The unlikely island of Guam has become the crossroads of the subterranean drug traffic. Millions worth of heroin, opium and marijuana are routed through Guam to underworld drug dealers in the United States.
The international narcotics racketeers keep shifting the hub of their smuggling network from one airport to another. They have moved the operation like a floating crap game from Miami to Asuncion to Panama City to Hong Kong. Now they have settled, at least temporily, on the picturesque little volcanic island of Guam in the mid-Pacific.
Secret intelligence reports describe how narcotics are smuggled through the Guam gateway. Heroin has been secreted in the household effects of U.S. personnel returning home from overseas. It has been packed between the double walls of vases which, one report explains, "have to be broken to determine the contents."
Couriers have carried up to a pound of heroin strapped to their waists. Young women have been caught "with heroin taped to their legs or in body cavities."
The ground crews of a major airline, according to one intelligence report, are working with the smugglers. "Unwitting flying personnel" from the two Air Force bases on Guam "may also be used" the report suggests.
The intelligence reports identify one smuggling ring by the nickname "Mog Fog." This underground organization channels an incredible $12 million worth of heroin through Guam each month, plus a high-potency, opium-coated marijuana concoction known in the drug culture as "Thai sticks." The authorities have no accurate estimate how many of these deadly delicacies are distributed through Guam.
"Mog Fog," according to a secret report, "is based in Guam, with branches in Bangkok, Hong Kong, Manila, Honolulu, California and New York, with connections in Missouri, Nevada, Texas, Illinois and Connecticut."
The heroin trade generates "ten of billions" of dollars each year. The profits are enormous, yet so elusive that the authorities don't have a solid estimate of the amount. But some idea of the high stakes can be gained from the profit margins. A kilogram of pure heroin, costing $15,000 at the source, may eventually be worth $1.5 million in the streets.
This dirty money is laundered primarily through foreign banks. The drug smugglers used to hide their illegal profits in Swiss and Mexican banks. But both countries have become more cooperative with the U.S. authorities. So today, the racketeers stash most of their heroin returns in Caribbean banks.
The banks of the Bahamas, Cayman Islands, Haiti, Jamaica, Netherlands Antilles Islands and Panama are doing a booming business in dirty money. Most of the banks are branches of distinguished U.S. banks. These overseas branches are virtually free of the reporting requirements, which make it difficult for the home offices to handle mob money.
An astonishing 75 U.S. banks have offices, for example, in the Bahamas. Thus the Bahamas have more American banks than do the states of Alaska, Arizona, Delaware and Idaho combined. The Cayman Islands, to name another unlikely banking center, has 51 American banks.
Intelligence sources also suspect that major drug dealers keep anonymous accounts in certain banks in Bangkok, Hong Kong and tiny Liechtenstein. Middle Eastern dealers, who smuggle Afganistan heroin into Europe with a smaller flow into America, reportedly do their banking in Iran.
At the end of the economic chain are the street people -- teenagers who earn $50 a day acting as lookouts for the pushers in Harlem; spikers who for $5 will help an addict find a vein that hasn't collapsed from repeated puncturing; couriers, bagmen and gunsels who handle the dope, and finally, the street dealers who peddle the stuff to the addicts.
Footnote: The Customs Service, given its manpower shortage, is remarkably effective at intercepting smuggled narcotics. But tracking the dirty money is one of the most difficult investigative chores in law enforcement. The Internal Revenue Service set up a special unit in 1970 to concentrate on the drug racket. But for a mix of reasons, ranging from tightened laws to bureaucratic politics, the unit has been disbanded. The Drug Enforcement Agency, meanwhile, has acquired a full-time "dirty-money" expert.