WHY IT TOOK 30 YEARS TO BUST A CRIME FAMILY

Sophisticated crooks find Canada a safe haven

Toronto -- It was the kind of day police dream of: 14 people charged in
North America, including alleged mob kingpin Alfonso Caruana, a truckload of
seized cocaine, and a heavily attended press conference starring the forces
of law and order.

And if Mr. Caruana really is the Wayne Gretzky of the drug trade, as police
suggested Wednesday when they busted him, then this was the police
equivalent of a Stanley Cup win.

"This organization has been recognized as the largest, most powerful
drug-smuggling and money-laundering operation in the world," RCMP Inspector
Ben Soave said of the Cuntrera-Caruana crime empire.

And then came the kicker: Insp. Soave acknowledged that police across the
world had been aware of the operation for 30 years.

What took so long?

There are numerous reasons, notably the skill and cunning of the suspects,
whose ever-shifting enterprise was one of Byzantine complexity and whose
lives offered little evidence of crime.

Global in outlook, technologically sophisticated and extraordinarily mobile,
organized crime in Canada reaches into the nation's economy and social
fabric as never before.

But in an era of slashed budgets, weak bank-reporting legislation and public
indifference, law enforcement has rarely been so badly outgunned, police
say, and this has turned Canada into a huge, soft target for an
ever-changing cast of villains.

>From drug-trafficking to credit-card fraud, from counterfeiting to
extortion, from the smuggling of stolen luxury cars and cigarettes to a
money-laundering industry profiting mightily from the proliferation of
casinos -- on all sides, it is said, the criminal landscape is expanding.

Modern organized crime has adopted many of the tools and techniques of
multinational business, while adding its own special powers of violence and
disregard for all rules.

"I have no problem in saying we are losing ground," said RCMP Deputy
Commissioner Giuliano Zaccardelli. "When we look at the resources we have to
fight organized crime, there is clearly a serious gap, and that gap is growing."

And while organized crime is a problem in most Western countries, for
several reasons Canada is perhaps a special case.

One is geography -- proximity to the United States, which offers vast market
opportunities for organized crime of all shades.

Another factor is Canada's stability and efficient economic infrastructure,
allowing funds and communications to flow easily.

And a third is the fact that Canada is a nation of immigrants -- few cities
on the planet are changing as quickly as Toronto, home to more than 140
ethnic groups. The law-abiding majority of newcomers are accompanied by
entrepreneurs with other ambitions.

Among today's key groups are Asian gangs, Eastern Europeans (particularly
Russians) and Mafiosi from Italy and Sicily. And alliances between them
flourish. Canada's outlaw motorcycle gangs, for instance, the most visible
players in the field, commonly act as enforcers and drug distributors for
other groups.

"Crime has no borders," said Captain Andrea Carpani, who heads the
Carabinieri's special anti-Mafia section in Perugia, north of Rome. "Only
the police have borders, and the biggest difficulty for us is the different
laws in each country."

Capt. Carpani, visiting Canada to help co-ordinate Wednesday's operation,
offered an illustration.

When two Colombian gangsters met an Italian undercover cop in Milan's
central square, handing over two suitcases stuffed with $1-million (U.S.) in
$100 bills, that was the break police needed. Project Casablanca, one of
many operations involving the Cuntrera-Caruana crime family, was about to
achieve results.

That cash had been tracked all the way from its Colombian source, arriving
in Europe by ship. Italian police fed it into a bank, then sat back and
watched as it was whisked around the world, stopping briefly several times
before returning to Colombia.

Here, finally, was proof that the drug-smuggling Colombians were using their
Mafia allies to wash their loot, with the Cuntrera-Caruanas acting as middlemen.

"The route was always similar -- from Italy to Switzerland, from Switzerland
to Miami or to France and then South America," said Capt. Carpani.

"It would take one, two days, no more. Unbelievable. But for us to trace
that would normally take three months, four months, a year."

Multinational crime presents a host of policing difficulties: language and
cultural barriers; computer technology that can shunt laundered money around
the world with the click of a mouse; slow and sometimes unhelpful foreign
police agencies; squabbles over jurisdiction and seized assets.

If crime knows no frontiers, neither does modern technology. Satellite
phones, computer encryption and the cyberspace revolution have helped make
covert communication and the transfer of funds more secure than ever before.

Add to that a new, looming concern: fraud in the trading of securities
promoted and distributed on the Internet.

Few economic sectors are untouched.

Just recently, the Toronto Stock Exchange suspended trading in the stock of
YBM-Magnex, an Ontario-based corporation that manufactures bicycles and
magnets, after the U.S. Federal Bureau of Investigation charged that
one-third of its shareholders had alleged links with the Russian mob.

But commercial crime has proved exceptionally hard to investigate. Gene
McLean of the Canadian Bankers Association said there has been an
exponential increase in credit-card fraud and counterfeiting, and that
organized criminals have fine-tuned the processes involved, yielding high
returns and low risks of capture.

"These are not some local yokels who happened to get hold of your credit
card. These are very organized people. They have lawyers, they have
accountants. They have the money to buy whatever they need."

Connecting that money to the people who control it can be almost impossible.

Mr. Caruana once had $21-million pass through his bank account in a single
year. Yet he claimed he made $400 a week washing cars and had assets of just
$250.

Next week, Statistics Canada will release 1997 crime figures expected to
show that most categories of crime have either remained static or are
declining. That trend has been under way for several years. In particular,
violent crime will be seen to have dipped once again in most urban areas --
with the conspicuous exception of Toronto.

Those reassuring numbers, however, reflect only reported crime. And while
organized crime is by every estimate surging, it goes largely unseen.

"People romanticize it, but in real life there is very little romance to
it," said Mario Possamai, a forensic investigator who specializes in
white-collar crime. "The basic approach that you have to take is that
organized crime is a business. The people in it are there to make a profit."

In Canada, one of the biggest growth areas has been vehicle theft,
transformed into a highly profitable, multinational operation with a
distribution system that would rival that of many large, legitimate industries.

Since the late 1980s, the number of vehicles stolen in Canada has increased
by more than 400 per cent, from about 37,000 a year to almost 180,000.

Ten years ago, about 95 per cent of those stolen vehicles were recovered.
Today, the figure is about 70 per cent.

"It has become a huge, huge market," said Ron Giblin, vice-president of the
Insurance Crime Prevention Bureau. "It's now a business."

Accompanying organized crime is a dramatic rise in money-laundering, of
which Canada sees more than its share.

Not all the news is bad.

Within Canada, police say co-operation between different agencies has rarely
been better. There is also praise for Solicitor-General Andy Scott's stated
intention to toughen the laws regarding suspicious bank deposits and
currency transfers. (Current legislation requires only that deposits of
$10,000 or more be reported.)

As well, the 1989 proceeds-of-crime bill, which forces convicted criminals
to forfeit ill-gotten assets, has been judged successful.

"It's had a fantastic impact," said Detective-Sergeant John Corcoran of the
Ontario Provincial Police proceeds-of-crime unit. "That's the way we hurt
these people."

Police unanimously say that combatting the scourge calls for more money than
ever before. Yet they face cutbacks -- the RCMP's current budget, for
example, is $174-million less than it was in 1994.

In the case of the Cuntrera-Caruana investigation, limited resources almost
caused the operation to end.

"There have been many expensive investigations that were aborted; this time
we stuck with it, and we got what we wanted," Insp. Soave said.

"The police know what they're doing, but they're overtaxed," said Mr. McLean
of the CBA. "They simply don't have the resources to take on too many of
these investigations."

But for the criminals, Mr. McLean said, "the world is their apple."

WHO'S WHO IN THE WORLD OF CRIME

In all, 18 distinct but frequently connected major organized-crime groupings
are known to Canadian police, with thousands of active members. The
principal players are drawn from:

Motorcycle gangs. Of the 38 documented outlaw gangs, the Hells Angels are
regarded as the most powerful and best-organized, with a foothold in every
province except Ontario. In Quebec, a battle between the Angels and rival
Rock Machine for control of the drug trade has left at least 40 people dead
in the past three years. Bikers also wield much influence in the ports of
Vancouver and Halifax.

Asian criminals. The chief focus is white-collar crime -- credit-card fraud,
telecommunications theft, money-laundering and pirating of computer
software. Organized shoplifting, car theft and distribution of heroin are
other mainstays. Most prominent are the Big Circle Boys, based in Toronto
and Vancouver.

Eastern European-based gangs. Now operating in most parts of the country,
what is often termed the Russian mafia specializes in smuggling stolen
goods, from luxury cars to computer equipment. Links to counterparts in the
United States and former Soviet Union are strong.

Italian-based groups. Chiefly of concern in Ontario, Quebec, British
Columbia and Manitoba, these long-entrenched organizations comprise the
Sicilian Mafia, the 'Ndrangheta of Calabria and the U.S.-based La Cosa
Nostra, with the Sicilian Mafia regarded as the strongest. Drugs and
money-laundering are the principal source of funds. Secondary activities
include murder, extortion, smuggling and loansharking.

Aboriginal street gangs. Relatively new players, aboriginal gangs in the
Prairies are growing in number and have forged alliances with other
organized-crime groups. The most powerful is thought to be the Manitoba
Warriors, involved in drug-trafficking and prostitution. Elsewhere,
smuggling of liquor, tobacco and illegal aliens is the chief activity.

Others. These include Colombian-based cocaine traffickers and Jamaican-based
posses, also heavily involved in the drug trade. Source: Criminal
Intelligence Service of Canada

Copyright (c) 1998, The Globe and Mail Company

Checked-by: Melodi Cornett