Saturday, June 09, 2007

The Monzer's Ball

He was called the 'Prince of Marbella'. "The arms dealer spared no expense on the sprawling, gated property that overlooks Puerto Banus and boasts a lavish. 15-suite Renaissance-style palace and swimming pool shaped like a four-leaf clover." But the grandee had a darker side to him -- or a brighter side -- depending on your political point of view.

In one photo, he is shaking hands with the late Uday Hussein, the ruthless eldest son of dictator Saddam Hussein. Uday was killed by U.S. troops in July 2003. Another photo shows al Kassar holding hands with Hassan Aideed, son of a now-dead Somali warlord depicted in the movie "Black Hawk Down." In a third, he hugs terrorist Abu Abbas, the former leader of the Palestinian Liberation Front captured in Baghdad in 1993.

The LA Times reports that "Monzer Kassar of Marbella, Spain, and codefendants Tareq Mousa Ghazi and Luis Felipe Moreno Godoy were arrested Thursday as they prepared to complete a transaction to pay for the weapons, federal officials said."


Between February 2006 and May 2007, Kassar, Ghazi and Moreno agreed to sell thousands of machine guns, millions of rounds of ammunition, rocket-propelled grenade launchers and surface-to-air missile systems to the FARC, according to Michael J. Garcia, U.S. attorney for the Southern District of New York.

During a series of recorded telephone calls, e-mails and face-to-face meetings, the three men agreed to sell the weapons to two confidential sources working with the U.S. Drug Enforcement Administration, according to the indictment. The two men were posing as FARC militants who claimed they wanted the weapons to attack U.S. helicopters conducting anti-drug and anti-terrorism missions in Colombia, the indictment said.

The Washington Post adds, "the men had agreed to provide the weapons for the FARC "to use to protect their cocaine-trafficking business and to attack United States interests in Colombia. They knew the weapons they agreed to sell were destined for a terrorist organization. They knew the arms were going to be used to kill Americans," Garcia told a news conference.". International terrorism has been been forming alliances with organized crime for a long time. Interpol, in December 2000, before the WTC attacks noted:

Structural links between political terrorism and traditional criminal activity, such as drugs trafficking, armed robbery or extortion have come increasingly to the attention of law enforcement authorities, security agencies and political decision makers. There is a fairly accepted view in the international community that in recent years, direct state sponsorship has declined, therefore terrorists increasingly have to resort to other means of financing, including criminal activities, in order to raise funds. These activities have traditionally been drug trafficking, extortion/collection of "revolutionary taxes", armed robbery, and kidnappings.

The principal areas of concern at that time were: 1) Albanian Organized Crime Groups; 2) Links between Drug Trafficking and Terrorism in Central Asia; 3) Strategic Alliances and International Activities of Eastern-European Organized Crime; 4) The Colombian Nexus; 5) Russian and Israeli organized crime. One surprising area of criminal activity the Interpol identifies surrounds Cigarette Prohibition. Who knew? The Interpol report said:

Why are cigarettes such an attractive commodity for organized crime groups? First, the difference between the duty-free and duty-paid prices are substantial, thereby allowing smugglers to make profits at relatively low street prices. Second, they are very easy to handle and transport. For example, a container load of cigarettes carries a potential tax value of $1.2 million, almost all of which is potential profit for the smuggler. Third, cigarette smuggling requires a willing market and a good local distribution network, which have already been established by drug-trafficking organizations.

Despite considerable investments in anti-smuggling measures by law enforcement agencies, cigarette smuggling is flourishing around the world. In Europe, after the collapse of the Soviet Union, already existent smuggling trends in Italy and Spain served as a model for organized groups in other countries. Smuggling networks developed in the Balkans when international sanctions were imposed as a result of the war. In South Africa, there was a surge in cigarette smuggling after the collapse of apartheid and the lifting of international sanctions. In Colombia, well established drug routes were easily converted into cigarette-smuggling routes. Interstate cigarette smuggling is one of the fastest growing crimes in the United States, due to considerable differences in state tax rates. State taxes on cigarettes currently range between 2.5 cents to $1USD per pack. In Canada and Great Britain, extremely high cigarette taxes proved to provide the fertile ground needed for cigarette smuggling to flourish. Similar patterns continue to emerge around the world, while criminal activities continue to grow. In Colombia, cigarette smuggling is directly related to money laundering schemes through the so-called "black market peso exchange." During the exchange, drug-dealers convert U.S. dollars into clean pesos, while cigarette smugglers buy U.S. dollars in order to purchase international goods. The U.S. Treasury Department calls this system "the most dangerous and damaging form of money laundering ever encountered". In Italy, criminal organizations sign contracts with the tobacco companies and buy enormous quantities of cigarettes. Some criminal groups are so powerful, they demand that tobacco companies refrain from selling their products to other criminal organizations. In Germany, Vietnamese groups dominate the street sale of smuggled cigarettes. With time, they have evolved from unorganized individuals into highly sophisticated groups controlling the majority of illegal sales. Along with traditional methods, more elaborate techniques have evolved for cigarette smuggling into Germany. Non-existent corporations have been established to purchase duty-free cigarettes with the intention of exporting them to Eastern Europe. However, before the cargo reaches the border, it is sold to illegal wholesale dealers. In Britain, the port of Dover has become the center of smuggling activities, taking advantage of France’s lower tobacco taxes. Tobacco smuggling is a ruthlessly efficient and highly organized trade which involves some of Britain’s most vicious criminal gangs, as well as the Eastern European crime groups and the Italian Mafia. British police estimate that Italian organized criminal groups account for 15% of the illegal trade, while Eastern European gangs are responsible for 10% of the smuggled cigarettes in Great Britain. The ferocity of the competition is likely to contribute to violent confrontations as the gangs compete for control.

Salon argued that the War on Terror might be taking resources away from winning the War on Drugs. Maybe the two are not so different after all. A pundit remarked that the world has about as much chance of winning the War on Terror as winning the War on Drugs. If he's right then "only the dead have seen the end of war." Once upon a time war was about uniformed armies coming to grips on battlefields. This was the scenario upon which the Geneva Conventions were premised. Perhaps the face of war has changed beyond all recognition. The main challenge of the 21st century is to recognize it at all.

Interestingly enough, Monzer al-Kassar's name (the same man, different spelling) comes up in connection with the Spanish train bombings. The man was obviously well known to Western intelligence agencies and sometimes served as an arms representative for Western countries to "third countries". Barcepundit has details from Spanish newspaper translations in this 2005 post of Kassar's connecion with the Syrian underground in Spain, and there is at least a suggestion he was playing both sides of the street.

19 Comments:

Blogger A Jacksonian said...

And he comes up a few times in such places as the BCCI scandal and Iran/Contra... been looking at that.... not a nice man.

6/09/2007 05:32:00 PM  
Blogger Sparks fly said...

Lower the tax in the U.S. and the problem goes away, at least for us.

So the criminal activity is solidly based on a greedy government tax.

Think about it next time raising taxes on cigarettes shows up as a ballot measure.

6/10/2007 12:45:00 AM  
Blogger Troy said...

Besides the cig tax stuff.... war has gone horizontal and we are all on the frontlines it seems.

A "Warriors" like group of gangs and terrorist against decent society. Hmmm... Thanks for something to think about besides Paris!

6/10/2007 07:12:00 AM  
Blogger Boghie said...

Sparks Fly,

America is much safer when chase down Indian Reservation Cigarette smugglers (using the internet and FEDEX) and 'pat down' the grandmas and the infants at the airport.

Those tasks are easier than 'profiling' folks like Mr. Monzer. And, besides, he was part of the US government eighty years ago or something, eh...

The War, the Economy, the Culture are all horizontal. The World is Flat. California can no longer protect its borders from FARC like grandmas driving motor homes carrying twenty pounds of cigarettes from state sponsors of lung health terror. But, if we pull the troops from Iraq we can use them to attack motor homes and jihadis alike - after we repeal 'Posse Comitatus'.

6/10/2007 07:24:00 AM  
Blogger TigerHawk said...

Still, if high cigarette taxes have contributed to the secular decline in smoking rates in rich countries, then it is almost certainly true that the lives saved from those higher taxes overwhelm the lives lost to terrorism. That does not dispose of the question for numerous reasons, but for the bean-counters out there it is something to think about.

6/10/2007 08:11:00 AM  
Blogger EDH said...

The cigarette tax, like a CO2 or other "Pigouvian tax," is meant to optimize private behavior by incorporating the social cost of an activity in its private cost.

Could it be that Pigouvian taxes can create thier own, separate social costs?

6/10/2007 08:12:00 AM  
Blogger Pangloss said...

Of course we all remember the Hezbollah smugglers who bought cigarettes in South Carolina and sold them in Michigan. That case is about twelve years old. Daniel Pipes and The Mackinack Center have information. This Anti-Tobacco site even has an RSS feed about Hezbollah cigarette smuggling.

Not only is Hezbollah making money from cigarette smuggling, but also from smuggling fake Viagra. This of course makes you wonder if Hezbollah and other Jihadist gangs are making money from all types of computer spam.

6/10/2007 08:35:00 AM  
Blogger allen said...

Of course, had the government not entered the healthcare business in the first place...

6/10/2007 10:44:00 AM  
Blogger ricpic said...

sparks fly's comment at 12:45 is absolutely dead on target. You can thank our rapacious ever growing government for ever growing crime.

6/10/2007 11:41:00 AM  
Blogger Pickles said...

Don't forget counterfeit cigarettes, either, which most of the time are difficult to discern from the industry-produced ones.

6/10/2007 01:06:00 PM  
Blogger Karridine said...

"The betterment of the world can be accomplished through pure and goodly deeds, through commendable and seemly conduct."

*too simple, too simplistic!
*yeah, it works, but not fast enough!
*it works, but I hafta change ME!
*whaddayoo? Bill Whittle?
*personal responsibility? Aaaargh!

6/10/2007 05:04:00 PM  
Blogger R said...

I am having a coffee with Sigmund Freud and Plato. We discuss this issue. Imagine what they would say.

Just imagine. What's new Pussycat?

6/10/2007 05:18:00 PM  
Blogger chuck said...

In the summer of 1967 I was working nights at a NYC restaurant helping prepare the next day's meals. One of the truckers who came to the rear loading dock would take orders for cigarettes smuggled up from VA where they cost .25/pack. At that time the price in NYC was about $2.00/pack, so there was plenty of money to be made. I expect the same goes on today.

6/10/2007 06:50:00 PM  
Blogger jane said...

Time to update? SURGEON, ATTORNEY, AND UN SECRETARY GENERALS’ WARNING:

Smoking Causes Lung Cancer, Heart Disease, Emphysema, And Profiteering By Crime And Terrorist Syndicates And May Complicate Pregnancy and Efforts to Curb Money Laundering, Jihad, And Global Warming. It’s Yucky, Too.

My sister is a lawyer for a corp that supplies oil and mil infrastructure needs globally and has to deal with our laws regarding who will be the end-users of certain products. Her country of oversight is Brazil and from what I gather it isn't a simple task to ensure that proscribed items don't get into the wrong hands since buyers are often intermediaries who don't self-identify as merchants of death-to-America.

6/10/2007 09:10:00 PM  
Blogger Ymarsakar said...

I just read John RIngo's novel A Deeper Blue, and he specifically mentioned the cigarette smuggling due to Europe's high taxes on cigarettes.

To the extent that certain speedboats are now known as Cigarettes. With that many speedboats, customs becomes basically porous and impossible to 100% control. Or even 50% control, given Europe's decrease in naval assets.

6/11/2007 12:28:00 AM  
Blogger David M said...

Trackbacked by The Thunder Run - Web Reconnaissance for 06/11/2007
A short recon of what’s out there that might draw your attention.

6/11/2007 10:21:00 AM  
Blogger Troy said...

Even more rock solid proof... Eddie Murphy's Beverly Hills Cop opens with a scene where he's buying illicit cigs undercover! (he's hanging off the truck in a chase scene...)

6/11/2007 01:19:00 PM  
Blogger Ikez said...

Spain really needs to hand this guy over because as A Jacksonian has indicated he could be a wealth of information on terrorists, criminals, drug runners, etc.

12/26/2007 09:19:00 AM  
Blogger Xtraboy said...

;) Goog post!

2/07/2008 12:39:00 AM  

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