Illegal Drugs and Transnational Organised Crime

Author: Nyman Gibson Miralis

Subject: The Illicit Drug Market and Transnational Organised Crime

Keywords: Europol, illicit drug market, Organised Crime Groups (OCGs), transnational crime, darknet, encryption, bitcoin, terrorism funding, money laundering

 

Europol, the European Union Agency for Law Enforcement Cooperation, is the EU’s law enforcement agency and assists Member States in their fight against serious international crime and terrorism. We investigate some of the key findings in the recent Europol report titled ‘How Illegal Drugs sustain Organised Crime in the EU’.

 

The European drug market

More than one third of European Union (EU) criminal groups are involved in the illicit drug market, making this the largest criminal market in the EU with an estimated value of at least EUR 24 billion a year1. These immense profits allow Organised Crime Groups (OCGs) to sustain and develop their criminal enterprises.

Drug crime and organised crime are becoming increasingly transnational in nature due to a number of factors such as the use of technologies that allow illicit drugs to be sold online and payments to be made in anonymous crypto-currencies.

The production of certain drugs is concentrated in specific geographical areas, but this production has far-reaching global effects. Colombia for example, is the largest producer of cocaine in the world and production has intensified in recent years following a peace agreement between the government of Colombia and Revolutionary Armed Forces of Colombia – People’s Army (FARC) insurgents. This unprecedented increase in cocaine production has resulted in intensified global trafficking activity.

More than 75% of the OCGs involved in the drug trade are responsible for the trafficking of more than one type of drug, while 65% are simultaneously involved in other criminal activities such as the trade in counterfeit goods and migrant smuggling, which is a transnational crime by nature.

 

What technologies are utilised by OCGs in the drug trade?

Advanced technologies have allowed OCGs to maximise their production output, utilising laboratories with advanced chemical equipment to produce synthetic drugs on an industrial scale, as well as utilising professional growing equipment such as climate control systems, CO2 and ozone generators in the cultivation of cannabis.

The use of encrypted communications and payments in crypto-currencies such as Bitcoin make it increasingly difficult for law enforcement authorities to identify and disrupt these OCGs.

 

Role of the Darknet in the illegal drug market

The Darknet has emerged as a key platform in the trade of a number of types of illegal commodities including drugs, firearms, child abuse material, counterfeit goods, and fraudulent documents, with up to 57% of Darket activity being drug related.

While it has been assessed that the majority of vendors are lone offenders, it is reported that the top 1% most successful vendors are responsible for over 50% of all transactions on Darknet markets, and are likely transnational organised crime groups.

The proliferation of the Darket as a platform to distribute illicit drugs internationally is due to the anonymity and perceived security by offenders, with payments made in crypto-currencies such as Bitcoin leaving little trace and representing a significant hurdle in the attribution of transactions to specific users.

 

What are some of the key drugs in the European drug market and who are the key global suppliers?

 

New Psychoactive Substances (NPS)

NPS include various substances such as synthetic cannabinoids, stimulants and opioids, simulating the effects of traditional drugs such as cannabis or cocaine and marketed as alternatives to these drugs. Since 2005, 620 new substances have been detected in the EU for the first time2. Initially these substances are not covered by international drug controls, making it easier for transnational criminal organisations to traffic them.

NPS are primarily produced in China, with production also occurring in India.

 

Fentanyl

Fentanyl is a highly potent opioid narcotic drug widely used as medicine in anaesthesia, for pain relief, and the immobilisation of large animals. However due to their psychoactive effects such as causing euphoria, they are also used as replacements for heroin and other illicit opioids. While some supply of this drug in the European market has been diverted from legal medical supply, it is also produced specifically for sale on the illicit drug market with the majority of production occurring in China.

 

Cannabis 

Cannabis is by far the most widely consumed drug in the EU, distributed as either cannabis resin or herbal cannabis. Herbal cannabis has increased in popularity in recent years leading to an increase in production and availability within the EU and surrounding countries. Herbal cannabis can be cultivated indoors and many OCGs are investing in cultivation sites, with cultivation materials available internationally online.

Albania is the main source of herbal cannabis trafficked to the EU, while the main source of cannabis resin is Morocco.

 

Cocaine

The trafficking and distribution of cocaine is the most common criminal activity related to drugs among OCGs active in the EU, with an annual retail market in Europe estimated at EUR 5.7 billion.

Cocaine is primarily produced in Colombia, Peru and Bolivia and trafficked to the EU via other South American countries, the Caribbean Sea region and West Africa. Colombia remains the biggest producer of cocaine in the world.

 

Heroin

Heroin continues to be a drug trafficked to the EU in large quantities, with the leading producer/supplier being Afghanistan. OCGs also traffic acetic anhydride, the precursor used for heroin production, in large quantities.

 

How is Terrorism linked to the illegal drug trade?

The trafficking and sale of illegal drugs is believed to be a key source of financing international terrorist activities.  The actors involved in terrorism with links to serious and organised crime use criminal infrastructures to facilitate their terrorism-related activities.

 

What is the role of money laundering in transnational drug crime?

Due to the substantial profits generated OCGs need to launder these proceeds of crime, often utilising professional money laundering organisations. Money laundering is increasingly a challenge for international law enforcement authorities to combat, with criminal networks exploiting the latest technological developments such as crypto-currencies and anonymous payment methods.

 

Conclusion

The market for illicit drugs and other organised crime markets are becoming increasingly transnational in nature due to technological developments and increasingly sophisticated operations. Due to the high profits generated, transnational organised crime groups are able to further develop their other criminal enterprises. Drugs are widely traded online via the Darknet and the use of technologies such as encryption and crypto-currencies allow OCGs to conduct their criminal activities while minimising the potential for detection and prosecution by law enforcement agencies.

 

1 EMCDDA & Europol 2016, EU Drug Markets Report 2016

2 EMCDDA 2017, European Drugs Report 2017

 

Nyman Gibson Miralis specialise in all aspects of international and transnational criminal law. Our expertise includes dealing with the laws and processes surrounding anti-money laundering, bribery and corruption, extradition and mutual legal assistance (MLA), cybercrime, INTERPOL, international asset forfeiture and national security breaches. If you require assistance, contact one of our expert criminal defence lawyers