4 is a lawyer's brief criticizing
Roman procedure in the trial of Christians. Tertullian spoke of "God's
wrath" and his "eternal penalties." 5 His central terms-debt, satisfaction,
compensation, guilt-have obvious legal connotations.' He empha-
3. "... (Tertullian) displays a thorough and (it is claimed) profound knowledge of Roman
Law." (T. BARNES, TERTULLIAN 23 (1971) citing Beck, Romisches Recht Bei Tertullian and Cyprian
(1930)). "Secondly, knowledge of Roman law was not the exclusive prerogative of iuris consult.
It was a necessity for advocates pleading cases in court and also a normal possession of the educated
man." Id. at 24.
4. TERTULLIAN, APOLOGETIC AND PRACTICAL TREATISES published in 10 LIBRARY OF FA.
THERS OF THE HOLY CATHOLIC CHURCH 6-12 (1854).
5. Id. at 146, 366.
6. "The old Roman law conception appears... in Tertullian's portrayal of God as Judge and
in his teaching that the relationship of man to Him is pre-eminently that of a criminal to his judge."
J. MORGAN, THE IMPORTANCE OF TERTULLIAN IN THE DEVELOPMENT OF CHRISTIAN DOGMA 54
(1928). For examples of Tertullian's use of other legal terms, see MORGAN, id. at 67-76.
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sized man's duty to make "satisfaction to God by repenting of his sins." 7
"How foolish, moreover, how (unjust) ... not to pay the price (repentance)
and yet to stretch forth the hand for the merchandise- For at
this price the Lord hath determined to grant His forgiveness." ' Repentance
was "satisfaction," 9 appeasement of the wrath of God and avoidance
of punishment. 10 "God sitteth over us as a Judge to exact and to
maintain that righteousness.., and with a view to this establisheth the
entire sum of His law...."11
One derives Tertullian's legal interpretation of the atonement by bringing
together relevant statements in several of his essays. It was Anslem
who provided the classic legal interpretation in a systematic, tight, logical
discussion-the renowned Cur Deus Homo. 1 2 He was born in 1033
(d. 1109) in Piedmont and studied law in Pavia. His thought reveals the
influence of the feudalism of his time, of Lombard law and the Church's
penitentials. "[T]o sin," he said, "is nothing other than not to render to
God what is due." 13 "What is the debt which we owe to God? Whoever
does not pay to God his honor due Him dishonors Him and removes
from Him what belongs to Him.. ."."' "Indeed God's wrath is nothing
other than his will to punish." 15 Repayment for the dishonor is not sufficient
unless "in proportion to the injury caused by the dishonoring, he
makes some restitution which is acceptable to the one whom he has dishonored.
Satisfaction ought to be proportional to the measure of the
sin."' 6 When earthly rulers "rightly exercise retribution, the Lord Himself
does it; for they have been ordained by Him to this end." 17 It follows
inexorably that either the dishonor of God is "repaid" or there will be
punishment. 18 Thus, in the end, God cannot be dishonored.
The next step in Anselm's argument is that no man, indeed, not even
all human beings, can make sufficient satisfaction since all men are sinners.
Christ was a logical necessity since the required satisfaction can
7. TERTULLIAN, supra note 4, at 358.
8. Id. at 359.
9. Id. at 370.
10. Id at 371.
11. Id. at 353.
12. 3 ANSELM OF CANTERBURY (J. Hopkins, H. Richardson, trans., 1976).
13. Id. at 67.
14. Id at 68.
15. Id. at 55.
16. Id.
17. Id at 69.
18. Id. at 71.
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only be paid by someone who is sinless. Sin calls for payment "greater
than any existing thing besides God.... Therefore only God can make
this satisfaction." 19 But since man ought to make this satisfaction and
since only God can make it, "it is necessary that a man-God make it." 20
The logic of this argument is evident in its successive steps-God's
honor, the sinner's disobedience, God's wrath, the need for satisfaction,
and the inability of sinners to justify sinners-hence the Virgin birth and
the incarnation of the man-God who pays the price and effects the reconciliation.
21 In later discussions of the atonement there are variations
from the rigor of Anselm's treatise, but Why God Became Man set the
parameters of those discussions whether pro or con the legal
interpretation.
Calvin (1509-1564) studied law at Orleans and Bourges; hence it is not
surprising that he praised law as God's commands "that he might lift
their minds higher." 22 Law also admonishes, is a necessary deterrent 23
"and urges them on in well-doing." 2 4 "The law shows the righteousness
of God ....,25 He anticipated Jhering and Fuller: ". . . if the forms of
the law be separated from its end, one must condemn it as vanity." 26
Alvin wrote of "God's fearful vengeance against the whole of mankind."
2 7 But God, while not ceasing to love his children, is "wondrously
angry toward them . ..he would frighten them . . .to humble their
fleshly pride, . . . and arouse them to repentance." 28 Although "they
who ... provoke his wrath ... will not escape his vengeance,"29 ". . .it is
not, properly speaking, punishment or vengeance, but correction and admonition."
3 A secular judge "applies the penalty to the crime itself.
But when a father ... corrects his son, he does not do this to take yen-
19. Id. at 102.
20. Id.
21. See Anselm's essay, The Virgin Conception and Original Sin, id. at 143. The influence of
ancient Greek mythology and metaphysics on Christology is beyond the scope of this paper.
22. J. CALVIN, Institution of the Christian Religion, 20 LIBRARY OF CHRISTIAN CLASSICS 349
(J.T. McNeill ed. 1960).
23. Id. at 358-59.
24. Id at 360.
25. Id at 354.
26. Id. at 349.
27. Id at 244-45.
28. Id at 577.
29. Id. at 659.
30. Id.
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geance on him or to maltreat him but rather to teach him ....
"[T]he whole human race perished" because of Adam's disobedience.
32 "This is our acquittal: the guilt that held us liable for punishment
has been transferred to the head of the Son of God." ' 33 ".... God's
judgment was satisfied by that price.", 34 Calvin writes of Jesus' sacrifice
as "his act of expiation" to "appease the father's righteous wrath. '35
Jesus' "pleading, ' 36 his intercession as man's advocate, brings "our acquittal,"
37 "[t]he curse.., was transferred to him... (who) clothed us
with his purity." 38
Opposition to legal interpretation of atonement, based in part on
Clement and Abelard, was eloquently expressed by Bushnell, an American
clergyman, in 1874. 39 Bushnell argued that Jesus did not suffer for
justice but in self-sacrifice. It dishonors God, indeed it implies that he is
immoral, to say that he "accepts the pains of the good in payment of the
pains of the bad." ' The legal interpretation of atonement describes "a
coarse commercial transaction."'" Law is defective, first, because it is
penal and does not bring about reform by free choice. And, second, it is
negative in its prohibitions. 42 Bushnell uses the model of the family and
the school; the mother or the teacher corrects out of love. Their correction
is "not judicially penal ... for it is not graded by the desert of
actions, but by what is wanted for the future benefit and due correction
of the actors." '4 3 It is not "a substantive measure of their iln-desert." 44
Bushnell thought there was "no such thing" as "a penalty undeserved."
Moreover, there is no "common measure" in undeserved penal-
31. Id at 340. "In the dogma that the whole human race is condemned on account of the sin of
its first parents, the doctrine of collective responsibility has reached its pitch." WESTERMARCK, 1
THE ORIGIN AND DEVELOPMENT OF THE MORAL IDEAS 50-51 (1971).
32. Calvin, supra n.22, at 509, 510.
33. Id. at 351.
34. Id. at 467.
35. Id. at 502.
36. Id. at 509.
37. Id at 510.
38. H. BUSHNELL, FORGIVENESS AND LAW (1874). See Rashdall, The Abelardiun Doctrine of
the Atonement, in DocrINE AND DEVELOPMENT 128 (1898).
39. Bushnell, supra n.39, at 86.
40. Id. at 91.
41. Id. at 109.
42. Id. at 134.
43. Id. at 135. Bushnell says "the word justice does not occur once in the New Testament...
Id. at 141.
44. Id. at 143-44.
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700 WASHINGTON UNIVERSITY LAW QUARTERLY [Vol. 65:694
ties and deserved ones. 45 It is contrary to the spirit of the New
Testament to list a set of "vocables" as substitutes for penalty, compensation,
transferable merits, sins carried over, sins accepted for the sinner
and so on. These "theological counters" and "computations of atonement"
are "to any Christian believer" a "very sad affair," not "altogether
spurious," but "artificial. ' 46 In even stronger terms a contemporary theologian
wrote: "To speak as if the Son... appeased or propitiated God
... is blasphemy. 4 7
In a similar vein, the philosopher-theologian, H. Rashdall, critical of
every aspect of the legal interpretation, argued that Jesus' death could
help others only in the way that the acts of other righteous persons could
help others-by their example, stimulating benevolence. 4 8 He also rejected
the view that Christ's death was a ransom paid to the Devil or to
God. 49 "God is a loving Father who will pardon sin upon the sole condition
of true repentance." 50 He seeks reconciliation, or at-one-ment. Tertullian's
theory is "coarsened and legalized,"" 1 "poisoned by the
substitution of legal for moral conceptions." 2 To Rashdall, Anselm employed
Lombard conceptions of civil law-satisfaction, debt and Wergild.
53 His "notions of justice are the barbaric ideas of an ancient
Lombard king or the technicalities of a Lombard lawyer... ."I Most
interesting is Rashdall's rejection of "the attribution of guilt to all humanity
for the sin of one, nor can the payment of a penalty by the sinless
Christ rationally or morally be considered to make any easier or any
juster the remission of the penalty which man owes for his own sin." ' 5
"We have no right to pronounce just in God what would have seemed
the highest injustice among men. 9 ' 56
Rashdall strikes his heaviest blow on the retributive theory of punishment.
That theory, he states, is implied in the emphasis on expiation and
penalty in all legal interpretations of atonement. It is "a survival of
45. Id. at 95.
46. F. DILLISTONE, THE CHRISTIAN UNDERSTANDING OF ATONEMENT 244 (1968).
47. H. RASHDALL, THE IDEA OF ATONEMENT IN CHRISTIAN THEOLOGY 35 (1919).
48. Cf. Mark 10:43-45; Matthew 20:26-28.
49. RASHDALL, supra note 48, at 48.
50. Id. at 249.
51. Id. at 253.
52. Id. at 351-52.
53. Id. at 355.
54. Id.
55. Id. at 356.
56. Id. at 422.
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primitive modes of thought.., it cannot be rational to inflict an evil
except as a means to good-the good of the offender or of others." It is
inconsistent with the Christian ethic of love and the character of God.
"Even on the retributive view of punishment it is impossible to defend
7
the punishment of the innocent in place of the guilty."'
In his recent book 5 " Hans Kiing, a Catholic theologian, adds some
surprising innovations in his criticism of the legal interpretations of the
atonement. For him God is "wholly love." 59 Conspicuously omitted
from his Index are the terms "penance," "punishment," "wrath of God"
and "Hell." ' After listing the "juridical concepts" used in legal interpretations-"law,
guilt, penalty, reward, penance, expiation, ransom, satisfaction,
reconciliation, restitution," 6 he characterizes those
interpretations as "a re-Judaizing process in the name of Christianity."" 2
More surprising is his statement that the idea of original inherited sin,
upon which the necessity of the God-man's intercession depends, "seems
problematic." 63 He rejects the theory of redemption on which the legal
interpretation rests because it is legalistic, based on Roman law, "legal
niceties" and human justice, not on the "grace, mercy and love" characteristic
of the New Testament." He even rejects "sacrifice" emphasized
in the legal interpretation. "Is God so cruel, even sadistic, that his anger
can be appeased only by the blood of his Son?" Instead of "sacrifice,"
Kung would substitute "voluntary personal self-surrender".... "self-giving.",
65 Instead of "expiatory sacrifice," Kung offers "reconciliation, representation,
redemption, liberation." ' 66 For Kung, "God loves sinners
more than his righteous. ' 67 "He forgives instead of condemning, liberates
instead of punishing, permits the unrestricted rule of grace instead of
57. H. KUNG, ON BEING A CHRISTIAN (E. Quinn, trans., 1976).
58. Ma at 435.
59. Jesus often threatened hell, everlasting fire and "gnashing of teeth." Matthew 5:22, 30;
8:12; 11; 23; 13; 42; 18:8, 9. "Wrath of god" is a frequent expression in the New Testament, Matthew
3:7; Romans 1:18; Ephesians 5:6.
60. KLUNG, supra note 58, at 421.
61. Id
62. Id. at 422.
63. Id. at 423. Similarly, "[i]t [redemption] is ... an outstanding example of a legal notion
being taken up and made into a religious notion by priests and prophets." D. DAUBE, STUDIES IN
BIBLICAL LAW 42 (1947).
64. Kung, supra note 58, at 424-25. KUNG omits any reference to Jesus' first words on the
cross-the first line of Psalm 22.
65. KUNG, supra note 58, at 426.
66. Id. at 274. Kung's italics.
67. Id. at 313.
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law .... The God who prefers the sinner.., the prostitutes and adulterers
to their judges, the law-breakers and outlaws to the guardians of the
law." 6 "He is a God who lavishes his grace on those who do not deserve
it." 6 9 "He is not a God of law, but a God of grace." 70
The distinguished theologian, Emil Brunner, provides a detailed refutation
of the anti-legalist interpretations of the atonement. 71 They err, he
argues, in thinking that the only alternative to Anselm is the "wholly
subjective" view that "the death of Jesus was a sublime and noble martyrdom.
'72 Their most serious defect is that they trivialize guilt. "If the
Cross merely denotes the removal of a religious error (namely, that God
is not an angry Judge) then guilt is not taken seriously," '73 Moreover, if
"guilt is merely error, and God is nothing but love, there is no need for
forgiveness; ... all you need is to know it." 74
"Divine punishment also issues necessarily from the Holiness of
God," '75 but at the same time there is "the overwhelming reality of forgiving
love." ' 76 "That God can be both at once, the One who 'is not
mocked,' and the One who 'doth not deal with us after our transgressions,'
that neither aspect is sacrificed to the other ... this fundamental
theme of the whole Bible is the message of the Cross .... , Accordingly,
although Jesus' Passion is not a penalty, certainly not a transaction,
"it is a sacrifice, a vicarious action" in which Jesus identified himself
wholly with the human race.
Instead of deprecating law, Brunner eulogizes it. "The law is the manifested
Will of the Lord God.... All order, all significance, all beauty,
all trustworthiness, all constancy, all fidelity and all faith, all truth and
all good, are based .. .upon the Law, which constitutes the intrinsic
68. Id. at 435. Tillich has echoed this: ... justice is the structural form of love without which
it would be sheer sentimentality ... there are no conflicts in God between his reconciling love and
his retributive justice." P. TILLICH, 2 SYSTEMATIC THEOLOGY 174 (1957).
69. KUNG, supra note 58, at 314. "thus the law is an enemy.... The Divine Love cannot be
imprisoned in the categories of merit and justice .... " G. AULEN, CHRISTUS VICTOR 68 (A.
Herbent trans. 1966).
70. E. BRUNNER, THE MEDIATOR (0. Wyon trans. 1934).
71. Id. at 439.
72. Id. at 471.
73. Id. at 472.
74. Id. at 464.
75. Id. at 449.
76. Id. at 452.
77. Id. at 495.
78. Id. at 461.
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content of His Will .... ,"79 "[This law] demands the divine reaction, the
divine concern about sin, the divine resistance to this rebellion, and this
breach of order.... If this were not true there would be no seriousness
in the world at all; there would be no meaning in anything, no order, no
stability... chaos and desolation would be supreme." 80 The Bible is
"full of such juridical expressions... guilt, remission of guilt, judgment,
judge, punishment, accusation, condemnation, pardon, release...." 81
I leave it to the reader to choose which, if any, interpretation of biblical
atonement he prefers. The problem discussed here is an interdisciplinary
one based on certain interrelations of law and religion. More
narrowly, it is focused on the legal interpretation of atonement and especially
on the opposition of vicarious and individual responsibility.
Pervading all of these problems is that of interpretation itself-what
the theologians call exegesis or hermeneutics. A Christian theologian
will interpret Isaiah 53, indeed most of the Old Testament, as prophetic
of the coming of Christ while a Jewish theologian will provide a very
different interpretation of that Testament, including Isaiah 53. So, too,
Kung's negative view of Hinduism and Buddhism is far different from
that of adherents to those world religions. Just as lawyers are influenced
by their clients' interest and interpret statutes in conformity with that
given end, so does a theologian's conception of God determine his interpretation
of a religious text. Just as lawyers pick and choose among the
cases so do theologians select those biblical passages that support their
ordained goal. In the practice of law, however, subjectivity is diminished
by the adversary system either directly as in the Anglo-American system
or indirectly as in the civil law systems and, also, in both, by the impartiality
of the judge. 82
Certain other generalizations regarding the interpretations of biblical
atonement may be ventured. First, both legalists and anti-legalists agree
that Jesus bore all men's sins. But the reasons differ widely-from a belief
in orthodox Christology to the simple belief that Jesus identified with
79. Id. at 444.
80. Id. at 465.
81. See J. HALL, Religion, Law and Ethics, in LAW, SOCIAL SCIENCE AND CRIMINAL THEORY
(1982).
82. In Judaism "atonement... is effected through suffering by the individual himself. This is
where Judaism and other religious systems differ most widely from Christianity, which does not
think of atonement as affected by man's effort or suffering.... Christianity met [this problem] with
its Christology." O.S. RANKIN, ISRAEL'S WIsDOM LITERATURE 122 (1954 reprint of 1936). See I.
al Farqi, Islum, in THE GREAT ASIAN RELIGIONS 312 (W. Chan ed. 1969).
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all suffering, sinful humanity. 83
Second, both sides seem to agree that Jesus' life, if not his crucifixion,
was necessary for the salvation of sinful humanity, although again "necessary"
is given different interpretations ranging from acceptance of orthodox
views of original sin and the incarnation to the inspiration of his
life "unto death."
Third, the legalists praise law and retributive justice, while the antilegalists
criticize and condemn both. For the former, law, far from being
a burden, 84 represents God's communication of his righteousness, his
guidance, and his loving chastisement to lead people away from evil and
toward goodness. For the anti-legalists, acceptance of law even as a minimum
standard turns quickly to criticism of law as "legalistic" and, in
any case, as far inferior to God's loving grace. The parallel of that with
Plato's criticism of law in The Statesman and his preference for the justice
and wisdom of the philosopher-king are striking. Equally significant
are the biblical foundations of the perennial debates between deontologists
and utilitarians regarding punishment.
We can better understand atonement vis-a-vis present-day problems of
penal law if we first take a backward glance at the place of collective
responsibility and retribution in past ages. Only then can we appreciate
the fact that our ancestors were not irrational in their penology. Moreover,
that history is a necessary prolegomenon to a realistic grasp of present
problems, for in that wider perspective we may discover not only that
the past can guide us toward feasible reforms but also that it imposes
limits on utopian plans to uproot retributive justice.
From the perspectives of sociology and modern penal law collective
responsibility seems superstitious and based on the myth that a society is
a great ego, a person separate from the interactions of individuals; and it
is outrageous from an ethical viewpoint since it imposes punitive sanctions
on innocent persons. But history reveals interesting relevant facts.
First, in pre-industrial societies, both ancient and modern, social groups
are so closely knit in intimate contact and association (whose unity was
symbolized in the leadership of a chief or ruler) that it is the most natural
83. Psalm 19. See A. BUCHLER, STUDIES IN SIN AND ATONEMENT (Intro. by F.C. Grant,
1967).
84. See H. ROBINSON, THE HEBREW CONCEPTION OF CORPORATE PERSONALITY (1964). In
the thought of ancient Israel "sin was more than guilt; it was pollution. It infected the whole neighborhood...
his city, his tribe or nation, and also their cattle and crops." F. Grant, Prolegomenon, in
A. BUCHLER, STUDIES IN SIN AND ATONEMENT XXI, XXVII (1967).
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thing in the world to think not of or as an individual but, instead, to
think in concepts of the family, the clan, the community, or the nation.
Only with industrialization and the loosening of ties does individualism
make its appearance. Accordingly, we should distinguish present-day sociological
conceptions of the group from the corporate idea that dominated
biblical times. 5
But, secondly, it has become clear that there was not simple unilinear
evolution starting solely from the idea of corporate responsibility and
ending in the substitution of the ethic of individual responsibility. From
ancient times, moral leaders, including dramatists of ancient Greece, limited
corporate liability by insisting that the innocent should not be punished
for crimes committed by others. Moreover, as we shall see,
although the pendulum has swung far from collective to individual liability,
corporate liability is by no means completely absent in contemporary
society, even from present-day law. It was usually the prophets who
spoke of the nation's blessings and its liability. But Jeremiah and Ezekiel
(Ez. 18) were among the first to criticize collective liability, especially the
punishment of innocent persons for the sins of others. 8 6 It is also noteworthy
that in many cases when God punished the nation, it was not for
its sin but because of the ruler's sin; the king was the "owner" of the
people. 8 7 Still, collective thinking was dominant.
Westermarck cites literally hundreds of examples of collective responsibility
among the ancient Greeks, Hebrews, Christians, Japanese, Koreans,
Persians, Hindus and Teutons as well as among many primitive
peoples. 88 He also gives instances of the rejection of collective liability. 9
Sin was regarded as a contagious disease which could be transferred to
85. 0. Rankin, supra note 82 at 53-54, 70. Recent studies by anthropologists support the view
expressed in the Bible, namely, that individual responsibility was sometimes advocated along with
collective responsibility. One anthropologist even says: "In fact, individual responsibility always
exists inside corporate groups." In the pre-industrial societies which this anthropologist studied,
collective responsibility was manifested in relation to other groups, that is, when a member of group
A killed a member of Group B. MOOR, THE ALLOCATION OF RESPONSIBILITY 100 (M. Glickman
ed. 1972). See T. ELIAS, THE NATURE OF AFIucAN CUSTOMARY LAW 134 (1954).
86. D. Daube, supra note 64, at 162-63.
87. E. WESTERMARCK, 1 THE ORIGIN AND DEVELOPMENT OF THE MORAL IDEAS 32, Ch. 2
and 19 (1917); L. HOBHOUSE, MORALS IN EVOLUTION 70-104 (1916); POLLOCK, MkrTLAND, 1
HISTORY OF ENGLISH LAW 678 (1923).
88. "[Flor another's sin let me not suffer." RIG-VEDA ii, 28; 29; Westermarck, supra note 87,
at 49. See, Deuteronomy 24:16 and 2 Kings 14:6.
89. Westermarck, supra note 87, at 61.
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others and spread like an epidemic. 90 This led to the ritual of "transferring"
the sins of the people to the sacrificed animal or the human
sacrifice. 91
Because collective responsibility means strict liability, the punishment
of innocent persons, it is abhorrent to the modem mind. As Kant put it,
penal liability is not "transmissible ... like a financial indebtedness...
only the culprit can bear [punishment] which no innocent person can
assume even though he be magnanimous enough to wish to take it upon
himself for the sake of another." 92 Nevertheless, the universality of collective
responsibility in past ages, the group mind-set rather than individualism
(although alleviated from early times by pleas to spare the
innocent), the likelihood that deterrence was also advanced by the threat
to punish a wrongdoer's family, clan or nation-these and other factors
described above made acceptance of the concept of collective responsibility
natural and normal.
There is another phase of social experience that must be considered if
we are to understand biblical atonement, namely, the role of the hero in
history. If "society," viewed either as the aggregate of individuals or as a
separate holistic entity, can be harmed (e.g. in ways that distinguish
crimes from civil damages) 93 it is also true that society benefits from the
sacrifice and contributions of its heroes-its great religious and moral
leaders, its artists, scientists and scholars. All through history people
have identified with and sung the praises of great men and women. Indeed,
*Carlyle hardly exaggerated when he included "Hero Worship" in
the title of his book since, for him, "Universal History, the history of
what man has accomplished in this world, is at bottom the History of the
Great Men .... 9
A more circumspect study of heroes emphasizes "the vicarious gratification
of the [people's] yearnings through his presumed traits and
90. Id. at 63. Quoting Frazer: The Victim must be a "representative of the community...
accepted as a substitute on the principle of social solidarity." Id. at 67-68. See D. BROWNING,
ATONEMENT AND PSYCHOTHERAPY (1966).
91. 1. Kant, Religion Within The Lights of Reason Alone 66 (T. Greene, H. Hudson trans.
1934).
92. See J. HALL, GENERAL PRINCIPLES OF CRIMINAL LAW 240-246 (1960).
93. T. CARLYLE, HEROES, HERO WORSHIP AND THE HEROIC IN HISTORY 1 (1840). "Such
great teachers are very few in the world.... They alone can carry us to the life divine." R. SRIVAS-
TAVA, COMPARATIVE RELIGION 241 (1974).
94. S. HOOK, THE HERO IN HISTORY 22 (1943).
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achievements." 9 Krishna took human form when the need to overcome
unrighteousness became urgent, Buddha's compassion went out to all
suffering humanity, and many heroes in Ancient Greece were believed to
be the sons of gods or goddesses. Nor is it only the great who elicit praise
and gratitude. Many soldiers have sacrificed their lives that their comrades
might live, and countless other "ordinary" persons never mentioned
in the history books make daily sacrifices that others may benefit.
It is in this perspective that versions of the atonement emphasizing Jesus'
identification with all troubled, rejected men and women have great
proximity to the experience of gratitude and love that people have felt for
their heroes. 96
If we combine reverence for the hero and the gratitude and affection he
or she inspires-if we join that to normal acceptance of collective responsibility
especially in past ages, it is no great leap from that platform to
Biblical atonement in both its connotations-bearing the sins of others
and the consequent benefit to the sinners. The above experience is projected
into a religious faith.
My concern here, however, is not theological, but secular, 97 especially
with the interactions of law and religion. Indeed, positive law and religion
are so intertwined, both in the Bible and in the Qur'an, that it is no
exaggeration to speak of the legal component of religion, of law in religion.
There is no better evidence of that than the writing of the theologians
who for centuries advocated legal interpretations of atonement.
If we glance at our present situation we find that some of the relevant
concepts are still operative. Samuel Johnson said: "No man is thought
the worse of here, whose brother was hanged." 98 But humanists are rare,
and who can doubt that the families of some convicted criminals are
often ostracized and suffer other discriminations? In wartime hostages
are taken or killed, prisoners in a concentration camp are held responsible
for the conduct of all the prisoners, and teachers penalize an entire
class for the misbehavior of one student, especially if he does not confess.
95. Compare Kant regarding the "superhuman." "[H]is distance from the natural man would
then be so infinitely great that such a divine person could no longer be held up as an example of him.
Man would say: If I too had a perfectly holy will all temptations to evil would of themselves be
thwarted in me... I too should take upon myself not only willingly but joyfully all sorrows... even
to the most ignominious death, since I would see before my eyes the glorious and imminent sequel."
Kant, supra note 91, at 57-58.
96. For my support and defense of religous faith see supra note 92, at 57-58.
97. For my support and defense of religious faith see supra note 1, at 16-26.
98. Daube, supra note 64, at 188.
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There is strict vicarious liability in modem legal systems when an innocent
employer is fined because of his employee's misconduct. Innocent
stockholders pay the fines assessed against the corporation and they also
benefit from most actions of the managers. 9 In international relations,
political leaders may provoke wars, and innocent lives are lost. Thus,
collective responsibility remains very much alive. Much of it, perhaps
most of it, does not fall within the precise meaning of "crime," "criminal
law" or "punishment;" this, indeed, has been said by many scholars
about strict penal liability. But the liability of associations, social sanctions,
and the work of social agencies are important aspects of the wider
context in which modem systems of criminal law can be placed to the
advance of knowledge of that law.
There is a final problem to be confronted which raises the most insistent
of all the issues. Following precedent, we have been saying thus far
that the legal interpretation of atonement was influenced by Roman or
Lombard or feudal law. But if we press beyond those indubitable legal
factors, if we seek the cause of many of their penal provisions, we find at
the bottom of them-retribution. The usual description of the evolution
and progress of retribution seems persuasive. First came instinctive retaliation
against aggression. Second, comes vengeance which is supported
by social norms, "oo and is limited by a sense of equivalence and
reciprocity, as in barter. Finally, there emerges a principle of retribution
which is refined over the years until it becomes the retributive justice that
moral philosophers espouse.
The Bible and the history of theology reveal the outlines of the perennial
battle between those who would punish sinners and criminals because
they were intentional wrongdoers and those who would deter or
reform them. They also reveal the commingling of retributive and utilitarian
concepts. The sinner deserves to be punished, and punishment
will also deter potential sinners; but most of all the Bible teaches that
what is paramount is the reform of wrongdoers, i.e., reconciliation with
God, resulting from repentance, restitution, and forgiveness.
99. H. MANNHEIM, GROUP PROBLEMS IN CRIMINAL PUNISHMENT 43 (1955) distinguishes
strict liability from that imposed on members of a union or partnership by reliance on the act of
members in joining those associations. But surely the act of one who buys stock or joins a union is a
very slender reed on which to rest punitive sanctions.
100. H. KELSEN, SOCIETY AND NATURE 52, 55 (1943) W. McCulloch wrote that among the
Koupoules of India "the greatest misconduct is the forgiveness of an injury, the first virtue, revenge."
KEILSEN, id. at 64-65. Kelsen says at p. 235 that the retributive principle is the origin of the
idea of causation.
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In modem times the issues have been cast in sharper, mutually exclusive
terms. At the one extreme is Kant's scom of the crass utilitarianism
that defends punishment only because it would deter others. For him,
every human being should be treated as an end in himself, not as a means
to extrinsic objectives. Desert is the only justification for punishing anyone.
At the other extreme is Henry Sidgwick, the eminent moral philosopher,
who wrote that he had "an instinctive and strong moral aversion
to it [retribution] ... it is gradually passing away from the moral consciousness
of educated persons in most advanced communities.... ." But
he admitted that "it is still perhaps the more ordinary view." 1 0 1 Even
stronger was Rashdall's condemnation of retribution. For him, "it cannot
be rational to inflict an evil except as a means to good-the good of
the offender or of others.'
2
It is not my present purpose to unravel the complexities of the voluminous
literature on "punishment." 103 But I should like to suggest a possible
way to advance discussion of this subject.
Retribution is a universal phenomenon and experience among primitive
as well as among civilized people, in ancient Greek drama, in the Old
and New Testaments."4 It is implied or expressed in every legal system,
even in those that explicitly reject it and then go on to impose punitive
sanctions on criminals in proportion to the gravity of the harms they
commit. Critics of retributive justice like Sidgwick and Rashdall believe
that all thoughtful persons reject it (pace the heirs of Kant of Hegelta)
but they regretfully acknowledge that "ordinary" people still support it.
Even Plato, on whom Rashdall relied, seems to have made room for it.
The plain fact, like it or not, is that retribution, crude or refined, has been
and is inevitable. Responsibility will vary from collective to individual,
or both may coexist, but retribution is constant. Although many academic
utilitarians continue to ignore that fact or to argue as though it an
somehow be made to disappear, non-academic utilitarians simply accept
the inevitable and try to minimize its effect when its manifestation in
specific penalties does not further deterrence or rehabilitation.
The factual inevitability of retribution supports the position I have
long advocated: (1) the primacy of retributive justice on the ground of
101. H. SxiDGWICK, THE METHODS OF ETHICS 281 (1901).
102. Rashdall, supra note 48, at 421, 422.
103. See Hall, supra note 92, at ch. 9, and consult the Index in J. HALL, LAW, SOCIAL SCIENCE
AND THEORY (1982).
104. Matthew 13: 41-44; 16:27; Mark 9:42.
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desert (guilt) and (2) the advance of the utilitarian ends of punishment
(deterrence and rehabilitation) so far as they do not trivialize or exceed
the limits ofjustice. 105 The pendulum has swung sharply in the direction
of retributive justice and, unfortunately, in recent legislation in the
United States rehabilitation has been ignored or rejected. Religion can
remind us of the importance of helping wrongdoers develop an appreciation
of moral values. Especially suggestive are modem versions of the
legal and the anti-legal interpretations of atonement. What the philosopher-king
will do in Utopia or God in heaven is a matter of faith. So far
as the secular problems of crime and punishment are concerned, legal
scholars will agree that sound positive law has great value. Still it seems
necessary to stress the fact that even the soundest penal law limits what
can be achieved in relianpe solely on it. In all world religions much emphasis
is placed on the reform of wrongdoers, thought of as turning them
from evil to goodness or as their advance in knowledge and understanding.
There can be little doubt that this aspect of religion has inspired the
reform of penal institutions and much concern for the rehabilitation of
their inmates.
105. HALL, GENERAL PRINCIPLES OF CRIMINAL LAW 130 (lst ed. 1947). 307-308 (2nd ed.
1960). This was not a discovery or a novelty. In 1797 Kant wrote: "He must first be found to be
deserving of punishment before any consideration is given to the utility of this punishment for himself
or for his fellow citizens." I. KANT, THE METAPHYSICAL ELEMENTS OF JUSTICE 100 (J. Ladd
trans. 1965).
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Attachment B
Organized Crime: An Evolving Challenge
for Law Enforcement
Page 343 of 372

Organized Crime: An Evolving Challenge for
U.S. Law Enforcement
Jerome P. Bjelopera
Specialist in Organized Crime and Terrorism
Kristin M. Finklea
Specialist in Domestic Security
January 6, 2012
CRS Report for Congress
Prepared for Members and Committees of Congress
Congressional Research Service
7-5700
www.crs.gov
R41547

Organized Crime: An Evolving Challenge for U.S. Law Enforcement
Summary
In the last two decades, organized crime has grown more complex, posing evolving challenges for
U.S. federal law enforcement. These criminals have transformed their operations in ways that
broaden their reach and make it harder for law enforcement to combat them. They have adopted
more-networked structural models, internationalized their operations, and grown more tech savvy.
They are a significant challenge to U.S. law enforcement.
Modern organized criminals often prefer cellular or networked structural models for their
flexibility and avoid the hierarchies that previously governed more traditional organized crime
groups such as the Cosa Nostra. Fluid network structures make it harder for law enforcement to
infiltrate, disrupt, and dismantle conspiracies. Many 21 st century organized crime groups
opportunistically form around specific, short-term schemes and may outsource portions of their
operations rather than keeping it all “in-house.”
Globalization has revolutionized both licit and illicit commerce. Commercial and technological
innovations have reduced national trade barriers, widened transportation infrastructure, and
bolstered volumes of international business. The Internet and extensive cellular telephone
networks have fostered rapid communication. Integrated financial systems, which allow for easy
global movement of money, are exploited by criminals to launder their illicit proceeds. Estimates
suggest that money laundering annually accounts for between 2% and 5% of world GDP.
Simultaneously, borders are opportunities for criminals and impediments to law enforcement.
Organized criminals have expanded their technological “toolkits,” incorporating technologydriven
fraud into their capabilities. Their operations can harm U.S. citizens without ever having a
physical presence in the country. These illicit activities include cyber intrusions into corporate
databases, theft of individual consumer credit card information, fencing of stolen merchandise
online, and leveraging technology to aid in narcotics smuggling. Further, criminal
organizations—which have historically burrowed into and exploited local ethnic communities—
can now rely on Internet connectivity and extensive, international transportation linkages to target
localities around the globe.
Since the terrorist attacks of September 11, 2001, there has been a shift in law enforcement
attention and resources toward counterterrorism-related activities and away from traditional crime
fighting activities including the investigation of organized crime. Although the effects of
organized crime may not be seen in a consolidated attack resulting in the physical loss of life,
they are far-reaching—impacting economic stability, public health and safety, as well as national
security.
In July 2011, the Obama Administration issued its Strategy to Combat Transnational Organized
Crime. It addresses the fact that federal investigation of organized crime matters has not
historically been a centralized effort. Regardless, there still is no single agency charged with
investigating organized crime in the way the Federal Bureau of Investigation (FBI) has been
designated the lead investigative agency for terrorism. Further, resources to tackle this issue are
divided among many federal agencies. As such, Congress may exert its oversight authority
regarding the federal coordination of organized crime investigations via the 2011 strategy.
Policymakers may also debate the efficacy of current resources appropriated to combat organized
crime.
Congressional Research Service

Organized Crime: An Evolving Challenge for U.S. Law Enforcement
Contents
Introduction...................................................................................................................................... 1
Organized Crime Adapting to Globalization ................................................................................... 2
Borders and Organized Crime ................................................................................................... 3
Copycats and Smugglers ..................................................................................................... 3
Drug Trafficking.................................................................................................................. 7
Money Laundering .............................................................................................................. 9
Organized Crime and Technological Change .......................................................................... 11
Mass Marketing Fraud ...................................................................................................... 11
Cyberspace, Electronic Information, and Organized Crime.............................................. 13
Online Identity Theft and Sophisticated Credit Card Fraud.............................................. 13
Organized Retail Crime and Online Fencing .................................................................... 15
Bulk Narcotics Smuggling and Technology...................................................................... 16
Exploitation of Ethnic Diaspora Communities........................................................................ 18
Changing Structures ................................................................................................................ 21
Network Models................................................................................................................ 22
Corruption................................................................................................................................ 24
“Ground-Level” Exploitation of Private Businesses......................................................... 24
Big Business and Organized Criminals............................................................................. 25
Corruption of Public Officials........................................................................................... 27
Organized Crime, a “National Security” and “Public Security” Concern ..................................... 28
Conceptualizing Organized Crime .......................................................................................... 29
Transnational Organized Crime Defined........................................................................... 30
Statutory Definition........................................................................................................... 34
Issues.............................................................................................................................................. 35
Defining Organized Crime in Statute................................................................................ 35
Congressional Commission............................................................................................... 36
Incentives for Investigating Organized Crime .................................................................. 37
Implementing the National Strategy to Combat TOC ....................................................... 38
Figures
Figure 1. Transnational Organized Crime Strategy ....................................................................... 34
Contacts
Author Contact Information........................................................................................................... 40
Congressional Research Service

Organized Crime: An Evolving Challenge for U.S. Law Enforcement
Introduction
In the last two decades, organized crime has grown more complex, posing evolving challenges for
U.S. federal law enforcement. This is largely because these criminals have transformed their
operations in ways that broaden their reach and make it harder for law enforcement to define and
combat the threat they pose. Globalization and technological innovation have not only impacted
legitimate commerce, but they have simultaneously revolutionized crime. In response to these
forces, organized criminals have adopted more-networked structural models, internationalized
their operations, and grown more tech savvy. Criminals have become more elusive. They see
international borders as opportunities while law enforcement views them as obstacles. Criminals
have expanded their range of tools and targets as well. Meanwhile, law enforcement “plays by
yesterday’s rules and increasingly risks dealing only with the weakest criminals and the easiest
problems,” according to the Strategic Alliance Group, a partnership of seven law enforcement
agencies from five nations. 1
Motivated by money, organized crime fills needs not met by licit market structures and/or exploits
businesses, consumers, and nations for profit. Organized criminals have capitalized on
commercial and technological advances that have bolstered communication and international
business. They use innovative methods of moving illegal proceeds around the world. Some
nations have also witnessed the creation of ties between powerful business figures, politicians,
and criminals.
Modern organized criminals may prefer cellular or networked structural models for their
flexibility and avoid the hierarchies governed by elaborate initiation rituals that were favored by
their predecessors. Fluid network structures make it harder for law enforcement to infiltrate,
disrupt, and dismantle conspiracies. Many 21 st century organized crime groups opportunistically
form around specific, short-term schemes. Further, these groups may outsource portions of their
operations rather than keeping all of their expertise “in-house.”
In July 2011, to address these and other issues, the Obama Administration issued its Strategy to
Combat Transnational Organized Crime (2011 Strategy). It described transnational organized
crime (TOC) networks as a strategic threat to national security, laid out a definition of
transnational organized crime, and set forth five policy objectives and six categories of priority
actions in an attempt to devise a cohesive federal response to transnational organized crime. 2
Complicating all of this, since the terrorist attacks of September 11, 2001 (9/11), there has been a
shift in law enforcement attention and resources more toward counterterrorism-related activities
and away from traditional crime fighting activities—including the investigation of organized
crime.
1 These law enforcement agencies include the U.S. Federal Bureau of Investigation (FBI); Drug Enforcement
Administration (DEA); Immigration and Customs Enforcement (ICE); the United Kingdom’s Serious Organised Crime
Agency (SOCA); the Australian Crime Commission and Australian Federal Police; the New Zealand Police; and the
Royal Canadian Mounted Police. See SOCA, “SOCA Working in Partnership Worldwide,” http://www.soca.gov.uk/
about-soca/working-in-partnership/international-partnerships. Intelligence Committee Futures Working Group, Crime
and Policing Futures, Strategic Alliance Group, March 2008, p. 2. (Hereafter, Intelligence Committee Futures Working
Group, Futures.)
2 For details see Strategy to Combat Transnational Organized Crime, July 2011, http://www.whitehouse.gov/sites/
default/files/Strategy_to_Combat_Transnational_Organized_Crime_July_2011.pdf. (Hereafter: Strategy to Combat
Transnational Organized Crime.)
Congressional Research Service 1

Organized Crime: An Evolving Challenge for U.S. Law Enforcement
This report provides an analysis of how organized crime has capitalized on globalization by using
borders as opportunities, relying on fast-paced technological change, and adapting its
organizational structures. It illustrates how these transformations can impact U.S. persons,
businesses, and interests. The report includes a discussion of how U.S. law enforcement
conceptualizes organized crime in the 21 st century and concludes by examining potential issues
for Congress, including the extent to which organized crime is a national security threat (partly to
be tackled by U.S. law enforcement agencies), congressional oversight regarding the federal
coordination of organized crime investigations, and the utility of current resources appropriated to
combat organized crime.
This report employs a broad conceptualization of organized crime in its narrative discussion of
criminal activity. In other words, the analysis includes groups engaged in sustained criminal
enterprises, such as—but not limited to—drug traffickers, mafia families, smugglers, violent
gangs, and fraudsters. These operations may or may not have a transnational dimension to them
(which is a requirement under the guidelines of the 2011 Strategy), but they directly impact U.S.
persons, businesses, and/or interests. While this conceptualization may be broader than the
definition laid out in the 2011 Strategy, it incorporates a range of criminality that may inform
Congress in future legislation impacting organized crime. The cases and examples discussed in
this report are not intended to set definitional boundaries for organized crime.
Organized Crime Adapting to Globalization
Organized crime targeting the United States has internationalized and its structures have flattened.
The popular image of mobsters employing elaborate initiation rituals and strict codes of conduct
to control crews that assail their own communities is outmoded. Today, nimble, adaptive, loosely
structured small groups with global reach harm consumers, businesses, and government interests
on a daily basis. Commercial and technological innovations are behind this transformation. They
have helped to reduce national trade barriers, widen transportation infrastructure, and bolster
volumes of international business. Smugglers have taken advantage of growing international
commerce to hide illicit trade. The Internet and extensive cellular telephone networks have
fostered rapid communication, simultaneously revolutionizing licit and illicit commerce. For
example, integrated financial systems allow for easy global movement of money. Estimates
suggest that money laundering annually accounts for between 2% and 5% of world GDP. 3
Criminal organizations targeting the United States operate in many of the world’s nations. Areas
wracked by social disorder, inadequate policing, and poor governance offer opportunities for
organized crime to take root. 4 These groups exploit diaspora communities in the United States as
cover for their operations, situating elements of their global operations among immigrant
enclaves.
Organized crime groups are becoming more entrepreneurial or market focused, reacting to
changes in both illicit and licit economies. 5 Of course, they are still heavily involved in activities
3 Moisės Naím, Illicit: How Smugglers, Traffickers, and Copycats are Hijacking the Global Economy (New York:
Anchor Books, 2006) p. 16. (Hereafter: Naím, Illicit.)
4 Intelligence Committee Futures Working Group, Futures, p. 5. See also United Nations Office on Drugs and Crime
(UNODC), The Globalization of Crime: A Transnational Organized Crime Threat Assessment, (Vienna: UNODC,
2010), p. 221.
5 Jharna Chatterjee, The Changing Structure of Organized Crime Groups, Royal Canadian Mounted Police, 2005, pp. 2,
(continued...)
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Organized Crime: An Evolving Challenge for U.S. Law Enforcement
such as narcotics trafficking and money laundering (which have been greatly impacted by
globalization), but organized criminals are increasingly involved in less “traditional” high-tech
operations encompassing identity theft, counterfeiting of goods, and various types of fraud.
Borders and Organized Crime
Modern organized criminals prey upon weaknesses in international transportation and customs
security regimens. 6 Border policing efforts have attempted to keep pace with the expansion of
international commerce. Organized criminals attempting to smuggle goods, people, or
information across borders also face enhanced border security regimens resulting from the
terrorist attacks of 9/11. Regardless, specialized criminal networks smuggle items such as
narcotics, counterfeit goods, stolen goods, and bulk cash, as well as humans, around the world
and into the United States. They have hidden their contraband within the growing volume of
legitimate global trade. Prior to the global recession, between 1995 and 2008 the volume of
global containerized traffic tripled. 7 Drug traffickers move large loads of cocaine, eventually
destined for U.S. markets, from South America to Mexico via containerized shipping.
International counterfeiters use containers to smuggle their fake goods into the United States. As
Moisės Naím has succinctly put it, most illicit trade involves copycats, smugglers, and
traffickers. 8 While individuals can and do engage in these activities, a good deal can be attributed
to organized crime.
Copycats and Smugglers
Criminal groups engage in counterfeiting and smuggling across and within the borders of the
United States. This activity includes a wide range of products and influences the lives of everyday
Americans, U.S. businesses, and government.
Counterfeiting and Piracy
Counterfeiting highlights the nexus between globalization and the modernization of organized
crime. Although it is difficult, if not impossible, to determine how deeply immersed organized
criminals are in this activity, at least one study has suggested serious involvement. 9 Further, in a
recent speech before the International Intellectual Property Summit, Attorney General Holder
reinforced the need for the international law enforcement community to combat “the international
networks of organized criminals now seeking to profit from IP [intellectual property] crimes.” 10
(...continued)
7-8, http://dsp-psd.pwgsc.gc.ca/Collection/PS64-9-2005E.pdf. (Hereafter: Chatterjee, The Changing Structure.)
6 For more on this, see Naím, Illicit; Melvyn Levitsky, “Transnational Criminal Networks and International Security,”
Syracuse Journal of International Law and Commerce, vol. 30, no. 2 (Summer 2003), pp. 227-240.
7 Research and Innovative Technology Administration, Bureau of Transportation Statistics, America’s Container Ports:
Freight Hubs That Connect Our Nation to Global Markets, Department of Transportation, June 2009, pp. 7-8,
http://www.bts.gov/publications/americas_container_ports/2009/pdf/entire.pdf.
8 Naím, Illicit, pp. 1-8.
9 See, for example, Gregory F. Treverton et al., Film Piracy, Organized Crime, and Terrorism, RAND Corporation,
Santa Monica, CA, 2009, p. 27, http://www.rand.org/pubs/monographs/2009/RAND_MG742.pdf. (Hereafter,
Treverton et al., Film Piracy.)
10 Department of Justice, “Attorney General Eric Holder Speaks at the International Intellectual Property Summit,”
(continued...)
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In areas such as film piracy, counterfeiting does not necessarily involve high entry costs or large
legal penalties when compared to more conventional criminal activity such as drug trafficking. 11
It is also potentially very lucrative. With little infrastructure—a high-speed Internet connection,
scanner, and copier and off-the-shelf software—criminals around the globe can easily imitate the
branding and packaging that accompanies products, let alone copy the products themselves. 12
Counterfeiting and pirating goods 13 involves the violation of intellectual property rights (IPR), 14
essential to creative and high-tech industries particularly reliant on copyrights, trademarks, and
patents to protect innovation. Counterfeiting and piracy potentially harm legitimate businesses
and consumers, sapping profits and brand value and flooding markets with inferior and even
dangerous products masquerading as legitimate goods. Aside from enforcement outlays, the
activity also costs governments tax revenue and may slow economic growth by driving down
incentives to innovate. 15
Between FY2005 and FY2008, the yearly domestic value 16 of IPR-related law enforcement
seizures of contraband in the United States leaped from $93 million to $273 million. In FY2009,
(...continued)
press release, October 18, 2010, http://www.justice.gov/iso/opa/ag/speeches/2010/ag-speech-101018.html.
11 Treverton et al., Film Piracy.
12 Treverton et al., Film Piracy, p. 3; Deputy Assistant Attorney General Criminal Division, Department of Justice,
Jason M. Weinstein, Statement Before the United States House of Representatives Committee on Oversight and
Government Reform Subcommittee on Government Management, Organization, and Procurement, Department of
Justice, Prepared Testimony “Protecting Intellectual Property Rights in a Global Economy: Current Trends and Future
Challenges,” December 9, 2009, p. 2, http://oversight.house.gov/images/stories/Hearings/Government_Management/
Intellectual_Property_Rights/Draft_DAAG_Weinstein_testimony_OMB_CLEARED_with_new_date.pdf.
13 U.S. Government Accountability Office (GAO), Intellectual Property, p. 5 offers the following definition: “‘Pirated
copyright goods’ refer to any goods that are copies made without the consent of the right holder or person duly
authorized by the right holder. ‘Counterfeit goods’ refer to any goods, including packaging or bearing without
authorization, a trademark that is identical to a trademark validly registered for those goods, or that cannot be
distinguished in its essential aspects from such a trademark, and that, thereby, infringes the rights of the owner of the
trademark in question. According to the U.S. Food and Drug Administration (FDA), ‘counterfeit drugs’ are defined
under U.S. law as those sold under a product name without proper authorization, where the identity of the source drug
is knowingly and intentionally mislabeled in a way that suggests that it is the authentic and approved product.”
14 U.S. Government Accountability Office (GAO), Intellectual Property: Observations on Efforts to Quantify the
Economic Effects of Counterfeit and Pirated Goods, GAO-1-423, April 2010, p. 5, http://www.gao.gov/new.items/
d10423.pdf defines intellectual property (IP) as “any innovation, commercial or artistic, or any unique name, symbol,
logo, or design used commercially. IP rights protect the economic interests of the creators of these works by giving
them property rights over their creations.” The report describes copyright as “[a] set of exclusive rights subsisting in
original works of authorship fixed in any tangible medium of expression now known or later developed, for a fixed
period of time. For example, works may be literary, musical, or artistic.” The report defines trademark as “[a]ny sign or
any combination of signs capable of distinguishing the source of goods or services is capable of constituting a
trademark. Such signs—in particular, words (including personal names), letters, numerals, figurative elements, and
combinations of colors, as well as any combination of such signs—are eligible for registration as trademarks.” Patents
are “[e]xclusive rights granted to inventions for a fixed period of time, whether products or processes, in all fields of
technology, provided they are new, not obvious (involve an inventive step), and have utility (are capable of industrial
application).”
15 U.S. Government Accountability Office (GAO), Intellectual Property; U.S. Chamber of Commerce, “Protecting
Intellectual Property,” pp. 9-15, http://www.uschamber.com/IP.htm. IPR infringement may also have some positive
effects for consumers who may derive benefit from the lower costs of pirated goods. Industry may also eventually
generate more sales as consumers possibly develop interest in purchasing legitimate versions of cheaper counterfeit
products they have sampled.
16 According to U.S. Customs and Border Protection, “domestic value” is the “cost of seized goods, plus the cost of
shipping and importing the goods into the U.S. and an amount for profit.”
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the domestic value of seizures dropped 4%. 17 This is likely due to the global recession. Products
originating in China—both Mainland China and Hong Kong—accounted for over 85% of these
IPR seizures in FY2008 and FY2009. 18 Two 2010 operations in the United States together netted
$240 million in counterfeit materials. The hauls included fake Rolex watches, Coach handbags,
pirated DVDs, and fake pharmaceutical products. Much of the material came from China. 19
Auto Theft Rings
Another example of organized criminals viewing borders as opportunity involves auto theft.
Although international automobile theft has existed almost as long as cars have been around, 20 the
integration of worldwide markets and expansion of international shipping have greatly impacted
it by facilitating international transport of stolen automobiles. Assessing the level of such activity
is very difficult since few metrics for it exist. Regardless, today’s international automobile theft
rings benefit from the high levels of cargo container traffic ushered in by globalization. These
groups profit by stealing vehicles in the United States and shipping them abroad, where they are
sold. Such illicit operations react to global demand for luxury vehicles, and in some instances are
extremely responsive to market forces. They trawl large U.S. metropolitan areas that have
assortments of vehicles and rely on rail or port facilities to move stolen vehicles abroad. 21
In June 2010, law enforcement officials announced indictments of 17 participants in an alleged
scheme that pilfered 450 cars annually in New York, New Jersey, and Connecticut. According to
law enforcement officials, the group, described as a “steal to order” outfit by New York State
Attorney General Andrew Cuomo, filled specific requests from U.S. customers and others in
Senegal and netted up to $25,000 per car. The group supposedly relied on specialists who could
reprogram car keys to match a vehicle’s specific code, exporters, and two car dealership
employees, among others. The ring allegedly stored vehicles in four Bronx, NY, garages and
loaded those destined for Senegal into shipping containers, concealing the cars behind furniture. 22
17 U.S. Customs and Border Protection, “Yearly Comparisons: Seizure Statistics for Intellectual Property Rights (FY
2005-FY2009),” January 2010, http://www.cbp.gov/xp/cgov/trade/priority_trade/ipr/seizure/seizure_stats.xml; U.S.
Customs and Border Protection, U.S. Immigration and Customs Enforcement, “Intellectual Property Rights Seizure
Statistics: FY 2009,” October 2009, p. 2, http://www.cbp.gov/linkhandler/cgov/trade/priority_trade/ipr/seizure/
fy09_stats.ctt/fy09_stats.pdf; U.S. Customs and Border Protection, U.S. Immigration and Customs Enforcement,
“Intellectual Property Rights Seizure Statistics: FY 2008,” January 2009, p. 2, http://www.cbp.gov/linkhandler/cgov/
trade/priority_trade/ipr/seizure/fy08_final_stat.ctt/fy08_final_stat.pdf.
18 U.S. Customs and Border Protection, U.S. Immigration and Customs Enforcement, “Intellectual Property Rights
Seizure Statistics: FY2009,” October 2009, p. 12, http://www.cbp.gov/linkhandler/cgov/trade/priority_trade/ipr/pubs/
seizure/fy09_stats.ctt/fy09_stats.pdf; U.S. Customs and Border Protection, U.S. Immigration and Customs
Enforcement, “Intellectual Property Rights Seizure Statistics: FY2008,” January 2009, p. 13, http://www.cbp.gov/
linkhandler/cgov/trade/priority_trade/ipr/pubs/seizure/fy08_final_stat.ctt/fy08_final_stat.pdf.
19 Keith Johnson, “U.S. Seizes Big Batches of Fake Goods,” Wall Street Journal, April 26, 2010.
20 See “Stolen American Autos Clog the Mexican Market,” New York Times, February 5, 1922,
http://query.nytimes.com/mem/archive-free/pdf?res=9D0DE5D71130EE3ABC4D53DFB4668389639EDE.
21 Eva Dou, “New-York Based Theft Ring Shipped Hot Cars to Senegal,” Associated Press, June 30, 2010.
22 Ibid; Rob Sgobbo, Joe Jackson, and Brendan Brosh, “U.S. to Senegal Car Theft Ring Busted, Attorney General
Andrew Cuomo Says,” New York Daily News, June 30, 2010.
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Human Smuggling and Trafficking
Criminal organizations are taking advantage of an unprecedented era of international migration,
including illegal migration to the United States. 23 However, since 2007 illegal immigration to the
United States has declined. 24 This may be attributable, in part, to dwindling job opportunities
resulting from the global recession and increased immigration enforcement activity along the U.S.
Southwest border. 25 Nonetheless, criminal organizations continue to capitalize on the desire of
unauthorized immigrants to enter the United States. Networks of human smugglers and others—
including Mexican drug trafficking organizations (DTOs) that have broadened their moneygenerating
activities to include human and weapon smuggling, counterfeiting, kidnapping for
ransom, and extortion—bring unauthorized immigrants across the border and into the United
States. 26 In one well-known case, Cheng Chui Ping—also known as “Sister Ping”—sentenced in
March 2006, had led an international human smuggling ring that was responsible for smuggling
Chinese villagers to the United States between the early 1980s and April 2000. In a 2006 press
release, the Department of Justice (DOJ) described her as “one of the first, and ultimately most
successful, alien smugglers of all time.” 27 At the start, Ping’s smuggling ring brought small
numbers of villagers to the United States via aircraft, using fake immigration documents. She
turned from exclusive reliance on air transit to include the use of maritime shipping as her
operation matured. This way, Ping likely exploited increasing volumes of international seaborne
cargo engendered by globalization to mask her illegal movement of human beings. She eventually
developed the capability to smuggle hundreds of victims at a time via cargo ships, where the
villagers could be stashed below the deck until they reached their U.S. destination and eventually
paid her exorbitant smuggling fees. 28 Criminals who smuggle individuals into the United States
may also turn the smuggling into a trafficking situation by increasing the immigrants’ debts owed
once they have been smuggled to the United States. The smugglers/traffickers may then require
their victims to work for a period of time to pay off the debts. 29
Organized crime exploits individuals through both labor and sex trafficking. In 2006, the FBI
reported that human trafficking generates about $9.5 billion for organized crime annually. 30
23 Naím, Illicit p. 89; Jackie Turner and Liz Kelly, “Intersections Between Diasporas and Crime Groups in the
Constitution of the Human Trafficking Chain,” British Journal of Criminology, vol. 49, no. 2 (March 2009), p. 184.
24 Jeffrey S. Passel and D'Vera Cohn, U.S. Unauthorized Immigration Flows Are Down Sharply Since Mid-Decade,
Pew Hispanic Center, Report, Washington, DC, September 1, 2010, p. i, http://pewhispanic.org/files/reports/126.pdf.
25 Miriam Jordan, “Illegal Immigration to U.S. Slows Sharply,” Wall Street Journal, September 1, 2010,
http://online.wsj.com/article/SB10001424052748703882304575465742670985642.html?mod=googlenews_wsj.
26 Also, while some drug trafficking organizations may not be directly involved in human smuggling, they may tax the
smugglers who wish to use the established drug trafficking routes. For details on Mexican cartels and human
smuggling, see David Luhnow and Jose De Cordoba, “Mexican Military Finds 72 Bodies Near Border,” Wall Street
Journal, August 26, 2010, http://online.wsj.com/article/
SB10001424052748703632304575450761550490920.html#articleTabs%3Darticle; Josh Meyer, “Drug Cartels Raise
the Stakes on Human Smuggling,” Los Angeles Times, March 23, 2009, http://articles.latimes.com/2009/mar/23/nation/
na-human-smuggling23.
27 Department of Justice, “Sister Ping Sentenced to 35 Years in Prison for Alien Smuggling, Hostage Taking, Money
Laundering, and Ransom Proceeds Conspiracy,” press release, March 16, 2006, http://www.justice.gov/usao/nys/
pressreleases/March06/sisterpingsentencingpr.pdf.
28 Ibid.
29 Department of Justice, “Hudson County Bar Owner Pleads Guilty to Role in International Human Smuggling Ring,”
press release, September 12, 2006, http://www.justice.gov/usao/nj/press/files/pdffiles/medr0912rel.pdf.
30 Department of State, Trafficking In Persons Report 2006, June 2006, p. 13, http://www.state.gov/documents/
organization/66086.pdf.
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However, as the Government Accountability Office (GAO) has noted, estimates regarding the
global scale of human trafficking are questionable; 31 as such, any estimates regarding the
proceeds generated through these crimes may not be representative of their true scope. These
criminal organizations target both U.S. citizens and foreign nationals who are drawn to visions of
better lives in the United States.
International borders often play a central role in the dynamics involved in forced labor and sex
trafficking. In many instances, victims likely perceive borders and border security regimens as
insurmountable barriers via legitimate means, requiring them to turn to illicit methods of transit
offered by traffickers. Organized criminals prey on victims’ powerful desires to live or work in
other countries. While the following two cases may not have been prosecuted by DOJ as
traditional “organized crime,” the networks involved highlight some of the dynamics involved in
labor and sex trafficking. In August 2010, federal law enforcement announced an indictment of
six individuals for participation in an alleged conspiracy to exploit Thai nationals through forced
labor in the United States. The defendants allegedly enticed workers to the United States by
offering opportunities for lucrative jobs. Once in the United States, the approximately 400 Thai
workers had their passports confiscated, were threatened with economic harm and deportation,
and were forced to work on farms in Washington and Hawaii. 32 In another case, four individuals
from the United States, Mexico, and Guatemala were sentenced in April 2010 for involvement in
a sex trafficking organization that targeted young Mexican women. They lured these women to
the United States on the promise of better lives or legitimate employment. Once the women were
brought to the United States, they were instead physically threatened, beaten, intimidated, and
forced to engage in commercial sex. 33 DOJ has also reported an uptick in Asian organized crime
groups becoming involved as pimps or brokers in domestic human sex trafficking. Although the
increase is noted for Asian organized crime groups, involvement in sex trafficking is certainly not
limited by ethnic or geographic origin; these criminals collaborate with other, non-Asian groups
to further their sex trafficking enterprises. 34
Drug Trafficking
In the last decade, cocaine has become a truly global commodity dependent on illicit market
fluctuations. Traffickers now can leverage wide, international distribution networks to ride out
pressures or changes that may make their traditional illicit markets less hospitable. According to
media reports, some Colombian and Mexican cocaine suppliers have shifted sizeable amounts of
product using containerized shipping—hiding their illicit material within the daily globalized
flow of legitimate seaborne international commerce. 35 And some of the Mexican Gulf Cartel’s
31 Government Accountability Office (GAO), Human Trafficking: Better Data, Strategy, and Reporting Needed to
Enhance U.S. Antitrafficking Efforts Abroad, GAO-06-825, July 2006, http://www.gao.gov/new.items/d06825.pdf.
32 Department of Justice, “Six People Charged in Human Trafficking Conspiracy for Exploiting 400 Thai Farm
Workers,” press release, September 2, 2010, http://www.justice.gov/opa/pr/2010/September/10-crt-999.html. For
another case involving forced labor, see Department of Justice, “Uzbek Man Sentenced for Role in Multi-National
Racketeering and Forced Labor Enterprise,” press release, May 9, 2011, http://www.justice.gov/opa/pr/2011/May/11-
crt-589.html.
33 Department of Justice, “Four Defendants Sentenced to Prison in Human Trafficking Ring,” press release, April 28,
2010, http://www.justice.gov/usao/gan/press/2010/04-28-10.pdf.
34 Comments by DOJ officials at the 2010 National Conference on Human Trafficking, May 3–5, Arlington, VA.
35 Mark Townsend, “How Liverpool Docks Became a Hub of Europe’s Deadly Cocaine Trade,” The Guardian, May
16, 2010.
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smuggling activity involving European markets has used the United States as a transshipment
point. 36
When it comes to the internationalization of cocaine markets, not all the news involves the
growth of supply, however. Global demand for cocaine has partly impacted U.S. bound supplies
of the drug. Cocaine availability levels in the United States have decreased since 2006. Diversion
of cocaine to European and Latin American markets by Colombian and Mexican drug cartels has
fueled this downturn in availability, as have coca eradication efforts, large seizures, law
enforcement pressure on Mexican cartels, and violent inter-cartel rivalries. 37
While the story of globalized drug smuggling impacting the United States often revolves around
Colombian and Mexican cartels specializing in drugs such as cocaine, marijuana, heroin, and
methamphetamine, criminal groups trafficking narcotics come in all sizes and handle a variety of
drugs. Because of the ease of international communications, travel, and transportation networks
inherent in globalization, drug trafficking groups need not be directly tied to the large cartels to
have significant worldwide reach. Even relatively small groups can forge far-flung supply and
transportation links.
The FBI’s operation Black Eagle tracked a small Albanian network of alleged criminals based in
northern New Jersey who were indicted in March 2009. 38 The network purportedly had domestic
ties to Chicago, Detroit, and Texas, as well as international links to Macedonia and Albania. At
one point, the group of opportunists supposedly conspired to smuggle 100 kilograms of heroin
from Albania to the United States. According to the FBI, the group planned to use a Balkan front
company to conceal the heroin in containerized shipments of furniture bound for the United
States. The heroin was purportedly to come from Afghanistan, likely via Turkey and into Albania.
There was no clear cut leadership in the loosely knit group. The heroin deal was going to be one
last score before some of the criminals “retired,” according to the FBI. They were also likely
involved with stealing and selling pharmaceuticals, illegal gambling, dealing ecstasy, and theft of
retail goods. 39
In another case involving a relatively small group, Phuong Thi Tran pleaded guilty in February
2010 for her involvement in what has been described in press reports as an Asian drug trafficking
ring that smuggled ecstasy pills and other drugs into the United States from Canada, where they
were manufactured. Tran, who lived in Canada, is originally from Vietnam and served as the
36 Michele M. Leonhart, DEA Acting Administrator, “Prepared Remarks: Project Reckoning Press Conference,”
September 17, 2008, http://www.justice.gov/dea/speeches/s091808.html.
37 National Drug Intelligence Center, National Drug Threat Assessment, February 2010, p. 29, http://www.justice.gov/
ndic/pubs38/38661/38661p.pdf.
38 Federal Bureau of Investigation, Newark Division, “Federal Agents Shut Down International Smorgasbord of
Crime,” press release, March 18, 2009, http://newark.fbi.gov/pressrel/pressrel09/nk031809.htm.
39 Federal Bureau of Investigation, “Inside the FBI: Albanian Organized Crime,” November 27, 2009,
http://www.fbi.gov/inside/archive/inside112709.htm. For more on Albanian organized crime activity in the United
States see Department of Justice, “Two Leaders of Violent Albanian Drug Gang Found Guilty in Manhattan Federal
Court,” press release, December 7, 2011, http://www.fbi.gov/newyork/press-releases/2011/two-leaders-of-violentalbanian-drug-gang-found-guilty-in-manhattan-federal-court;
Department of Justice, “Sixteen Members of International
Organized Crime Group Charged with Kidnapping, Narcotics, Robbery and Firearms Crimes,” press release, June 8,
2010, http://www.fbi.gov/newyork/press-releases/2010/nyfo060810.htm.
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group’s ringleader. She oversaw an operation that smuggled millions of ecstasy pills into the
United States between 2002 and 2008, when she was arrested. 40
Money Laundering
Making ill-gotten gains appear legitimate is critical to the success of organized criminals. For
many criminals, the movement of money—either as bulk cash or digital transactions—across
international borders plays an integral role in this process. They use many techniques to launder
money, often exploiting legitimate financial structures to mask the illegal origins of their profits.
Money laundering includes three fundamental steps: (1) placement, the introduction of illicit
funds into licit financial systems; (2) layering, the movement (often international) of illicit funds
through a variety of business structures to obscure its origins; and (3) integration, the use of illicit
funds that at this stage appear legitimate in lawful business transactions. 41 It is impossible to
determine with any accuracy how much money is laundered by organized criminals whose
operations impact the United States. However, U.S. government estimates suggest that Mexican
and Columbian drug trafficking organizations earn between $18 billion and $39 billion annually
from sales in the United States. 42 Annually, perhaps between $20 billion and $25 billion in bank
notes is smuggled across the Southwest border into Mexico. 43 How much of this is profit and then
laundered is unclear. 44 While bulk cash smuggling is an important means by which criminals
move illegal profits from the United States into Mexico, they have increasingly turned to storedvalue
cards 45 to move money. With these cards, criminals are able to avoid the reporting
requirement under which they would have to declare any amount over $10,000 in cash moving
across the border. 46 Aside from bulk cash smuggling and stored-value cards, Mexican traffickers
move and launder money by using digital currency accounts, e-businesses that facilitate money
transfers via the Internet, online role-playing games or virtual worlds that enable the exchange of
game-based currencies for real currency, and “mobile payments through cell phones that provide
40 Department of Justice, “Ringleader of International Drug Trafficking Ring Pleads Guilty for Role in Drug Smuggling
Case,” press release, February 24, 2010, http://www.justice.gov/usao/pae/News/Pr/2010/feb/
tran_guilty_plea_release.pdf; Troy Graham, “Woman at Center of Asian Drug-Trafficking Ring Gets Nearly Six Year
Term,” Philadelphia Inquirer, August 25, 2010, http://www.philly.com/inquirer/local/
20100825_Woman_at_center_of_Asian_drug-trafficking_ring_gets_nearly_six-year_term.html.
41 Brian Seymour, “Global Money Laundering,” Journal of Applied Security Research, vol. 3, no. 3-4 (2008), pp. 374-
375. (Hereafter, Seymour, “Global Money.”)
42 Dennis C. Blair, Director of National Intelligence, “Annual Threat Assessment of the US Intelligence Community for
the Senate Select Committee on Intelligence,” Office of the Director of National Intelligence, February 2, 2010, p. 31.
(Hereafter, Blair, “Annual Threat Assessment.”)
43 William Booth and Nick Miroff, “Stepped-Up Efforts by U.S., Mexico Fail to Stem Flow of Drug Money South,”
Washington Post, August 25, 2010, http://www.washingtonpost.com/wp-dyn/content/article/2010/08/25/
AR2010082506161.html.
44 For a discussion of estimates, see Douglas Farah, Money Laundering and Bulk Cash Smuggling: Challenges for the
Mérida Initiative, Woodrow Wilson International Center For Scholars, Mexico Institute and University of San Diego
Trans-Border Institute, Working Paper Series on U.S.-Mexico Security Cooperation, Washington, DC, May 2010, p. 6,
http://wilsoncenter.org/topics/pubs/Money%20Laundering%20and%20Bulk%20Cash%20Smuggling.%20Farah.pdf.
(Hereafter, Farah, Money Laundering.)
45 A stored value card looks like a debit or credit card, but stores value directly on the card using magnetic strip
technology.
46 Legislation has been introduced in the 111 th Congress (H.R. 5127) that would, among other things, classify stored
value cards as monetary instruments in order to require individuals to declare to Customs over $10,000 that they are
carrying on a stored value card.
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Organized Crime: An Evolving Challenge for U.S. Law Enforcement
traffickers with remote access to existing payment mechanisms such as bank and credit card
accounts and prepaid cards.” 47
Organized criminals also use the globalized international financial system in the layering stage of
money laundering. The United States is impacted by this from at least two directions. Criminals
operating abroad can exploit U.S. structures to launder money while those operating domestically
can wash their illicit profits abroad in an attempt to avoid U.S. law enforcement. Large financial
markets such as New York, where criminal activity is potentially hidden within voluminous
legitimate business, are used by criminals. Criminals use banks and businesses to launder money
in offshore locations with strict privacy laws such as Panama, the Cayman Islands, or the Isle of
Man. In these locales, law enforcement struggles to determine the true ownership of assets. 48
International or domestic shell companies can be used for money laundering. They are legal
entities that have no independent operations or assets of their own and largely exist only on paper.
Shell companies have legitimate purposes, for example, “they may be formed to obtain financing
prior to starting operations.” 49 Regardless, DOJ has identified U.S.-based shell companies as
especially difficult to investigate because “lax company formation laws [allow] criminals [to]
form [them] quickly and cheaply and obtain virtual anonymity.” 50
Organized criminals likely rely on the veneer of legitimacy conferred by U.S.-based shell
companies, which in many instances allow criminals to conceal their ownership. 51 Most U.S.
states do not require owner information when companies are formed or even on annual or
biennial reports. 52 Individuals can distance themselves from the actual formation of specific shell
companies by using company formation agents (registered agents) to establish them. Shell
companies enable criminals to move money around the globe through legitimate bank accounts
without attracting law enforcement scrutiny. With relative ease, a criminal organization can open
multiple shell companies worldwide and systematically distance ill-gotten gains from their
criminal origins, leaving behind a hard-to-untangle web of accounts, legitimate corporations, and
transactions. 53 Both Mexico’s Sinaloa Cartel and alleged Eurasian organized crime figure Semion
Mogilevich have likely used U.S. shell companies to launder money. 54
47 Farah, Money Laundering, 23.
48 Seymour, “Global Money,” pp. 375-376.
49 U.S. Government Accountability Office (GAO), Company Formations: Minimal Ownership Information Is Collected
and Available, GAO-06-376, April 2006, p. 1, http://www.gao.gov/new.items/d06376.pdf. Hereafter GAO, Company
Formations.
50 Jennifer Shasky Calvery, Senior Counsel to the Deputy Attorney General, Department of Justice, Statement Before
the United States Senate Committee on Homeland Security and Governmental Affairs, Hearing, “Examining State
Business Incorporation Practices: A Discussion of the Incorporation Transparency and Law Enforcement Assistance
Act,” June 18, 2009, pp 1-2, http://www.justice.gov/ola/testimony/111-1/2009-06-18-dag-shasky-incorporation.pdf.
(Hereafter, Shasky, “Examining State Business.”)
51 GAO, Company Formations, p. 1.
52 GAO, Company Formations, p. 13.
53 Shasky, “Examining State Business,” pp. 4-5; Seymour, “Global Money,” p. 375.
54 Jennifer Shasky, Senior Counsel to the Deputy Attorney General, Department of Justice, Statement Before the
United States Senate Committee on Homeland Security and Governmental Affairs, Hearing, “Business Formation and
Financial Crime: Finding a Legislative Solution,” November 5, 2009, p. 1, http://hsgac.senate.gov/public/index.cfm?
FuseAction=Hearings.Hearing&Hearing_ID=88d1a5fb-7312-4e9e-92b2-8558ccd44f22. Legislation has been
introduced in the 111 th Congress (S. 569, H.R. 6098) that would establish uniform requirements for states regarding
beneficial ownership of public corporations and limited liability companies.
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Organized Crime and Technological Change
Organized criminals have expanded their technological “toolkits.” They have adapted to
incorporate technology-driven fraud into their capabilities. 55 Their operations can harm U.S.
citizens without ever having a physical presence in the country. Organized crime groups engage
in a wide variety of tech savvy mass marketing frauds. Even traditional arenas of criminal activity
such as illegal gambling have been transformed by the Internet. For example, illegal gambling has
been a staple in the Cosa Nostra’s criminal diet for decades. In recent years, they have branched
out into Internet gambling, 56 which debuted in the mid 1990s. 57 Operation Heat, an investigation
by the New Jersey Division of Criminal Justice, led to the arrest of Brian Cohen, who allegedly
facilitated the Lucchese family’s offshore gambling activities. According to law enforcement
officials, the family earned billions of dollars via offshore Internet activity that included a website
and a Costa Rican wire room that handled transactions, both managed by Cohen. 58
Mass Marketing Fraud
The International Mass-Marketing Fraud Working Group defines mass marketing fraud as
Fraud schemes that use mass-communications media—including telephones, the Internet,
mass mailings, television, radio, and even personal contact—to contact, solicit, and obtain
money, funds, or other items of value from multiple victims in one or more jurisdictions. 59
Mass marketing fraud involves a wide range of criminal activity that has been transformed by
globalization and technological change. It can be perpetrated by individuals, small groups, or
sophisticated criminal enterprises. Parsing out exactly how much of this activity can be attributed
to organized criminals is tricky, but experts suggest that “fraudulent mass marketing operations
are increasingly transnational, interconnected, and fluid.” 60 “Boiler room” scams, one iteration of
the fraud with a long history, entail groups of fraudsters making high-pressure deceptive
merchandise pitches and misleading service offers to unwitting customers around the world.
Recently, criminals have innovated based on tried-and-true boiler room schemes by outsourcing
some activity to specialists, internationalizing their operations, and adopting sophisticated
concealment strategies for their communications capabilities and locations.
55 Criminal Intelligence Service Canada (CISC), 2010 Report on Organized Crime, May 2010, p. 12,
http://www.cisc.gc.ca/annual_reports/annual_report_2010/document/report_oc_2010_e.pdf. (Hereafter, CISC, 2010
Report.)
56 For information on unlawful Internet gambling, see CRS Report RS22749, Unlawful Internet Gambling Enforcement
Act (UIGEA) and Its Implementing Regulations, by Brian T. Yeh and Charles Doyle.
57 On the advent of Internet gambling, see David G. Schwartz, Roll the Bones: The History of Gambling, (New York:
Gotham Books, Penguin Group (USA), 2006) pp. 488-494.
58 George Anastasia, “Officials Charge Man Who Allegedly Ran Mob Gambling Website,” Philadelphia Inquirer, May
29, 2010, http://www.philly.com/inquirer/local/nj/
20100529_Officials_charge_man_who_allegedly_ran_mob_gambling_website.html.
59 International Mass-Marketing Fraud Working Group (IMMFWG), Mass-Marketing Fraud: A Threat Assessment,
June 2010, p. 3. (Hereafter, IMMFWG, Mass Marketing Fraud.) The IMMFWG includes law enforcement, regulatory,
and consumer protection agencies from Australia, Belgium, Canada, the Netherlands, Nigeria, the United Kingdom,
and the United States. Europol is also involved.
60 IMMFWG, Mass Marketing Fraud, p. 14.
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The Cosa Nostra and other organized criminals use boiler rooms. 61 In June 2010, the FBI raided
an alleged boiler room operation involving Anthony Guarino, a purported Bonnano family
soldier. According to law enforcement officials, the boiler room hoodwinked elderly investors
into buying shares of companies, and 40% of the money taken in was handed over to the boiler
room operators as commissions. 62
Technology Transforms Advance Fee Fraud (AFF)
Since the 1970s, technological advancements have revolutionized advance fee fraud (AFF)
operations—a form of mass marketing fraud used by criminal organizations and individual
fraudsters. Today, these schemes often involve criminals appealing for money via unsolicited
(spam) emails. These emails typically request an initial cash payment from recipients. The initial
cash payment supposedly facilitates the disbursement of a much larger sum of money to the email
recipients. 63 The later sum never arrives. A recent AFF email scam attempting to dupe people into
believing they had been contacted by the FBI’s Detroit Field Office asked email recipients to
forward $14,300 in return for the release of over $18 million to their accounts. In one of the
emails associated with this scheme, the fraudsters suggest that “the International clamp down on
Terrorist [sic]” has frozen the larger pot of money. 64
Also known as “419 scams” after a section in the Nigerian criminal code, the broad outlines of
the modern version of AFF originated in Nigeria during the 1970s and early 1980s, and perhaps
even earlier. AFF’s original incarnation may stretch back to the 1500s in the “Spanish Prisoner”
scheme. Wealthy English business owners were asked to help pay for a rescue mission to save
someone held captive in Spain. In return, they would supposedly receive part of the vast alleged
reward payment. Of course, it never came. 65 In the late 1970s and early 1980s, Nigerian
fraudsters became known for mailing unsolicited letters requesting monetary assistance in
transferring frozen or hidden funds out of West African countries. When fax machines became
commonplace, perpetrators quickly reached many more victims with less effort. The Internet and
email further revolutionized AFF operations.
Today, these schemes are global, emanating from many other countries. 66 The spamming
networks involved often have short lives focusing on specific schemes. 67 Recent estimates
suggest that AFF networks may have swindled over $2 billion from U.S. companies and citizens
in 2009. 68 In July 2011, six defendants were sentenced for running an AFF scam that duped U.S.
61 Ibid.
62 Chad Bray, “FBI Raids Alleged Boiler Room,” Wall Street Journal, June 10, 2010, http://online.wsj.com/article/
SB10001424052748703890904575297220025441524.html.
63 Federal Bureau of Investigation, “Common Fraud Schemes,” http://www.fbi.gov/majcases/fraud/fraudschemes.htm.
64 Federal Bureau of Investigation, Detroit Division, “Scam E-Mail/Letter Claiming To Be Associated with FBI Detroit
SAC Arena,” press release, May 25, 2010, http://detroit.fbi.gov/pressrel/pressrel10/de052510.htm.
65 Harvey Glickman, “The Nigerian ‘419’ Advance Fee Scams: Prank or Peril?,” Canadian Journal of African Studies,
vol. 39, no. 3 (2005), pp. 463-476.
66 Edward Fokuoh Ampratwum, “Advance Fee Fraud, ‘419,’ and Investor Confidence in the Economies of Sub-
Saharan Africa (SSA) ,” Journal of Financial Crime, vol. 16, no. 1 (2009), pp. 68-69.
67 Matthew Zook, “Your Urgent Assistance Is Required: The Intersection of 419 Spam and New Networks of
Imagination,” Ethics, Place, and Environment, vol. 10, no. 1 (March 2007), pp. 66-70.
68 Jeremy Kirk, “Advance Fee Fraud Scams Rise Dramatically in 2009,” Compuworld, January 28, 2010,
http://www.computerworld.com/s/article/9149890/Advance_fee_fraud_scams_rise_dramatically_in_2009.
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sweepstakes participants into believing that they had won substantial cash prizes. This money
would have purportedly been sent to the victims once they paid the required taxes and fees.
Ultimately, there was no lottery prize, and the fraud netted about $2 million. 69 Estimates indicate
that today’s AFF networks only need to dupe 1% of the people or businesses they reach to turn a
profit. 70
Cyberspace, Electronic Information, and Organized Crime
As the history of AFF may indicate, organized criminals have adapted to the digital age by
becoming expert at stealing information stored and shared electronically. Many are adept at
manipulating and defrauding victims in the virtual world. All of this covers a range of activity
including cyber intrusions into corporate databases, the theft of individual consumer credit card
information, and a wide variety of fraudulent online activity. The criminal groups operating in
cyberspace can be broken into two categories: (1) part-timers—those who leverage digital
information to enhance other activities, and (2) full-timers—those who solely commit and
specialize in online or digital crimes. 71 While this is a helpful distinction to draw for discussion
purposes, it is difficult to attribute specific volumes of criminal activity to each category of
actors. General statistics suggest that organized criminals from both categories play a large role in
online data theft. For instance, in selected data breaches investigated by Verizon and the U.S.
Secret Service (USSS) involving businesses around the globe during 2009, 85% of compromised
computer records were attributed to organized crime. As 94% of all compromised records in this
study were in the financial services sector, many of those records targeted by organized criminals
were likely from financial organizations as well. 72
Online Identity Theft and Sophisticated Credit Card Fraud
Organized criminals are involved in stealing the identities of online consumers and have engaged
in technologically advanced credit card fraud. These illicit ventures pilfer from the bank accounts
of ordinary citizens and often cast a wide net to maximize the number of victims.
Some organized crime groups have stolen money from victims on intenet auction sites such as
eBay. For example, on March 13, 2010, Georgi Boychev Georgiev, a Bulgarian national pleaded
guilty in U.S. federal court to laundering money for a transnational criminal network involved in
eBay fraud. The scam did not physically exist in the United States, but it accrued more than $1.4
69 Federal Bureau of Investigation, “Six Defendants Sentenced in Manhattan Federal Court for Their Involvement in a
Multi-Million-Dollar Lottery Telemarketing Fraud Scheme,” press release, July 1, 2011, http://www.fbi.gov/newyork/
press-releases/2011/six-defendants-sentenced-in-manhattan-federal-court-for-their-involvement-in-a-multi-milliondollar-lottery-telemarketing-fraud-scheme.
70 Blaise J. Bergiel, Erich B. Bergiel, and Phillip W. Balsmeir, “Internet Cross Border Crime: A Growing Problem,”
Journal of Website Promotion, vol. 3, no. 3/4 (2008), p. 135.
71 This parallels the first two elements in Kim-Kwang Raymond Choo’s three-part typology of criminal activity in
cyberspace. The typology includes “(1) traditional organized crime groups which make use of ICT [information and
communications technologies] to enhance their terrestrial criminal activities; (2) organized cybercrime groups which
operate exclusively online; and (3) organized groups of ideologically and politically motivated individuals who make
use of ICT to facilitate their criminal conduct.” See Kim-Kwang Raymond Choo, “Organized Crime Groups in
Cyberspace: A Typology,” Trends in Organized Crime, vol. 11, no. 3 (September 2008), pp. 271.
72 Wade Baker et al., 2010 Data Breach Investigations Report: A Study Conducted by the Verizon RISK Team in
Cooperation with the United States Secret Service, Verizon, July 2010, pp. 2-15, http://www.verizonbusiness.com/
resources/reports/rp_2010-data-breach-report_en_xg.pdf.
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million from U.S. victims in 2005 and 2006. The network posted fraudulent advertisements on
eBay and used a ruse dubbed “eBay Secure Traders” to bilk people out of cash that was wired
directly into Eastern European bank accounts. 73 In another case from April 2010, Romanian law
enforcement, the FBI, and USSS cooperated in the dismantling an alleged eBay fraud ring that
purportedly involved 70 individuals from what have been described in media sources as three
different organized cybercrime groups. According to news reports, the scheme included hijacking
the eBay accounts of legitimate consumers and then using the hijacked accounts to stage fake
sales of non-existent merchandise on eBay. Fraudsters purportedly scammed bidders from Spain,
Italy, France, New Zealand, Denmark, Sweden, Germany, Austria, Canada, Switzerland, and the
United States, generating $1 million in profits since 2006. 74
Eurasian criminals in California are engaging in identity theft in which they leverage
technological savvy, old-school organized crime strategies, and Internet connectivity to reap
thousands of dollars in profits. In 2009 in the city of Redondo Beach in Southern California,
Armenian or Russian criminals allegedly targeted a gas station with an Armenian owner
(exploiting their own ethnic group). They placed one of their crew members as an employee at
the station, where he implanted high-tech skimming devices at gas pumps to steal customer credit
card information, victimizing more than 1,000 individuals, including Redondo Beach police
officers. The employee quit work and the group made off with more than $300,000 from people’s
accounts. 75 Another case, this time in the Las Vegas area in 2008, involved an alleged Armenian
criminal group that reportedly skimmed more than 1,000 credit and debit cards using insiders at
restaurants, bars, and smoke shops. In some instances, the crew manufactured its own cards using
stolen information. 76 Losses approached $1.5 million. 77 In 2009, Las Vegas authorities also
uncovered a skimming scheme complete with a credit card manufacturing lab. 78 This crew used
skimmers that captured information from magnetic strips on credit cards as well as pin numbers
using a camera. 79
73 Department of Justice, “Foreign National Pleads Guilty for Role in International Money Laundering Scheme
Involving More than $1.4 Million in Losses to Victims,” press release, May 13, 2010, http://www.justice.gov/opa/pr/
2010/May/10-crm-568.html.
74 Angela Moscaritolo, “Romanian Police, FBI Break Up 70-Strong eBay Fraud Ring,” SC Magazine, April 7, 2010,
http://www.scmagazineus.com/romanian-police-fbi-break-up-70-strong-ebay-fraud-ring/article/167554/.
75 Paul Teetor, “Russian or Armenian Mob Used ‘Model Employee’ Con at PCH Arco,” LA Weekly, June 18, 2009.
76 Lawrence Mower, “ID Theft Operation Outlined,” Las Vegas Review-Journal, December 8, 2008.
77 “Eurasian Organized Crime Task Force Members Arrest 12 Individuals Following Federal Credit Card Fraud and
Identity Theft Charges,” States News Service, December 9, 2008. See also: Department of Justice, “Men Sentenced for
Credit Card Fraud Conspiracy,” press release, June 10, 2011, http://www.justice.gov/usao/nv/press/june2011/
palikyan06102011.htm.
78 “Three Arrested in Credit Card Forgery Ring,” KTNV ABC, March 26, 2009.
79 “18 Month Credit Card Fraud Ring Leads to Three Arrests,” KTNV ABC, March 25, 2009. Additionally, in February
2011, DOJ announced an indictment charging 29 defendants tied to an organized crime group called “Armenian
Power” or “AP.” DOJ noted “Among the conspiracies charged in the racketeering indictment is a bank fraud and
counterfeit credit card scheme that victimized hundreds of customers of 99 Cents Only Stores throughout Southern
California. AP members allegedly caused more than $2 million in losses when they secretly installed sophisticated
‘skimming’ devices to steal customer account information at cash registers and then used the skimmed information to
create counterfeit debit and credit cards.” See Department of Justice, “Armenian Power Organized Crime Group
Targeted in Federal Indictments That Allege Racketeering Offenses, Including Bank Fraud Schemes, Kidnappings, and
Drug Trafficking,” press release, February 16, 2011, http://www.fbi.gov/losangeles/press-releases/2011/la021611.htm.
For another case involving skimming, see Department of Justice, “Rancho Cordova Man Arrested for Identity Theft
and Trafficking in Counterfeit Credit Card Information,” press release, April 21, 2011, http://www.justice.gov/usao/
cae/news/docs/2011/04-21-11AvagyanIndictment.html.
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In March 2010, Albert Gonzalez, the leader of the largest identity theft and retail hacking ring
prosecuted by the United States, was sentenced to 20 years in prison. 80 Through “wardriving”—a
technique in which individuals drive around in a car with a laptop computer and search for
unsecured wireless networks—the ring hacked into credit card payment systems at retailers
including TJX Companies, BJ’s Wholesale Club, OfficeMax, Boston Market, Barnes & Noble
and Sports Authority, and stole more than 40 million credit and debit card numbers. Gonzalez
also provided malware to hackers to aid them in evading anti-virus programs and firewalls in
order to access companies’ networks and payment systems. The conspirators, located in the
United States, Ukraine, and Estonia, laundered their illicit proceeds through banks in Eastern
Europe.
Organized Retail Crime and Online Fencing
While not necessarily viewed as “organized crime” by U.S. law enforcement agencies, as its
name implies organized retail crime (ORC), or organized retail theft, bears some of the hallmarks
of organized criminal activity. ORC typically refers to large-scale retail theft and fraud by
organized groups of professional shoplifters, or “boosters.” 81 ORC involves a host of retail crimes
ranging from retail, manufacturing, distribution, and cargo theft to gift card fraud, receipt fraud,
and ticket switching. 82 The organized crime rings resell illegally acquired merchandise in a
variety of fencing operations such as flea markets, swap meets, pawn shops, and, more recently,
online marketplaces. Most stolen merchandise is sold to a low-level fence, commonly called a
“street fence.” Street fences will either sell these goods directly to the public or will sell the
merchandise to mid-level fences who run “cleaning operations” that remove security tags and
store labels as well as repackage stolen goods so they appear as though they came directly from
the manufacturer. This “cleaning” may even involve changing the expiration date on perishable
goods such as over-the-counter medication and infant formula.
Globalization and technological innovation have allowed more and more transactions to take
place online rather than face-to-face. This holds true for retail crime, where thieves have turned to
“e-fencing”—using the Internet and online marketplaces as means to fence ill-gotten goods. 83
This has increased criminals’ anonymity, global reach, and profitability. Online markets allow
criminals to easily distribute stolen goods across the nation and around the globe. E-fencing has
also proven to be more profitable to criminals than has fencing at physical locations. While
criminals may profit about 30 cents on the dollar (30% of the retail price) by selling goods at
physical fencing locations, they can make about 70 cents on the dollar via e-fencing. 84
A criminal network based in Baltimore serves as an example of an operation that integrated
traditional as well as more technologically advanced fencing techniques. As of September 2010,
80 Department of Justice, “Leader of Hacking Ring Sentenced for Massive Identity Thefts from Payment Processor and
U.S. Retail Networks,” press release, March 26, 2010, http://www.justice.gov/opa/pr/2010/March/10-crm-329.html.
81 A “booster” is someone who steals merchandise and then sells it to a fence for a profit. A “fence” is someone who
knowingly buys illegally obtained goods from a booster and then sells the goods for a profit. For more information on
ORC, see CRS Report R41118, Organized Retail Crime, by Kristin M. Finklea.
82 Ticket switching involves means by which criminals alter the UPC bar codes on merchandise so that the items ring
up differently–significantly below the original price–at check-out.
83 King Rogers, “Organized Retail Theft,” in Retail Crime, Security, and Loss Prevention: An Encyclopedic Reference,
ed. Charles A. Sennewald and John H. Christman (Elseiver Inc., 2008).
84 National Retail Federation, 2009 Organized Retail Crime Survey, 2009, p. 8.
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at least 10 defendants, including the owners of pawn shops implicated in the scheme, had pleaded
guilty to roles in this organized retail crime ring. 85 In this conspiracy, boosters stole products,
including over-the-counter medications, health and beauty aids, gift cards, DVDs, and tools, from
retailers such as Target, Safeway, Wal-Mart, and Kohl’s. Several pawn shops bought these stolen
goods from boosters, cleaned them, and then transported them to other locations for resale. Some
co-conspirators used online marketplaces such as eBay and Amazon.com to fence the stolen
goods. In all, the case involved about $20 million in stolen goods.
Bulk Narcotics Smuggling and Technology
Technological advances have transformed cocaine and other narcotics trafficking. In the early
1990s, Colombian traffickers—moving narcotics to the United States and elsewhere around the
globe—began experimenting with semisubmersible maritime smuggling vessels, which at first
were likely too impractical, costly, and risky to operate. Hybrids of traditional submarines and
boats, these craft have small above-water profiles—about 18 inches. Increased law enforcement
seizures of cocaine shipments carried by more traditional surface vessels encouraged traffickers
to adopt semisubmersible technology. 86 Colombian traffickers likely co-opted experts from the
legitimate world to develop this technology. Most often, semisubmersibles are used to move
product from coastal areas to boats waiting on the open seas. While their current use likely
responds in part to interdiction pressures, it also reflects the global availability of expertise,
designs, and materials. Vast illicit global cocaine markets have also made such endeavors
possible, producing huge profits for traffickers that are then tilled into technology to circumvent
law enforcement. But semisubmersibles, which account for 27% of the maritime movement of
cocaine toward the United States, themselves are not immune to capture. 87 Since 2006, law
enforcement has regularly seized semisubmersible cocaine smuggling vessels from Colombian
drug traffickers on the high seas or in clandestine shipyards hidden in coastal mangrove swamps.
The Drug Trafficking Vessel Interdiction Act of 2008 (P.L. 110-407) enhanced the federal
government’s ability to prosecute traffickers operating submersible and semisubmersible vessels
by making it a federal crime to operate, embark on, or conspire to operate these vessels in
international waters with the intent to avoid detection.
In early July 2010, police in Ecuador seized a fiberglass submarine designed to operate fully
submerged at a depth of 65 feet. The diesel-powered, twin-screw sub, a marked step forward in
technology, was likely intended to transport cocaine on the high seas and could carry 10 tons of
cocaine on a 10-day voyage. This vessel represented a large improvement over the
semisubmersibles that have been regularly seized from traffickers since 2006. 88
85 Department of Justice, “Pawn Shop Owner Pleads Guilty in Scheme to Launder $20 Million in Proceeds of Stolen
Merchandise: Admitted Laundering Millions of Dollars in Proceeds of Stolen Over-the-Counter Medicines, Health and
Beauty Aid Products, Gift Cards, DVDs, Tools, and Other Items,” press release, September 3, 2010,
http://baltimore.fbi.gov/dojpressrel/pressrel10/ba090310a.htm.
86 Steven S. Dudley, Drug Trafficking Organizations in Central America: Transportistas, Mexican Cartels, and Maras,
Woodrow Wilson International Center For Scholars, Mexico Institute and University of San Diego Trans-Border
Institute, Working Paper Series on U.S.-Mexico Security Cooperation, Washington, DC, May 2010, p. 17,
http://wilsoncenter.org/topics/pubs/
Drug%20Trafficking%20Organizations%20in%20Central%20America.%20Dudley.pdf.
87 Rear Admiral Vincent Atkins, U.S. Coast Guard, Testimony before the House Subcommittee on Homeland Security,
on Department of Homeland Security Air and Marine Operations and Investments, April 19, 2010, http://www.dhs.gov/
ynews/testimony/testimony_1271690315007.shtm.
88 Jim Popkin, “Authorities in Awe of Drug Runners’ Jungle-Built, Kevlar-Coated Supersubs,” Wired Magazine, March
(continued...)
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Mexican drug traffickers have increasingly relied upon ultralight aircraft 89 to smuggle drugs
across the Southwest border into the United States. These small planes can fly as low as tree level
and are less easily detected than the larger aircrafts that were used by the traffickers prior to
2007. 90 While some traffickers may land the ultralights on the U.S. side of the border to pass off
drug loads to distributors, others attach drop baskets that can carry over 300 pounds of marijuana
or other drugs. These drop baskets release packages of drugs that will fall to the ground when a
lever in the aircraft is activated, and then local gangs or traffickers can pick up and distribute the
drugs. In May 2009, a low-flying ultralight aircraft carrying about 275 pounds of marijuana,
estimated to be worth $220,480, crashed in Yuma, AZ. The pilot escaped, but two suspected coconspirators
were arrested. 91
Cross-Border Tunnels
Mexican drug traffickers rely on the use of underground, cross-border tunnels to smuggle drugs
from Mexico into the United States. Tunneling, while not in and of itself a new tool—having been
used for hundreds of years during conflicts and for escapes—has increased not only in prevalence
but in sophistication. 92 Early tunnels were rudimentary, “gopher hole” tunnels dug on the
Mexican side of the border, traveling just below the surface, and popping out on the U.S. side as
close as 100 feet from the border. Slightly more advanced tunnels began to rely on existing
infrastructure, which may be shared by neighboring border cities such as the tunnel shared by
Nogales, AZ, in the United States and Nogales, Sonora, in Mexico. These interconnecting tunnels
may tap into storm drains or sewage systems in order to move drugs even further than smugglers
could move them by digging tunnels alone. The most sophisticated tunnels can have rail,
ventilation, and electrical systems. In January 2006 in Otay Mesa, CA, a tunnel, stretching nearly
three-quarters of a mile in length and traveling over 85 feet below the surface of the earth, was
discovered, where more than two tons of marijuana was seized. 93 The tunnel had lighting,
ventilation, and groundwater drainage systems. In November 2010, the San Diego Tunnel Task
Force—created in 2003 as a partnership between the U.S. Immigration and Customs Enforcement
(...continued)
29, 2011, http://www.wired.com/magazine/2011/03/ff_drugsub/all/1; “DEA Intel Aids in Seizure of Fully-Operational
Narco Submarine in Ecuador,” press release, July 3, 2010; Chirs Kraul, “Ecuador Police Seize 100-foot Narco-
Submarine Being Built Secretly,” Los Angeles Times, July 6, 2010, http://www.latimes.com/news/nationworld/world/
la-fg-ecuador-narco-sub-20100706,0,162212.story; Douglas A. Kash and Eli White, “A New Law Counters the
Semisubmersible Smuggling Threat,” Federal Bureau of Investigation, March 2010, http://www.fbi.gov/publications/
leb/2010/march2010/smuggling_feature.htm; U.S. Southern Command, “The Self-Propelled Semi-Submersibles
Threat,” February 20, 2009, http://www.southcom.mil/appssc/factFiles.php?id=83.
89 The Federal Aviation Administration (FAA) does not classify ultralights as “aircraft.” For the FAA definition of an
ultralight, see the Code of Federal Regulations (CFR) Title 14, Section 103, http://ecfr.gpoaccess.gov/cgi/t/text/textidx?c=ecfr&sid=77f64066b8e425c01339f918e6e9f291&rgn=div5&view=text&node=14:2.0.1.3.16&idno=14.
Legislation has been introduced in the 111 th Congress (H.R. 5307) that would include ultralights in the definition of an
aircraft in order to increase law enforcement’s abilities to prosecute drug smuggling cases.
90 Agence France-Presse, “Mexican Drug Traffickers Using Tiny Planes for US Market,” MSN News, September 2,
2010, http://news.ph.msn.com/business/article.aspx?cp-documentid=4311772.
91 U.S. Customs and Border Protection, “Ultralight Plane Crashes in Arizona, Smugglers Apprehended,” press release,
May 30, 2009, http://www.cbp.gov/xp/cgov/newsroom/news_releases/archives/2009_news_releases/may_2009/
05302009.xml.
92 Ken Stier, “Underground Threat: Tunnels Pose Trouble from Mexico to Middle East,” Time, May 2, 2009.
93 U.S. Drug Enforcement Administration, “DEA/ICE Uncover ‘Massive’ Cross-Border Drug Tunnel, Cement lined
passage thought to link warehouses in Tijuana and Otay Mesa,” press release, January 26, 2006,
http://www.justice.gov/dea/pubs/pressrel/pr012606.html.
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(ICE), DEA, and the U.S. Border Patrol working along with state law enforcement and Mexican
counterparts—uncovered a 600-yard passageway stretching from Tijuana to Otay Mesa. About 30
tons of marijuana, with an estimated street value of about $20 million, were seized in the United
States and Mexico. 94 About a year later, the task force unearthed two other tunnels in Otay Mesa
within a two-week period. One of them stretched 612 yards and had electric rail cars, lighting,
reinforced walls, and wooden floors. 95
U.S. law enforcement uses various tactics and simultaneously faces numerous challenges in
detecting these cross-border tunnels. About 125 tunnels have been discovered since the 1990s—
primarily in Arizona and California—and more than 75 of these have been found since 2006. 96
One such method of tunnel detection is the use of ground penetrating radar (GPR). 97 However,
this technology is limited by factors including soil conditions, tunnel diameter, and tunnel depth.
Law enforcement may also use sonic equipment to detect the sounds of digging and tunnel
construction and seismic technologies to detect blasts that may be linked to tunnel excavation.
U.S. officials have acknowledged that law enforcement currently does not have technology that is
reliably able to detect sophisticated tunnels. 98 Rather, tunnels are more effectively discovered as a
result of human intelligence and tips rather than technology.
Exploitation of Ethnic Diaspora Communities
Criminal organizations structured along ethnic lines sometimes base their operations in immigrant
communities. 99 They use these enclaves to provide cover for their dealings and occasionally also
exploit their ethnic compatriots. Historically, criminal groups have burrowed into local ethnic
communities, but now this is enhanced by the fact that they can leverage Internet connectivity and
extensive, international transportation linkages from localities around the globe. A number of
recent cases highlight these issues.
In October 2010, a total of 73 individuals were indicted in the largest single Medicare fraud ever
charged. 100 As described by DOJ, the Mirzoyan-Terdjanian organization, an Armenian criminal
group, ran fake clinics in 25 states, but had its leadership based in Los Angeles and New York
City, 101 two areas with large immigrant populations from the former Soviet Union, (e.g.,
94 U.S. Drug Enforcement Administration, “Tunnel Task Force Discovers Cross Border Tunnel, 30 tons of Marijuana
Seized in Investigation,” press release, November 3, 2010, http://www.justice.gov/dea/pubs/states/newsrel/2010/
sd110310.html.
95 Immigration and Customs Enforcement, “Highly Sophisticated Cross-Border Drug Tunnel Discovered Near San
Diego,” press release, November 15, 2011, http://www.ice.gov/news/releases/1111/111130sandiego.htm.
96 Michael Thurston, “Record drugs haul seized from US-Mexico border tunnel,” AFP, November 4, 2010,
http://www.google.com/hostednews/afp/article/ALeqM5jQ20K1Iy7AaXLBGtqiAxnfkCMTGQ?docId=
CNG.a14f67109bad6c916ff3ce51f338a2d8.3b1.
97 For more information, see http://www.geophysical.com/militarysecurity.htm.
98 Ken Stier, “Underground Threat: Tunnels Pose Trouble from Mexico to Middle East,” Time, May 2, 2009.
99 Klaus von Lampe, “Re-Conceptualizing Transnational Organized Crime: Offenders as Problem Solvers,”
International Journal of Security and Terrorism, vol. 2, no. 1 (2011), p. 9. (Hereafter: von Lampe, “Re-
Conceptualizing.” )
100 Department of Justice, “Manhattan U.S. Attorney Charges 44 members and Associates of an Armenian-American
Organized Crime Enterprise with $100 Million Medicare Fraud,” press release, October 13, 2010,
http://newyork.fbi.gov/dojpressrel/pressrel10/nyfo101310.htm. (Hereafter, DOJ press release, “Manhattan U.S.
Attorney”; DOJ press release, “Seventy-Three Members.”)
101 DOJ press release, “Seventy-Three Members.”
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Organized Crime: An Evolving Challenge for U.S. Law Enforcement
Glendale, in the Los Angeles region, is home to 200,000 Armenian Americans). According to the
president of the Los Angeles chapter of the Armenian-American Chamber of Commerce, this
community is exploited by a handful of criminals who were “raised under communist rule in the
former Soviet republic of Armenia, where exploiting a corrupt government was seen as fair
game.” 102
Members of the Mirzoyan-Terdjanian group
allegedly billed Medicare for more than $163
million in fraudulent medical services. They
reaped about $35 million in profits. 103 The case
involves the stolen identities of both doctors and
Medicare beneficiaries and the creation of at least
118 spurious medical clinics across at least 25
states, all part of a largely “virtual” operation.
FBI Assistant Director in Charge Janice K.
Fedarcyk described the organization as
completely notional. There were no real
medical clinics behind the fraudulent billings,
just stolen doctors’ identities. There were no
colluding patients signing in at the clinics for
unneeded treatments, just stolen patient
identities. The whole doctor-patient interaction
was a mirage. But the money was real, while it
lasted. 104
The indictment in the case also linked Armen
Kazarian to the scheme. Arrested in Los Angeles,
Kazarian, an Armenian residing in the United
States, had substantial influence in the criminal
underworld as a vor v zakone, a Russian term
meaning “thief-in-law.” 105 Kazarian had
reputedly lied to federal authorities to obtain
asylum after emigrating to the United States in
Organized Crime and
Health Care Fraud
Acting Deputy Attorney General Gary G. Grinder
has stated that “the emergence of international
organized crime in domestic health care fraud
schemes signals a dangerous expansion that poses a
serious threat to consumers” 1 The health care
system as well as both public and private assistance
programs have been targets of individual scammers
and organized criminals alike. Criminals steal the
identities—or create fake identities—of medical
providers, clinics and businesses, and patients.
According to the most recent data, in FY2009 U.S.
Attorneys opened 1,014 health care fraud
investigations, encompassing 1,786 defendants. 1 Aside
from the Mirzoyan-Terdjanian organization indicted
by DOJ, other criminal networks—Eurasian and
Nigerian groups—involved in large-scale health care
fraud in Los Angeles have recently been caught by
U.S. law enforcement. According to news reports,
organized crime has turned to targeting Medicare and
Medicaid for profit. 1 It is very likely that the groups in
Los Angeles favored stealing doctor and patient
identities for fraudulent billing over more violent and
less lucrative criminal activity. One expert has
suggested, “[Health care fraud is] lucrative and it’s
safe for them [organized criminals]. Why rob a bank
and risk getting shot when you can click a mouse and
bill Medicare or Medicaid, basically lie on some forms
and make millions of dollars doing so.” 1
1996. 106 In the course of the scheme, Kazarian mediated disputes for the Mirzoyan-Terdjanian
group and allegedly threatened to assault and kill an associate. In July 2011, Kazarian pled guilty
102 Thomas Watkins, “Armenian Organized Crime Grows More Complex,” Associated Press, October 16, 2010,
http://news.yahoo.com/s/ap/20101016/ap_on_re_us/us_armenian_crime_2.
103 In December 2011, one of the group’s leaders, Robert Terdjanian, pled guilty to charges related to the case. See
Bruce Golding, “Swan Song for Gangster,” New York Post, December 20, 2011, http://www.nypost.com/p/news/local/
manhattan/swan_song_for_gangster_T3KqaxeuQkAVNhHjioXmaJ.
104 DOJ press release, “Manhattan U.S. Attorney.”
105 The indictment describes a thief-in-law as “a member of a select group of high-level criminal figures from Russia
and the Former Soviet Union who receives tribute from other criminals, offers protection, and uses his recognized
position of authority to resolve disputes among criminals, including through threats and instances of violence.” See
United States vs. Armen Kazarian, Davit Mirzoyan, Robert Terdjanian, et al., Indictment in the U.S. District Court for
the Southern District of New York, filed October 13, 2010, http://www.scribd.com/full/39274052?access_key=key-
7m8lpi9tq05hn86c111. (Hereafter, United States vs. Armen Kazarian.)
106 Michael Wilson, William K. Rashbaum, “Real Patients, Real Doctors, Fake Everything Else,” New York Times,
October 13, 2010, http://www.nytimes.com/2010/10/14/nyregion/14fraud.html?_r=1&scp=1&sq=
Real%20Patients,%20Real%20Doctors,%20Fake%20Everything%20Else&st=cse; United States vs. Armen Kazarian.
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Organized Crime: An Evolving Challenge for U.S. Law Enforcement
to racketeering in the case. 107 The indictment suggests that members of the organization, many of
them Armenian nationals or immigrants, sent criminal proceeds to Armenia, purchasing real
estate and operating businesses with the funds. 108
In June 2010, DOJ charged five Ukrainian brothers with extortion and conspiring to engage in a
pattern of racketeering activity. This far-flung operation based out of Philadelphia and Ukraine
had allegedly trafficked about 30 Ukrainians into the United States via Mexico, exploiting them
in cleaning crews operating in stores, private residences, and office buildings in Pennsylvania,
New York, New Jersey, Maryland, and Washington, DC. According to DOJ, the brothers failed to
pay their victims, threatened them with violence, physically abused them, and housed them in
overcrowded quarters. One of the brothers is accused of raping a trafficked woman on several
occasions. 109 The victims of this scheme likely trusted the brothers as immigrants who had ties to
the United States and were willing to help others start new lives in the country.
In another case, at least five Chinese citizens involved in operating Asian massage parlors in
Kansas were sentenced between April and October of 2009 for their roles in exploiting Chinese
women in the United States. 110 The defendants recruited women from China to work in the United
States as masseuses. They then confiscated the women’s identification documents and used these
documents to fraudulently wire proceeds from illegal activities back to China. They forced the
women to work for 14 hours every day, locked them inside the massage parlors to sleep at night,
and forced them to perform sexual services for the male patrons of the massage parlors.
West African criminal networks specializing in AFF operate in many nations including the United
States, where members have assimilated into local ethnic communities. Many West African
fraudsters based outside of their home countries direct proceeds back to organizations in their
homelands. More recently, it appears that some of these diaspora-based criminals are operating
independently and retaining their ill-gotten gains. 111
107 Department of Justice, “Leader of Armenian Organized Crime Ring Pleads Guilty in Manhattan Federal Court to
Racketeering,” press release, July 8, 2011, http://www.justice.gov/usao/nys/pressreleases/July11/
kazarianarmenpleapr.pdf.
108 United States vs. Armen Kazarian.
109 Department of Justice, “Five Brothers Charged in Human Trafficking Scheme that Smuggled Young Ukrainian
Migrants,” press release, June 30, 2010, http://www.justice.gov/opa/pr/2010/June/10-crt-765.html; Nathan Gorenstein,
“5 Brothers Charged with Human Trafficking,” Philadelphia Inquirer, June 30, 2010, http://www.philly.com/philly/
news/breaking/97508149.html?cmpid=15585797; United States v. Omelyan Botsvynyuk, et al, Indictment in the U.S.
District Court for the Eastern District of Pennsylvania, n.d. http://www.justice.gov/usao/pae/News/Pr/2010/Jun/
botsvynyuk_indictment.pdf. In October 2011, two of the brothers, Omelyan and Stepan Botsvynyuk, were convicted
“of conspiracy to violate the Racketeer Influenced and Corrupt Organizations (RICO) Act in connection with a human
trafficking scheme.” At the time of the duo’s trial, two other brothers were in Canada awaiting extradition and the
remaining sibling was a fugitive. See Department of Justice, “Brothers Convicted in Human Trafficking Scheme,”
press release, October 12, 2011, http://www.fbi.gov/philadelphia/press-releases/2011/brothers-convicted-in-humantrafficking-scheme;
Michael Matza, “Trial Set to Begin for Botsvynyuk Brothers in Human-Trafficking Case,”
Philadelphia Inquirer, September 13, 2011, http://articles.philly.com/2011-09-13/news/30149728_1_t-visa-programhuman-trafficking-immigrant-rights-groups.
110 Federal Bureau of Investigation, “Leader of Asian Massage Parlor Scheme Sentenced for Coercing Prostitution,
Money Laundering, Identity Theft,” press release, October 14, 2009, http://kansascity.fbi.gov/dojpressrel/pressrel09/
kc101409.htm.
111 IMMFWG, Mass Marketing Fraud, p. 15.
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Organized Crime: An Evolving Challenge for U.S. Law Enforcement
Changing Structures
The traditional image of organized crime involves elaborate hierarchies, behavioral codes, and
initiation rituals. Some criminal organizations like the Cosa Nostra retain a strong element of
hierarchy. However, in the last 20 years the criminal underworld has likely moved away from
rigid hierarchical organizational structures and toward decentralized and more flexible “network”
models. One scholar has argued that the public is still wedded to hierarchical archetypes
particularly when conceptualizing how smugglers operate:
Still infused with images of cartels and syndicates—rigid, top-down organizations—we are
not accustomed to thinking of flexible, even unchartable networks of intermediaries that
operate across many borders and provide different services. Some are permanently linked
and others vary in their composition, activities, and geographical scope depending on
markets and circumstances. Thus, brokers and agents with access to multiple suppliers,
conveyors, and buyers are more significant in the drug trade than are old-fashioned
“kingpins.” For all these brokers, expanding into new product lines, legal or illegal is just a
logical business step. 112
As discussed elsewhere, criminals (much like legitimate businesses) have internationalized their
operations, particularly in the last two decades. The fast movement of people, goods, and
information stimulated by globalization and technological change has encouraged
decentralization and outsourcing. Networks are especially suited for this type of environment. 113
Global businesses and criminal organizations now give critical roles to individuals or groups
outside of an organization’s core that are often physically separated by thousands of miles. In
some cases, such as Colombian drug trafficking organizations, law enforcement successes against
criminal hierarchies may have encouraged the adaptation of networks. 114 Criminals conduct more
business offshore because of the efficiencies offered by the Internet and advances in the world’s
transportation and communication infrastructures. 115 In the underground economy, these changes
have encouraged the abandonment of exclusivity implied by the elaborate codes of behavior,
ethnic bonds, and rigid hierarchy that once typified organized crime. 116
Networked structures shield organized criminals from law enforcement efforts. 117 Beyond its
immediate duties, one element or node in a network can have little understanding of the entire
network’s criminal activity. It is possible for a network to operate without a single constituent part
knowing the entire scheme. In larger networks with clear cut leaders, layers of peripheral nodes
112 Naím, Illicit, pp. 219-220. For a similar discussion that also cites Naím, see Juan Carlos Garzón, Mafia & Co. The
Criminal Networks in Mexico, Brazil, and Colombia, (Washington, DC: Woodrow Wilson International Center for
Scholars, Latin American Program, English translation of 2008 Spanish ed., 2010) pp. 33-34. (Hereafter, Garzón,
Mafia & Co.)
113 Phil Williams, “Transnational Criminal Networks,” in Networks and Netwars, ed. John Arquilla, David Ronfeldt
(Santa Monica, CA: National Defenses Research Institute, RAND, 2002), pp. 77-78. (Hereafter: Williams,
“Transnational Criminal Networks.”)
114 Scott H. Decker and Margaret Townsend Chapman, Drug Smugglers on Drug Smuggling: Lessons from the Inside
(Philadelphia: Temple University Press, 2008), pp. 34-36.
115 Stephen Aguilar-Millan et al., “The Globalization of Crime,” The Futurist, November/December 2008, p. 42.
116 Chatterjee, The Changing Structure. pp, 2, 7-8.
117 Carlo Morselli, Inside Criminal Networks (New York: Springer, 2009), p. 71.
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Organized Crime: An Evolving Challenge for U.S. Law Enforcement
likely do not know who directs them. Disruption of peripheral network elements by law
enforcement may alert core players to shut down the enterprise. 118
Network Models
Illicit networks broadly follow two models. “Hub and spoke” networks involve peripheral nodes
tied to a leadership core. Core players initiate schemes, settle conflicts, and provide guidance to
others. In this model, activity moves from core to peripheral players while the peripheral entities
do not interact with one another. “Chain” networks involve the flow of information or movement
of criminal goods from node to node in linear fashion without a discernable center of gravity or
central command. 119 They often lack obvious individual focal points for policing efforts.
Networks can quickly adapt to changing market conditions or the elimination of nodes by law
enforcement by quickly recruiting replacement specialists. Unlike hierarchies such as the Cosa
Nostra, networks have few membership requirements, initiation rituals, or loyalty tests. These
organizations can also shift allegiances easily, opportunistically drawing in participants for
specific tasks. 120
Blurring of Forms
Some powerful criminal groups that still favor traditional hierarchical structures featuring distinct
lines of authority simultaneously exhibit networked characteristics as well, especially a flattening
of leadership arrangements and outsourcing of some activities to criminals outside their
immediate command and control structures. For example, in the United States hierarchical
Mexican drug cartels rely on networks to handle aspects of trafficking. Violent U.S. gangs
transport wholesale quantities of narcotics into the United States and procure weapons for some
cartels. 121 Prison gangs, for instance, are highly structured, and both national- and regional-level
prison gangs have formed alliances with Mexican DTOs. For example, the Barrio Azteca prison
gang—operating primarily in southwestern Texas and southeastern New Mexico—has partnered
with the Juárez cartel and generates much of its money from smuggling marijuana, heroin, and
cocaine across the Southwest border. 122 Similarly, one author of a broad study of criminal
organizations in Mexico, Brazil, and Colombia has noted that these groups embody
118 Williams, “Transnational Criminal Networks,” pp. 64-75.
119 Mette Eilstrup-Sangiovanni and Calvert Jones, “Assessing the Dangers of Illicit Networks: Why al-Qaida May Be
Less Threatening Than Many Think,” International Security, Fall 2008, pp. 12-13.
120 For networked structures among Colombian drug traffickers, see Michael Kenney, “The Architecture of Drug
Trafficking,” in From Pablo to Osama: Trafficking and Terrorist Networks, Government Bureaucracies, and
Competitive Adaptation (University Park, PA: Pennsylvania State University Press, 2007), pp. 25-47. (Hereafter,
Kenney, From Pablo to Osama.)
121 National Gang Intelligence Center and National Drug Intelligence Center, National Gang Threat Assessment, 2009,
January 2009, pp. 11-12, http://www.fbi.gov/publications/ngta2009.pdf.
122 Ibid., p. 28. Barrio Azteca members are also involved in other crimes, such as extortion, kidnapping, and alien
smuggling. For more information, see Tom Diaz, “Barrio Azteca—Border Boys Linked to Mexican Drug Trafficking
Organizations—Part Three,” April 17, 2009, http://tomdiaz.wordpress.com/2009/04/17/barrioazteca%E2%80%93border-bad-boys-linked-to-mexican-drug-trafficking-organizations-%E2%80%94-part-three/.
See
also the Department of Justice website at http://www.usdoj.gov/criminal/gangunit/gangs/prison.html.
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Organized Crime: An Evolving Challenge for U.S. Law Enforcement
characteristics of what he dubs the “Godfather Model”—rigid hierarchy—and the “Facebook
Model”—dynamic network. 123
Advantage: Networks Challenge Law Enforcement
The shift to networked structures may suggest that criminals are more elusive than ever as the
illicit world evolves rapidly, while law enforcement “plays by yesterday’s rules and increasingly
risks dealing only with the weakest criminals and the easiest problems.” 124 According to one
study, when combating agile drug cartels, a number of impediments hobble law enforcement
officials. Most broadly, the hierarchical authority embodied in bureaucratic structures complicates
the decision-making process. 125 Additionally, law enforcement potentially faces
interagency coordination problems that further complicate, and decelerate, decision making,
comprehensive legal and bureaucratic constraints to action, and ambiguous incentive
structures that undermine some agents’ willingness to share information—and others’
commitment to winning the war on drugs. 126
Yet another challenge for law enforcement investigating more-networked organized criminal
groups may arise from constraints in extraterritorial jurisdiction. While some criminal actors in a
network may conduct business offshore or overseas and federal law enforcement does have
extraterritorial jurisdiction to investigate and prosecute individuals who criminally violate U.S.
interests abroad, this jurisdiction does not necessarily cover all crimes committed by organized
crime groups. 127 Further, jurisdictional issues can present substantial diplomatic and practical
challenges for law enforcement.
Disadvantage: Networks Have Exploitable Weaknesses
Some of the strengths suggested by network structure can also be interpreted as weaknesses.
Their inherent compartmentalization potentially impedes efficient information sharing, as key
players keep peripheral actors in the dark about important aspects of complex schemes. This
suggests that highly networked organizations more effectively engage in simpler criminal
conspiracies. Decentralization can undermine the development of strategy and slow down
decision making. It may also encourage excessive risk taking by peripheral actors who are not
controlled by hierarchical roles rooted in rules enforced by the organization. Decentralization
possibly also nurtures challengers who compete with core leaders and foster organizational
instability. 128 Maintaining networks also likely requires “time-consuming” effort geared toward
“building and fostering relationships.” 129
123 Garzón, Mafia & Co. pp. 23-24.
124 Intelligence Committee Futures Working Group, Futures, p. 2.
125 Kenney, From Pablo to Osama, p. 132-133.
126 Ibid.
127 See the Omnibus Diplomatic Security and Antiterrorism Act of 1968, Title XII of P.L. 99-399. For more detailed
information regarding the United States extraterritorial jurisdiction as well as the specific crimes included in this
jurisdiction, see CRS Report 94-166, Extraterritorial Application of American Criminal Law, by Charles Doyle.
128 Mette Eilstrup-Sangiovanni and Calvert Jones, “Assessing the Dangers of Illicit Networks: Why al-Qaida May Be
Less Threatening Than Many Think,” International Security, Fall 2008, pp. 16-33.
129 von Lampe, “Re-Conceptualizing,” p. 9.
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Organized Crime: An Evolving Challenge for U.S. Law Enforcement
Corruption
Some criminal networks co-opt or attract participants from the licit realm, using their specialized
skills to provide “logistical advantages.” 130 These skills are especially valuable in a globalized,
high tech era in which technology is critical in overcoming geographical barriers that once slowed
international trade. Corrupt individuals maintain their status in above-board business or
governmental jobs, providing criminals with clean assets, closely guarded information,
specialized access, sensitive information, or resources. Corrupt licit-realm actors also potentially
lend criminal enterprises a sense of legitimacy. 131 Because of globalization, it is likely harder to
disprove a criminal’s claims that he is a legitimate businessman, especially if the proof lies
overseas or in multiple jurisdictions. The efforts of organized criminals to draw into their
organizations legitimate persons can be described from three broad perspectives: grass-roots,
private sector criminal infiltration of businesses; co-optation of powerful business leaders; and
public corruption.
“Ground-Level” Exploitation of Private Businesses
Non-executive employees or self-employed individuals can provide criminal organizations with
highly specialized capabilities in our highly networked age. The possibilities for co-opted private
sector specialists are plentiful. The three examples below suggest this.
• Viktar Krus operated a network that illegally brought foreign workers into the
United States. He relied on legitimate facilitators such as Beth Ann Broyles, an
Illinois immigration attorney who prepared fraudulent immigration petitions for
the organization. Broyles claimed that she initially did not know that she was
involved in criminal activity. When she eventually discerned that she was,
Broyles rationalized her participation by believing that she was actually
somehow assisting immigrants. She was among two dozen co-defendants who
worked in Krus’s network. Additionally, Krus likely relied on bribing hotel
employees to inflate the number of workers they needed to hire. Between 2003
and 2008, he used at least 10 shell companies and evaded millions of dollars in
taxes while bringing in 3,800 immigrants, many illegally, to work in the service
sector and industrial jobs in the Norfolk, VA, region and elsewhere around the
United States. He grossed $34 million, forced people to live 12-15 to an
apartment, garnered fees from their wages, and charged legitimate businesses $10
per hour for their labor. Krus received a seven-year prison sentence for
conspiracy, tax fraud, visa fraud, and money laundering. 132
130 Ibid.
131 CISC, 2010 Report, p. 15, http://www.cisc.gc.ca/annual_reports/annual_report_2010/document/
report_oc_2010_e.pdf. See also Carlo Morselli and Cynthia Giguere, “Legitimate Strengths in Criminal Networks,”
Crime, Law, and Social Change, 2006, pp. 185-200.
132 Tim McGlone, “Lawyer Sentenced for Part in Immigration Fraud Ring,” The Virginian-Pilot, January 26, 2010;
McGlone, “Belarus Man Gets 7 Years for Illegal Workers,” The Virginian-Pilot, July 18, 2009,
http://hamptonroads.com/2009/07/belarus-man-gets-7-years-illegal-workers; McGlone, “Prosecutors Tie Illegal
Workers to International Crime Syndicate,” The Virginian-Pilot, January 17, 2009; McGlone, “Illegal-Immigrant
Network Supplied Region and Beyond,” The Virginian-Pilot, January 14, 2009; Bureau of Immigration and Customs
Enforcement, “22 Charged with Massive International Visa Scheme,” press release, January 13, 2009. For similar
examples involving Eurasian organized criminals, see Alexander Sukharenko, “The Use of Corruption by ‘Russian’
Organized Crime in the United States,” Trends in Organized Crime, vol. 8, no. 2 (Winter 2004).
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Organized Crime: An Evolving Challenge for U.S. Law Enforcement
• According to DOJ, the Tran organization, a criminal group that cheated
approximately 27 casinos in the United States and Canada out of more than $7
million, bribed card dealers and supervisors at casinos to advance its scheme. In
what has been dubbed “the largest cheating ring of all time,” 133 corrupt dealers
rigged their shuffles during mini-baccarat and blackjack games. The group also
used technologically advanced tools such as hidden transmitters and custom
software to predict the order in which cards would reappear during games. 134 The
organization began its operations in 2002, and the initial indictment was returned
against the group in May 2007. 135
• DOJ’s Organized Crime and Racketeering Section helped prosecute Victor
Kaganov in connection with an illegal money transmitting business he allegedly
ran in Oregon. In March 2011, Kaganov pled guilty to operating an illegal money
transmitting business. 136 DOJ has not publicly linked Kaganov, who was indicted
in March 2010, to any organized crime figures. However, Kaganov purportedly
opened multiple shell corporations in Oregon on behalf of Russian clients. He
used the shells to shuttle more than $172 million via more than 4,200 wire
transactions “in and out of the United States to more than 50 countries,”
according to DOJ. 137 His supposed criminal activity highlights services that
organized criminals could potentially use to launder money.
Big Business and Organized Criminals
In his Annual Threat Assessment for 2010, then-Director of National Intelligence Dennis Blair
noted that government, organized crime, intelligence services, and big business figures are
growing increasingly close in their interactions. He stated,
an increasing risk from Russian organized crime is that criminals and criminally linked
oligarchs [powerful Eurasian businessmen who rose to power in the immediate post-Soviet
period] will enhance the ability of state or state-allied actors to undermine competition in
gas, oil, aluminum, and precious metals markets. 138
However, based on open source information, it is often difficult to determine with any degree of
certainty whether oligarchs or other powerful international entrepreneurs with interests in U.S.
markets or investors have criminal connections.
133 Liz Benston, “As Baccarat Grows in Popularity, So Does Cheating,” Las Vegas Sun, August 30, 2010,
http://www.lasvegassun.com/news/2010/aug/30/baccarat-grows-popularity-so-does-cheating/.
134 Department of Justice, “Former Mohegan Sun Card Dealer Sentenced to Prison for Involvement in Cheating
Conspiracy,” press release, April 7, 2010, http://newhaven.fbi.gov/dojpressrel/pressrel10/nh040710.htm; Department of
Justice, “Leader of Casino-Cheating Criminal Enterprise Sentenced to 70 Months in Prison for Targeting Casinos
Across the United States,” press release, March 15, 2010, http://www.justice.gov/opa/pr/2010/March/10-crm-265.html.
135 Department of Justice, “Eight More Individuals Charged in Casino-Cheating Conspiracy,” press release, September
18, 2009, http://www.justice.gov/opa/pr/2009/September/09-crm-999.html.
136 Department of Justice, “Tigard Man Pleads Guilty to Operating Illegal Money Transmitting Business,” press
release, March 1, 2011, http://www.justice.gov/usao/or/PressReleases/2011/20110301_Kaganov.html.
137 Department of Justice, “Tigard Man Indicted in Connection with Illegal Money Transmitting Business Shell
Corporations Created by Defendant to Move Millions of Dollars in and out of United States,” press release, March 3,
2010, http://portland.fbi.gov/dojpressrel/pressrel10/pd030310.htm.
138 Blair, “Annual Threat Assessment,” p. 44.
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Organized Crime: An Evolving Challenge for U.S. Law Enforcement
Russian billionaire Oleg Deripaska exemplifies this difficulty. According to unnamed U.S. federal
officials cited in news reports, Deripaska has struggled to maintain a U.S. visa because of his
alleged ties to organized crime. 139 Prior to the global financial crisis, he possessed a $28 billion
fortune and was the ninth-wealthiest person in the world. 140 He obtained a U.S. visa in 2005, but
it was revoked soon thereafter. 141 According to press reporting, in 2009 the FBI set up two U.S.
visits by Deripaska for undisclosed reasons on a limited entry permit from the Department of
Homeland Security (DHS). 142 Claims of criminal connections have publicly dogged him for years.
But Deripaska has never been convicted of a crime and has strongly denied all accusations. 143 His
difficulty getting a U.S. visa may have kept some U.S. bankers from participation in an initial
public offering (IPO) involving his aluminum company, UC Rusal. 144 The IPO occurred in
January 2010 on the Hong Kong stock exchange. 145
Like Deripaska, Stanley Ho, a billionaire casino magnate from Macau, has routinely denied
accusations of ties to organized crime. According to media reports, U.S. officials have long
suspected Ho had links to Chinese criminal groups known as triads. 146 These suspicions recently
resurfaced and involved his daughter, Pansy, and a casino venture in Macau. Pansy and Nevadabased
MGM Resorts International (MGM) 147 jointly operate the MGM Macau, which opened in
December 2007. 148
Pansy Ho’s co-ownership of MGM Macau emerged as an issue for New Jersey gaming regulators
because MGM also possessed a 50% share in Atlantic City’s Borgata Hotel Casino and Spa.
According to New Jersey law, MGM had to prove “by clear and convincing evidence, its ‘good
character, honesty and integrity’ on a continuing basis” to maintain its 50% share in the
Borgata. 149 In essence, the company and its partners had to be found suitable to operate in New
Jersey.
139 Gregory L. White and Diana Cimilluca, “Some Bankers Cool on Hot Rusal IPO,” Wall Street Journal, November 9,
2009, http://online.wsj.com/article/NA_WSJ_PUB:SB125755269536534861.html. (Hereafter, White and Cimilluca,
“Some Bankers.”) Evan Perez, Gregory L. White, “FBI Lets Barred Tycoon Visit U.S.,” October 30, 2009,
http://online.wsj.com/article/NA_WSJ_PUB:SB125685578903317087.html. (Hereafter, Perez and White, “FBI Lets
Barred Tycoon.”)
140 “The World’s Billionaires: #9 Oleg Deripaska,” Forbes.com, March 5, 2008, http://www.forbes.com/lists/2008/10/
billionaires08_Oleg-Deripaska_UCP9.html.
141 Perez and White, “FBI Lets Barred Tycoon.”
142 White and Cimilluca, “Some Bankers”; Perez and White, “FBI Lets Barred Tycoon.”
143 John Helmer, “Deripaska in ‘Russian Mafia’ Probe,” BusinessDay, May 14, 2010, http://www.businessday.co.za/
articles/Content.aspx?id=108965; Misha Glenny, Robert Booth, and Tom Parfitt, “US Refused Oligarch Visa Over
Alleged Criminal Associations,” The Guardian, October 31, 2008, http://www.guardian.co.uk/world/2008/oct/31/olegderipaska-us-visa-rusal.
144 White and Cimilluca, “Some Bankers.”
145 “Aluminum giant RusAl raises $2.24 bln with Hong Kong IPO,” RIA Novosti, January 22, 2010, http://en.rian.ru/
business/20100122/157651607.html.
146 Neil Gough, “Triads Thrive in Ho’s Casinos, US Report Says,” South China Morning Post, March 19, 2010.
Alexandra Berzon and A.D. Pruitt, “MGM Mirage Knew Ally Was Unfit,” Wall Street Journal, March 17, 2010,
http://online.wsj.com/article/SB10001424052748704743404575127673757750744.html.
147 Formerly MGM Mirage.
148 Tom Mitchell, “Spotlight on MGM Mirage’s ‘Wild Card,” Financial Times, March 19, 2010.
149 State of New Jersey Department of Law and Public Safety, Special Report of the Division of Gaming Enforcement
to the Casino Control Commission on Its Investigation of MGM Mirage’s Joint Venture with Pansy Ho in Macau,
Special Administrative Region, People’s Republic of China, Redacted, May 18, 2009, p. 1, http://www.state.nj.us/
casinos/home/info/docs/MGM/dge_%20report_redacted.pdf. (Hereafter, DGE, “Report.”)
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It appears that MGM’s direct ties to the Ho family were troubling to New Jersey regulators. In
May 2009, the New Jersey Division of Gaming Enforcement (DGE) published a report based on
its own investigation of MGM’s partnership with Pansy Ho in Macau. The DGE report
recommended that both Pansy and Stanley Ho be found “unsuitable persons” by the New Jersey
Casino Control Commission. 150 The DGE noted the elder Ho’s “continued business ties to persons
associated with organized crime” and his daughter’s “direct, substantial, and continuing business
and financial ties to her father.” 151 In March 2010, MGM decided to sell its interest in the Borgata
rather than sever ties with Pansy Ho. 152
Corruption of Public Officials
Organized criminals corrupt public employees, especially individuals who have sensitive jobs. In
many cases, criminals seek people who have skills, particular access to information, or job
responsibilities that lend themselves to specific schemes. For example, some criminals whose
operations depend on personal identification documents seek to inveigle employees with unique
access to such information, and smugglers lure people charged with protecting borders into their
operations.
In August 2010, Vitaly Fedorchuk was sentenced to 46 months in prison for leading a criminal
organization in the Cleveland, OH, area that fraudulently procured Ohio driver’s licenses and
identification cards for foreign nationals. To do so, Fedorchuk’s group relied on Sonya Hilaszek, a
corrupt employee at the Deputy Registrar’s Office in Parma, OH. She also pleaded guilty in the
case and received a prison sentence of 33 months. DOJ accused Hilaszek of producing documents
for between 300 and 500 individuals. The criminal group charged foreign nationals—many were
from Ukraine or Uzbekistan and in the United States illegally—between $1,500 and $3,000 for
the documents. Fedorchuk’s group also allegedly cooperated with criminals in Ukraine to
fraudulently obtain non-immigrant visas from the U.S. Embassy in Kyiv. They purportedly relied
on corrupt Ukrainian nationals employed by the Embassy and charged $12,000 per visa. 153
Mexican drug traffickers corrupt employees of federal agencies charged with protecting the
Southwest border. The number of cases involving corruption at Customs and Border Protection
(CBP) reported by the DHS Office of Inspector General have risen from 245 in FY2006 to more
than 770 (projected) for FY2010. 154 In FY2009 alone, the DHS Inspector General opened 839
investigations of potential corruption regarding DHS employees. Of the 839 investigations, 576
worked for CBP, 164 for ICE, 64 for U.S. Citizen and Immigration Services (CIS), and 35 for the
Transportation Security Administration (TSA). 155 While none of these figures establish exactly
150 DGE, “Report,” pp. 70-71.
151 DGE, “Report,” p. 71.
152 Wayne Parry, “NJ: Asian Casino Boss Has Mob Ties in China,” Associated Press, March 17, 2010.
153 Department of Justice, “Three More Sentenced as Part of Bureau of Motor Vehicle Fraud Ring,” press release,
August, 19, 2010, http://cleveland.fbi.gov/dojpressrel/pressrel10/cl081910a.htm; Patrick O'Donnell, “Parma Clerk
Issued Illegal Licenses, FBI Charges,” Cleveland Plain Dealer, October 30, 2009.
154 Ceci Connolly, “The Inside Woman,” Washington Post, September 12, 2010, http://www.washingtonpost.com/wpdyn/content/article/2010/09/11/AR2010091105087.html.
(Hereafter, Connolly, “The Inside Woman.”)
155 See testimony by Thomas M. Frost, Assistant Inspector General for Investigations, U.S. Department of Homeland
Security before the U.S. Congress, Senate Committee on Homeland Security and Governmental Affairs, Ad Hoc
Subcommittee on State, Local, and Private Sector Preparedness and Integration, New Border War: Corruption of U.S.
Officials by Drug Cartels, 111 th Cong., 1 st sess., March 11, 2010.
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how many of these corruption cases are attributable to organized crime, they do suggest a
growing challenge for federal law enforcement focused on combating smuggling and trafficking
groups along the border. In an attempt to prevent corruption, federal investigation and law
enforcement agencies may vet potential employees. For instance, in 2009 available resources
allowed CBP to polygraph 10%–15% of applicants applying for border patrol positions, and of
those who were polygraphed, about 60% were found unsuitable for service. 156
Two cases highlight the potential for corruption by organized crime along the Southwest border.
In May 2010, Martha Garnica, a former CBP technician and officer, pleaded guilty to corruption
and drug and alien smuggling charges. 157 She played a significant role in smuggling operations
for the Ciudad Juarez-based La Linea criminal organization. 158 In another case, Jose Raul
Montano, Jr. was sentenced to 140 months in prison for bribery, cocaine trafficking, and alien
smuggling while assigned as a CBP officer at the Brownsville Gateway Port of Entry (POE) in
Brownsville, TX. He allowed Mexican drug traffickers and alien smugglers to illegally transport
drugs and people into the United States. At the POE, Montano permitted vehicles containing
illicit shipments to pass—without inspection—through the lane he worked. In return, Mexican
criminals bribed him. By the time of his arrest in April 2009, he received between $8,000 and
$10,000 per vehicle. 159
Organized Crime, a “National Security” and “Public
Security” Concern
Clearly, organized crime can be seen as a public security concern, largely endangering people,
businesses, and property. In fact, in 1995 the National Intelligence Council (NIC) produced a
National Intelligence Estimate (NIE) on international organized crime that emphasized just this.
However, the U.S. intelligence community’s view of international organized crime has shifted
critically in the intervening years. In early 2010, the NIC issued a second NIE on the topic.
While, according to DOJ officials, most of the salient issues in the 2010 NIE are consistent with
those discussed in the 1995 NIE, a key difference emerged. The 2010 NIE argues that
international organized crime has evolved into a national security concern as well. 160 DOJ
officials have described these national security threats in five broad categories: (1) penetrating or
156 See testimony by James F. Tomsheck, Assistant Commissioner, Office of Internal Affairs, Customs and Border
Protection before the U.S. Congress, Senate Committee on Homeland Security and Governmental Affairs, Ad Hoc
Subcommittee on State, Local, and Private Sector Preparedness and Integration, New Border War: Corruption of U.S.
Officials by Drug Cartels, 111 th Cong., 1 st sess., March 11, 2010.
157 Immigration and Customs Enforcement, “Ex-CBP Employee Receives 20 Years in Drug, Alien Smuggling,
Corruption Case,” press release, August 26, 2010, http://www.ice.gov/pi/nr/1008/100826elpaso.htm.
158 Connolly, “The Inside Woman.”
159 Department of Justice, “Former CBP Officer Sentenced to Prison for Bribery, Cocaine Trafficking, and Alien
Smuggling,” press release, March 31, 2010, http://sanantonio.fbi.gov/dojpressrel/pressrel10/sa033110.htm.
160 Remarks by DOJ officials at the National Institute of Justice Conference 2010, panel on International Organized
Crime: Recent Developments in Policy and Research, June 14, 2010. For this report, “public security threat” means
threats to people, businesses, or property, and “national security threat” means threats to government, sovereignty, and
economic stability. This differentiation is based on John Bailey, Combating Organized Crime and Drug Trafficking in
Mexico: What Are Mexican and U.S. Strategies? Are they Working? Woodrow Wilson International Center For
Scholars, Mexico Institute and University of San Diego Trans-Border Institute, Working Paper Series on U.S.-Mexico
Security Cooperation, Washington, DC, May 2010, p. 3, fn. 2, http://wilsoncenter.org/topics/pubs/
Combating%20Organized%20Crime.%20Bailey.pdf.
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influencing state institutions—particularly in those states with weak governance; (2) threatening
the global economy by infiltrating financial and commercial markets, driving out legitimate
businesses, and using a variety of illegal business practices; (3) engaging in cybercrimes across a
range of fraudulent activities impacting individuals, businesses, and global trust systems; (4)
partnering with terrorist organizations and insurgent groups such as the Revolutionary Armed
Forces of Colombia (FARC), Taliban, and Hezbollah; and (5) expanding the reach of drug
trafficking such that DTOs ally with other criminal organizations—regardless of ethnic
background—and with local drug distributors.
Alleged Eurasian mob boss Semion Mogilevich embodies both the public and national security
dimensions of organized crime. In October 2009, the FBI placed Mogilevich on its Ten Most
Wanted Fugitives list. 161 He is wanted for leading a financial scheme that defrauded investors of
$150 million between 1993 and 1998. The company that he allegedly controlled at the heart of
the operation, YBM Magnex, was based in Newtown, PA, and was incorporated in Canada. 162
Mogilevich was also likely involved in laundering money through YBM Magnex and a network
of offshore companies. 163 By purportedly swindling investors, Mogilevich ran an operation that
harmed members of the public. More broadly—and involving national security interests—the FBI
and DOJ have suggested that the reputed mob boss also has his hands in Eastern European natural
gas markets and that he uses his ill-gotten gains to influence “governments and their
economies.” 164 Russian law enforcement arrested Mogilevich in January 2008 on tax evasion
charges but released him in July 2009 on an oath not to flee. 165
Although analysts have assessed organized crime as being a threat to both public security as well
as a national security, the scope of these threats cannot be fully evaluated without a clearer
understanding of the scope of organized crime.
Conceptualizing Organized Crime
One of the primary challenges in conceptualizing organized crime is that it is usually not thought
of as a specific crime, but rather as a large number of illicit activities committed by groups of
individuals who are often so loosely connected that the members themselves do not know who
their criminal associates may be. This has historically led to a lack of consistency in the way
different groups—scholars, policymakers, various federal law enforcement agencies, and nation
states—view what constitutes organized crime and think about how to combat it. The inconsistent
conceptualization of organized crime has also made it difficult to measure its impact. 166
161 FBI, “Top Ten Fugitives: Global Con Artist and Ruthless Criminal,” October 21, 2009, http://www.fbi.gov/page2/
oct09/mogilevich_102109.html. (Hereafter: FBI, “Global Con Artist.”)
162 FBI, “Philadelphia Fugitive Placed on the FBI’s ‘Ten Most Wanted Fugitives’ List,” press release, October 21,
2009, http://philadelphia.fbi.gov/pressrel/pressrel09/ph102109a.htm. Jeanne Meserve, “FBI: Mobster More Powerful
than Gotti,” CNN, October 24, 2009, http://articles.cnn.com/2009-10-21/justice/mogilevich.fbi.most.wanted_1_fbiwire-fraud-semion-mogilevich?_s=PM:CRIME.
163 Williams, “Transnational Criminal Networks,” p. 70.
164 FBI, “Global Con Artist;” Attorney General Michael B. Mukasey, “Attorney General Michael B. Mukasey Delivers
Remarks at the CSIS Forum on Combating International Organized Crime,” April 23, 2008, Political/Congressional
Transcript Wire.
165 “Russian Court Releases Reputed Crime Boss,” The Associated Press, July 27, 2009.
166 This report focuses on U.S. agency and federal statutory definitions of organized crime. For a discussion of
scholarly definitions, see CRS Report R40525, Organized Crime in the United States: Trends and Issues for Congress,
(continued...)
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The 2011 Strategy laid out the federal government’s first broad conceptualization of
“transnational organized crime,” focusing on it as a national security concern. 167 To what extent
this definition will drive Administration policy is unclear. In evaluating the 2011 Strategy,
policymakers may exercise their oversight authority regarding both the adequacy of the
Administration’s definition of transnational organized crime as well as its utilization in driving
counter-crime policies.
Transnational Organized Crime Defined
The 2011 Strategy offers the following definition of organized crime:
Transnational organized crime refers to those self-perpetuating associations of individuals
who operate transnationally for the purpose of obtaining power, influence, monetary and/or
commercial gains, wholly or in part by illegal means, while protecting their activities
through a pattern of corruption and/or violence, or while protecting their illegal activities
through a transnational organizational structure and the exploitation of transnational
commerce or communication mechanisms. There is no single structure under which
transnational organized criminals operate; they vary from hierarchies to clans, networks, and
cells, and may evolve to other structures. The crimes they commit also vary. Transnational
organized criminals act conspiratorially in their criminal activities and possess certain
characteristics which may include, but are not limited to:
In at least part of their activities they commit violence or other acts which are likely to
intimidate, or make actual or implicit threats to do so;
They exploit differences between countries to further their objectives, enriching their
organization, expanding its power, and/or avoiding detection/apprehension;
They attempt to gain influence in government, politics, and commerce through corrupt
as well as legitimate means;
They have economic gain as their primary goal, not only from patently illegal activities
but also from investment in legitimate businesses; and
They attempt to insulate both their leadership and membership from detection, sanction,
and/or prosecution through their organizational structure. 168
As the term “transnational organized crime” (TOC) may suggest, any definition of it should detail
three elements: (1) “transnationality,” (2) organization, and (3) crime. While the above TOC
definition, and more generally the 2011 Strategy’s text, hit on all three elements, key gaps in
understanding the Administration’s framing of TOC remain.
(...continued)
by Kristin M. Finklea.
167 Strategy to Combat Transnational Organized Crime, p. 5.
168 Strategy to Combat Transnational Organized Crime, p. ii. This definition originally appeared in Department of
Justice, Overview of the Law Enforcement Strategy to Combat International Organized Crime, April 2008, p. 2,
http://www.justice.gov/ag/speeches/2008/ioc-strategy-public-overview.pdf.
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Transnationality
The strategy’s definition addresses the concept of “transnationality” in the broadest terms,
suggesting that TOC is transnational because it operates transnationally. At least three factors—
none of which are discussed in the definition—may determine how transnational a group is:
residence, product provenance, and supply chain complexity. 169
Regarding residence, a TOC group’s members can reside in multiple countries, clearly making it
a transnational network. However, if all members reside in a single country, but a seemingly
minor aspect of the group’s activities is situated outside this home country, is the criminal
network still considered transnational?
• Does controlling a bank account in one country while committing crimes in
another make a network transnational?
• Can a group be considered transnational simply if its communications concerning
criminal activity are routed outside of its home country via international
communications networks?
In terms of product provenance, it seems clear that illicit trade (whether it involves people, goods,
services, or information) from one country to another is a transnational activity. However, can a
domestically based group be considered transnational if the illicit product it handles in the United
States had a foreign origin but the group played no role in getting it across international borders?
• A street-level cocaine dealer may have never directly colluded with foreign
criminals, but the cocaine he retails originated abroad. Does this automatically
make him part of a TOC network? 170
Supply chain complexity is also likely a prominent feature of TOC. This involves managing the
routes that illicit products take.
• Does the complexity of a group’s supply chain factor into measurement of how
transnational the group is? This complexity can include elements such as the
number of borders a product crosses as well as the resources a group expends to
move a product. These resources can include money used for things such as
bribing public officials, protecting illicit routes from other criminals, the
acquisition and retention of technical expertise, and the development of tools and
infrastructure to maintain the route (e.g., shell companies, front companies, drug
smuggling semi-submersibles, cross-border smuggling tunnels).
These factors suggest a broader question: does the level of transnationality inherent in a network
impact how the U.S. government views it as a threat? In other words, if one network is more
transnational than another, is it a greater concern? Would an organized crime group with
transnational ties necessarily be a larger threat than a criminal network based solely in the United
States?
169 von Lampe, “Re-Conceptualizing,” pp. 4-5, discusses the “nature of what crosses the border.” This is subsumed by
product provenance in this report. von Lampe also describes “directionality,” which is part of supply chain complexity
in this report.
170 The product that a TOC group moves across borders should also likely factor in the threat it poses to national
security. A group trafficking firearms may pose a higher threat to national security than an alien smuggling
organization or vise versa. How the strategy ranks these threats is unclear.
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Organization
The TOC definition includes almost any form of organization. This is reflected in the strategy’s
emphasis on the organizational fluidity of TOC. 171 As this may suggest, the definition lacks
precise baselines for the concept of “organization.” Two baselines seem central here. The first
involves routine. In essence, to qualify as “organized” does a network have to routinely
cooperate? If so, what constitutes routine cooperation? The second baseline is size. How small is
“organized”—can it be as basic as two individuals collaborating? Low thresholds for these two
baselines—allowing TOC to include groups as small as two individuals who do not routinely
interact—may render the concept of “organization” meaningless. In other words, with low
thresholds, almost any criminal activity that does not involve a sole operator could be defined as
“organized.” In an attempt to clarify matters, the definition suggests that TOC groups are “selfperpetuating,”
but the definition does not explain what this concept entails. Seemingly, any group
not construed and controlled by some external authority or environmental condition is “selfperpetuating.”
Crime
The TOC definition in the 2011 Strategy broadly describes some of the activities TOC groups can
engage in to turn profits and protect themselves—violence, exploiting the “differences between
countries,” and gaining influence in legitimate sectors. Going beyond the definition, the strategy’s
text lays out 10 areas of illicit activity in which TOC poses “a growing threat to national and
international security.” 172 These 10 areas encompass a wide swath of federal law enforcement
activity.
1. Penetration of State Institutions, Corruption, and Threats to Governance
2. Threats to the Economy, U.S. Competitiveness, and Strategic Markets
3. Crime-Terror-Insurgency Nexus
4. Expansion of Drug Trafficking
5. Human Smuggling
6. Trafficking in Persons
7. Weapons Trafficking
8. Intellectual Property Theft
9. Cybercrime
10. The Critical Role of Facilitators. 173
171 Strategy to Combat Transnational Organized Crime, p. 3.
172 Strategy to Combat Transnational Organized Crime, pp. 5-8.
173 Ibid. “Facilitators” are “semi-legitimate players such as accountants, attorneys, notaries, bankers, and real estate
brokers, who cross both the licit and illicit worlds and provide services to legitimate customers, criminals, and terrorists
alike.” See Ibid., p. 8.
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It is unclear what sway the 2011 Strategy’s definition will hold over what is practically
investigated as “transnational organized crime” by federal agencies. This is because these 10
areas touch on a range of U.S. law enforcement activity that involves many federal agencies,
including numerous components of both DOJ and DHS. The 10 areas clearly enumerate crimes
such as drug and weapons trafficking. However, the areas can subsume other illegal activity. For
example, many crimes related to financial fraud and identity theft potentially fall under
“Cybercrime,” “Intellectual Property Theft,” or “Threats to the Economy, U.S. Competitiveness,
and Strategic Markets.” In the past, numerous investigative programs within the federal
government have been developed to combat crimes subsumed by the 10 areas without specifically
characterizing them as “organized crime.”
Complicating things, neither the definition nor the 2011 Strategy lay out a methodology for
somehow differentiating among TOC actors in terms of the potential impact of their crimes—
namely, the threat they pose to U.S. national security or public interests. Without a methodology
establishing thresholds based on severity, vastly different criminals potentially fall under the
strategy’s purview. A 15-year-old gang member and his friends who illegally download
Hollywood movies from a foreign website is arguably a much different target for law
enforcement than a powerful international mobster with vast economic resources and an army of
foot soldiers. However, the strategy potentially targets both. A form of threat assessment rubric
may focus federal efforts, thus focusing the groups or individuals targeted by the strategy.
While the 2011 Strategy does not articulate a threat assessment methodology, two items suggest
that Administration efforts supporting the strategy involve some calculation of threat. First, an
interagency “Threat Mitigation Working Group” has been given the responsibility of identifying
TOC networks “present[ing] a sufficiently high national security risk.” 174 Whether or not the
networks identified by this working group will be the only ones targeted by efforts embraced
under the strategy is unclear. Second, four TOC groups were listed in an annex to a new executive
order issued in conjunction with the 2011 Strategy. 175 The order established a sanctions program
“to block the property of and prohibit transactions with significant transnational criminal
networks that threaten national security, foreign policy, or economic interests.” 176 While it is
unclear exactly how or why the four groups were chosen, presumably some calculation of threat
was involved. 177
The Definition, 2011 Strategy, and Key Questions
Because the strategy’s TOC definition is broad, it may be difficult to ascertain answers to a
number of questions critical to policymaking (see Figure 1). First, how much harm is imposed by
transnational organized crime? Second, how many federal resources are directly and indirectly
dedicated to combating TOC? Third, which federal agencies are primarily responsible for fighting
TOC? Fourth, how are threats prioritized by the new strategy. Are national security concerns
weighed against other concerns such as public security when targeting specific TOC groups?
Without clear answers to these questions, it may be difficult for Congress to exercise both
174 Ibid., p. 1.
175 Executive Order 13581, “Blocking Property of Transnational Criminal Organizations,” 76 Federal Register 44757-
44759, July 24, 2011.
176 Strategy to Combat Transnational Organized Crime, p. 1.
177 The four TOC groups are the Brothers’ Circle, Camorra, Yakuza, and Los Zetas.
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legislative and oversight responsibilities in order to bolster the federal government’s abilities to
counter organized crime.
Figure 1. Transnational Organized Crime Strategy
Key Issues for Policymakers
Source: CRS
Statutory Definition
There is no current statutory definition of organized crime. The Omnibus Crime Control and Safe
Streets Act of 1968, as amended (P.L. 90-351), 178 had at one point defined organized crime as “the
unlawful activities of the members of a highly organized, disciplined association engaged in
supplying illegal goods and services, including but not limited to gambling, prostitution, loan
sharking, narcotics, labor racketeering, and other unlawful activities of members of such
organizations.” This definition—repealed in the Justice System Improvement Act of 1979 (P.L.
96-157)—appears to be even broader than DOJ’s or the FBI’s conceptualizations. Similarly, in the
Racketeer Influenced and Corrupt Organizations (RICO) 179 provisions, organized crime is
178 Omnibus Crime Control and Safe Streets Act of 1968, as amended (P.L. 90-351).
179 18 U.S.C. § 1961-1968. It was enacted as Title IX of the Organized Crime Control Act of 1970 (P.L. 91- 452).
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described in terms of an “enterprise” and a “pattern of racketeering activity.” 180 The predicate
offenses for racketeering include a host of state and federal crimes listed in 18 U.S.C. § 1961.
Although RICO does not define organized crime, it provides a definition for an “enterprise.” It
does not, however, describe those attributes of a criminal enterprise that distinguish it from a
legal enterprise. In addition, this provision describes organized crime more in terms of the illegal
activities committed by conspirators rather than in terms of the criminal organization. As such,
these statutory provisions could encompass the activities of not only organized crime groups but
of terrorist groups and corrupt businesses as well. Largely describing organized crime as a list of
crimes may help in the effective prosecution of these groups, but it provides little aid in
developing an understanding of the groups themselves. 181 Moreover, the statutory provisions offer
limited guidance regarding criminal organizations and the nature of their operational structure.
Issues
Defining Organized Crime in Statute
Currently, there is no statutory definition of organized crime. RICO 182 provisions describe
organized crime in terms of an “enterprise” and a “pattern of racketeering activity.” 183 The U.S.
Code does not, however, provide guidance and information surrounding the nature of criminal
organizations and their operational structure. There also appears to be a divergence between the
RICO provisions and what federal law enforcement—namely the FBI—considers to be organized
crime. For instance, patterns of racketeering activity specified under RICO indicate that criminal
organizations may be engaged in a host of crimes including, but not limited to, an act or threat
involving murder, kidnapping, gambling, arson, robbery, bribery, extortion, dealing in a
controlled substance, and other illegal activities. Although drug trafficking is included in RICO’s
predicate offenses, law enforcement does not necessarily consider drug trafficking or DTOs to be
within the purview of organized crime investigations. One reason for this may be that federal law
enforcement tends to segment investigations more on the basis of the criminal violation than on
the basis of the criminal actor. While legislating a federal definition of organized crime may not
180 As defined in 18 U.S.C. § 1961, an “‘enterprise’ includes any individual, partnership, corporation, association, or
other legal entity, and any union or group of individuals associated ... although not [necessarily] a legal entity,” and a
“‘pattern of racketeering activity’ requires at least two acts of racketeering activity” to occur within 10 years of one
another for a criminal organization to be prosecuted for racketeering. Racketeering is defined as any number of
violations, including an act or threat involving murder, kidnapping, gambling, arson, robbery, bribery, extortion, or
dealing in a controlled substance. See 18 U.S.C. § 1961 for a comprehensive list of the predicate offenses for
racketeering.
181 Frank E. Hagan, ‘“Organized Crime’ and ‘organized crime’ Indeterminate Problems of Definition,” Trends in
Organized Crime, vol. 9, no. 4 (Summer 2006), p. 127. See also James O. Finkenauer, “Problems of Definition: What
Is Organized Crime?” Trends in Organized Crime, vol. 8, no. 3 (Spring 2005), pp. 63-83.
182 18 U.S.C. § 1961-1968. It was enacted as Title IX of the Organized Crime Control Act of 1970 (P.L. 91- 452).
183 As defined in 18 U.S.C. § 1961, an “‘enterprise’ includes any individual, partnership, corporation, association, or
other legal entity, and any union or group of individuals associated ... although not [necessarily] a legal entity,” and a
“‘pattern of racketeering activity’ requires at least two acts of racketeering activity” to occur within 10 years of one
another for a criminal organization to be prosecuted for racketeering. Racketeering is defined as any number of
violations, including an act or threat involving murder, kidnapping, gambling, arson, robbery, bribery, extortion, or
dealing in a controlled substance. See 18 U.S.C. § 1961 for a comprehensive list of the predicate offenses for
racketeering.
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necessarily solve this disconnect with law enforcement, it might lead to changes in the way law
enforcement views and investigates organized crime.
A second statutory issue that Congress may consider is that of organized crime in the U.S.
Criminal Code. For instance, while there is a Chapter (113B) in Title 18 that deals specifically
with terrorism and related crimes, there is no centralized section that speaks specifically to
organized crime. 184 Yet organized crime has been described as a leading threat to U.S. security.
Though the lack of centralization of organized crime-related statutes may not impact law
enforcement’s abilities to investigate and prosecute organized crime, it is indicative of the
approach by which the federal government views it. And, as mentioned, the harm caused by
organized crime may not be clearly estimated without a common understanding of what defines
organized crime. Building on this, accurately gauging the public and national security threat
posed by organized crime may be complicated without a solid notion of the harm it routinely
causes.
Congressional Commission
Beginning in the 1950s, congressional concern about organized crime has resulted not only in
legislative efforts to combat it, but in commissions and in various series of hearings aimed at
gathering information on the scope of organized crime. One of the first such efforts was the
Senate Special Committee to Investigate Organized Crime in Interstate Commerce in 1950 and
1951 led by Senator Kefauver. Another example of such congressional attention is the series of
Senate hearings on organized crime in 1958 and 1963 led by Senator McClellan. There was also
the 1967 Commission on Crime in the United States led by Attorney General Katzenbach. More
recently, and particularly since the terrorist attacks of September 11, 2001, congressional attention
has shifted away from traditional crime fighting—including organized crime—toward
counterterrorism.
Of the more recent hearings involving organized crime topics, focus has primarily been on threats
posed by the DTOs in Mexico. While this is one of the most visible organized crime threats—not
only are some of the actors exceedingly violent, but this violence is seen directly along the U.S.
Southwest border—it is likely not the sole serious organized crime threat to the United States. As
discussed, numerous other organized crime groups, though perhaps not as violent, commit crimes
that impact the economic stability, public safety, and domestic security of the United States. As
such, one option that Congress may ultimately consider is the convening of a congressional
commission to evaluate the scope of organized crime. Such an evaluation might help
policymakers determine whether they have provided law enforcement with the appropriate tools
to combat today’s threats posed by organized crime. It may also result in a clarification of how
the federal government defines organized crime and consequently how investigative efforts at the
federal level are organized. The Administration has also proposed a legislative package related to
the 2011 Strategy. 185 In light of this, Congress may consider exploring the issue of transnational
organized crime more extensively.
184 Some may consider 18 U.S.C. § 1951-1968 (Chapters 95 and 96, Racketeering and RICO, respectively) to be a
primary portion of the Code addressing organized crime.
185 U.S. Department of Justice, “Statement of Assistant Attorney General Lanny A. Breuer Before the Senate Judiciary
Subcommittee on Crime and Terrorism,” press release, November 1, 2011, http://www.justice.gov/criminal/pr/
testimony/2011/crm-testimony-111101.html.
Congressional Research Service 36

Organized Crime: An Evolving Challenge for U.S. Law Enforcement
Incentives for Investigating Organized Crime
While the effects of certain, high-profile crimes—such as terrorism—are readily seen, the
aftermath of organized crime is not always as striking, nor does it produce the same negative
visceral reactions. Some argue that this may be one reason for the shift in law enforcement
attention and resources more toward counterterrorism-related activities and further away from
traditional crime fighting activities since the terrorist attacks of September 11, 2001. However,
although the effects of organized crime may not be seen in a consolidated attack resulting in the
physical loss of life, the effects are far-reaching. As mentioned, organized crime impacts
economic stability, public health and safety, and national security. Consequently, some experts
argue that there should be some form of incentive (as well as disincentive) to entice law
enforcement to target more monetary and manpower resources toward investigating organized
crime. 186
One such form of incentive that Congress may consider is federal grants to state and local law
enforcement for training and technical assistance to investigate and prosecute organized crime.
There are several grant programs—such as the Community Oriented Policing Services (COPS)
grant program 187 and the Edward Byrne Memorial Justice Assistance Grant (JAG) program 188 —
through which state and local law enforcement assistance is available for a variety of purpose
areas. However, these purposes do not directly specify as a purpose area the use of funds for
combating organized crime. Therefore, policymakers may consider a specific grant program
providing not only funding, but technical training and assistance.
Other suggestions that experts have put forward involve the use of negative peer reviews to
incentivize law enforcement around the world to focus resources toward combating organized
crime. 189 As discussed, various state and federal law enforcement agencies investigate organized
crime in the United States. As such, one option Congress may consider could be to direct the
formation of a domestic peer review system 190 for law enforcement agencies charged with
investigating organized crime. Participation in some form of peer review system could be tied to
law enforcement assistance and grant funding eligibility.
186 International Peace Institute, Transnational Organized Crime: Task Forces on Multilateral Security Capacity, IPI
Blue Papers No. 2, 2009, http://www.ipinst.org/media/pdf/publications/toc_final.pdf. (Hereafter, IPI, Transnational
Organized Crime.)
187 For more information on COPS, see CRS Report RL33308, Community Oriented Policing Services (COPS):
Background and Funding, by Nathan James as well as CRS Report R40709, Community Oriented Policing Services
(COPS): Current Legislative Issues, by Nathan James.
188 For more information on JAG, see CRS Report RS22416, Edward Byrne Memorial Justice Assistance Grant (JAG)
Program, by Nathan James.
189 IPI, Transnational Organized Crime.
190 Peer review systems are used in a variety of academic, professional, and government settings to evaluate an
individual or organization’s work or policies. The work or policies are open to examination by other experts and
equivalent entities. For instance, the Office of Management and Budget (OMB) has promulgated guidelines for federal
regulatory agencies to follow peer review requirements prior to disseminating influential scientific and statistical
information. See Office of Management and Budget, “Guidelines for Ensuring and Maximizing the Quality,
Objectivity, Utility, and Integrity of Information Disseminated by Federal Agencies; Republication,” Vol. 67, No. 36,
Federal Register, February 22, 2002.
Congressional Research Service 37

Organized Crime: An Evolving Challenge for U.S. Law Enforcement
Implementing the National Strategy to Combat TOC
Congress may wish to consider oversight of the national strategy’s implementation by federal law
enforcement agencies. In part, the strategy involves many law enforcement agencies, their
investigative resources, and their intelligence collection efforts. A critical issue may be the
coordination of these activities.
Coordination of Domestic Efforts
As mentioned, the federal investigation of organized crime matters has not historically been a
centralized effort, and even with the 2011 Strategy, there is no single lead agency charged with
investigating organized crime. 191 Specific agencies have had jurisdiction over an organized crime
case based on the criminal violations involved. For instance, organized crime cases built around
drug trafficking offenses have generally been investigated by the DEA, whereas those cases built
around human trafficking cases are typically investigated by ICE. However, many organized
crime cases may involve offenses that fall under the jurisdiction of multiple investigative
agencies. For example, organized crime groups involved in crimes ranging from counterfeiting
and financial institution fraud to identity crimes, computer crimes, and money laundering may be
investigated by the U.S. Secret Service (USSS), FBI, ICE, and any number of other federal, state,
and local law enforcement agencies. As a result of structuring organized crime investigations
around the alleged crimes, it is not always clear which agency will take the lead on a particular
case. This can lead to inter-agency conflicts, and if case information is not effectively
communicated between agencies, each agency involved may not have a comprehensive view of
the case. There are, however, several law enforcement fusion centers, such as the Organized
Crime Drug Enforcement Task Force (OCDETF) Fusion Center (OFC), the International
Organized Crime Intelligence and Operations Center (IOC-2), and the El Paso Intelligence Center
(EPIC), that are charged with consolidating and disseminating intelligence on various organized
crime matters. Additionally, different agencies across federal, state, and local levels participate in
these centers.
For instance, the OFC assimilates information for the OCDETF Program, which targets major
drug trafficking and money laundering organizations. Federal agencies that participate in the
OCDETF Program include the DEA; FBI; ICE; Bureau of Alcohol, Tobacco, Firearms, and
Explosives (ATF); U.S. Marshals; Internal Revenue Service (IRS); U.S. Coast Guard (USCG); 94
U.S. Attorneys Offices; and DOJ’s Criminal and Tax Divisions. These federal agencies also
collaborate with state and local law enforcement.
In May 2009, DOJ announced the creation of the IOC-2—housed at the OFC—which brings
together the FBI; ICE; DEA; IRS; ATF; U.S. Secret Service; U.S. Postal Inspection Service
(USPIS); U.S. Department of State, Bureau of Diplomatic Security; U.S. Department of Labor,
Office of the Inspector General; and DOJ’s Criminal Division in partnership with the 94 U.S.
Attorneys’ Offices and the U.S. Department of the Treasury, Office of Terrorism and Financial
Intelligence. Unlike the OFC, the IOC-2 has yet to be funded. 192 It is charged with analyzing and
191 For a discussion of federal law enforcement efforts to combat organized crime, see CRS Report R40525, Organized
Crime in the United States: Trends and Issues for Congress, by Kristin M. Finklea.
192 In the FY2011 Budget Request, the Administration requests an additional $15.0 million for the Department of
Justice to combat organized crime. $7.6 million of this is requested for funding DOJ staffing of the IOC-2. There were
no specific funds requested for the other agencies contributing to the IOC-2.
Congressional Research Service 38

Organized Crime: An Evolving Challenge for U.S. Law Enforcement
resolving conflicts in information on a host of organized crime cases, not solely those that center
on drug trafficking.
EPIC was originally established as an intelligence center to collect and disseminate information
relating to drug, alien, and weapon smuggling in support of field enforcement entities throughout
the Southwest border region. Following 9/11, counterterrorism also became part of its mission.
Though these crimes are not exclusively committed by organized crime groups, they may be, and
thus EPIC is involved in combating organized crime. EPIC is jointly operated by the DEA and
U.S. Customs and Border Protection (CBP), and other participating agencies include ICE, USCG,
U.S. Secret Service, Department of Defense (DOD), Department of the Interior, FBI, ATF, U.S.
Marshals Service, Federal Aviation Administration, National Drug Intelligence Center (NDIC),
IRS, National Geospatial-Intelligence Agency, Joint Task Force-North, Joint Interagency Task
Force-South, Texas Department of Public Safety, Texas Air National Guard, and El Paso County
Sheriff’s Office.
In evaluating the most effective means to share organized crime intelligence, Congress may
consider several options. One option may include increasing support for intelligence fusion
centers such as the OFC, IOC-2, and EPIC. Another option could involve the creation of an
interagency organization similar to the National Counterterrorism Center (NCTC), but centered
around organized crime. Such an organization would be responsible for “analyzing the [organized
crime] threat, sharing that information with … partners, and integrating all instruments of
national power to ensure unity of effort” 193 against organized crime. On the prosecution end, DOJ
has already announced a proposed consolidation of the Organized Crime and Racketeering
Section (OCRS), the Criminal Division’s gang unit, and the National Gang Targeting,
Enforcement, and Coordination Center (GangTECC) into a single Organized Crime and Gang
Section. 194 This harmonizes the prosecution of organized crime and gang cases, which DOJ has
cited as being similar.
One non-legislative option that Congress may consider regarding the coordination of federal law
enforcement efforts to combat organized crime is enforcing its oversight over existing fusion
centers. In June 2010, the DOJ Office of the Inspector General (OIG) issued a review of EPIC. 195
The OIG found that EPIC’s users value its products, but that EPIC could benefit from
improvement in fully developing the National Seizure System and coordinating the High Intensity
Drug Trafficking Area (HIDTA) program, consistently coordinating with intelligence
organizations across the country, maintaining and analyzing current information from all
available sources, and creating objective performance measures by which to evaluate its
programs, among other things. Similarly, in November 2009 the OIG reviewed DOJ’s anti-gang
intelligence and coordination centers. 196 As a result of the review, the OIG determined that the
National Gang Intelligence Center had not created a gang information database, as had been
directed by Congress.
193 NCTC mission statement, available at http://www.nctc.gov/about_us/about_nctc.html.
194 Ryan J. Reilly, “Gang Unit, Organized Crime Section to Merge,” Main Justice, July 12, 2010.
195 Department of Justice, Office of the Inspector General, Review of the Drug Enforcement Administration’s El Paso
Intelligence Center, I-2010-005, June 2010, pp. ii - iii, http://www.justice.gov/oig/reports/DEA/a1005.pdf.
196 Department of Justice, Office of the Inspector General, A Review of the Department’s Anti-Gang Intelligence and
Coordination Centers, I-2010-001, November 2009, http://www.justice.gov/oig/reports/FBI/i2010001.pdf.
Congressional Research Service 39

Organized Crime: An Evolving Challenge for U.S. Law Enforcement
Author Contact Information
Jerome P. Bjelopera
Specialist in Organized Crime and Terrorism
jbjelopera@crs.loc.gov, 7-0622
Kristin M. Finklea
Specialist in Domestic Security
kfinklea@crs.loc.gov, 7-6259
Congressional Research Service 40

Page 344 of 372

Attachment C
Transnational Organized Crime – The Globalized
Illegal Economy
Page 345 of 372

FACTS
Transnational Organized Crime –
The Globalized Illegal Economy
The fictionalized images of organized crime are far from the
truth. The reality is less Hollywood and far more about fluid
organized criminal networks profiting from the sale of illegal
goods wherever there is a demand. These international illegal
markets are anonymous and more complex than ever and each
year generate billions of dollars.
Every year, countless lives are lost as a result of organized
crime. Drug-related health problems and violence, firearm
deaths and the unscrupulous methods and motives of human
traffickers and migrant smugglers are all part of this. Each year
millions of victims are affected as a result of the activities of
organized crime groups.
Transnational organized crime is big business. In 2009 it was
estimated to generate $870 billion — an amount equal to
1.5 per cent of global GDP. 1 That is more than six times the
amount of official development assistance for that year, and
the equivalent of close to 7 per cent of the world’s exports of
merchandise.
Hidden cost to society
Transnational organized crime encompasses virtually all serious
profit-motivated criminal actions of an international nature
where more than one country is involved. There are many
activities that can be characterized as transnational organized
crime, including drug trafficking, smuggling of migrants,
human trafficking, money-laundering, trafficking in firearms,
counterfeit goods, wildlife and cultural property, and even
some aspects of cybercrime. It threatens peace and human
security, leads to human rights being violated and undermines
the economic, social, cultural, political and civil development
of societies around the world. The vast sums of money involved
can compromise legitimate economies and have a direct impact
on governance, such as through corruption and the “buying”
of elections.
Different forms of transnational organized crime
Transnational organized crime is not stagnant, but is an everchanging
industry, adapting to markets and creating new
forms of crime. In short, it is an illicit business that transcends
cultural, social, linguistic and geographical boundaries and one
that knows no borders or rules.
Drug trafficking continues to be the most lucrative form of
business for criminals, with an estimated annual value of $320
billion. 2 In 2009, UNODC placed the approximate annual worth
of the global cocaine and opiate markets alone at $85 billion
and $68 billion, respectively. 3
Human trafficking is a global crime in which men, women
and children are used as products for sexual or labour-based
exploitation. While figures vary, an estimate from the International
Labour Organization (ILO) in 2005 indicated the
number of victims of trafficking at any given time to be
around 2.4 million, with annual profits of about $32 billion.
4 Recent research on overall forced labour trends however
would suggest that the scope of the problem is much bigger. 5
In Europe, the trafficking of mostly women and children for
Transnational organized crime:
Let’s put them
out of business
www.unodc.org/toc

FACTS
sexual exploitation alone brings in $3 billion annually and
involves 140,000 victims at any one time, with an annual flow
of 70,000 victims. 6
Smuggling of migrants is a well-organized business moving
people around the globe through criminal networks, groups
and routes. Migrants can be offered a “smuggling package”
by organized crime groups, and the treatment they get along
the route corresponds to the price they pay to their smugglers.
In the process of being smuggled, their rights are often
breached and they can be robbed, raped, beaten, held for
ransom or even left to die in some cases, when the risks get
too high for their smugglers. Many smugglers do not care
if migrants drown in the sea, die of dehydration in a desert
or suffocate in a container. Every year this trade is valued at
billions of dollars. In 2009 some $6.6 billion was generated
through the illegal smuggling of 3 million migrants from
Latin America to North America, 7 while the previous year
55,000 migrants were smuggled from Africa into Europe for a
sum of $150 million. 8
Illicit trading in firearms brings in around $170 million to
$320 million annually 9 and puts handguns and assault rifles
in the hands of criminals and gangs. It is difficult to count the
victims of these illicit weapons, but in some regions (such as
the Americas) there is a strong correlation between homicide
rates and the percentage of homicides by firearms. 10
Trafficking in natural resources includes the smuggling of raw
materials such as diamonds and rare metals (often from conflict
zones). The trafficking of timber in South-East Asia generates
annual revenues of $3.5 billion. 11 In addition to funding criminal
groups, this strand of criminal activity ultimately contributes
to deforestation, climate change and rural poverty.
The illegal trade in wildlife is another lucrative business for
organized criminal groups, with poachers targeting skins
and body parts for export to foreign markets. Trafficking in
elephant ivory, rhino horn and tiger parts from Africa and
South-East Asia to Asia produces $75 million in criminal
profits each year and threatens the existence of some species.
12 Organized crime groups also deal in live and rare plants
and animals threatening their very existence to meet demand
from collectors or unwitting consumers. According to the
WWF, traffickers illegally move over 100 million tons of fish,
1.5 million live birds and 440,000 tons of medicinal plants
per year. 13
The sale of fraudulent medicines is a worrying business, as it
represents a potentially deadly trade for consumers. Piggybacking
on the rising legitimate trade in pharmaceuticals from Asia
to other developing regions, criminals traffic fraudulent medicines
from Asia, in particular to South-East Asia and Africa to
the value of $1.6 billion. 14 Instead of curing people, however,
they can result in death or cause resistance to drugs used to
treat deadly infectious diseases like malaria and tuberculosis. In
addition to traditional trafficking methods, criminals continue
to build a lucrative online trade in fraudulent medicines targeting
developed and developing countries alike, which can also
lead to health implications for consumers.
Cybercrime encompasses several areas, but one of the most
profitable for criminals is identity theft, which generates around
$1 billion each year. 15 Criminals are increasingly exploiting the
Internet to steal private data, access bank accounts and fraudulently
attain payment card details.
Global threats, local effects
While transnational organized crime is a global threat, its effects
are felt locally. When organized crime takes root it can
destabilize countries and entire regions, thereby undermining
development assistance in those areas. Organized crime groups
can also work with local criminals, leading to an increase in
corruption, extortion, racketeering and violence, as well as a
range of other more sophisticated crimes at the local level. Violent
gangs can also turn inner cities into dangerous areas and
put citizens’ lives at risk.
Organized crime affects people in the developing and the developed
worlds. Money is laundered through banking systems.
People become victims of identity theft, with 1.5 million people
each year being caught out. 16 In many developed countries,
criminal groups traffic women for sexual exploitation and children
for purposes of forced begging, burglary and pickpocketing.
Car theft is also an organized business, with vehicles stolen
to order and taken abroad. Fraudulent medicines and food
products enter the licit market and not only defraud the public
but can put their lives and health at risk. Added to this is the
trade in counterfeit products, which deprives countries of tax
revenues. This can also have an impact on legitimate companies
when illegally produced goods displace sales of original products,
which in turn hurts employer revenues.
Organized crime adds to an increase in public spending for
security and policing and undermines the very human rights
standards that many countries strive to preserve, particularly
when activities such as human trafficking in human beings,
kidnapping and extortion are taken into consideration. It can
also fuel local crime, which in turn drives up costs such as
insurance premiums and adds to the general level of criminality
and insecurity in society.
Transnational organized crime:
Let’s put them
out of business
www.unodc.org/toc

FACTS
Too hot to handle. How is money laundered?
The profits of most crimes are generated as cash, which is risky
for criminals. Difficult to hide, cash increases the probability
of exposure, theft by rival criminals and seizure by the police.
When cash enters the legitimate economy, it is particularly vulnerable
to identification and law enforcement intervention. As
a result, criminals move to prevent cash from attracting suspicion.
For example, they may move it abroad, or they might use
it to buy other assets or try to introduce it into the legitimate
economy through businesses that have a high cash turnover. As
an integral part of transnational organized crime, it is estimated
that some 70 per cent of illicit profits are likely to have been
laundered through the financial system. Yet less than 1 per cent
of those laundered proceeds are intercepted and confiscated. 17
Putting them out of business. What can we do about
organized crime?
Combating a global phenomenon such as transnational organized
crime requires partnerships at all levels. Governments, businesses,
civil society, international organizations and people in
all corners of the world have a part to play. Some aspects that
are critical in fighting organized crime include:
• Coordination: integrated action at the international level
is crucial in identifying, investigating and prosecuting the
people and groups behind these crimes.
• Education and awareness-raising: ordinary citizens should
learn more about organized crime and how it affects
everyday lives. Express your concerns to policy and decision
makers so that this truly global threat is considered by
politicians to be a top priority among the public’s major
concerns. Consumers also have a key role to play: know
what you are purchasing, do so ethically and make sure that
you do not fuel organized crime.
• Intelligence and technology: criminal justice systems and
conventional law enforcement methods are often no match
for powerful criminal networks. Better intelligence methods
need to be developed through the training of more specialized
law enforcement units, which should be equipped with
state-of-the-art technology.
• Assistance: developing countries need assistance in building
their capacity to counter these threats. An important
tool that can help with this is the United Nations Convention
against Transnational Organized Crime, which has
been ratified by 170 parties 18 and provides a universal legal
framework to help identify, deter and dismantle organized
criminal groups. In October 2012 the sixth session of the
Conference of the Parties to the United Nations Convention
against Transnational Organized Crime will be held in
Vienna. That biennial series of meetings brings together
Governments from across the world to promote and review
the execution of the Convention in order to ensure better
implementation in tackling this international issue. At
a practical level, UNODC helps strengthen the capacity of
States to track and prevent money-laundering with training
and technical assistance for following the money trail. These
measures can help cut off the profits of crime.
Disclaimer
This fact sheet has not been formally edited. The content of this fact sheet does not necessarily reflect the views or policies of UNODC or contributory
organizations and neither does it imply any endorsement. The designations employed and the presentation of material in this fact sheet does not imply the
expression of any opinion whatsoever on the part of UNODC concerning the legal status of any country, territory or city or its authorities, or concerning the
delimitation of its frontiers and boundaries.
Transnational organized crime:
Let’s put them
out of business
www.unodc.org/toc

FACTS
1
United Nations Office on Drugs and Crime, Estimating Illicit Financial
Flows Resulting from Drug Trafficking and Other Transnational
Organized Crimes: Research Report (Vienna, October 2011). Available
from www.unodc.org/documents/data-and-analysis/Studies/Illicit_
financial_flows_2011_web.pdf.
2
Based on 2005 figures (World Drug Report 2011 (United Nations
publication, Sales No. E.11.XI.10)). Available from www.unodc.org/wdr.
3
World Drug Report 2011.
4
Based on 2005 estimates from the International Labour Organization
(ILO). More recent and precise estimates by ILO on overall forced
labour trends however would lead us to think that the scope of
the problem is much bigger. (International Labour Office, A Global
Alliance against Forced Labour: Global Report under the Followup
to the ILO Declaration on Fundamental Principles and Rights
at Work (Geneva, ILO, 2005)). Available from www.ilo.org/wcmsp5/
groups/public/@ed_norm/@declaration/documents/publication/
wcms_081882.pdf.
5
International Labour Organization, Global Estimate of Forced Labour
2012: Results and Methodology (Geneva, ILO, 2012). Available
from http://www.ilo.org/sapfl/Informationresources/ILOPublications/
WCMS_182004/lang--en/index.htm
6
United Nations Office on Drugs and Crime, “Trafficking in persons to
Europe for sexual exploitation”, June 2010. Available from www.unodc.
org/documents/publications/TiP_Europe_EN_LORES.pdf.
7
The Globalization of Crime: A Transnational Organized Crime Threat
Assessment (United Nations publication, Sales No. E.10.IV.6.2010).
Available from www.unodc.org/documents/data-and-analysis/tocta/
TOCTA_Report_2010_low_res.pdf.
8
Ibid.
9
UNODC.
10
United Nations Office on Drugs and Crime, 2011 Global Study on
Homicide: Trends, Contexts, Data (2011). Available from www.unodc.
org/documents/data-and-analysis/statistics/Homicide/Globa_study_
on_homicide_2011_web.pdf.
11
The Globalization of Crime: A Transnational Organized Crime Threat
Assessment.
12
Ibid.
13
See http://wwf.panda.org/about_our_earth/species/problems/illegal_
trade/
14
Globalization of Crime: A Transnational Organized Crime Threat
Assessment.
15
Ibid.
16
Ibid.
17
United Nations Office on Drugs and Crime, Estimating Illicit Financial
Flows Resulting from Drug Trafficking.
18
See http://treaties.un.org/Pages/ViewDetails.spx?src=TREATY&mtdsg_
no=XVIII-12&chapter=18&lang=en.
Transnational organized crime:
Let’s put them
out of business
www.unodc.org/toc

Page 346 of 372

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Part II – Jobs Training, Educational
Redevelopment
and Economic Empowerment
Part III - Financial Literacy
and Sustainability
Q-1 2029
Q-2 2029
Q-3 2029
LXVII Part IV – Solutions for Homelessness Q-4 2029
LXVIII
The Strategic Home Mortgage
Initiative
Bonus
Vol. XVI 2030 Sustainability
LXVIII Social Program Sustainability Q-1 2030
LXIX
The Advocacy Foundation
Endowments Initiative
Q-2 2030
LXX Capital Gains Q-3 2030
LXXI Sustainability Investments Q-4 2030
Vol. XVII 2031 The Justice Series
LXXII Distributive Justice Q-1 2031
LXXIII Retributive Justice Q-2 2031
LXXIV Procedural Justice Q-3 2031
LXXV (75) Restorative Justice Q-4 2031
LXXVI Unjust Legal Reasoning Bonus
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Vol. XVIII 2032 Public Policy
LXXVII Public Interest Law Q-1 2032
LXXVIII Reforming Public Policy Q-2 2032
LXXVIX ... Q-3 2032
LXXVX ... Q-4 2032
Page 355 of 372

The e-Advocate Monthly Review
2018
Transformational Problem Solving January 2018
The Advocacy Foundation February 2018
Opioid Initiative
Native-American Youth March 2018
In the Juvenile Justice System
Barriers to Reducing Confinement April 2018
Latino and Hispanic Youth May 2018
In the Juvenile Justice System
Social Entrepreneurship June 2018
The Economic Consequences of
Homelessness in America S.Ed – June 2018
African-American Youth July 2018
In the Juvenile Justice System
Gang Deconstruction August 2018
Social Impact Investing September 2018
Opportunity Youth: October 2018
Disenfranchised Young People
The Economic Impact of Social November 2018
of Social Programs Development
Gun Control December 2018
2019
The U.S. Stock Market January 2019
Prison-Based Gerrymandering February 2019
Literacy-Based Prison Construction March 2019
Children of Incarcerated Parents April 2019
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African-American Youth in The May 2019
Juvenile Justice System
Racial Profiling June 2019
Mass Collaboration July 2019
Concentrated Poverty August 2019
De-Industrialization September 2019
Overcoming Dyslexia October 2019
Overcoming Attention Deficit November 2019
The Gift of Adversity December 2019
2020
The Gift of Hypersensitivity January 2020
The Gift of Introspection February 2020
The Gift of Introversion March 2020
The Gift of Spirituality April 2020
The Gift of Transformation May 2020
Property Acquisition for
Organizational Sustainability June 2020
Investing for Organizational
Sustainability July 2020
Biblical Law & Justice TLFA August 2020
Gentrification AF September 2020
Environmental Racism NpA October 2020
Law for The Poor AF November 2020
…
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2021
Biblically Responsible Investing TLFA – January 2021
International Criminal Procedure LMI – February 2021
Spiritual Rights TLFA – March 2021
The Theology of Missions TLFA – April 2021
Legal Evangelism, Intelligence,
Reconnaissance & Missions LMI – May 2021
The Law of War LMI – June 2021
Generational Progression AF – July 2021
Predatory Lending AF – August 2021
The Community Assessment Process NpA – September 2021
Accountability NpA – October 2021
Nonprofit Transparency NpA – November 2021
Redefining Unemployment AF – December 2021
2022
21 st Century Slavery AF – January 2022
Acquiesce to Righteousness TLFA – February 2022
ComeUnity Capacity-Building NpA – March 2022
Nonprofit Organizational Assessment NpA – April 2022
Debt Reduction AF – May 2022
Case Law, Statutory Law,
Municipal Ordinances and Policy ALG – June 2022
Organizational Dysfunction NpA - July 2022
Institutional Racism Collab US – August 2022
Page 358 of 372

The Ripple Effects of Ministry TLFA - September 2022
The Sarbanes-Oxley Act of 2002 NpA – October 2022
Organized Crime (In The New Millennium) ALG – May 2022
…
Page 359 of 372

The e-Advocate Quarterly
Special Editions
Crowdfunding Winter-Spring 2017
Social Media for Nonprofits October 2017
Mass Media for Nonprofits November 2017
The Opioid Crisis in America: January 2018
Issues in Pain Management
The Opioid Crisis in America: February 2018
The Drug Culture in the U.S.
The Opioid Crisis in America: March 2018
Drug Abuse Among Veterans
The Opioid Crisis in America: April 2018
Drug Abuse Among America’s
Teens
The Opioid Crisis in America: May 2018
Alcoholism
The Economic Consequences of June 2018
Homelessness in The US
The Economic Consequences of July 2018
Opioid Addiction in America
Page 360 of 372

The e-Advocate Journal
of Theological Jurisprudence
Vol. I - 2017
The Theological Origins of Contemporary Judicial Process
Scriptural Application to The Model Criminal Code
Scriptural Application for Tort Reform
Scriptural Application to Juvenile Justice Reformation
Vol. II - 2018
Scriptural Application for The Canons of Ethics
Scriptural Application to Contracts Reform
& The Uniform Commercial Code
Scriptural Application to The Law of Property
Scriptural Application to The Law of Evidence
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Legal Missions International
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Issue Title Quarterly
Vol. I 2015
I
II
God’s Will and The 21 st Century
Democratic Process
The Community
Engagement Strategy
Q-1 2015
Q-2 2015
III Foreign Policy Q-3 2015
IV
Public Interest Law
in The New Millennium
Q-4 2015
Vol. II 2016
V Ethiopia Q-1 2016
VI Zimbabwe Q-2 2016
VII Jamaica Q-3 2016
VIII Brazil Q-4 2016
Vol. III 2017
IX India Q-1 2017
X Suriname Q-2 2017
XI The Caribbean Q-3 2017
XII United States/ Estados Unidos Q-4 2017
Vol. IV 2018
XIII Cuba Q-1 2018
XIV Guinea Q-2 2018
XV Indonesia Q-3 2018
XVI Sri Lanka Q-4 2018
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Vol. V 2019
XVII Russia Q-1 2019
XVIII Australia Q-2 2019
XIV South Korea Q-3 2019
XV Puerto Rico Q-4 2019
Issue Title Quarterly
Vol. VI 2020
XVI Trinidad & Tobago Q-1 2020
XVII Egypt Q-2 2020
XVIII Sierra Leone Q-3 2020
XIX South Africa Q-4 2020
XX Israel Bonus
Vol. VII 2021
XXI Haiti Q-1 2021
XXII Peru Q-2 2021
XXIII Costa Rica Q-3 2021
XXIV China Q-4 2021
XXV Japan Bonus
Vol VIII 2022
XXVI Chile Q-1 2022
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The e-Advocate Juvenile Justice Report
______
Vol. I – Juvenile Delinquency in The US
Vol. II. – The Prison Industrial Complex
Vol. III – Restorative/ Transformative Justice
Vol. IV – The Sixth Amendment Right to The Effective Assistance of Counsel
Vol. V – The Theological Foundations of Juvenile Justice
Vol. VI – Collaborating to Eradicate Juvenile Delinquency
Page 365 of 372

The e-Advocate Newsletter
Genesis of The Problem
Family Structure
Societal Influences
Evidence-Based Programming
Strengthening Assets v. Eliminating Deficits
2012 - Juvenile Delinquency in The US
Introduction/Ideology/Key Values
Philosophy/Application & Practice
Expungement & Pardons
Pardons & Clemency
Examples/Best Practices
2013 - Restorative Justice in The US
2014 - The Prison Industrial Complex
25% of the World's Inmates Are In the US
The Economics of Prison Enterprise
The Federal Bureau of Prisons
The After-Effects of Incarceration/Individual/Societal
The Fourth Amendment Project
The Sixth Amendment Project
The Eighth Amendment Project
The Adolescent Law Group
2015 - US Constitutional Issues In The New Millennium
Page 366 of 372

2018 - The Theological Law Firm Academy
The Theological Foundations of US Law & Government
The Economic Consequences of Legal Decision-Making
The Juvenile Justice Legislative Reform Initiative
The EB-5 International Investors Initiative
2017 - Organizational Development
The Board of Directors
The Inner Circle
Staff & Management
Succession Planning
Bonus #1 The Budget
Bonus #2 Data-Driven Resource Allocation
2018 - Sustainability
The Data-Driven Resource Allocation Process
The Quality Assurance Initiative
The Advocacy Foundation Endowments Initiative
The Community Engagement Strategy
2019 - Collaboration
Critical Thinking for Transformative Justice
International Labor Relations
Immigration
God's Will & The 21st Century Democratic Process
The Community Engagement Strategy
The 21st Century Charter Schools Initiative
2020 - Community Engagement
Page 367 of 372

Extras
The Nonprofit Advisors Group Newsletters
The 501(c)(3) Acquisition Process
The Board of Directors
The Gladiator Mentality
Strategic Planning
Fundraising
501(c)(3) Reinstatements
The Collaborative US/ International Newsletters
How You Think Is Everything
The Reciprocal Nature of Business Relationships
Accelerate Your Professional Development
The Competitive Nature of Grant Writing
Assessing The Risks
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Page 369 of 372

About The Author
John C (Jack) Johnson III
Founder & CEO – The Advocacy Foundation, Inc.
________
Jack was educated at Temple University, in Philadelphia, Pennsylvania and Rutgers
Law School, in Camden, New Jersey. In 1999, he moved to Atlanta, Georgia to pursue
greater opportunities to provide Advocacy and Preventive Programmatic services for atrisk/
at-promise young persons, their families, and Justice Professionals embedded in the
Juvenile Justice process in order to help facilitate its transcendence into the 21 st Century.
There, along with a small group of community and faith-based professionals, “The Advocacy Foundation, Inc." was conceived
and developed over roughly a thirteen year period, originally chartered as a Juvenile Delinquency Prevention and Educational
Support Services organization consisting of Mentoring, Tutoring, Counseling, Character Development, Community Change
Management, Practitioner Re-Education & Training, and a host of related components.
The Foundation’s Overarching Mission is “To help Individuals, Organizations, & Communities Achieve Their Full Potential”, by
implementing a wide array of evidence-based proactive multi-disciplinary "Restorative & Transformative Justice" programs &
projects currently throughout the northeast, southeast, and western international-waters regions, providing prevention and support
services to at-risk/ at-promise youth, to young adults, to their families, and to Social Service, Justice and Mental
Health professionals” in each jurisdiction served. The Foundation has since relocated its headquarters to Philadelphia,
Pennsylvania, and been expanded to include a three-tier mission.
In addition to his work with the Foundation, Jack also served as an Adjunct Professor of Law & Business at National-Louis
University of Atlanta (where he taught Political Science, Business & Legal Ethics, Labor & Employment Relations, and Critical
Thinking courses to undergraduate and graduate level students). Jack has also served as Board President for a host of wellestablished
and up & coming nonprofit organizations throughout the region, including “Visions Unlimited Community
Development Systems, Inc.”, a multi-million dollar, award-winning, Violence Prevention and Gang Intervention Social Service
organization in Atlanta, as well as Vice-Chair of the Georgia/ Metropolitan Atlanta Violence Prevention Partnership, a state-wide
300 organizational member violence prevention group led by the Morehouse School of Medicine, Emory University and The
Original, Atlanta-Based, Martin Luther King Center.
Attorney Johnson’s prior accomplishments include a wide-array of Professional Legal practice areas, including Private Firm,
Corporate and Government postings, just about all of which yielded significant professional awards & accolades, the history and
chronology of which are available for review online at LinkedIn.com. Throughout his career, Jack has served a wide variety of
for-profit corporations, law firms, and nonprofit organizations as Board Chairman, Secretary, Associate, and General Counsel
since 1990.
www.TheAdvocacy.Foundation
Clayton County Youth Services Partnership, Inc. – Chair; Georgia Violence Prevention Partnership, Inc – Vice Chair; Fayette
County NAACP - Legal Redress Committee Chairman; Clayton County Fatherhood Initiative Partnership – Principal
Investigator; Morehouse School of Medicine School of Community Health Feasibility Study Steering Committee; Atlanta
Violence Prevention Capacity Building Project Partner; Clayton County Minister’s Conference, President 2006-2007; Liberty In
Life Ministries, Inc. Board Secretary; Young Adults Talk, Inc. Board of Directors; ROYAL, Inc Board of Directors; Temple
University Alumni Association; Rutgers Law School Alumni Association; Sertoma International; Our Common Welfare Board of
Directors President 2003-2005; River’s Edge Elementary School PTA (Co-President); Summerhill Community Ministries
(Winter Sports Athletic Director); Outstanding Young Men of America; Employee of the Year; Academic All-American -
Basketball; Church Trustee; Church Diaconate Ministry (Walking Deacon); Pennsylvania Commission on Crime & Delinquency
(Nominee).
www.TheAdvocacyFoundation.org
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