Terrorist links in Paraguay a local concern

News Article

By:  Pete King
Date: Jan. 2, 2008
Location: Unknown


Terrorist links in Paraguay a local concern

BY ANTHONY M. DESTEFANO

Ralph Nieves, a wiry ex-city narcotics detective, lived through the aftermath of Sept. 11, 2001, in Manhattan. That is why what he discovered about a particular part of Paraguay where his expertise was used during a recent assignment has so disturbed him.

Working under a U.S. government contract to carry out polygraph examinations of public officials in the country, Nieves said he discovered evidence of corruption among some police and military units.

It is a situation other law enforcement officials believe has contributed to parts of Paraguay being a terrorist haven where Hezbollah and allied groups have operated for years.

As a result, Paraguay's borders with Brazil and Argentina - an area called the "tri-border" - are being increasingly viewed by investigators, as well as American diplomats, as a vulnerable spot for the United States. Ciudad del Este, Paraguay's second-largest city, is suspected of being a financial hub for terror and organized crime groups. Some American investigators also believe the area's porous borders make it an ideal springboard for terrorists to make their way to the United States through Mexico and the Caribbean by using a variety of smuggling venues.

"Every major criminal organization in the world has a criminal representation in Ciudad del Este," Nieves, 63, said in a recent interview.

The lawlessness of the region makes it a threat for future terrorist financing and action in New York, Nieves said. He isn't alone in his concerns.

"It is being watched," Rep. Peter King (R-Seaford), the ranking Republican on the House Homeland Security Committee, told Newsday recently when asked about the tri-border zone.

In fact, Washington has been pouring millions into Paraguay to try to strengthen its legal institutions, which is why Nieves, who is a private investigator in the Bronx, was working there.

Hezbollah, an umbrella organization for Shia Muslims that started in Lebanon, is believed to have laundered $10 million annually through the area, King said.

Moving cash a concern

Martin Ficke, former head of Immigration and Customs Enforcement in New York and now director of operations for the Jericho-based investigative firm SES Resources Ltd., said the tri-border is a continuing concern for money laundering. Ficke, who worked with the El Dorado, the federal money laundering task force, said agents were looking to see how readily terrorists could rely on narcotics networks in Paraguay to move cash to support terror operations. He wouldn't comment further.

The U.S. Department of State says southern Paraguay has yet to sustain an "operational" presence for al-Qaida, Hezbollah or Hamas. King also doesn't believe al-Qaida is present in the area. But there are documented cases where members and sympathizers of Hamas, a militant Palestinian organization, and Hezbollah have engaged in money laundering, extortion, bombings and other crimes inside Ciudad del Este and surrounding areas. Back in the 1990s, suspects in the bombings of South America's Jewish communities were traced to the area and arrested.

Some U.S. officials also believe an al-Qaida ally, a shadowy terrorist group known as Lashkar-e-Taiba, which became active in Kashmir in Pakistan in the 1990s, is now operating in the region. Earlier this year, a Manhattan federal judge sentenced a Baltimore man to 15 years in prison for traveling to Pakistan for terrorism training at one of the group's camps.

A report prepared by the U.S. Embassy in Paraguay in April said the country doesn't have effective ways to deal with money laundering and terrorist financing but does try to cooperate in counterterrorism efforts. Judicial and police corruption were concerns, the report said.

In May, MSNBC ran a brief interview by correspondent Pablo Gato with a young Arab Muslim sympathizer of Hezbollah in Ciudad del Este who threatened an attack on the United States if Iran was targeted.

"In two minutes, Bush is dead," the man told MSNBC of the threatened consequences of a U.S attack.

Nieves' assignment in Paraguay was to take polygraph exams of nearly 80 cops, customs officials and military officers. They were applicants for positions in a special customs task force aimed at improving border controls in Paraguay that was to be funded by U.S. aid dollars.

Inside information

According to Nieves, one of a few U.S.-based Spanish language polygraphers active in the business, the applicants easily opened up to him. After Nieves assured them that admissions of participating in routine graft - known locally as "la coima" - wouldn't get them in trouble, the applicants said they believed criminals were tipped off to investigations by law enforcement officials. In some cases, local prosecutors warned smugglers of raids so they could dispose of contraband, Nieves said.

One customs officer said that some higher-ranked customs officials knew all of the organized crime leaders and provided them with information. Some national police also took part in executions on the border with Brazil near the town of Pedro Juan Caballero, said the official, adding that the killings involved disputes over smuggled goods.

The applicants painted a picture of a wild west atmosphere where legitimate law enforcement was intimidated by criminals and corrupt higher officials.

One U.S. law enforcement consultant who didn't want to be identified because he does a lot of business in Paraguay said the country's customs service is prone to corruption because of the low wages officials are paid. But even higher pay won't bring speedy reform, he said.

"They don't look at it as corruption. It is part of the culture," he said. "Everybody takes a piece of the government income."

"Most of those people who were coming forward were decent people. Unfortunately, the circumstances are overwhelming for them," Nieves said about the corruption.

Nieves thinks the United States could benefit by developing its own network of paid informants within Paraguay's customs and border police as an early warning system against terrorism.

"Everyone I met were people we could flip," he said.