• Michael Padilla-Pagan Pay

The Red Dawn: The Terrorist Next Door, Drug Cartels and Middle East Terror Group.

Do you remember in 1984 a movie called Red Dawn? The film is set in an alternate history timeline in which the United States is invaded by the Soviet Union and its Cuban and Nicaraguan allies. However, the onset of World War III is in the background and not fully elaborated. The story follows a group of American high-school students who resist the occupation with guerrilla warfare, calling themselves Wolverines, after their high-school mascot. Sounds highly unlikely, doesn’t it?

2018 and now we have in the United States’ backyard, terrorist’s groups originating from the Middle East increasingly cooperating with local criminal elements and drug cartels. Why are they there? One might say that need makes strange bedfellows, but reality is far more complicated than that.

Pay attention to your backyard.

One does not immediately associate Hezbollah and Iran with Latin America. Nevertheless, both have been active there since the 1980s – taking advantage of corrupt governments, porous borders and occasionally collaborating with certain administrations particularly ripe with anti-American sentiment. Hezbollah, with Iran’s guidance, have used the region as a marketplace, selling drugs and laundering money back to Lebanon. Such activities pose serious risks and demand renewed international attention. That increasingly complicated web of terrorism and criminality is bound to create chaos and contribute to violence and instability.

The new Terror Hybrids:

Terror is very big business, a-regrettably- thriving industry. And I do mean that in the literal sense. Groups such as ISIS and al-Qaeda succeeded in gaining a degree of legitimacy for their cause by dressing it up as a twisted heavenly mission. They are now viewed globally as Muslim fanatics rather than the hardened criminals, money launderers and drug lords that they truly are. In this instance, the earthly issue lying behind the cosmic impulse is illegal drugs. Hard to argue with the divine, isn’t it?

Over the past 30 years significant links have been made between terrorism and the drugs trade. Such “hybrids” of global drug trafficking cartels and terrorist organizations use ideological motivations to mask financial ones. It is estimated that the majority of terrorist organizations have direct links to trade of illegal drugs, and the figure has grown in the past decade. Strip the ideological conflict, the religious connotations, reject the religiously polarizing rhetoric of our leaders and theirs, and you end up with the -criminal- familiarity that has mostly to do with earthly concerns rather than divine aspirations.

The next instability area:

Overall, Latin America, Central America, and the Caribbean offer Iran and Hezbollah fertile territory to build relations, bolster economic development and spread their ideology. Their efforts are made easier by governments such as Bolivia, Venezuela, Nicaragua, and Ecuador, whose hostility to U.S. interests manifest as non-cooperation on U.S. counterterror and defense partnerships. The Iranian regime also associates with the Bolivarian Alliance of the Countries of Our America (ALBA), a group created by Fidel Castro and Hugo Chavez, which resists the United States through political and economic means.

What is perhaps the most worrisome tactic of Iran and Hezbollah is the use of seemingly innocuous acts of diplomacy to obscure drug smuggling and money laundering. According to the U.S. government, Iran has relied on Latin America to evade sanctions by signing economic and security agreements in order to create a network of diplomatic and economic relationships. 

To further reinforce these strategic alliances, Iranian Foreign Minister Mohammad Javad Zarif embarked on a six-nation tour of Latin America stopping at Cuba, then Nicaragua, Ecuador, Chile, Bolivia and Venezuela in August 2016. Moreover, Mahmoud Ahmadinejad made six trips to the region between 2005-2012 to forge and strengthen relationships. This kind of focused diplomacy undercuts much of U.S. efforts to counter Iran’s nuclear program, as the United States’ leverage relies on international consensus and support to do so. But that international support is neither universal nor consistent.

How to fund an operation: Convergence is the way to go!

Terrorist organizations have chosen to participate in the narcotics market for several reasons. State sponsorship of terrorism is seemingly declining.  Terrorist groups, therefore, are increasingly in need of new sources of funds. The drug business fills this need perfectly. ICESERVE24 has estimated that revenues from other types of illicit transnational activity, such as arms trafficking and alien smuggling, pale in comparison. Drugs provide many different avenues of revenue, including the taxing of farmers and local cartels, and the provision of security for all aspects of production, trade, and distribution. Terror organizations do not, in general, require massive sums of money for their operations, but must finance training, infrastructure needs, equipping their members, bribing local officials, recruiting, and logistics. There are many similarities between a terrorist organization and a global drug cartel. Both oppose nation-state sovereignty, function best in ungoverned spaces, depend on mutual shadow facilitators, have no regard for human rights, rely on the hallmarks of organized crime such as corruption, intimidation, and violence, and are highly sophisticated organizations that operate with the latest technology. ICESERVE24 analysts see that terrorist groups copied their decentralized structure of cells and nodes from drug cartels. Both groups like terrorist and drug cartels often rely on the same money launderers and have a capacity to regenerate themselves when dealt a blow, often reemerging in a new or unrecognizable form. The main difference is motivation; drug cartels are motivated entirely by profit, whereas terrorist organizations have political or ideological frames of reference. Don’t be mistaken though, as to the extent of violence, terror, crime that is inherent in both. The convergence of these two groups has progressed rapidly over the past 25 years. Advances in technology and commerce that have benefited society and the economy have helped fuel the growth and expansion of such groups and also provided them new means for their illicit operations.

 Wild west is Latin Americas

A region of special concern in Latin America is the lawless area bordering Paraguay, Brazil and Argentina or aka Tri Border Area. This territory has been identified as a hotspot for money launderers and is yet another area Hezbollah and Iranian operatives use to raise funds. Eastern Paraguay’s Ciudad del Este, meaning “City of the East,” is the de-facto capital of this Tri-Border Area (TBA). TBA might seem like a far-flung region with little relation to the fertile valleys in Lebanon, but Lebanese comprise the overwhelming percentage of Arabs in Latin America. In fact, Latin America has the largest Arab population outside the Middle East, due to many fleeing wars and unrest during the late 19th and 20th centuries. Identifying the TBA as an area of concern is nothing new. Allegations that Hezbollah has ties to criminals operating in the tri-border region date back to at least 2006.  It has been estimated that Hezbollah cumulatively nets some $20 million annually from the TBA alone, though other estimates put the figure higher. It appears that tri-border “business” is a lifeline of revenue for Hezbollah and, therefore, highly valuable.

In addition to drug peddling, Hezbollah and Iran are able to partially bypass U.S. sanctions by taking advantage of a scheme known as ‘nesting’. Nesting refers to when a foreign financial institution gains access to the U.S. financial system by operating through a U.S. correspondent account belonging to another foreign financial institution. In other words, countries and individuals can avoid sanctions by establishing relationships with banks from other nations who have legal access to the U.S. financial system. The U.S. bank is often unaware that its foreign correspondent customer is providing such access to a sanctioned third-party and despite increased regulation, efforts to detect criminal and terrorist abuse of banks remain limited. 

Iran and Hezbollah and others will continue to expand their influence in Latin America. With so much going on in the Middle East, it is understandable why international attention has not been devoted to these issues. However, there is too much at stake to ignore the potential threats growing in the United States’ backyard as well as in Europe’s as well (which is a different topic). Whether Iran and Hezbollah use the region to circumvent sanctions, traffic drugs, launder money or plan future attacks, there is a real and growing threat. A threat that can soon materialize in ways hard to predict or prevent, in our own back yards.  As the boundaries become obscure, criminality and terrorist fuse together into one greater synergistic evil that crosses over into our daily lives, one that would take more than prayers and wishes to address effectively, once and for all. 


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