PARAGUAY'S 2005 SECOND QUARTER INL REPORT

UNCLAS SECTION 01 OF 04 ASUNCION 000870

SIPDIS

STATE FOR INL ABBY SMITH
STATE FOR WHA/BSC AND EB/IFD/OIA
NSC FOR KIM BREIER AND SUE CRONIN
SOUTHCOM FOR POLAD DAN JOHNSON

E.O. 12958: N/A
TAGS: SNAR PA KCRM
SUBJECT: PARAGUAY'S 2005 SECOND QUARTER INL REPORT


1. (U) Summary:

- Quarterly activities
- Program discussion
- Quarterly SENAD statistics

Quarterly Activities- Counternarcotics
--------------


2. On April 14, two agents from SENAD's Operations Unit
arrested three police officers and two employees of the
Public Ministry's Judicial Investigative Center (CIJ) on
charges of extortion. The gang allegedly kidnapped the
two-year old son of a woman whom they blackmailed for USD

1000. They also threatened to bring drug trafficking charges
against the woman who admitted to the DOA agents she had
traveled to Spain transporting cocaine. The employees of the
CIJ had identified themselves as DOA agents in telephone
calls to the woman demanding the ransom. The case broke
however, when the woman lodged a complaint with the Attorney
General's office, implicating police and CIJ officials
leading to their arrest.


3. According to press reporting, on April 17 Brazilian
authorities conducting a counterdrug operation shot down a
twin-engine Piper Aztec as the pilot attempted to take off
and escape after refueling in Brazilian territory. The pilot
was killed and the co-pilot wounded. The men were Brazilian
nationals and reportedly have prior convictions for
trafficking-related offenses. The authorities estimate they
were transporting 500 kg of marijuana and 30 kg of cocaine,
which they dropped from the plane over Uruguayan territory.
Authorities recovered over 100 kg of the marijuana, which
they believe to be of Paraguayan origin. Flight records show
the plane flew through Paraguay and Colombia.


4. On April 28, an INL-funded SENAD canine unit detected 32
kilograms of marijuana during a routine check of a Sao
Paulo-bound bus near the Friendship Bridge connecting Ciudad
del Este to Foz do Iguacu, Brazil. The bus originated from
Asuncion. Kilo, one of SENAD's drug dogs, discovered the
marijuana in two backpacks and one large bag belonging to two
young men from Caaguazu, Paraguay. SENAD agents arrested the
individuals and placed them in a local jail until their trail
date was set.


5. On May 9, SENAD agents captured 50-year old Brazilian
pilot Joao Freitas de Carvalho in Pedro Juan Caballero.
Freitas is wanted in Brazil for trafficking cocaine for
Fernandinho Biera Mar, Claudaire Lopes de Faria, and Ivan
Mendes Mesquita. SENAD believes Freitas was involved in a
plot to help Mendes Mesquita escape from a detention center
prior to his extradition to the United States. There are no
charges pending against Freitas in Paraguay. GOP officials
are processing Brazil's request for Freitas extradition.


6. A SENAD drug dog, Bonita, detected 995 grams of cocaine
concealed in a shipment of backpacks from Ciudad del Este
enroute to Cameroon. The drugs were concealed inside metal
backpack frames, each backpack containing around 90 grams of
cocaine. SENAD along with two prosecutors thoroughly
searched the shipments and took photographs of the backpacks,
showing improved investigation abilities and aggressiveness.
In mid-May, authorities arrested one individual in Ciudad
del Este suspected of mailing the package and SENAD continues
to search for another suspect. On May 19, SENAD agents in
CDE seized five kilograms of cocaine and arrested a Nigerian
national also involved in this case.


7. According to local press, Brazil deployed Army, Air
Force, and Navy units to its border with Paraguay to control
strategic points through which contraband, arms, and drugs
could enter. The military operation named "Jaura II" covered
the Brazilian states of Mato Grosso, Mato Grosso do Sul, and
the northeastern region of Parana. There was little public
Paraguayan reaction to these exercises.


8. On June 14, SENAD drug dog, Bonita, detected 31 kilograms
of marijuana hidden in a piece of luggage during a routine
check of a bus traveling to Ciudad del Este. The drugs were
concealed in 50 paper packets wrapped around a porcelain tea
set.


9. On June 22, the Cassation Tribunal of the Supreme Court
rejected Carlos Ivan Mendes Mesquita's appeal, clearing the
way for his extradition to the United States. Mendes
Mesquita's turnover to US authorities took place on June 27,
after several final judicial and administrative steps were
completed. The GOP took extraordinary security precautions
against possible bribes or violence to free Mendes Mesquita.
Mendes Mesquita is the first major trafficker turned over to
the U.S. by Paraguay and his extradition is a dramatic step
against the FARC-linked trafficking organization.

Trafficking in Persons (TIP)
--------------


10. Paraguay's Ambassador to Argentina Orlando Fiorotto,
Argentina's Ambassador to Paraguay Rafael Edgardo Roma, and
Paraguay's Director of the Repatriation Office, Nicasia
Maldonado met in Asuncion to discuss proceedings in the case
of 29 Paraguayan females--of which two are minors--who had
been tricked into prostitution and were discovered in early
May in Cordoba, Argentina during a roundup of brothels.
Maldonado later traveled to Cordoba with the Minister of
Women, Maria Jose Argana Mateu, to prepare for the return of
these women. Ambassador Fiorotto stressed to the press the
importance that Paraguay attaches to the investigation of
this case and the prosecution of those involved.


11. In April, an Appeals Court overturned a conviction of
two defendants from Villarica in a TIP case on grounds
Spanish authorities have jurisdiction since the crime was
concluded there. The case has gone to the Supreme Court for
review. Ministry of Women representatives have stressed the
importance of reinstating the conviction. We are raising the
case as well with the Supreme Court.


12. On June 8, the Ministry of Women inaugurated a new
center for the rehabilitation of victims of trafficking in
persons (TIP). The Center is funded in part through the
memorandum of understanding, signed last September, which
granted USD 155,000 to assist the GOP in combating TIP. The
center will be staffed with psychologists, sociologists, and
attorneys to assist victims who have been recently
repatriated to Paraguay. The Ministry will also sponsor
training seminars for local authorities to raise awareness
about TIP issues and how the Center can assist victims,
including the filing of criminal charges. The Minister of
Women, Maria Jose Argana Mateu, and the Ambassador both spoke
at the event highlighting the importance of combating
Trafficking in Persons in Paraguay. The Center opened in late
June.

Intellectual Property Rights (IPR)
--------------


13. The Specialized Technical Unit (UTE) of the Ministry of
Industry and Commerce conducted 12 raids over the last
quarter, six were conducted in Ciudad del Este, three in the
country's interior, and three in Asuncion respectively. UTE
seized goods during each operation, including thousands of
falsified compact discs, DVDs, cell phone batteries, cell
phone covers, and ink and toner cartridges. The operations
were not limited to these specific products, as authorities
also seized falsified products ranging from Coca-Cola bottles
to sporting equipment. The largest raid took place on May
27-28 in Asuncion, where UTE officials seized over 147,000
pirated compact discs from 16 businesses, the attorney
general's office is investigating three individuals arrested
in the operation.



14. Program Discussion:

a. Demand Reduction

This quarter the SENAD demand reduction team conducted 525
information sessions reaching over 16,000 students at 80
educational institutions in the Central Department (where
Asuncion is located). In addition, the team conducted 14
formal training sessions to 460 primary school teachers. On
June 23, SENAD commemorated the "International Battle Against
the Use and Trafficking of Illicit Drugs Day" with a ceremony
attended by Vice-President Castiglioni, SENAD Minister
Ibarra, and Ambassador Keane.

b. Narcotics Detection Canine Program

SENAD's canine unit assisted in the seizure of marijuana and
cocaine in three different operations. The dogs discovered
over 63 kilograms of marijuana and 6 kilograms of cocaine.
c. Eradication Operations

This quarter SENAD focused its eradication operations in the
Departments of Amambay and Canindeyu. In two separate
operations, SENAD agents destroyed 219 hectares (657,000
kilos) of marijuana and seized an additional 1,270 kilograms
of cut marijuana. Authorities also destroyed 57 workers'
campsites and equipment.

d. Law Enforcement


1. Counter Narcotics

In addition to the above operations, on April 1, Paraguay
successfully extradited Brazilian traffickers Odacir Antonio
Dametto, Mario Alberto Parra Espindola, and Carlos Alberto da
Silva Duro, who are wanted in Brazil on drug charges.


2. Money Laundering and Financial Crime

Prosecutors filed two new charges against Hatem Barakat, a
brother of money launderer and suspected terrorist financier
Assad Barakat, who in 2003 was convicted of tax evasion and
sentenced to six years in prison. The new charges against
Hatem involve the falsification of his children's birthplace
for purposes of obtaining Paraguayan citizenship.
Ironically, these seemingly less serious charges carry a
greater maximum penalty than the tax evasion charges,
subjecting Hatem to the possibility of eight years in prison
if convicted.



15. Training

This quarter INL funded an Oracle software training course
for analysts working for the Anti-Money Laundering
Secretariat (SEPRELAD).

SIPDIS



16. Miscellaneous Issues

Quarterly SENAD statistics

1st 2nd 3rd 4th


Cocaine 105.9 kg 12.39 kg
Seized (kg)

Marijuana
Seized (kg) 25,601 kg 26,737 kg

Marijuana
Crops 761 hectares 219 hectares
Destroyed

Arrests 17 45
(total)

- Cocaine 10 11


- Marijuana
(cultivation) 0 1


- Marijuana 6 32


- Counterfeit
Currency 0 0


- Int'l Trafficking
Firearms 1 0


- Trafficking
Narcotics 0 1


- Illegal Entry 0 0


- Money Laundering 0 0


- Result of
Investigation 0 0
KEANE