Fausta's Blog

Must-read article at Deutsche Welle on the upcoming report by The Financial Action Task Force (FATF),
Ecuador emerges as hub for international crime
Ecuador is emerging as a focus for transnational criminal groups, according to US and European officials. Colombian and Mexican drug traffickers as well as Chinese and African human traffickers use it as a business hub.

The Financial Action Task Force (FATF), the inter-governmental body responsible for combating money laundering and the financing of terrorism, is expected at its meeting in February in Abu Dhabi to include Ecuador on its high-risk jurisdiction list at the request of G20 finance ministers.

Why?

Ecuador attracting transnational crime
FARC’s penetration of Ecuador’s government and judiciary, the country’s weak institutions and anti-money laundering laws and its nonexistent anti‐terror financing laws as well as its porous borders with its drugs producing neighbors have turned Ecuador into a place where transnational criminal organizations from Latin America, Russia, China, India and Africa can conduct business, according to a just-released report by the Washington-based International Assessment and Strategy Center (IASC).
…
The report goes on to say that Ecuador is “increasingly attractive for Russian organized criminal groups, both for weapon sales to the FARC and to launder money” and that “Chinese triads, particularly those involved in smuggling human beings, have greatly increased their presence in Ecuador.” The Financial Action Task Force warned in 2007 that Ecuador had failed to comply with 48 of its 49 recommendations on money laundering and terrorist financing.
The officials say the lifting in 2008 of visa requirements for nationals of most countries and the adoption in 2000 of the US dollar as Ecuador’s national currency make it easy for Russian, Chinese, Indian and African criminal organizations to operate in Ecuador.
The dollarization of Ecuador’s economy, lax restrictions on the movement of large amounts of money and some of world’s strongest bank secrecy laws enable the laundering by Russian crime groups of proceeds of Mexican drug and Asian and African human traffickers. A recent study by Quito’s San Francisco University concluded that annually up to $1billion (0.7 billion euros) are laundered through Ecuador. US law enforcement officials say the figure could be substantially higher.
The lifting of visa requirements has allowed Chinese triads as well as Indian and African human traffickers to process people they are trafficking through Ecuador, the Washington institute’s report says. US diplomats say that virtually every non-Latin American immigrant caught since the lifting entering the United States from Central America and Mexico has transited through Ecuador. “They are mostly Africans or Central Asians, which raises security concerns,” one diplomat said.

DW also explains some of the shady financial dealings with Iran, and the corrupt judicial system.

If you are one of the many Americans considering retirement in Ecuador, I urge you to read this article.

In the New York Times, that arm of the vast right-wing conspiracy,
Obama to Return Major Donations Tied to Fugitive

Two American brothers of a Mexican casino magnate who fled drug and fraud charges in the United States and has been seeking a pardon enabling him to return have emerged as major fund-raisers and donors for President Obama’s re-election campaign.
The casino owner, Juan Jose Rojas Cardona, known as Pepe, jumped bail in Iowa in 1994 and disappeared, and has since been linked to violence and corruption in Mexico. A State Department cable in 2009 said he was suspected of orchestrating the assassination of a business rival and making illegal campaign donations to Mexican officials.

First, the Obama campaign denied knowing about Pepe,

When The New York Times asked the Obama campaign early Monday about the Cardonas, officials said they were unaware of the brother in Mexico.

Later, they came to their senses, sort of,

Later in the day, the campaign said it was refunding the money raised by the family, which totaled more than $200,000.

Because,

Pepe Cardona is one of the largest players in Mexico’s violent and tumultuous casino trade. In 2007, he survived an assassination attempt that was attributed to members of organized crime. The State Department cable, which was part of the cache made public by WikiLeaks, said he was suspected of illegally funneling $5 million into Mexican political campaigns in 2006.

As Jazz Shaw puts it,

Cardona appears to be tied up not only in drug smuggling allegations, but bribing public officials in Mexico and the untimely inhuming of one of his “colleagues” in the trade.

Jazz continues,

Jim Geraghty connects the dots and ties Cardona to the drug cartels in Mexico and all of the violence associated with them, bringing us full circle back to Fast and Furious.

At least these guys are courteous enough to tip the administration that supplies their friends with guns so well…

Too bad the Cardonas didn’t belong to the FALN.

UPDATE,
WyBlog calls Pepe “the new Marc Rich“.

UPDATE 2,
via Thomas, Fugitive Obama Fundraiser Linked to Fast and Furious and the Beltran Leyva cartel.

According to Bloomberg News, Obama’s State of the Union address will embrace manufacturing.

You can be sure he will not bring up the 1,200 high-skill manufacturing jobs that will go to Brazil’s Embraer, to which Obama is outsourcing national security:

Yes, the Embraer that is under investigation by the SEC for corruption.

That Embraer.

And,
After giving Brazil a billion-dollar contract, Brazil stiffed Obama on an oil deal.

He went chateau shopping!

Yup, the guy who doesn’t know where the $1.2 billion of clients’ money went, went house hunting, big time.

You can’t make it up if you try:
On Eve of $41 Billion MF Global Bankruptcy Filing, Jon Corzine Was Château Shopping in France

In an exclusive report from three of Vanity Fair’s premier business writers—contributing editors Bryan Burrough, William D. Cohan, and Bethany McLean—the February issue delivers a sprawling account of the personal and professional battles of Jon Corzine, the former Goldman Sachs C.E.O. and ex-politician whose helming of MF Global resulted in a notorious $41 billion filing for bankruptcy and a $1 billion loss in firm equity. According to the piece, for the fiscal year that ended in March 2011, MF Global recorded day-one gains of $85 million on the former New Jersey governor’s risky trades on European sovereign debt and other assets, thanks to an accounting ploy. Because there were barely any expenses associated with such trades, the gains were almost pure profit. “Corzine would later tell investors that he made a $6.3 billion bet on sovereign debt, but the company’s filings made it look like he had a much bigger long position at the end of June 2011—$11.4 billion, offset by ‘short’ positions of almost $5 billion,” Vanity Fair reports. One analyst says: “If those trades had not been there, MF Global would have been forced to sell or go out of business.”

Go read the whole article, at Vanity Fair, that arm of the vast right-wing conspiracy. Be advised you may need a barf bag.

The NY Times has a graph on
Money Laundering at Lebanese Bank
The chart below shows the intricate money-laundering system the Lebanese Canadian Bank used to divert money to the Shiite militant group Hezbollah, according to United States officials.

The report: Beirut Bank Seen as a Hub of Hezbollah’s Financing

At the same time, the investigation that led the United States to the bank, the Lebanese Canadian Bank, provides new insights into the murky sources of Hezbollah’s money. While law enforcement agencies around the world have long believed that Hezbollah is a passive beneficiary of contributions from loyalists abroad involved in drug trafficking and a grab bag of other criminal enterprises, intelligence from several countries points to the direct involvement of high-level Hezbollah officials in the South American cocaine trade.
…
The revelations about Hezbollah and the Lebanese Canadian Bank reflect the changing political and military dynamics of Lebanon and the Middle East. American intelligence analysts believe that for years Hezbollah received as much as $200 million annually from its primary patron, Iran, along with additional aid from Syria. But that support has diminished, the analysts say, as Iran’s economy buckles under international sanctions over its nuclear program and Syria’s government battles rising popular unrest.

Yet, if anything, Hezbollah’s financial needs have grown alongside its increasing legitimacy here, as it seeks to rebuild after its 2006 war with Israel and expand its portfolio of political and social service activities. The result, analysts believe, has been a deeper reliance on criminal enterprises — especially the South American cocaine trade — and on a mechanism to move its ill-gotten cash around the world.

Venezuela plays a part, too,

According to Lebanon’s drug enforcement chief, Col. Adel Mashmoushi, one path into the country was aboard a weekly Iranian-operated flight from Venezuela to Damascus and then over the border. Several American officials confirmed that, emphasizing that such an operation would be impossible without Hezbollah’s involvement.

It doesn’t end there.

Go read the whole thing.

Former French president Chirac convicted of graft, escapes jail time

Popular former French president Jacques Chirac was convicted of graft on Thursday but escaped jail, receiving a suspended two year sentence for running ghost workers at Paris city hall.

The 79-year-old statesman, who was excused from court on medical grounds, was found guilty of influence peddling, breach of trust and embezzlement between 1990 and 1995, when he was mayor of the French capital.

In their ruling, judges said Chirac’s behaviour had cost Paris taxpayers the equivalent of US$1.8-million (1.4-million euros).

Readers of this blog may remember Blacque Jacques sipping piña coladas earlier in the trial; now his lunch money shenanigans while he was mayor of Paris earned him a slap in the wrist while others are in the clink,

He was tried alongside nine alleged accomplices. Two were cleared, but the rest were convicted of helping Chirac run a system at Paris city hall under which political allies were paid municipal salaries for fake jobs.

The city of Paris, which is now run by a Socialist mayor, dropped a case for damages over the case after Chirac and his UMP party agreed to pay 2.2-million euros to cover the embezzled funds.

Chirac — who lives in a luxury Paris flat overlooking the Seine near the Eiffel Tower paid for by the family of the late former Lebanese prime minister Rafiq Hariri — repaid 500,000 euros out of his own pocket.

He was convicted of hiring members of his political party for non-existent municipal jobs, using the civic payroll to employ his own campaign staff.

In all, 19 fake jobs were created in Paris and its suburb Nanterre between 1990 and 1995, ahead of Chirac’s successful presidential bid.

Several people were convicted in connection with the ghost worker case in 2004, including Juppe, who was found guilty of mishandling public funds but is now a key figure in the government of Chirac’s successor Sarkozy.

C’est la vie, mon mes amis.

LATIN AMERICA
India Eyes Latin America
The South Asian giant’s burgeoning presence in the Western Hemisphere is unambiguously good for both Latin America and the United States.

ARGENTINA
Cristina, Guevara, la patria liberada

Big Fears on Big Food Prices

BOLIVIA
Evo Morales llegará a Cuba el domingo para reunirse con Raúl Castro
El presidente de Bolivia, Evo Morales, llegará el domingo a Cuba para una visita de trabajo de dos días durante la que se reunirá con el gobernante Raúl Castro, informó este sábado un comunicado oficial.

BRAZIL
Bush, Bismarck and Brazil

Brazilian politics
A packed chessboard

The Road to Rio is America’s Road to Ruin

CHILE
Rescued Chilean miner in rehab

New Chilean telescopes push the boundaries of astronomy
With two gigantic telescopes coming in the next decade, Chile is gaining a reputation as one of the best places in the world for stargazers.

COLOMBIA
Libyan rebels execute 10 Colombians thought to be FARC mercenaries

Paramilitaries and Colombia’s government
The biggest fish so far: Jorge Noguera

Six Months for Letting Grandma Do His Laundry

Colombian mountain cyclists try to pedal out of poverty toward glory in Europe

CUBA
Bill Richardson went to Cuba to intercede on Alan Gross’ behalf and was resoundedly turned down: Alberto de la Cruz writes on how the Obama State Dept. authorized Richardson to offer concessions in exchange for Gross

Taxes in Cuba
Get used to it
The Castros’ subjects get acquainted with that other sure thing

Trips Back to Cuba Draw Fire

GUATEMALA
Big Labor’s Yanqui Imperialism
The U.S. trade representative is trying to deny due process to Guatemala in defiance of free-trade agreement rules.

MEXICO
Good news: ATF’s Gunwalker may have helped Mexican cartels buy rocket launchers

Cloward-Piven: The Ultimate Goal of Gunwalker?
It’s hard to think of a more logical reason for Gunwalker to exist.

Free speech in Mexico
Be careful what you Tweet

PANAMA
Time for Another Reminder

Panamanian politics
With friends like these

PUERTO RICO
Masked intruders rob casino in Puerto Rico

Officials: Teen goes on rampage at Puerto Rico school, stabbing 37 classmates with needle

VENEZUELA
Venezuelan government providing support to terrorist Carlos the Jackal

Human Rights Court rules in favor of Leopoldo Lopez, slaps Chavez tactic of illegally disqualifying opposition

Chavez is in Cuba for a 5th round of chemo, instead of going to the UN this week. He claims it’s “the last round.” Evo Morales stopped in Caracas and they both flew together.

Since Chavez is not going to NY, Mahmoud Ahmadinejad will visit him in Caracas on his way back from the UN Assembly.

Smoke and Mirrors in the Chavez Revolution: Oil and Research

This is the lawyer of Chavez defending what cannot be defended

The week’s posts:
The AFL-CIO vs. Guatemala
Mexico’s cartels vs bloggers, part 3
Mexican cartels now going after bloggers, part 2
Venezuela to withdraw from the International Centre for the Settlement of Investment Disputes

At The Green Room,
Mexican cartels now going after bloggers

Remember Jacques’s City Hall escapades?

[In March of 2005] I posted that 47 people were on trial for rigging public works contracts (ah, a whiff of New Jersey chez le Seine?) and that on Nov. 2002 Chirac had avoided prosecution over his exhorbitant food bills (which avearaged 600 euros (£420) a day on average between 1988 and 1995) from back when he was mayor of Paris because the statute of limitations had ran out.

Jacques, as you may recall, also had shenanigans in the Clearstream affaire, Jacque’s part in a coup in the Comoros, Jacques’s own secret service mentioned above, and the Chirac connections in the Oil-For-Food scam.

Jacques is now on trial for embezzlement charges during his tenure as mayor of Paris – this time the statute of limitations apparently didn’t run out?

But fear not, Jacques will not be unduly stressed: French Court Lets Chirac Skip Trial, because he had his physician sign something saying Jacques is (conveniently) suffering from memory loss.

Maybe he ought to lay off the hooch,

Mr. Chirac was seen in good shape this summer, sipping piña coladas in Saint-Tropez or eating mussels with a beer in Brittany.

Sing it, Jimmy!

According to the New York Times,

Representative Anthony D. Weiner has told House leaders and friends that he plans to resign his seat after coming under growing pressure from his Democratic colleagues to leave the House, said a top Democratic official and two people told of Mr. Weiner’s plans.

James Taranto, however, looks at a different aspect,

Will Mrs. Weiner Fire Mr. Weiner?
House Democrats are anxious to be rid of Anthony Weiner the Tumid Tweeter, National Journal reported yesterday:

They conceded that their best strategy for getting to that point is hoping that Weiner’s wife will persuade him to go.

“We’re hearing he might resign in a couple of days,” said Rep. Carolyn McCarthy, D-N.Y. “He’s waiting for his wife to come home. That’s what we’re hearing from his friends.” . . .

A senior Democratic aide said there was much anticipation expressed by members–if not desperation–that Weiner might be talked into resigning by his wife, Huma Abedin, later this week.

Right, just like Mrs. Weiner’s boss, Hillary Clinton, persuaded her husband to quit politics amid a sex scandal.

Why in the world would the Dems expect Mrs. Weiner to press her husband to resign, thereby cutting the household income in half? Even if the marriage fell apart, the prospect of collecting alimony and child support would leave her with a continuing interest in his gainful employment.

Is Mrs. Clinton threatening Mrs. Weiner’s employment or advancement in order to pressure Mr. Weiner to resign? That’s the only way in which this plan would make sense.

Actually, no, that is not the only way: Another way is for Weiner to be offered a job with an organization or individual(s) who support the Democrats enough to guarantee him enough salary and benefits to make his resignation worthwhile. You can bet there’s a deal in the works, if not already consolidated.

Stacy says today is the day Weiner resigns. UPDATE: The Fix confirms it.

1. Violence and Calderón:
Violence increases pressure on Calderon (emphasis added)

In yet another case of alleged police complicity in murder, authorities found the bodies of four men detained three weeks ago in the border city of Ciudad Juarez. The men disappeared in the system after they were arrested by a special forces unit of municipal police. Their bodies, showing signs of torture, turned up in the high grass at a ranch Wednesday.

Four years into his U.S.-backed, military-led war against drug cartels, Calderon’s government is struggling to make good on promises to transform the state and local police forces, whose officers are often ill trained and poorly paid. These same units often work for crime mafias and drug traffickers. Calderon’s opponents in the Mexican congress have blocked his efforts to place local police under state control.

Authorities searching shallow pits in San Fernando, about 90 miles south of Brownsville, Tex., said they found 23 more corpses Thursday, bringing the total to 145 since the first were uncovered last week.

The locations highlighted above bring me to
2. The Threat Just Inside Our Door

National Security: The Defense Department warns that the cartels making Mexico a war zone are operating easily here too. And a secret U.S. report leaked in Mexico warns of even worse. So why isn’t anyone talking about it?
…
“The drug trade is inherently associated with creating instability” and is “often a localized funding source for insurgent and criminal groups.”

As for Mexico’s cartels, he [William F. Wechler, deputy assistant secretary of defense, on his testimony last Tuesday to a Senate armed services subcommittee on emerging global threats] said they operate in Atlanta, Chicago and Detroit. Amazingly enough, that was an understatement.

According to an internal Justice Department report leaked to Mexico’s El Universal this week and available only in Spanish, Mexican drug-trafficking organizations have affiliates in at least 1,286 U.S. cities, with 143 reporting directly to cartel leaders.

Translating from the El Universal report, InsightCrime.com said the Sinaloa Cartel, run by Mexico’s biggest kingpin, Joaquin “Chapo” Guzman, operates in 75 U.S. cities.

The Zetas, a separate organization known for beheadings, operate in 37. Then there’s the Gulf Cartel operating in 37 cities, the Juarez Cartel in 33, the Beltran-Leyva Organization in 30, La Familia in 27 and the Tijuana cartel in 21.

That would explain why Phoenix has seen beheadings, Las Vegas has seen child kidnappings, Los Angeles has seen freeway shootings and both El Paso and Brownsville, Texas, have seen the murder of American college students.

There’s a lot of money behind all this violence, and the money has to be laundered. Here is a post on trade-based money-laundering,
On Washing Dirty Cash

For what it’s worth, the most notorious money-launderers in Torreón, at least according to the word on the street, were also really successful businesses, especially nightclubs and car dealerships. There were a couple that were always empty yet stayed open for years, but more common were the ones that would have made money with or without the dirty cash flowing through. I can only imagine the huge volume of legitimate sales makes it harder to identify a place as a money-laundry.

Once the money is “clean”, it pays for a lot of politicians’ favors.