ORGANIZED CRIME MAY FUEL TERROR (DAILYNEWS)
Operating from a Glendale office, Global Human Services shipped everything from milk and salad dressing to medicine and clothing in a humanitarian effort designed to help the needy in Eastern Europe.
But the organization was also a front, authorities say, for an international fraud and car-theft ring that stashed at least $5million in stolen luxury vehicles into the same shipping containers with the relief supplies.
The organization was broken up a year ago, with 17 people arrested on suspicion of grand theft and insurance fraud. Authorities said at the time they thought the group had ties to organized crime.
Now, police say the group also was funneling money to Chechen terrorists – the same group that raided a school in Russia three years ago and killed 331 innocent men, women and children.
“The concern was they were using some of the proceeds to support terrorist activities elsewhere,” Los Angeles Police Chief William Bratton said in a recent interview. “We had an organized gang creating crime and havoc here, but some of the proceeds were stirring up revolution elsewhere.”
Officials interviewed by the Daily News during an 18-month investigation of Eurasian crime syndicates say the case highlights a growing global convergence of organized crime and terrorist groups. And in recent months, concern has grown that crime syndicates are defrauding billions of dollars from U.S. government programs and funneling the money to terrorist groups overseas.
“We are very concerned where the money goes when it leaves the country,” said Robert A. Schoch, special-agent-in-charge of U.S. Immigration & Customs Enforcement in Southern California. “That’s why we look at this as a national security vulnerability.
“What is the money used for? Could it wind up in the hands of some radical terrorist organization looking to try to find some type of weapon of mass destruction?
“That’s very much a concern of ICE, the Department of Homeland Security and other federal agencies.”
Sally Thomas, head deputy in the District Attorney’s Organized Crime Division, has prosecuted these types of cases since the 1980s.
“I think everybody has concerns about money that is derived from criminal activities being used to support terrorism,” Thomas said. “Our concern is that money would be sent to a terrorist group who would use it to harm people in the United States or elsewhere in the world.”
Recent reports by the state Attorney General’s Office said al-Qaida, Hamas and Hezbollah are among the groups seeking to raise money in California.
“When you find these fraudulent activities that generate a significant amount of money – and they are connected to people who are allegedly involved in terrorist activities – it’s kind of like connect the dots,” said Marcia Daniel, the deputy district attorney in the Organized Crime Division who is prosecuting the Global Human Services case.
Two years ago, members of a suspected Russian and Armenian organized crime ring – including six from the San Fernando Valley – were charged with plotting to smuggle $2.5million in black-market weapons into the United States.
They were nabbed when they tried to sell rocket-propelled grenade launchers and shoulder- fired missiles to an FBI informant posing as an arms trafficker selling weapons to al-Qaida, authorities said. The trial is set to begin June4 in New York City.
“The concern in the law enforcement and intelligence community worldwide is that organized crime groups have the ability to operate in a wide range of countries, across borders and conduct transnational operations providing terrorist groups with the reach and ability to penetrate areas they wouldn’t be able to otherwise,” sheriff’s Lt. John Sullivan said at the National Terrorism Early Warning Resource Center.
“Organized crime provides links to traffic weapons, personnel and materials across borders and could facilitate terrorist operations.”
The case of Global Human Services is typical of the growing links between the two groups, LAPD Detective Mark Severino said.
After Chechen terrorists raided a Russian school in 2004, former LAPD Deputy Chief John Miller asked detectives to investigate whether any Chechen organized crime members were operating in Los Angeles.
“An informer had told us the Chechen `godfather’ was still here,” Severino said. “We started to look at him, and the investigation quickly revealed that there was some possible Medi-Cal fraud. And while looking at that, Global Human Services came to our attention.”
Severino said Ali Karabachev was known as the Chechen “godfather” and had worked for the group.
“Given the information we had that these Chechens were sending stolen cars overseas and the links of GHS with the Chechen godfather – and on the other end was an associate with Chechen organized crime – the FBI told us there is a fine line between Chechen organized crime and terrorism,” Severino said.
Chechen authorities have since arrested Karabachev on unrelated charges, and the Los Angeles Police Department is seeking to interview him, Severino said.
Eleven people have pleaded guilty to insurance fraud in the case, and some have been sentenced to probation and ordered to perform community service, Daniel said. Six others pleaded not guilty and are awaiting trial.
Earlier this year, Yakoob Habib, a 58-year-old tax preparer from Buena Park, was sentenced to 11 years in prison for his role in an international money-laundering operation that involved $28million in unreported income.
The source of the money included money stolen from Medi-Cal using fraudulent labs that billed for blood work that wasn’t done or authorized, officials said.
The Attorney General’s Office identified more than $12million that Habib illegally transferred to the United Arab Emirates, Pakistan, Russia and Latvia.
During a search of Habib’s business, investigators discovered pictures of anti-aircraft weaponry, the World Trade Center, Los Angeles International Airport and Department of Motor Vehicles logos, Deputy Attorney General Hardy Gold said.
“He had also downloaded a Web site with offensive anti-American banter on it,” Gold said.
“Did we trace any funds to the hands of terrorists? No. … On the other hand, he was a very effective money launderer who was able to erase the money trail. And the money transfer network he operated was for the benefit of organized crime.”
Terrorism experts say such connections are particularly worrisome because of some countries’ lax security for highly enriched uranium and other potentially dangerous materials.
Melinda Redman, senior director of intelligence and analysis at the Virginia-based Terrorism Research Center, said government officials are concerned about organized crime groups selling highly enriched uranium, plutonium or even nuclear devices to terrorists.
Former Russian Security Council Secretary Alexander Lebed claimed a decade ago that as many as 100 small nuclear devices had disappeared from Russian stockpiles. Officials have denied the claims, but experts still are worried.
“We have no idea what happened to (the nuclear devices),” said Michael Intriligator, a terrorism expert and professor at the University of California, Los Angeles. “And it’s something that could be smuggled as easily as a bail of marijuana across the Mexican border. And Los Angeles is a prime target.”
In a recent report, the International Atomic Energy Agency noted 540 confirmed cases of illicit trafficking in nuclear and other radioactive materials from the early 1990s to 2004.
“It’s very real and a very great concern,” said Graham Allison, founding dean of Harvard University’s John F. Kennedy School of Government and director of the Belfer Center for Science and International Affairs. “The U.S. and Russia have a cooperative program to recover highly enriched uranium.
“That’s good. But the pace at which it’s happening is still way too slow. And the notion that any material which people could use to make a nuclear bomb is not locked up to the highest level of security is nuts.”
Cristina-Astrid Hansell Cheun, a senior research associate at the Center for Nonproliferation Studies in Monterey, said organized crime groups in Russia have been involved in the theft of highly enriched uranium and other nuclear materials in the past.
“It’s frightening if the terrorist groups get connected with the organized crime groups that have these materials,” she said.
In a recent report on nuclear smuggling by the Center for Strategic & International Studies, authors wrote of an increasing threat that terrorist groups aided by organized crime in Russia and Central Asia will steal nuclear materials.
“Clearly, the capacity for criminal groups and terrorists to work together is growing,” wrote American University professors Robert Orttung and Louise Shelley.
“As the threat of nuclear smuggling increases and Russia’s ability to deal with the problem decreases, Russia and the United States need to work together to develop a serious analysis.”
Next month, officials from around the world are scheduled to meet in Florida to develop strategies to combat the threat of nuclear terrorism.
Schoch said ICE has investigated numerous reports in recent years regarding terrorists, gangs and others attempting to smuggle nuclear weapons and other dangerous materials into the United States.
“We take it very seriously, but typically when we look into them we are not able to corroborate any type of real connection,” Schoch said.
“But regardless, if you look at some of these gangs and some of the things they are venturing into, like human trafficking and narcotics, all of those are vulnerabilities.”