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Diplomacy in Action

Leveraging Partnerships to Combat Corruption, Money Laundering, and Illicit Networks


Remarks
David M. Luna
Director for Anticrime Programs, Bureau of International Narcotics and Law Enforcement Affairs
Towards an Archipelago of Security Across the Caribbean
Curacao, Netherlands
March 13, 2013

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Good Morning.

Let me extend the greetings of my new boss, Secretary of State John Kerry, who has already demonstrated his commitment to working with all of our partners in this hemisphere and across the globe to address today’s security challenges, and to enduring peace and shared prosperity.

It is a pleasure to have been invited to participate this week at the Caribbean Basin Coastal Surveillance Security Summit 2013. First, I would like to thank the organizers—the International Quality and Productivity Center (IQPC) and Defence IQ—and their sponsors for putting together this outstanding program. Let me also thank all the other extraordinary speakers and participants who have brought here their commitment to protecting our citizens and communities and charting new pathways to security.

To the Caribbean nations and partners from the international donor and law enforcement communities: the United States stands ready to continue working with you to reduce illicit trafficking across our hemisphere and beyond, and to shield our citizens from the growing threats of transnational crime, corruption, and terrorism.

Following the Money to Combat Converging Threats

Ladies and gentlemen, in recent years, our hemisphere has seen the rise of violent criminal networks vying for a greater market share in the global illegal economy. We have learned that when we apply pressure on these networks in one place, they adapt their operations and routes to new places. They bring with them violence, firepower, and corruption.

We saw this “balloon effect” in the 1990s: when Colombia cracked down on drug production and trafficking, these activities increased in other Andean countries, like Ecuador, Peru and Bolivia. New trafficking routes emerged, and the counter-narcotics battlefield shifted to Mexico. Sustained pressure by Mexican security forces in recent years has forced the cartels to push their operations into Central America. Honduras, Guatemala, and Belize are now suffering a staggering increase in drug trafficking and crime.

The United States remains committed to supporting our partners in Mexico and Central America to break the power of the cartels and make it more difficult for drugs to enter North American markets. And not only drugs. These same networks are also trafficking humans, weapons, natural resources, and counterfeits that pose health and safety risks.

At the same time, we recognize that we cannot allow our efforts in one part of the hemisphere to trigger an increase in crime and violence in another part of the hemisphere, nor anywhere else in the world. We must think strategically and collectively to fight cross-border illicit and criminal threats and mitigate their harms to our communities. We must identify and target the common denominator of all criminal organizations and illicit activities.

Ladies and gentlemen, the common denominator is money. If criminal organizations cannot launder the proceeds of crime, they cannot operate. According to the United Nations Office on Drugs and Crime (UNODC), kleptocrats and criminal entrepreneurs hide the proceeds of their crimes in legal structures such as offshore shell companies and foundations, then launder most of that through financial institutions into the global financial system. In 2012, eight Caribbean nations or territories were designated by the United States as jurisdictions of primary concern for money laundering activities. UNODC reported that the Caribbean is the “most important destination for the laundering of cocaine-related income.”

We all want to ensure that our efforts to combat drug networks in Central America and Mexico don’t open the door for increased illicit activities in the Caribbean.

Given the strategic position of the Caribbean and the directional shipping volume between Latin American and European countries via sea lanes, it is not difficult to imagine how trafficking in a wide array of illegal commodities may be preventing jurisdictions across the hemisphere from reaching their full economic potential. Illicit trade brings negative externalities to the economies it affects, including corruption, illicit financial flows, depleted government revenues from taxes and customs, decreased foreign investment, decreased tourism, and slow economic growth.

This is our task in Curacao: to find ways to cooperate, coordinate, and strengthen regional law enforcement and security efforts to support, train and equip our partners to combat corruption and organized crime, deny market entry of illicit goods and services, enhance air and maritime domain awareness, increase interdictions, and shut down maritime illicit routes.

I know that my Department of Defense colleague will say more about our Secure Seas initiative, which provides patrol boats and state-of-the-art communication systems to nine Caribbean countries, so I will take this opportunity to highlight concrete ways in which the United States is strengthening partnerships in the Caribbean, the Americas, and globally to combat transnational crime and corruption.

Organized Crime Trends and Threats in the Western Hemisphere

First, I want to underscore recent trends and reports that reflect the grave situation we are facing today:

  • In 2012, the World Economic Forum’s Global Competitiveness Report found that of 144 countries, the Dominican Republic placed 144/144 in “wastefulness of government spending,” and 142/144 in “diversion of public funds;” Haiti ranked 144/144 in “public trust in politicians,” and 143/144 in “transparency of government policymaking;” and on the “business costs of crime and violence metric”, the Dominican Republic ranked 127/144 and Haiti ranked 138/144.
  • In 2011, the U.S. and Dominican Republic counter-narcotics agencies took down a drug trafficking group linked to the Sinaloa Cartel that had laundered money in the Dominican Republic, United States, Jamaica, Venezuela, Colombia, and Canada.
  • In 2012, Dominican authorities arrested members of a bulk cash smuggling operation that had smuggled upwards of $350 million over 5 years to Panama, Colombia, and Venezuela. Authorities also seized 20 luxury vehicles, apartments, and weapons as part of the operation.
  • The Inter-American Convention Against Corruption held in 2010 disclosed figures suggesting that over $1 billion is laundered annually in the Dominican Republic (nearly 2% of GDP). In 2008 annual money laundering was estimated to be $820 million.
  • In the Cayman Islands, there have been six money-laundering convictions since 2006. In the Bahamas there were 0 money-laundering prosecutions in 2011. Others jurisdictions also have low numbers of convictions.

If we ignore these warning signs, we are preparing ourselves for things to get worse. Continued insecurity, violence, and social marginalization enable other threat networks to exploit weak borders and recruit disillusioned youths into criminal and possibly terrorist networks. In response, we must further strengthen our own networks to push back those who seek to expand the illegal economy and export violence and criminality. To succeed, we must do this as equal partners with respect for our shared interests and values.

The U.S.-Caribbean Shared Security Partnership: A Pillar for Collective Action

This morning, I would like to outline how the United States plans to continue working with our partners through the U.S.-Caribbean Shared Security Partnership, the Caribbean Basin Security Initiative (CBSI), and other diplomatic initiatives to promote more resilient economies and safer communities.

The United States has already contributed over $200 million to CBSI alone to improve the security situation in the Caribbean, and billions more on other security assistance programs across the hemisphere over the past 10 years. Through CBSI, the United States is helping our partners in the Caribbean Community (CARICOM) and the Dominican Republic to reduce illicit trafficking substantially, increase public safety and security, and promote social justice, including through justice sector reform, anti-corruption programs, education, and training.

Since the inaugural Caribbean-U.S. Security Cooperation Dialogue in 2010, U.S. and Caribbean government representatives have met on numerous occasions to define and develop a joint strategy and operational framework for action based on a joint assessment of regional priorities.

Our CBSI activities complement other regional efforts, such as the Merida Initiative in Mexico, security assistance in Colombia, the Central America Regional Security Initiative (CARSI), and other assistance investments that support partner governments’ efforts to make their streets safer for their citizens by strengthening institutions of governance and the rule of law, including the judiciary, law enforcement, and defense.

Strengthening Capacities and Political Will to Combat Transnational Crime

Internationally, the United States has ramped up our efforts to combat transnational organized crime. In July 2011, the White House released President Barack Obama’s Strategy to Combat Transnational Organized Crime. A key pillar of the Strategy is to enhance international cooperation with key partners to combat the lethal nexus of organized crime, narco-trafficking, and terrorism, and to protect our communities from the violence, harm, and exploitation wrought by transnational threat networks.

Along with CSBI, the Strategy to Combat Transnational Organized Crime provides a framework for the Department of State to continue to support security programs in the Caribbean in the coming years. Other U.S. government agencies will also remain involved, including the Department of Defense’s Joint Interagency Task Force-South (JIATF-S) and U.S. Southern Command, the U.S. Coast Guard, and other U.S. law enforcement agencies and fusion centers, which are enhancing coordination and cooperation with other committed governments around this region to combat transnational criminal threats from a variety of perspectives:

Law Enforcement Capacity Building and Justice Sector Reform

First, many Caribbean nations have demonstrated the will to expand their capacity to administer justice under the rule of law, but most do not have the resources or expertise to train their police and security services.

Under CBSI, we have been providing training in community-based policing, investigation of money laundering and financial crimes, and drug interdiction by increasing partner nations’ capacities on land, air and sea. We will continue to provide training in these fields. To counter drug trafficking organizations, CBSI provides training equipment and US law enforcement operational support to vetted police units in The Bahamas, the Dominican Republic, and Jamaica.

In addition to specialized training, CBSI assistance in the region provides specific anti-crime technologies to investigate and apprehend illicit actors. For example, under our Regional Information Sharing Project we have provided forensics equipment for the collection and sharing of ballistics information. Funds have already established three “hubs” in Barbados, Jamaica, and Trinidad and Tobago capable of sharing digital ballistics data. We are also currently implementing a digital fingerprint program that will make it possible for eight Caribbean countries to not only collect, transmit, and search digital biometric information, but it will also enable them to convert their existing paper fingerprint cards into useable digital biometric information.

Maritime and Aerial Security Cooperation

The United States is working with Caribbean nations to strengthen maritime interdiction operational capacity to counter narcotics trafficking and has provided interceptor boats and training to support interdiction operations.

We are improving land, maritime and air domain awareness by supporting the Cooperative Sensor and Information Integration (CSII) Initiative, an unclassified system that provides a broad operating picture to all participating nations, helping foster greater interoperability among regional partners and our Joint Interagency Task Force-South.

CBSI funds will expand the Caribbean Technical Assist Field Team (TAFT) from a staff of three to an eventual staff of 15. The TAFT will provide all partner nations with technical and logistical assistance, increasing capacity to maintain maritime assets.

Several Caribbean nations have yet to sign the requisite agreements to participate in these initiatives. The United States encourages those nations to complete these agreements quickly in order to benefit from the valuable assistance that we have to offer.

Border/Port Security Firearms Interdiction

Technology for inspection and interdiction operations is important, but not effective without the appropriately trained personnel. CBSI provides specific advanced training on techniques for intercepting smuggled narcotics, weapons and other contraband at ports of entry to the law enforcement and customs officers who will be responsible for this task.

For example, in the area of passenger screening, the United States is working to enhance the capacity of Caribbean nations to identify high risk travelers and execute coordinated interdiction operations utilizing the CARICOM Advance Passenger Information System (APIS) that was developed in partnership with DHS. CBSI funding supports a Customs and Border Patrol (CBP)-managed project to improve analysis and distribution of action data (from APIS) collected by the Joint Regional Communications Centre (JRCC) in Barbados, and related training to ensure that border authorities effectively react to actionable hits.

CBSI also supports UNODC’s Container Control Program, which includes the training of partner nation inter-agency container profiling units comprised of customs and other relevant law enforcement officials to detect, identify, and inspect high-risk containers using risk analysis and modern profiling techniques.

We will continue to provide assistance to improve tracking systems that help interdict illicit goods and to conduct joint surveillance operations and training among border security agencies to deter and prevent illicit trafficking.

In December 2012, the United States launched a $3.43 million assistance program to combat illicit trafficking in firearms as part of the Caribbean Basin Security Initiative (CBSI). As part of this program, the U.S. Department of State partnered with the U.S. Department of Justice’s Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) to spearhead this initiative comprised of the following agenda which will: 1) provide two Regional Firearms Advisors in the Caribbean to render on-site assistance; 2) establish a forensic training program; 3) provide expert legal, regulatory and parliamentary assistance; and 4) develop an exchange program that permits Caribbean law enforcement officials to work alongside ATF counterparts in the United States.

Anti-Corruption and Anti-Money Laundering

Regardless of the progress that we make in the anti-crime and security areas, we will not be successful in this fight unless we aggressively combat corruption, strengthen laws, and increase cooperative capacities to track the laundering of corrupt and criminal proceeds.

On anti-corruption, we must further encourage enforcement of laws implementing the obligations of the Inter-American Convention against Corruption and the United Nations Convention against Corruption, and to cooperate across borders to extradite corrupt officials and those who corrupt them as well as return the proceeds of corruption to their legitimate owners. The Jamaican Constabulary Force (JCF) has become a recent example of successful anti-corruption programs and can serve as a model for dealing with police corruption throughout the region. The JCF has conducted investigations that resulted in the dismissal of more than 300 police officers on charges of corruption since the initiative was launched in 2008. I am proud that CBSI was able to provide training and resources that helped the JCF to carry out their mission.

On fighting money laundering, each jurisdiction must enact legislation that fully criminalizes money laundering and terrorist financing in line with international standards. This action would not only bring all jurisdictions into compliance with the Financial Action Task Force (FATF) Recommendations, but also provide the foundation to support all regulatory and law enforcement actions.

We, too, must continue working together to strengthen national, regional, and international action against money laundering and support the Caribbean Financial Action Task Force (CFATF). We should expand cooperation on financial investigations of drug- trafficking and other transnational criminal organizations. We should expand training to enhance the capacity of investigators and prosecutors to prevent, detect, investigate, and prosecute money laundering, and to use effectively and transparently forfeited assets to build the domestic capacity of criminal justice systems in partner nations.

Working with the U.S. Department of Treasury’s Office of Technical Assistance, we are providing support for US Government experts to travel to the Caribbean to provide mentoring to law enforcement and judicial personnel in preparing financial crime cases for prosecution. In the Eastern Caribbean, we have provided computer equipment and specialized software for the Financial Intelligence Authorities in St. Lucia and Dominica. We are also working with the Department of Justice to provide legal advisors to enhance regional capacity to investigate and prosecute organized crime across the Caribbean including on asset forfeiture, money laundering, and financial corruption.

Demand Reduction, Crime Prevention and At-Youth-Risk Programs

We must break the cycle of youth, drugs, gangs and violence. In addition to law enforcement efforts, we must also invest in education, prevention, and training that gives youth hope beyond crime. High unemployment in the region makes youth more vulnerable to criminal elements. Education, job training and development of a marketable skill-set offer youth a strong incentive to be productive members of, and contribute to the development of, their communities. For those youth coming out of gangs or prisons, we must invest in rehabilitation and medical treatment to help them adjust out of a life of crime and contribute to their communities.

Programming in this area focuses on developing a sustainable approach to decreasing juvenile crime by targeting first-time offenders. The Department of State and USAID, through our Gang Resistance Education and Training (GREAT) and Community Development Programs, are working with Caribbean countries to design education and workforce development services for at-risk youth that provide an alternative to crime and other harmful behavior.

Separate programming supports drug demand reduction through the training of treatment and rehabilitation professionals. INL, through CBSI, is providing funds to OAS/CICAD to support drug demand reduction including the training and certification of drug abuse treatment personnel. As part of this project, it is estimated that a total of 70 service providers will be trained in the three participating pilot countries; Jamaica, The Bahamas, and Trinidad & Tobago.

Domestic Violence Strategies: Ending Gender-based Violence and Femicides

Let me also say a few words about domestic violence, which is also increasingly becoming a challenge in many jurisdictions in the Caribbean and further fracturing families and communities alike.

We must protect vulnerable members of our communities, especially women, from domestic violence. In too many parts of the world, women and young girls are physically or sexually abused. Some will experience rape, attempted rape, and be further tortured and murdered. This violence affects women’s health and well-being; it hurts children and families and poses considerable costs to societies – economically and socially, and it is simply unacceptable. This is not only a gender or economic issue, but a matter of human rights and national security. We need to put laws in place to criminalize such acts, and they must be implemented in order to hold people accountable and address impunity. We must continue to work to end domestic violence in all of our communities and harness the potential of all people to help build stronger communities.

Moving Forward: An Archipelago of Security and Net-Centric Partnerships

In closing, we all need to be more connected with each other in the Caribbean and across the hemisphere. In places where the UK, France or the Dutch governments have enhanced resources, perhaps they can take a more active lead in efforts to increase citizen security, including providing greater technical assistance to those partners that may express a need and to build capacity.

In this regard, we applaud Brigadier General Dick Swijgman and the Netherlands Forces in the Caribbean for their efforts and leadership in disrupting and dismantling drug-trafficking and illicit networks.

In places where the United States has a stronger security footprint, we will strive to take a greater role and work with partners to strengthen their capacity, including on assets seizure, extraditions, mutual legal assistance, and regional cooperation.

We must invest more in new partnerships against trafficking networks and continue building our own law enforcement networks and synchronizing threat detection systems to stem the tide of illegal drugs in our region.

I want to leave you with a few additional ideas that can help us to enhance further cooperation and strengthen these partnerships:

Enhance Information Sharing: To realize an “Archipelago of Security” partnership we must enhance information and intelligence sharing. A U.S. government funded project is assessing the feasibility of developing a web portal solution to enhance law enforcement training in the Caribbean by encouraging regional collaboration and information sharing on training content, techniques, best practices, and experiences.

Combating Corruption and Money Laundering: Combating impunity and corruption must be a priority because criminals thrive when they can penetrate and corrupt our government institutions. Anti-corruption policies should be integrated into all possible projects as a key element. We must also continue to track illicit financial flows. Working with the UK, the United States supports an Egmont/OAS-CICAD/FinCEN training to strengthen the capacities and authorities of the Caribbean Islands to conduct strategic analysis of collected financial data in their Financial Intelligence Units (FIUs) to track illicit financial flows. We too should explore and support a peer-to-peer network with Pacific Islands Forum jurisdictions to exchange best practices on security vulnerabilities common to the Atlantic and Pacific islands.

Link Peace and Security with Sustainable Development Efforts: We must do a better job at articulating the harms, impacts, and costs of crime and violence to communities in the Caribbean. We must dismantle organized criminal networks and gangs, disrupt today’s drug trade routes, and help our Caribbean partners turn their economies into the new markets and investments frontiers of tomorrow, and safeguard their human capital, national assets, and natural resources. We can only do this if we work together to stem the wave of crime, corruption, and violence and invest in economic development and job growth strategies to create economic opportunities for those communities impacted by unemployment, crime, and violence, including at-risk youth programs that offer a viable alternative to crime.

Collective Action and Public-Private Partnerships: We cannot realize our shared objectives without the active and continued engagement of the private sector. In this increasingly interconnected, networked world, we must go beyond government-to-government interactions and reach out people-to-people. Collective action—on the part of governments, the private sector, and civil society—is essential to achieve greater security, economic development, and prosperity.

While U.S. assistance can help advance Caribbean partner capacity to meet some of the security challenges they are facing, effective solutions will require a sustained commitment from all CBSI partners, as well as the assistance of other international donors.

It will take responsible governance and effective law enforcement actions, because permitting corruption, money laundering, and criminal activity to continue without consequences is not a viable option.

It will take education, training, and employment, because for the rule of law to take hold, societies must trust their government to safeguard public security and to nurture a sustainable future.

Finally, it will take enduring partnerships based on mutual respect and recognizing that when we all share the burden and build on our gains, challenges can be overcome.

Thank you.



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