PARAGUAY'S 2005 FIRST QUARTER INL REPORT

UNCLAS SECTION 01 OF 03 ASUNCION 000503 SIPDIS STATE FOR INL ABBY SMITH STATE FOR WHA/BSC AND EB/IFD/OIA NSC FOR KIM BREIER SOUTHCOM FOR POLAD DAN JOHNSON E.O. 12958: N/A TAGS: SNAR PA KCRM SUBJECT: PARAGUAY'S 2005 FIRST QUARTER INL REPORT ¶1. Summary - Quarterly activities - Program discussion - Quarterly SENAD statistics ¶2. Quarterly Activities Counternarcotics -------------- In January, SENAD agents arrested Brazilian narcotrafficking fugitive Nilton Cesar Antunez, associated with the Beira Mar drug trafficking organization, as well as two of his associates and seized 103 kilograms of cocaine. Until the time of his arrest, Antunez reportedly had been involved in plotting an assassination attempt on the Governor of Amambay Department, Roberto Acevedo, and three other unnamed individuals. In response to these threats, DEA and SENAD worked closely with the Brazilian Federal Police, to provide timely information on Antunez's movements. Authorities located and arrested Antunez on January 16. The extradition case against Brazilian narcotrafficking kingpin Mendes-Mesquita is still ongoing and is proceeding according to Post's expectations. The judge signed the extradition order on April 1, and the case is currently in the appeals process. On the same day, Paraguay extradited three other Brazilian narcotraffickers to Brazil. Reports in the first quarter of 2005 indicate that Brazil's new shootdown policy, passed in October 2004, is starting to make an impact on narcotraffickers' strategy, forcing them to land their planes in Paraguay's Chaco region and smuggle their narcotics across the border to Brazil. After just two months of the law's passage, the number of irregular flights over Brazil's air space has dropped by half, according to Brazilian authorities. On February 24, Paraguayan daily newspaper, La Nacion, published an OpEd from the Ambassador describing the United States' National Drug Control Strategy. The article was published to raise awareness in Paraguay that the USG focuses a significant amount of its anti-narcotics budget on prevention and treatment, not only interdiction. In March, INL Program Officer Abby Smith visited post. Ms. Smith, accompanied by PolCouns and INL assistant, met with representatives from SENAD, SEPRELAD (Paraguay's anti-money laundering secretariat),the Ministry of Women, and the Ministry of Industry and Commerce. POL Chief, PolOff, and DEA Director also accompanied Ms. Smith to Pedro Juan Caballero to meet with Amambay Governor Acevedo as well as local judges and prosecutors on drug trafficking in the region and to visit the site for construction of the new SENAD office with funds from the Andean Initiative account. The trip was well-covered by local radio and national press. Approximately a dozen individuals gathered outside of the Governor's offices to protest the visit, charging the U.S. with seeking to exploit the region's aquifer. (Note: a recurring a "anti-imperalist theme is the claim that the U.S. plans to establish a base for intervention and to steal Paraguay's water. End Note). On March 12, convicted Brazilian drug trafficker Fabricio Silveira Machado escaped from Asuncion's Tacumbu prison, where he was serving a 25-year sentence for homicide and assault with a deadly weapon. The day before his escape, March 11, a Paraguayan judge signed an extradition order to send Machado to Brazil. Press reports indicate Machado bribed prison guards with payments of $3,200 for his release. Authorities located one prison guard and discovered Machado's bribe money in his possession. Seized assets from Brazilian drug trafficker Claudair Lopes de Faria were sold on March 22 in a public auction in which his home furnishings, real estate, and an airplane grossed 1.1 billion Guaranis (USD 171,000). Since Lopes was arrested based on drug charges in Brazil and not Paraguay, the usual 70/30 split of seized assets between SENAD and the Ministerio Publico does not apply. Instead, the revenue will be split 30/30/30/10 among SENAD, the Ministerio Publico, the Poder Judicial and an as-yet undetermined non-profit organization. SENAD's attorneys will be asking the judge to reconsider this distribution, however. Lopes de Faria was arrested by Paraguayan authorities in June 2003 and expelled to Brazil where he was sentenced to 480 years in prison for narcotics trafficking. Intellectual Property Rights -------------- On February 17, operatives from the Unidad Tecnica Especializada (UTE) conducted a raid on several premises located in a popular shopping district, Mercado 4, in Asuncion. Over 300,000 forged holograms and more than 20,000 pirated videos, CDs and DVDs were seized. Trafficking in Persons -------------- In February, a teenage female prostitution ring was dismantled in Lambare (a suburb of Asuncion). Three women were charged with forcing minors into prostitution. The brothels were posing as employment agencies and preying on young girls coming from the interior of Asuncion to look for employment. INL funds are being used to renovate an existing office to establish a support center for victims of trafficking to be run by the Ministry of Women. A vendor was selected at the end of March and worked is planned to begin in April. ¶3. Program Discussion: a. Demand Reduction This quarter, the SENAD demand reduction team has conducted 5 formal training sessions training 103 people and 481 informative sessions reaching over 15,000 students. Activities will continue in the Central Department (where Asuncion is located) throughout the second quarter. b. Narcotics Detection Canine Program No canine-related seizures were made this quarter. c. Eradication Operations From January 11 to 18, SENAD agents destroyed 223 hectares of marijuana during an operation in the Department of Amambay. From January 31 to February 9, SENAD conducted an eradication operation in the Department of Amambay with Brazil as part of the ongoing Alianza (Alliance) eradication efforts. Agents destroyed 221 hectares (663,000 kilos) of marijuana. From February 22 to March 1, SENAD conducted an operation in Canindeyu, where drug traffickers forced out of Amambay (Pedro Juan Caballero) have relocated. Agents destroyed 216 hectares of marijuana and seized an additional 4,670 kilos of cut marijuana and destroyed 29 workers' campsites. In March, SENAD conducted an operation in San Pedro eradicating 63 hectares of marijuana. This eradication took place in connection with the GOP's deployment of the police and military to San Pedro ostensibly for the purpose of tracking down the kidnappers of Cecilia Cubas and instilling a greater sense of public security in the region. d. Law Enforcement ¶1. Counter Narcotics In addition to the 103 kilos of cocaine seized during the arrest of Brazilian narcotrafficking fugitive Nilton Cesar Antunez mentioned above, there was a seizure of 1 kilo of cocaine from a Bolivian in Pedro Juan Caballero who was considered by SENAD to be an important "mule" in that area. ¶2. Money Laundering and Financial Crime Hijazi case - The tax evasion case against Kasem Hijazi, owner of Telefax, an illegal casa de cambio in Ciudad del Este was presented for accusation on February 8. A trial date has not been set. Prosecutors immediately began planning an investigation of authorized casas de cambio through which Hijazi moved money to the U.S. and supposedly on to the Middle East. In response to Embassy prodding, prosecutors provided copies of the materials used to indict Hijazi to the financial investigative unit (FIU) SEPRELAD UAF for entry into the FIU database in preparation for further investigations. ¶3. Rule of Law/Judicial Reform In March, Post's Resident Legal Advisor organized a visit to Puerto Rico for five lead prosecutors from units that prosecute sophisticated or complex economic criminal violations and five judges representing most of the differing strata and functions of the criminal court in Paraguay to observe US judicial proceedings. This visit, as part of a series of training efforts, has yielded a unified view among participants regarding Code modifications needed to build effective cases. Formal changes in the Code will require careful appeals to key legislators to adopt the proper legislation. ¶4. Training In March, INL sponsored a training course conducted by ATF officials from Embassy Bogota on firearms identification. ¶5. Miscellaneous Issues Quarterly SENAD statistics 1st 2nd 3rd 4th Cocaine 105.9kg Seized (kg) Marijuana 25,601kg Seized (kg) Marijuana 761 hectares Crops Destroyed Arrests 17 (total) - Cocaine 10 - Marijuana 0 (cultivation) - Marijuana 6 - Counterfeit 0 Currency - Int'l Trafficking 1 Firearms - Trafficking 0 Narcotics - Illegal Entry 0 - Money Laundering 0 - Result of 0 Investigation KEANE