2007 Threat #10 Transnational Crime Forecast

PDF:  10 TransnationalCrime

THREAT:  Transnational Crime

The only real sign of a recession is when the Mafia starts laying off judges in New Jersey.  – Anon. / Traditional

Estimates vary widely on the value of transnational organized crime (TOC) — the FBI uses an estimate of $1 trillion per year. A key instrument in addressing TOC world-wide is the United Nations Convention against Transnational Organized Crime of September 2003 which commits signatories to introduce a range of measures such as the creation of domestic criminal offences, frameworks for multilateral juristic and police cooperation, and extradition.* The UN Office on Drugs and Crime (UNODC) finds that TOC groups commonly comprise 20-50 persons involved in 5 or more countries. UNODC has defined five TOC typologies – standard hierarchy, regional hierarchy, clustered hierarchy, core group, criminal network – that move beyond the mob boss model to the reality of actual groups. This is useful for tactical purposes and helps agencies achieve a common vocabulary.

TOC has diversified from traditional domains of local mob crime — “numbers racket”, protection, prostitution, and illicit drugs – to take full commercial advantage of globalized markets and the internet. The same network that moves drugs across the world can be adapted to transfer arms, explosives, cash, or untaxed tobacco. Organised Immigration Crimes – people smuggling, human trafficking – can move illegal immigrants, sex slaves, criminals or terrorists across the world. TOC moves into areas of petty crime when the rewards are sufficient, displacing local petty criminals or recruiting them (stolen motor vehicle). In this way TOC underpins much local crime. Similarly, TOC moves into new profitable areas such as identity theft, phishing, intellectual property crime (fake/unlicensed brands), cultural property crime (smuggling of artifacts), and environmental crime (illegal dumping, wildlife smuggling, illegal logging and, soon, water theft). TOC also enables other illegal activities by supply of false documents, protection, assassinations, and (in the UK) hire of weapons for criminal activity by other parties. TOC activities lend themselves to high degrees of product integration and vertical and/or horizontal integration – enslaved sex-workers or foot-soldiers are often addicted to the drugs traded by the same criminal enterprise.

But any mutation of TOC uses the traditional tools – suborning of officials, violence and coercion, secrecy, and willingness to break laws. Common to all activities is cash which is paramount in unlawful transactions. This creates a continual need for money-laundering for conversion into real assets such as property, legitimate businesses or laundered (seemingly lawful) cash.

TOC activity comprises a multitude of criminal acts, but agencies must focus on the enabling organization. To make a conviction for a single crime will often be counter-productive. TOC groups have such organizational and financial depth that they generally survive the neutralization of individual members. Also any minor agency success may merely teach the TOC how to improve its operations. Hence intelligence and counter-intelligence are crucially important, as is proactive policing rather than reactive policing instinctive to compliance officers. Compliance agencies must adapt to the changing methods and interests of TOC sometimes by reinventing themselves. In the UK the Serious Organised Crime Agency (SOCA) was launched in April 2006, bringing together the National Crime Squad, the National Criminal Intelligence Service, and elements of Customs and Immigration that dealt with TOC. In the US, the FBI Organized Crime Program addresses TOC in geographic units such as La Cosa Nostra and Italian Organized Crime, Asian Criminal Enterprises. Some in the UK envy the US RICO (Racketeer Influenced and Corrupt Organizations) Act, purpose-built anti-racketeering legislation introduced in 1964, but others fear the slippery slope of legislation based on a guilty until proven innocent principle. One successful example of new structures for new challenges is Europol, established in 1999  with intelligence and proactive policing functions (not to be confused with Interpol, which has served as a documentation exchange since establishment in 1923).

Philosophically it is legality itself that is one enabler of TOC which can only operate in illegal (“black market”) environment. Alcohol prohibition created the speak-easy which became a revenue stream for organized crime. States such as Netherlands that license rather than outlaw prostitution and some drugs have eradicated criminal revenue, and the cost of law enforcement, in those commodities.

UNODC and others have emphasized the global nexus between corruption, terrorism and crime; for instance, “terrorists” may buy illicit weapons or materials from transnational syndicates with global reach and know-how. This nexus is crucial but must include aspects of aid and foreign affairs. Officials who are found corrupt in diversion of foreign aid are more easily suborned by TOC. North Korea’s strategic counterfeiting of $100 super-notes finds obvious synergies with money laundering and other TOC activity. In the Philippines it is now difficult to distinguish between separatist raising funds and simple crime in actions such as kidnapping for ransom. Also in the Philippines a numbers racket (jueteng) is so wide spread as to have implicated the husband of President Arroyo.
The reality is that Transnational Organized Crime is a fifth estate (and fifth column) just as dangerous as any perceived terror from Islamic fundamentalism.


Governments that are them-selves not directly involved in TOC are easily impressed of the need for enforcement by the loss of revenue. In fighting for elusive budgets this is effective enough but it misses that point that TOC suborns and perverts the Rule of Law itself. Just as some argue that “terrorism” is a political and policing issue rather than military, key politicians and officials need to recognise that TOC is not just a police or revenue matter but subversion just as dangerous as any bombing to the health of a society.


Much good work has been done by UNODC and others on the metrics and topology of TOC but largely within the silo of compliance agencies. A better, more revealing picture may come from coordination between these agencies and diplomatic and security intelli-gence agencies. Demarcation between many insurgencies and mere criminal activity may become clearer. Also, the direct role of states such as North Korea in TOC may be better understood through an exchange of information from political as well as policing silos.


As robber barons (core nominals) amass greater wealth across generations and become firmly entrenched behind legitimate businesses or in distant countries, TOC will be seen as truly a world-wide fifth estate. The laws and practices of first the tiniest and then larger nations will be suborned as mere tools and fronts for a sinister force ultimately more deadly than the minority views of Osama bin Laden. In one dimension, a policy of zero- tolerance is needed; in another legalization of those things that make TOC possible.