SDN Moves: Snowden leaks, peace talks and not so funny clowns

With OFAC back in action this week, we’ll see how designations pick up in the next couple of weeks. I’m sure OGT is playing catch-up but a designation package isn’t something that’s produced overnight. So in all likelihood everyone is just going to pick up where they left off. As for the world, it’s been another awfully quiet week. A lot of excitement around Iran negotiations, some very weird pre-peace talks in Syria that are most likely fruitless.   Counter-Terrorism Hassan Ghul, a.k.a. Mustafa Hajji Muhammed Khan, an SDGT was confirmed killed by documents released to the Washington Post in the Snowden leaks. Yeah, this happened.   Counter-Narcotics Francisco Rafael Arellano Felix, one of the AFO brothers (but not an SDN…he may have been de-listed but I’m still searching the federal register for historicals) was killed by a sicario in a clown costume. Bonus points for style. The linked article also has a few names of close associates that it would be wise to screen for. Chances are most people at the party have some affiliation with AFO. Now the big question is who ordered the hit? A senior member of the Sinaloa cartel, Jose Fidel Nunez Meza, was arrested. He is not designated and neither are his brothers, also listed in the article. Nonetheless, they are probably good names to add to the filter.   Country-Programs With Iran talks up, there is a lot of questions about acceptable outcomes of the negotiations. Some want Iran to completely dismantle their nuclear program, which I don’t think is an acceptable outcome for Tehran. Ostensibly, U.S. priorities are to ensure that Iran does not have a nuclear weapons capability, so a good negotiating strategy would look to have Iran give up the requisite amount of tech to ensure they can’t have nukes while still being able to retain a peaceful energy capability. In probably the most interesting article I read last week, it seems that the strategy that gives the most marginal utility is to focus on them relinquishing their medical isotope projects. It’s a somewhat statistics heavy article but it reads well and gives a lot of perspective to what the talks will look like. Does anyone know what is up with these proposed peace talks in Syria? I have no clue how that would even work. The FSA, rebellion in general, the government of Syria and all of the members of the Arab League would have to get together to pow-wow, all while being baby-sat by a stability wanting mother (the U.S.) and the worlds equivalent of a drunk and deceiving father (Russia). Count me out....

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SDN Moves: Designations, Delistings and Deals Oh My!!!

Yes, it’s Friday and time for your weekly SDN moves. And it’s been quite a busy week.   Non-Proliferation In a very interesting turn of events this morning, it was reported that the Turkish government has selected an SDN from whom to procure surface to air missiles. Instead of acquiring U.S. made Patriot or Russian S-300 SAMS, they decided to bizarrely acquire HQ-9 systems from China Naitonal Precision Machinery Import/Export Corporation (CPMEIC). What is extremely interesting about this is that CPMEIC has been designated under [IFSR] and [NPWMD]. According to 31 CFR 561.201(a)(5)(ii), anyone who facilitates a transaction for CPMEIC could be subject to CISADA. As that a bank, even possibly the central bank of Turkey could be facilitating this significant transaction, this could result in a 561 designation that would prohibit opening of a correspondent bank in the U.S. If anything, it would be wise to monitor this deal closely and ensure your institution doesn’t inadvertently engage in this transaction.   Narcotics OFAC has targeted two relatively new targets, both the Cachiros in Honduras as well as Los Gueros in Mexico. Erich Ferrari already did a piece on the Gueros organization, whom frankly not much information exists. I honestly don’t know much about them other than their 2009 indictment. The Cachiros are an interesting case. They are Honduras’ largest organized crime and a transiter of cocaine from Colombia to Mexico. The Cachiros are well connected to Guatemalan gangs (which makes sense given their transportation routes). This is significant in as much as the Sinaloa and particularly the Zetas have extremely strong ties to Guatemala. Many of the Zetas original members were part of the Guatemalan Kabiles, a light infantry/special forces unit similar to the one that the Zetas defected from, and along with distribution of cocaine the Zetas have been known to run training camps and obtain heavy weaponry in Guatemala. I view the designation of the Cochires as a smart attempt to cut as deep in the supply chain of two of the worlds most terrible organizations. Los Cochires have been known to wield powerful influence, enough to be in a position to pressure the President to appoint one of their own as a minister. Apparently he refused so they offed a senator in revenge. This level of governmental penetration suggests high levels of dual sovereignty for the organization in Honduras and it wouldn’t be surprising if some of these designations have ownership or interests in a large area of commerce. Point and case. it has been alleged that the Cachiros not only have strong ties to the Honduran government but also own the Real Socieded Municipal soccer club and the clubs prime sponsor, Joya Grande, a Zoo in Honduras. (hint: add these to your filter…you’re welcome). Speaking of Central America, SDNTK Waldemar Lorenzana Lima was captured on the 20th.   Terrorism Unfortunately, we’ve seen the tragedy that an FTO can strike after al-Shabaab fighters struck a mall in Kenya, killing dozens. People are still reported missing and the attacks are alleged to have involved several Americans and a UK national. Analysts are stating that this attack both marks a shift in al-Shabaab strategy towards a much more dispersed terrorist group rather than the insurgent force that once controlled much of Somalia.  The organization has undergone leadership changes and solidification of power, as we saw with last week’s SDN-on-SDN killing. OFAC also delisted several SDGTs, mainly because they gave up their ways through kinetic thought disruption. It’s important to remember that the simple act of dying does not remove you from the SDN list as that there...

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SDN Roundup: the top SDNTKs in Mexico and which cartels to focus on

Borderland Beat has a good little article of the top ten most wanted cartel leaders in Mexico. One of the top honchos, Miguel Trevino, was captured and has been charged with money laundering. Oddly, its unlikely that murder charges will stick in Mexico, but we will see. If you or your compliance program are looking to do a deep dive into the risks associated with Mexico, it may be a good idea to mirror OFAC’s actions. Of the members on this list, the ones I would focus on the most would be of the bosses belonging to either the Sinaloa or Zeta cartels.  OFAC designation strategy has been primarily targeted towards those two entities and with good reasons. Tracking the cartels can be a difficult job. One thing I noticed when doing my thesis is that you could have four turf maps from the same time period that will tell you five different answers. Cartels expand, contract and replicate with such fluidity that it is hard to keep track. Take a look at what happened with La Familia: a leader is either killed or arrested and the organizations engages in a fun version of cartel mitosis and viola, you now have two cartels for the price of one. The two cartels that have differentiated themselves however are both the Sinaloa and Zetas, and for two very different reasons. These reasons make them a greater threat and thus a more frequent stomping ground for SDN designations. Perhaps the greatest focus from OFAC will be on the Sinaloa cartel, and the main reasons is that Sinaloa has been the historic root of the cartels and their organization has remained persistently effective. Sinaloa province has been the traditional heartland of Mexican criminal activity and the original center of (legal) opiate production. Geographically, the terrain is mountainous and hard for the government to establish a presence and lends itself well to a smuggling route up through Sonora province and into the U.S. But more than that, due to a lack of government presence and corrupt institutions with the old PRI, the cartel was able to firmly cement itself in a monopoly until they decided to split (well, more like the government sort of forced them to split through death and destruction) into the the Sinaloa Federation (which still retained the main institutional structure), the Arrellano-Felix Organization and the Juarez Cartel.  This drove up competition, which meant more violence yet Sinaloa always remained the base of power. This remains the case today, with Sinaloa best able to prevent splinter factions and drawing from its own regional security as the progenitor of the cartels. The focus by OFAC on the Zetas is a bit more short term. In a lecture a while back I got into a heated argument when I asserted that the Sinaloa should be the main focus of the USG and the other cartels were necessary diversions. A very angry attendee asked me how I could possibly brush off the Zetas as they were the most violent and even she had been threatened when she lived in Mexico. My first response was something along the lines “yeah, you and everyone else in Tamaulipas” (which for the record, didn’t make her feel better) and then bet her a dollar that while the Zetas were a huge concern at present, they wouldn’t be in five years. Well, it’s been a year, their leadership is now MIA behind bars or in body bags, groups such as the Sangre Zetas show evidence of splintering and I could really use the extra dollar. But in the end,...

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