National Drug Intelligence Center   Puerto Rico/U.S. Virgin Islands High Intensity Drug Trafficking Area Drug Market Analysis 2009   April 2009

Abuse

Cocaine, heroin, and marijuana are the most widely abused illicit drugs in the PR/USVI HIDTA; CPDs and ODDs such as MDMA are also commonly abused. Public health officials report that most drug abusers in the region are opportunistic and abuse cocaine, heroin, CPDs, and marijuana interchangeably as availability and price change. Nonetheless, public health officials in Puerto Rico report that heroin abuse is the most significant drug abuse threat in Puerto Rico. As a result, heroin is the primary drug identified in drug-related treatment admissions to publicly funded facilities in Puerto Rico, accounting for 67 percent (1,627 of 2,430) of all admissions, excluding alcohol, in the commonwealth in 2007 (the latest year for which such data are available). According to data from the Substance Abuse and Mental Health Services Administration (SAMHSA) Treatment Episode Data Set (TEDS), more individuals were admitted for the treatment of heroin abuse in Puerto Rico from 2003 through 2007 than were admitted for the treatment of marijuana and cocaine abuse (smoked and by other routes of administration). Cocaine, however, is the primary drug identified in drug-related treatment admissions to Hogar CREA, Inc.,11 the largest privately funded drug treatment network in Puerto Rico, accounting for 33 percent (approximately 2,009 of 6,088) of admissions in FY2007 (the latest year for which such data are available). Marijuana accounted for 28 percent (approximately 1,705 of 6,088) of admissions, and heroin accounted for 23 percent (approximately 1,400 of 6,088) of admissions.12 Comparable data for the USVI are not available and constitute an intelligence gap.

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Illicit Finance

The PR/USVI HIDTA region is a major money laundering center for drug traffickers operating in the region. The San Juan High Intensity Financial Crime Area (HIFCA) reports that the leaders of high-profile money laundering organizations based in Central American and South American countries maintain money laundering cells in Puerto Rico and the USVI. The cells launder the illicit proceeds generated by traffickers operating in the HIDTA region and, in doing so, use financial institutions, money remitters, shell corporations, bulk cash smuggling, and other methods, such as the Colombian Black Market Peso Exchange (BMPE).13

Traffickers in the CONUS routinely smuggle bulk cash to the PR/USVI HIDTA region as well as between the region and other Caribbean countries. The DEA Caribbean, New England, and Philadelphia Field Divisions report that traffickers operating in a number of areas in the CONUS, including Connecticut, Maryland, New Jersey, New York, North Carolina, and Pennsylvania, are increasingly smuggling bulk cash to the HIDTA region for eventual laundering; they also transport laundered cash back to the CONUS. In fact, Puerto Rico has emerged as an important transshipment area for the return of illicit drug proceeds from the CONUS to high-level Colombian and Venezuelan traffickers. Couriers routinely smuggle bulk cash from Puerto Rico to the Dominican Republic for repatriation to Colombia and Venezuela. For example, in August 2008, CBP officers seized approximately $19,000 in cash from a 40-year-old female who was departing Mayagüez, Puerto Rico, for Santo Domingo, Dominican Republic, on board the Caribbean Express, a commercial vessel that transports passengers and cargo on a regular schedule between the port cities of Mayagüez and Santo Domingo.

Footnotes

11. Hogar CREA, Inc., the largest private drug treatment network in Puerto Rico, operates 83 treatment centers in Puerto Rico. The majority of these centers specialize in the treatment of adult males; however, seven facilities specialize in the treatment of adult females, seven specialize in the treatment of teenage boys, and one specializes in the treatment of teenage girls. Federal and commonwealth drug courts, the Department of Corrections, and the Puerto Rico Mental Health and Anti-Addiction Services Administration (ASSMCA, in Spanish) refer patients to Hogar CREA, Inc.
12. The FY extends from July through June.
13. The Colombian Black Market Peso Exchange (BMPE) system originated in the 1960s, when the Colombian Government banned the U.S. dollar, intending to increase the value of the Colombian peso and boost the Colombian economy. The government also imposed high tariffs on imported U.S. goods, hoping to increase the demand for Colombian-produced goods. However, this situation created a black market for Colombian merchants seeking U.S. goods and cheaper U.S. dollars. Those merchants possessed Colombian pesos in Colombia but wanted cheaper U.S. dollars (purchased under official exchange rates) in the United States to purchase goods to sell on the black market. Colombian traffickers had U.S. dollars in the United States--from the sale of illicit drugs--but needed Colombian pesos in Colombia. Consequently, peso brokers began to facilitate the transfer of U.S. drug dollars to Colombian merchants, and business agreements were forged enabling those Colombian merchants to purchase U.S. dollars from traffickers in exchange for Colombian pesos. Although the ban on possession of U.S. dollars was later lifted, the black market system became ingrained in the Colombian economy, and Colombian drug traffickers continue to rely on this system to launder their U.S. drug proceeds.

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