Pubdate: Thu, 24 Aug 2000
Source: Jane's Intelligence Review (UK)
Copyright: 2000 Jane's Information Group Ltd
Contact:  Sentinel House, 163 Brighton Road, Coulsdon, Surrey CR5 2NH, UK
Website: http://jir.janes.com/
Author: Dr Mark Galeotti, Jane's Intelligence Review
Note: Dr Mark Galeotti is Director of the Organised Russian and Eurasian 
Crime Research Unit at Keele University, UK and an adviser to the LENS 
Global Forum.

CRIMES OF THE NEW MILLENNIUM

If the last century was dominated by cold wars, then the struggle
against organised and transnational crime will be a defining theme of
the next. To launch this regular feature, Dr Mark Galeotti considers
the evolution of the transnational criminal environment.

THE TURN-OVER of the global criminal economy is roughly estimated to
be US$1 trillion a year, of which narcotics may account for about
half. Around 4% of the world's population takes illegal drugs - from
inhaled solvents to the Asian betel nut. Up to half a trillion dollars
are laundered through the world's financial systems each year. The
Organisation for Economic Co-operation and Development (OECD)
estimates that this money laundering has cost member states over $120
billion per year, with the USA accounting for $76 billion.

Global organised crime is evolving, embracing new markets and
technologies, and moving from traditional hierarchies towards more
flexible, network-based forms of organisation. To an extent, the
legitimate world is a victim of its own success: globalisation of the
legal economy has also globalised the underworld, prosperity fuels the
demand for many illicit services and improved policing forces
criminals to become more organised in order to survive.  The late
Claire Sterling popularised the notion of a 'Pax Mafiosa', the concept
that international organised crime groupings were working together
efficiently and harmoniously, and dividing the globe between them.
There is ample evidence of co-operation: Italian syndicates sell Latin
American drugs in Europe, Russians buy stolen cars from the Yakuza and
Albanians move Asian heroin for Turkish drug clans.

It would, however, be a mistake to take this too far. Many of these
arrangements are very loose, little more than mutually-profitable
trades or temporary alliances of convenience. If anything, there is
scope for future conflicts within the global underworld as markets
become saturated and the opportunities for further peaceful expansion
exhausted.

In many ways the traditional demarcations between national security
and law enforcement concerns are becoming increasingly unclear.
Serious and organised crime can directly affect national security
resources, whether undermining state budgets - with implications for
defence expenditure - or threatening morale and discipline.

Beijing's concerns about the criminalisation of its military elites
was one of the main reasons behind its efforts to end its involvement
in commercial activities. In Russia, the penetration of organised
crime has had a more direct and immediate impact, with special forces
moonlighting as hitmen and weapons being sold even to Chechen rebels
(see JIR June 1999, pp 8-10).

In this respect, there is a direct carry-over. Organised and
transnational crime groups act as agents of instability and
insecurity. The haemorrhage of weapons from former Soviet military
stockpiles, a trade facilitated and often run by organised crime,
fuelled the Balkan arms race and put high-order firepower into the
hands of every Balkan faction, gang and militia.

Organised crime is often powerful enough to create its own 'states-
within-states'. From the poppy fields of Uzbekistan's Fergana Valley
and the warlord territories of Myanmar (formerly Burma), to the so-
called 'Farclandia' enclave in Colombia and Morocco's cannabis-
growing Rif region, organised crime undermines the integrity of the
host state and of national borders.

Crime has long been used as a tactic to fund political insurgency.
However, many organisations, such as the remnants of the Peruvian
Sendero Luminoso and elements of the Northern Ireland paramilitary
forces, have lost their political rationale and become little more
than organised crime groupings with a line in anachronistic rhetoric.

As some terrorists evolve into criminals, organised criminal groups
become increasingly politically active and lobby, bribe or corrupt
legitimate governments. In Serbia, recent crime-related murders, such
as the killing of Serbian paramilitary warlord Zeljko 'Arkan'
Raznatovic, suggest a degree of criminalisation within the regime, a
phenomenon well entrenched in Latin America, Africa and Asia. However,
it would be foolish to pretend that this is not a problem in Europe
and North America - it simply tends to adopt more subtle guises.

It is important to consider changes within the wider context in which
crime operates. Political developments are defining the new global
underworld. The collapse of the USSR was a seismic event that
unleashed a new and fast-moving form of organised crime onto the world
(see JIR March 2000, pp 10). However, the return of Hong Kong and
Macau to Chinese control, war in the Balkans and many other
geopolitical upsets have had serious implications for the global
underworld. The Balkan wars, for example, made it even harder to block
heroin-trafficking routes into Europe from the south-west. The spread
of migrants and refugees into the European Union (EU) also created new
criminal networks, especially the Albanians who now handle much of the
wholesale heroin trafficking for Turkish gangs.

Other political processes are opening up new markets and havens for
organised crime. The Schengen Accords (which opened borders within the
EU) and the future expansion of the EU eastwards have criminal
implications, making international criminal traffic within the region
increasingly cost-effective. Many countries risk becoming 'hooked' on
the trade. By 1999, for example, Mexico's narcotics industry was worth
an estimated $30 billion in profits, four times the revenue from the
country's largest legal export, oil.

Another process at work is the apparent blurring of boundaries between
crime, espionage and statecraft. This is not unprecedented; criminals
have often been useful tools for espionage agencies but involvement
with crime has become not just a short-term expedient but a basic
policy. The Democratic People's Republic of Korea (DPRK), for example,
is an increasingly important source of narcotics, to the extent that
this reflects the activities of corrupt 'untouchables' and desperate
military and security officers. However, the criminalisation of North
Korean elites, for example, appears to be turning into a
criminalisation of state policy. Drugs trafficking is being embraced
as a means of bringing new revenue into a destitute state, and
developing new intelligence-gathering routes and contacts.

Economic and technological change is putting new tools in the hands of
the criminals, including internet banking, and the security and
flexibility of the digital cellphone. It is also putting unprecedented
power into the hands of a small number of people: while transnational
crime is often organised, computer hacking, for example, can be a
solitary process. In 1994 $3.7 million was stolen from Citibank by
Vladimir Levin, a Russian computer hacker, working with only a handful
of accomplices. The evolution of technology and the laws relating to
it also create new crimes, such as the burgeoning global trade in CFCs
('greenhouse gases') and toxic waste.

Even physical and environmental changes can have an impact on the
global underworld. Global warming, for example, can play its part in
changing the geography of drug production and is already allowing the
production of opium and marijuana in new areas of southern Russia.

Since 1986 the US government has formally recognised drug smuggling as
a national security threat and, however limited its successes, Moscow
has also highlighted crime as a challenge in successive security
doctrines. Intelligence agencies are therefore not only being deployed
against transnational and organised crime, but are also developing
their own specialists in this field (see JIR July, pp 50-52).

An encouraging global trend is the growing awareness of crime as a
national security issue, but much still needs to be done. Barriers
between law enforcement, intelligence and defence communities need to
be lowered, and a variety of fora - including Jane's Intelligence
Review - can help in this vital process.
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