Identifier
Created
Classification
Origin
04SANTODOMINGO148
2004-01-08 22:15:00
UNCLASSIFIED
Embassy Santo Domingo
Cable title:  

DOMINICAN REPUBLIC: 2003-2004 INTERNATIONAL

Tags:  SNAR DR 
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This record is a partial extract of the original cable. The full text of the original cable is not available.
UNCLAS SECTION 01 OF 07 SANTO DOMINGO 000148 

SIPDIS

DEPARTMENT FOR INL AND WHA/CAR
JUSTICE FOR OIA, AFMLS, AND NDDS
TREASURY FOR FINCEN
DEA FOR OILS AND OFFICE OF DIVERSION CONTROL

E.O. 12958: N/A
TAGS: SNAR DR
SUBJECT: DOMINICAN REPUBLIC: 2003-2004 INTERNATIONAL
NARCOTICS CONTROL STRATEGY REPORT (INCSR)

REF: A. STATE 324347


B. STATE 328024

UNCLAS SECTION 01 OF 07 SANTO DOMINGO 000148

SIPDIS

DEPARTMENT FOR INL AND WHA/CAR
JUSTICE FOR OIA, AFMLS, AND NDDS
TREASURY FOR FINCEN
DEA FOR OILS AND OFFICE OF DIVERSION CONTROL

E.O. 12958: N/A
TAGS: SNAR DR
SUBJECT: DOMINICAN REPUBLIC: 2003-2004 INTERNATIONAL
NARCOTICS CONTROL STRATEGY REPORT (INCSR)

REF: A. STATE 324347


B. STATE 328024


1. Text of Dominican Republic draft 2002-2003 INCSR follows.

Part One: Drugs and Chemical Control


I. Summary

The Dominican Republic (DR) is a major transit country for
South American drugs, mostly cocaine and heroin, moving to
the United States and Europe. The Government of the Dominican
Republic (GODR) continued to cooperate closely with the U.S.
in counternarcotics matters. Last year (2003) saw a decrease
in heroin seizures, an increase in cocaine interceptions, and
a decrease in seizures of MDMA (ecstasy); negligible
cooperation between the Government of the Dominican Republic
(GODR) and the Haitian police; continued good results of the
extradition process; and attempts to apply a strong
anti-money laundering law to a notorious bank fraud case.
(For details on the GODR's anti-money laundering initiatives
in 2003, see the Money Laundering section of this report.)
Although the GODR continued its efforts to combat corruption
in 2003, corruption and weak governmental institutions
remained an impediment to controlling the flow of illegal
narcotics through the DR. In 2003, an estimated eight
percent of the cocaine directed toward the U.S. flowed
through Hispaniola, and nearly half this amount reached the
DR's shores directly from South American sources. The DR is
a party to the 1988 UN Drug Convention.

II. Status of Country

There is no significant cultivation, refining, or
manufacturing of major illicit drugs in the DR. Dominican
criminal organizations are increasingly involved in command
and control of international drug trafficking operations, but
the country's primary role in regional drug trafficking is as
a transshipment hub.

Seizures in 2003 continued to indicate that cocaine, heroin,
and marijuana destined for the United States and, to a lesser
extent, Europe were being transshipped through the DR and its
territorial waters. Ecstasy seized in the DR was most often
being transported from Europe to the United States. Puerto
Rican authorities noted a decrease in drug smuggling via the
ferries operating between Puerto Rico and the DR, probably
due to the presence of a newly established counternarcotics
canine unit at the Santo Domingo ferry terminal.


Dominican nationals play a major role in the actual
transshipment of drugs. Many "go-fast" crews in the Caribbean
include Dominican nationals, mostly fishermen recruited from
the local docks. The crews speak Spanish, the language of the
source country smugglers; move easily throughout the
Caribbean; and are recruited for very small amounts of money.

The DR is not a producer of precursor chemicals, but there is
continued concern about their importation.

III. Country Actions Against Drugs in 2002

Policy Initiatives. The DR-initiated bilateral
intelligence-sharing and interdiction efforts with Haiti,
begun after Operation Hurricane in 2001, were not continued
in 2003. The DR has continued to participate in annual
Caribbean-wide counternarcotics operations.

The National Directorate for Drug Control (DNCD),the law
enforcement arm responsible for counternarcotics measures,
and the National Drug Council (CND),the GODR's policy and
planning organ, have adopted a computerized tracking system
and are able to track seizures of assets in connection with
drug-related offenses.

Following the collapse of BANINTER, the third-largest
Dominican bank, the Dominican Government struggled to
implement anti-money laundering legislation passed in 2002.
(See the Money Laundering section of this report.)

The GODR instituted training, with U.S. and other
international support, for implementing the revised criminal
procedures code in 2004. This code will change the Dominican
criminal system from a Napoleonic system, with a dossier of
evidence evaluated by a judge, to an adversarial system of
verbal process before a judge or a jury.

Law Enforcement Efforts. The DNCD increased its canine
program to 30 dogs and handlers. All canine teams were
recertified, and unit commanders were certified as dog team
trainers.

No multinational counternarcotics exercises were conducted
during 2003.
The DNCD led a multi-year, U.S. Government-supported effort
to share data among Dominican law enforcement agencies and to
make information available on demand by field officers.

Cultivation/Production. There is no known cultivation of coca
or opium poppy in the DR. Cannabis is grown on a small scale
for local consumption. The GODR's investigations into
possible in-country manufacture of MDMA (ecstasy) have
produced no definitive evidence of such activity.

Drug Flow/Transit. The DNCD maintained its seizure rate,
interdicting body-carried heroin and cocaine in the DR's
international airports and larger quantities from vehicles
and buildings. Through December 2003, with cooperation and
assistance of the U.S. Drug Enforcement Administration (DEA),
the DNCD seized 1,338 kilograms of cocaine, 59 kilograms of
heroin, 51,965 units of MDMA (Ecstasy),and 1174 pounds of
marijuana. Puerto Rican authorities seized 2,039 kilograms
of cocaine as a direct result of intelligence supplied by the
DNCD and the Santo Domingo DEA office. The DNCD continued to
focus interdiction operations on the drug-transit routes in
the DR's territorial waters along the northern border and on
its land border crossings with Haiti, while attempting to
prevent air drops and sea delivery of illicit narcotics to
remote areas. The DNCD and their DEA counterparts
concentrated increasingly on investigations leading to
takedown of large criminal organizations, and several
international rings were broken up as a result.

In 2003, drugs were easily accessible for local consumption
in most metropolitan areas. The DR attracted a growing number
of tourists from Europe, the United States, and Canada who
provided a customer base for local drug sales, especially at
the beachfront vacation resorts. Traffickers often used drugs
to pay low-level couriers and distributors.

The DNCD made 3929 drug-related arrests in 2003; of these,
3692 were Dominican nationals and 237 were foreigners. There
were 227 fewer drug-related arrests in 2003 than in 2002 and
62 fewer foreigners were among those arrested on drug charges
than in 2002.

Only 9 percent of the total cocaine and 61 percent of the
total heroin seized in the Dominican Republic was seized in
the airports. Seizures of Ecstasy were more successful in
airports, resulting in 77 percent of all Ecstasy pills seized
in the DR.

Most of the significant seizures were made on land, in the
big cities. There were some seizures made at the Haitian
border in 2003, but quantities seized were limited. While
the number of seizures made in Dominican airports was high,
the actual amount of drugs seized was small. Maritime
seizures remain a challenge for the DR, especially drugs
hidden in commercial vessels for shipment to the US and/or
Europe. In one December case, DNCD canine teams were
dispatched at a moment's notice to search a suspect freighter
in a small port near the Haitian border; that investigation
continues.

Extradition. The U.S.-Dominican Extradition Treaty dates from

1909. Extradition of nationals is not mandated under the
treaty, and for many years Dominican legislation barred the
extradition of Dominican nationals. Former President
Fernandez signed legislation in 1998 allowing the extradition
of Dominican nationals. In March 2000, the U.S. Marshals
Service assigned two marshals temporarily to the DR. They
received excellent cooperation from the DNCD's special
Section for Fugitive Surveillance and other relevant
Dominican authorities in locating fugitives and returning
them to the U.S. to face justice. The marshals were withdrawn
in 2002, then returned permanently during 2003.

President Mejia's administration generally maintained its
record of cooperation in 2003, and the GODR extradited 17
Dominicans to the United States during the year. The DNCD
arrested 20 fugitives in 2003 in response to U.S. extradition
requests. The National Police, working with the FBI, arrested
and extradited two drug-related subjects. Eight individuals
are now in custody pending extradition to the United States.

In December 2003, with no fanfare, one of six persons
arrested in the "Joselito.com" case and awaiting deportation
to the United States was released on orders of the Attorney
General. In response to Embassy protests, the Attorney
General cited supposed inadequacies in the extradition
request package. At year's end, President Mejia was aware of
USG concerns, but no further action had been taken.

Mutual Legal Assistance. The GODR cooperates with USG
agencies, including the DEA, FBI, U.S. Customs Service, and
U.S. Marshals Service on counternarcotics and fugitive
matters.

The DNCD housed and manned the DEA-sponsored Caribbean Center
for Drug Information (CDI) at its facilities in Santo
Domingo. An increasing number of Caribbean countries have
found the CDI's intelligence analysis services useful and are
now frequent contributors of new information.

The Dominican Navy received six renovated patrol craft and
two newly constructed 100 foot patrol ships, supplied under a
U.S. $22 million commercial contract with a U.S. company, and
plans were made to incorporate these vessels into
multilateral counternarcotics and anti-migration patrol
activities.

Corruption. The GODR does not, as a matter of government
policy, encourage or facilitate illicit production or
distribution of narcotics, psychotropic drugs, and other
controlled substances, nor does it contribute to drug-related
money laundering.

Dominican institutions remain vulnerable to influence by
interest groups or individuals with money to spend, including
narcotics traffickers. The GODR has not convicted any senior
government official for engaging in, encouraging, or in any
way facilitating the illicit production or distribution of
illicit drugs or controlled substances, or the laundering of
proceeds from illegal drug transactions.

Legislation remains pending that would strengthen enforcement
of a 1979 law that requires senior appointed, civil service,
and elected officials to file financial disclosure
statements. In what may be a regional model for transparency
and an indication of the seriousness of the Dominican
judiciary to uphold the ethical quality of employees, the
sworn financial disclosure statements for all Dominican
judges can be found on the Internet at
http//www.suprema.gov.do/jueces/dj.htm. Nonetheless, an
effective system to verify these statements has not yet been
implemented and there are no sanctions for false statements.

The GODR is a party to the Inter-American Convention Against
Corruption and in 2001 signed the consensus agreement on
establishing a mechanism to evaluate compliance with the
Convention.

Precursor Chemical Control. The Secretariat of Health is
responsible for the control of chemicals entering and
departing the DR. The CND has prohibited the re-exportation
of certain chemicals.

Domestic Programs (Demand Reduction). The DNCD conducted 79
youth events in various cities and neighborhoods, from
basketball tournaments to chess matches, reaching over
200,000 young people to encourage competitive and
recreational activities as better choices than drug abuse. A
non-governmental organization, Foundation for Life (FUNVIDA),
published with U.S. Government assistance a book entitled
"Schools Without Drugs" and distributed it gratis at several
neighborhood meetings in the capital area.

Agreements and Treaties. In 1984, the United States and the
DR entered into an agreement on international narcotics
control cooperation. In May 2003 the Dominican Republic
entered into three comprehensive bilateral agreements, on
Cooperation in Maritime Migration Law Enforcement, Maritime
Counter-Drug Operations, and Search and Rescue, granting
permanent overflight provisions in all three agreements for
the respective operations. The three agreements conclude a
long bilateral effort to secure permanent overflight
provisions; previous agreements provided only annual
provisions. In addition, the Maritime Counter-Drug Agreement
broadened the scope of operations agreed to by the parties.
The DR remains an active participant in ongoing negotiations
to reach a Caribbean regional maritime counternarcotics
agreement.

In 2002 the DR became the first country in the Western
Hemisphere to sign an Article 98 agreement exempting U.S.
military personnel in the DR from the jurisdiction of the
International Criminal Court (ICC). In 2001, the United
States and the DR exchanged instruments of ratification of
the Treaty for the Return of Stolen or Embezzled Vehicles.
Attempts to implement the treaty have been hampered by
organizational weaknesses within the Dominican bureaucracy,
and in 2003 no vehicles were repatriated under this treaty.

The DR has signed but not ratified the UN Convention against
Transnational Organized Crime, the Protocol to Prevent,
Suppress and Punish Trafficking in Persons, the Protocol
against the Smuggling of Migrants, and the Protocol against
the Illicit Manufacturing of and Trafficking in Firearms.

IV. U.S. Policy Initiatives and Programs

Cocaine and heroin trafficking, money laundering,
institutional corruption, and reform of the judicial system
remain the United States' primary counternarcotics concerns
in the DR. The USG and the GODR cooperate to develop
Dominican institutions that can interdict and seize narcotics
shipments and conduct effective investigations leading to
arrests, prosecutions, and convictions. The USG will continue
to urge the GODR to improve its asset forfeiture procedures
and its capacity to regulate financial institutions, develop
and maintain strict controls on precursor chemicals, and
improve its demand reduction programs.

During 2003, the United States provided essential equipment
and training to expand the counternarcotics canine units,
supported the DNCD's vetted special investigation unit and
border intelligence units, provided radio equipment to
facilitate communications along the DR's border with Haiti,
and funded assessments of airport and port security against
narcotics trafficking and terrorism. The United States
delivered three harbor patrol craft and a fully refurbished
go-fast boat, previously captured from drug smugglers, to the
Dominican Navy. The United States also assisted the Dominican
Navy in planning for a complete maintenance and training
program for its maritime assets. The cornerstone of this
effort is the reopening of the Navy's training and
maintenance school, closed in 1997. The first step,
establishment of a Navy maintenance command, was completed in

2003.

The United States has funded training to the DNCD Fugitive
Surveillance Unit, helping it locate, apprehend, and
extradite individuals wanted on criminal charges in the
United States. Enhanced computer training, database
expansion, and systems maintenance support were provided to
the DNCD.

The Dominican Navy and Air Force have a direct communications
agreement with the U.S. Coast Guard's regional operations
center (GANTSEC) in San Juan, Puerto Rico. Dominican Navy
vessels have participated in numerous maritime drug seizures.

USAID's "Strengthened Rule of Law and Respect for Human
Rights" program continues to work with the Dominican court
and prosecutorial system to improve the administration of
justice, enhance access to justice, and support
anticorruption programs. Improvements achieved to date
include speedier, more transparent judicial processes managed
by better trained, technically competent, and ethical judges
who insist upon stricter adherence to due process. The USAID
program continued to provide training to prosecutors in basic
criminal justice and prosecutorial skills. Several
high-profile investigations are ongoing.

The U.S. Department of Justice, through OPDAT, provided two
weeks of training to prosecutors and investigators on basics
of money laundering.

The U.S. Department of Homeland Security worked closely with
Dominican business associations to establish a Dominican
chapter of the Business Anti-Smuggling Coalition (BASC).
This voluntary alliance of manufacturers, transport
companies, and related private sector entities has agreed to
meet stringent security standards to prevent smuggling by
means of their operations and to receive surprise inspections
at any time. The BASC approach has proven successful in
other Latin countries in minimizing contraband and promoting
honest business activity.

A third privately owned airport, at La Romana, joined those
at Punta Cana and Santiago in upgrading counternarcotics
measures, including co-funding with the U.S. Government of a
DNCD canine unit.

The United States is planning to deploy a U.S. mobile
training team for the DNCD's border units and provide
increased support for Dominican naval patrols of the Mona
Passage.

With U.S. Customs leadership and DEA support, the Port
Authority improved security at the formerly chaotic Santo
Domingo terminal of the ferry to Puerto Rico. An ongoing
project has improved passenger processing and established
controls to detect and prevent smuggling of drugs and other
contraband. Customs also advised the owners of the new
Caucedo container terminal, which began limited operations in
December.

The Drug Enforcement Agency (DEA)-funded Caribbean Center for
Drug Information at DNCD headquarters now permits real-time
sharing and analysis of narcotics-related intelligence among
all the nations of the Caribbean Basin. Similar centers are
established in Mexico, Colombia, and Bolivia.

USG training programs have also targeted the DR military's
intelligence units in order to improve their capacity to
analyze, detect and interdict narcotics shipments. Two
military officers received counternarcotics training at Fort
Benning, Georgia.

The Road Ahead. The immediate U.S. goal remains helping to
institutionalize judicial reform and good governance. The DR
and U.S. are working to build coherent counternarcotics
programs that can resist the pressures of corruption and can
address new challenges brought by innovative narcotics
trafficking organizations.

The U.S. Government and the GODR will continue strengthening
drug control cooperation through sharing of information and
developing closer working relations among principal agencies.
The United States will continue providing training and
equipment for the DNCD, focusing its attention on the
information technology and intelligence exchange necessary to
disrupt narcotics smuggling at Dominican land and sea borders
and at airports. Support for the retraining and
re-certification of the DNCD canine units will continue, as
will establishment of new canine units in cooperation with
DNCD. The DNCD's fugitive investigation teams will continue
to receive hands-on U.S. support for their efforts pursuing
Dominican fugitives from U.S. justice seeking refuge in the
DR. The USG will continue to provide support to Dominican
government and private sector counternarcotics efforts,
including provision of specialized technical equipment and
support of business and civil society demand reduction
efforts.

USAID and the U.S. Department of Justice's Office of Overseas
Prosecutorial Development, Assistance and Training (OPDAT)
will provide further training to prosecutors and
investigators, increasing their professionalism and ensuring
that they are prepared to implement the new Criminal
Procedures Code when it becomes effective in 2004. U.S.
support for civil society's and the Mejia administration's
efforts to curb corruption will continue, regardless of the
outcome of 2004 presidential elections, through U.S.-funded
programs to strengthen the Attorney General's Anticorruption
Prosecution Department and through monitoring and reporting
compliance with the Inter-American Convention Against
Corruption.

The USG will continue to work closely with the Anti-Money
Laundering Commission to ensure full implementation of the
Anti-Money Laundering Law.


Part Two: Financial Crimes and Money Laundering

Dominican Republic. The Dominican Republic remains a key
point for the transshipment of narcotics moving from South
America into Puerto Rico and the United States. The Dominican
Republic's financial institutions engage in currency
transactions involving international narcotics-trafficking
proceeds that include significant amounts of U.S. currency or
currency derived from illegal drug sales in the United
States. The smuggling of bulk cash by couriers, and wire
transfer remittances, are the primary methods for moving
illicit funds from the United States into the Dominican
Republic. Once in the Dominican Republic, currency exchange
houses and money remittance companies facilitate the
laundering of these illicit funds.

In 2003, counternarcotics authorities of the DNCD pursued
nine cases of money laundering related to narcotics,
arresting three persons and seizing a total of 29 vehicles,
18 firearms, 12 buildings, and USD 184,701 in cash. Most of
these seizures were connected with one large case.

During 2003, three Dominican banks failed, including the
third largest in the nation, BANINTER, where some USD 2.2
billion evaporated over several years. Failure of two
smaller banks, Banco Mercantil and BANCREDITO, brought the
total loss to about three billion. Charges of bank fraud were
filed against five individuals related to BANINTER, but all
were later released on bail. Preliminary investigations
revealed no useful information as to the sources of the
missing BANINTER funds or the presence of laundered accounts,
but despite GODR guarantees for all depositors, several large
accounts carried on bank books remained unclaimed by the
owners.

There have been notable legislative and regulatory efforts by
the Government of the Dominican Republic (GODR) to combat
drug trafficking, corruption, money laundering, and
terrorism. Narcotics-related money laundering has been a
criminal offense since the enactment of Act 17 of December
1995 (the "1995 Narcotics Law"). The Act allows preventive
seizures and criminal forfeiture of drug-related assets, and
authorizes international cooperation in forfeiture cases.
While numerous narcotics-related investigations were
initiated under the 1995 Narcotics Law and substantial
currency and other assets confiscated, there have been only
three successful money laundering prosecutions under the 1995
Narcotics Law.

Under Decree No. 288-1996, the Superintendency of Banks,
banks, currency exchange houses, and stockbrokers are
required to know and identify their customers, keep records
of transactions (five years),record currency transactions
greater than USD 10,000, and report suspicious financial
transactions (SARs) to the Superintendency of Banks.

In 1997, a Financial Analysis Unit (FAU) was created within
the Superintendency of Banks to receive, analyze, and
disseminate SAR information. The FAU also refers SARs to the
Financial Investigative Unit of the DNCD for follow up
investigation. The FAU is a member of the Egmont Group, and
is authorized to exchange information with other Financial
Intelligence Units. In 1998, the GODR passed legislation that
allows extradition of Dominican nationals on money laundering
charges.

In June 2002, the GODR augmented its measures to prevent and
combat money laundering, drug trafficking, and related
activities, with the passage of Law No. 72-02. This law
expanded the predicate offenses for money laundering beyond
illicit trafficking in drugs and controlled substances, to
include other serious crimes such as any act related to
terrorism, illicit trafficking in human beings or human
organs, arms trafficking, kidnapping, extortion related to
recordings and electronic film made by physical or moral
entities, theft of vehicles, counterfeiting of currency,
fraud against the State, embezzlement, and extortion and
bribery related to drug trafficking. It broadened the
requirements for customer identification, recordkeeping of
transactions, and reporting of SARs, to numerous other
financial sectors including: securities brokers; the Central
Bank; cashiers of checks or other types of negotiable
instruments; insurers/sellers/cashers of travelers checks or
money orders; credit/debit card companies; funds remittance
companies; offshore financial service providers; casinos;
real estate agents; automobile dealerships; insurance
companies; and certain commercial entities such as those
dealing in firearms, metals, archeological artifacts,
jewelry, boats, and airplanes.

Law No. 72-02 also requires the reporting of cash
transactions greater than USD 10,000 to the FAU; until now
these needed only to be recorded internally by the financial
institutions. Moreover, the legislation requires individuals
to declare cross-border movements of currency that are equal
to or greater than the equivalent of USD 10,000 in domestic
or foreign currency.

The GODR responded to U.S. Government efforts to identify and
block terrorist-related funds. Although no assets were
frozen, efforts continue through orders and circulars issued
by the Ministry of Finance and the Superintendency of Banks,
instructing all financial institutions to continually monitor
accounts. On November 15, 2001, the GODR signed, but has not
yet become a party to, the UN International Convention for
the Suppression of the Financing of Terrorism. The Dominican
Republic is a member of the Caribbean Financial Action Task
Force (CFATF) and of the Organization of American States
Inter-American Drug Abuse Control Commission (OAS/CICAD)
Experts Group to Control Money Laundering. The Dominican
Republic is a party to the 1988 UN Drug Convention and a
signatory to the UN Convention against Transnational
Organized Crime (December 2000),which is not yet in force
internationally. Cooperation with U.S. Government law
enforcement on fugitive and extradition matters remains
strong.

Effective implementation of the anti-money laundering law of
June 2002 constitutes a priority for the Dominican Republic,
as well as sustained anti-corruption efforts. The GODR
should also remain vigilant concerning controls relating to
its many free zones, which may represent vehicles to
facilitate money laundering.



Dominican Republic Statistics
(1993-2003)
2003 2002 2001 2000 1999 1998 1997
1996 1995 1994 1993
Seizures

Cocaine (mt) 1.3 1.1 1.8 1.27 1.01 2.34 1.35
2.14 3.60 2.80 1.07
Heroin (mt) 0.059 0.115 0.017 0.020 0.012 0.069 0.008
0.005 - - -
Marijuana (mt) 0.5 1.7 3.794 2.90 0.18 0.11 0.78
1.01 1.00 6.81 0.31

Arrests/Detentions

Nationals 3,692 3,857 3,496 4,454 3,918 1,676 1,431
3,097 3,388 2,810 -
Foreigners 237 299 212 161 111 - 50
69 11 158 -
Total Arrests 3,929 4,156 3,708 4,615 4,029 1,676 1,481
3,166 3,399 2,968 5,635
MARSHALL