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Madam Chairperson and Members of the Committee, thank you for the opportunity to speak to you today on this important subject.
The attacks against the United States on September 11 stunned us all. They also made it very clear that the mission of the Bureau for International Narcotics and Law Enforcement Affairs (INL) -- to provide support to counternarcotics and other anti-crime efforts worldwide -- is more important now than ever.
While INL does not have the lead in the war on terrorism, we strongly support these efforts through our counternarcotics and crime control activities, which provide training, equipment and institutional support to many of the same host nation law enforcement agencies that are charged with a counter-terrorist mission. We are also working on the diplomatic front, both multilaterally and bilaterally, to strengthen our counternarcotics and law enforcement cooperation with other governments with a special focus on bringing these tools to bear in the fight against terrorism. For example, in the G-8 we have since September 11 combined the efforts of Lyon (crime) and Roma (counterterrorism) experts groups to enhance cooperation on a range of specific issues, including counternarcotics in relation to Afghanistan.
There often is a nexus between terrorism and organized crime, including drug trafficking. Links between terrorist organizations and drug traffickers take many forms, ranging from facilitation -- protection, transportation, and taxation -- to direct trafficking by the terrorist organization itself in order to finance its activities. Traffickers and terrorists have similar logistical needs in terms of materiel and the covert movement of goods, people and money.
Relationships between drug traffickers and terrorists benefit both. Drug traffickers benefit from the terrorists' military skills, weapons supply, and access to clandestine organizations. Terrorists gain a source of revenue and expertise in illicit transfer and laundering of proceeds from illicit transactions. Both groups bring corrupt officials whose services provide mutual benefits, such as greater access to fraudulent documents, including passports and customs papers. Drug traffickers may also gain considerable freedom of movement when they operate in conjunction with terrorists who control large amounts of territory.
SIMILARITY OF METHODS
Terrorist groups and drug trafficking organizations increasingly rely on cell structures to accomplish their respective goals. While there may be a strong central leadership, day-to-day operations are carried out by members of compartmentalized cells. This structure enhances security by providing a degree of separation between the leadership and the rank-and-file. In addition, terrorists and drug traffickers use similar means to conceal profits and fund-raising. They use informal transfer systems such as "hawala," and also rely on bulk cash smuggling, multiple accounts, and front organizations to launder money. Both groups make use of fraudulent documents, including passports and other identification and customs documents to smuggle goods and weapons. They both fully exploit their networks of trusted couriers and contacts to conduct business. In addition, they use multiple cell phones and are careful about what they say on the phone to increase communications security.
The methods used for moving and laundering money for general criminal purposes are similar to those used to move money to support terrorist activities. It is no secret which countries and jurisdictions have poorly regulated banking structures, and both terrorist organizations and drug trafficking groups have made use of online transfers and accounts that do not require disclosure of owners. Moreover, bulk cash smuggling methods and informal networks such as "hawala" and the black market peso exchange are easy and efficient ways to launder money. Criminal networks are in a perfect position to use methods that require doctoring of passports or customs declaration forms. These methods are unlikely to change in the near term. Though many countries have been quick to update their regulations, few have the law enforcement structure in place to carry out interdiction. If law enforcement capabilities improve globally, in the long term traffickers and terrorists may increasingly use trusted individual couriers, or more complex balance transfers in informal networks.
INL has worked with the Departments of Justice and Treasury and with nations around the world to strengthen controls which could thwart the drug traffickers' attempts to launder their funds and to investigate and prosecute those who are involved in moving criminal proceeds. These same law enforcement controls also help prevent the movement of funds of terrorist organizations.
Moreover, many of the skills and types of equipment needed to attack organized crime are applicable to combating terrorism. Much of INL's assistance -- such as the provision of equipment for forensic labs; assistance with drafting asset forfeiture and money laundering legislation; and provision of basic training in investigation techniques, maritime enforcement and port security -- applies to both counternarcotics and counterterrorism. Migrant smuggling, document fraud, arms trafficking, auto theft, smuggling of contraband, and illegal financial transactions are tools for terrorists as well as narcotics traffickers.
FROM STATE-SPONSORSHIP TO DRUG TRAFFICKING
In the past, state sponsors provided funding for terrorists, and their relationships with terrorist organizations were used to secure territory or provide access to gray arms networks. Lately, however, as state sponsorship of terrorism has come under increased scrutiny and greater international condemnation, terrorist groups have looked increasingly at drug trafficking as a source of revenue. But trafficking often has a two-fold purpose for the terrorists. Not only does it provide funds, it also furthers the strategic objectives of the terrorists. Some terrorist groups believe that they can weaken their enemies by flooding their societies with addictive drugs.
Growing pressure on state sponsors of terrorism has increased the likelihood that terrorists will become involved in the drug trade. Interdiction of terrorist finances and shutdowns of "charitable" and other non-governmental front organizations have also contributed to their convergence. Terrorist groups are increasingly able to justify their involvement in illicit activity to their membership and have largely abandoned the belief that it can damage the moral basis for their cause.
Listed below, by geographic region, are terrorist organizations that are known to have connections to drug-trafficking. Most of these organizations have been officially designated as Foreign Terrorist Organizations (FTOs) by the Secretary of State.
In the Western Hemisphere, there is an historic link between various terrorist groups and narcotics trafficking. The Shining Path cut a brutal swath through Peru from the 1980s to the mid- 1990s, largely funded by levies the group assessed on cocaine trafficking. In Ciudad del Este, Paraguay, and along the loosely controlled region that it borders with Brazil and Argentina, members of radical Islamic groups are reported to be engaged in money laundering, intellectual property rights piracy, alien smuggling, and arms trafficking.
The Andean region is the source of virtually all the world's cocaine. Colombia, Peru and Bolivia, in that order, are the primary producers of coca and the final products. The presence of terrorist organizations in Colombia and Peru -- and their need to finance operations -- establishes a natural symbiotic relationship to exploit drugs as a revenue source.
The linkage between drugs and terrorism in Colombia is one that particularly concerns us and one that we watch carefully. In the 1990s, the international drug cartels operating in Colombia embarked on a campaign of violence that severely challenged the authority and even the sovereignty of the Colombian state. The September 11 attacks illustrate in graphic detail the serious threat posed by forces hostile to the United States operating under the cover and protection of a narco-terrorist state. In light of recent events in Colombia, the potential for increased violence between the government and terrorist groups, and the growing linkage between terrorism and drug trafficking, we are reviewing our policy options there. At present, there are three terrorist groups operating in Colombia including the FARC, ELN, and AUC.
Revolutionary Armed Forces of Colombia (FARC)
National Liberation Army (ELN)
United Self-Defense Groups of Colombia (AUC)
Shining Path (Sendero Luminoso SL) (Peru)
Tri-Border Islamic Groups
South Asia & Former Soviet Union
Throughout this region, proximity to cultivation and production, combined with the infrastructure provided by the traffickers, has encouraged mutually beneficial relationships between terrorist groups and drug trafficking organizations.
Kashmiri militant groups
Liberation Tigers of Tamil Eelam (Sri Lanka)
Islamic Movement of Uzbekistan (IMU)
Kurdistan Workers' Party (PKK)
Basque Fatherland and Liberty (ETA)
United Wa State Army (UWSA) (Burma)
Thank you, again, Madam Chairperson and Members of the Committee, for the opportunity to discuss these issues with you.
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