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Corruption Watch: October 25, 2002

25 October 2002, Volume 2, Number 38
Ali Hashemi, the head of Iran's antinarcotics bureau, told a narcotics conference in Tehran on 14 October that a large influx of drugs is heading towards Europe. The speaker blamed the international community for failing to deal with this problem. The estimates for this year's opium harvest in Afghanistan have been placed at between 3,500 to 4,000 tons, close to the record crop of 4,500 tons in 1999. According to a UN official in the 14 October "Financial Times," five Afghan provinces were economically dependent on opium cultivation. But another UN official pointed out that a growing amount of opium was originating in areas under the control of the Northern Alliance, officials who are now in many key positions in the central government in Kabul.

The United States and other G-8 countries are anxious to see the Afghan government play a larger role in combating the drug problem. The Karzai government recently created a National Security Council to deal with this question but, according to "The Economist" from 11 October, many of the regional Afghan leaders benefited from opium trafficking in the past and are likely to object to any interference from Kabul.

On 10 October the Czech customs service confiscated 9 million smuggled cigarettes and arrested three smugglers, CTK reported on 15 October. Had the shipment gone through, the Czech treasury would have lost 16 million crowns ($506,000). The shipment was confiscated from a truck driven by a Czech national who was being accompanied by a Slovak and a Vietnamese citizen. Customs officials stated that the cigarettes originated in China and were destined for a Slovak firm. The shipment was labeled "shoes." German police took part in the operation.

Writing in "Nezavisimaya gazeta" on 9 October, political consultant and Foundation for Effective Politics President Gleb Pavlovskii said the threat from the Iraqi regime is not limited to its development of nuclear and chemical weapons. He said Saddam Hussein's regime also actively supports a new kind of weapon of mass destruction: Islamic suicide bombers, or "shakhids," targeting the symbols and infrastructure of modern civilization. Indeed, in purely military terms, such suicide bombers can be defined as bearers of weapons of mass destruction already located in the territory to be attacked. Pavlovskii said that the human bombs embodying a new, "cheap," and devastating element of "megaterror." While the international community has already recognized suicide bombing directed against a civilian population as a crime against humanity, Pavlovskii said, the regime in Baghdad is the only government in the Middle East that is openly endorsing, welcoming, and popularizing suicide bombers in the Arab world. Moreover, Saddam Hussein this year extended his financial support to suicide bombers, publicly announcing that he allotted $5 million for Islamic suicide bombers and their families in Israel. Bearing all this in mind, Pavlovskii said, there is no effective policy other than to challenge this threat through preemptive action. As far as Russia is concerned, the country is more vulnerable and open to "megaterrorism" than, say, the United States, because it has neither sufficient power nor the legitimacy to use force outside of its borders. Despite its intensive economic ties, Russia is thus interested in formulating an ultimatum for Iraq, whose irresponsible behavior has provided the basis for such a move, Pavlovskii concluded. (Viktor Yasmann)

The London-based newspaper "Al-Hayat" said on 20 October that there is a link between the Bali attack and letter bombs sent last week to security posts in Pakistan. The Islamabad correspondent for "Al-Hayat," Ahmad Mowaffaq Zeidan, quoted "sources" telling him that the same kind of explosive (C 4) was used in the Pakistan letters and the Bali attack. The sources stressed that this kind of explosive cannot be purchased in local markets. Pakistani forensic experts are still analyzing the eight letter bombs, three of which exploded while the others were defused, according to "Al-Hayat." The Pakistan-based Lashkir Jihangawi (World Army) organization, which reportedly has links to Al-Qaeda, claimed responsibility for the letter bombs.

Police in Moscow announced that the governor of Russia's far eastern region of Magadan was shot dead on 18 October while on a trip to the capital. Valentin Tsvetkov was shot by an unknown assailant as he left the Moscow office of the Magadan regional administration, ITAR-TASS reported the same day. The killer jumped out from behind a billboard on the Novy Arbat Street, fired one bullet into the back of Tsvetkov's head, and then got into a waiting car and fled. Tsvetkov, 54 years old, had been the governor of Magadan since 1996 and is the highest-ranking government official to be murdered in post-Soviet Russia.

The killing is the second involving a Russian politician in less than two months. State Duma deputy Vladimir Golovlev was assassinated in August 2002 in an apparent contract killing. His killers have not been found.

Investigators declared the Tsvetkov killing as probably linked to a business dispute in Magadan. Tsvetkov had been trying to bring his far eastern region's lucrative gold, oil, and fishing industries under his personal control. In a recent interview on NTV, Tsvetkov spoke at length about his efforts to bring Magadan's gold trade out of the shadows by forcing miners to sell to the state instead of to Ingush criminal gangs.

"The version related to Tsvetkov's professional activities is considered the main one," Deputy Interior Minister Vladimir Vasilyev told NTV television.

According to "The Moscow Times" of 21 October, the attack was filmed by two outdoor cameras -- at the Angara restaurant and at a nearby police station. Investigators, after scrutinizing the tapes and questioning witnesses, have compiled a composite sketch of the attacker. They say he is about 30 years old and has a Slavic appearance.

Police said the assailant dropped the murder weapon, a Makarov pistol equipped with a silencer, near the body before running away. He was whisked away by an accomplice in a Zhiguli sedan.

An hour after the murder, police found the car abandoned in the center of Moscow, according to media reports. Inside they found the killer's jacket, pants and boots.

The Serbian town of Gornji Milanovac was named as the main transit stop along a heroin route with distribution centers in Novi Pazar, Jagodina, and Topola, according to Aleksandar Domanovic, an inspector with the narcotics department in the Cacak Secretariat for Internal Affairs, the daily "Polityka" wrote on 5 October. Domanovic also told of widespread drug use in the schools of Gornji Milanovac and complained that the police were not properly equipped to deal with this problem.

Ukrainian President Leonid Kuchma allegedly provided $50-$60 million to help finance Russian President Vladimir Putin's 2000 election campaign, "Kommersant-Daily" reported on 18 October. The daily's report is based on tapes that former Kuchma bodyguard Mykola Melnychenko allegedly recorded in Kuchma's office between November 1999 and September 2000. The newspaper printed what it claims to be a transcript of a conversation between Kuchma and two officials that was recorded on 15 July 2000. "Before the elections we paid Russia at Putin's request, I don't know, about $50 million or $60 million," Kuchma is quoted as saying. In the recording, Kuchma talks about the repayment of the gas debt owed to the Russian company ITERA and says that Putin asked that the money be repaid. According to Ekho Moskvy Radio on 18 October, the Putin administration categorically denied this information. According to reliable sources, this recording was not provided by Melnychenko to "Kommersant-Daily" and he has disclaimed any responsibility for its dissemination. Other reliable sources confirm that the Ukrainian company, Naftogas Ukrainy, did in fact repay part of the debt owed to ITERA at about the time this alleged conversation took place, but that this payment had no link to the Russian elections.

On 12 October, Ukrainian police arrested a Russian businessman, Konstantin Grigorishin, and charged him with resisting arrest and possession of a firearm. Officers claimed that they found an unregistered gun and plastic bags containing cocaine in his possession after the arrest.

Grigorishin was jailed after a hearing on 15 October at Kyiv District Court and released on 20 October.

Grigorishin, 36, is a board member of a number of large Ukrainian energy and industrial companies, including Lvivoblenergo, a power distributor, and Dniprospetsstal, a metals manufacturer.

Grigorishin was arrested in downtown Kyiv after visiting a restaurant with parliament deputy Volodymyr Syvkovych. The two had entered Syvkovych's Mercedes when more than 40 law enforcement officials descended on the vehicle.

A statement issued by Grigorishin said the arrest violated Ukrainian law and was without due cause.

"Grigorishin was pulled out of the car, kicked, and beaten with the butts of automatic rifles and handcuffed," the statement read. "A gun was stuffed in his pocket right in front of everyone and then he was thrown into a police car and driven away."

Yury Artemenko, a parliamentary deputy and a member of the Our Ukraine opposition faction, told the "Kyiv Post" on 13 October that he suspected businessmen fighting for control over Ukraine's energy sector were behind the arrest.

"Control of enterprises is being wrested from successful entrepreneurs simply by planting drugs or a gun, or by other means," he said. "These businesses are then frozen for between three to 15 days, which is time enough to divide the spoils."

Artemenko accused the Presidential Administration of masterminding the arrest. Administration officials were unavailable for comment.

Upon his release from prison, Grigorishin told a press conference that the head of the Presidential Administration, Viktor Medvedchuk, had threatened him with arrest earlier. Grigorishin claimed that he refused to give money to the election fund of the Social Democratic Party (United) and in return, Medvedchuk and Heorhiy Sirkus, a main Ukrainian oligarch and one of the leaders of the SD(u) party, told him that they would close down his business and have him arrested.

The "Financial Times" of 21 October reported that a delegation from Afghanistan's former Taliban government, accompanied by two individuals from the Al-Qaeda terrorist network, traveled to Odesa and Kyiv in September 1999 in search of arms, including aircraft parts, and pilot training. The daily writes: "The delegation, led by Abdul-Rahman Zahed, the Taliban's deputy minister of foreign affairs, were received by senior officials, according to two people who were there. The visit was made before a UN arms embargo was imposed on the Taliban. Ukraine has also engaged in other deals that, although not illegal, raise concerns. A report prepared this year for the UN's international war crimes court for the former Yugoslavia found that Ukraine secretly supplied two helicopters and spare parts to Belgrade in 1999, just before the launch of raids by Serbian forces in Kosovo that led to the reimposition of UN sanctions on Yugoslavia."


Roman Kupchinsky

After the Velvet Revolution and the fall of communism, organized crime in the Czech Republic began to constitute a serious problem for the country. The influx of Russian, Ukrainian, Chechen, and other criminals into Prague and other cities created a serious problem for Czech law-enforcement agencies. Faced at the same time with the problem posed by Vietnamese organized-crime gangs, the Czech police were not fully prepared for the rapid expansion of lawlessness in their country.

Organized crime in the Czech Republic is, by and large, an imported product, although there are signs that native Czechs have begun engaging in some aspects of criminality in an organized manner.

The first organized crime groups in the Czech Republic were Vietnamese gangs. Operating mainly within the 60,000-80,000 large Vietnamese community in the Czech Republic, these gangs first established themselves in 1975-76 when the first wave of Vietnamese emigrants came to communist Czechoslovakia as a labor force sent by the new communist government in Ho Chi Minh City (Saigon) as a method of repaying the large wartime debt owed to Czechoslovakia from the Vietnam War. The 1975 Vietnamese wave of immigration was followed by two others, one in 1977 and in 1979-1982.

The 10-15 Vietnamese gangs operating in the Czech Republic are organized into groups following one charismatic leader (this can also be a "respectable man" in the community) who serves as both a person who can communicate with Czech authorities and as an arbiter of quarrels among different groups. In other cases, the leader can be someone like Black Son, a former Vietnamese worker who came to the Czech Republic in the mid-80s and organized a group of some 10 people for violent criminal activity. The Black Son gang is still active. It is not connected to any specific territory and is a typical "flying gang" similar to Vietnamese gangs in California and Texas in the United States. The gang is known for violent crimes and is used by Chinese gangs as enforcers.

A different version is the "business gang," which is involved in smuggling goods and people from Central Asia and Southeast Asia to Western Europe, including women for prostitution. The largest gang of this type is the Vuong Van Vu based in Karlovy Vary.

The Vietnamese groups are also involved in money laundering, casinos and restaurants, as well as in drugs and extortion of money from Vietnamese merchants. Most of the so-called "Vietnamese markets" in the Czech Republic have a mob presence and most merchants tend to pay "taxes" to these gangs for "protection." As is common in the U.S. and in Western Europe, members of the Vietnamese communities tend not to seek help from the local police and prefer to pay gangs the protection money they demand.

Most Vietnamese gangs allow only Vietnamese members, but recently there have been instances of Vietnamese working together with Czechs in smuggling operations. Thus on 10 October the Czech customs service confiscated 9 million smuggled cigarettes and arrested three smugglers, CTK reported on 15 October. Had the shipment gone through, the Czech government would have lost some 16 million crowns ($506,000). The shipment was confiscated from a truck driven by a Czech national who was being accompanied by a Slovak and a Vietnamese citizen. Customs officials said the cigarettes originated in China and were destined for a Slovak firm. The shipment was labeled as shoes. German police took part in the operation.

In the early 1990s the face of organized crime in the Czech Republic began changing with the influx of Russian, Ukrainian, and Chechen gangsters into the Czech Republic. Taking advantage of different loopholes in Czech law to settle in the country legally, these men soon set up their criminal organizations. The rackets run by the Russian, Ukrainian, and Chechen gangs included trafficking in women, drugs, and illegal documentation for Russian and Ukrainian workers.

The size of the Russian community in the Czech Republic is unclear. While official statistics indicate that 6,700 Russians are registered in the country, unofficial sources estimate that about 20,000 Russians have moved in since 1989. The Russians themselves say that most of the immigrants to the Czech Republic are businessmen.

The centers of Russian activity are Prague and the spa city of Karlovy Vary. And while it is rumored that many of the hotels and other real estate in Karlovy Vary has been purchased by "the Russian Mafia" over the years, there is little available evidence to prove this.

In the past few years, a number of high-profile gunfights have occurred between competing Russian and Chechen gangs in Prague. According to police sources these were mainly turf battles.

Czech police attribute much of the petty street crime in the Czech Republic (pickpocketing, currency scams, purse snatchings) to Romany clans. However, while not denying that Roma are involved in street crime, a participant at a 1996 conference on Roma and the media stated: "while it is true that Roma as a group are more inclined to commit crimes than are non-Roma, and that a disproportionate amount of petty crime is committed by Roma, these facts do not mean that there is a cause-and-effect relationship between being a Rom and committing a crime. Yet that is what is implied when it is mentioned that it was a Rom who robbed somebody. One should ask: Is it Roma who are overrepresented on the crime list or is it the unemployed? Is it the case that Roma commit more crimes, or that the police are more likely to arrest someone if he's a Rom?"

One of the greater concerns of law enforcement agencies worldwide is the role played by Czech citizens in illegal arms sales to rogue regimes. In 2002 three persons were arrested on such charges, among them two Czech citizens and a Russian with Canadian citizenship. The case has not gone to trial at the time of this report, but it is said that the three controlled a large illegal arms sales enterprise, which sold small arms allegedly to Iraq. In 1999 a Czech company was caught trying to smuggle six MiG fighter planes to North Korea. The Czech company Agroplast was implicated in that deal and Washington placed a commercial ban on the firm.

"With the demand in the Czech Republic as large as it is, it doesn't matter what we do, the Czech Republic will remain a paradise for criminal organizations dealing in drugs," National Anti-Drug Center Director Jiri Komorous told the CTK news agency on 21 October. According to the latest statistics from March, the number of drug users in the Czech Republic continues to grow. Currently, there are about 100,000 drug users of which roughly one-third are thought to use drugs regularly while the rest use them recreationally.

According to the U.S. State Department report on drug trafficking in 2001 in the Czech Republic: "Heroin from the south (mostly Turkey, moving north via the Balkans) transits the Czech Republic en route to Northern and Western Europe. Czech authorities attribute most of this activity to Kosovar-Albanian drug mafias, some of which maintain warehouse operations in the Czech Republic. Some heroin is also sold in the Czech Republic. Cocaine and marijuana also reach the Czech Republic, mostly in transit to Northern and Western Europe, although some is sold to Czech residents and tourists visiting Prague. MDMA (ecstasy) use has increased in recent years, and police are concerned that PMA (an ecstasy-like "club drug") and GHB have begun to appear on the Czech market. Pervatine is produced in the Czech Republic, primarily for local consumption. Czech counternarcotics police believe Russian-speaking and Asian gangs now control about half of the pervatine market and that increasing amounts of the drug are now being exported to neighboring countries" like Germany and Poland.