BURMA: HISTORIC HEROIN BUST REVEALS MAJOR

C O N F I D E N T I A L SECTION 01 OF 02 RANGOON 001056

SIPDIS

STATE FOR EAP AND INL; DEA FOR OF, OFF;
USPACOM FOR FPA

E.O. 12958: DECL: 05/30/2013
TAGS: SNAR PREL PGOV KCRM KISL BM
SUBJECT: BURMA: HISTORIC HEROIN BUST REVEALS MAJOR
SMUGGLING SYNDICATE

REF: RANGOON 887 (NOTAL DEA REPORT)

Classified By: CDA, a.i. Ron McMullen for Reasons 1.4 (B,D)


1. (C) Summary: Burma's largest heroin seizure in history
(592 kilos seized along the southern coast in early July) has
uncovered a major drug trafficking syndicate with possible
connections to traffickers and markets in Thailand, Vietnam,
Hong Kong, Indonesia, Australia, India, and the United
States. Unusually, most of the local players are Muslim
Sino-Burmese, with no ties to traditional traffickers based
in the ethnic Wa and Kokang regions on the Chinese border.
Likewise, the seized heroin appears to have originated in the
Taunggyi area of southwest Shan State--not in Wa territory,
Burma's traditional source for major heroin shipments. More
importantly perhaps, a post-seizure investigation has shed
further light on a major sea-shipping route from Rangoon to
the Andaman Sea, one which the GOB has virtually no capacity
to thwart and may well offer drug traffickers a viable,
low-risk option to move their product for the foreseeable
future. End Summary.


2. (U) A/DCM and PolEconoff met on August 13 with Burmese
Police Colonel Hkam Awng to discuss details about an ongoing
investigation into the seizures by GOB authorities of 592
kilos of heroin in Tanintharyi (Tenasserim) Division in
southern Burma (reftel). Colonel Hkam Awng, as Joint
Secretary of Burma's Central Committee for Drugs Abuse

SIPDIS
Control (CCDAC),is the GOB's lead working-level counterdrug
official. He described the combined seizure (well over 500
kilos seized on July 9 and more than 70 kilos seized during
subsequent searches) as the largest in Burmese history and
one of the most significant in the world, with a "street
value" of over USD 75 million.


3. (SBU) According to Hkam Awng, the July 9 seizure was a
case of good luck. Local police in a small village on
Burma's southern coast arrested a "suspicious" character on
July 8, which led to additional arrests and the first of two
related heroin seizures on the following day. As reported
reftel, a follow-on investigation determined that in late May
smugglers were originally trafficking the heroin via a small
fishing vessel through the Gulf of Martaban, just south of
Rangoon, when crew members mutinied, murdered the vessel
owner and two others, and brought the heroin ashore for
storage.


4. (C) Hkam Awng said that as a result of the seizure, the
GOB has uncovered a major heroin trafficking syndicate.
Burmese police have to date arrested 36 Burmese persons and
are cooperating closely with the DEA, the Australian Federal
Police, and Thai drug officials. The investigation has thus
far revealed possible connections to heroin traffickers and
markets in Thailand, Vietnam, Hong Kong, Indonesia,
Australia, India, Seattle, Los Angeles, San Francisco, and
Dallas. Despite insights gained on the operational aspects
of the syndicate, however, investigators have been unable to
trace all financial flows associated with the heroin
transactions.


5. (C) Hkam Awng said that although the syndicate "kingpins"
appear to be based in Taiwan and/or Hong Kong, most of the
local players are young (late 20s, early 30s) Muslim
Sino-Burmese men and women from Kengtung in eastern Shan
State. These individuals appear to have no ties to
traditional Sino-Burmese drug traffickers, older men who are
based in the ethnic Wa and Kokang border regions of northern
Shan State. A second unusual aspect is that the heroin
seized appears to have originated in the Taunggyi area of
southwest Shan State, a region that has experienced a
dramatic decline in poppy cultivation in recent years, unlike
northern Wa territory along the China border which is Burma's
principal, and growing, source of poppy, opium, and heroin
(as well as ATS).


6. (C) Colonel Hkam Awng said that although the GOB was
vaguely aware that traffickers had started shipping heroin
south through Rangoon, the July 9 bust shed significant light
on a major sea-shipping route--the scope of which has
"shocked and surprised" GOB authorities. GOB investigators
have since discovered that the syndicate behind the July 9
case has been operative since 2002 and is responsible for the
trafficking of at least 2,000 kilos of heroin by land from
Shan State to Rangoon and then onward to the Andaman Sea.
The July 9 seizure was the fifth in a series of shipments,
but, said Hkam Awng, "we missed the first four, which
averaged over 400 kilos each."


7. (SBU) According to Hkam Awng, the syndicate's modus
operandi has been to ship heroin from Rangoon by small
fishing trawlers under cover of darkness. Concealment of the
drugs is rudimentary at best (i.e. heroin packed into
coolers),but the traffickers are equipped with high-tech
communication equipment including radios, satellite phones,
and GPS devices. The small boats then rendezvous south of
Burma in the Andaman Sea with large cargo vessels. In the
case of the July 9 seizure, for example, traffickers had
originally planned to transfer their heroin shipment to a
1,000-plus ton Vietnamese-flagged cargo vessel.


8. (C) Comment: The GOB, Colonel Hkam Awng acknowledges, has
a serious problem on its hands. The July 9 heroin seizure
and related arrests are good news for the country's
counterdrug professionals and may have disrupted a
substantial international syndicate. However, the
investigation into the July 9 case has also fully exposed a
drug trafficking route which Burma has virtually no capacity
to thwart. The country has no Coast Guard and its poorly
equipped Navy has no counterdrug mandate. Customs inspection
capabilities fall well below international standards and the
ports are notoriously corrupt. Absent senior-level GOB
attention, substantial domestic resources to detect coastal
trafficking activities, and close cooperation from
neighboring countries, the "southern sea route" may well
offer drug traffickers a viable, low-risk option to move
their product for the foreseeable future. End Comment.
McMullen