Treasury Notes

 Combating Transnational Organized Crime

By: David Cohen

Yesterday, the Treasury Department announced its first designations pursuant to Executive Order 13581, a key component of the President’s Strategy to Combat Transnational Organized Crime – a broad-based initiative announced last July to tackle this increasingly serious threat to American economic and security interests worldwide. E.O. 13581, the Transnational Organized Crime (TCO) E.O., takes aim at transnational criminal organizations by imposing economic sanctions against four key transnational criminal organizations – the Brothers’ Circle, the Yakuza, the Camorra and Los Zetas – and authorizes the Treasury Department to impose additional sanctions on their members and supporters.

Yesterday’s action imposes sanctions on specific key members and associates supporting two of these organizations – the Brothers’ Circle and the Yakuza – attacking their economic power, and protecting the integrity of international markets and the U.S. financial system from TCO penetration and abuse.

Among yesterday’s designations are seven individuals associated with the Brothers’ Circle, a criminal organization composed of leaders and senior members of several Eurasian criminal groups largely based in countries of the former Soviet Union but operating in Europe, the Middle East, Africa, and Latin America. The Brothers’ Circle serves as a coordinating body for several criminal networks, mediating disputes between the individual criminal networks and directing member criminal activity globally. Several of the members of the Brothers’ Circle designated today are based in Dubai, further evidence of their attempts to export their criminal activities on an international scale.

We have also designated the Yamaguchi-gumi, the largest and most prominent of the Yakuza’s crime families, as well as its two most senior leaders. The Yakuza was listed in the Annex to E.O. 13581 for its involvement in serious criminal activities, including weapons trafficking, prostitution, human trafficking, drug trafficking, fraud, and money laundering. The Yamaguchi-gumi is estimated to generate billions of dollars in illicit proceeds from criminal endeavors in Japan and abroad, including drug trafficking, human trafficking, extortion, prostitution, fraud, and money laundering.

These designations are intended to protect the U.S. and international financial systems from the activities of these groups and to disrupt their criminal infrastructure. Yesterday’s action freezes any assets the designated persons may have within U.S. jurisdiction, and generally prohibits U.S. persons from conducting any transactions with them, effectively isolating the designated persons from the U.S. financial system.

The increasingly globalized structure of these and other TCOs require that Treasury pursue the activities of TCOs wherever they occur. Our actions should serve as a warning to criminals seeking to take advantage of the global financial system for illicit gain. Treasury will continue to identify and expose TCOs and their criminal activity, and E.O. 13581 provides a powerful new tool for doing so.

David Cohen is Under Secretary of the Treasury for Terrorism and Financial Intelligence

Posted in:  Financial Sanctions; Terrorism and Illicit Finance
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