THE NATURE OF DRUG-TRAFFICKING NETWORKS

There are many reasons why the war on drugs has failed. One of the most
important has been the inability of law enforcement efforts and military
interdiction to degrade, disrupt, or destroy the networks trafficking drugs
into the United States and Western Europe. This inability stems from a
failure to understand fully the struc-ture of these networks and their
capacity to counter or circumvent law enforcement and military interdiction.

The predominant conception - especially in the case of cocaine trafficking
- - has been of large, hierarchical, vertically integrated organizations
forming cartels and dominating the market. Government strategy has targeted
the leaders of these organizations, the so-called kingpins. But although
the leaderships of both the Medellin and Cali cartels have been
"decapitated," it has had only a limited impact on the flow of drugs to the
United States. Critics of supply reduction efforts claim that this is not
sur-prising: interfering directly or indirectly with the supply of drugs
serves merely to raise prices, which in turn makes the market more
attractive and encourages new suppliers.

The argument here is not intended to challenge the idea that the market
contains self-adjusting mechanisms of this kind. It does suggest that this
does not tell the whole story A large part of the supply reduction failure
can be understood in terms of the organizational superiority of
drug-trafficking supply networks over the more traditional bureaucratic
organizations that dominate interdiction and law enforcement efforts.

In recent years many business analysts and management consultants have
emphasized that networks are far superior to traditional hierarchies in
terms of organizational effectiveness, especially when it comes to
innovation and teamwork. But what licit business appears to be discovering
is something that has long been known to criminal organizations, which have
been at the forefront in embracing network structures. This is hardly
surprising since network structures are resistant to disruption and have a
degree of resilience that other forms of organization lack. By using
networks, transnational criminal enterprises and drug-trafficking
organizations also enjoy enormous flexibility and are able to respond
rapidly to new strategies or innovative techniques developed by law
enforcement.

Ironically this reliance on networks is something many observers of
criminal organizations have generally ignored. There is a tendency in law
enforcement circles and among some academic analysts to treat centralized
hierarchies as synonymous with organized crime and to treat networks as
disorga-nized crime. This is a mistake. A network is a highly sophisticated
organizational form. David Ronfeldt of the RAND Corporation has argued that
society has gone through a long evolutionary process that has been
dominated successively by tribes, hierarchies, and markets. In each case
the new form of organization did not replace the previous one but surpassed
it in effectiveness and efficiency Ronfeldt argues that society is now at a
fourth stage in which networks are emerging as the predominant
organizational form, a form that has significant advantages over more
traditional bureaucratic hierarchies.[1]

If this is the case, law enforcement and military agencies engaged in
supply reduction need to recognize network characteristics and modify their
strategy accordingly. While such an adjustment would not guarantee total
success in the war on drugs, it could help level the playing field.

WHAT IS A NETWORK? A network can be understood as a series of connected
nodes. The nodes can be individuals, organizations, firms, or even
computers, but the critical element is that there are significant linkages
among them. Networks can vary in size, shape, membership, cohesion, and
purpose. They can be large or all, local or global, cohesive or diffuse,
centrally directed or highly decentralized, purposeful or directionless. A
network can be narrowly focused one goal or broadly oriented toward many
goals, and its membership can be exclusive or encompassing. Networks are at
once pervasive and intangible, everywhere and nowhere. More prosaically,
they facilitate flows of information, knowledge, and communication as well
as more tangible commodities. They operate in licit as well as illicit
sectors of the economy and society. This enormous variability makes the
network concept an elusive one; at a practical level, it also makes
networks difficult combat.

The purposes of a network can vary. Networks provide a means to achieve a
variety of goals. In effect, they are neutral regarding the nature of the
goals and can be used for positive or negative ends. This discussion, of
course, is about networks that are highly functional in their own terms yet
are inimical to society at large. In the case of drug-trafficking networks
there is a common purpose, which is to ensure that drugs move from the
source countries through a variety of transshipment points to the customers
(with minimum disruption and, loss from law enforcement activity) and that
profits accrue, in varying degrees, to members of the network. The networks
provide essential links between suppliers and customers, and are critical
to the effective functioning of the market.

Still there are many gaps in our understanding of drug-trafficking
networks. The pattern of authority and direction in these networks is not
always evident, the balance between competing and cooperating networks is
not readily discernible, and the nature of information flows through them
is often elusive. Nevertheless, it is clear that networks have several
characteristics that make it difficult for law enforcement to combat them
effectively.

CORE, PERIPHERY, AND GLOBALIZATION A drug-trafficking network of any
substantial size will have both a core and a periphery. The core is likely
to consist of dense network connections among a group of individuals or
small organizations that provide the steering mechanism and sense of
direction for the entire network. The core members will also have bonding
mechanisms that afford a high degree of trust and cohesion in their
relationships. Bonding can be achieved through a variety of means - common
ethnicity tribal connections, family or lineage, common experience in youth
gangs or prison - but is critical to the network core. The periphery is
likely to be less dense, with somewhat looser relationships in which the
bonding mechanisms are not as strong. Peripheries of networks exhibit what
in the business literature has been termed the strength of weak
relationships, which allows the network to operate far more extensively and
with greater impact.[2] The links in the periph-ery of drug-trafficking
networks also seem to correspond with what Francis Ianni has called
criminal relationships: "links based upon a common core of activity in
crime that keep people working together once they have joined in a
network."[3]

Two-tiered networks of this kind with both core and periphery have
formidable internal defense mechanisms. While it is possible for law
enforcement to infiltrate the periphery of the network, getting to the core
is much more difficult partly because entry is dependent on a high level of
trust that is based on bonding rather than functional utility. Moreover,
there will usually be several nodes in the network that act as built-in
insulators between core and periphery; these distance the core leaders from
operations and impede law enforcement efforts to strike at the center of
gravity as opposed to nibbling around the edges. The concomitant of this is
that the periphery is where the risks from law enforcement are greatest.
Ultimately this is not too serious a problem; if parts of the periphery are
seriously infiltrated or compromised, the core can simply discard them and
recruit new members for the outer reaches of the network.

Networks display a remarkable capacity to flow around physical barriers and
across legal or geographical boundaries. They in effect transcend borders,
and are the perfect means of conducting business in a globalizing world.
While not all net-work organizations are transnational in scope or
ambition, there is a natural congruence between transnational or
cross-border activities and network structures, irrespective of whether the
networks operate exclusively in the legitimate sector or in supplying
illicit goods and services. In this connection, the capacity of individual
criminals or groups in one country to extend their network through linkages
with their counterparts in other countries gives organized crime and drug
trafficking a transnational character that makes it much more difficult to
combat. Criminal networks have become borderless while law enforcement
agencies are still constrained by national borders.

Their transnational character also places criminal networks in an excellent
position to exploit the global financial or global trade system. Global
trade has become so extensive that it is easy for criminal networks to
embed and conceal illicit products among licit goods. Indeed,
containerization is becoming an increasingly important mode of moving drugs
from suppliers to consumers.

Similarly the capacity of drug-trafficking networks to move the proceeds of
their activities through multiple jurisdictions complicates law
enforcement's efforts to follow the money trail with a high degree of
confidence or in a timely manner. The synergy between social networks and
technological or information networks is huge. The ability of transnational
drug-trafficking networks to exploit globalization means that in the
twenty-first century national and even regional law enforcement efforts
will become even more difficult.

Another important feature of networks is that they cross easily from the
illicit to the licit sector. Drug-traffickers can enlarge their networks to
include lawyers, doctors, and bankers to help them conceal and invest their
profits. Criminal networks can readily extend their reach, co-opting
individuals and organizations in ways that facilitate, enhance, or protect
their activities. Co-option can be achieved through bribery, coercion, and
intimidation.

These links are dynamic rather than static and increase in importance and
value over time. A network link between a low-level criminal and a junior
official will become much more significant as the criminal becomes more
powerful and the official becomes more senior. In these circumstances, the
exchange relationship becomes much more substantial in terms of the favors
done by the official and the payoffs provided by the criminal. The official
is not part of the criminal enterprise per se, but is a vital node in the
criminal network. As such, he or she provides important services to the
network, including critical and timely intelligence about government and
law enforcement activities. If enough people in important government
positions are corrupted and co-opted in this manner, the network can almost
certainly count on a high degree of protection against vigorous enforcement
efforts.

The link between organized crime and corruption and the importance of
corruption networks in facilitating criminal activities such as drug
trafficking have been given scant attention. Yet in countries such as
Mexico, Colombia, Nigeria, and Russia the linkages between criminals and
officials have become one of the most serious impediments to achieving
democratic governance and a free market economy Collusive links also exist
at lower levels, with law enforcement and customs officials accept-ing or
imposing bribes in return for free passage of drugs. A good example of this
is the Turkey-Iraq border where, according to one report, "drug trafficking
is always taxed, but seldom checked and never stopped. "[4] Corruption
networks, at the political and operational levels, are as insidious as they
are pervasive and make both drug trafficking and organized crime
increasingly difficult to counter.

INTELLIGENCE AND COUNTERINTELLIGENCE Another important characteristic of
networks is their efficiency and effectiveness in procuring information. In
the case of drug-trafficking networks, the need is for counterintelligence
that allows the networks to anticipate and negate law enforcement
initiatives. The Cali drug-trafficking organization was especially adept at
this and used an extensive network of taxi drivers and street vendors to
gain intelligence about law enforcement activities in Cali. Extension of
the network into government and law enforcement agencies is also important
in this context, resulting in the corruption described earlier. While this
is a phenomenon that occurs pri-marily in supplier or transshipment
countries - and has become a predominant feature of political life Colombia
and Mexico - criminal network infiltration of law enforcement also occurs
in the United Sates. There have been numerous instances of street gang
members joining the police, thereby obtaining ready access to early warning
information that provides an opportunity for defensive actions against law
enforcement. Members of the Gangster Disciples, the Latin Kings, and the
Latin Lovers are known to have penetrated the Chicago police force, thereby
augmenting their understanding of police methods and their capacity to
detect undercover agents.

Accompanying the efficient acquisition and dissemination of certain kinds
of information is the capacity to contain and protect other types of
information. Drug-trafficking networks often operate in cellular fashion in
which information is compartmentalized or shared only on a need-to-know
basis. As a result, arrests tend to be limited to those on the periphery,
who do not yield usable connections to those in the core. Moreover,
drug-trafficking networks have tried to increase the reluctance of their
members to pass information to law enforcement authorities by their
readiness to harm the families of informants and by their willingness to
support the families of those who remain loyal and resist blandishments
such as offers of leniency in return for information.

In addition to this, many networks have two characteristics that make them
hard to penetrate: ethicity and language. Moreover, many of the net-works
use languages or dialects unfamiliar to law enforcement personnel in the
host countries. Con-sequently electronic surveillance efforts directed
against, for example, Chinese or Nigerian drug-trafficking networks are
either neutralized or rendered much more difficult. Furthermore, ethnic
drug-trafficking networks do not exist in a vacuum but instead operate in
and from ethnic communities that provide concealment and protection as well
as an important source of new recruits. Some net-works, such as Chinese
drug-trafficking groups, are based largely on ethnicity They are global in
scope and operate according to the principle of "guanxi" (notions of
reciprocal obligation), which can span generations and continents and
provides a basis for trust and cooperation. Such networks are especially
difficult for law enforcement to infiltrate. In short, drug-trafficking
networks have a significant capac-ity to protect their information and to
defend themselves against law enforcement initiatives.

Networks are also able to expand or contract as circumstances demand. Their
capacity for rapid reconfiguration enables them to respond quickly to law
enforcement and interdiction efforts by relocating their activities.
Networks have some fixed assets, but are able to move their operations in
ways that exploit the paths of least resistance. Most Colombian cocaine was
initially transported to the United States through the Caribbean and
Florida. When the interdiction effort in this region was increased in the
late 1980s and early 1990s, many of the trafficking networks moved to
Mexico and the southwestern border of the United States. More recently as
law enforcement and military interdic-tion efforts have increased on that
border, there has been a return to Florida.

Similarly on a global level, during the 1990s much greater use has been
made of African states as transshipment points for drugs destined for the
United States and Europe. According to a 1997 study by the Observatoire
Geopolitique des Drogues (Geopolitical Drug Watch) in Paris, almost 30
percent of heroin shipments seized in Europe or the United States passed
through Africa, which is an easy place for traffickers to do business. As
the group has noted, "There are plenty of under-policed air or sea
ports-like Mombasa (Kenya), Dar es Salaam (Tanzania) and Maputo
(Mozambique) - and civil wars in countries like Angola, Somalia, and
Liberia mean porous borders - where drugs can be shipped or traded with
impunity."

Closely related to this, networks can respond to law enforcement profiles
of network participants by recruiting new network members to act as
couriers. Nigerian drug traffickers in particular increasingly face the
profiling problem: because many Nigerians are known to be heavily involved
in the trafficking of cocaine and heroin, they are more likely to be
stopped at airports and other points of entry and searched by customs
inspectors. Nigerian traffickers have dealt with this partly by recruiting
network members who do not fit the profile and therefore tend to make more
successful couriers. This exten-sion of the network typically involves
recruitment of middle-aged white women, but in one case (in June 1996)
included a group of American sailors with the Sixth Fleet. In other cases,
Nigerian men have married Polish or Hungarian women and then sent them to
buy cocaine in South America. The cocaine is delivered to countries such as
the Netherlands and transferred to other women who travel to other
countries, such as Britain, where the cocaine is sold. Neither the Nigerian
connection nor the South American link is evident, and the network is
itself virtually invisible.

MANAGING RISK Networks are excellent organizations for managing risk and
limiting damage to the criminal enterprise. If the network is compromised
or degraded in some way it can alter its shape and still function. This is
achieved in part through compartmentalizing organizational activities,
disseminating knowledge on a need-to-know basis, and separating operators
and strategic managers. This makes it possible to maintain within a network
a series of safety devices that not only insulate the core but also limit
damage.

Networks are highly resilient, partly because of what might be termed loose
coupling. In his 1984 book "Normal Accidents," Charles Perrow distinguishes
between tightly coupled and loosely cou-pled systems. The most vulnerable
are tightly coupled systems where disturbances involve a chain reaction or,
at the very least, serious cascading effects. In contrast, "'loose coupling
gives time, resources, and alternative paths to cope with the disturbance
and limits its impact." Drug-trafficking networks, by their very nature,
involve loose coupling and can more effectively manage the risks they face.

Another crucial characteristic of networks is that they have built-in
redundancy that allows for recovery if part of the network is impaired.
Some of the literature on business networks has noted that a network, left
to its own devices, will tend to produce redundant contacts that are not
especially efficient. In the case of drug-trafficking networks, the
inefficiency associated with redundant contacts is negligible when compared
to the benefits. For networks, which almost invariably face the problems of
degradation and attack by law enforcement, redundancy is a virtue. It
provides a range of options to move the commodities to the market and to
repatriate profits, allowing the network to exploit the path of least
resistance. Even more important, it enables network members to take over
tasks and responsibilities from those who have been arrested or killed.
While there is specialization in drug-trafficking networks, roles are
rarely so specialized that substitutes cannot readily be found.
Consequently redundancy allows networks to mitigate the impact of
successful law enforcement actions. Because of this characteristic, the
network is the ideal form for maintaining organizational integrity in an
inhospitable environment.

THE VIRTUE OF DIVERSITY Networks can take various forms and their members
can exhibit enormous similarities or enormous differences. A
money-laundering network in New York that was not very sophisticated in its
operations but still succeeded in laundering over $70 million for Colombian
drug-traffickers included a taxi driver, an honorary consul-general for
Bulgaria, a New York City police officer, an assistant bank manager in
Citibank, two rabbis, and a firefighter. The network transferred
drug-trafficking proceeds to a bank in Zurich, where two employees
forwarded the funds to the Caribbean account of a major Colombian drug
trafficker.

While some networks consist of individuals, others, according to Aaron
Hollen, consist of both individuals and organizations, including some that
might be hierarchical in character. In this connection, there is an
important difference between the cocaine and heroin networks. The
cocaine-trafficking networks operating from Medellin and Cali in Colombia
had a considerable degree of vertical integration, with a relatively small
number of organizations controlling the flow of drugs from leaf to nose. In
the case of heroin, however, there are multiple supply sources such as
Southwest Asia (especially Afghanistan and Pakistan), Southeast Asia
(especially Burma), and Colombia which, during the 1990s, has diversified
into opium poppy cultivation and heroin processing. There are also multiple
sup-pliers, including Chinese networks, Nigerian drug-traffickers, Turkish
groups, various Italian mafia organizations, and the smaller Colombian
drug-trafficking organizations that have effectively superseded the
Medellin and Cali cartels. Much of the heroin trade, especially in and near
the source countries, occurs through network transactions in which brokers
appear to play a major role. Moreover, many of these brokers and middlemen
(particularly the Chinese) are extensively engaged in licit as well as
illicit business. These variations in network structure and membership make
the task of law enforcement even more formidable.

Another characteristic of networks is that they can easily forge links with
one another. A network does not lack an organizational identity, but it is
not overly preoccupied with organizational form. Consequently networks can
come together when it is convenient or beneficial without this being in any
way a threat to their identity or raison d'etre. Indeed, one of the most
important trends in drug trafficking and organized crime in recent years
has been the growing connections among different criminal enterprises.
Colombian-Sicilian networks, for example, were critical in developing the
cocaine market in Western Europe. They joined Colombian suppliers with the
Sicilian mafia, which had local knowledge, well-established heroin
distribution networks, extensive bribery and corruption net-works, and a
full-fledged capability to launder money.

In a similar vein, Italian and Russian criminals have forged their own
networks while Colombian and Russian criminals have been meeting in various
Caribbean islands including Aruba. The extension of influence through
networks of this kind provides new opportunities for criminals. One result
of the Colombian-Russian contacts has been increased amounts of cocaine
both imported to and transshipped through Russia. Colombian
money-laundering activities could also be extended into and through Russian
banks and companies. In this case, two powerful networks of criminal
enterprises seem to be allying for mutual advantage.

Not all connections among networks are reciprocal. Mexican drug-trafficking
families have used Hispanic street gangs in southern California for
retailing drugs and for contract killings. Indeed, the relationships
between criminal networks cover a spectrum from spot sales at the lowest
level to joint ventures and strategic alliances at the highest. In between
are a series of arrangements such as contracting out or franchising for
particular functions or roles. A recent development noted by the United
States Drug Enforcement Administration, for example, has been the
willingness of some Colombian groups to franchise smuggling and
transportation operations to Puerto Rican and Dominican groups, which then
transfer the drugs to Colombian wholesalers in the United States or retail
the drugs themselves. Extending their networks in this way allows the
Colombians to operate without going through Mexico and paying the Mexican
drug-trafficking organizations the large percentage of profits they demand.
Such an approach also minimizes the need for an extensive Colombian
presence in Puerto Rico. The critical point about networks is that they
facilitate cooperation of this kind among criminal enterprises just as they
do in the licit business world.

FIGHTING FIRE WITH FIRE Networks are a highly efficient and effective
organizational structure for drug traffickers. Network organizations are
fast, flexible, and forward looking. They put function over form and are
far less concerned with neat organizational charts and jurisdictional
niceties than with their overall effectiveness in achieving their goals. In
contrast, governments are composed of and rely on large, bureaucratic
hierarchies that operate according to standard operational procedures, are
bound by budgetary constraints, and are, for the most part, cum-bersome. If
governments are to make significant inroads against drug-trafficking
networks, they have to acknowledge and act on the fundamental point made by
John Arquilla and David Ronfeldt: it takes a network to defeat a
network.[5] Governments and law enforcement agencies have to think and act
much more in network terms; they need to develop the same kind of
flexibility to operate both nationally and transnationally through the
creation of informal transnational law enforcement networks based on trust
that is exhibited by drug-trafficking networks. Greater care also needs to
be given to devising strategies for more effective attacks on networks.
Such strategies need to identify both critical nodes (those where
redundancy is minimal) and critical connectuions - especially those to
government and the legitimate financial sector. They also need to attack
the network both externally through the removal or elimination of key nodes
and connections, and internally through such tactics as disinformation and
the creation of mistrust. While this approach does not guarantee success,
it does at least conform to the first precept of effective strategy, which
is to know your enemy and adjust your actions accordingly.

[1] See David Ronfeldt, Tribes, Institutions, Markets, Networks:A Framework
about Societal Evolution (Santa Monica, Calif.: RAND, 1996).

[2] Mark Granovetter, 'The Strength of Weak Ties," American Journal of
Sociology, Vol. 78 (1973). This idea is further developed in Ronald S.
Burt, Structural Holes: The Social Structure of Competition (Cambridge,
Mass.: Harvard Univer-sity Press, 1992).

[3] Francis J.Ianni, Black Mafia: Ethnic Succession in Organized Crime (New
York: Simon and Schuster, 1974), p.281.

[4]Observatoire Geopolitique des Drogues (Geopolitical Drug Watch), Annual
Report 1995-1996, September 1997 on the OGD home page (http://www.ogd.org).

[5] See John Arquilla and David Ronfeldt, eds., In Athena's Cam p:
Preparing for Conflict in the Information Age (Santa Monica, Calif.: RAND,
1997).

Checked-by: Mike Gogulski