Pubdate: Mon, 22 Sep 2014
Source: National Post (Canada)
Copyright: 2014 Canwest Publishing Inc.
Contact: http://drugsense.org/url/wEtbT4yU
Website: http://www.nationalpost.com/
Details: http://www.mapinc.org/media/286
Author: Adrian Humphreys
Page: A1

A BLACK-MARKET ECONOMICS LESSON

Why do drug traffickers risk everything to smuggle their cargo across 
a border? Because they can double their revenue, as shown by a drug 
haul found by U.S. authorities before it could be transported into Canada.

When 15 kilograms of cocaine and nine kilograms of methamphetamine 
were seized in the Grandview Business Center in Ferndale, Wash., its 
street value was US$550,000. If the planned run had been completed - 
just 17-kilometres north, past the Peace Arch border into British 
Columbia - the street value would have jumped to more than $1 
million, said the U.S. Immigration and Customs Enforcement. It's a 
lesson in black-market economics. "The street value goes up the 
further north you go. Most of it comes from the south, south of the 
U.S. border," said Andrew Munoz, spokesman for the U.S. Immigration 
and Customs Enforcement. Crossing borders adds the most value.

"There's cost involved, there is risk. Couple that with the high demand."

The production cost of cocaine, for example, is low, especially 
compared with its high retail price on North American streets; its 
increased value comes from high demand, risk compensation and 
smuggling expense.

And one thing about drug traffickers, they are capitalist to the 
core, always on the prowl for increased profit.

This load of drugs were quietly seized on Sept. 10, but only revealed 
by authorities last week when photos of the drugs were released in an 
attempt to identify the dealers.

"We have credible information to believe they were destined for 
Canada. We work with Canada Border Services and the RCMP," said Mr. Munoz.

Each brick of cocaine is crisply branded with the capital letters: "VITO."

Mr. Munoz said he has no information to suggest the brand is a 
reference to Vito Rizzuto, the Mafia boss from Montreal who died in 
December. He said investigation indicates the original owners were 
from the southern hemisphere and the buyers local.

The role of borders in the economics of drug trafficking has long 
been a key factor in the trade, no less so in the Washington-British 
Columbia border region. A large drug network in the area was targeted 
by authorities in 2011 with seizures, raids and the arrest of 12 
people in Canada and the United States.

They were accused of exploiting the border with Canada to maximize 
their drug profits by bringing Canada's marijuana south to sell at a 
premium in the United States and using the proceeds to buy cocaine in 
California and sending it north for the higher revenue in Canada.

In Canada it was delivered to members of the Hells Angels Motorcycle 
Club for distribution, court heard.

When the U.S. ringleader, Jacob Saul Stuart, 39, from a Seattle 
suburb, was sentenced to 15 years in prison, U.S. Attorney Jenny 
Durkan said: "His lust for drug money disregarded the harm he spread 
throughout communities in the U.S. and Canada, and enriched a violent 
criminal gang."

In 2012, James Postlethwaite, 60, of North Vancouver, B.C., was 
sentenced to 12 years in prison for his role as a drug courier for 
hiding cocaine and marijuana in secret compartments in a 40-foot 
semi-trailer for cross-border runs.

The new case is still under investigation and details of the 
circumstances of the night-time seizure at the business centre and 
how authorities learned of it are not being released, said Mr. Munoz.

"We do have persons of interest," he said. And authorities are 
expecting them to be illicit entrepreneurs.
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MAP posted-by: Jay Bergstrom