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18 de Junio del 2021
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Lectura: 30 minutos
18 de Junio del 2021
Redacción Plan V
Smuggling is part of the organized crime network
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The "technical" smuggling is the one that takes place through sea and airports. This crime involves organized gangs that seek to establish a criminal legality in the process of importing and exporting goods. Photo: El Universo

 

The smuggling of goods is nothing more than an expression of how criminal organizations evade the law and formality to make huge profits. Smugglers, drug traffickers, human traffickers, women traffickers, and criminal groups cohabit along this path. The problem is that the country has normalized illegality and informality.

On both the southern and northern borders of Ecuador, smuggling of goods coexists with other crimes associated with transnational crime: human trafficking, illegal mining and gold trafficking, fuel trafficking, trafficking of arms, ammunition and explosives, trafficking of drugs, chemical precursors and other controlled substances, trafficking of migrants, trafficking of timber and wildlife species, hired assassination...

I. From micro-trafficking to money laundering

All these related crimes share perpetrators, accomplices and accessories, as well as trafficking routes, legal or clandestine; but, in addition, the gangs dedicated to these crimes obtain financial resources that they recirculate for their own businesses or in money laundering operations. In many of these crimes, border populations are directly or indirectly involved and the dispute over trafficking zones, routes and territories leads to extortion and violence. The perpetrators are usually irregular armed groups and national or transnational mafias that exploit the informal, vulnerable and precarious situation of the populations both where the crimes are generated and where the illicit products, such as drugs, cigarettes, textiles, etc., are marketed.

However, it is not only a phenomenon that involves borders and the so-called technical smuggling, which is exercised from the customs ports of entry into the country, through irregular operations with legal companies. They are constituted as shell companies and other mechanisms.  Experts say that these are structured transnational groups that establish agreements to carry out illicit operations through front companies and front men.  These groups have secret agreements that are reflected in commercial understandings between private entities and public officials for the shielding and protection of their operations and the use of front men for negotiations in the private and public spheres. The recurrent crimes are the formation of front companies for smuggling, arms and drug trafficking through bribery and extortion, which leads to illicit enrichment and tax fraud.The role of the officials involved in this criminal conglomerate is to exercise power and pressure to protect the illicit operations.  An organized crime organization measures its success by its ability to protect its operations.

THE MOST COMMON CRIMES ARE THE FORMATION OF FRONT COMPANIES FOR SMUGGLING, ARMS AND DRUG TRAFFICKING THROUGH BRIBERY AND EXTORTION, WHICH LEADS TO ILLICIT ENRICHMENT AND TAX FRAUD.

In the investigation "Más que plata y plomo" (More than silver or lead), by the Colombian Gustavo Duncan, evidence of how drug trafficking, as an organized crime organization, is an enterprise for the production of power. Defined also as "a risk reduction enterprise" and that, in our Latin American countries, the State and criminal organizations simultaneously share and dispute the imposition of the institutions that regulate society. "The successful drug trafficker is the one who achieves sufficient protection to place merchandise on the market without being captured, killed or expropriated. However, protection is costly. A significant part of the profits go in payments to politicians, police, judges, mafiosi, warlords, guerrillas and other actors who have enough power to jeopardize the drug traffickers' activities, but at the same time have the capacity to protect them," Duncan said in an interview with Plan V.

Researchers Alvarez and Zambrano point out that "the tendency of transnational crime networks is to meet at common points or nodes; and it is through the interweaving of these nodes that their criminal activities are facilitated, infiltrating all spheres, from the economic, social and political, in such a way that they are strengthened and the intervention of the State becomes even more complex".

For their part, military experts Carlos Álvarez and Carlos Rodríguez, in their research Criminal Ecosystems: habitats for convergence and deviant globalization, argue that "the criminal ecosystem is the scenario in which illegal actors, civilian population and other actors converge in the same territory and form a series of interdependent relationships that alter the existing balance and even generate hierarchies".

Renato Rivera-Rhon and Carlos Bravo-Grijalva, FLACSO researchers, in their article Organized Crime and Value Chains: Ecuador's Strategic Rise in the Drug Trafficking Economy, argue that "any illicit economy is understood as a set of activities linked to the production and sale of illicit commodities. Their price is set according to a supply and demand relationship, in which various transportation and distribution strategies are established through illicit means. According to this supply and demand relationship, the organizations interact in a constant process of dispute over territories and market niches. In fact, production and consumption, according to Rivera Vélez (2017), cannot subsist without the consent of the State. This is how power relations arise through the regulation of economic activities between organizations, translated through violence, or through the interaction between control entities and organized crime."

Luis Carlos Córdova, Doctor of Jurisprudence at the Central University of Ecuador, PhD from the University of Salamanca and researcher of the so-called "criminal legality", argues that there is a "political dynamic of criminal governance that has been operating in Ecuador for some time. Its protagonists are Organized Criminal Groups (OCGs) inside and outside the country that have taken root locally and seek to monopolize the illicit markets in which they compete. But to achieve their purpose, they need to obtain some kind of protection from the political power and its security agencies (Police, Armed Forces, Judiciary), as well as social roots in the localities where their members operate (generally suburban and marginal neighborhoods)".

II. Illegal crossings: 250 police officers for 140 illegal passages

The National Border Directorate of the National Police, with 250 men and women at its disposal, has to control almost 3000 kilometers of borders with Colombia and Peru; borders that, besides being extensive and porous, are dangerous, due to the action, especially in Colombia, of residual groups of the FARC guerrilla; but, in addition, illegal migration has made control activities more difficult, with the impossibility of increasing the number of personnel. Police and Border Patrols have identified no less than 61 illegal crossings on the border with Peru, and 79 crossings on the border with Colombia.

Police Colonel Pablo Ramos Narváez, director of Frontiers, tells Plan V that the products they have confiscated most as contraband merchandise in 2020 were, in that order: cigarettes, biosecurity supplies, medicines, textiles, perishables, kitchen utensils, beauty items.

Cigarettes are the "star product" of smuggling, says the colonel. It is a product that has a profitability of 4 to 1, is easy to transport, does not get damaged, does not expire and is easier to enter than a bottle of liquor, for example. This is only in the border crossings, because by law the Police cannot be in the so-called primary zones or air and seaports, a task that corresponds to the National Customs Service.

Members of the Border Directorate of the National Police in various control activities in the border areas with Peru and Colombia. 

POLICE COLONEL PABLO RAMOS NARVÁEZ, BORDER DIRECTOR, SAYS THAT THE PRODUCTS MOST CONFISCATED AS CONTRABAND MERCHANDISE IN 2020 WERE, IN THAT ORDER: CIGARETTES, BIOSECURITY SUPPLIES, MEDICINES, TEXTILES, PERISHABLES, KITCHEN UTENSILS AND BEAUTY PRODUCTS.

Intelligence reports highlight the massive use of motorcycles in border areas for goods and human trafficking activities.

Biosecurity products, supplies and medicines are those that appeared in 2020 and so far this year, as a result of the pandemic: masks, alcohol, among others. The most common medicines entering the country are Colombian paracetamol, which has no sanitary registration. But there are not only this type of supplies.  A strategic analysis of the Ecuadorian intelligence agencies alerted that "in Colombia there have been detected cases of people who send publicity assuring the availability of vaccine doses and in order to have access to them it would be necessary to pay. In Panama, a Chinese product sold as a vaccine has been identified. Authorities do not discard that this group is attempting to enter the product to Ecuador, Colombia and Peru".

For Colonel Ramos, the correlation between contraband and organized crime is evident. It is the operation of gangs with many connections; and proof of this is that, despite the borders being closed and militarized due to the pandemic, smuggling is growing. "We cannot rule out the possibility that controlled substances are entering through the crossing points. The border is permeable and extensive, in some places there is only a visual separation. The crossings are still active, but our operations on the northern border are focused on detecting the passage of controlled substances in a joint work with the National Antinarcotics Directorate, because this crime is related to the internal security of the country".

The officer says that for the type of contraband that enters Ecuador, it is clear that it is a criminal organization, but whose center of operations is in the interior of the country. There is informality for the purchase and sale of these products. He gives as an example the contraband cigarettes that are smuggled as micro-trafficking, but there is a market in Quito, where most of them are sold, which is receiving these products to distribute them and this is an organization in full operation. Is it only up to the National Police to carry out this control? No, answers the Border Director: it also includes Health, SRI, SENAE, but a legal regulation is needed to do a better job.

A smuggler can cross the border as many times as he wants, because if he does it with less than ten minimum vital salaries (USD 4,000) it is a contravention, not a crime. Therefore, the control authorities can only confiscate the product, but they cannot register or follow up on the most persistent smugglers. This makes it easier for smuggling to become a way of life on the border, because people are not intercepted by the police, only the merchandise. That situation motivates people to continue smuggling.

One container of contraband covers almost the entire volume of merchandise that the border police can recover in a whole year. In the fight against smuggling, there are several aspects to be identified, among the first, says Colonel Pablo Ramos, is education. Then there is the economic problem: buying in Ipiales, Colombia, means a price difference three times cheaper than in Ecuador.  One way out is that Ecuadorian border areas should have an economic benefit, to prevent dollars from going to Colombia to buy products.

Part of the merchandise captured in the fight against smuggling. Photo: Diario El Telégrafo

ONE CONTAINER OF CONTRABAND COVERS ALMOST THE ENTIRE VOLUME OF GOODS THAT THE BORDER POLICE CAN RECOVER IN AN ENTIRE YEAR.

On the educational issue there are people on the borderline who do not even know that what they are doing is a contravention or a crime. This has been a way of life and a cultural identity for several generations. One solution, says Colonel Ramos, is for all state institutions to come together to attack this problem. There are no thematic roundtables on the border, there is no commitment from the institutions. The approach is merely repressive, avoiding entering into the social, economic, labor and cultural issues, which are fundamental axes of the problem. An integral approach is required.

The National Police, says the Border Director, must be able to operate on the so-called primary line. It cannot now verify at ports and airports. The law only allows SENAE to do that job, and that power can only be given to it by the new anti-smuggling law being processed in the Assembly.

For the time being, micro-trafficking continues to be the most efficient method of smuggling, with shipments not exceeding ten minimum wages in value.  But this creates a problem because the SENAE experts do not have a general table that identifies the values of the merchandise. For now, it is left to the good judgment and discretion of the appraisers.

III. Intelligence findings: smuggling opens the way for other crimes

Northern Border: massive trafficking is by motorcycle.

Through the same clandestine passages through which the contraband passes, a human trafficking network is operating on the border of Tulcán, with the purpose of transporting people to Huaquillas. This network would charge USD 400 per person. In turn, there would be a network of coyoteros, who would charge USD 30 to allow the entry of foreign citizens through unauthorized crossings.

Regarding smuggling, in September 2020, 1,210 gallons of gasoline were seized in Sucumbíos, which would have been destined for Colombia. At the same time, a clandestine refinery was detected. This refinery took oil directly from the pipeline. Ecuador also allegedly participated in the black market of Ivermectin.

On December 14, 2020 there was a blockade of the Ipiales-Rumichaca road by Colombian protesters, alleging that the border closure would be affecting foreign trade with Ecuador. They demand the reactivation of the binational viaduct for economic reactivation.

Illegal mining activity in the Northern Border of Ecuador is a multidimensional and multicausal phenomenon that has been increasing in recent years, as well as the social problems and environmental impact that this activity generates due to the non-technical extraction of minerals, lack of technology and lack of control systems. Illegal miners in the northern border have focused their activities in the cantons of San Lorenzo and Eloy Alfaro (Esmeraldas); Tobar Donoso, Lita (Carchi) as well as Buenos Aires (Imbabura). There are 485 legal mining concessions in the border provinces of Esmeraldas, Carchi, Sucumbíos and Imbabura. Of these, 60 are for construction materials, 97 for metallic mining and 14 for non-metallic mining. There are 29 projects in exploitation status, 4 in advanced exploration and 64 in initial exploration status.

For smuggling at the border, there are 38 informal crossings and 34 informal crossings.  The good condition of the different roads and highways that cross the northern zone facilitate the mobilization and clandestine activities of the suppliers, who use various methods such as backpackers, pickup trucks, motorcycles, and alternate routes to outsmart the control authorities.

Motorcycles have been used to cross Ecuadorian citizens into Colombian territory through border farms to make purchases in Ipiales, the costs vary between USD 1 and USD 5 depending on the merchandise they pass through. Operations have been carried out where motorcycles with Colombian and Ecuadorian license plates have been seized.

Police and Customs units are deployed in Tulcán, Carchi, carrying out seizures. Photo: El Universo

THERE HAS BEEN EVIDENCE OF THE USE OF MOTORCYCLES THAT CROSS ECUADORIAN CITIZENS INTO COLOMBIAN TERRITORY, THROUGH BORDER FARMS, TO MAKE PURCHASES IN IPIALES, THE COSTS VARY BETWEEN USD 1 TO USD 5 DEPENDING ON THE MERCHANDISE THAT PASSES THROUGH.

Authorities have detected human trafficking; trafficking of arms, ammunition and explosives; trafficking of fuel and chemical precursors for cocaine production; food and uniform supply; drug trafficking and trafficking of consumer goods.

In human smuggling and human trafficking, irregular crossings have become more common, mainly in the province of Carchi, as a result of the border closures due to the COVID-19 pandemic.

Since 2020, motorcycles have become common on Ecuador's northern border. This means of transportation has been used for criminal activities such as transporting illegal materials and smuggling migrants.

The situation is worrisome due to all the risks involved in these actions. People attempting to cross through informal crossings are at risk from the moment they come into contact with coyoteros or smugglers, as they may be swindled. The path to be taken can be extremely dangerous, including environmental difficulties or natural hazards, meaning that people can get hurt. Groups dedicated to committing these acts must face legal action.

Between December 24 and 28, 2020, more than 26 motorcycles were detained, most of them without papers or with false license plates. These were transiting through informal crossings in the northern border of the country, in the "4 Esquinas" sector, in Tulcán. It is presumed that their purpose was to transport migrants and illicit material. Many of these vehicles had been reported stolen in both Ecuador and Colombia.

Most of the motorcycles attempting to move through irregular crossings lack the necessary documentation or are stolen. In addition to contributing to the illegal trade, the objectives of these activities could lead to an increase in crime in the country. There are people who are forced to migrate irregularly because they are victims of forced displacement by the guerrillas, so they must be treated under a support protocol due to their situation.

Due to the permeability of the Ecuadorian border, say intelligence authorities, "irregular armed groups are linked to various criminal activities: drug trafficking, illegal mining, human trafficking, extortion, clandestine laboratories for the manufacture of chemical precursors, among others.

The Southern Border: Illegal Mining and Violence

The extension of the border between Ecuador and Peru is 1,623.69 Ms and includes seven Ecuadorian provinces: El Oro, Loja, Zamora Chinchipe, Morona Santiago, Pastaza, Orellana and Sucumbíos. In Peru, there are five provinces: Tumbes, Piura, Cajamarca, Amazonas and Loreto.

In the Amazon sector, the central problem is generated around illegal mining, wildlife crime and the interaction that exists between indigenous communities and authorities.

In the southern sector, the central problem is a spike in violence rates due to the control of territory between gangs dedicated to smuggling goods and related crimes, which directly and/or indirectly involve the sector's population. Illegal mining and smuggling are part of their way of life.

Regarding mining, there are two large-scale or so-called "strategic" metallic mining projects in the southern border.  Fruta del Norte and Mirador located in Zamora Chinchipe, which extract gold and copper.

There are 1668 mining concessions in the provinces of El Oro, Loja and Zamora Chinchipe. Illegal mining is concentrated in the provinces of El Oro: Bella María and Portovelo; Zamora Chinchipe: Río Nangaritza and Río Yacuambí; in Loja: La Tingue, De La Cruz, Santiago and El Valle.

There are 64 unauthorized crossings in the border provinces; the province of El Oro concentrates the largest number of fuel seizures into Peru.

In Zamora Chinchipe, in the Cordillera del Condor mountain range, gold and copper mineralized material is trafficked through clandestine passages that are also used for other forms of trafficking and smuggling. Photo: El Universo

The main activity in the area is the smuggling of fuels or CLDH. Due to illegal mining and CLDH smuggling through 22 unauthorized crossings, the province of El Oro leads the statistics for seizures and arrests in the southern border.

In 2020, 3,015 gallons of CLDH have been seized in the provinces of El Oro, Zamora Chinchipe and Loja.  There is recruitment of CLDH service station attendants for the commercialization of hydrocarbons for smuggling. There is high profitability for criminal organizations that use subsidized CLDH for smuggling (automotive sector). There is a high level of social conflict for the control of the transport, diversion, misuse and smuggling of hydrocarbons along the border. And the financing of criminal organizations for the security of CLDH smuggling.

In 2019, the Ministry of Finance reported that the economic damage to the State in border provinces was approximately USD 212 million annually, of which USD 119.08 million occurred in the southern border.

IN 2019, THE MINISTRY OF FINANCE REPORTED THAT THE ECONOMIC DAMAGE TO THE STATE IN BORDER PROVINCES WAS APPROXIMATELY USD 212 MILLION ANNUALLY, OF WHICH USD 119.08 MILLION OCCURRED IN THE SOUTHERN BORDER.

The Ministry of Finance calculated the consumption of gallons per person in the border provinces of Carchi, Esmeraldas, Sucumbíos, El Oro, Loja and Zamora. If multiplied by the number of inhabitants, it is calculated that in these five provinces about 33.4 million gallons per month are consumed versus the average for the country which should only be 23.9 million, the difference is 9.5 million gallons that should not have been consumed.

IV. Informality and poverty, the breeding ground

The growth of informality in Ecuador, since before and during the pandemic, is one of the most serious deviations of economic activity. The latest data, from September 2020, show that only 3 out of every 10 people working in Ecuador have an adequate job. That is, people who have a formal job, by contract, with at least 40 working hours and enjoy all the rights to which they are entitled by law.

The rest are in conditions of inadequate employment, underemployment or unemployment. According to INEC, inadequate employment includes people with jobs that do not meet the minimum conditions of hours or income and who, during the reference week, earn less than the minimum wage and/or work less than 40 hours per week, and may or may not be willing and available to work additional hours. They constitute the sum of persons in conditions of underemployment, other inadequate employment and unpaid.

The Northern Border

The provinces belonging to the Northern Border maintain employment levels below the national average (-7% on average). The provinces analyzed register an average of 33% of the Economically Active Population (EAP: 780 thousand) classified in Other Non-full Employment (estimated at 257 thousand), which would represent an approximate 13.46% of the total population of the zone.

There are relevant increases in labor statistics with respect to other non-full employment, which could promote the increase of criminal economies in the border zone. The labor situation and economic capacity within these provinces would generate the incursion of people into committing crimes in order to obtain more income for their personal economies. This, together with the high number of illiterate people (which indicates the absence of the state), could lead to the creation of a vulnerable society for the commitment of illegal activities and increase the levels of insecurity in the border area.

The COVID-19 health crisis had repercussions on the labor market in general, with greater effects in Zone 1 due to the closure of the border and thus the decline in trade.

The province of Esmeraldas, for example, has 41.6% of people living in poverty due to lack of income, which leads them to become vulnerable and engage in illegal activities such as drug trafficking, diversion and misuse of hydrocarbons, and illegal mining.

The Southern Border

The provinces belonging to the Southern Border maintain employment levels below the national average (-6.8% on average, excluding the province of El Oro from the calculation).

The provinces register an average of 29.8% of the Economically Active Population (EAP: 560 thousand) classified in Other Non-full Employment (estimated at 167 thousand), which would represent an approximate 13.63% of the total population of the zone. There are relevant increases in labor statistics regarding other non-full employment, which could promote the increase of criminal economies in the border zone.

The labor situation and economic capacity within these provinces would generate the incursion of people into crime in order to obtain more income for their personal economies. The crimes with the highest incidence could be smuggling and illegal mining, along with related crimes.

For a variety of social reasons, the area could become a vulnerable society for the commission of illegal acts and increase the levels of insecurity in the border zone.

The COVID-19 health crisis had repercussions on the labor market in general and could have a greater impact on the border due to the closure of the border and the decline in trade.

  ANALYSIS  

Susana Herrero: the informality of the economy is extremely serious and trafficking in women is its worst expression.

Susana Herrero, Coordinator of the Center for Economic Research at UDLA. PhD in Applied Economics. Consultant for the World Bank, UN and IDB.

The situation of informality is one of the most serious in the current human condition, says Dr. Susana Herrero, coordinator of the Center for Economic Research at the University of the Americas, UDLA. "Smuggling is done because it can be done. Somehow we allow it to be done. The ideal would be to have similar prices for the products we know are being smuggled, which is a good strategy in addition to commercial trade agreements. As much as the police forces control, the borders are very long and that is why we need a macro and integrated policy. But we do have the ability to influence the point of purchase, i.e., how the goods reach the consumer, and that is an easier way to control.

Everything that revolves around these businesses and beyond the trafficking of goods, smuggling must be brought to light, but human trafficking is the worst expression of informality. This is our real drama, which we talk very little about in Latin America, despite the fact that it represents fifty percent of our economy. The most official data we have is that half of the economy is informal and this is extremely serious. Because we generate two types of citizens: first and second class. First class citizens are those who pay taxes on public health and education services, which they do not use; the people who pay taxes are those who are above decile 4 (which would be middle class), but those services they pay for are generally not used. Even more so when, in addition, public health and education suffer from a quality that they need and demand more public budget.

"WE ARE TOLERATING INFORMALITY. EVERY TIME WE SEE A LAW ENFORCEMENT OFFICER PASSING IN FRONT OF AN INFORMAL BUSINESS AND DOING NOTHING, WE ARE IMPLICITLY TOLERATING OTHER CRIMES, SUCH AS HUMAN TRAFFICKING".

We are tolerating informality. Every time we see a law enforcement officer passing in front of an informal business and doing nothing, we are implicitly tolerating other crimes, such as human trafficking. It is a question of being outside the law. Is trafficking women the same as trafficking apples or cigarettes? Obviously not, but there has to be an absolute morality in this regard. It is a matter of human dignity, justice and equity. We cannot cover the sun with a finger and hide the inequality in which we live with informality and justify informality as an exercise of "goodness" because of the reality in which we are living. We really cannot live in informality, nor can we allow or tolerate it. And the worst extreme is human trafficking, and to get to it there are a lot of previous steps. We have to start condemning all activities that are not in line with the law.

There are some key trade strategies that can be done to deal with trafficking in goods and merchandise. But for human trafficking, we need to intervene in the places where these women should be working.  In the face of trafficking, we all look to the side. We need an intervention of law enforcement agents in those spaces, that is what people do not understand, beyond the fact that the last thing they are going to give you in those spaces is a bill. And I say that trafficking is the worst scenario because they are human beings, women, who are forced to practice prostitution in an environment of absolute informality.

And we start by bringing this to light, making it public to make more and more people aware of what is happening.  Social networks are great allies for this, the networks have enabled the fourth wave of feminism and have allowed many women to raise their voices, but we have a long way to go.  The normalization of informality and human trafficking is alarming. They kidnap two girls and try to take them to Peru, and we all took it for granted that it was for human trafficking, and we assumed it as normal. That is not possible.

Human trafficking is the worst extreme of illegal and informal economy activities and the way forward is to legalize and formalize them in the face of the law. There cannot be women who are forced into prostitution, just as there cannot be trafficking of substances and goods that do not have minimum quality standards.

The research for this report was sponsored by Itabsa.

 

Translated by Manuel Novik

GALERÍA
Smuggling is part of the organized crime network
 


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