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    Russian Mob, Drug Cartels Joining Forces

    By Douglas Farah
    Washington Post Foreign Service
    Monday, September 29, 1997; Page A01

    MIAMIóRussian organized crime groups, flush with dollars, are forming alliances with Colombian drug traffickers in the Caribbean, acquiring cocaine for delivery to Europe and providing weapons to Latin American mafias, according to U.S., European and Latin American law enforcement officials.

    THE RUSSIAN CONNECTION

    Russian crime groups operating out of the United States and Puerto Rico have formed coalitions with Colombian drug trafficking organizations exchanging weapons for cocaine. The drugs are shipped mostly to Europe and the proceeds laundered through offshore banks in the Caribbean. Here is a look at how these transactions work:

    1: More than 30 Russian organized crime groups operate out of Miami, New York and Puerto Rico arranging arms-for-cocaine deals with partners in Russia.

    2: Organized crime groups in Russia, which looted the crumbling Soviet state enterprises, buy shiploads of weapons in Russia and Eastern Europe, including rocket-propelled grenades, for shipment to Colombian or other ports.

    3: The weapons are bartered for refined cocaine from Colombian cartels.

    4: Cocaine is shipped to Europe; some may also end up elsewhere.

    5: Russian crime groups have set up banks in the Caribbean to launder money electronically. They have also set up front companies in the Caribbean and Miami for laundering purposes.

    The Russian groups, operating out of Miami, New York and Puerto Rico, also are opening banks and front companies across the Caribbean, largely used to launder hundreds of millions of dollars from drug sales and other criminal activities, the sources said.

    In interviews in Miami, New York, Puerto Rico and Colombia, law enforcement officials and experts on Russian crime cautioned that the growing number of alliances between Russian and Colombian criminal organizations is the most dangerous trend in drug smuggling in the hemisphere. Barry R. McCaffrey, the Clinton administration's national drug-control policy director, said, "the Russians, along with the Nigerians, are the most threatening criminal organizations based in the United States."

    This is because, according to McCaffrey and others, the Russian organizations offer drug cartels access to sophisticated weapons that previously were beyond their reach. The Russians also provide access to new drug markets in Russia and other former Soviet republics at a time when consumption is falling in the United States.

    In particular, the sources said, recent undercover operations have detected attempts by Russian groups to sell Colombian drug traffickers a submarine, helicopters and surface-to-air missiles. Officials said that at least two Russian combat helicopters, along with small arms, have been sold to Colombian organizations.

    Access to surface-to-air missiles would give traffickers an effective method of attacking helicopters, which law enforcement agencies use to move troops quickly to attack cocaine and heroin laboratories in hard-to-reach jungle outposts. And armored helicopters would give traffickers a more secure means of transporting drugs and thwarting raids.

    Russians suspected of ties to organized crime groups have opened more than a dozen offshore banks around the Caribbean and have paid millions of dollars in cash for some of the priciest strip clubs in southern Florida. Federal officials say that both the banks and the clubs are useful for laundering drug money. Many of the banks are linked to banks in Russia that also are controlled by organized crime. This gives both the Russians and allied Colombian groups access to new markets and ways to launder money, just as the United States, Europe and some South American countries are moving aggressively to seize drug trafficking profits.

    While Russian organized crime groups have been active in the United States for two decades, only recently have they become involved in

    drug trafficking and money laundering in this hemisphere. In the past, the Russians have been linked to kidnapping, extortion, prostitution and gambling.

    "We have identified a number of Russian organizations in the Caribbean and see a dramatic increase in their investments in hotels and gambling," said Felix Jimenez, the Drug Enforcement Administration's special agent in charge of the Caribbean, based in San Juan, Puerto Rico. "There are Russian organized crime families based in Miami and New York that have strong ties to Puerto Rico. They are very tight organizations, very difficult to penetrate, and they present us with language problems. Gathering intelligence is a problem."

    The Caribbean, according to law enforcement sources, is especially attractive to Russian criminal syndicates already entrenched in Europe, where there is a lucrative, growing market for cocaine in the former Soviet Bloc nations. With strict bank secrecy laws and lax financial enforcement mechanisms, such Caribbean islands as Antigua and Aruba, where Russians have recently opened offshore banks, offer havens for large sums of money from criminal enterprises that would raise questions in other countries.

    "What makes the Russians so dangerous is that they are capable of so much; they are so sophisticated," said a senior Russia expert with the DEA. "We are talking [about] people with PhDs, former senior KGB agents with access to sophisticated weapons, people who have [already] laundered billions of dollars."

    "The Colombian groups are one-dimensional -- drugs," one investigator said. "The traditional mafia is limited, but the Russians have hundreds of gangs with thousands of people around the world."

    U.S. and European intelligence officials said they have reports of recent meetings between Russian organized crime figures and representatives of the Cali cocaine cartel on the islands of Aruba, St. Vincent and Antigua. The officials said the meetings appeared to be aimed at laying a foundation for long-term deals to supply weapons to the Colombians in exchange for cocaine to supply the rapidly growing market in Russia and the rest of the former Soviet Bloc nations.

    In the past three months, the officials said, several Russian vessels have entered the northern Colombian port of Turbo and are believed to have unloaded shipments of AK-47 assault rifles and rocket-propelled grenades in exchange for drugs. It is perhaps a measure of the general level of violence in Colombia that authorities do not know whether the weapons went to Marxist guerrillas, right-wing paramilitary organizations or the Cali drug cartel.

    Jim E. Moody, who investigated Russian organized crime for the FBI from 1971 until retiring as deputy assistant director of the criminal division last year, said that what is striking about the Russian organizations is that they, unlike other crime groups, appear to be willing to make deals with anyone.

    "When they overlap with other criminal groups, they tend to set up cooperative efforts," Moody said. "They learn from the other groups, and they work together. No one else does that." Moody said that more than 30 Russian criminal organizations are now operating in the United States, including several that simply transplanted themselves from Russia to Miami.

    In the early 1990s, according to Russian experts, a consortium of Russian organized crime leaders sent Vyacheslav Ivankov, a well-known mob figure, to the United States to move Russian criminal enterprises here and expand their operations. Ivankov was arrested in New York on extortion charges in June 1995 and remains in prison, but he was responsible, according to federal authorities, for expanding the reach of the Russians to Miami.

    In Miami, Ivankov allegedly frequented a nightclub and strip joint called Porky's near the international airport, which beckons prospective clients with pink neon lights urging them to "Get Lost in the Land of Love." Porky's was owned by another reputed Russian mobster, Ludwig Fainberg. Known as "Tarzan" because of his long hair and muscular build, Fainberg was arrested in February in a case law enforcement officials said shows how close the Russian organized crime groups and the Colombian cocaine cartels have become.

    According to the indictment, brought after a three-year undercover investigation, Fainberg and others used Porky's as a meeting place to arrange the sale of at least two Soviet military helicopters to the Cali cartel. According to officials, they also were negotiating to sell the cartel a Tango-class diesel-powered patrol submarine to be used to move cocaine from Colombia to the coast of California. The submarine was based in Kronshtadt, a large Russian submarine base on the Gulf of Finland, off St. Petersburg.

    During the negotiations, according to law enforcement officials familiar with the operation, the price of the submarine, which included a crew of 20 for a year, dropped from $9 million to $5 million. The deal fell through when the Colombians backed out, apparently feeling such an enterprise was too ambitious.

    Fainberg's lawyer, Louis J. Terminello, said in an interview that his client "talks way too much and has a big mouth," but declared that there was "not one scintilla of evidence" linking Fainberg with Russian organized crime.

    In late 1996, U.S. and British officials discovered that Russian companies, some with known ties to organized crime groups in Russia and the United States, had opened at least nine offshore banks in Antigua. Under heavy pressure, the island's government promised to review the status of the banks, but most continue to function. Intelligence officials said five new Russian banks recently opened in Aruba. Both islands are noted for strict bank secrecy laws that make it virtually impossible for foreign law enforcement agencies to trace the origin of funds.

    In July, following a two-year undercover operation here, federal officials arrested two Lithuanian nationals after they allegedly tried to sell Russian shoulder-fired surface-to-air missiles for $330,000 to undercover agents posing as Colombian drug dealers. The weapons were to be routed through Bulgaria to Puerto Rico and then Miami, officials involved in the case said.

    "American law enforcement is not organized to fight this threat," said a senior law enforcement official. "We are in for a long, long battle, and we are sort of outnumbered at this point."

    © Copyright 1997 The Washington Post Company

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