Coauthored with Isabella Bennett, program coordinator in the International Institutions and Global Governance program.
President Obama and Governor Romney may have been arguing over the strength of sanctions on Iran, but there is another set of sanctions that the Obama administration has enacted on a global threat which would likely win Romney’s approval: sanctions against international criminal groups.
In July 2011, the White House issued an executive order sanctioning four transnational organized crime groups: the Brothers’ Circle (a Eurasian group spanning the former Soviet Union, Middle East, Africa, and Latin America); the Camorra (an Italian criminal group that operates international counterfeiting rings); the Yakuza (a Japanese criminal group with affiliates in Asia, Europe, and the Western Hemisphere that claims as many as eighty thousand members and facilitates sexual slavery and white collar crime); and Los Zetas (a Mexican criminal organization that is blamed for tens of thousands of deaths and widespread drug trafficking throughout the Americas).
The order granted the U.S. secretary of the treasury (in consultation with the attorney general and secretary of state) the right to enact sanctions on any group or person that “constitutes a significant transnational criminal organization”—or has knowingly assisted a designated criminal group. Beyond freezing their assets, the executive order allows U.S. courts to sentence to up to twenty years in prison any person convicted of being a member of one of these groups or of aiding them.
Two weeks ago, the Obama administration broke new ground by extending this designation for the first time to a gang operating in the United States, the Mara Salvatrucha (MS-13). MS-13 originated in the barrios of Los Angeles in the 1980s, and then spread to Central America a decade later when the United States deported as many as twenty thousand gang members with criminal records to El Salvador (and continues to deport upwards of thirty thousand ex-convicts to El Salvador today). Today, the group operates throughout Central America and in at least forty U.S. states, according to a 2008 FBI report , and is reported to be spreading to Canada. Harrowing reports—like the gang’s prostitution of girls as young as twelve and execution-style shootings in a schoolyard of three students by former friends—motivated the Obama administration to target MS-13.
The logic behind the sanctions is that money laundering “is the life blood” of transnational organized crime. This implies, as CFR’s Global Governance Monitor: Transnational Crime explains, that following the money is an effective strategy to disrupt criminal operations. The sanctioning of MS-13 is just the latest step in a twenty-first century arms race between sovereign governments and violent nonstate actors empowered by technology and globalization. In the wake of the September 11 terrorist attacks, the Bush administration expanded sanctions provisions against terrorists and “associated” groups and individuals, restricting their access to U.S. markets and freezing their U.S. assets. The United States also worked closely with partners on the UN Security Council to pass UNSC Resolution 1373, mandating that all UN members enact sanctions against al-Qaeda and the Taliban. The Financial Action Task Force (FATF)—an intergovernmental body of thirty-six countries created in 1989—also published a “blacklist” of countries with lax money laundering policies that successfully pressured national governments to tighten oversight of money laundering.
While countries have long pledged to require banks to follow anti-money laundering standards to root out corruption and hinder criminal behavior, no government had enacted sanctions and sought to freeze the assets of criminal groups until the United States did so in July 2011. The goal of the new MS-13 sanctions is to hinder the gang’s ability to transfer money between the United States and leaders in Mexico and Central America. The hope is that shutting off this financing will limit the gang’s ability to arm itself to the teeth and reduce the income available to support members. One Immigration and Customs Enforcement special agent, Stephen Hayes, told the Daily Beast that the hope is to prevent what officials fear is MS-13’s next step: expansion into legal businesses or investment in legitimate U.S. companies. Hayes explains, “We want to prevent them from taking the next step, we want to prevent them from becoming the next global cartel.”
However, the United States cannot choke off the group’s finances alone. As with so many of today’s transnational threats, effective disruption will depend on the extent and effectiveness of international cooperation. Criminal activities today easily pour across borders while the authorities attempting to fight them are restricted to national boundaries. In this case, the cooperation of Central American authorities is critical, as George Grayson of CSIS emphasizes. However, the lack of capacity of many countries’ institutions, deeply entrenched corruption, and surging violence in Central America adds to the challenge. The homicide rates in El Salvador and Honduras, where MS-13 operate extensively, are 82 and 66 per 100,000 inhabitants respectively—over thirteen times the rate in the United States.
National-level sanctions against MS-13 are a welcome development. But they aren’t enough. The United States “has a ‘long and messy’ history in Latin America” but is also uniquely positioned to provide assistance given its political influence, geography, shared problems like transnational crime, and U.S. economic and diplomatic resources. It should press its allies in the region to implement multilateral arrangements, such as the international Convention Against Transnational Organized Crime UNTOC) which the entire Western Hemisphere has ratified. UNTOC contains provisions to bolster law enforcement cooperation, technical assistance to less developed countries, and mutual legal assistance. The Multilateral Evaluation Mechanism of the Inter-American Drug Control Commission provides an ideal forum for experts to review domestic frameworks and identify the strengths and weaknesses of countries’ efforts.
Another existing multilateral initiative that provides a promising model is the International Commission Against Corruption in Guatemala, which has helped oust thousands of corrupt policemen and judicial officials, thus strengthening the local law enforcement with which the United States must partner to attack transnational criminal groups across borders.
The United States could propose that the UN Security Council expand its repertoire of multilateral sanctions beyond terrorists to include criminal groups. This would likely meet considerable resistance from developing countries, however, suspicious of a UNSC seeking to extend the scope of its authority over the broader UN membership. Alternatively, the United States could pursue a regional option, proposing targeted multilateral sanctions against MS-13 and similar entities at the Organization of American States. Winning approval for such a resolution could be contingent on greater U.S. willingness to modify its current approach to the “war on drugs” to address growing sensitivities among its regional neighbors.
Ultimately, however, the solution to transnational crime lies in the elusive goal of improving domestic institutions—ranging from the law enforcement and judicial sectors to education and health that improve opportunities for young people. In the meantime, countries must endeavor to work with each other to follow the money and disrupt the operations of transnational criminal groups as much as possible.