02-Dec-2011 - Guatemala: Los Zetas grip on the Mexico-Guatemala border
As the Zetas expand in northern and central Mexico, their control over the entire extension of the Mexico-Guatemala border remains a point of strength for the group. The corridor, particularly the Chiapas-Peten border, helps drive their profits for human and drug trafficking, and provides them a potential safe haven from the Mexican authorities when they increase pressure.
02-Dec-2011 - Mexico: Why Guadalajara is the next hotspot, part II
A key question entering 2012 will be whether the Zetas consolidate their control over this corridor or begin to lose ground in the face of coordinated government actions. Just this month, the Zetas took two blows at different points along that border, but remain powerful.
First, Mexican authorities arrested Santos Ramírez Morales (alias ‘El Sapo’ or ‘El Santo Sapo’) the leader of Zetas operations in Tabasco and Chiapas. The arrest of El Sapo and 25 other alleged collaborators in Ocozocuautla, Chiapas was based on intelligence work by the Mexican authorities tracking the movements of drugs across the Guatemala-Mexico border. Information divulged during the arrest also revealed details about Zetas operations in the region including a network of construction businesses based in Mexico such as Constructora Limpez S.A de CV that were used to traffic drugs and launder money. Several vehicles identified with that firm were seized by police following the Zetas arrests.
Second, Guatemalan authorities broke up several Zetas cells in the northern part of the country. Police arrested two people accused of providing the Zetas with vehicles, weapons and safehouses in the Zacapa province who helped the Zetas move through northern Guatemala. More troubling, Guatemalan police rescued a thirteen year old Mexican boy who had been kidnapped in Chiapas and trafficked to a Zetas safehouse in Huehuetenango on the Pacific coast of Guatemala. The “reverse movement” of kidnap victims from Mexico to Guatemalan safe houses should be troubling to officials in both countries, though this incident remains an outlier anecdote so far.
Meanwhile, Mexican and Guatemala authorities search for more cooperation with the election of Guatemalan President-elect Otto Perez Molina. Perez has praised President Calderon’s offensive against the criminal groups in Mexico and promised to bring his own style of offensive to his country, along the lines of how former Colombian president Alvaro Uribe took the fight to the Revolutionary Armed Forces of Colombia (FARC) . Specifically, Perez has promised to increase the use the Kabiles and paratrooper special forces brigade to take on the Zetas. To make the point, he named a colonel from the Kabiles, Ulises Anzueto, as his minister of defense. Anzueto’s first public promise was to dedicate two brigades each of military police and special forces to the task of confronting organized crime.
Of course, Colom was no dove on the matter. Guatemala’s current president has used the military, declared states of seige, worked with his regional counterparts, and has gone as far as making a call for a regional NATO force. However, the general sense is that the organized crime problem including its infiltration into government institutions and society has worsened even as statistics about homicide have improved.
Perez’s promise to increase military use, particularly the infamous Kabiles who many link with human rights abuses and with desertions to criminal organizations, is exactly what Perez opponents feared and supporters hoped. There are fears among NGOs in the country that Perez will increase the military power and influence across sectors that were previously civilian. However, a large portion of Guatemalan society is young, a majority born after the civil war was over, and they will reward progress on security however it is achieved.
One concern with Perez’s policies is that the military focus may miss some of the other border problems. Poverty, poor infrastructure and land disputes all contribute to the poor security situation on the border. Land use, including ranches that may be linked to illicit traffickers, has also degraded the fragile environment in the remote regions of Peten. As InSight Crime reported earlier this year, the Zetas have established themselves deeply within businesses and society on the Guatemalan side of the border. Perez needs to recognize that they cannot just be confronted militarily and other aspects of national power will be needed as well.
The 24-25 November mass killing of 26 individuals, dumped in a symbolic section of Guadalajara, was a message left by Heriberto Lazcano for El Chapo Guzman, his primary rival. Within hours of the federal police pullout of Guadalajara at the conclusion of the Para Panamerican Games, Los Zetas operators began kidnapping individuals likely tied to several low-level Sinaloa Federation operations in the city. Though the absence of these individuals will have little to no impact in the overall structure of the Sinaloa Federation’s operations in the city, it left a strong message in the wake of the attacks on Los Zetas in Veracruz, where the Matazetas vigilante group killed over 30 low-level Zeta operators in September 2011.
30-Sep-2011 - Mexico: Why Guadalajara is the next hotspot
As Southern Pulse presented in the first report, Why Guadalajara is the next hotspot, Los Zetas organized and executed a well-planned attack, but after careful consideration and a series of discussions with our investigators and sources in Guadalajara, we assess that this even is isolated and should be considered as a messaging device, not the harbinger of a sustained conflict in Guadalajara.
We agree with our sources who claim that Guadalajara is still well within the grip of the Sinaloa Federation. One source suggested that the city itself is perhaps more of a symbolic trophy than logistically necessary for the Zetas criminal enterprise. Considering the layout of the routes in and around the city, and through Jalisco, Zeta control of outlying routes and highways would allow the organization to operate in the region without the possibly high losses that would result in a direct assault on Sinaloa Federation forces in the city.
Unlike Monterrey, where logistics routes run through the city, and the state of Nuevo Leon, where most significant routes pass through or near Monterrey, the city and state of Guadalajra and Jalisco present several options for logistics, a fact that supports the consideration that the Zeta push for control of Guadalajara is more likely to play out in the state of Jalisco before it spills over into the city’s streets. While it is possible that Guadalajra becomes a focal point of violence in 2012, its more likely that in their currently weakened state, Los Zetas will focus first on easy targets and gather strength before mounting a criminal seige on Sinaloa Federation operators, assets, and government partners in Guadalajara.
The body dump by the Arcos de Milenio in Guadalajara was a message that fits well within the long-established Zeta strategy of using fear as a weapon. In a city that the Mexican government touted as “bulletproof,” the body dump reminded local, state and federal leaders that Los Zetas could strike at will in even the most secure sections of the country. At the same time, this message reminded El Chapo that his enemies are in his backyard - an effective reminder that simultaneously pulls El Chapo’s attention from attacking Los Zetas flanks in Veracruz and forces him to wonder about other cities he once thought were secure.
A body dump in the city of Culiacan, a day before the Guadalajara event, was possibly connected. If so, the double massacre indicates a high degree of planning and makes a strong step in the direction of raising doubt within the high-level ranks of Sinaloa Federation’s strategic thinkers. As the chess match between these two groups and their proxies continues, Guadalajara will remain a focal point, though an assault on the city before Los Zetas establish a stronger presence in the state of Jalisco is less likely in the wake of this massacre.
As we move into the remaining months of 2011, Mexico appears to be on the verge of a new wave of violence that has less to do with vigilantism – a passing fad – and more to do with building tension between the country’s two top criminal organizations: the Sinaloa Federation and Los Zetas. Guadalajara is the city where the next battlefront between these two offensive-heavy organizations is likely to play out before the end of 2011.
30-Sep-2011 - Panama: Governing coalition cracks as Martinelli makes new power plays
As we continue to observe activity in Mexico through the lens of our Zetas Cross theory, the 14 September 2011 official confirmation of a Los Zetas alliances with break away members of the Milenio Cartel, brings the paramilitary group one step closer to claiming Guadalajara.
Firefights in Chapala and in Jardines del Bosque suggest that Los Zetas are already testing the groups set in place to protect El Chapo’s investment in the state and the city where his organization has held sway for decades.
There is also a possibility that members of Los Zetas are supporting their Milenio Cartel partners with arms, though this level of direct support remains less clear. Either way, the Milenio Cartel's long-time presence in Guadalajara increases Zeta intelligence gathering in the plaza, could lead to the solidification of a network of Zeta safe houses in the city, and presents an opportunity to pierce the battlefront the united cartels against Los Zetas have formed in southern Zacatecas.
Meanwhile, the current news of vigilantism in Veracruz, and the Matazetas specifically, appears to be little more than a nuisance, and not a sign that Los Zetas are weakening as some analysts have concluded. The Matazetas, likely a formation of men from El Chapo’s Gente Nueva and young gunmen from the Cartel Jaslico Nueva Generation, may be brutal, but they’re not new. According to one journalist, Matazetas as a criminal brand has been used in the past. By our count, this is the third time a group of sicarios has used the term to announce a new vigilante effort to remove Los Zetas from the earth.
If the Carteles Unidos, formed in February 2010 between the Sinaloa Federation, the Gulf Cartel (CDG), and La Familia Michoacana (LFM) at the height of CDG and LFM power was not able to take out Los Zetas, this new group of upstarts poses little threat.
So far, this new group of Matazetas has been more adept at spreading criminal public relations videos and narco-banners than presenting a tactical front that threatens Los Zetas well-entrenched operations throughout the gulf state. Indeed, it is possible that the Veracruz massacre of alleged low-level Zetas operators was an attempt to distract El Lazca from his current offensive push into Jalisco. It looks like something El Chapo would try to do his newfound nemesis, El Lazca.
Possibilities aside, the Zeta boss – and likely his enemies – will suspend any major activity in Guadalajara until after the Pan-American games. With over 10,000 police and a quantity of soldiers - pulled from their duties in Ciudad Juarez - on special assignment during the games, we would be surprised to register anything more than a slight blip during the Games. Though when they are over, a major criminal offensive for the city could surface in early November, developing into a protracted battled for the city that will last though the end of the year, and possibly well into 2012.
For the fourth time in four years, the hemisphere is seeing a battle that places a president and vice-president on the opposite sides of a politically destabilizing fight. Panama’s governing coalition has cracked, leading to the firings and resignations of top officials and a political battle that will reshape the second half of President Martinelli’s term in office and his possible reelection campaign. In the background, allegations of corruption and rumors of threats suggest Martinelli is playing a dirty political game he intends to win.
30-Sep-2011 - Honduras: Minister of Security resigns amid political struggle
Ricardo Martinelli created and funded the Democratic Change (CD) Party. In 2009, he struck a deal with Juan Carlos Varela and his Partido Panamanista (PP) to create the "Alliance for Change." At the time, the agreement was Martinelli would run for president and Varela would run in 2014 as the alliance candidate after serving a term as vice president.
However, within months of becoming president, rumors began to swirl that Martinelli had a plan to run for reelection. Like many other leaders in Latin America, he hoped to reform the electoral rules that barred reelection and create a second round system that most analysts believe would benefit the president. Separately, the president was trying to get the Alliance for Change to commit to an internal primary to choose its candidate.
The feud has intensified over the past few months. Martinelli's CD party claims that Varela has not upheld his promise to support an electoral reform that will allow for a two-round presidential vote and potentially reelection of the president. Varela says the CD party started the feud by not following through a promise to allow the PP to take the next presidency of the national assembly.
During these inter-alliance battles, Varela realized the president was trying to change the game. Varela decided to beat Martinelli to the punch, getting his party to nominate him as the PP presidential candidate, three years before the 2014 presidential election. The move infuriated the president and set the stage for the coalition break in August 2011.
The events came to a boil in late August when Martinelli fired Varela from the foreign minister post, in which he concurrently served while serving as vice president. While Varela cannot be fired as an elected vice president, other members of the PP, including Minister of Finance Alberto Vallarino and six deputy ministers resigned to show their support for Varela. Martinelli quickly moved to place CD party loyalists into the empty chairs.
The battle now shifts to Congress. With the PP now in open opposition to the president, the non-unified group of opposition parties is now in the majority and can block the president's agenda when they choose. While the PP is highly unlikely to unite with the other opposition parties, such as the PRD, in implementing an agenda, they will gladly join forces against the common enemy that is the president.
Martinelli has already indicated that he will counter-attack by offering incentives to anyone in the Congress who changes parties and helps give him back his majority. While this publicly meant political support, the implication in the media was that Martinelli was offering bribes, political favors and protection to those who supported him while those who opposed him would be targeted.
Members of the PP say Martinelli has personally threatened to have them charged with corruption. It appears that Martinelli's political operatives have audited personal finances and collected information about every member of the former coalition partner, looking for people who can be bribed and blackmailed.
There are also indications that Martinelli is offering political immunity to some in the opposition who change sides. The mayors of Chame and San Miguelito changed political parties to the ruling Democratic Change (CD) party while under investigation for embezzlement. The implication is that they believe the party will protect them from prosecution in exchange for political loyalty.
In a larger controversy, the mayor of Panama City finds his job in jeopardy. The PP candidate was elected mayor in spite of some questions about his citizenship. The CD originally backed a legislative measure to ensure he could hold the slot, but following the government coalition break up, the CD members in Congress introduced a bill to revoke his citizenship once again, which would force him to drop the mayoral slot.
In the background of many recent political battles is a complicated land deal involving the president that has become a major corruption investigation by the Panamanian media. The president transferred a piece of prime real estate in Panama City to a group of businessmen, one of whom accompanied him on his August vacation to Europe. While the president originally claimed it was just one of hundreds of typical land deals, one poll by the newspaper La Prensa indicates nearly 60% of Panamanians believe the president was directly involved in the land deal and Varela claims it was a key issue in the breakup of the coalition. The media have seized on this issue as a defining point to criticize the president, as everyone in the capital is aware of the price of land in the current market bubble. Several lower level officials have been fired, targeted as scapegoats for the scandal.
Yet the land deal controversy hasn't stopped the president from continuing to push his political agenda. Martinelli says the CD will run its own candidate in 2014 and nearly everyone assumes the president will find a way to change the rules to make it a personal reelection campaign. Electoral reforms muddy the election financing - making them less transparent.
Meanwhile, amendments that could have helped prevent illegal money from businesses or organized crime failed the vote in the Congress. Local civil society groups see a weakening in the electoral rules with the most recent round of votes.
In spite of the corruption, the political threats, the media attacks, the breaking up of the governing political coalition and the loss of the Congressional majority, Martinelli still retains high levels of popularity. Since the firing of the vice president, polls indicate the president's approval rating has dropped, but remains above the 50% mark. Perhaps more importantly, the president's party claims to have signed up over 80,000 new members in recent weeks, giving them a new political edge. Protests against the president have also appeared, with some people using social media to organize regular displays of anger against the president’s policies, but they haven’t exactly grown into a “Panamanian Spring” movement.
The same brash style and right-wing populism that anger his opponents and lead to breakups with his allies has given the president a loyal following. Whether those supporters are attracted to the style, the substance or the political patronage, they have given Martinelli enough of a political base to claim the CD, the party he created just a few short years ago, as the strongest political force in the country. Long ago, before he was elected, some of Martinelli’s political opponents called him a right-wing version of Venezuelan President Hugo Chavez. Given how he is fighting dirty and winning, at least for now, the political battles of Panama, Martinelli may live up to that comparison.
On 10 September 2011, Honduran Minister of Security Oscar Alvarez resigned his post, pushed out by President Porfirio Lobo during a cabinet shuffle. When asked whether his resignation/firing was due to conflicts with the police, Alvarez responded, "Those of you who are good investigative journalists should find out." He then left for the US, indicating he did not believe it was safe for him to remain in Honduras.
02-Sep-2011 - Bolivia: Latin Surveillance: Bolivia
Investigations into the situation reveal multiple layers to the resignation, not just one reason. The dispute between the minister and the police chiefs is troubling and points to significant corruption and influence of organized crime in public institutions. However, other political disputes between Alvarez and Lobo suggest that there was far more to his firing that one single issue.
As background, Alvarez has held the post of Minister of Security twice - the second time after Lobo’s inauguration in January 2010. He previously held the same post under President Maduro. Alvarez is a hard line supporter of military and police security operations against organized crime. He is also a long time ally of the United States, having cooperated with the US on a number of initiatives over his separate terms as Minister.
During his first year in the Lobo cabinet, Alvarez was one of the few allies Lobo could trust as he faced pressures from the economic and political forces that had previously backed the coup. However, over the past few months, the minister of security evolved from one of the president’s closest allies within his cabinet to joining an alliance with an opposing faction within the Nationalist Party that is placing political pressure on the president.
At a strategic level, Alvarez’s record was not completely positive. While apparently committed to stronger security and police reform, the murder rate remained among the highest in the world and the police forces remain corrupt as before. Even Alvarez has admitted that he was unsuccessful in cleaning up the police.
Still, Alvarez was focused on the security agenda and he and Lobo cooperated on that front. In mid-August, following meetings with US officials, Alvarez made a public pronouncement that a number of top police officials were linked to organized crime, serving as “air traffic controllers” for the cocaine flights coming into the country. Others were working for local criminals involved in stolen cars. In all, Alvarez claimed he had a list of 14 corrupt police, later increased to 20 police and other officials linked to organized crime. However, he has not shared that list with others in the government, though the Attorney General has threatened to subpoena him for that list.
Alvarez kept pushing. He submitted a law to the Congress to expand his own authority to fire corrupt police officers. Alvarez also supported an extradition law and a reform of the tax structure to bring in more money for security issues and purchase military equipment. Alvarez went directly to the media and the Congress without clearing his legislative push with President Lobo. The president’s official reason for firing the minister was his unilateral legislative activity
Some of this activity may be linked to Alvarez’s own political ambition. Asked whether he was running for president in early September, the security minister did not brush away the question, instead fueling speculation that he hopes to run. His willingness to engage in presidential politics from his cabinet position angered Lobo, who has had a hard time maintaining legitimacy and support in recent months. Since resigning, it appears that Oscar Alvarez has aligned himself with Tegucigalpa mayor Ricardo Alvarez - another potential presidential contender - and against President Lobo in a major internal struggle within the Nationalist Party. As campaigning for the 2013 elections has begun early, the president’s own agenda has become crowded out by concerns over his political future.
In the wake of Alvarez’s resignation, changes have been made in the Armed Forces and Police leadership, but it is unclear whether those changes have hit the police officials that Alvarez believes are working for organized crime. Additionally, the security tax pushed by Alvarez in Congress has been quietly reformed to collect less money from key interests in the country including landowners and mining firms.
For all the political and criminal issues involved in the resignation, it’s of note that it had little or nothing to do with the ongoing conflict in Bajo Aguan, which has risen to a key security concern for the Lobo government. Landless peasants, who landowners accuse of acting as a foreign-trained armed insurgent grou, are battling against landowners, who peasants accuse of running human rights abusing paramilitary militias.
Local sources indicate organized criminal groups are playing both sides of the conflict. The criminals are striking deals with landowners to move drugs and arms while also working with the peasants to offer resources in exchange for logistics help. It is another issue that Alvarez often criticized but never got around to resolving. An order to send troops into the area to fight the “threat” from the peasants, while not cleaning up the corruption of the land owning class in the region, may turn out to be one of his biggest failures down the line.
The government of Bolivian President Morales went into damage control mode this week over allegations they are doing surveillance on opposition groups and foreigners in the country.
26-Aug-2011 - Venezuela: Hoarding Wealth and Chavez's Hedged Bets
As reported last week by Southern Pulse in a larger article about the region’s governments increasing their domestic surveillance capabilities, the government of Bolivian President Morales is using phone records they have obtained to accuse indigenous protesters of links to the US government. While the government meant for this to be an attack on the legitimacy of the protesters, they were surprised to find that many Bolivians questioned the legitimacy of how the government obtained those phone records.
As background, before this recent scandal, the Bolivian government already faced questions of whether it was attempting to increase domestic surveillance and whether domestic surveillance capabilities were being abused.
In mid-2008 and again in January 2010, the Morales government put forward a law that would expand the wiretapping capabilities of their counter-narcotics police, the FELCN. The law in 2010 included using counter-drug money to purchase new technologies to intercept digital signals. At the time, several opposition leaders expressed concern that the laws may be used to monitor political opposition.
In early 2011, several top corrupt officials within the Bolivian government including Coronel René Sanabria, the former head of the FELCN, were arrested for their links to organized crime. Bolivian authorities learned after those arrests that the intelligence gathering organizations had been infiltrated by organized criminal groups and the equipment used to monitor phone calls had been turned on rival criminal groups in order to take out the competition. Though this abuse of surveillance was not directly the fault of the Morales government, it exposed some of the concerns that others had about the initiatives.
In spite of those concerns, in late July, the government put forward a new telecommunications law. The main focus of the law was to regulate the radio spectrum and increase the number of pro-government indigenous radio stations. However, a clause within the law also created new legal authority for expanded phone taps by the Bolivian government. The clause says that telecommunications systems must cooperate with the government in cases of “danger to the security of the state, external threat, internal commotion or disasters” and provide the government full access to the “emission, transmission and reception of telecommunications.” When confronted about this issue by opposition politicians in July, Morales’s associates disagreed with the interpretation that the new law could be used for phone taps and said they never intended for it to be used for domestic spying, just for the broadcast of information.
The debate over this latest law had barely ended when Morales went on state television to claim he had telephone records proving a conspiracy between protest leaders and the US embassy. Minister of Government Sacha Llorenti provided further information the following day including cell phone numbers, the names of those involved and the times and locations of the phone calls.
The government has fumbled its response, taking almost a week to get a coherent and coordinated message. In the course of their various responses, the government raised more questions than they answered.
As a legal authority, the government pointed to a case that began on April 7th when Llorenti ordered the prosecutors office led by attorney Felix Perlata to open an investigation on several protest leaders from the Bolivian Central Workers Union (COB), who were protesting in La Paz. The charges against the protest leaders included “internal commotion”, which happens to be one of the reasons given in July’s law that the government can order the cooperation of telecom companies. That investigation, which the government says involved the use of state intelligence resources because some protesters carried dynamite, led them to two cell phone numbers that they believed were used to coordinate April’s protest events.
But how did the government authorize getting the records without ever appearing before a judge? Did the government consider constitutional articles that protect the right to organize before starting this investigation? Perhaps most confusing circumstance: how did phone calls from the April protesters, which were led by urban workers, miners, teachers and transportistas, lead to the government monitoring phone records from rural indigenous groups and US embassy officials?
During his first interview with the media on the manner, the attorney who requested the telephone records, Felix Perlata, could not remember when or how he ordered the investigation into the calls. He could not recall why an investigation into one protest group led to monitoring a completely different group and US embassy officials. Then, Perlata disappeared for several days with the government claiming he was ill. He came back into the media spotlight with slightly a more detailed story, but still missing some key components.
On 2 September 2011, the government insists that they never ordered wiretaps (“pinchazos”) which would allow them to listen in to conversations. They are particularly careful to note there were no wiretaps on the US embassy itself as this would be a major violation of diplomatic protocol (though they are less clear about cell phones used by embassy employees). They say they only monitored the phone records (“extractos”). This defense is a careful nuance of terms and it is not apparent that it is completely correct, as there is evidence some protest organizers from April did have pinchazos placed on their calls. However, even the information about the extractos appears to have violated Bolivia’s legal system according to local authorities.
Concurrently, the Bolivian government is using media resources owned by the state and off duty police to do surveillance of its political opponents as well. Journalists from Channel Eight covertly filmed a private party at the home of a member of Congress. Videos of the member of Congress drinking appeared on television as a punishment for his opposition to Morales. One indigenous protest leader reported being followed by a suspicious car, which was then involved in an accident. The license plates on the car were traced back to police in the region, but the government refuses to investigate the case.
While the officials in Morales’s government have been careful to walk a legal line in their comments about surveillance of protests, including their distinction between extractos and pinchazos, some allies and former allies have not. The head of one union said “of course” surveillance occurs to keep protesters in line while a MAS deputy in Congress insisted the government has every right to do whatever it can to investigate conspiracies and prevent protesters from destabilizing the country. Comments like that are not helping the damage control efforts of the president, whose legal team probably now recognizes that they crossed a constitutional line. Morales hopes to get the attention back on the conspiracies from abroad and not the conspiracies within his own government.
Ahead of the 2012 presidential elections and in the middle of cancer treatment, Venezuelan President Hugo Chavez has announced a series of moves to control Venezuelan gold production and his country’s tonnage of physical gold. His announcement to repatriate Venezuela’s gold reserves from international deposit locations has generated a media buzz and maybe on purpose. Underlying this tactic to redirect media attention lies a problematic situation with the Venezuelan gold sector and concerning political reasons for why Chavez needs to stash his cash close at hand.
26-Aug-2011 - Region: Latin Surveillance: Spy vs Spy
Even domestically, the issue of moving reserves distracted from the issues surrounding the domestic gold extractive sector. For the few international companies still somehow involved in that sector, the announcement has increased Canadian mining companies’ fears over nationalization. However, the local impact may be bigger with employees from Venezuela’s own mining company,CVG Minerven, currently in arrears over what are so far three weeks of no pay. A leader from the workers’ syndicate was quoted saying that apart from no pay, they don’t have financial support for maintenance and repairs. “If a pump breaks,” he said, “we have no way to fix it.” More over, the company reportedly has not recorded a profit in the past three years, despite historically high prices in gold, used by Chavez himself, in part, to justify why he wants to move the country’s physical gold stock in the first place.
The lack of focus on maintenance, investment in the day laborers’ safety, well being, or salary, is likely not new to CVG Minerven, and has been felt across various sectors: oil and gas, energy generation, infrastructure, food production and distribution, etc. Again, big plans and poor follow through speak of gross mismanagement, but in most cases also point to a well-oiled criminal machine at work. From the outside, a glance at CVG Minerven makes it too easy to conclude that anyone smart and capable is using their capabilities to enrich themselves and the criminal system while the rest are left to fend for themselves with irate workers, broken parts, and no money.
Corruption continues to play its chronic role. During the first week of August 2011, Minerva workers delivered a 400-page dossier that outlined specific cases of corruption, bribery, graft, and the illegal sale of gold. Whether Chavez read the report or not, his focus on nationalizing Venezuela’s gold sector was placed squarely on the shoulders of illegal miners, though there’s little confidence in national media and other sources in Caracas that suggests that the nationalization process will put a stop to illegal activity. Nevertheless, couching nationalization in crime stopping resonates with supporters downtrodden by the region’s most alarming and least reported public security emergency.
Still, the movement of international reserves captured far more media attention than the domestic issues. Several reports and at least one blog post this week outlined the logistical feasibility of transporting what could amount to as much as 211 tons of gold, broken into 40 shipments (link to Felix Salmon article). Apart from the risk incurred by transporting one shipment, finding someone to insure the cargo is another hurdle. Gold experts weighed in on the logic, or lack there of, for transferring physical gold, quoting estimated transactions costs versus the actual value of making a transfer. In short, there is no economic incentive to transport 211 tons of gold. This leads analysts to conclude it is either a media ploy or an attempt to consolidate control for personal good rather than the country’s economic stability.
The possibility that the gold may not come to Caracas has also been raised. Russian Foreign Minister, Sergey Lavrov, was recently in Venezuela and offered to store some of the gold bullion bricks in his country. Other possible candidates are the usual suspects: China and Iran. It would not be surprising for Cuba to be the next candidate for holding some gold as well following Chavez’s next round of medical treatment.
Whether the gold moves from London to Moscow or to Caracas is not as important as capturing absolute control over the wealth. However, Chavez’s decision to move all the gold to Caracas would indicate a high-level of paranoia. Displacing it with partner countries would at the very least indicate that he’s willing to trust his alliances, or at least his aligned colleagues within their countries.
The US Treasury Department has already frozen assets of specific Venezuelan nationals, at least one was part of Chavez’s administration. Recent reports from Washington have black listed Venezuela as not fully cooperating on terrorism while some in the US Congress have called for declaring the country a state-sponsor of terrorism. They may be “veiled threats” as Caracas has called the report, but Washington is vigilant and worried about the Venezuela-Iran relationship, soon to be boosted again with Ahmadinejad visits Chavez in Venezuela next month. Chavez rightly bets that gold reserves and frozen international assets could be on Washington’s backroom meeting agenda.
Wealth hoarding and control is a hedge. While it makes little sense for Venezuela’s economy, hoarding wealth in Caracas is not at all a bad strategy ahead of what could be a string of events that lead the world’s “aligned” Western countries, as opposed to Chavez’s bloc of “non-aligned” states, to seize financial assets. Chavez must balance the economic stability of his regime’s top leadership - not his country - against the possibility that world powers seize his assets in the wake of a grossly non-democratic maneuver, such as stealing the presidency, or declaring himself ruler despite poll results in late 2012 that clearly state otherwise. Having the gold under Venezuelan control also allows him and his domestic allies to walk away with a significant amount of liquid assets should they be forced out of office and out of the country, or in a unlikely but possible scenario: dig in and conduct an insurgent operation to retake control.
Now, a year ahead of the elections, Chavez is clearly less cocksure of a win than he was ahead of the 2006 election. His recent moves to control the country’s extractives sector - oil and gold - coupled with his moves to arm a militia that reports singularly to his command, and layered on top with a psyche going through cancer treatment hangs together a framework that looks like a level of power consolidation beyond what any democratically elected leader would require - but power a modern-day caudillo and member of a deviant globalized system would need.
Domestic spying is in the news this month in the Western Hemisphere. A subject that is often not discussed in formal settings has made its way to the front pages of at least a dozen countries in Latin America and the Caribbean over the past few weeks. The news includes phone taps, hacked emails, covert video surveillance and legislative debates over privacy online and offline. A confluence of events around the region and the globe as well as improved spying technology has pushed this trend into the open and could change how the spy vs spy, police vs crime and government vs opposition scenarios play out in several countries.
12-Aug-2011 - Colombia: Taking Measure of Santos' Consolidation Strategy
Certainly, there have been phone taps and secret recordings for decades in Latin America. Perhaps the most famous examples were the “Vlad-videos” in Peru under the administration of President Fujimori and National Intelligence Service chief Montesinos. What makes 2011 different is the surge in surveillance by governments across the political spectrum and the media providing increased coverage of the situation.
The technology and techniques are a mixture of old and new. Phone taps and illegal recordings are old technologies that have become more sophisticated while data mining of social networks is a new field that all governments around the globe are just beginning to understand. Private hacking gangs appear to have surpassed the capabilities of government intelligence agencies in terms of the ability to hack email and computers, creating a new black market for information trafficking.
It’s worth noting that the technology to encrypt data has also become cheaper and easier to use, but has not yet caught on in much of Latin America. However, the increased public nature of government and private sector surveillance should push an increased demand for privacy technologies in the coming year, both by criminal groups and civilians who want greater privacy from the government.
Some examples from recent weeks follow:
A New York Times article described enhanced intelligence cooperation between the US and Mexico that includes phone tapping technologies. The US has assisted in the creation of intelligence fusion cells in Mexico and is providing information to a vetted group of Mexican authorities so that they can conduct operations against criminal organizations.
In Honduras, an investigation revealed that the email servers at the presidential palace had been hacked, giving one or multiple organizations access to email, the presidents schedule and budget documents. Foreign government involvement does appear likely at this point. An Israeli firm has been hired by the government to provide increased cybersecurity protection.
Even as officials from the government of former President Uribe are being investigated for phone taps and domestic spying on judges and political opponents, the Colombian government showed off some new surveillance capabilities. Police utilized new online forensic capabilities and arrested a hacker who broke into the account of a journalist. The government, under attack by a local branch of the hacking group Anonymous, has announced they plan to have a new CERT agency online before the end of the year that can counter and investigate attacks.
In Venezuela, phone calls by opposition candidates have been recorded and played on state television as a way of embarrassing those politicians. It appears state intelligence is behind the tapping of the phones. This news comes just months after other sources indicated that Venezuela’s intelligence services, with the assistance of Cuban intelligence and private hacking groups inside Venezuela and Colombia, have hacked into the private email accounts of journalists and politicians and have stolen their messages for at least the past five years.
In Bolivia, the government tapped the phones of indigenous protesters and US embassy officials. President Morales then revealed phone calls made between the two groups as a way of showing a plot against his government. In the process, he showed that his government is tapping the phones of political opponents and foreigners living in the country.
In Argentina, a number of private emails by Kirchner government officials recently appeared on a website “Leakymails.” There are three aspects to this scandal worth considering. First, the content of the emails contains personal information about key political officials. Though most of the emails released are rather boring, one set of emails does appear to link a government-backed candidate to organized crime. Second, the question of how the emails were obtained may point to the state intelligence service or former officials within the intelligence service committing domestic espionage. There are indications outside non-state groups hacking into government officials’ email account. Third, an Argentine judge ordered local ISPs to block the Leakymails websites. This opens a new chapter in web censorship in Argentina and the region and places the question of how private ISPs filter Internet content directly onto the policy agenda.
The government of Brazil fined Google for failing to reveal identifying information about an Internet user. According to Google, Brazil is the top country in the world for making requests to obtain user information or to block search results through legal actions. Part of this is due to Brazil’s speech laws that give public officials broad sway on any issue that could be considered libel or slander.
Similarly, the government of Ecuador is considering passing a law that would require Facebook and Twitter to provide information about anonymous postings based out of that country. Though President Correa has backtracked on his initial request, draft versions of the law suggest an expanded government authority to track the identity of users online.
The governments of Chile and Brazil have said they are starting to monitor social media sites as a way of detecting criminal activity as well as potential social unrest. For Brazil, this operation has included a military unit dedicated to cyberwarfare and cyberdefense. This unit is also receiving training from Israeli and US firms in offensive operations in the cyber-domain, the first Latin American government to admit that publicly. For Chile, the monitoring of social media has made the government a target for the international hacking group Anonymous, which is also attacking government websites as a way of supporting recent protests by student groups. Chile’s domestic cybersecurity units, particularly those within the police, are now forced to increase their capacity to handle the incidents.
The issues reported only hint at some of the issues that remain hidden from public view. Police and intelligence organizations across the region have expanded their capacity for surveillance in recent years and a number of foreign firms from the US, Europe and Israel are assisting them in that effort. Meanwhile, criminal groups have banded together with hackers from Eastern Europe and Russia to enhance their technological capabilities to steal government and corporate information.
Back at the regional level, Latin American intelligence agencies are running into the same problem as their developed world counterparts: how do they analyze all the data they collect? The ability to collect and store data is moving more quickly than the ability to process, analyze and utilize it. For Presidents Chavez and Morales, who have very specific political targets for their intelligence collection campaigns, this has not been much of a problem. However, for Mexico, Brazil and Colombia, whose intelligence efforts do focus on organized crime (in spite of some high profile scandals in which they don’t), they cannot keep up with the data in a timely fashion. All three countries are known to have missed arrest opportunities in which they had data about a relevant target but did not filter it out of their mounds of data quickly enough to operationalize it.
Lurking among all of these government-related surveillance and privacy issues is an increase in private sector and corporate espionage in the region. Much less reported, companies have had gigabytes of data stolen by local private hacking groups and foreign governments from Eastern Europe and East Asia. In various surveys, over half of corporations in the region report being victim of cyberattacks and theft of data. These corporations, when they manage to detect the problem, generally do not report the problems to the governments. While it is apparent from the above examples that governments have plenty of surveillance issues on their plate, this private sector surveillance challenge cannot be ignored. The threat that some corporations and criminal groups may surpass local police and intelligence agencies in their surveillance and spying capabilities can be a problem for the future security of these states and the civil rights of their populations.
Just a few days into the second year of Colombian President Juan Manuel Santos’ administration, his popularity rate remains among the highest in the region, despite ongoing security challenges that could surface in a variety of ugly ways leading up to the October local elections. In August 2010, the Santos administration brought an unprecedented level of continuity from the previous eight years of former President Uribe’s Democratic Security strategy, tweaking the security strategy in name - from security to consolidation - and focus - from insurgency to criminal bands. Under the title of Democratic Consolidation, Santos’ strategy has focused on consolidating state power in formerly volatile areas of the Colombian countryside, where his predecessor performed a clear and hold operation, followed by an injection of government services. Before these pockets of state presence collapsed, Santos’ plan sought to consolidate the state’s presence in the zones through the further pruning of criminal activities.
12-Aug-2011 - Brazil: Amorim Takes Over as Defense Minister Amid Concern
As ever, the FARC remains a constant target and the hunt for FARC leadership draws significant military and intelligence resources. In response, the FARC have increased their attacks over the past year, and Santos has been forced to defend his strategy against criticism in the media and even by the former government about his handling of the security situation. He needs to show results on the FARC operations to maintain high approval ratings.
However, even as the FARC receive significant attention, the government has also placed increasing offensive focus on criminal bands such as Los Rastrojos, Urabeños, and Paisas, which they recognize as a group that collectively threatens to erode the security gains made under Uribe faster than the FARC.
Through a series of operations, dubbed alternatively in Colombian press as Operation Troy and Plan Troy, these offensive pushes into the Caribbean (February 2011), Pacific (May 2011) and - in two weeks - Choco (30 August 2011) regions of Colombia have so far netted mixed results. The government is quick to tout statistics in the drop of homicides and the names and faces of so-called cabecillas of the Rastrojos, Urabeños and others. But as Southern Pulse has previously reported, an atomization strategy that focuses on removing criminal leaders provokes an increase in volatility not security. The most recent high-ranking Rastrojos commander to fall was, Angel “Sebastian” de Jesus Pacheco, who was killed on 25 July in a municipality of northern Antioquia by his own bodyguards. Their motive remains unclear, though the results are clear: Pacheco’s death opens space for other leaders to try to fill, and could lead to an increase in violence as rival groups try to fill the power vacuum. The resulting violence, as others have concluded, is just one example of how many of the areas targeted for consolidation have moved in the opposite direction; they are more violent under an increase in state presence.
The most recent Plan Troy announcement, made earlier this month, will focus on Choco and the regions of Colombia where the federal government is most concerned about election-related violence. This likely will include an increased presence in the region of Bajo Cauca, formed by six nothern municipalities in the Cauca River valley of Antioquia department. This zone is a critical path for drug trafficking through Colombia, and control of this plaza - to borrow the Mexican term - has concentrated a variety of groups all struggling for control, including the FARC, the Rastrojos, and the Urabeños.
As the government continues to net arrests of low-level operators, kill or arrest mid-level commanders, or force internal disputes (a possible explanation for Pacheco’s death), the rules of atomization are likely to play out in Colombia, as they have played out most recently in the Mexican states of Jalisco and Michoacan. A strategy that pursues this path works only if the government removes leaders faster than the groups are able to reconstitute themselves. Indeed, in Colombia, with the exception of the FARC’s highest commanders, the life cycle of criminal leaders is significantly shorter than that of leaders in Mexico. While the so-called kingpin strategy is problematic in Mexico, taking out high and mid-level leadership has traction in Colombia. Swift action on criminal leaders relies heavily on professional security forces and human intelligence networks.
Colombian Defense Minister Rodrigo Rivera recently announced that the government would triple the size of the military intelligence group, and coordinate intelligence collection, sharing, and action across various military groups through the recently dubbed Intelligence Fusion Center. Rivera also plans to double the size of the national police intelligence collection operation. Both efforts will likely prove to be good investments as the Santos administration moves forward with a multi-pronged approach to consolidating state presence while combating various and disparate groups. Yet while Colombia is strong on the offensive and intelligence side of operations, it is woefully lacking in follow through.
The country’s judicial system remains one of the greatest impediments to completing a cycle of investigation, arrest, trial, and imprisonment or extortion that continues to count an impunity rate hovering at 90%. Other internal challenges include collusion between local politician and criminal bands, whether under duress or not, and cooperation between members of the police and military, and criminal bands. When 20 members of Los Rastrojos were arrested on 4 August 2011, seven of the accused were active duty policemen; three were military soldiers. Pacheco allegedly paid the men just over US$1,000 a month for their protection services.
The collusion between the FARC and criminal bands is another concern. Even as they compete over territory and routes in some areas, the ties that bind these groups facilitate business and logically the strength of these groups, who work together in 11 of Colombia’s 32 departments. Fighting between criminal groups is bloody but weakens them, allowing government forces to pick-off the survivors while they are still weak. The links between Colombia’s domestic criminal groups is necessary for business, driven largely by the Mexican criminal system - rooted in Colombia to ensure resource security.
A separate external factor is a decline in US government aid and focus for military training and support in Colombia. Washington’s focus has arguably shifted north to Mexico, where the front lines of its drug war have been drawn congruent to the US-Mexico border line.
Marching into his second year in office, President Santos must keep careful aim on several moving targets. He must maintain equal pressure on criminal bands and the country’s insurgent groups in several pockets across the country while disallowing displacement into Colombia’s neighbors and preventing the advance of Mexican criminals into his country. And that’s just his security challenge, apart from economy, judiciary, and ongoing corruption scandals hungover from Uribe’s administration. In October, we will have another opportunity to review his national security strategy. So far, the potential for violence across the country in two months does not point to a promising future for thousands of Santos’ countrymen who must live under the control of criminal groups. Nor would peace, as it is a Latin American hallmark of absolute criminal control and a thriving criminal business enterprise.
Already facing multiple corruption scandals, the resignation of two ministers and the arrests or investigations into various other officials, Brazil President Rousseff was forced to fire her minister of defense, Nelson Jobim, last week due to various political comments he made in the media. His replacement, Celso Amorim, may be a major shift in this key ministerial post.
Jobim was already under intense media criticism after comments in the media hinted he believed those around him were idiots. He also claimed he voted for Rousseff’s opponent in last year’s presidential election. While voting for Jose Serra was not a disqualification for serving in the Rousseff administration (some may argue it helps show her as tolerant of diverse political views), it came across as a subtle criticism of the president’s agenda that was already under fire in the media.
The last straws were two media reports in mid-August 2011 in which Jobim was quoted as calling one cabinet minister a “little weakling” and claiming Rousseff’s new choice for chief of staff “doesn’t even know Brasilia.” The first comment was a leak and Jobim denies making the second comment, but coming on the heels of his other recent foot-in-mouth statements, it pushed Dilma to act.
Unlike the other two cabinet ministers forced from office, Jobim was not someone clearly in the Lula camp. He is a member of the PMDB and served as minister of justice under President Cardoso in the mid-1990’s. Even as he served in the Lula government, he almost always appeared to be more conservative than others in the cabinet. He had even appeared initially reluctant to take the position in the Rousseff administration.
As minister, Jobim was one of the most influential cabinet members in both administrations and as he exits public service leaves a significant legacy in terms civilian leadership of the Brazilian military. The Defense Ministry under Jobim made significant progress on updating its strategy and modernizing the force. It made a push on procurement of modern weapons; faced the greatest single day loss of troops since World War Two in the January 2010 earthquake in Haiti and then maintained leadership of that peacekeeping force through the tough post-quake rescue, recovery and reconstruction period; began urban combat operations in Rio to take back favelas ahead of the World Cup and Olympics; and, expanded rural operations along the borders to combat illicit trafficking by criminal organizations. Jobim also shaped the South American Defense Council into an organization with the potential to bring regional military leaders together under Brazil’s leadership.
The naming of Lula’s Foreign Minister and well-known leftist political battle axe Celso Amorim to replace Jobim breaks the recent trend of Rousseff pushing out key figures from her predecessor’s administration. Amorim is clearly an ally of Lula, more so than Jobim. His appointment also brings in a seasoned political veteran into an administration that had been recently criticized for having too many political neophytes in place to manage relations with Congress and the other political parties.
Despite his veteran status, Amorim’s appointment is not going over well with a military already hesitant about President Rousseff. One anonymous military officer was quoted by Folha de Sao Paulo and Reuters as saying, “Since when do diplomats care about war? It's like sending a doctor to take care of a morgue.” There was also a protest by military spouses over low pay and poor equipment. Jobim was generally able to play a good middle ground between the military and the government looking to prosecute dictatorship-era abuses. There are concerns among officers that Amorim will not stick up for the military during the inter-agency battles to come.
Upon taking the defense minister position, one of the first announcements made by Amorim is that he is considering pulling Brazil out of the MINUSTAH UN peacekeeping mission in Haiti. This would be a huge blow to the UN presence in Haiti and could trigger a series of withdrawals by other Latin American governments, who are necessary for the force structure as well as its image of legitimacy. While Jobim had defended the Brazilian military presence in Haiti, several left-wing politicians in the Congress have repeatedly criticized the mission and demanded withdrawal. The Brazilian public isn’t significantly in favor of or against the mission and there aren’t many champions for the mission, even within the Brazilian military, so it’s a safe stand for Amorim to take to signify a change without angering any political stakeholders.
Whatever his knowledge of military affairs, Amorim is certain to easily settle into the political and foreign relations aspects of the defense minister position. That will have both positive and negative effects for the region. On the positive side, Amorim could serve as an important moderating force for some of the militaries who are becoming too politically involved in their countries, including Bolivia and Venezuela. On the negative side, Amorim is likely to see the South American Defense Council as primarily a political tool rather than as an institution for military to military cooperation, which would be a loss for the growth of UNASUR.
On procurement issues, Amorim’s new position may push the US and Brazil further apart. While Jobim was open to the Boeing F/A-18 bid and Rousseff has even indicated she may support the US planes if the bid continues, Amorim was among those in the Lula administration strongest against going with the US jets and in favor of the French Rafale. Meanwhile, Amorim’s political leanings are going to provide ammunition to those in the US who oppose giving Embraer military contracts.
As an immediate challenge to Amorim, a top Brazilian general was implicated in fraudulent contracts according to an investigation by regional media including Folha de Sao Paulo and the Argentine newspaper Pagina 12. General Enzo Martins Peri, the commander of Brazil’s Army, is one of eight military officers linked to 88 fraudulent contracts worth over US$7 million.
Upon choosing Amorim, President Rousseff said that she was sure he would be a quick learner on military strategy and defense issues. The military is concerned that the president just placed an opponent as their civilian leader. Yet, in spite of the concerns, Amorim’s early statements indicate he wants a Brazilian military that needs the equipment and training to defend Brazil’s sovereign territory. The former diplomat may yet find common ground with the military leadership on those issues, and other core issues, including the protection of the so-called Blue Amazon, or Brazil’s oceanic territory. Still, Amorim’s contentious nature and highly-trained verbal swordsmanship may not serve as the best match, and an indication of Dilma’s limited range of options and insight into her government’s structure and culture beyond the executive office.