28 December 2006

Organized Crime Finding Mortgage Fraud

The latest statistics from the Federal Bureau of Investigation confirm that mortgage fraud is on the upswing. "We can't find a chart that doesn't show up in a big way," special agent Bill Stern said at a conference on the topic earlier this month in Las Vegas.

Even worse news, the FBI's mortgage fraud coordinator in Washington said, is that the trend is moving away from rogue individuals who pull off the scams and toward members of organized crime. "Mortgage fraud is now a criminal enterprise that puts dollars in the hands of people who also are involved in such other crimes as drugs, murders and gangs," Stern told the conference.

As of early this month, the G-man reported, the number of suspicious activity reports concerning mortgage fraud is up 62 percent from a year earlier. That, he said, "is a stark increase" compared to those alleging commercial loan fraud and false statements. Also up is the number of pending cases, the number of charges and convictions and the amount of cases in which losses against financial institutions, the government and individuals exceed $1 million, Stern reported. "We are now are prosecuting new cases at the rate of one a day," he told the conference. As of the first week of December, he also reported, 54 percent of the losses attributed to mortgage fraud were more than $1 million.

Noting that the FBI must focus on these larger cases because it doesn't have the resources to pursue every suspect, Stern called on the mortgage business to work hand-in-hand with law enforcement officials at the state and federal levels. "We can't work these cases in a vacuum like we do drug cases, where lives are in danger and you don't need any special expertise," he told the meeting.

Encouraging lenders to participate in working groups and industry task forces "so we can leverage off your expertise," the FBI official said agents can't go to mortgage finance school for six months before they tackle a case of possible mortgage fraud. "We don't have agents who work only mortgage finance cases as a career. They work a terrorist case, then a fraud case, then another kind of case, and they are all very different things. So we look to industry as a resource in helping us fight this growing crime."

And to anyone in the housing finance system who has ever turned suspicious activities into the FBI for investigation and received no response, even months later, the G-man also let it be known that the agency feels your pain. "We share your frustration," he said. "Agents who devote hundreds of hours investigating cases that aren't prosecuted are frustrated, too."

Stern's mournful statement was in answer to a conference participant who wanted to know how come he never heard back from the FBI after his company had spent hundreds of thousands of dollars in time and money to investigate possible corruption.

A supervisory special agent who is the mortgage fraud point man in Washington who decides how the FBI's 56 field offices can best focus their limited resources, Stern didn't have a direct answer for the questioner, who asked what it takes to get the agency to investigate a possible crime. The man said that while his company lost $6.2 million, the state was able to gain six felony plea agreements with the perpetrators.

Stern responded that the amount of the loss seemed sizable enough to warrant the FBI's interest. But since he wasn't familiar with the case, he couldn't provide a more specific answer, other than to say "all cases can't be prosecuted." "It all comes down to monetary loss," the special agent explained.

Realty Times, December 27, 2006

22 December 2006

Call for Papers: Interviewing “Organized Criminals”

Invitation to contribute to a special issue of TRENDS IN ORGANIZED CRIME: Interviewing “Organized Criminals”
(revised: 20061218)

While in the past research on organized crime has primarily relied on official and journalistic sources, more and more studies prove that direct access to ‘organized criminals’ is possible. The purpose of this special issue is to give readers an idea of the difficulties and possibilities of conducting offender interviews in the area of organized crime and to provide a basis for answering questions like: Are offender interviews more valid and reliable than other data sources? Can interview-based research on organized crime be planned and replicated, or does it always depend on uniquely fortunate circumstances? Are interviews with ‘organized criminals’ dangerous; and if so, for whom? Are there significant differences between interviewing incarcerated and non-incarcerated offenders?

Researchers who have interviewed offenders associated with activities or structures commonly labeled ‘organized crime’, (whether incarcerated, in witness protection programs or on the street, whether active or retired,) are invited to share their experiences and views. Manuscripts must conform to APA style and should stay within the range of between 2,000 and
5,000 words.

Please submit manuscripts in electronic form (MS Word, RTF) by e-mail to Klaus von Lampe (editor@trends-in-organized-crime.net) no later than 15 April 2007.

20 December 2006

Battle against yakuza yielding results

It is no wonder a senior official of the National Police Agency said, "This was an epoch-making year in terms of measures against financial sources for organized crime groups." This year saw the widespread implementation of initiatives to exclude organized crime groups from various fields, such as stock markets, sporting circles and public works contract.

But the measures are just guides to prevent the flow of financial resources to criminal gangs. Ensuring the effectiveness of such systems and investigating illegal income or creating measures to follow up what has already been implemented are currently top agenda items.

At the first liaison conference between the agency and the Metropolitan Police Department held at the Tokyo Stock Exchange on Dec. 8, agency Commissioner General Iwao Uruma, speaking before TSE executives, expressed his determination to rid the stock market from organized crime groups, saying, "Companies that have relations with antisocial powers must be dealt with appropriately."

Behind Uruma's strong attitude are palpable fears that many listed companies have been corrupted by such groups. Six years ago, links between the former president of an online music distribution company listed on the TSE's Mothers Market and an organized crime group were discovered. In May, the former president of a condominium sales company listed on the TSE's Second Section was arrested in a case involving an organized crime boss and illegal registries.

The aim of the conference was to help information exchange to prevent the yakuza from becoming too cozy with companies after companies go public and manipulating their stock prices. A senior official at the agency said, "It means a great deal that efforts have begun to exclude organized crime from fields where they could invest massive capital."

It has been rare until now for organizations in a range of industries to launch campaigns with police support to battle organized crime groups. But this year the central and local governments began concerted efforts to exclude them. One such campaign has been in the public works sector. The government set up a working team in July comprising ministry officials. The team announced a policy to exclude criminal gangs from all types of contracts, including those with principal contractors and subcontractors.

The team is making plans to exclude not only companies that organized crime groups manage directly, but also to cut off funds to the groups themselves and affiliated associations. The policy has already been introduced in construction work orders by all the regional development bureaus of the Construction and Transport Ministry. In May, a construction company in Yamanashi Prefecture that provided such groups with 5 million yen was punished and barred from participating.

This system has been introduced in local governments, and Osaka Prefecture in April decided to punish companies that have exclusively used subcontractors with yakuza connections. In August, a major general contractor was reprimanded when it was discovered it had signed with a subcontractor who was a golfing friend of a yakuza boss.

Ostracizing organized crime groups from public organizations has been late in coming compared with private sector efforts, as the government tried to remain evenhanded and not discriminate against residents and companies. But this year, since the government has confirmed it is targeting organized crime groups as a major tactic in fighting crime, many ministries moved to exclude these groups from receiving government welfare payments, bidding on national land purchases and other interactions with the government.

The NPA has become more active in disclosing information on organized crime groups. It has been more willing to disclose information on whether someone has been a member of such a group, if it is considered in the public interest, but the agency has dragged its feet when such information has been requested.

Since last year, the agency has taken the initiative in clarifying rules on information exchange, and the number of cases has shot up in which the police, without stating reasons, have requested the exclusion of organized crime groups from specified business dealings because the agency said investigations had discovered connections.

Major conflicts between organized crime groups were practically nonexistent this year, and the number of conspicuous illegal acts by such groups has plummeted. Yet the agency fear a backlash against the marginalization of such groups, as people will be lulled into a false sense of security over the dangers of organized crime groups.

The agency also aims to throw a wrench into the yakuza works to prevent them from becoming more finance-based, meaning their ways of obtaining funds would become more tricky and harder to trace.


Climate of acceptance

A yakuza once said: "When there are problems, the police don't act right away, and it takes time and money to hire lawyers. So groups such as ours are needed."

It has been long noted that organized crime groups do not disappear because there are companies and citizens who profit from them or are willing to voluntarily offer support. Organized crime groups are creating systems to absorb massive profits by attacking society's soft spots. It is necessary to change the climate that accepts the existence of underground groups.

"Much of the money collected by organized crime groups will become capital for loan-sharking operations and for the purchase of drugs. That kind of money in turn creates crime and hurts society," a senior NPA official said. It is imperative to eliminate the financial resources of such groups as well as to seize illegally earned money.

The Law for Punishment of Organized Crimes and Control of Crime Proceeds and Other Matters stipulates that illegal proceeds of prostitution and the selling of drugs and weapons may be confiscated as crime-related profits. However, the law is applicable to only to a limited number of criminal activities and fails to fully cover all organized crime.

The most realistic approach is to pin down an organized crime group with tax evasion charges, which can be connected to all illicit proceeds. But up to now, taxes have not properly been imposed on crime organizations.

Daily Yomiuri online, 20 Deceember 2006

16 December 2006

Brazil arrests 75 Rio cops for organized crime ties

RIO DE JANEIRO, Brazil (Reuters) - Brazilian federal agents arrested 75 state police troopers on Friday for links with organized crime in Rio de Janeiro state's high-profile bid to get rid of corrupt cops.

A special federal police unit from the capital, Brasilia, and other cities arrived in Rio to make the arrests jointly with the state police internal investigations department. In the early hours on Friday, they raided a shantytown on the outskirts of Rio where some of the officers accused of involvement in drug and arms trafficking lived. Many others were arrested at their police stations.

A federal police spokesman in Rio de Janeiro said 320 federal agents took part in the operation, which led to the largest number of arrests of police officers in Rio state in one day. "We have to applaud this operation. It has a great symbolic value. By nabbing so many, police send a message to the force that they are being serious," said Julita Lemgruber, director of the Center for Security and Citizenship Studies at Rio de Janeiro's Candido Mendes University. "We hope they don't stop here. We know that all kinds of organized crime blossom because they have some sort of police protection. It's high time to reduce police involvement with drugs and arms trafficking, with car robberies and cargo theft," Lemgruber added.

Lemgruber said Col. Ubiratan Angelo, Rio's next police commander who will start working in January, "is committed to the issue of human rights and the fight against illegal activities within the police force," and expected him to bring at least some improvements.

Human rights groups also accuse Rio police of brutal tactics such as summarily executing suspects in the slums and taking part in death squads. Police in the state kill about 1,000 suspects a year in consequences loosely described as "resistance to arrest," a number comparable to some war zones.

Brazil's second-biggest city, famous for its sandy beaches but also notorious for one of the world's highest murder rates, has over 600 slums, where around 1 million people live. Many of the teeming slums are controlled by powerful drug gangs.

Washington Post Friday, December 15, 2006

CALL FOR PAPERS Prevention of organised crime and corruption: International efforts in post-communist countries.

4th ECPR Conference, Pisa (Italy)
6-8 September 2007

Section: Representing a Crisis: Organised Crime between New and Old Threats (Standing Group
Organised Crime)


Organised and other forms of crime and corruption in post-communist transformation countries are receiving continuing attention on part of international bodies and Western countries, recently increasingly from a security perspective. On a European regional level, in the course of the 2004 EU enlargement, new security concerns have been raised about an expansion of transnational organised crime from Russia and other CIS countries. At the same time, corruption is increasingly viewed as a national and international security issue, as it has been an important factor leading to the colour and flower revolutions in the post-communist world since 1999. Corruption is also said to foster unpredictability in foreign policy-making as well as transnational (organised) crime and terrorism.

This panel discusses how international actors such as the EU or the UN seek to deal with crime and corruption in Eastern Europe, Caucasus and Central Asia (EECCA). Transnational crime prevention is a considerably young, but very significant field of co-operation across West-East dimensions. While it may be too early to assess successes, it is time to address conceptual approaches towards the prevention of crime and corruption in the post-communist region. First, it is vital to examine how respective efforts, expectations, and initial disillusionments may affect the unfolding relations between international bodies and various post-communist countries. Second, scholars need to revisit conceptual challenges of studying organised and other forms of crime, corruption, and terrorism.
Identification of differences and overlaps, synergies and spill-over effects is crucial when seeking to prevent one or the other criminal element, especially in post-communist contexts where old and new characteristics are considerably blurred. The panel seeks to integrate discussions on different international bodies (such as the EU and the UN) and different country cases (including Eastern Europe, South-Eastern Europe, new EU member states) in order to allow for insightful comparative

Deadline for abstracts (max. 300 words): 19 JANUARY 2007

Full papers to be submitted until August 2007

Reimbursement possibilities are managed via ECPR: http://www.essex.ac.uk/ecpr/funding/index.aspx

For applications and further questions please contact the panel chairs:

Diana Schmidt (Research Centre for East European Studies, Bremen),

Holger Moroff (Friedrich Schiller University Jena),

U.N. Panel to Probe Guatemala Mob Crime

A U.N.-backed commission was established Tuesday to investigate rampant organized crime in Guatemala, which authorities say has become a key point of transit for smugglers bringing drugs into the United States. The independent commission, comprised of former prosecutors from outside Guatemala, will have an initial two-year mandate to gather evidence and help build cases against illicit criminal groups. Suspects would be tried in local courts.

Some organized crime groups are believed to be made up of former military members who fought in Guatemala's 36-year civil war that left about 200,000 dead.

Peace accords ended the fighting nearly 10 years ago, but violence and corruption continue. The U.N. has said about 5,000 murders are committed annually in Guatemala, and U.S. officials estimate that three-quarters of all cocaine consumed in the U.S. passes through the country, a key smuggling point between Colombia and Mexico.

"With this agreement, the United Nations is standing by Guatemala as it tries to solidify democracy and the rule of law by exposing and dismantling criminal groups that grew out of the armed conflict," Ibrahim Gambari, the U.N. undersecretary-general for political affairs, said in a statement.

Guatemalan Vice President Eduardo Stein, who signed the agreement with Gambari at U.N. headquarters on Tuesday, said earlier that the integrity of the commission would be guaranteed by prosecutors with "vast experience investigating criminal networks." The commission still must be approved by Guatemala's Congress.

Authorities hope the commission will help beef up the country's criminal justice system, which has been targeted recently by organized crime groups.

The Washington Office on Latin America, a human rights advocacy group, said in a statement Tuesday that criminal elements have terrorized judges, witnesses, prosecutors and human rights defenders in Guatemala over the last several years. The group said six justice officials were assassinated last year and five politicians were killed this year.

A U.N. human rights observer said in August that most violent crime in the country goes unpunished because of lack of investigation. "It's sad to say, Guatemala is a good place in which to commit a murder. Your chances of being committed and punished are staggeringly low," said Philip Alston, the U.N.'s special investigator on extrajudicial, summary or arbitrary executions.

Forbes.com 12.12.2006

08 December 2006

Asian Organized Crime Thriving in Canada

When organized crime is mentioned, what comes to mind for most people is the Italian Mafia. But one of the most powerful and dangerous criminal groups is the Triads, a centuries-old Chinese crime gang that has a strong and ubiquitous presence throughout the world, including Canada.

Triad societies, with their secret initiation rituals and code of loyalty, have long overshadowed Chinese communities around the globe. As with other Asian gangs from countries such as Vietnam, Taiwan, Hong Kong, and Korea, they prey upon their own, often using fear and intimidation tactics as well as outright physical violence.

Thought to be the world's largest criminal fraternity, the Triads, or Chinese Mafia, have a long history in Canada. They initially established operations there in the 1850s, when the Chinese began arriving in North America to build the railroads and work in the goldfields. Many of the migrants—desperate to escape China after the horror of the 1850 Taiping Rebellion in which 20 million died—were brought in illegally by the Triads.

The Triads provided passage to Canada, and those who came had to work for years in low-paying jobs or as prostitutes to pay off their transportation debt, just as the many illegal aliens who have been smuggled into the country do today. Many used Canada as a jumping-off point to enter the United States, again just as they do today. Because the predominantly male Chinese population at the time was either barred from mixing with local women or did not wish to, the Triads brought in women and girls from China, some as young as 12. They also imported opium, the use of which was legal at the time, and ran gambling and prostitution houses. Before long, crime and drug addiction began to spread across the country.

In modern times, in addition to human trafficking and drug smuggling, the Triads are involved in such unsavory practices such as arms dealing, economic espionage, counterfeiting, and money laundering. Hong Kong, home to more than 50 Triad societies totalling hundreds of thousands of members, is a key transit point for the large amounts of Golden Triangle heroin and methamphetamines that flow into North America. The Triads controlled most of the drugs' transportation.

A 2004 Criminal Intelligence Service Canada (CISC) report stated that Asian organized crime presents a major threat in Canada because of its many widespread and well-run criminal operations. CISC said Asian-based street gang violence is on the rise in several cities, and that the street gangs have connections with more sophisticated Asian organized crime groups—in other words, the Triads. At a local level, Asian gangs are involved in a long list of criminal activities: credit card fraud, luxury car theft, prostitution, home invasions, staged vehicle accidents, contract killings, assaults, welfare and employment insurance fraud, drug trafficking, software piracy, loan-sharking, and illegal gaming. While scattered from coast to coast, Asian gangs are most active in Vancouver, Calgary, Edmonton, and Toronto, the CISC report said.

Former diplomat and organized crime specialist Brian McAdam says the Triads often form an alliance with other Asian gangs, such as the Vietnamese. The Vietnamese gangs now largely control marijuana growing-operations in Canada and sometimes collude with Hell's Angels, thought to be British Columbia's largest organized crime group. The Vietnamese gangs, known for their extreme violence and preference of automatic weapons, often take on the dirty work at the street level for the Triad, McAdam says. "Within each Chinese community, there's usually a strong Triad presence controlling and extorting money from the businesses, and if there's drugs, they're bringing them in," says McAdam.

In addition to setting up legitimate companies in Vancouver and other Canadian cities as a front for their activities, McAdam says the Triads have in many cases been successful in compromising members of the police force as well as politicians at the federal and municipal level. He says the leaders of the benevolent societies and the Masonic temples in various Chinatowns are often Triad leaders, who may contribute large political donations as well as promise the vote of the Chinese community.

In 2003, the Asian Pacific Post reported that veteran police Superintendent Garry Clement warned Ottawa in an internal memo of attempts by the Chinese Mafia to make connections with Canadian politicians.

In its International Crime Threat Assessment report, the U.S. government said Asian organized crime in Canada poses a security threat to the United States. The report details how Chinese criminal organizations from Hong Kong, China, Macau, and Taiwan have exploited the country's immigration policies and entrepreneur program, and are using Canada as a base for their operations in the United States. "Canada has become a gateway for Chinese criminal activity directed at the United States, particularly heroin trafficking, credit card fraud, and software piracy," the report stated.

James Dubro, author of Dragons of Crime: Inside the Asian Underworld, says many organized crime gangs smuggle their illegal booty through the native reserves that straddle the Canada-U.S. border in Quebec and Ontario. He says it's difficult for police to do anything about it since those reserves have their own police force which is itself often corrupt. "Everyone uses [reserve land]—the mafia, the bikers, the Triads, the Vietnamese gangs. They all use it for people smuggling, drug smuggling and everything else."

Worldwide, human trafficking is one of the biggest money makers for the Triads. In 2004, the Royal Canadian Mounted Police (RCMP) estimated that 600 to 800 people are brought illegally into Canada each year, and another 1,500 to 2,000 are trafficked through Canada into the United States. While some trafficking victims are pressed into forced labor, most women and children are trafficked for the purposes of sexual exploitation.

Dubro says that because many Hong Kong nationals who moved to Vancouver in the 1980s after Hong Kong was returned to China had links to organized crime, Asian gangs have become the "dominant criminal force" in British Columbia. It was in the 1980s that the Big Circle Boys, a gang largely consisting of former Red Guards who moved from China to Hong Kong after the Cultural Revolution, set up shop in Vancouver.

The Vancouver RCMP said last year that they were shifting their focus to going after the gang kingpins rather than the minor players, and to that end have compiled a list of B.C.'s 20 top crime bosses. But Dubro says when it comes to Asian gangs, because they often have connections in high places and because their most powerful members do not operate at the street level, nabbing the key players is easier said than done. "The big guys are very hard to get."

Epoch Times Victoria Staff
Dec 06, 2006