DEA Congressional Testimony
July 17, 1997

DEA Congressional Testimony

Statement by:
James Milford
Acting Deputy Administrator
Drug Enforcement Administration

Before the:
Subcommittee on National Security,International Affairs and Criminal Justice

Regarding:
Caribbean/South Florida

Date:
July 17, 1997

Note: This document may not reflect changes made in actual delivery.

Contents

A History of Smuggling in the Caribbean

The Emergence of New Trafficking Threats in the Western Hemisphere

Puerto Rico Gateway to the Caribbean

The Cost of the Cocaine Trade to Puerto Rico

The Role of the Dominican Republic

The Lure of the Bahamas

South Florida and Orlando

Heroin: The Rising Tide

A Hemispheric Law Enforcement Response

Conclusion

 

Mr. Chairman, Members of the Subcommittee: I appreciate the opportunity to appear before the Subcommittee today to discuss drug trafficking in the Caribbean Theater and South Florida and the destructive impact that organized criminal syndicates are having on this region. First, I would like to sincerely thank you, Mr. Chairman, and the members of the Subcommittee, for your continued support of DEA and its programs, both internationally and on the homefront. You have continually showed your support by traveling to the "hotspots" in the United States, South America and Asia, to see first hand the devastation caused by drug abuse that stems from the poison that flows from the drug producing and transit regions to the streets of our country.

The international drug syndicates operating throughout our hemisphere are resourceful, adaptable and extremely powerful. These syndicates have an unprecedented level of sophistication and they are far more organized and influential than any organized crime enterprise preceding them. Traditional organized crime, operating within the United States from the turn of the century to the present time, simply cannot compare to the Colombian and Mexican organizations operating in mainland U.S. and the Caribbean area today. Today’s international crime syndicates have at their disposal an arsenal of technology, weapons and allies --- corrupted law enforcement and government officials --- enabling them to dominate the illegal drug market in ways we never thought possible. Today’s drug syndicate leaders are able to oversee a multi-billion dollar cocaine and heroin industry which affects every aspect of American life.

These drug lords, who mastermind trans-global organizations responsible for every facet of the drug trade, are almost immune to conventional law enforcement strategies. Any effective program must address the threat they pose from a hemispheric posture, because they control the seamless continuum of the drug trade from the jungles of South America, to the transshipment corridors in the Caribbean and Central America, to the streets of almost every city and town in America. Their army of workers is responsible for logistical support --- transporting the drugs, arranging for storage, renting a fleet of cars and cell phones and faxes to ensure the smooth operations of the syndicates. All the business decisions --- large and small --- are made from headquarters locations far away from the streets of New York, Chicago, Orlando, and San Juan. But as we all know, these decisions have a ripple effect, forcing us to make choices about our personal schedules, our children’s schools, and where we live.

 

A History of Smuggling in the Caribbean

The Caribbean Corridor and South Florida have long been favorite smuggling routes used by the Cali and Medellin crime groups to smuggle thousands of tons of cocaine to the United States. The narco-traffickers from Colombia seized control of the cocaine trade in the late 1970's, virtually eliminating U.S. based entrepenuers and independent traffickers from the wholesale cocaine market. These individuals ruled the drug trade with an iron fist, exponentially increasing their profit margins by controlling the entire seamless continuum of the cocaine trade, from coca leaf production in Peru, Bolivia and Colombia to cocaine HCL production on the processing centers in Colombia, and the sale of a few kilograms of cocaine on the streets of the United States.

These traffickers established a labyrinth of smuggling routes throughout the Caribbean, the Bahama Island chain and South Florida, using a variety of smuggling techniques to transfer their cocaine to U. S. markets including; airdrops of 500-700 kilograms in the Bahamian Island chain and off the coast of Puerto Rico, mid-ocean boat-to-boat transfers of 500 to 2,000 kilograms, and the commercial shipment of multi-tons of cocaine through the port of Miami to transfer their cocaine to U.S. markets. The "Cornerstone" case in Miami is an excellent example of the ingenuity of the sophisticated leaders of the Cali crime syndicate and the volume of cocaine they were exporting to the United States. In a period of a little over two years, the DEA and U.S. Customs Service worked together to seize over 20 tons of cocaine in just six commercial shipments of cement posts, broccoli and coffee. More importantly the seizures were "the cornerstone" of criminal cases built on the US infrastructure of the Cali cells in Miami, that resulted in the long-term incarceration of the leadership of key Cali transportation and distribution cells and integral to the imprisonment of the Cali leaders.

Miquel Rodriguez Orejuela, his brother Gilberto and Jose Santa Cruz Londono created, in Cali Colombia, what was undeniably the most wealthy, sophisticated and powerful organized crime syndicate in history. Orejuela and his confederates built an enormous monolithic organization that orchestrated the manufacture of hundreds of tons of cocaine in Colombia, which were then moved through the Caribbean and later Mexico, to U.S. markets. The leadership of the Cali Cartel ruled this seven billion dollar per year business, while safely ensconced on foreign soil. In short, they became the prominent "mob leaders of the 1990's." However, they were wealthier, more influential and far more dangerous, having a more devastating impact on the day-to-day lives of the citizens of our country than either their domestic predecessors or the crime families from Medellin.

Orejuela set up an extremely well-disciplined system of compartmentalization that spanned and insulated every facet of their drug business. The organization’s tentacles reached into the cities and towns of the United States, either through their U.S.-based wholesale distribution infrastructure, or their surrogates who sold crack cocaine on the streets of locations as varied as Chicago, Illinois and Rocky Mount, North Carolina. At the height of his power, Orejuela was reportedly using as much as one-half of his seven billion dollar annual income from drug sales to bribe government officials, judges, and police officers in Colombia. Although they freely used their enormous wealth to bribe, they were just as prone to violence as the thugs from Medellin.

Just as "traditional" organized crime was addressed over time in the United States by exposing its leaders and systematically stripping away the pretense that they were legitimate businessmen, the organized criminal groups from Colombia have been eviscerated, and are now a fragment of what they once were. The Colombian National Police (CNP), through tenacity, courage and bravery that has seldom, if ever, been seen in law enforcement, faced down the most powerful organized criminal syndicates in history. Through the fearless leadership of General Rosso Serrano and Colonel Leonardo Gallego of the Colombian National Police, as well as that of General Harold Bedoya of the Colombian military, they built cases on the entire upper echelon of the Cali and Medellin drug trafficking organizations. They methodically tracked each leader down until the entire infrastructure of both mafia’s was either incarcerated or dead. There is no tribute too great for the brave men and women of the CNP who gave their lives in this effort

 

The Emergence of New Trafficking Threats in the Western Hemisphere

With the increased pressure placed on the Cali groups’ smuggling and distribution operations in South Florida and the Caribbean, in the late 80's and early 90's, they turned to established smuggling organizations in Mexico to move cocaine to the United States. Originally, these Mexican crime families received shipments of cocaine from the Cali syndicate and then smuggled it across the U.S.- Mexico border, where it was turned over to Colombian distribution cells. First paid $1,000 to $2,000 per kilo for their services, they ultimately began receiving between 40% to 50% of each shipment as payment. Amado Carrillo-Fuentes and the other major traffickers quickly amassed fortunes from the profits of the sale of thousands of kilograms of cocaine and systematically expanded their distribution networks. This changed the face of the drug trade in the United States and the organized criminal groups from Colombia lost their stranglehold on the U.S. wholesale market.

The ascension to power by the groups from Mexico has garnered them enormous wealth and a demonstrative expansion in their spheres of influence. Despite accurate reports indicating the Orejuelas have ready access to both pay and cellular phones in their cells, they are unable to control their vast empire from jail. Consequently, their ability to function as the first among all others has been seriously degraded. There are many groups in Colombia and Mexico trying to fill the void left by the incarceration of the Cali leadership. Without question, the organized crime families in Mexico, most notably the Arellano-Felix brothers, Miquel Caro-Quintero and Jesus Amezcua-Contreras, and, until his death two weeks ago, Amado Carrillo-Fuentes, have eclipsed the Colombian traffickers as the most dominant figures in the cocaine trade today. The criminal groups from Mexico now control virtually all cocaine sold in the Western half of the United States and, for the first time, we are seeing a concerted effort on their part to expand into the lucrative East Coast market.

However, Colombian traffickers still dominate the movement of cocaine from the jungles of Bolivia and Peru to the large cocaine hydrochloride (HCL) conversion factories in Southern Colombia and their fingerprints are on the vast majority of cocaine sold in the United States today. While it is likely that the remnants of the Cali group, still directed by the Orejeulas, as well some Cali splinter groups, such as the Grajales-Urdinolas, are still using their established connections with the criminal groups in Mexico to smuggle cocaine to distribution groups in the United States. The new independent traffickers from the Northern Valle del Cauca have risen to prominence. and are responsible for huge volumes of cocaine and heroin being shipped to the United States. Most of these new groups have returned to the traditional smuggling routes in the Caribbean to transport their cocaine and heroin to markets on the United States’ populous East Coast. The following traffickers are among the most wealthy and powerful criminals operating in Colombia today:

Jairo Ivan Urdinola Grajales and his brother Julio Fabio Urdinola Grajales head a major drug trafficking organization associated with the so-called Northern Valle del Cauca drug mafias. The Urdinolas are related by marriage to the Henao Montoya family. The CNP arrested Ivan in April 1992, while Fabio later surrendered to Colombian authorities in March 1994. The incarceration of the Urdinola Grajales brothers notwithstanding, their organization reportedly remains active in the drug trade.

The Henao Montoya brothers, Arcangel de Jesus and Jose Orlando, run trafficking operations out of the Northern Valle del Cauca region. The Henao Montoyas run the most powerful of the various independent trafficking groups that comprise the North Valle drug mafia. The major North Valle drug mafia organizations are poised to become among the most powerful drug trafficking groups in Colombia. The Henao Montoya organization has been closely linked to the paramilitary group run by Carlos Castano, a major cocaine trafficker in his own right.

Diego Montoya Sanchez heads a North Valle trafficking organization that transports cocaine base from Peru to Colombia and produces multi-ton quantities of cocaine HCL for export to the United States and Europe. DEA considers Montoya Sanchez to be one of the most significant cocaine traffickers in Colombia today.

In March 1996, Juan Carlos Ramirez Abadia (aka "Chupeta"), surrendered to Colombian authorities. Chupeta is believed to have surrendered, in part, due to his fear for his personal safety and to be eligible for a more lenient prison sentence. In December 1996, Chupeta was sentenced to 24 years in prison, but may actually serve as little as 7 1/2 years due to Colombia’s lenient sentencing laws. DEA and CNP reports indicate that Chupeta continues to direct his drug operations from prison.

Julio Cesar Nasser David heads a major polydrug trafficking and money laundering organization based out of Colombia’s North Coast. His organization smuggles multi-ton quantities of cocaine and marijuana to the United States via commercial shipments and maritime vessels. In 1994, DEA and Swiss authorities arrested Nasser-David’s wife and seized over 180 million dollars in drug proceeds concealed in secret Swiss bank accounts.

Alberto Orlando Gamboa (aka "Caracol") runs the most powerful drug trafficking organization on the North Coast. Gamboa exploits maritime and air routes to the Dominican Republic, Haiti, Puerto Rico, and other Caribbean islands, to smuggle multi-ton quantities of cocaine and marijuana into the United States.

 

Puerto Rico Gateway to the Caribbean

Puerto Rico and the U.S. Virgin Islands are the United States’ Southern most points of entry and lie astride the Caribbean Corridor, providing an excellent gateway for drugs destined for cities on the United States’ East Coast. Puerto Rico’s 300-mile coastline, the vast number of isolated cays and six million square miles of open water between the U.S. and Colombia, make the region difficult to patrol and ideal for land, sea and air smuggling of drugs, weapons, illegal aliens and currency. Puerto Rico is also a significant air and sea transportation port in the Caribbean for travelers destined for the United States. It has the third busiest seaport in North America and the 14th busiest in the world. More than 75 daily commercial flights arrive in the Continental United States from Puerto Rico and it is also a major port for commercial maritime shopping. The traffickers’ biggest asset is the sheer volume of the commercial trade.

Only 360 miles from Colombia’s North Coast and 80 miles from the East Coast of the Dominican Republic, Puerto Rico is easily accessible by twin engine aircraft hauling payloads of 500 to 700 kilos of cocaine. Ocean-going go-fast boats make their cocaine runs in the dead of night to the Southern Coast of Puerto Rico, only having to stage a refueling vessel on their return trip or carry extra fuel, to be able to make the round trip in less than a day.

More importantly, Puerto Rico’s commonwealth status means that once a shipment of cocaine, whether smuggled by maritime, air or commercial cargo, reaches Puerto Rico, it does not have to be subjected to further United States Customs Service inspection en route to the continental U.S.

Today, cocaine and heroin traffickers from Colombia have transformed Puerto Rico into the largest staging area in the Caribbean for smuggling Colombian cocaine and heroin into the U.S. The municipalities in the Central mountain range and the South Coast provide the bases of operation for the command and control functions of the Colombian syndicates. It is also important to note that except for the south coast where DEA has the Ponce Resident Office, there has heretofore been no major law enforcement presence on this part of the island. As part of the Criminal Investigative Implementation Plan, the FBI plans to place regional enforcement teams in Ponce, Aguadilla, and Fajardo.

These new organized criminal groups from Colombia have enlisted the aid of traffickers and smugglers from the Dominican Republic to deliver their product to market and have placed an entire command and control infrastructure in the Caribbean, predominantly in Puerto Rico, to manage the movement of cocaine throughout the Caribbean Corridor. There has been a concerted effort on the part of these Colombian groups to franchise their smuggling and transportation operations to Puerto Rican and Dominican groups in order to minimize their presence on the island. This is an example of the recent decentralization of the cocaine trade in Colombia. The leaders of these new Colombian groups are adopting a less monolithic approach in their operations, even demonstrating a willingness to franchise distribution operations in the United States.

This has effectively amputated one to two levels of the Colombian cell system and forced them to relinquish some profits and control. The cell system is still employed to provide security and compartmentalization, but it no longer exists to the extent that the Colombian traffickers exert complete control over the distribution networks. They have been using Dominican trafficking groups to handle, and to some degree, control wholesale and street level distribution of cocaine and heroin in the United States. By using this approach, they may forego some profits, but they gain the insulation from U. S. justice that they desire. These new traffickers, vying for the Cali throne, understand that direct control creates vulnerability for the criminal organizations’ leadership in both the United States and Colombia.

Puerto Rico is also a local distribution market that is highly profitable and competitive. As the organized drug syndicates from Colombia have done in Mexico, they are paying local Dominican and Puerto Rican transportation groups for their services in cocaine. This form of "payment" and the alliances that have been created between the Colombian traffickers and the transporters have caused a "spill-over effect" on the local market, dramatically driving down wholesale prices of cocaine in Puerto Rico. The per kilogram price for cocaine in Puerto Rico is lower than anywhere else in the United States.

The 20 percent fee charged by Dominican and Puerto Rican transportation groups gives them a competitive edge over the groups in Mexico, who are still demanding 50 percent of each shipment. This makes using Puerto Rico and the Dominican Republic a far more profitable venture for the Colombian traffickers, and allows them to recoop part of the profits lost to franchising wholesale operations.

 

The Cost of the Cocaine Trade to Puerto Rico

As in most locations where the cocaine trade flourishes, competition for control of the local market has resulted in an escalation of violent crime and drug-related murder. Tragically, as we have seen in Colombia, Mexico and the United States, violence is attendant to the drug trade. Approximately 70 percent of all documented homicides in Puerto Rico are drug-related. In 1984, the number of homicides in Puerto Rico numbered 483. Homicides steadily increased until they numbered 992 in 1994, 864 in 1995, and 868 in 1996. This is compared to New York City where the homicide rate has fallen by 50% to approximately 1,000 per year over the same time period. Puerto Rico also leads the nation in the number of reported car-jacking incidents. Over the last four years, there have been more than 8,000 armed car-jackings.

Primarily, Puerto Rican or Dominican gangs handle cocaine distribution into the local market. These gangs vary from the highly structured to the very loosely-knit family groups that control the drug market in various locations on the island. These groups are able to easily adapt to disruption in the organizational structure by merely providing immediate replacements when the need arises.

Predictably, the increase in drugs transiting Puerto Rico has increased the local availability and accompanying rise in addiction rates. It is estimated that 20 percent of the drugs that transit the island stay there and are consumed by Puerto Ricans. Cocaine continues to be the drug of choice in Puerto Rico. Crack cocaine abuse is reaching epidemic proportions in the nearby U.S. Virgin Islands. The demand for cocaine is on the rise and local traffickers are becoming more violent in their efforts to protect their distribution territory.

 

The Role of the Dominican Republic

The proximity to Puerto Rico, and the economic conditions in the Dominican Republic, lure a large number of immigrants to Puerto Rico. Dominican groups have gained control of a number of Puerto Rico’s housing projects where they utilize violence and intimidation to control the cocaine market. Some of these immigrants have virtually become "armies for hire" whose direct links to the Colombian drug organizations have changed dramatically over the course of the last few years.

In the past, the Dominicans’ role in illegal drug activity was limited to being "pick up crews" and couriers who assisted the Puerto Rican smugglers in their drug smuggling ventures. Much of this has changed due to the evolution of the Dominican traffickers in the drug trade. This new breed of Dominican trafficker functions as smuggler, transporter and wholesaler in many cities on the East Coast and are able, through direct links to the Colombian drug traffickers, to dominate a significant portion of the market in major East Coast cities.

These Dominican trafficking groups utilize wooden hulled boats with center consoles as their vessel of choice for smuggling operations. These "yolas" are low-profile, which enhances the traffickers’ ability to avoid radar detection, and have been retrofitted with plastic fuel tanks in order to extend their range. Boat crews also rely on cellular telephone communications rather than high frequency radios to further enhance their security measures.

Trafficking groups also continue to use "go-fast" boats, fishing vessels and pleasure craft to enhance their transportation capabilities. "Go-fast" boats have the ability to travel from South America to the Caribbean region in one day, carrying payloads of multi-hundred kilograms of cocaine, while utilizing their high speeds to evade law enforcement. The other vessel types are less attractive due to the slow speed at which they are capable of traveling, although they do have the advantage of easily assimilating into the other legitimate vessel traffic in the region. Larger cargo or passenger compartments also allow the traffickers the option of constructing well-hidden secret compartments to store and transport their drugs.

Traffickers from the Dominican Republic have developed intricate trafficking networks to distribute cocaine and heroin for the Colombians in the lucrative New York market, as well as in cities all along the East Coast. Dominican traffickers operate with efficiency, relying heavily on counter surveillance, and operational security to ensure success. They use sophisticated communications equipment, cloned cellular communications, alarm systems, and police scanners to monitor the activity of law enforcement. They also rely heavily on the ingenious construction of vehicle "traps" to secrete and secure their drug loads for transportation in passenger vehicles or trucks for transportation to cities throughout the Northeast.

The criminal groups from the Dominican Republic also provide a natural conduit for Colombian heroin to the large addict population in New York and the Northeastern United States. Approximately 63 percent of the heroin seized in the United States last year was of South American origin. Abuse of high quality Colombian heroin, which can easily be snorted or smoked rather than injected, the traditional method of administration, has significantly increased over the last several years, and its use has unfortunately become "fashionable" for many young people. The heroin trade in Colombia is controlled by independent traffickers who harvest the poppy in the mountainous areas of the Andes and produce heroin in small laboratories throughout the area. They then employ an army of couriers who smuggle the heroin into the United States via ingestion, body carries, and increasingly, in concealed compartments in luggage. The couriers enter the United States primarily at the ports of San Juan, Puerto Rico, Miami, Florida, and New York City, from where they distribute this highly addictive drug all along the East Coast.

The Dominican traffickers have also come into their own right in the money laundering arena and have established a network of casas de cambio throughout the Caribbean and in New York.

 

The Lure of the Bahamas

The Bahama Island chain, which lies northwest of Puerto Rico and the Dominican Republic and just northeast of Cuba, has been a center for smuggling of contraband for centuries. During the heyday of the Medellin Cartel, Carlos Lehder bought an entire island, Norman’s Cay; where he flew planes laden with hundreds of kilos of cocaine to stage for entry into the United States. To counter the threat in the Northern Caribbean, including the Turks and Caicos Islands, the United States government initiated Operation Bahamas and Turks and Caicos (OPBAT) in 1982. A joint Bahamian, DEA, U.S. Customs, U.S.Coast Guard and Department of Defense interdiction operation headquartered in Nassau, Bahamas, OPBAT has had enormous success over the years, seizing thousands of kilograms of cocaine and literally driving the transportation groups working for the Cali syndicate out of the northern Caribbean. Increased interdiction and enforcement pressure in South Florida and Puerto Rico forced Orejuela and his confederates to turn to Mexico as an alternate route.

The threat we now face in the Northern Caribbean is constantly changing. Traffickers shift from using remote airstrips to airdrops, to waiting go-fast boats, to maritime scenarios using boat-to-boat transfers and commercial shipments. In October of 1996, 6.5 metric tons of cocaine was seized from on board the freighter Limerick after Cuban officials searched the vessel at our request, when it washed into Cuban waters after developing engine problems. The cocaine from this shipment was destined to be off loaded in the Bahamas were it would be transported to the U.S. mainland by go-fast boats.

One prominent method being used by Bahamian and Jamaican transportation groups involves Colombian traffickers airdropping shipments of cocaine off of the coast of Jamaica or utilizing boat-to-boat transfers in open seas. Jamaican and Bahamian transportation groups then use Jamaican " canoes" to smuggle their payloads into the Bahama chain, frequently using the territorial waters of Cuba to shield their movements. They then transfer the cocaine to pleasure craft which disappear into the inter-island boat traffic. Traffickers also use twin-engine turbo-prop aircraft, with long range capability, Global Positioning Systems, which pinpoint drop zones and meeting spots in the middle of the ocean, and cellular telephones, to minimize their exposure to interdiction assets and ensure the smooth transfer of their cargo of cocaine for shipment on to the United States.

We are very concerned about the new containerized shipping port facility in Freeport, Bahamas, which will function as a freight forwarding point for containerized commercial cargo being sent to various ports in the United States and Europe. The containers are not to be opened while in Freeport , however this is an opportunity ripe for opportunistic smuggling organizations to exploit.

Even more disturbing are current plans to make Freeport a free trade zone, which will allow cargo shipped through the port to be opened and merchandise to legitimately be removed and added while in port.

 

South Florida and Orlando

Miami has always been the home of the highest echelon command and control personnel for the organized criminal organizations from Colombia. In the early 1980's, thugs from Medellin turned the streets of Miami in to a war zone as the "Cocaine Cowboys" brought their indiscriminate violence to the United States. However, programs like Operation REDRUM, a joint effort between DEA and the Metro Dade and Miami Police Departments that focused on drug related Colombian contract killings, soon convinced the violent traffickers from Medellin that they would be methodically hunted down and prosecuted for their crimes and not allowed to act with impunity as they had in Medellin. For example Griselda Blanca, known as the Godmother of cocaine and closely allied with Pablo Escobar, is currently on trial in Miami for several murders committed in the 1980's. The REDRUM investigation, that lasted over a decade, linked her to over 50 drug related murders, some of which she committed herself.

Miami’s port-of-entry, which handles hundreds of thousands of tons of commercial cargo, both through Miami International airport and the seaport, is ideal for smuggling large shipments of cocaine into the United States. Tramp freighters by the hundreds tour the Caribbean, going island to island picking-up and dropping off cargo. It is a relatively simple matter for Captains, with the inclination, to stop mid-ocean and take on hundreds of kilograms of cocaine and conceal them in false compartments and walls or take on commercial cargo at ports of call with cocaine already concealed inside. The scenarios are as numerous and varied as the imagination can conjure and the traffickers from Cali and the new independent groups are sophisticated and inventive in their methodology.

Once the cocaine arrives in Miami, the Colombian traffickers have a 2 decade-old transportation infrastructure, composed largely of Cuban-Americans who work at the air and seaports, to facilitate the off loading and warehousing of cocaine shipments and frequently provide transportation via tractor trailer or private vehicle to Colombian Cell heads on the east coast and in the Midwest. The cell managers based in Miami direct transportation and distribution of thousands of kilograms of cocaine while other cell managers are in charge with the collection of the proceeds from the cocaine sales.

These narco-dollars, largely in 5, 10, and 20 dollar denominations, are sent to Colombia through a variety of methods. During the last few years, Colombian traffickers have used the bulk shipment of cash to move drug proceeds to Colombia. This is largely a reflection of the success of federal law enforcement’s undercover money laundering investigations and the recent Geographical Targeting Order placed on wire-transmitters like Western Union and CASA de Cambias, by the U.S. Treasury Department, requiring the reporting of all money transfers which exceed $750 sent outside the United States. Money launders have begun to increasingly rely on bulk shipments of cash in commercial shipments to Colombia. In August of 1996, DEA and U.S. Customs in Miami found over six million dollars in U.S. currency in a warehouse awaiting shipment to Colombia. Working with DEA and Customs in New York, it was determined that a second shipment was already en route to Colombia aboard the M/V Christian. A search of this container at the Port of Miami, revealed over $9 million in U.S. currency concealed in stereo equipment and hot water heaters. The bulk shipment of money substantially increases traffickers exposure and risk by forcing them to pool large sums of cash in preparing for shipment. The New York Police Department recently reported seizing $37.8 million in drug proceeds during the first six months of 1997, amounting to a 28% increase over the same period in 1995.

Historically, the center for cocaine trafficking in South Florida has been Miami and Dade County. However, with the rise to prominence of Puerto Rico as a key transhipment point for both cocaine and heroin to the United States, Orlando has become a hub for cocaine and heroin transhipment distribution. Criminals from Puerto Rico use the significant legitimate Puerto Rican population employed in Orlando to mask their presence and activities. In 1995, DEA, the U.S. Customs Service, the Orange County Sheriff’s Office and the Metropolitan Bureau of Investigation, broke up a Puerto Rican distribution organization supplied by Colombian traffickers that imported over 120,000 kilograms of cocaine and 50 kilograms of heroin into the Orlando area for redistribution in Orlando and the Eastern United States. Over $18 million in U.S. currency was seized from the organization.

 

Heroin: The Rising Tide

The Eastern Caribbean Corridor is the second most active drug trafficking route into the Western Hemisphere and the majority of South American heroin entering the United States now transits the Caribbean and South Florida.

Just a few years ago, Southeast Asian heroin dominated the East Coast, and Colombian heroin was non-existent. In 1996, 62% of the heroin seized in the U.S. came from Colombia, up from 32% the previous year. The average purity in 1996 was 71.9 percent, while some purchases registered as high as 95.5 percent pure. From New York to Miami, Colombian heroin is widely available, extremely pure and cheap. The organized criminal groups who control the Colombian heroin trade have been able to establish their substantial market share through aggressive marketing techniques, such as providing free samples to new customers, forcing cocaine customers to sell heroin or have their cocaine supply cut-off, and cutting the price of a kilogram of heroin almost in half, from $150,000 to $90,000.

Colombian heroin is prominent all along the East Coast of the United States, as far south as Orlando, Florida. The results of the surge of high quality heroin may best be seen in Orlando where there were 31 overdose deaths in 1996, up 500 % from 1994. These statistics are not unique to Florida, in fact we are seeing a dramatic rise in emergency room episodes involving heroin all along the East Coast.

Puerto Rico is increasingly being used by independent Colombian traffickers as a conduit for heroin destined for the lucrative East Coast heroin market and transportation groups from San Juan are frequently utilizing the criminal infrastructure in Orlando to facilitate heroin transhipment. Unfortunately, this is bringing high quality heroin, offered at a cheap price, to the streets of Orlando at a time when many in the fashion and entertainment industries are seeking to glamorize heroin use. Tragically, teenagers who are ravaged by heroin abuse learn quickly that there is nothing glamorous about heroin. Many begin the abuse process by administering heroin through smoking or ingestion, which they find chic and far more palatable, but they quickly find themselves drawn to injection to satisfy what is frequently called " the hook"; the onset of addiction that happens so rapidly with heroin.

 

A Hemispheric Law Enforcement Response

Cases against the leaders of these criminal groups most often originate from investigations being conducted in the United States. Through what was originally designated our Southwest Border Initiative, but has become a Hemispheric Strategy, DEA and our counterparts direct their resources against the communications systems of the command and control functions of the Organized Crime groups in both Colombia and Mexico and their henchmen in the United States, who direct the distribution of cocaine and heroin and the collection of profits from the drug sales. Operation Cornerstone, to which I referred earlier in my testimony, relied on Title III intercepts in an investigation which included the indictment of the entire Cali organized crime infrastructure and the seizure of over 29 thousand kilograms of cocaine. The Miami Field Division had 97 court authorized wire taps to support investigations against organized crime groups in 1996 and have employed 57 more this year.

With the assistance of our state and local partners domestically and our counterparts in foreign governments, DEA works to build cases against, and ultimately incarcerate, the leaders of these sophisticated criminal syndicates in Mexico and Colombia as well as the underlings they send to the United States to distribute their poison. Over time, this strategy serves to steadily degrade a criminal organization’s ability to conduct business, leaving it even more vulnerable to law enforcement strategies. As you can see from my earlier description of the sophisticated drug smuggling enterprises that proliferate in the Caribbean Theater, a successful counter drug strategy must incorporate an interdiction component that is fed the critical intelligence necessary to be successful. The vastness of the Caribbean Corridor combined with sophisticated compartments utilized in freighters, and the sheer volume and variety of commercial cargo flowing through the Caribbean, makes a meaningful interdiction program very dependent on quality intelligence. Our hemispheric program that utilizes court ordered Title III intercepts as its cornerstone allows us to support agencies with an interdiction mandate with that quality intelligence.

 

Conclusion

Thirty years ago many thought Traditional Organized crime could never be subverted, but fortunately it is now a mere shadow of what it once was. Five years ago nearly every one said that the Miquel Rodriguez Orejuela, and his accomplices in Cali, were invincible. However, we see today that everyone of the criminals from the Cali Cartel are either in jail or dead. The law enforcement systems I have described, which attack the command and control functions of criminal syndicates, have been successful, and over time, they will continue to leave each organization that rises to power, subsuming the remnants of the previous syndicate, provided we continue to have the assistance of foreign law enforcement agencies like the Colombian National Police and the ability to attack the communications system of these organizations.

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