Law and Justice Around the World

CRIM 405.003

Prof. Andrew Novak

TRANSNATIONAL ORGANIZED CRIME

DEFINING ORGANIZED CRIME• Organized crime has the following characteristics:

• Continuing criminal enterprise

• Crimes are rationally planned

• Requires force, threats, monopoly control, or corruption to insulate itself from prosecution

• Caters to public demand for illicit goods and services (economic motive)

• DISTINGUISH: Terrorism, which has a political motive, and not a profit seeking one. However, many terrorist organizations resemble organized criminal syndicates.

• Example: Irish Republic Army and arms trafficking; Al-Qaida and the Taliban and the international opium trade (heroin); FARC (Columbia) and cocaine

THE SCOPE OF ORGANIZED CRIME• Enormous number of possible crimes:

• Trade in human beings (or body parts), drugs, nuclear material, works of art

• Piracy and banditry

• Environmental threats, including ivory and endangered species trades and unregulated dumping of toxic waste

• Financial crimes: Fraud, embezzlement, pilfering of foreign aid, illegal export of resources, counterfeiting of patented products, systematic tax evasion, laundering of money from illegal transactions, etc.

• Like terrorism, technology has changed the parameters of organized crime (commercial flights for drug trafficking, the internet for financial crime, etc.).

• Bleeds into corruption, as many criminal enterprises attempt to bribe or influence government officials to preserve their impunity.

CHARACTERISTICS OF ORGANIZED CRIME

• Like all economic enterprises, organized crime is sensitive to supply and demand. It often targets countries with a high level of economic development because demand is highest.

• Unlike terrorism, which often has a revolutionary ethos and seeks drastic change, organized crime is often inherently conservative, seeking to protect its clandestine economic activity and cozy relationships with government officials.

• Ethnicity trap: The (often false) assumption that organized crime is carried out by ethnic, clan, or kinship networks, but how organized crime follows or cross-cuts other societal cleavages is highly politically and culturally contingent.

• Mafia (Italy) and Yakuza (Japan) are strongly hierarchical and possess great influence in their localities, having cultivated a reputation over many years. But today, many organized criminal groups have more devolved or looser structures (similar to terrorism).

CYBERCRIME• The misuse of computers and the internet to carry out criminal activity. “Cybercrime”

refers to the method rather than a particular offense, since many different crimes can be carried out through the misuse of computers.

• Fraud is the most common example, but can also include threats, extortion, stolen property transfers, violations of intellectual property (e.g., illegal downloads), and most recently “cyberbullying.”

• Objective: nearly always financial gain.

• Identity theft: Unauthorized use of a victim’s personal identifying information to commit fraud or other services.

• Advance fee fraud: Victims convinced to pay in advance for a good or service, and after payment they receive nothing of value.

• Overpayment fraud: Victim deposits invalid monetary instrument in a bank account and transfer excess funds back to the sender.

HUMAN TRAFFICKING• Trafficking in human beings involves moving victims by using fraud or coercion and then

exploitation for profit. Often includes the continued restriction of movement and enforced labor or prostitution.

• Tracked by a host of international organizations (such as the International Labor Organization), governments, and non-governmental organizations.

• DISTINGUISH: Human smuggling, which is the illicit transfer of people across borders. Typically consensual and does not include economic exploitation. By contrast, human trafficking is a labor violation.

• Child soldiers: Unlawful recruitment of children as combatants or other forms of labor by armed forces. Constitutes a war crime, and may be subject to international prosecution.

• Example: The International Criminal Court has convicted Thomas Lubanga of war crimes through the recruitment and use of child soldiers in the Democratic Republic of the Congo. He is the ICC’s first and (so far) only conviction.

DRUG TRAFFICKING• Production: The world’s most common illicit drug is cannabis, which is grown across all

continents and in nearly all countries. Cocaine is second, and then heroin and amphetamine-type stimulants.

• Trafficking: While cannabis trafficking tends to be locally produced and consumed, cocaine trafficking is interregional and is transported and sold in vast international drug networks (heroin is both intra- and inter-regional).

• Consumption: About 5% of the world’s population aged 15-64 used illicit substances at least once in the previous year, about 150 to 270 million people. In comparison, 25% of the world’s adult population are current tobacco smokers.

• Recent trend in the illegal trade in pharmaceutical products and in synthetic drugs (unregulated substances that imitate the properties of traditional drugs).

CORRUPTION• A form of organized crime that is perpetuated by government officials rather than

clandestine, non-state actors such as gangs.

• Defined as the misuse of public office for private gain.

• Difficult to detect, root out, and prevent because it requires enforcement of government officials by other government officials.

• Worst in resource-poor countries with high rates of unemployment, or where politics is highly unstable.

• Managing corruption:

• Office of the ombudsman, public protector, etc.

• Whistleblower retaliation protections, independent audits

• International cooperation (INTERPOL, UN Convention Against Corruption)

CORRUPTION AND THE CRIMINALIZATION OF THE STATE• In some of the world’s countries, the government is so thoroughly “criminalized” that it is

difficult to tell where legitimate government activity ends and an organized criminal enterprise begins.

• This is particularly true in weak or fragile states, which lack the capacity to provide many ordinary government functions.

• In these states, there is a hidden, collective structure of power which surrounds and controls public offices. State officials personally benefit from the misuse of government resources (including coercion and violence) with impunity.

• Example: Zaire during the 1980s and 1990s. The state was highly predatory, taking over all legitimate businesses and looting them of assets; public officials misappropriated billions of dollars in foreign aid; government provided virtually no social services and had little physical control outside the capital city.

• Revisionist view: State was relatively successful in spreading around the spoils among political rivals in order to prevent armed insurrection and state collapse.

FOREIGN CORRUPT PRACTICES ACT (U.S.)• Broad extraterritorial application of U.S. law: U.S. citizens/residents, U.S.-registered

corporations, or corporations that do business with the United States are subject to the provisions of the FCPA.

• Prosecuted by U.S. Department of Justice for bribing foreign officials.

• Very strict provisions apply to publicly-traded corporations (including those based outside the U.S. but that trade on U.S. stock markets), which are subject to large fines and criminal prosecution by the Securities and Exchange Commission.

• International Anti-Bribery Act: U.S. law that implements several international anti-corruption conventions by making it illegal for an American citizen or business, or a person or business acting within the U.S., to influence, bribe, or seek advantage from a foreign government official.

• Large American corporations have been hit with FCPA prosecutions, including Wal-Mart. A growing area of practice for those interested in white collar crime.

INTERNATIONAL LAW• United Nations Convention Against Corruption

• United Nations Convention Against Transnational Organized Crime

• Protocol to Suppress and Punish Trafficking in Persons

• Protocol Against Smuggling of Migrants

• Protocol Against Illicit Manufacturing and Trafficking in Firearms

• Inter-American Convention Against Corruption

• OECD Anti-Bribery Convention