Category Archives: corruption/Illegal markets

Killing Popcupines for their Bellies: endangered species

Porcupines  are been hunted for undigested plant material in their gut known as bezoars.


Varieties of porcupine bezoar

According to leading wildlife trafficking experts, the small, spiny rodents are at risk of becoming endangered across Southeast Asia.  Demand is predominantly driven by China, where some believe that bezoars, which accumulate in the digestive tract, have potent medicinal properties, including the ability to cure diabetes, dengue fever, and cancer. Bezoars are sold either raw or in powdered form and may be processed into capsules. A few ounces of the substance can command hundreds, even thousands, of dollars. Most sought after is the dark red “blood” bezoar, believed to be the most potent of the several varieties. Prices for bezoars have “increased exponentially during the past few years, following recent claims of their cancer-curing properties,” according to a 2015 report by the wildlife trade monitoring organization Traffic.

The Philippine porcupine, the Asiatic brush-tailed porcupine, and the Malayan porcupine, which live throughout Southeast Asia, are all flagged as threatened and declining in number by the International Union for Conservation of Nature, the body that sets the conservation status of wildlife species. None has yet been listed as endangered, which would bolster legal protection and international awareness.

Excerpts from Porcupines are being poached for their stomach content, National Geographic, Mar. 22, 2019

5,000 Eyes in the Sky: environmental monitoring

The most advanced satellite to ever launch from Africa will soon be patrolling South Africa’s coastal waters to crack down on oil spills and illegal dumping.  Data from another satellite, this one collecting images from the Texas portion of a sprawling oil and gas region known as the Permian Basin, recently delivered shocking news: Operators there are burning off nearly twice as much natural gas as they’ve been reporting to state officials.

With some 5,000 satellites now orbiting our planet on any given day…. They will help create a constantly innovating industry that will revolutionize environmental monitoring of our planet and hold polluters accountable…

A recent study by Environmental Defense Fund focused on natural gas flares from the wells in the Permian Basin, located in Western Texas and southeastern New Mexico. Our analysis proved that the region’s pollution problem was much larger than companies had revealed.  A second study about offshore gas flaring in the Gulf of Mexico, published by a group of scientists in the Geophysical Research Letters, showed that operators there burn off a whopping 40% of the natural gas they produce.

Soon a new satellite will be launching that is specifically designed not just to locate, but accurately measure methane emissions from human-made sources, starting with the global oil and gas industry.  MethaneSAT, a new EDF affiliate unveiled in 2018, will launch a future where sensors in space will find and measure pollution that today goes undetected. This compact orbital platform will map and quantify methane emissions from oil and gas operations almost anywhere on the planet at least weekly.

Excerpts from Mark Brownstein, These pollution-spotting satellites are just a taste of what’s to come, EDF, Apr. 4, 2019

A Swamp of Oil Pollution: Ogoniland

Status of Cleaning up Oil Pollution in Ogoniland, Nigeria:

According to the Civil Society Legislative Advocacy Centre (CISLAC), the clean-up of Ogoniland is bugged with identity crisis, procedures, processes and overheads. Perception of corruption, lack of transparency and accountability, complex decision making, internal crisis of choice between Ogoni and the Niger Delta….The United Nations Environment Programme (UNEP) released its Environmental Assessment of Ogoniland in August 2011 after series of protests of oil spillage in the community that culminated to the death of Ken Sarowiwa and eight others.  The report  made recommendations to the government, the oil and gas industry and communities to begin a comprehensive cleanup of Ogoniland, restore polluted environments and put an end to all forms of ongoing oil contamination in the region…

Pollution of soil by petroleum hydrocarbons in Ogoniland is extensive in land areas, sediments and swampland.  In 49 cases, UNEP observed hydrocarbons in soil at depths of at least 5 metres. At 41 sites, the hydrocarbon pollution has reached the groundwater at levels in excess of the Nigerian standards permitted by National Laws..

Excerpts from Ogoni: Cleanup Exercise by Authorities Questioned by Civil Society Groups, UNPO, Mar. 12, 2019

100 Ways to Finance Criminal Cartels Logging Forests

The report – Green Carbon, Black Trade (2012) – by UNEP and INTERPOL focuses on illegal logging and its impacts on the lives and livelihoods of often some of the poorest people in the world set aside the environmental damage. It underlines how criminals are combining old fashioned methods such as bribes with high tech methods such as computer hacking of government web sites to obtain transportation and other permits. The report spotlights the increasingly sophisticated tactics being deployed to launder illegal logs through a web of palm oil plantations, road networks and saw mills. Indeed it clearly spells out that illegal logging is not on the decline, rather it is becoming more advanced as cartels become better organized including shifting their illegal activities in order to avoid national or local police efforts. By some estimates, 15 per cent to 30 per cent of the volume of wood traded globally has been obtained illegally…

The much heralded decline of illegal logging in the mid- 2000s in some tropical regions was widely attributed to a short-term law enforcement effort. However, long-term trends in illegal logging and trade have shown that this was temporary, and illegal logging continues. More importantly, an apparent decline in illegal logging is due to more advanced laundering operations masking criminal activities, and notnecessarily due to an overall decline in illegal logging. In many cases a tripling in the volumes of timber “originating” from plantations in the five years following the law enforcement crack-down on illegal logging has come partly from cover operations by criminals to legalize and launder illegal logging operations….

Much of the laundering of illegal timber is only possible due to large flows of funding from investors based in Asia, the EU and the US, including investments through pension funds. As funds are made available to establish plantations operations to launder illegal timber and obtain permits illegally or pass bribes, investments, collusive corruption and tax fraud combined with low risk and high demand, make it a highly profitable illegal business, with revenues up to 5–10 fold higher than legal practices for all parties involved. This also undermines subsidized alternative livelihood incentives available in several countries.

[It is important to discourage] the use of timber from these regions and introducing a rating og companies based on the likelihood of their involvement in illegal practices to discourage investors and stock markets from funding them.

Excerpts from Nellemann, C., INTERPOL Environmental Crime Programme (eds). 2012.Green Carbon, Black Trade Illegal Logging, Tax Fraud and Laundering in the Worlds Tropical Forests. A Rapid Response Assessment United Nations Environment Programme

How to Kill One Million Fish: Murray-Darling

But it took a viral video posted on 8 January 2019 to drive home the ecological catastrophe that was unfolding in the Murray-Darling river system in Australia. In the footage, Rob McBride and Dick Arnold, identified as local residents, stand knee-deep among floating fish carcasses in the Darling River, near the town of Menindee. They scoff at authorities’ claims that the fish die-off is a result of the drought. Holding up an enormous, dead Murray cod, a freshwater predator he says is 100 years old, McBride says: “This has nothing to do with drought, this is a manmade disaster.” Arnold, sputtering with rage, adds: “You have to be bloody disgusted with yourselves, you politicians and cotton growers.”

Scientists say McBride probably overestimated the age of the fish. But they agree that the massive die-off was not the result of drought. “It’s about taking too much water upstream [to irrigate farms] so there is not enough for downstream users and the fish,” says Quentin Grafton, an economist specializing in water issues at Australian National University (ANU) in Canberra. The Australia Institute, a Canberra-based think tank, blamed “policy failure and mismanagement” in a 19 January 2019 report, but called drought a catalyst.

Excessive water use has left river flows too low to flush nutrients from farm runoff through the system, leading to large algal blooms, researchers say. A cold snap then killed the blooms, and bacteria feeding on the dead algae sucked oxygen out of the water,   This wasn’t supposed to happen. In 2012, the national government adopted the Murray-Darling Basin Plan, touted as a “historic” deal to ensure that enough water remained in the rivers to keep the ecosystem healthy even after farmers and households took their share.

In 2008, the federal government created the Murray-Darling Basin Authority to wrestle with the problem. In 2010, a study commissioned by the authority concluded that farmers and consumers would have to cut their use of river water by at least 3000 but preferably by 7600 gigaliters annually to ensure the health of the ecosystem. Farmers, who saw their livelihoods threatened, tossed the report into bonfires.  The final plan, adopted as national law in 2012, called for returning just 2750 gigaliters to the rivers, in part by buying water rights back from users. “It was a political compromise that has never been scientifically reviewed,” Williams says, adding that “climate change was never considered in the plan, which was a dreadful oversight.”..

Grafton says there are also suspicions of widespread water theft; up to 75% of the water taken by irrigators in the northern part of the system is not metered. Farmers are also now recapturing the runoff from irrigated fields that used to flow back into streams, and are increasing their use of ground water, leaving even less water in the system, says Mike Young, an environmental policy specialist at the University of Adelaide in Australia.

In February 2018, such issues prompted a group of 12 academics, including scientists and policy experts, to issue the Murray-Darling Declaration. It called for independent economic and scientific audits of completed and planned water recovery schemes to determine their effects on stream flows. The group, which included Williams and Grafton, also urged the creation of an independent, expert body to provide advice on basin water management. Young, who wasn’t on the declaration, wants to go further and give that body the power to manage the basin’s water, the way central banks manage a country’s money supply, using stream levels to determine weekly irrigation allocations and to set minimum flow levels for every river.

Excerpts from Dennis Normile, Massive fish die-off sparks outcry in Australia, Science, Jan. 22, 2019.

Shut-out, Cut-off and Suicidal: Aliens v. America

The United States leads the world in punishing corruption, money-laundering and sanctions violations. In the past decade it has increasingly punished foreign firms for misconduct that happens outside America. Scores of banks have paid tens of billions of dollars in fines. In the past 12 months several multinationals, including Glencore and ZTE, have been put through the legal wringer. The diplomatic row over Huawei, a Chinese telecoms-equipment firm, centres on the legitimacy of America’s extraterritorial reach.

America has taken it upon itself to become the business world’s policeman, judge and jury. It can do this because of its privileged role in the world economy. Companies that refuse to yield to its global jurisdiction can find themselves shut out of its giant domestic market, or cut off from using the dollar payments system and by extension from using mainstream banks. For most big companies that would be suicidal.

But as the full extent of extraterritorial legal activity has become clearer, so have three glaring problems.  First, the process is disturbingly improvised and opaque. Cases rarely go to court and, when they are settled instead, executives are hit with gagging orders. Facing little scrutiny, prosecutors have applied ever more expansive interpretations of what counts as the sort of link to America that makes an alleged crime punishable there; indirect contact with foreign banks with branches in America, or using Gmail, now seems to be enough. Imagine if China fined Amazon $5bn and jailed its executives for conducting business in Africa that did not break American law, but did offend Chinese rules and was discussed on WeChat.

Second, the punishments can be disproportionate. In 2014 bnp Paribas, a French bank, was hit with a sanctions-related fine of $8.9bn, enough to threaten its stability. In April ZTE, a Chinese tech firm with 80,000 employees, was banned by the Trump administration from dealing with American firms; it almost went out of business. The ban has since been reversed, underlining the impression that the rules are being applied on the hoof.

Third, America’s legal actions can often become intertwined with its commercial interests. As our investigation this week explains, a protracted bribery probe into Alstom, a French champion, helped push it into the arms of General Electric, an American industrial icon. American banks have picked up business from European rivals left punch-drunk by fines. Sometimes American firms are in the line of fire—Goldman Sachs is being investigated by the doj for its role in the 1mdb scandal in Malaysia. But many foreign executives suspect that American firms get special treatment and are wilier about navigating the rules.

America has much to be proud of as a corruption-fighter. But, for its own good as well as that of others, it needs to find an approach that is more transparent, more proportionate and more respectful of borders. If it does not, its escalating use of extraterritorial legal actions will ultimately backfire. It will discourage foreign firms from tapping American capital markets. It will encourage China and Europe to promote their currencies as rivals to the dollar and to develop global payments systems that bypass Uncle Sam…. Far from expressing geopolitical might, America’s legal overreach would then end up diminishing American power.

Excerpts from Tackling Corruption: Judge Dread, Economist, Jan. 19, 2019

How to Discover an Illegal Logger

Tropical forests nearly the size of India are set to be destroyed by 2050 if current trends continue causing species loss, displacement and a major increase in climate-changing greenhouse gas emissions.  Prior to the launch of the Global Land Analysis and Discovery (GLAD) alerts, researchers would have to manually track images of logging in specific areas.

The new process, developed by scientists at the University of Maryland and Google, uses an algorithm to analyze weekly updates of satellite images and sends automatic notifications about new logging activity.”This is a game changer,” said Matt Finer from the Amazon Conservation Association, an environmental group.

His organization tracks illegal logging in Peru, sending images of deforestation to policymakers, environmentalists and government officials to try and protect the Amazon rainforest.  In the past, he would rely on tips from local people about encroachment by loggers, then look at older satellite images to try and corroborate the claims.

“With this new data we can focus on getting actionable information to policy makers,” Finer told the Thomson Reuters Foundation.  “We have seen how powerful these images can be,” he said, citing a case where his group brought pictures of illegal gold miners cutting down trees to the Peruvian government, who then removed the miners.

Excerpt from  CHRIS ARSENAULT, New satellite program aims to cut down illegal logging in real time, Reuters, Mar. 2, 2016