The U.S. intelligence community is near completion of a major assessment of the national security threat posed by international organized crime, according to administration officials and experts.
The National Intelligence Estimate, which could be finished as soon as January, was conceived more than two years ago to address the dangers posed by Eurasian criminal groups’ suspected infiltration of energy and other strategic markets.
But its focus broadened over time to include a wide swath of criminal syndicates and issues, from drug-trafficking by Mexican cartels to the relationship between terrorism and organized crime, the officials and experts said.
“Globalization has done great things for organized commerce, but it’s also helped organized criminal groups to advance as well,” said one senior Justice Department official, who spoke in general terms about the threat.
The threat was underscored in recent weeks, as reports emerged of an FBI investigation into a major cyberattack on Citibank Inc., which Citibank denies. And the Justice Department announced drug charges in New York against alleged Al-Qaeda associates arrested in Ghana during a Drug Enforcement Administration sting.
NIEs are produced under a classified process and carry the full weight of the U.S. intelligence community’s judgment. The existence of the NIE on international organized crime has not been previously reported.
The assessments are compiled by the National Intelligence Council, a research arm of intelligence community that reports directly to Director of National Intelligence Dennis Blair. The NIC incorporates in its estimates expertise from inside and outside of the federal government.
The estimate’s focus expanded over time as more agencies sought to reap the benefits of inclusion, including increased funding and more say in policy direction. In this case, the departments of Homeland Security, Justice, State and Treasury contributed to the NIE, the officials said. The National Intelligence Council is expected to release a public overview of the threat assessment, increasing its visibility and impact, experts say.
“I think it’s going to open this field up to some serious academic research and funding,” said Louise Shelley, director of the Terrorism, Transnational Crime and Corruption Center at George Mason University. “We’re going to be focusing on a whole range of issues that we haven’t thought enough about, and connecting the dots on other issues.”
A sensitive subject: Russia
One effect of broadening the NIE is that it allows the Obama administration to sidestep the diplomatically sensitive issue of Russia, where authorities have long suspected that the tentacles of organized crime reach into the government.
In 2008, then-Attorney General Michael Mukasey gave a speech that identified as the top security threat organized criminals who control significant positions in the global energy and strategic materials markets, threatening U.S. geopolitical interests.
He never mentioned Russia. But as an example, Mukasey pointed to Semion Mogilevich, who is thought to be at the pinnacle of Russian organized crime and is said to have influence over large portions of the natural gas industry in former Soviet-bloc states. (Mogilevich is wanted in the U.S. on racketeering charges, and the FBI recently placed him on its Top Ten Most Wanted list.)
Russian control of energy supplies and transport networks is a security issue for the European Union, which relies heavily on Russian natural gas. But Russia controls the spigot for pipelines that service Central and Western Europe through the former Soviet state of Ukraine. Twice since 2006, Russia has cut off gas to Ukraine in payment disputes, affecting EU supplies.
Of further concern to intelligence analysts is the murky ownership of some middleman companies crucial to European energy supplies.
In 2006, the Wall Street Journal reported that the Justice Department’s organized crime unit was investigating the ownership of a Ukrainian energy trading company named Rosukrenergo AG, half owned by Russian state company OAO Gazprom.
In response to U.S. concerns about who ultimately controlled Rosukrenergo, company representatives met with the DOJ in Washington to disclose the ownership stake of a Ukrainian businessmen with ties to Mogilevich – the suspected organized crime figure on the FBI Most Wanted list, the Wall Street Journal reported.
There’s also the case of William Browder, a U.S. native and British citizen who founded Hermitage Capital Management, once the largest foreign investment fund in Russia but now accused in Russian courts of tax evasion.
Hermitage has denied evading taxes. It has countered with allegations that a government-affiliated “criminal enterprise” siphoned off $230 million in taxes paid by Hermitage units. Browder has retained the law firm of former Attorney General John Ashcroft to investigate.
Hermitage has filed an application for judicial assistance in the Southern District of New York federal court, asking the U.S. to compel access to information it says it needs to defend itself in Russia.
In a recent declaration filed in the case, Neil Mickelswaithe, a British solicitor and outside counsel to Hermitage, said the fund is the victim of a “criminal enterprise” in Russia spanning senior offices of the Russian Interior Ministry, the Russian Federal Security Service (the successor to the KGB), senior Russian tax officers, and certain Russian court judges and “numerous private individuals in Russia, some of whom have previous criminal convictions.”
U.S. authorities have long suspected billionaire Oleg Deripaska, one of Russia’s most powerful tycoons, of having ties to Russian organized crime. Deripaska, who made his fortune in the post-Soviet aluminum industry, is close to Russian Prime Minister Vladimir Putin, often traveling with him abroad. He presides over a business empire that spans metals, finance and construction.
Deripaska, who has denied any ties to organized crime, had been barred entry to the U.S. for years. But recently, the FBI made secret arrangements to allow him into the country to seek his assistance in an ongoing criminal probe, the Wall Street Journal reported. In two visits to the U.S. this year, Deripaska also met with executives of Morgan Stanley and Goldman Sachs Group Co.
Putin and other Russian officials have raised the visa issue with their U.S. counterparts, and in the past Deripaska hired high-powered Washington lobbyists — including former Senate Majority Leader Bob Dole (R-Kan.) — to make his case for entry into the U.S.
New approach more measured
The Obama administration, in contrast, has been careful not single out any country or group. Deputy Attorney General David Ogden, in a speech and in interviews given at the Interpol General Assembly in October, noted continuing threats posed by Mexican drug cartels, South Asian heroin-trafficking syndicates, and traditional crime families from Asia and Eastern Europe.
Ogden made no mention of strategic markets. The apparent shift in message is reflected in the intelligence estimate, officials said.
Under Mukasey, the Justice Department pushed for a finished product before President George W. Bush left office. After a draft NIE was circulated late in the Bush administration, officials in the departments of Homeland Security, State, Treasury advocated a broader sweep, officials said. The recommendations were ultimately passed on to the Obama administration.
“When the Justice Department first started working on the estimate, there was much more focus on energy issues,” said George Mason’s Shelley, who was first contacted in March by government officials involved in drafting the estimate.
“They asked me what I thought was wrong with it, and I told them they needed to broaden the scope and the geographical range. There’s a tendency to stovepipe too much. When you broaden the scope, you are able to see the diversity of the problem and the relationship among
the different aspects of transnational crime,” she said.
The Obama administration has been actively highlighting fronts in the battle against international organized crime.
In November, the State Department and Immigration and Customs Enforcement co-hosted a symposium in Honolulu. The event drew attention to criminal networks that span East Asia, the Pacific and Latin America — and that engage in a broad range of criminal activity, including drug, gun and human trafficking, money laundering and corruption.
Earlier this month, officials from the departments of Commerce, Homeland Security and Justice, as well as the White House, met with entertainment industry executives to focus on intellectual property crimes. The connection between piracy and organized crime is
well-documented, particularly in Asian countries such as China.
At the event, billed as the first of its kind, Attorney General Eric Holder called on the international community to respond.
“This is a problem that the United States cannot solve by itself,” said Holder. “We want to confront these nations, quite frankly, where too much of this occurs.”
Narco-trafficking also a danger
Violent Mexican cartels, responsible for thousands of killings south of the border, have emerged as a singular threat. Their vast drug-trafficking networks reach deep into the U.S., and law enforcement officials fear a scenario in which the cartels rent their smuggling routes to terrorists.
“If you were to ask me what is the biggest organized crime threat, I would say it’s more the cartels in general and other organized crime syndicates engaged in narco-trafficking and other illicit activities,” said David Luna, director for anti-crime programs at the State Department’s Bureau for International Narcotics and Law Enforcement Affairs. “They’re not just in our backyard, they’re actually in the U.S.”
The link between terrorism and crime is also of growing concern, officials said. The case of the three alleged Al-Qaeda associates charged in New York, who are believed to be in their 30s and originally from Mali, appears to show a direct link between the terror group and drug traffickers. Authorities long maintained that Al Qaeda and the Taliban profit from the heroin trade in Afghanistan. Michael Braun, who retired as DEA’s chief of operations last year, told The Associated Press the case was “the tip of the iceberg.”
The intelligence community’s interest in international organized crime dates back more than a decade. In the mid-1990s, intelligence officials began work on a separate estimate, with the help of the FBI and other law enforcement agencies, said Jim Moody, a former FBI Deputy Assistant Director who oversaw organized crime investigations.
The estimate, he said, “helped get rid of a lot of barriers to sharing information” between the intelligence and law enforcement communities and set priorities for developing intelligence on international criminal groups.
But its impact was curtailed by the events of Sept. 11, 2001. “Given the trauma that the country faced after the 9/11 attacks, international organized crime was relegated understandably to a second-tier national security priority” as the Bush administration redistributed resources to deal with terrorist threats, the State Department’s Luna said.
Officials said they hoped the estimate would cement international organized crime as top national security priority, motivate agencies to develop stronger policies and make an argument for increased funding.
Jay Albanese, former chief of the International Center at the National Institute of Justice, the research arm of the Justice Department, was cautiously optimistic.
“Estimates are a mixed bag,” he said, adding that international organized crime is neither easily quantified, nor easily defined.
“This puts those of us in the crime businsess at a severe disadvantage,” said Albanese, a criminologist and professor at Virginia Commonwealth University. “It’s very diffcult to say with any degree of accuracy how much we should be focusing on human-trafficking versus arms-trafficking.”
Mary Jacoby contributed to this report.