Tag Archives: laundering illegal logs

Rich Environmental Criminals

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“The brutality and profit margins in the area of environmental crime are almost unimaginable. Cartels have taken over entire sectors of illegal mining, the timber trade and waste disposal,” according to Sasa Braun, intelligence officer with Interpol’s environmental security program  Braun listed examples. Villages in Peru that had resisted deforestation efforts had been razed to the ground by criminal gangs in retribution, he said, while illegal fishing fleets had thrown crew overboard to avoid having to pay them.

Environmental crime has many faces and includes the illegal wildlife trade, illegal logging, illegal waste disposal and the illegal discharge of pollutants into the atmosphere, water or soil. It is a lucrative business for transnational crime networks. Illegal waste trafficking, for example, accounts for $10 to 12 billion (€10.28 to 12.34 billion) annually, according to 2016 figures from the United Nations Environment Program. Criminal networks save on the costs of proper disposal and obtaining permits. For some crime networks, the profits from waste management are so huge that it has become more interesting than drug trafficking…The profits from illegal logging have also grown…

According to the European Union Agency for Law Enforcement Cooperation (Europol), environmental crime — the third most lucrative area of crime worldwide after drug trafficking and counterfeit goods — generates profits of between $110 billion and $280 billion each year.

Excerpts from Environmental crime: Profit can be higher than drug trade, DW, Oct. 16, 2022

To Steal To Survive: the Illegal Lumberjacks of the Amazon

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The Amata logging company was supposed to represent an answer to the thorny problem of how countries like Brazil can take advantage of the Amazon rainforest without widespread deforestation.  But after spending tens of millions of dollars since 2010 to run a 178-square-mile concession in the rainforest to produce timber sustainably, Amata pulled out in April 2020. The reason: uncontrolled wildcat loggers who invaded Amata’s land, illegally toppling and stealing trees.

Amata’s executives in São Paulo said that instead of promoting and protecting legal businesses, Mr. Bolsonaro’s administration did next to nothing to control the illegal loggers who invaded the concession in the western state of Rondônia. “It’s a conflict area,” Amata Chief Executive Ana Bastos said of the land granted to the company. “Those lumberjacks steal our lumber to survive. If we try to stop them, they will fight back. It will be an eternal conflict.”

Since they pay no taxes and make no effort to protect certain species or invest in restoration, illegal loggers can charge $431 per square meter of lumber, compared with $1,511 per square meter of legally logged timber, concession operators said.  “It is like having a regular, taxpaying shop competing with lots of tax-free peddlers right in front of your door,” said Jonas Perutti, owner of Lumbering Industrial Madeflona Ltda., which also operates concessions in the Amazon…

“The organized crime that funds illegal activity in the Amazon—including deforestation, land grabbing, lumber theft and mining—remains strong and active,” said Carlos Nobre, a Brazilian climate scientist. “It seems [the criminals] aren’t frightened by the government’s zero-tolerance rhetoric or don’t believe it’s serious.”…

Wildcat loggers are among the Amazon’s poorest residents, and many feel they have an ally in Mr. Bolsonaro,[Brazil’s President]…“There’s much corruption in law enforcement, and consumers don’t care if the wood they are buying is legal or not,” said Oberdan Perondi, a co-owner of a concession that is five times as large as Amata’s and also competes with illegal loggers.

Excerpt from Paulo Trevisani and Juan Forer, Brazil Wanted to Harvest the Amazon Responsibly. Illicit Loggers Axed the Plan, WSJ, Oct. 28, 2020

100 Ways to Finance Criminal Cartels Logging Forests

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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

Why Illegal Logging Persists

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The European Union (EU) adopted in 2010 Regulation (EU) No 995/2010 laying down the obligations of operators who place timber and timber products on the market (the Timber Regulation,, as part of the implementation of the Action Plan on Forest Law Enforcement, Governance and Trade……[The EU adopted the Regulation because] llegal logging is a pervasive problem of major international concern. It has a devastating impact on some of the world’s most valuable remaining forests as well as on the people who live in them and who rely on the resources that forests provide. It contributes to tropical deforestation and forest degradation, which may be responsible for 7 to 14%3 of total CO2 emissions from human activities; it threatens biodiversity and undermines sustainable forest management and has a negative impact on poverty reduction…..

The following major challenges to the effective application of the Timber Regulation have been identified in the evaluation process: insufficient human and financial resources allocated to the [authorities dealing with implementation], varying types and level of sanctions across EU states and a lack of uniform understanding and application of the Regulation throughout the EU. Those challenges have translated into uneven enforcement, which creates a non-level playing field for economic operators….

In order to address the shortcomings identified, EU states should significantly step up their implementation and enforcement efforts. The current level of technical capacity and resources (both human and financial) allocated to the [authorities dealing with implementation] does not match with the needs and must be reinforced in most of the Member States with the aim to increase the number and quality of compliance checks.

Excerpts from REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL Regulation EU/995/2010 of the European Parliament and of the Council of 20 October 2010 laying down the obligations of operators who place timber and timber products on the market (the EU Timber Regulation, Feb. 18, 2016,  COM(2016) 74 final