Volume I: Drug and Chemical Control
http://www.state.gov/p/inl/rls/nrcrpt/2008/vol1/html/100778.htm
I. Summary
Haiti is a major transit country for cocaine and marijuana from South America and the Caribbean respectively. In 2007, air smuggling of narcotics to Haiti from Venezuela increased by 38 percent. The Preval Administration continued the struggle to overcome pervasive corruption, weak governance and mismanagement. Haiti's law enforcement institutions are weak and its judicial system dysfunctional. With the support of the United Nations Stabilization Mission in Haiti (MINUSTAH), the Haitian National Police (HNP) conducted a successful campaign in the Port-au-Prince area to disrupt gang elements involved in kidnapping, drug trafficking, and intimidation. Although the campaign decreased criminal activity in those areas, the Government of Haiti (GOH) has yet to deliver the sustained police presence needed to curb the gangs' criminal activity. The GOH with assistance from international donors – principally MINUSTAH, the United States and Canada – continues to promote the restoration of the rule of law. The HNP, with the support of MINUSTAH, completed the first year of its reform plan, which includes a vetting and certification process for all officers, and reform of institutional elements including the General Administration Department and Logistics Bureau. The HNP's counternarcotics unit carried out operations during the year that resulted in limited seizures of drugs. Haiti is a party to the 1988 UN Drug Convention.
II. Status of Country
Haiti is a major drug transit country. Haiti's 1,125 miles of unprotected shoreline, uncontrolled seaports, numerous clandestine airstrips, along with a struggling police force, dysfunctional judiciary system, corruption, and weak democracy make it an attractive strategic point for drug traffickers. Cocaine and, to a lesser extent, marijuana are trafficked through Haiti to the United States and, in smaller quantities, to Canada and Europe. In addition to being shipped directly to the United States, drugs brought into Haiti also are moved overland into the Dominican Republic for onward delivery to the U.S. and Europe. Following a 167 percent spike in suspected drug smuggling flights from Venezuela to Hispaniola in 2006, flights decreased temporarily, primarily as a result of the joint DEA-HNP Operation Rum Punch. Launched in March, Rum Punch involved the deployment of USG air assets to Haiti teamed with maritime assets operating south of Hispaniola for three months. However, following that operation, the flights resumed and Haiti experienced a 38 percent increase in drug smuggling flights in 2007, as reported by the U.S. Joint Interagency Task Force–South (JIATF-S).
III. Country Actions Against Drugs in 2007
During 2007, the HNP trained 901 new recruits (782 men and 119 women), and 243 existing officers. In November, the HNP graduated a class of 646 new officers, including 86 women. The new officers are assigned to the Motorized Intervention Brigade (BIM) with primary duties to introduce community policing and to patrol the slum areas of the capital. The Academy training now consists of 24 weeks of basic police tactics, less-than-lethal tactics, community policing, weapons training, search and evidence gathering techniques, ethics, human rights, and gender and children's issues. In 2006, the HNP and MINUSTAH agreed upon a reform plan to create a police force of 14,000 trained and vetted officers within five years. The report on the first year of the plan's implementation released in September revealed progress on training of both new and experienced officers, development of standard operating procedures, continued emphasis of vetting, and improved capacity in criminal investigative techniques among specialized units. Since January, MINUSTAH military troops, United Nations Police (UNPOL), MINUSTAH Formed Police Units, and HNP officers have made progress in dismantling gangs that support drug trafficking and kidnapping.
In November, the GOH formally approved the terms of reference and work plan for a USG-funded project to enhance the effectiveness of GOH anti-money laundering and anti-corruption efforts. The project will provide mentoring on the investigation and prosecution of financial crimes by U.S. Treasury advisers and will involve the restructuring the GOH Central Financial Intelligence Unit (French acronym UCREF) by separating its investigative and intelligence gathering functions.
In April 2007, the Center for Information and Joint Coordination (French acronym CICC), under the Ministry of Interior, became fully operational. The Center is tasked with conducting investigations, research, data collection, information sharing and international and regional coordination related to drug trafficking in/through Haiti. It has 26 staff personnel assigned, including 16 investigators. It has established the Anti-Drug Task Force consisting of all the agencies within the GOH that deal with aspects of drug trafficking, money laundering, border control and law enforcement. It is also working to establish greater bilateral cooperation with the Dominican Republic, signing a joint agreement in November to fight drug trafficking and other crimes.
Law Enforcement Efforts. The HNP counternarcotics unit (French acronym BLTS) with support from the USG, continued canine detection operations at the airport inspection baggage and cargo areas in 2007. DEA-provided air assets working with JIATF-S air and maritime assets assisted the GOH in stopping air deliveries to Haiti. Through October 10, 2007, 914 kilos of cocaine and marijuana were seized.
The Special Investigative Unit (SIU), a partnership between DEA and the GOH, became operational in 2007. Selected HNP officers, graduates of a five-week course at the Drug Enforcement Academy in Quantico, Virginia, formed the nucleus of the SIU and are charged with investigating Haitian drug organizations that have a nexus to the United States. The unit has conducted several joint interdiction operations with DEA/FBI/JIATF-S and Customs Border Protection (CBP). The SIU is currently the only fully vetted unit in the HNP.
The HCG conducted drug and migrant interdiction operations from its bases in Port-au-Prince and Cap Haitien during the year. The HCG has one 40-foot vessel and one 35-foot go-fast boat in Cap Haitien for patrol and port security operations. In FY07, the HCG successfully interdicted more than one thousand Haitian migrants aboard vessels that departed the north coast. The HCG in Cap Haitien provided information on three vessels that contained illegal drugs or tested positive in ion-scanning by the U.S. Coast Guard (USCG). Additionally, the HCG in Port-au-Prince partnered with the HNP BLTS to board a Colombian-flagged freighter aground near Miragoane on Haiti's South Claw. However, the HCG struggles maintain an operational fleet. The lack of funding and fuel shortages remain significant barriers to the ability of the HCG to conduct maritime operations.
Corruption. As a matter of policy, the GOH does not encourage or facilitate the shipment of narcotics through Haiti, and does not discourage the investigation or prosecution of such acts. Moreover, the GOH has demonstrated willingness to undertake law enforcement and legal measures to prevent, investigate, prosecute, and punish public corruption. President Preval has publicly identified the fights against corruption and drug trafficking as major priorities for his administration. Vetting has taken place in some of the northern and southern areas and among certain ranks in Port-au-Prince and will be further expanded in the capital area, where the majority of police officers are assigned. In 2007, the HNP Director General dismissed 600 officers for misconduct or being absent without leave, although many remain on the payroll. The HNP Director of Administration and Director of Logistics were both removed from their positions in 2007 for suspected corruption. The Prosecutor of Port-au-Prince has made several high-profile arrests of private citizens on corruption charges, but has not yet extended that campaign to the public sector.
Agreements and Treaties. Haiti is a party to the 1961 Single Convention as amended by the 1972 Protocol; the 1988 UN Drug Convention; the Inter-American Convention Against Corruption; and the Inter American Convention against Trafficking in illegal firearms. A U.S.-Haiti maritime counternarcotics agreement entered into force in 2002. Haiti has signed but not ratified the UN Convention against Corruption, the Caribbean Regional Maritime Agreement and the UN Convention against Transnational Organized Crime). There is no bilateral mutual legal assistance treaty between the U.S. and Haiti. Requests for assistance historically have been made through letters rogatory but there have been no formal requests for assistance in years.
Extradition. Haiti and the U.S. are parties to an extradition treaty that entered into force in 1905. Although the Haitian Constitution prohibits the extradition of its nationals, in the past Haitians under indictment in the U.S. have been returned to the U.S. by non-extradition means. The SIU has spearheaded efforts to transfer both Haitian and non-Haitian nationals wanted in the United States for drug trafficking to the U.S., in keeping with President Preval's desire to stem drug trafficking through Haiti. During 2007, nine Haitian fugitives were sent to the U.S., including ex-HNP officer Raynald Saint-Pierre, wanted out of the Southern District of Florida on drugs and money laundering charges
Cultivation/Production. There is evidence that cultivation of marijuana has increased, although it is low quality cannabis grown on a small scale and sold locally. The BLTS destroyed five hectares of marijuana but, due to lack of resources, is often unable to respond to tips about marijuana growing fields.
Drug flow/transit. In 2007, traffickers continued to use small aircraft to make offshore air drops of illegal drugs as well as land deliveries using clandestine airstrips. At least 29 such landing strips were identified in 2007. Suspect drug flights from Venezuela increased by 38 percent compared to 2006. Fast boats transporting cocaine from South America arrive at a number of locations on the southern coast of Haiti. The cocaine is then transported overland to Port-au-Prince where it is frequently concealed on cargo and coastal freighters destined for the United States and Europe. Marijuana is shipped via fast boats from Jamaica to waiting Haitian fishing vessels and cargo freighters to seaports along Haiti's southern claw. It is then shipped directly to the continental United States or transshipped through the Dominican Republic or Puerto Rico. Seizures of very small quantities of crack for personal use also occurred in 2007. The BLTS also experienced an increase in amphetamine trafficking near the end of 2007, due to a crackdown in the Dominican Republic that has disrupted the distribution routes to Europe. The appearance of crack and the smuggling of amphetamines are new phenomena in Haiti for which the authorities have little training or experience. Pharmacies in Haiti are essentially unregulated, and some controlled medications are sold in quantities through those businesses as well.
Demand Reduction. Drug abuse is a growing but largely unrecognized problem in Haiti. Increased use of marijuana in schools has been reported, leading to increased levels of local production.
IV. U.S. Policy Initiatives and Programs
Policy Initiatives. The cornerstone of USG efforts to combat drug trafficking in Haiti continues to focus on reform of the HNP. In cooperation with MINUSTAH, the USG provided substantial equipment and technical assistance in 2007, aimed at transforming the HNP into an effective law enforcement institution. The NAS coordinated the procurement of vehicles, radios, forensic lab and other technical equipment for the HNP, police academy and in-service training, support for specialized HNP units and material support to the HCG. The USG contributed 50 officers to MINUSTAH's UNPOL contingent, many of whom are involved in training recruits at the HNP academy. The police advisers also oversaw the construction of two model police stations in Croix des Bouquets and Thiotte and the continued installation of solar-powered radio base stations for the HNP throughout the country. The USG also is contributing three corrections experts to form the nucleus of a sixteen-member UN team that works on improving the infrastructure and management of Haiti's prison system. A U.S. senior corrections advisor will also oversee the refurbishment and equipping of certain prison facilities as well as the training of correction personnel to improve the detainees living conditions. In addition, the USG has provided an adviser to help the HNP Director General implement anti-corruption and strategic planning measures. Advisers from U.S. Treasury's Office of Technical Assistance (OTA) visited Haiti three times in 2007, in order to review cases of financial crimes with prosecutors and judges and to discuss the investigative process and training requirements for financial investigators. USCG Mobile Training Teams supported HCG operations with maritime law enforcement, port security, engineering, logistics and maintenance training in 2007. The USCG is currently retrofitting three vessels, a 47-foot patrol boat and two "Eduardono" fast boats at USCG Integrated Support Command Miami. It is USCG's hope that HCG will place the 47-foot patrol boat in Cap Haitien for future drug and migrant operations on the northern coast of Haiti.
Road Ahead. Haiti needs to continue the reform and expansion of the HNP and its judicial system as prerequisites for effective counternarcotics operations throughout the country. The GOH must demonstrate the political will to fight corruption within state institutions and to overcome the under-resourcing and under-staffing of the HNP, problems which remain major impediments to sustained progress. More importantly, the restoration of the rule of law, including reform of the judicial system, must continue in order to provide the security and stability Haiti needs to meet the economic, social and political development needs of the Haitian people.
Volume II: Money Laundering and Financial Crimes
http://www.state.gov/p/inl/rls/nrcrpt/2008/vol2/html/100808.htm
Haiti is not a major financial center. Haiti's dire economic condition and unstable political situation inhibit the country from advancing its formal financial sector. Nevertheless, Haiti is a major drug-transit country with money laundering activity linked to the drug trade. Money laundering and other financial crimes are facilitated through the banks and casinos, and through foreign currency transactions and real estate transactions. While the informal economy in Haiti is significant and partly funded by illicit narcotics proceeds, smuggling is historically prevalent and predates narcotics trafficking.
Flights to Panama City, Panama, remain the main identifiable mode of transportation for money couriers. Suspected drug flights from Venezuela continue, where a permissive environment allows smuggling aircraft to operate with impunity. Travelers, predominantly Haitian citizens, usually hide large sums ranging from
U.S. $30,000 to $100,000 on their persons. There is low confidence in the efforts of Haitian customs and narcotics personnel to interdict these outbound funds. Suspicions that clandestine fees are collected to facilitate the couriers continuing without arrest appear to be well-founded. In addition, those persons that are actually interdicted are frequently released by the courts and the funds are ordered to be returned.
During interviews, couriers usually declare that they intend to use the large amounts of U.S. currency to purchase clothing and other items to be sold upon their return to Haiti, a common practice in the informal economic sector. Cash that is routinely transported to Haiti from Haitians and their relatives in the United States in the form of remittances represented over 21.2 percent of Haiti's gross domestic product in 2006, according to the World Bank. The Inter-American Development Bank estimated the flow of remittances through official channels to Haiti at $1.65 billion in fiscal year 2006.
The Government of Haiti (GOH) has made progress in recent years to improve its legal framework, create and strengthen core public institutions, and enhance financial management processes and procedures. The constitutional government of President René Préval and Prime Minister Jacques Edouard Alexis continued the monetary, fiscal and foreign exchange policies initiated under the past Interim Government of Haiti with the assistance of the International Monetary Fund and the World Bank. Continued insecurity and a lack of personnel expertise, however, have reduced the impact of the Government's initiatives and hampered its ability to modernize its regulatory and legal framework.
Despite political instability, Haiti has taken steps to address its money laundering and financial crimes problems. President Preval has openly affirmed his commitment to fight corruption, drug trafficking, and money laundering. He is actively seeking technical assistance and cooperation with countries in the region to reinforce Haiti's institutional capacity to fight financial crime. In March 2007, the GOH participated in a Summit on Drug and Money Laundering in the Dominican Republic to identify synergies between countries in the region (Haiti, Dominican Republic, Jamaica and Colombia) to fight organized crime. Preparations are underway for a subsequent meeting to be held by the end of December 2007 in Cartagena, Colombia.
Since 2001, Haiti has used the Law on Money Laundering from Illicit Drug Trafficking and other Crimes and Punishable Offenses (AML Law) as its primary anti-money laundering legislation. Although the government has publicly committed to combat corruption, the court system is slow to move forward with pending cases. None of the investigations initiated under the interim government have led to any prosecutions, and the Financial Crimes Task Force (FCTF), which is charged with conducting financial investigations, is currently inoperative.
The AML Law criminalizes money laundering and establishes a wide range of financial institutions as obligated entities, including banks, money remitters, exchange houses, casinos, and real estate agents. Insurance companies, which are only nominally represented in Haiti, are not covered. The AML Law requires financial institutions to establish money laundering prevention programs and to verify the identity of customers who open accounts or conduct transactions that exceed 200,000 gourdes (approximately U.S. $5,550). It also requires exchange brokers and money remitters to compile information on the source of funds exceeding 200,000 gourdes or its equivalent in foreign currency. Microfinance institutions and credit unions, however, remain largely unregulated. A draft banking law, if passed by Parliament, will address this regulatory gap.
The AML Law contains provisions for the forfeiture and seizure of assets; however, the government cannot seize and declare the assets forfeited until there is a conviction. Although the AML Law provides grounds for seizure, it does not contain procedures to handle the management and proceeds of seized assets. This deficiency in the law reduces the government's authority and resources to prosecute cases. Out of U.S. $565,723 seized in 2007 at the airport in Port-au-Prince, courts ordered that U.S. $367,417 be returned to the owners.
Implementation of the AML Law is compromised by weak enforcement mechanisms, poor understanding of the law on the part of legal and judicial personnel and an overall weak judicial system. From 2001 to 2007, 475 persons were arrested in connection with drug trafficking and money laundering. Fifteen individuals were sent to the United States to face prosecution. The remaining 460 individuals have yet to be prosecuted in Haitian courts. An amendment to the AML Law to redress weaknesses in the current law is being drafted for consideration by Parliament.
In 2002, Haiti formed a National Committee to Fight Money Laundering (CNLBA) under the supervision of the Ministry of Justice and Public Safety. The CNLBA is in charge of promoting, coordinating, and recommending policies to prevent, detect, and suppress the laundering of assets obtained from the illicit trafficking of drugs and other serious offenses. Haiti's financial intelligence unit (FIU), established in 2003, is the Unité Centrale de Renseignements Financiers (UCREF), which falls under the supervision of the CNLBA. The UCREF's mandate is to receive and analyze reports submitted by financial institutions in accordance with the law. The UCREF has 42 employees, including 23 analysts. Institutions, including banks, credit unions exchange brokers, insurance companies, lawyers, accountants, and casinos, are required to report to the UCREF transactions involving funds that may be derived from a crime, as well as transactions that exceed 200,000 gourdes (U.S. $5,550). Failure to report such transactions is punishable by more than three years' imprisonment and a fine of 20 million gourdes (approximately U.S. $550,000). Banks are required to maintain records for at least five years and to present this information to judicial authorities and UCREF officials upon request. Bank secrecy or professional secrecy cannot be invoked as grounds for refusing information requests from these authorities.
In 2006, the UCREF assisted the
U.S. in at least three major investigations. UCREF also assisted the interim government in filing the first-ever civil lawsuit in a U.S. court for reparation of Haitian government funds diverted through U.S. banks and businesses. However, the lawsuit was dropped shortly after the new government took office. Despite recent achievements, the UCREF is still not fully functional, and the UCREF's analysts lack the experience and skills needed to independently analyze suspect financial activities, write adequate reports and expeditiously move cases to prosecutors. Due to the absence of an investigative institution tasked with conducting financial investigations in the justice system, the UCREF responded to fill the void. This has led to a perception of conflict of interest and has, in some high-profile cases, sparked controversy.
In November, in response to a request for assistance from President Preval, the U.S. Treasury and the GOH entered into an agreement to restructure UCREF into an administrative FIU, and to reconstitute the investigative functions of the FCTF into a new and separate Office of Financial and Economic Affairs (BAFE). The U.S. Treasury Department agreed to provide training and technical assistance to BAFE investigators as well as the UCREF analysts, prosecutors, and judges. The World Bank has also entered into an agreement with the GOH to assist with training. These steps were supported by President Préval, who has sent out a presidential mandate to his ministers to support these new efforts in combating money laundering and corruption. In addition, draft counter-terrorist financing legislation has been submitted to the USG for review and comment.
Corruption is an ongoing challenge to economic growth. Haiti is ranked one of the most corrupt countries in the world according to Transparency International's Corruption Perception Index for 2007. The GOH has made incremental progress in enforcing public accountability and transparency, but substantive institutional reforms are still needed. In 2004, the government established the Specialized Unit to Combat Corruption (ULCC) in the Ministry of Economy and Finance. The ULCC is in the process of drafting a national strategy to combat corruption and has prepared a draft law for asset declaration by public sector employees and a code of ethics for the civil service. ULCC will submit the law to Parliament for consideration in the coming months.
Haiti has yet to pass legislation criminalizing the financing of terrorists and terrorism, and is not a party to the International Convention for the Suppression of the Financing of Terrorism. Haiti reportedly circulates the list of terrorists and terrorist organizations identified in UN Security Council Resolution 1267. The AML Law may provide sufficient grounds for freezing and seizing the assets of terrorists; however, given that there is currently no indication of the financing of terrorism in Haiti, this has not been tested.
Haiti is a party to the 1988 UN Drug Convention, and has signed, but not ratified, the UN Convention against Transnational Organized Crime, the UN Convention against Corruption, and the Inter-American Convention against Terrorism. Haiti is a member of the OAS/CICAD Experts Group to Control Money Laundering and the Caribbean Financial Action Task Force (CFATF). In September 2007, the World Bank conducted an assessment of the GOH that will also serve as a CFATF mutual evaluation; the report will be released in the spring of 2008. The UCREF is not a member of the Egmont Group of financial intelligence units. The UCREF has memoranda of understanding with the FIUs of the Dominican Republic, Panama, Guatemala and Honduras.
The GOH appears cognizant of deficiencies in its anti-money laundering and counter-terrorist financing regime through its efforts to improve its legal framework to combat, drug trafficking, money laundering, and corruption, and its action to reform the judicial process. President Preval has made these improvements a key element of his national agenda. Areas in need of improvement include an ineffective court system, weak enforcement mechanisms and poor knowledge of current laws governing this area. The GOH should move quickly to prosecute cases of corruption, drug trafficking and money laundering. This could send a positive message that financial crimes will be punished to the fullest extent of the law and also help garner broader public support for the rule of law. The GOH should also reinforce the capacity of the Haitian justice system to prosecute financial crimes. Initiatives to enhance the UCREF's capacity to meet the Egmont Group membership standards and provide timely and accurate reports on suspicious financial activities are also needed. The GOH should finalize its draft legislation on terrorist financing to criminalize the financing of terrorism and become a party to the International Convention for the Suppression of the Financing of Terrorism.
http://www.state.gov/p/inl/rls/nrcrpt/2008/vol1/html/100778.htm
I. Summary
Haiti is a major transit country for cocaine and marijuana from South America and the Caribbean respectively. In 2007, air smuggling of narcotics to Haiti from Venezuela increased by 38 percent. The Preval Administration continued the struggle to overcome pervasive corruption, weak governance and mismanagement. Haiti's law enforcement institutions are weak and its judicial system dysfunctional. With the support of the United Nations Stabilization Mission in Haiti (MINUSTAH), the Haitian National Police (HNP) conducted a successful campaign in the Port-au-Prince area to disrupt gang elements involved in kidnapping, drug trafficking, and intimidation. Although the campaign decreased criminal activity in those areas, the Government of Haiti (GOH) has yet to deliver the sustained police presence needed to curb the gangs' criminal activity. The GOH with assistance from international donors – principally MINUSTAH, the United States and Canada – continues to promote the restoration of the rule of law. The HNP, with the support of MINUSTAH, completed the first year of its reform plan, which includes a vetting and certification process for all officers, and reform of institutional elements including the General Administration Department and Logistics Bureau. The HNP's counternarcotics unit carried out operations during the year that resulted in limited seizures of drugs. Haiti is a party to the 1988 UN Drug Convention.
II. Status of Country
Haiti is a major drug transit country. Haiti's 1,125 miles of unprotected shoreline, uncontrolled seaports, numerous clandestine airstrips, along with a struggling police force, dysfunctional judiciary system, corruption, and weak democracy make it an attractive strategic point for drug traffickers. Cocaine and, to a lesser extent, marijuana are trafficked through Haiti to the United States and, in smaller quantities, to Canada and Europe. In addition to being shipped directly to the United States, drugs brought into Haiti also are moved overland into the Dominican Republic for onward delivery to the U.S. and Europe. Following a 167 percent spike in suspected drug smuggling flights from Venezuela to Hispaniola in 2006, flights decreased temporarily, primarily as a result of the joint DEA-HNP Operation Rum Punch. Launched in March, Rum Punch involved the deployment of USG air assets to Haiti teamed with maritime assets operating south of Hispaniola for three months. However, following that operation, the flights resumed and Haiti experienced a 38 percent increase in drug smuggling flights in 2007, as reported by the U.S. Joint Interagency Task Force–South (JIATF-S).
III. Country Actions Against Drugs in 2007
During 2007, the HNP trained 901 new recruits (782 men and 119 women), and 243 existing officers. In November, the HNP graduated a class of 646 new officers, including 86 women. The new officers are assigned to the Motorized Intervention Brigade (BIM) with primary duties to introduce community policing and to patrol the slum areas of the capital. The Academy training now consists of 24 weeks of basic police tactics, less-than-lethal tactics, community policing, weapons training, search and evidence gathering techniques, ethics, human rights, and gender and children's issues. In 2006, the HNP and MINUSTAH agreed upon a reform plan to create a police force of 14,000 trained and vetted officers within five years. The report on the first year of the plan's implementation released in September revealed progress on training of both new and experienced officers, development of standard operating procedures, continued emphasis of vetting, and improved capacity in criminal investigative techniques among specialized units. Since January, MINUSTAH military troops, United Nations Police (UNPOL), MINUSTAH Formed Police Units, and HNP officers have made progress in dismantling gangs that support drug trafficking and kidnapping.
In November, the GOH formally approved the terms of reference and work plan for a USG-funded project to enhance the effectiveness of GOH anti-money laundering and anti-corruption efforts. The project will provide mentoring on the investigation and prosecution of financial crimes by U.S. Treasury advisers and will involve the restructuring the GOH Central Financial Intelligence Unit (French acronym UCREF) by separating its investigative and intelligence gathering functions.
In April 2007, the Center for Information and Joint Coordination (French acronym CICC), under the Ministry of Interior, became fully operational. The Center is tasked with conducting investigations, research, data collection, information sharing and international and regional coordination related to drug trafficking in/through Haiti. It has 26 staff personnel assigned, including 16 investigators. It has established the Anti-Drug Task Force consisting of all the agencies within the GOH that deal with aspects of drug trafficking, money laundering, border control and law enforcement. It is also working to establish greater bilateral cooperation with the Dominican Republic, signing a joint agreement in November to fight drug trafficking and other crimes.
Law Enforcement Efforts. The HNP counternarcotics unit (French acronym BLTS) with support from the USG, continued canine detection operations at the airport inspection baggage and cargo areas in 2007. DEA-provided air assets working with JIATF-S air and maritime assets assisted the GOH in stopping air deliveries to Haiti. Through October 10, 2007, 914 kilos of cocaine and marijuana were seized.
The Special Investigative Unit (SIU), a partnership between DEA and the GOH, became operational in 2007. Selected HNP officers, graduates of a five-week course at the Drug Enforcement Academy in Quantico, Virginia, formed the nucleus of the SIU and are charged with investigating Haitian drug organizations that have a nexus to the United States. The unit has conducted several joint interdiction operations with DEA/FBI/JIATF-S and Customs Border Protection (CBP). The SIU is currently the only fully vetted unit in the HNP.
The HCG conducted drug and migrant interdiction operations from its bases in Port-au-Prince and Cap Haitien during the year. The HCG has one 40-foot vessel and one 35-foot go-fast boat in Cap Haitien for patrol and port security operations. In FY07, the HCG successfully interdicted more than one thousand Haitian migrants aboard vessels that departed the north coast. The HCG in Cap Haitien provided information on three vessels that contained illegal drugs or tested positive in ion-scanning by the U.S. Coast Guard (USCG). Additionally, the HCG in Port-au-Prince partnered with the HNP BLTS to board a Colombian-flagged freighter aground near Miragoane on Haiti's South Claw. However, the HCG struggles maintain an operational fleet. The lack of funding and fuel shortages remain significant barriers to the ability of the HCG to conduct maritime operations.
Corruption. As a matter of policy, the GOH does not encourage or facilitate the shipment of narcotics through Haiti, and does not discourage the investigation or prosecution of such acts. Moreover, the GOH has demonstrated willingness to undertake law enforcement and legal measures to prevent, investigate, prosecute, and punish public corruption. President Preval has publicly identified the fights against corruption and drug trafficking as major priorities for his administration. Vetting has taken place in some of the northern and southern areas and among certain ranks in Port-au-Prince and will be further expanded in the capital area, where the majority of police officers are assigned. In 2007, the HNP Director General dismissed 600 officers for misconduct or being absent without leave, although many remain on the payroll. The HNP Director of Administration and Director of Logistics were both removed from their positions in 2007 for suspected corruption. The Prosecutor of Port-au-Prince has made several high-profile arrests of private citizens on corruption charges, but has not yet extended that campaign to the public sector.
Agreements and Treaties. Haiti is a party to the 1961 Single Convention as amended by the 1972 Protocol; the 1988 UN Drug Convention; the Inter-American Convention Against Corruption; and the Inter American Convention against Trafficking in illegal firearms. A U.S.-Haiti maritime counternarcotics agreement entered into force in 2002. Haiti has signed but not ratified the UN Convention against Corruption, the Caribbean Regional Maritime Agreement and the UN Convention against Transnational Organized Crime). There is no bilateral mutual legal assistance treaty between the U.S. and Haiti. Requests for assistance historically have been made through letters rogatory but there have been no formal requests for assistance in years.
Extradition. Haiti and the U.S. are parties to an extradition treaty that entered into force in 1905. Although the Haitian Constitution prohibits the extradition of its nationals, in the past Haitians under indictment in the U.S. have been returned to the U.S. by non-extradition means. The SIU has spearheaded efforts to transfer both Haitian and non-Haitian nationals wanted in the United States for drug trafficking to the U.S., in keeping with President Preval's desire to stem drug trafficking through Haiti. During 2007, nine Haitian fugitives were sent to the U.S., including ex-HNP officer Raynald Saint-Pierre, wanted out of the Southern District of Florida on drugs and money laundering charges
Cultivation/Production. There is evidence that cultivation of marijuana has increased, although it is low quality cannabis grown on a small scale and sold locally. The BLTS destroyed five hectares of marijuana but, due to lack of resources, is often unable to respond to tips about marijuana growing fields.
Drug flow/transit. In 2007, traffickers continued to use small aircraft to make offshore air drops of illegal drugs as well as land deliveries using clandestine airstrips. At least 29 such landing strips were identified in 2007. Suspect drug flights from Venezuela increased by 38 percent compared to 2006. Fast boats transporting cocaine from South America arrive at a number of locations on the southern coast of Haiti. The cocaine is then transported overland to Port-au-Prince where it is frequently concealed on cargo and coastal freighters destined for the United States and Europe. Marijuana is shipped via fast boats from Jamaica to waiting Haitian fishing vessels and cargo freighters to seaports along Haiti's southern claw. It is then shipped directly to the continental United States or transshipped through the Dominican Republic or Puerto Rico. Seizures of very small quantities of crack for personal use also occurred in 2007. The BLTS also experienced an increase in amphetamine trafficking near the end of 2007, due to a crackdown in the Dominican Republic that has disrupted the distribution routes to Europe. The appearance of crack and the smuggling of amphetamines are new phenomena in Haiti for which the authorities have little training or experience. Pharmacies in Haiti are essentially unregulated, and some controlled medications are sold in quantities through those businesses as well.
Demand Reduction. Drug abuse is a growing but largely unrecognized problem in Haiti. Increased use of marijuana in schools has been reported, leading to increased levels of local production.
IV. U.S. Policy Initiatives and Programs
Policy Initiatives. The cornerstone of USG efforts to combat drug trafficking in Haiti continues to focus on reform of the HNP. In cooperation with MINUSTAH, the USG provided substantial equipment and technical assistance in 2007, aimed at transforming the HNP into an effective law enforcement institution. The NAS coordinated the procurement of vehicles, radios, forensic lab and other technical equipment for the HNP, police academy and in-service training, support for specialized HNP units and material support to the HCG. The USG contributed 50 officers to MINUSTAH's UNPOL contingent, many of whom are involved in training recruits at the HNP academy. The police advisers also oversaw the construction of two model police stations in Croix des Bouquets and Thiotte and the continued installation of solar-powered radio base stations for the HNP throughout the country. The USG also is contributing three corrections experts to form the nucleus of a sixteen-member UN team that works on improving the infrastructure and management of Haiti's prison system. A U.S. senior corrections advisor will also oversee the refurbishment and equipping of certain prison facilities as well as the training of correction personnel to improve the detainees living conditions. In addition, the USG has provided an adviser to help the HNP Director General implement anti-corruption and strategic planning measures. Advisers from U.S. Treasury's Office of Technical Assistance (OTA) visited Haiti three times in 2007, in order to review cases of financial crimes with prosecutors and judges and to discuss the investigative process and training requirements for financial investigators. USCG Mobile Training Teams supported HCG operations with maritime law enforcement, port security, engineering, logistics and maintenance training in 2007. The USCG is currently retrofitting three vessels, a 47-foot patrol boat and two "Eduardono" fast boats at USCG Integrated Support Command Miami. It is USCG's hope that HCG will place the 47-foot patrol boat in Cap Haitien for future drug and migrant operations on the northern coast of Haiti.
Road Ahead. Haiti needs to continue the reform and expansion of the HNP and its judicial system as prerequisites for effective counternarcotics operations throughout the country. The GOH must demonstrate the political will to fight corruption within state institutions and to overcome the under-resourcing and under-staffing of the HNP, problems which remain major impediments to sustained progress. More importantly, the restoration of the rule of law, including reform of the judicial system, must continue in order to provide the security and stability Haiti needs to meet the economic, social and political development needs of the Haitian people.
Volume II: Money Laundering and Financial Crimes
http://www.state.gov/p/inl/rls/nrcrpt/2008/vol2/html/100808.htm
Haiti is not a major financial center. Haiti's dire economic condition and unstable political situation inhibit the country from advancing its formal financial sector. Nevertheless, Haiti is a major drug-transit country with money laundering activity linked to the drug trade. Money laundering and other financial crimes are facilitated through the banks and casinos, and through foreign currency transactions and real estate transactions. While the informal economy in Haiti is significant and partly funded by illicit narcotics proceeds, smuggling is historically prevalent and predates narcotics trafficking.
Flights to Panama City, Panama, remain the main identifiable mode of transportation for money couriers. Suspected drug flights from Venezuela continue, where a permissive environment allows smuggling aircraft to operate with impunity. Travelers, predominantly Haitian citizens, usually hide large sums ranging from
U.S. $30,000 to $100,000 on their persons. There is low confidence in the efforts of Haitian customs and narcotics personnel to interdict these outbound funds. Suspicions that clandestine fees are collected to facilitate the couriers continuing without arrest appear to be well-founded. In addition, those persons that are actually interdicted are frequently released by the courts and the funds are ordered to be returned.
During interviews, couriers usually declare that they intend to use the large amounts of U.S. currency to purchase clothing and other items to be sold upon their return to Haiti, a common practice in the informal economic sector. Cash that is routinely transported to Haiti from Haitians and their relatives in the United States in the form of remittances represented over 21.2 percent of Haiti's gross domestic product in 2006, according to the World Bank. The Inter-American Development Bank estimated the flow of remittances through official channels to Haiti at $1.65 billion in fiscal year 2006.
The Government of Haiti (GOH) has made progress in recent years to improve its legal framework, create and strengthen core public institutions, and enhance financial management processes and procedures. The constitutional government of President René Préval and Prime Minister Jacques Edouard Alexis continued the monetary, fiscal and foreign exchange policies initiated under the past Interim Government of Haiti with the assistance of the International Monetary Fund and the World Bank. Continued insecurity and a lack of personnel expertise, however, have reduced the impact of the Government's initiatives and hampered its ability to modernize its regulatory and legal framework.
Despite political instability, Haiti has taken steps to address its money laundering and financial crimes problems. President Preval has openly affirmed his commitment to fight corruption, drug trafficking, and money laundering. He is actively seeking technical assistance and cooperation with countries in the region to reinforce Haiti's institutional capacity to fight financial crime. In March 2007, the GOH participated in a Summit on Drug and Money Laundering in the Dominican Republic to identify synergies between countries in the region (Haiti, Dominican Republic, Jamaica and Colombia) to fight organized crime. Preparations are underway for a subsequent meeting to be held by the end of December 2007 in Cartagena, Colombia.
Since 2001, Haiti has used the Law on Money Laundering from Illicit Drug Trafficking and other Crimes and Punishable Offenses (AML Law) as its primary anti-money laundering legislation. Although the government has publicly committed to combat corruption, the court system is slow to move forward with pending cases. None of the investigations initiated under the interim government have led to any prosecutions, and the Financial Crimes Task Force (FCTF), which is charged with conducting financial investigations, is currently inoperative.
The AML Law criminalizes money laundering and establishes a wide range of financial institutions as obligated entities, including banks, money remitters, exchange houses, casinos, and real estate agents. Insurance companies, which are only nominally represented in Haiti, are not covered. The AML Law requires financial institutions to establish money laundering prevention programs and to verify the identity of customers who open accounts or conduct transactions that exceed 200,000 gourdes (approximately U.S. $5,550). It also requires exchange brokers and money remitters to compile information on the source of funds exceeding 200,000 gourdes or its equivalent in foreign currency. Microfinance institutions and credit unions, however, remain largely unregulated. A draft banking law, if passed by Parliament, will address this regulatory gap.
The AML Law contains provisions for the forfeiture and seizure of assets; however, the government cannot seize and declare the assets forfeited until there is a conviction. Although the AML Law provides grounds for seizure, it does not contain procedures to handle the management and proceeds of seized assets. This deficiency in the law reduces the government's authority and resources to prosecute cases. Out of U.S. $565,723 seized in 2007 at the airport in Port-au-Prince, courts ordered that U.S. $367,417 be returned to the owners.
Implementation of the AML Law is compromised by weak enforcement mechanisms, poor understanding of the law on the part of legal and judicial personnel and an overall weak judicial system. From 2001 to 2007, 475 persons were arrested in connection with drug trafficking and money laundering. Fifteen individuals were sent to the United States to face prosecution. The remaining 460 individuals have yet to be prosecuted in Haitian courts. An amendment to the AML Law to redress weaknesses in the current law is being drafted for consideration by Parliament.
In 2002, Haiti formed a National Committee to Fight Money Laundering (CNLBA) under the supervision of the Ministry of Justice and Public Safety. The CNLBA is in charge of promoting, coordinating, and recommending policies to prevent, detect, and suppress the laundering of assets obtained from the illicit trafficking of drugs and other serious offenses. Haiti's financial intelligence unit (FIU), established in 2003, is the Unité Centrale de Renseignements Financiers (UCREF), which falls under the supervision of the CNLBA. The UCREF's mandate is to receive and analyze reports submitted by financial institutions in accordance with the law. The UCREF has 42 employees, including 23 analysts. Institutions, including banks, credit unions exchange brokers, insurance companies, lawyers, accountants, and casinos, are required to report to the UCREF transactions involving funds that may be derived from a crime, as well as transactions that exceed 200,000 gourdes (U.S. $5,550). Failure to report such transactions is punishable by more than three years' imprisonment and a fine of 20 million gourdes (approximately U.S. $550,000). Banks are required to maintain records for at least five years and to present this information to judicial authorities and UCREF officials upon request. Bank secrecy or professional secrecy cannot be invoked as grounds for refusing information requests from these authorities.
In 2006, the UCREF assisted the
U.S. in at least three major investigations. UCREF also assisted the interim government in filing the first-ever civil lawsuit in a U.S. court for reparation of Haitian government funds diverted through U.S. banks and businesses. However, the lawsuit was dropped shortly after the new government took office. Despite recent achievements, the UCREF is still not fully functional, and the UCREF's analysts lack the experience and skills needed to independently analyze suspect financial activities, write adequate reports and expeditiously move cases to prosecutors. Due to the absence of an investigative institution tasked with conducting financial investigations in the justice system, the UCREF responded to fill the void. This has led to a perception of conflict of interest and has, in some high-profile cases, sparked controversy.
In November, in response to a request for assistance from President Preval, the U.S. Treasury and the GOH entered into an agreement to restructure UCREF into an administrative FIU, and to reconstitute the investigative functions of the FCTF into a new and separate Office of Financial and Economic Affairs (BAFE). The U.S. Treasury Department agreed to provide training and technical assistance to BAFE investigators as well as the UCREF analysts, prosecutors, and judges. The World Bank has also entered into an agreement with the GOH to assist with training. These steps were supported by President Préval, who has sent out a presidential mandate to his ministers to support these new efforts in combating money laundering and corruption. In addition, draft counter-terrorist financing legislation has been submitted to the USG for review and comment.
Corruption is an ongoing challenge to economic growth. Haiti is ranked one of the most corrupt countries in the world according to Transparency International's Corruption Perception Index for 2007. The GOH has made incremental progress in enforcing public accountability and transparency, but substantive institutional reforms are still needed. In 2004, the government established the Specialized Unit to Combat Corruption (ULCC) in the Ministry of Economy and Finance. The ULCC is in the process of drafting a national strategy to combat corruption and has prepared a draft law for asset declaration by public sector employees and a code of ethics for the civil service. ULCC will submit the law to Parliament for consideration in the coming months.
Haiti has yet to pass legislation criminalizing the financing of terrorists and terrorism, and is not a party to the International Convention for the Suppression of the Financing of Terrorism. Haiti reportedly circulates the list of terrorists and terrorist organizations identified in UN Security Council Resolution 1267. The AML Law may provide sufficient grounds for freezing and seizing the assets of terrorists; however, given that there is currently no indication of the financing of terrorism in Haiti, this has not been tested.
Haiti is a party to the 1988 UN Drug Convention, and has signed, but not ratified, the UN Convention against Transnational Organized Crime, the UN Convention against Corruption, and the Inter-American Convention against Terrorism. Haiti is a member of the OAS/CICAD Experts Group to Control Money Laundering and the Caribbean Financial Action Task Force (CFATF). In September 2007, the World Bank conducted an assessment of the GOH that will also serve as a CFATF mutual evaluation; the report will be released in the spring of 2008. The UCREF is not a member of the Egmont Group of financial intelligence units. The UCREF has memoranda of understanding with the FIUs of the Dominican Republic, Panama, Guatemala and Honduras.
The GOH appears cognizant of deficiencies in its anti-money laundering and counter-terrorist financing regime through its efforts to improve its legal framework to combat, drug trafficking, money laundering, and corruption, and its action to reform the judicial process. President Preval has made these improvements a key element of his national agenda. Areas in need of improvement include an ineffective court system, weak enforcement mechanisms and poor knowledge of current laws governing this area. The GOH should move quickly to prosecute cases of corruption, drug trafficking and money laundering. This could send a positive message that financial crimes will be punished to the fullest extent of the law and also help garner broader public support for the rule of law. The GOH should also reinforce the capacity of the Haitian justice system to prosecute financial crimes. Initiatives to enhance the UCREF's capacity to meet the Egmont Group membership standards and provide timely and accurate reports on suspicious financial activities are also needed. The GOH should finalize its draft legislation on terrorist financing to criminalize the financing of terrorism and become a party to the International Convention for the Suppression of the Financing of Terrorism.
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