HomeNewsAnalysisSix Ways Coronavirus is Impacting Organized Crime in the Americas
ANALYSIS

Six Ways Coronavirus is Impacting Organized Crime in the Americas

COCAINE / 4 MAY 2020 BY PARKER ASMANN, CHRIS DALBY AND SETH ROBBINS EN

Criminal groups across Latin America have been forced to dig deep by the coronavirus pandemic and subsequent lockdown. Moving drugs and contraband, shaking down extortion victims and getting migrants across borders have all become far more difficult amid increased scrutiny and the lack of human activity.

On the other hand, the global shutdown has allowed enterprising criminal minds to find opportunities: cybercrime, false contracts, the theft of medical equipment and more.

SEE ALSO: Coverage of Coronavirus and Organized Crime

Below, InSight Crime explores the principal ways in which the coronavirus has shaken up organized crime dynamics in the region.

1. More Social Capital for Criminals

Criminals were a de facto state prior to the virus. In many places, they have now become the state.

In El Salvador, gangs like the MS13 and Barrio 18 have watched over specific neighborhoods, telling people to stay indoors, although reports have emerged of favored traders and shops being allowed to remain open despite the curfew.

In Venezuela, pro-government armed groups known as “colectivos” were the ones to announce the very first lockdown measures in certain areas, even before the government or healthcare services.

And as the weeks passed, some of these groups have taken on a broader social role. In Mexico, a range of criminal groups from the Jalisco Cartel New Generation (Cartel de Jalisco Nueva Generación -- CJNG) to Los Viagras have distributed packages of food and essential items. The lockdown affords them a chance to consolidate their control, ingratiate themselves with residents and cultivate support.

A food kit given out by the Jalisco Cartel in Mexico/Photo: Contralinea

2. New Black Market for Medicine and Equipment

Countries like Mexico and Guatemala have long contended with an active black market for medicine, facilitated by corruption in their healthcare and social security systems. But the coronavirus pandemic has seen the rest of Latin America threaten to catch up due to a boom in the theft of medical supplies, including masks, hand sanitizer and even coronavirus detection kits.

The most notable case came when 15,000 coronavirus testing kits and over two million personal protective items were stolen from São Paulo’s Guarulhos Airport in early April, although these were later recovered. In Honduras, boxes of N95 masks have been arriving at hospitals with dozens missing as the country continues to suffer from a severe shortage.

SEE ALSO: Theft of Critical Medical Equipment Surges in Latin America

And Colombia has seen repeated seizures of illicit medicine, especially paracetamol, considered the painkiller of choice to relieve symptoms of coronavirus.

The pandemic has exposed a severe lack of supply chain control in the medical field, which allows for products to be easily stolen. As cases of coronavirus continue to rise, this criminal economy may become more permanent.

3. More Graft

Powerful political actors and government officials across the region have leveraged their positions to corrupt everything from national health systems to the processes used to dole out public works contracts and select attorney generals. The coronavirus has provided just the latest opportunity for corruption.

In Colombia, the Comptroller’s Office has documented some “$20.6 million in apparent overcharges in some 8,100 contracts signed by mayors and governors” involving food and medical supplies to help citizens of the Andean nation handle the outbreak, according to a Reuters report.

Health systems have been ripe for corruption all across Latin America in years past, and early evidence suggests that corrupt officials may also be eyeing the current pandemic as yet another way to line their pockets at the expense of citizens.

The Attorney General’s Office in Honduras has launched an investigation into potential irregularities regarding the country’s Permanent Contingency Commission’s (Comisión Permanente de Contingencias -- COPECO) handing of purchasing resources and awarding contracts in response to the coronavirus outbreak. The National Anti-Corruption Council (Consejo Nacional Anticorrupción -- CNA) has also warned of corruption involving government purchases of overpriced medical supplies.

4. More Cybercrime

Criminal hackers are taking advantage of the rapid rise in online activity from individuals, companies and governments.

A malicious app, which claimed to provide interactive maps of the virus’ spread, has already spread widely in Costa Rica, hijacking users’ devices to demand they pay ransom in the cryptocurrency Bitcoin. Email phishing schemes promising government stimulus money and phony coronavirus tests have also proliferated.

Latin America is already home to a significant portion of the world’s malware attacks, where experts say governments, individuals and financial institutions are all vulnerable. Hackers in Mexico managed to successfully infiltrate the country’s state-run oil company in 2019 and the Ministry of Economy in 2020. Luxury hotel chains in Brazil were targeted in 2019 by phishing schemes that allowed criminals to gain access to databases with customer credit card information. Colombia saw 49 billion cyberattack attempts last year, with the banking industry being the most frequently targeted.

Brazil, Mexico and Colombia are the top three countries in Latin America for malware attacks, according to the Russia-based cybersecurity firm Kaspersky.

Critical infrastructure is also at risk with four out of five Latin American countries lacking a cybersecurity strategy infrastructure protection plan, according to a 2016 report by the Inter-American Development Bank.

In addition, organized crime groups are increasingly laundering money through cryptocurrency and looking to hackers for help, according to a report by the global cyberthreats firm IntSights Cyber Intelligence. With the coronavirus pandemic disrupting drug supply chains, the report’s author, Charity Wright, told InSight Crime that these same groups may turn to cybercrime to “diversify their financial flows.”

5. Less Human Smuggling

As adept as human smugglers may be at moving migrants, even they must have been dismayed at the layers of extra security seen along the borders since the pandemic began.

US President Donald Trump shut down the entire border with Mexico to migrants, and hundreds of extra troops were deployed to patrol it. The Northern Triangle countries of El Salvador, Guatemala and Honduras quickly followed suit. Even Costa Rica, long one of the region’s more welcoming countries to migrants, has deployed various security force units to turn back anyone seeking to enter from Nicaragua.

SEE ALSOWhat Does Coronavirus Mean for Criminal Governance in Latin America?

The prices charged by “coyotes,” as human smugglers are known, had already been increasing due to hard-line policies in Central America and the United States. The coronavirus pandemic has only tightened the screws, both on migrants and on the families they leave behind.

And even once quarantine measures abate, measures to control and restrict migration are likely to continue.

Nicaraguan police deployed at a border crossing with Costa Rica/Photo EFE

6. Less Illicit Drugs, Higher Prices

With borders shut to most transit and authorities widely checking vehicles, drug traffickers are struggling to move their product during the quarantine. This has led to a precipitous drop in supply for traffickers across the region.

Street prices for marijuana have doubled in Argentina, according to a local dealer in Buenos Aires who spoke with Vice about a shipment from Colombia that was stranded in transit. Germán de los Santos, a journalist and investigator, told InSight Crime that marijuana is particularly expensive now because its volume makes it “harder to transport” and conceal. Poorer neighborhoods have also seen a return of solvent abuse, he said.

In Mexico, the Sinaloa Cartel reportedly told dealers to sell methamphetamine at five times the previous price, Vice reported. Designer drugs like MDMA have seen a massive drop in sales due to the shuttering of nightclubs, according to the Vice report.

Colombia has seen “basuco” -- a crude, adulterated form of cocaine paste -- increase four times its usual per gram street price, according to El Espectador.

Local drug gangs must also contend with transport restrictions and increased patrols to enforce quarantines. Bike and motorcycle messengers, who are considered essential workers, have been caught carrying illicit substances, including some sporting bags from popular delivery app services. Authorities have also found so-called "narco-ambulances" circulating, vehicles that have been used in the past to move drugs.

This impact has also been felt in the United States. In New York City, the street price of marijuana has risen 55 percent since March, with cocaine and heroin now 12 and seven percent more expensive, respectively, according to the US Drug Enforcement Administration (DEA).

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