According to a recent assessment, drug trafficking in Chile has become increasingly prominent, diversified, and violent over the past year — mirroring public opinion polling that suggests Chileans are increasingly more worried about the threat posed by organized crime.
A report from Chile’s Drug Trafficking Observatory shows that seizures of Colombian-sourced “creepy” marijuana in Chile have skyrocketed by 700 percent in the past three years. Over the same time period, seizures of Paraguayan-sourced marijuana in Chile have plummeted by 900 percent. Meanwhile, cocaine seizures in the country have been on a downward trajectory since 2019.
The study also notes a substantial increase in the use of Chilean ports and maritime routes for drug trafficking, as well as a shift away from the traditional Paraguay-Bolivia-Chile trafficking axis towards routes running through Colombia, Ecuador, Peru and Chile.
Drug trafficking methods have evolved, too. According to the report, Chilean authorities discovered 15 clandestine drug production laboratories in 2019, primarily concentrated in and around Santiago and Antofagasta. The labs were largely dedicated to the production of synthetic drugs, playing to the consumer demand for a market that grew 680 percent between 2017 and 2019, according to Cooperativa.
Violence associated with drug trafficking has also increased, with groups tapping into a growing national arms market, according to the report. Police complaints involving drug-related homicides have risen from six in 2010 to 30 in 2019, though these incidents make up a small percentage of last year’s 28,000 drug-related complaints.
InSight Crime Analysis
The observatory’s results correlate with those of a June survey that found that 79 percent of Chileans and 69 percent of Chilean experts viewed drug trafficking and organized crime as a “crucial or significant threat to national security” — ahead of climate change, pandemics, and cyberattacks.
While drug trafficking trends in Chile are worsening, media and government fixation on the phenomenon has fostered disproportionate public anxiety when compared to the country’s actual levels of violence, Lucia Dammert, a public security expert at the University of Santiago, told InSight Crime.
What the report does highlight, she said, is that Chile’s drug consumption market is growing.
“When [a country] is considered a transit country, you can generate mechanisms solely focused on control to try to confront the problem,” Dammert said. “But we’re a consumer country, which requires more policies linked to health, as well as more policies related to police action and prevention at the local level.”
Across Latin America, narcotrafficking groups have had to expand and diversify their operations in order to maintain profits during the coronavirus pandemic, which has complicated the movement of drugs. In Chile, the uncertainty generated by the pandemic follows months of instability generated by widespread protests against the political establishment.
According to the report, Chilean narcotrafficking groups have pivoted towards moving “cheaper and more addictive drugs” in order to maintain a consistent profit line during the upheaval, recalling similar trends observed during Chile’s political crisis in the 1980s.
The report also indicates that Chilean drug trafficking is heavily localized. Nearly 91 percent of all drugs seized in 2019 were in Chile’s four northern-most administrative regions, closest to the Peruvian and Bolivian borders.
Dammert stressed that this concentration of drug markets makes the drug trafficking scene more prone to violence and fragmentation.
“If you look at the territories where drug trafficking is today, they’re the same as fifteen years ago,” Dammert said. “So you can’t say that the state doesn’t have the capacity [to fight it]. The state hasn’t had the vision to confront this in a more structural way.”
A powerful business tycoon jailed in the United States for laundering drug money may soon be a presidential candidate in Honduras following his release this month.
At least 14 lawmakers from the opposition Liberal Party are reportedly urging Yani Rosenthal to run for president when he returns to the Central America nation on August 7, according to Criterio. One of them, Juan Carlos Ávila, said they believe Rosenthal is the “only one” able to unite the political opposition ahead of the 2021 general election.
Rosenthal, a former politician and presidential candidate in 2009 and 2013, comes from one of Honduras’ most wealthy and politically-connected families. In July 2017, he pleaded guilty to laundering drug money for the notorious Cachiros criminal clan, for which he was handed a three-year prison term in the United States as part of a plea agreement.
As one US attorney put it, Rosenthal “moonlighted as a money launderer for a ruthlessly violent drug trafficking organization.”
The Rosenthal family has longstanding connections to both politics and organized crime.
Yani’s father, Jaime, had established the family’s relationship with criminal groups long before he died in 2019. Himself a former vice president and major business figure, Jaime sold cattle and land to “clients” such as the Cachiros’ Rivera Maradiaga family, which were purchased with drug proceeds, according to documents included in the US drug trafficking trial of Juan Antonio “Tony” Hernández, the former congressman and brother of President Juan Orlando Hernández.
Yani’s cousin, former investment minister Yankel Rosenthal, also admitted in 2017 to having helped drug traffickers launder money through the “purchase of US real estate, political contributions in Honduras, and even investment in a professional soccer team,” according to the Justice Department.
The US Treasury Department’s Office of Foreign Assets Control (OFAC) sanctioned all three Rosenthal men in 2015 and added them to the agency’s list of “Specially Designated Narcotics Traffickers.”
InSight Crime Analysis
Latin America is rife with cases that show how political elites are interconnected with organized crime. The current political landscape in Honduras may be the most flagrant example today.
The sitting president, Juan Orlando Hernández of the National Party, has ties to corruption networks and is an alleged co-conspirator in an international drug trafficking conspiracy directed by his brother, which included the Cachiros.
What’s more, the National Party’s likely pick to succeed Hernández, Mauricio Oliva Herrera, has also been tied to the Cachiros through a number of properties he allegedly acquired from a shady business associate.
Before President Hernández took office, the National Party’s Porfirio “Pepe” Lobo allegedly handed out state contracts to Cachiros members during his time as president. In addition, his son, Fabio Lobo, was hit with a 24-year prison sentence in 2017 for the “huge quantities” of cocaine he trafficked alongside the Cachiros, all while using his father’s political connections for protection.
Yet, the opposition Liberal Party seems committed to rallying support behind a man who has openly admitted to laundering drug money for the Cachiros, one of the country’s most infamous crime groups.
Whether or not Yani ends up running, the fact that he has secured the backing of over a dozen lawmakers before even returning to the country after having been jailed is damning evidence of the depth of narco-politics in Honduras.
A Honduras court has ended the prosecution of nearly two dozen people — including government officials — accused in the Pandora case, a vast corruption scheme that saw $12 million in public money embezzled for political ends. The court’s decision deals a final blow to Honduras’ already embattled anti-corruption efforts.
The country’s judiciary made an August 4announcement that a special appeals court had dismissed criminal proceedings against 22 of 26 people. Attorney General Óscar Chinchilla called the decision in the case “unacceptable” in a post on Twitter, and the Attorney General’s Office immediately said it would appeal the decision.
The investigation into the Pandora case began in 2016 after an audit from Honduras’ Superior Accounts Tribunal (Tribunal Superior de Cuentas — TSC) found that public funds from the Ministry of Agriculture had been sent to private accounts.
The audit sparked a far-reaching probe by the Attorney General’s Office — with investigative support of the now-defunct Mission Against Corruption and Impunity in Honduras (Misión de Apoyo contra la Corrupción y la Impunidad en Honduras – MACCIH), an anti-corruption body backed by the Organization of American States. The inquiry found that 282 million lempiras (around $11.7 million) destined for agricultural projects had been diverted to various foundations and non-governmental organizations.
Prosecutors said a portion of those funds then went to finance electoral campaigns for Honduras’ two main political parties, the Liberal and National parties, including the winning campaign of President Juan Orlando Hernández in 2013.
The accused who had their cases dismissed include five current congressmen, a former mayor, a former governor, and the ex-husband of the president’s late sister.
InSight Crime Analysis
The unraveling of the Pandora case appears to be the final nail in the coffin for Honduras’ fight against graft, which had already been severely weakened with the dismantling of MACCIH last January.
After MACCIH, the Special Prosecutor’s Unit Against Corruption (Unidad Fiscal Especializada contra la Corrupción – UFERCO), which investigated the Pandora case, became the only institution in Honduras able to lead complex corruption investigations into political and business elites. But the unit has been increasingly hampered by a lack of resources and legal hurdles.
Earlier this year, one UFERCO official told InSight Crime the unit had received cuts to its budget and personnel.
Honduran politicians have also regularly sought to diminish the power and independence of anti-corruption institutions like UFERCO through changing the country’s criminal code to reduce sentences for corruption and drug trafficking cases.
The Pandora case had long stagnated before the dismissals. The investigation was frozen for several months after a protracted judicial reform of Honduras’ accounting office made it impossible for the Attorney General’s Office to keep moving it forward.
One prosecutor close to the Pandora case told InSight Crime in 2019 that the reform had been designed to “kill” large-scale corruption cases like this one.
President Hernández initially voiced support for the Pandora case, but that soon rang hollow. Named in court documents is the president’s late sister, Hilda, who allegedly “signed contracts with providers who later, even in the same day, paid with checks” from nonprofits alleged to have received embezzled funds, according to a Univisión investigation. Hilda Hernández also allegedly directed others how to spend the money, Univisión reported.
A Honduran prosecutor involved in the Pandora case, who asked to remain anonymous for security reasons, confirmed to InSight Crime the suspicions surrounding Hilda Hernández, who died in 2017 in a helicopter crash.
The Pandora case had been considered a shining achievement for the Attorney General’s Office, marking the first time in Honduras that a corruption investigation threatened to bring down influential politicians, including some close to President Hernández. Now only the narrow chance of appeal will save it.
The detention and investigation of former Colombia President Álvaro Uribe Vélez, a powerhouse in Colombian politics long alleged to have ties to paramilitary groups, leaves him to defend not only his legacy but also possible future charges.
Colombia’s Supreme Court ordered Uribe, who was president from 2002 to 2010, to be placed under house arrest while it continues to investigate allegations he was involved in witness tampering, procedural fraud and bribery, according to a news release from the court on August 4.
The Supreme Court’s investigation into Uribe, who is currently a senator, began in 2018 when it deemed credible evidence that he may have tampered with witnesses who accused him of creating paramilitary groups with his brother, Santiago Uribe.
While the Supreme Court has not brought formal criminal charges against Uribe, the Colombian justice system allows him to be detained as the investigation continues.
“The privation of my liberty causes me profound sadness for my wife, for my family, and for Colombians who still believe that I have done something good for the country,” Uribe wrote on Twitter before the court published its decision.
On August 6, one of Uribe’s lawyers, Diego Cadena, was also placed under house arrest amid allegations he personally tried to convince a witness to testify in the former president’s favor. In October 2019, the Supreme Court ordered Uribe to a hearing in which they interrogated him for hours.
The allegations against Uribe stem from his complaint that the Supreme Court investigate his main political adversary, Senator Iván Cepeda, for the same charge he now faces: witness tampering. Cepeda had addressed Colombia’s Senate in September 2014 and accused the former president of having ties to paramilitary groups.
After a lengthy investigation that reviewed witness testimony from both sides, video and recordings of intercepted phone calls, the Supreme Court determined that Uribe — through the use of third parties — had pressured paramilitary witnesses to withdraw or change their testimony.
The announcement of Uribe’s detention has sent shockwaves through Colombia, with his supporters marching and lining up in caravans along main thoroughfares in the cities of Medellín and Barranquilla, Semana reported.
InSight Crime Analysis
While Uribe has managed to elude a formal criminal indictment for his alleged links to paramilitary groups — even while close allies and family members have been convicted of similar crimes — the Supreme Court’s investigation takes a different approach, in that it’s not so much about his past acts but current accusations of obstruction of justice.
The former president, his family members, and some of his closest associates have found themselves the subject of journalistic investigations and accusations that they aided and financed illegal right-wing paramilitaries in the 1990s.
The groups, which ultimately came under the banner of the United Self-Defense Forces of Colombia (Autodefensas Unidas de Colombia – AUC), served as the government’s proxies in a parallel war against the country’s leftist guerrillas and suspected collaborators. While maintaining ties to drug trafficking groups, the paramilitaries committed massacres and terrorized the civilian population, at times displacing entire villages.
Uribe has also come under scrutiny by Colombia’s Supreme Court in the past. In 2010, the high court opened an investigation into an extensive illegal wiretapping network targeting journalists, rival politicians and human rights defenders while he was president. The head of the country’s intelligence agency at that time was sentenced in 2015 to 14 years in prison for the illegal spying.
The latest investigation against Uribe may hinge on the testimony of Carlos Enrique Vélez, a former paramilitary leader known as alias “Comandante Víctor.” After originally stating that Iván Cepeda visited him in prison to get him to incriminate Uribe, Vélez changed his story and revealed that Uribe’s lawyers had paid him to lie about Cepeda.
In an interview with Semana in late July, Vélez stated that Uribe’s lawyers, including Cadena, had paid him 40 million pesos (some $10,500) to lie about Cepeda and persuade other former paramilitary members to do the same.
At first, Cadena said that the money given to witnesses, including Vélez, had been to help them financially through difficult times, adding that the former president had not been aware of these payments.
However, a different version has now been put forward. In late July, Uribe’s defense team stated that Cadena had been extorted by Vélez and had not revealed the truth, due to his involvement in the Uribe investigation.
As part of its broader investigation, the Supreme Court is now considering both allegations about the payments and will soon hear new evidence about Uribe’s involvement.
In the meantime, Uribe will remain in a position that he had long hoped to avoid: under arrest.
The arrest of Santa Rosa de Lima Cartel boss, “El Marro,” was welcomed by Mexico’s President Andrés Manuel López Obrador, who was in need of a security win. But this capture threatens to undo the progress made against oil theft and may not quell violence in the country’s most violent state for long.
Originally made up of Guanajuato oil thieves who banded together in order to resist the encroachment of the Jalisco Cartel New Generation (Cartel Jalisco Nueva Generación — CJNG), the Santa Rosa de Lima Cartel (CSRL) is somewhat of an outlier in Mexico’s criminal landscape.
Over the last decade, many of Mexico’s larger, more diversified criminal groups, such as the Zetas, the Gulf Cartel or La Familia Michoacana, fragmented into smaller groups vying for control of lesser slices of the criminal pie and contributing to soaring homicide numbers.
The CSRL was arguably the first group to re-establish enough control over a particular area to fight back against a larger, more powerful threat like the CJNG. It did so by relying on two elements: a hyper-localized power base and an unerring focus on oil theft.
The Santa Rosa de Lima Cartel Today and Tomorrow
The CSRL took the name of Santa Rosa de Lima from a town of a few thousand people where Yépez Ortiz was born. It cemented its control over key municipalities such as Celaya, Apaseo el Alto and Apaseo el Grande, all of which offered ready access to oil pipelines.
Despite incursions from the CJNG and repeated government operations, the CSRL retained this local focus. It did enter some smaller-scale operations in the neighboring states of Querétaro and Hidalgo, while also turning to extortion to diversify its sources of revenue.
And while the CJNG is likely to try and rapidly claim these municipalities amid a power vacuum, it is uncertain if the capture of Yépez Ortiz will end the CSRL altogether.
According to El Universal, his father and brother are already vying to lead the group while threatening messages seeking revenge have circulated on social media, claiming to be from the CSRL.
But for Eduardo Guerrero, a security specialist at Lantia Consultores, they are unlikely to succeed. “El Marro was a very skillful, elusive and strategic leader and it seems to me that his replacements — who will certainly be relatives — don’t have the skills he had to keep this organization afloat,” he told the Guardian, adding that the cartel would likely splinter into smaller groups.
No Honor Among Oil Thieves
Early on in his presidency, López Obrador made reining in rampant oil theft a major national security priority. Security forces were deployed to watch over oil installations, a number of important pipelines were closed and alternate means of transporting gasoline were needed as various parts of the country ran out of fuel.
In the strictest sense, this plan appears to have worked. The amount of oil stolen fell sharply in 2019 although the total number of oil theft attempts rose slightly. And Mexico’s national oil company, Petróleos Mexicanos (Pemex), recently reported that oil theft in Guanajuato had dropped by 96 percent in the first half of 2020 compared with 2018.
The trade-off has been that violence in Guanajuato has exploded, as the CSRL and CJNG battled both each other and government forces. The state was Mexico’s most murderous in 2019 and so far in the first half of 2020.
And progress against oil theft may be all too temporary as the gangs have evolved their techniques. Despite the aforementioned drops in oil theft, theft of liquid petroleum gas has soared in the last year. According to the BBC, the CSRL has taken an active part in gas theft as well as oil theft.
With more scrutiny of oil infrastructure above ground, oil thieves have also been trying to hide their handiwork. In June, the Mexican army reported finding underground hoses moving stolen oil from pipelines in the states of Guanajuato, Hidalgo, Nuevo León and Puebla.
While the government’s focus on the CSRL stripped the group of much of their oil theft revenue, its members are experienced oil thieves who are likely to continue targeting pipelines whether the group remains intact or not. At their height, the CSRL was reportedly extracting millions of liters of oil a month. That kind of expertise does not just go away.
The Future of Guanajuato
Yépez Ortiz was an important contributing factor to the rise in violence in Guanajuato in recent years.
According to La Silla Rota, hitmen who murdered 26 people at a rehabilitation center in the town of Irapuato in July 2020 identified themselves as having been sent by El Marro. In 2017, a potential alliance with the CJNG quickly fell apart after Yépez Ortiz allegedly murdered two of the rival cartel’s emissaries, Mexican security expert David Saucedo told Aristegui Noticias.
His arrest may make a short-term difference in the state, but the dynamics that underpin violence in Guanajuato do not revolve around just one man. While the violence in the state initially rose due to the lure of oil theft, other criminal economies now also play a major part.
Large doses of drugs have been seized in the state in transport north to the United States. Reports of extortion have soared. In 2018, the overwhelmed police force in the town of Irapuato stated it would no longer fight against oil theft or drug trafficking, stating that too many of their own were dying.
It is uncertain how long any grace period granted by Yépez Ortiz’s arrest will last, or whether it will happen at all.
Top photo: courtesy of the Attorney General’s Office of Guanajuato
Food trucked into Venezuela from Brazil under a law allowing it to be transported for humanitarian needs is being diverted to Venezuela’s black market.
On June 30, Brazil renewed a decree, first passed in March, barring people from entering the country from Venezuela due to the coronavirus pandemic. However, the decree makes an exception for trucks crossing for “humanitarian reasons,” an excuse which food distributors in Venezuela have used to buy Brazilian products to sell in Venezuela at inflated prices.
In July, El Pitazo reported that foods and other items were being bought in Brazil and sold on the black market in Venezuela.
Officials and residents in the town of Santa Elena de Uairén — in the Venezuelan state of Bolívar just 16 kilometers from the Brazilian border — told InSight Crime that dozens of trucks cross the border each day carrying food from Brazil. The products include staples like rice, powdered milk, coffee, sugar and butter. Sausages, cooking oil, mustard, jam and canned goods have also been transported.
A town official, who asked to remain anonymous for fear of reprisals, said most items are sold for about three times their original prices.
“While a kilogram of rice costs 60 cents in Brazil, it’s sold for $2 in Santa Elena de Uairén,” the official said.
Additionally, drivers are allegedly bribing border officials to bring across tobacco and fuel, items that are not covered by the decree but easily sold on the black market. Despite Venezuela having the world’s largest proven oil reserves, its economic collapse has seen gasoline being smuggled in from neighboring countries.
A liter of gasoline currently costs less than $1 in Brazil but sells at between $6 to $7 per liter in Santa Elena de Uairén, residents told InSight Crime.
Border authorities are also reportedly trying to take a cut of this lucrative contraband trade. According to El Pitazo, Bolivarian National Guard (Guardia Nacional Bolivariana – GNB) members at a checkpoint on a major road near Santa Elena de Uairén are administering coronavirus tests to truck drivers, telling them they tested positive and forcing them to pay $100 each in exchange for a guaranteed negative result.
InSight Crime Analysis
With Venezuela suffering food shortages from the one-two punch of an economic tailspin and the coronavirus pandemic, a lucrative black market trade in goods is thriving as people starve.
The decree was meant to allow Venezuelans to have access to food from Brazil, but it has mainly favored government authorities, vendors with links to officials and members of the Bolivarian National Guard, Ricardo Delgado, former mayor of the Venezuelan municipality of Gran Sabana on the Brazilian border, told InSight Crime.
According to Delgado, a large proportion of the food doesn’t even make it to everyday Venezuelans. “A lot of the items are transported strategically, for example, to mining areas of Bolívar state to ensure that illegal mining can continue,” he told InSight Crime.
Worse, this black market directly fuels other criminal economies in the region. “Buying food in Brazil is allowed but it’s often being paid for with (illegally mined gold). So it also leads to Venezuelan gold being smuggled into Brazil,” Delgado said.
Brazilian officials in the municipality of Pacaraima, on the border with Venezuela, told InSight Crime that they have taken no action to stop these schemes.
“What happens on the Venezuelan side is not the Brazilian government’s problem,” said one official, who spoke on condition of anonymity because he was not authorized to speak on the matter.
Explosive accusations by US prosecutors that three former top Mexican security officials accepted millions of dollars in bribes from the Sinaloa Cartel serve as damning evidence that the US-backed drug war relies on proxies with dangerous ties.
Genaro García Luna, Mexico’s Secretary of Public Security from 2006 to 2012, is charged with “engaging in a continuing criminal enterprise” and drug trafficking, according to a superseding indictment filed on July 30.
The former top security official “betrayed those he was sworn to protect by accepting bribes from members of the Sinaloa Cartel,” prosecutor Seth DuCharme said in a July 30 Justice Department press release. On at least two occasions, Sinaloa Cartel members “personally delivered bribe payments” to García Luna in briefcases containing millions of dollars, according to the news release.
Two high-ranking officers who served under García Luna — Luis Cárdenas Palomino and Ramón Pequeño García — were also indicted on drug trafficking charges.
Between 2001 and 2012, the three officials served the cartel by “agreeing not to interfere” with its multi-ton drug shipments. They also gave the group access to “sensitive law enforcement information” and put “other corrupt officials in positions of power” in areas the group controlled, according to the indictment.
In addition to the criminal enterprise charge — the same one former Sinaloa Cartel capo Joaquín “El Chapo” Guzmán was sentenced to life in prison for — García Luna is accused of aiding the Sinaloa Cartel’s trafficking of six cocaine shipments totaling about 50,000 kilograms into the United States between 2002 and 2007, according to the indictment.
García Luna was arrested in December 2019 in the state of Texas, but Cárdenas Palomino and Pequeño García have not yet been apprehended. If convicted, the former security secretary faces a sentence of between 20 years and life in prison. The other two officers face between 10 years and life in prison.
InSight Crime Analysis
The charges against three top security officials during the administration of former President Felipe Calderón put them on the payroll of the Sinaloa Cartel at the same time they were meant to lead US-backed anti-drug efforts.
Under García Luna, Cárdenas Palomino acted as the federal police’s director of regional operations between 2006 and 2012. Pequeño García headed the federal police’s anti-narcotics division that oversaw the Sensitive Investigative Unit (SIU), which had been specially vetted by the US Drug Enforcement Administration (DEA), according to a ProPublica report.
However, the vetting did not apply to the top leadership of the unit, which long had a reputation for leaking privileged information to Mexico’s criminal groups. Two groundbreaking investigations from ProPublica journalist Ginger Thompson in 2017uncovered how the murderous Zetas had access to such information.
In April 2010, the Zetas kidnapped and later presumably killed four individuals at a Holiday Inn in the northern business hub of Monterrey. ProPublica reported that an undercover surveillance operation the DEA and SIU had been running out of the hotel to track the regional Zetas boss at that time, Héctor Raúl Luna, alias “El Tori,” had been compromised.
When El Tori learned of the sting, he sent gunmen to the hotel. The agents quickly evacuated the area, and four hotel guests — along with a receptionist — were kidnapped. US officials did not assist in the subsequent investigation into the disappearances, according to ProPublica.
Less than a year later, in March 2011, Zetas gunmen stormed the city of Allende near the US-Mexico border. They kidnapped and massacred dozens of men, women and children as they searched for the informants cooperating with the DEA, according to ProPublica’s investigation.
It’s unclear how, but information sent from the DEA to the SIU was leaked to the Zetas, sparking the violent manhunt. Cárdenas Palomino and Pequeño García have not been linked to these massacres, but the charges against them highlight a worrying lack of oversight for such officers.
One former SIU commander, Iván Reyes Arzate, turned himself in to US authorities in 2017 after he was accused of filtering information to criminal groups the DEA was investigating. He was later also charged in connection to a drug trafficking conspiracy.
“Clearly the United States had to have known that something was profoundly rotten or really suspicious when the top leadership of the SIU was not willing to be vetted,” Vanda Felbab-Brown, a senior fellow at the Brookings Institution, told InSight Crime. “There must have been an awareness of the potentially huge risk for problems, but a decision was made that whatever intelligence was coming through was worth it.”
Authorities in Argentina have implicated police and prosecutors in an illegal gambling ring linked to the infamous Los Monos crime group, underscoring how the coronavirus pandemic has provided yet more opportunity for official corruption.
Five people were charged on July 23 in connection to the illegal ring, which operated several illegal gambling houses in the city of Rosario under the direction of imprisoned Monos leader Ariel Máximo Cantero, alias “Guille,” Rosario Plus reported.
Among those accused are former police chief Alejandro Torrisi, who was arrested exiting an illegal casino with an envelope of cash in hand. He allegedly helped get imprisoned gang members released while also managing some of the gambling houses, according to La Capital.
In March, Argentina shuttered its legal casinos as part of the coronavirus lockdown, a move that appears to have driven gamblers to seek illicit alternatives, according to Argentina’s State Lottery Association (Asociación de Loterías Estatales — ALEA).
Guille allegedly sent members of the group to extort both legal and illegal businesses in Rosario. The funds obtained were then invested back into the gambling houses, which operated with the help of official corruption.
“We started to see evidence that this group had possibly taken over this business through extortion and with [the help of] former police officers. … We are facing a huge problem,” Santa Fe’s Security Secretary Marcelo Sain told local media.
The recent revelations stem from an ongoing investigation into a January shooting at Rosario’s City Center Casino allegedly carried out by Los Monos member Maximiliano Díaz, alias “Cachete,” who was also charged in the illegal gambling and extortion case. Authorities believe the shooting at the city’s largest casino is linked to the gang’s extortion activities, according to Clarín.
InSight Crime Analysis
With local legal casinos closed as part of restrictions placed on businesses to try and curtail the spread of the virus, illegal gambling houses operated in part by Los Monos are growing increasingly popular.
Illegal gambling is big business in Argentina. In 2016, it was estimated to generate about 50 billion pesos per year (nearly $3 billion) in Buenos Aires Province alone. That same year, new laws imposed harsher penalties on those running illegal gambling operations and authorities began raiding clandestine casinos throughout the country. But now that legal means of gambling remain closed, illegal gambling is once again thriving.
“Without legal gambling, clandestine gambling is growing. For example, without lotteries in Argentina, illegal gambling has been working with betting in Montevideo [the capital of Uruguay], which hasn’t stopped … and with the easing of quarantine rules, the so-called gambling dens will continue to operate,” Ariel Fassione, secretary of Argentina’s union of gambling workers, told La Nación in May.
Official corruption in Rosario has only helped. The city’s police are notoriously underpaid and often involved in drug trafficking and other types of organized crime. In 2018, nine police officers were convicted for being part of Los Monos. The following year, six more police officers, including Santa Fe’s federal police chief, were charged with drug trafficking.
That said, the latest operation against the illegal extortion and gambling ring comes at a time when authorities are actively attempting to clean up the police force.
When Sain took office last December, La Nación reported he led a “purge” of the province’s police force, firing all 31 local police chiefs. Now, he is spearheading a set of security reforms meant to reorganize and professionalize the police, as well as establish an inspector general and disciplinary tribunal.
The fall in heroin prices in the United States and the devastating economic effect this has had on poppy-growing communities in Mexico has been widely discussed and often attributed to the rise of cheaper chemical alternatives, such as fentanyl.
But a new international research project believes the real problems and eventual solutions to this crisis lie much deeper. Romain Le Cour Grandmaison and Cecilia Farfán-Méndez from Noria Research are spearheading the Mexico Opium Network, launched in July 2020, which aims to provide a complete, data-driven panorama of Mexico’s opium economy to then help guide public debate.
InSight Crime sat down with the two researchers to discuss just how complex and misunderstood the dynamics driving Mexico’s struggling opium economy really are.
InSight Crime (IC): In 2019, Noria Research looked into the opium economy in Mexico today and the pressures it came under due to the rise in fentanyl use in the United States. A year on, you have launched the Mexico Opium Network. What factors have led to the creation of this research project and why is it needed today?
Romain Le Cour (RLC): In 2019, we published a report on what we call the “opium crisis” in Mexico, meaning the economic crisis of the production of opium and heroin. We had been documenting this through fieldwork. We wanted to provide a dose of reality to the huge economic figures usually associated with the discussion of illegal drugs.
We hear about opium in Mexico in terms of drug trafficking, violence and internal security. We don’t hear much about the social, economic and political realities of the regions that live from the opium economy.
There has been an evolution in the opium economy, going from a highly profitable era for 15-20 years where prices reached their highest peak. Those prices have now gone down. What we documented last year was that the evolution of this opium economy was not really well known in Mexico.
The Mexico Opium Network is meant to fill this gap. We don’t know enough about what is going on in these rural, marginalized areas of Mexico. And that means we are less able to propose any possible policy solutions.
IC: Why do you think public policies to address a reduction in opium crops or to reduce violence linked to this crop have failed in Mexico? Why can the Network succeed where others have failed?
RLC: The actions taken by public authorities towards opium production in Mexico have never really changed. From the 1930s to now, the priority has always been the suppression of crops. The response has been militarized, accompanied by destruction and fumigation campaigns.
But these actions were never intended to destroy the opium economy altogether. It is too important for the survival of these regions. The opium economy does not only maintain drug traffickers and farmers. It sustains the local economy and serves a political system, which relies on it to gain money and to govern these regions in Mexico.
The objective was never to reduce violence. Violence is not an obstacle to political power in Mexico. Therefore, governments, including the current one, criminalize farmers and eradicate the poppies. But without proposing real economic, social and political situations, the opium economy will remain as it is fueled by foreign demand, mostly in the United States.
We need to study these questions through cultural, economic, political and social-political lenses. This is what Noria Research and the Mexico Opium Network want to achieve. We are not looking for the silver bullet in terms of public policy. We want to produce robust, evidence-based knowledge on the state of the opium economy in the states of Guerrero, Nayarit, Sinaloa, Chihuahua and Durango.
Cecilia Farfán-Méndez (CFM):Public policies need to be evidence-based. One of the key functions of the network is to produce information that can help guide policy decisions. As occurs in other parts of the world, the decision to grow opium is not solely based on prices. We need to understand what factors incentivize a given farmer to enter the opium economy. Until we have this information, data on crop destruction will provide an incomplete picture.
IC: What are the major challenges facing the development of alternative economic strategies for rural communities depending on opium production?
RLC: Crop substitution programs have shown results around the world but they can often be used as a simple solution to a complex issue. Farmers have told us that they have specialized in farming only opium for over 20 years.
You once had people who grew legal crops such as coffee, maize or melon in certain areas but then specialized in opium poppy because it was more profitable.
The younger generation has only ever worked in opium poppy production. It’s hard for them to think about growing something else. The knowledge has disappeared. That’s the first big challenge.
The second challenge is that fumigation and eradication policies have involved tremendous use of chemicals. And then farmers have used even stronger fertilizers and chemicals in turn to counter the impact of fumigation and eradication. The ecological effect of this has been catastrophic. The land has been contaminated by all this.
And real alternatives cannot be provided without support from public authorities, which is another problem. Some of these isolated areas have only been more marginalized by state policies like militarization. You need to reintegrate them into formal economies through public investment and providing alternatives. This could be facilitated by the fact that opium poppy is currently not as profitable as before. If the state had the political will to go in and offer solutions, now would be the time to do so. But we don’t see that political will.
CFM: Development strategies cannot be a one-size-fits-all approach. An area of focus for the network is to better understand female participation in the opium economy. In Mexico, 15.2 percent of families who depend on the agriculture and fishing industries have a woman as the head of the household. By learning what other tasks they perform [such as household tasks and dependent care], it will be possible to also design development strategies that keep these women in mind.
Cautionary tales abound, however, such as monocropping not being a viable alternative.
IC: The Mexico Opium Network states that what is known about the social dynamics of opium production has been a result of local media coverage. Why do you think these dynamics have not received the same attention internationally as, for example, the dynamics of coca production in Colombia?
RLC: We have very good media coverage and academic research into opium poppy dynamics in Mexico. But there is no systematic data about the structural parameters of the opium economy within the different regions of production. We don’t have reliable data, we don’t have historical perspectives on what’s going in specific regions and the social, cultural, economic and political dynamics embedded in the opium economy.
One of the main objectives of the Mexico Opium Network is to first gather the information we already have, systematize it and produce much more robust evidence-based knowledge to make comparisons with other countries that grow poppy, such as Colombia, Myanmar and Afghanistan.
IC: The United States’ strategy against cocaine has been to finance coca eradication campaigns, despite significant evidence of human rights abuses and real doubts about their effectiveness. How do you compare this to the pressure it has placed on Mexico about poppy?
RLC: The US strategy in Mexico has been the same as in other countries. There has been significant pressure on Mexico to eradicate poppy. There has been political and economic pressure as well as material support for eradication and cooperation in locating the crops.
This pressure to eradicate illicit crops has existed for decades and it doesn’t work. There is more illicit crop production anywhere you look.
Again, the model is not based on making these economies disappear, it’s based on pushing the war on drugs. If these economies disappeared, the war on drugs would disappear. That’s not the objective.
Everyone knows where the poppy fields are in Mexico and how the poppy is being transformed into heroin. There is no political will to fully eradicate this illicit economy.
CFM: I don’t think this is the entire explanation, but historically, there are precedents of eradication campaigns in Mexico that have had negative consequences for drug users in the United States. Furthermore, I wouldn’t state that heroin per se has been the threat so much as contaminated heroin with other synthetic drugs such as fentanyl and fentanyl analogues. Eradication, therefore, wouldn’t eliminate the problem.
IC: Fentanyl and the popularity of chemical drugs has played a part in the drop in opium prices, but isn’t it overly simplistic to view this as the only reason behind this drop?
RLC: The opium economy in Mexico is more fragile than before and chemical drugs are a major reason why. But they are not the only factor. There has also been significant overproduction in Mexico in recent years.
It has been widely reported that chemical drugs will replace natural drugs but I’m not sure it’s a zero-sum game. It’s a question of cohabitation between natural and chemical drug production, they are affected by a complicated market which is always evolving.
The Mexico Opium Network wants to document these variations in illicit economies. We know so little about it, but we want to go beyond the oversimplified narrative of chemical drugs replacing natural drugs. It’s too early to say that.
CFM: Markets for drugs are more complex than just cost reductions on the supply side. While we may see a rise in other synthetic drugs, I do not believe heroin will fully go away. There is a consumer side we do not fully understand, and this is just as relevant to price differentials as how cost changes due to the production of synthetics.
IC: The current Mexican government has claimed to be pushing initiatives to try and provide economic alternatives for poppy growers in Guerrero. Is there any evidence that these can make a difference?
RLC: The current Mexican government has made such claims in Guerrero and other parts of the country. But we haven’t seen them.
On the contrary, these communities are highly economically and socially marginalized, it’s been that way for decades and it hasn’t changed with the current administration.
Right now, we can’t say the government is changing anything in those areas. The COVID-19 crisis has exacerbated these dynamics. These regions are incredibly isolated and so far from the state’s reach. The presence of the state there can usually be seen through teachers and soldiers, and that hasn’t changed. We haven’t seen a plan that would really affect these criminal economies, just more militarization.
IC: The opium economy has been a major source of income for criminal groups in areas like Tierra Caliente, Guerrero, but as it dries up, they are likely to turn to other forms of income. What reaction have you witnessed from these groups adapting as heroin income dips?
RLC: In Tierra Caliente, you may have other economies like drug trafficking, but this project wants to go beyond Tierra Caliente. In Guerrero alone, you have so many realities outside Tierra Caliente, you have so many realities between Sinaloa, Chihuahua, Durango and Nayarit. We have to go inside those different realities to understand the political economies of opium production in Mexico. It goes beyond criminal groups and the “narco-narratives.”
The opium economy in Mexico is based on political power and control. Criminal groups will suffer from the economic crisis of opium production but the impact on the political power will be far wider and more complex. Criminals are not autonomous from political power, it’s never the case. It’s not that a criminal group will just move from drug trafficking to extortion. If a group is moving into extortion, it’s because it has the political protection to do so. The interaction between the legal and illegal worlds at that level is very interesting. We need to understand those relationships.
IC: And while this is very early days for the Mexico Opium Network, do you have an understanding of how much poppy cultivation is needed to sustain fentanyl, which is being produced and then cut with heroin?
RLC: The Mexico Opium Network wants to connect opium production in Mexico with consumption in Mexico and the United States. We want to carry out an investigation on the production side in Mexico, including trafficking, and do the same on the consumption side in the United States. We want to achieve a level of collaboration with researchers and analysts on consumption and trafficking in the United States. Through these connections, we’ll be able to fully connect the dots.
We talk so much about the opium economy, but we actually know so little about it.
*This interview has been edited for brevity and clarity.
Recent incursions by the ELN to set up illegal mining facilities along the Caura River in central Venezuela are being seen as a threat by local Indigenous communities.
In mid-July, opposition lawmaker Américo de Grazia wrote on Twitter that a group of 60 men belonging to Colombia’s National Liberation Army (Ejército de Liberación Nacional — ELN) had moved into in the municipality of Maripa in Bolívar state, allegedly to “protect” mining operations there.
Since May, Indigenous communities in Maripa have been warning that an increase in gold mining along the Caura River was worsening an irreversible “ecological and social crisis,” according to Kapé Kapé, a non-governmental organization helping Indigenous communities in Venezuela. Other reports have stated that ex-FARC Mafia groups, who refused to demobilize during the 2016 peace process with the Revolutionary Armed Forces of Colombia (Fuerzas Armadas Revolucionarias de Colombia — FARC), are also operating in the area.
This violence has accompanied a May decree by the Venezuelan government that opened up mining along the Caura, Cuchivero, Aro, Yuruari, Cuyuní and Caroní rivers. However, according to local communities, this exploitation has seen illegal groups, such as the ELN, move in to offer protection to the new mining installations.
As part of its expansion into Venezuela, the ELN has set up a presence in the country’s main mining areas, including Bolívar. In October 2018, the ELN was reportedly responsible for the massacre of seven miners in Sifontes, Bolívar, near the Venezuela-Guyana border.
InSight Crime Analysis
Attempts to control mining operations along the Caura River and its surrounding areas appear to be organized jointly by the ELN and elements within the Venezuelan government.
While InSight Crime has not confirmed the ELN’s role in the Yekuana killings in May, the guerrillas are known to be cooperating with state actors in illegal mining operations in other parts of Bolívar and have been implicated in several massacres related to control of mineral deposits.
The mining sector, especially gold, has become a financial lifeline for the Venezuelan government. Since 2016, President Nicolás Maduro has made a series of attempts to increase his control over this lucrative economy, especially in the Orinoco Mining Belt, which includes the Caura River.
An important part of this strategy has reportedly been to let the ELN assume control of much of these operations, driving out other armed groups and ensuring miners pay a portion of their revenue.
“The Maduro government wants to clean up Bolívar’s mining areas with the help of the ELN. It knows that the best way to ensure control of that region without getting its hands dirty is through a clandestine collaboration with this guerrilla group,” Américo de Grazia told InSight Crime.
And Indigenous communities are paying the price. The Yek’wana, Sanemá and Hoti Indigenous communities who live along the Caura River basin have been suffering from violence and environmental destruction brought about by mining for years.
“Indigenous peoples are caught in an economic trap from which they cannot escape. The pressure exerted by both state actors and organized criminal groups and the scarce job opportunities has led them to work in these mines and renounce their ancestral traditions,” Olnar Ortiz, a Venezuelan lawyer and defender of Indigenous rights, told InSight Crime.
In a July 15 report, the United Nations High Commissioner for Human Rights explained that the expansion of illegal mining activity in the Orinoco Mining Belt “affects the enjoyment of the individual and collective rights of Indigenous people, due to the destruction of their habitat and the lack of control over their traditional territories and natural resources.”
Reports that the head of the Jalisco Cartel New Generation constructed a hospital, both for himself and local residents, is a concrete example of Mexico’s criminal groups investing in real infrastructure to garner the support of local communities.
On July 27, El Universal reported that Mexican authorities had located a hospital in the Jalisco state community of El Alcíhuatl allegedly built by Jalisco Cartel New Generation (Cartel Jalisco Nueva Generación – CJNG) boss Nemesio Oseguera Cervantes, alias “El Mencho.”
The hospital was primarily constructed so that Oseguera Cervantes, who is believed to suffer from kidney disease, could receive treatment without putting himself at risk of capture by authorities. However, local residents and members of El Mencho’s security team are reportedly also allowed to use the hospital’s services.
The CJNG has consistently made headlines this summer with several unprecedented displays of force.
The Mexican government has accused them of carrying out the June 26 assassination attempt against Omar García Harfuch, Mexico City’s public security secretary, which killed two bodyguards and a passerby.
Then, in mid-July, a video surfaced of an apparently massive CJNG convoy of armored vehicles, featuring at least 80 men carrying 75 high-powered weapons, according to El Universal. In the video, the cartel members can be heard shouting their declarations of loyalty to El Mencho.
As InSight Crime reported in an extensive profile of the CJNG in June, the cartel still struggles to consolidate power in several key locations, including northern Mexico, Tierra Caliente and the Mexico City area.
InSight Crime Analysis
There have been a number of historic examples of criminal groups in Mexico providing essential goods to local communities, especially during the recent coronavirus pandemic. But building actual infrastructure such as schools or hospitals is rarer, while not unknown.
Those which have done so usually acted to fulfill specific community needs.
“La Familia Michoacana and the Knights Templar built a number of schools which were needed in Tierra Caliente, Guerrero,” Oscar Balderas, a Mexican journalist specialized in organized crime, told InSight Crime.
“And in the eastern state of Veracruz, orange growers had long asked the government to build better roads so they could sell their produce more easily. The government never did, so the Zetas built a lot of the roads which connect Veracruz and Tamaulipas, especially between Tuxpan and Tampico,” he added.
Former Sinaloa Cartel leader, Joaquín Guzmán Loera, alias “El Chapo,” cultivated a reputation as a celebrity, especially among rural communities in Sinaloa. But in a 2015 investigation, the Associated Press could not find any physical infrastructure built by Guzmán Loera for the benefit of local communities in Sinaloa.
“I don’t see a single building producing jobs, a single piece of public works, a soccer field, a sewer, a school, water systems, a clinic or hospital, not a single one that you can say was built by drug traffickers or their money,” Mario Valenzuela, then-mayor of Badiraguato, where El Chapo was born, told the press agency.
Instead, his celebrity status appears to be more based on his prestige as a drug trafficker and his repeated prison escapes.
“Why do people admire him [El Chapo]? Because he’s a living legend. He’s like Al Capone, like Lucky Luciano, like Tony Soprano, like Scarface. He’s like a television character, except he’s alive, he’s real,” Adrián Cabrera, a journalist in Culiacán, Sinaloa, told Milenio.
Despite the CJNG’s penchant for high-profile acts, El Mencho has not sought such a cult of personality. Even before he became one of the most-wanted criminals in Mexico and the United States, Oseguera Cervantes almost never appeared in public.
It is no surprise he chose to build his hospital in El Alcíhuatl, a town in the middle of the CJNG’s heartland and where he clearly feels safe. This is despite the fact that the hospital is located just 50 kilometers from Villa Purificación, a major CJNG stronghold where members shot down a Mexican military helicopter in 2015 during a failed attempt to capture El Mencho.
After coming under pressure from a human rights group, the Mexican Navy seems close to accepting responsibility for a number of disappearances that occurred along the US-Mexico border in 2018, confirming what locals had long suspected.
In a recent report, Mexico’s National Human Rights Commission (Comisión Nacional de los Derechos Humanos — CNDH) “managed to attribute” to Mexico’s Navy (Secretaría de Marina — SEMAR) 27 cases of people “arbitrarily detained and disappeared” in the city of Nuevo Laredo in northern Tamaulipas state between March and May 2018. Twelve of these individuals were later found dead.
Those behind the crimes reportedly kidnapped people driving or walking on the street, and even entered businesses and homes without arrest or search warrants before taking the victims away, at times without any identification and using official vehicles, according to the report.
The CNDH found the Navy’s official reports of some of these incidents were also manipulated.
Local human rights activists said the victims came from all sectors of society: a housewife, a baker, a 16-year-old, among others, and that authorities may have targeted them to “gather intelligence,” according to a Univision report.
Among other recommendations, the commission asked the Navy for “full compensation” for those affected by the forced disappearances, to continue searching for the other 15 individuals still missing and requested that criminal investigations be initiated.
The Mexican Navy “accepted” the recommendations in a July 21 tweet and vowed to show their “commitment” to defending human rights. Shortly after the original complaints were made, the Navy said “in all cases in which Navy personnel are likely responsible for human rights violations, they will act with strict adherence to the law, proceed with rigor and … await the resolution,” according to a September 2018 press release.
In 2018, however, the Navy “denied [they] had participated in the events, criminalized the victims [and] attributed these disappearances to an organized crime group,” according to statements from a local human rights leader.
InSight Crime Analysis
Despite being Mexico’s most trusted security force, the Navy’s role in allegedly disappearing and murdering innocent civilians serves as a stark reminder of the severe abuses that too often come with the country’s militarized crackdown on organized crime.
The use of deadly force by Mexico’s marines in alleged clashes with armed groups shot up considerably between 2012 and 2019, raising concerns about a lack of oversight, training and accountability for such forces.
The Navy’s potential admission would be a welcome step. But evidence suggesting that Mexican marines were involved in the dozens of disappearances along the US-Mexico border more than two years ago had been present from the onset.
The United Nations’ Office of the High Commissioner for Human Rights (OHCHR) said in a May 2018 press release that they had received testimony strongly suggesting the disappearances were “perpetrated by a federal security force.”
But despite there being “ample information and evidence,” Mexican authorities had at the time — and since — made “little progress in locating the disappeared persons and investigating what happened to them,” according to the OHCHR.
Months later, Amnesty International said in a July 2018 press release that the victims’ families had implicated Mexico’s Navy in the disappearances based on“witness testimony and audio-visual material collected during the events.”
Weapons and forensic experts at Amnesty International concluded then that video footage of one of the victims’ arrests showed the suspects appeared to be “professionally trained and equipped with vehicles, uniforms and weapons — including Sig516 rifles — that strongly resemble those used by the Navy.”
But at the time, Mexico’s Attorney General’s Office was instead said to be investigating a splinter faction of the feared Zetas criminal group, known as the Northeast Cartel, which is led by Juan Gerardo Treviño Chávez, alias “El Huevo.”
Authorities said the group was involved in the disappearance of at least 35 people between February and May of 2018 in Nuevo Laredo, El Universal reported.
Mexican officials alleged that members of the group were often seen wearing Navy-style uniforms and brandishing weapons that are “used exclusively” by the country’s armed forces, according to El Universal.
They offered no explanation as to how the group may have obtained such materials.
Amnesty International stressed that while criminal groups have at times disguised themselves as security forces, there was “sufficient evidence” to conduct an independent investigation into the Navy’s alleged role in the disappearances in 2018.