FINANCED BY ORGANIZED CRIME
By Michel Chossudovsky
of Economics, University of Ottawa
Ottawa, CANADA K1N6N5
Voice box: 1-613-562-5800, ext. 1415
Wednesday, 7 April 1999
global media as a humanitarian peace-keeping mission, NATO"s
ruthless bombing of Belgrade and Pristina goes far beyond
the breach of international law. While Slobodan Milosevic
is demonized, portrayed as a remorseless dictator, the
Liberation Army (KLA) is upheld as a self-respecting nationalist
movement struggling for the rights of ethnic Albanians.
The truth of the matter is that the KLA is sustained by
organized crime with the tacit approval of the United States
and its allies.
set during the War in Bosnia, public opinion has been carefully
misled. The multibillion dollar Balkans narcotics trade
has played a crucial role in "financing the conflict" in
Kosovo in accordance with Western economic, strategic and
military objectives. Amply documented by European police
files, acknowledged by numerous studies, the links of the
Kosovo Liberation Army (KLA) to criminal syndicates in
Turkey and the European Union have been known to Western
governments and intelligence agencies since the mid-1990s.
of the Kosovo guerilla war poses critical questions and
it sorely test claims of an "ethical" foreign
policy. Should the West back a guerrilla army that appears
to partly financed by organized crime.1
While KLA leaders
were shaking hands with US Secretary of State Madeleine
Albright at Rambouillet, Europol (the European Police Organization
based in the Hague) was "preparing a report for European
interior and justice ministers on a connection between the
KLA and Albanian drug gangs."2 In the meantime, the
army has been skillfully heralded by the global media (in
the months preceding the NATO bombings) as broadly representative
of the interests of ethnic Albanians in Kosovo.
With KLA leader
Hashim Thaci (a 29 year "freedom fighter") appointed
chief negotiator at Rambouillet, the KLA has become the
de facto helmsman of the peace process on behalf of the
ethnic Albanian majority and this despite its links to
drug trade. The West was relying on its KLA puppets to
an agreement which would have transformed Kosovo into an
occupied territory under Western Administration.
Gelbard, America"s specialenvoy to Bosnia, had described
the KLA last year as "terrorists". Christopher Hill,
America"s chief negotiator and architect of the Rambouillet
agreement "has also been a strong critic of the KLA for
its alleged dealings in drugs."3 Moreover, barely
two months before Rambouillet, the US State Department
acknowledged (based on reports from the US Observer Mission)
the role of the KLA in terrorizing and uprooting ethnic
harass or kidnap anyone who comes to the police,
... KLA representatives had threatened to kill villagers
burn their homes if they did not join the KLA [a process
which has continued since the NATO bombings]... [The KLA
harassment has reached such intensity that residents of
villages in the Stimlje region are "ready to flee.4
a "freedom movement" with links to the drug trade,
seems also intent in bypassing the civilian Kosovo Democratic
League and its leader Ibrahim Rugova who has called for
an end to the bombings and expressed his desire to negotiate
a peaceful settlement with the Yugoslav authorities.5 It
is worth recalling that a few days before his March 31st
Press Conference, Rugova had been reported by the KLA (alongside
three other leaders including Fehmi Agani) to have been
killed by the Serbs.
OF "FREEDOM FIGHTERS"
North and the Contras? The pattern in Kosovo is similar
to other CIA covert operations in Central America, Haiti
and Afghanistan where "freedom fighters" were
the laundering of drug money. Since the onslaught of the
Cold War, Western intelligence agencies have developed
complex relationship to the illegal narcotics trade. In
case after case, drug money laundered in the international
banking system has financed covert operations.
to author Alfred McCoy, the pattern of covert financing
was established in the Indochina war. In the 1960s, the
Meo army in Laos was funded by the narcotics trade as part
of Washington"s military strategy against the combined
of the neutralist government of Prince Souvanna Phouma
the Pathet Lao.6
of drug politics set in Indochina has since been replicated
in Central America and the Caribbean. "The rising curve
of cocaine imports to the US", wrote journalist John Dinges
"followed almost exactly the flow of US arms and military
advisers to Central America."7
in Guatemala and Haiti, to which the CIA provided covert
support, were known to be involved in the trade of narcotics
into Southern Florida. And as revealed in the Iran-Contra
and Bank of Commerce and Credit International (BCCI) scandals,
there was strong evidence that covert operations were funded
through the laundering of drug money. "Dirty money" recycled
through the banking system—often through an anonymous shell
company—became "covert money," used to finance
groups and guerilla movements including the Nicaraguan
and the Afghan Mujahadeen. According to a 1991 Time Magazine
US wanted to supply the mujehadeen rebels in
Afghanistan with stinger missiles and other military
hardware it needed the full cooperation of Pakistan. By
mid-1980s, the CIA operation in Islamabad was one of the
largest US intelligence stations in the World. "If BCCI
such an embarrassment to the US that forthright
investigations are not being pursued it has a lot to do
the blind eye the US turned to the heroin trafficking in
Pakistan", said a US intelligence officer.8
GERMANY JOIN HANDS
Since the early
1990s, Bonn and Washington have joined hands in establishing
their respective spheres of influence in the Balkans. Their
intelligence agencies have also collaborated. According
to intelligence analyst John Whitley, covert support to
the Kosovo rebel army was established as a joint endeavour
between the CIA and Germany"s Bundes Nachrichten Dienst
(BND) (which previously played a key role in installing
a right wing nationalist government under Franjo Tudjman
in Croatia).9 The task to create and finance the KLA was
initially given to Germany: "They used German uniforms,
East German weapons and were financed, in part, with drug
money."10 According to Whitley, the CIA was, subsequently
instrumental in training and equipping the KLA in Albania.11
The covert activities
of Germany"s BND were consistent with Bonn"s intent to expand
its "Lebensraum" into the Balkans. Prior to the onset of
the civil war in Bosnia, Germany and its Foreign Minister
Hans Dietrich Genscher had actively supported secession;
it had "forced the pace of international diplomacy" and
pressured its Western allies to recognize Slovenia and Croatia.
According to the Geopolitical Drug Watch, both Germany and
the US favoured (although not officially) the formation
of a "Greater Albania" encompassing Albania, Kosovo and
parts of Macedonia.12 According to Sean Gervasi, Germany
was seeking a free hand among its allies "to pursue economic
dominance in the whole of Mitteleuropa."13
IN SUPPORT OF THE KLA
Washington"s "hidden agenda" consisted in triggering nationalist
liberation movements in Bosnia and Kosovo with the ultimate
purpose of destabilising Yugoslavia. The latter objective
was also carried out "by turning a blind eye" to
of mercenaries and financial support from Islamic fundamentalist
organisations.14 Mercenaries financed by Saudi Arabia and
Kuwait had been fighting in Bosnia.15 And the Bosnian pattern
was replicated in Kosovo: Mujahadeen mercenaries from various
Islamic countries are reported to be fighting alongside
the KLA in Kosovo. German, Turkish and Afghan instructors
were reported to be training the KLA in guerilla and diversion
to a Deutsche Press-Agentur report, financial support from
Islamic countries to the KLA had been channelled through
the former Albanian chief of the National Information Service
(NIS), Bashkim Gazidede.17 "Gazidede, reportedly a devout
Moslem who fled Albania in March of last year , is
presently  being investigated for his contacts with
Islamic terrorist organizations."18
The supply route
for arming KLA "freedom fighters" are the rugged mountainous
borders of Albania with Kosovo and Macedonia. Albania is
also a key point of transit of the Balkans drug route which
supplies Western Europe with grade four heroin. 75% of the
heroin entering Western Europe is from Turkey. And a large
part of drug shipments originating in Turkey transits through
the Balkans. According to the US Drug Enforcement Administration
(DEA), "it is estimated that 4-6 metric tons of heroin leave
each month from Turkey having [through the Balkans] as destination
Western Europe."19 A recent intelligence report by Germany"s
Federal Criminal Agency suggests that: "Ethnic Albanians
are now the most prominent group in the distribution of
heroin in Western consumer countries."20
OF DIRTY MONEY
In order to
the criminal syndicates involved in the Balkans narcotics
trade need friends in high places. Smuggling rings with
alleged links to the Turkish State are said to control
trafficking of heroin through the Balkans "cooperating closely
with other groups with which they have political or religious
ties" including criminal groups in Albanian and Kosovo.21
In this new global financial environment, powerful undercover
political lobbies connected to organized crime cultivate
links to prominent political figures and officials of the
military and intelligence establishment.
trade nonetheless uses respectable banks to launder large
amounts of dirty money. While comfortably removed from the
smuggling operations per se, powerful banking interests
in Turkey but mainly those in financial centres in Western
Europe discretely collect fat commissions in a multibillion
dollar money laundering operation. These interests have
high stakes in ensuring a safe passage of drug shipments
into Western European markets.
from Albania into Kosovo and Macedonia started at the beginning
of 1992, when the Democratic Party came to power, headed
by President Sali Berisha. An expansive underground economy
and cross border trade had unfolded. A triangular trade
in oil, arms and narcotics had developed largely as a result
of the embargo imposed by the international community on
Serbia and Montenegro and the blockade enforced by Greece
agriculture in Kosovo were spearheaded into bankruptcy
the IMF"s lethal "economic medicine" imposed on Belgrade
in 1990. The embargo was imposed on Yugoslavia. Ethnic
Albanians and Serbs were driven into abysmal poverty. Economic
collapse created an environment which fostered
the progress of illicit trade. In Kosovo, the rate of unemployment
increased to a staggering 70 percent (according to Western
economic collapse served to exacerbate simmering ethnic
tensions. Thousands of unemployed youths "barely out of
their Teens" from an impoverished population, were
into the ranks of the KLA.22
Albania,the free market reforms adopted since 1992 had created
conditions which favoured the criminalisation of State institutions.
Drug money was also laundered in the Albanian pyramids (ponzi
schemes) which mushroomed during the government of former
President Sali Berisha (1992-1997).23 These shady investment
funds were an integral part of the economic reforms inflicted
by Western creditors on Albania.
in Kosovo, Albania and Macedonia (with links to the Italian
mafia) had become the new economic elites, often associated
with Western business interests. In turn the financial
of the trade in drugs and arms were recycled towards other
illicit activities (and vice versa) including a vast prostitution
racket between Albania and Italy. Albanian criminal groups
operating in Milan, "have become so powerful running prostitution
rackets that they have even taken over the Calabrians in
strength and influence."24
of "strong economic medicine" under the guidance of the
Washington based Bretton Woods institutions had contributed
to wrecking Albania"s banking system and precipitating the
collapse of the Albanian economy. The resulting chaos enabled
American and European transnationals to carefully position
themselves. Several Western oil companies including Occidental,
Shell and British Petroleum had their eyes rivetted on Albania"s
abundant and unexplored oil-deposits. Western investors
were also gawking Albania"s extensive reserves of chrome,
copper, gold, nickel and platinum... The Adenauer Foundation
had been lobbying in the background on behalf of German
Minister of Defence Safet Zoulali (alleged to have been
involved in the illegal oil and narcotics trade) was the
architect of the agreement with Germany"s Preussag (handing
over control over Albania"s chrome mines) against the competing
bid of the US led consortium of Macalloy Inc. in association
with Rio Tinto Zimbabwe (RTZ).26
of narco-dollars had also been recycled into the privatisation
programmes leading to the acquisition of State assets by
the mafias. In Albania, the privatisation programme had
led virtually overnight to the development of a property
owning class firmly committed to the "free marke." In Northern
Albania, this class was associated with the Guegue "families" linked
to the Democratic Party.
the Democratic Party under the presidency of Sali Berisha
(1992-97), Albania"s largest financial "pyramid" VEFA Holdings
had been set up by the Guegue "families" of Northern
with the support of Western banking interests.
VEFA was under
investigation in Italy in 1997 for its ties to the Mafia
which allegedly used VEFA to launder large amounts of dirty
one press report (based on intelligence sources), senior
members of the Albanian government during the Presidency
of Sali Berisha including cabinet members and members of
the secret police SHIK were alleged to be involved in drugs
trafficking and illegal arms trading into Kosovo:
allegations are very serious. Drugs, arms, contraband cigarettes
all are believed to have been handled by a company run
by Albania"s ruling Democratic Party, Shqiponja (...).
the course of 1996 Defence Minister, Safet Zhulali [was
alleged] to had used his office to facilitate the transport
of arms, oil and contraband cigarettes. (...) Drugs barons
from Kosovo (...) operate in Albania with impunity, and
much of the transportation of heroin and other drugs across
Albania, from Macedonia and Greece en route to Italy, is
believed to be organised by Shik, the state security police
(...). Intelligence agents are convinced the chain of command
in the rackets goes all the way to the top and have had
no hesitation in naming ministers in their reports.28
in narcotics and weapons was allowed to prosper despite
the presence since 1993 of a large contingent of American
troops at the Albanian-Macedonian border with a mandate
to enforce the embargo. The West had turned a blind eye.
The revenues from oil and narcotics were used to finance
the purchase of arms (often in terms of direct barter): "Deliveries of oil to Macedonia (skirting the Greek embargo
[in 1993-4] can be used to cover heroin, as do deliveries
of kalachnikov rifles to Albanian "brothers" in Kosovo".29
tribal clans or "fares" had also developed links with Italy"s
crime syndicates.30 In turn, the latter played a key role
in smuggling arms across the Adriatic into the Albanian
ports of Dures and Valona. At the outset in 1992, the weapons
channelled into Kosovo were largely small arms including
Kalashnikov AK-47 rifles, RPK and PPK machine-guns, 12.7
calibre heavy machine-guns, etc.
of the narcotics trade has enabled the KLA to rapidly develop
a force of some 30,000 men. More recently, the KLA has
more sophisticated weaponry including anti-aircraft and
anti-armor rockets. According to Belgrade, some of the
have come directly from the CIA "funnelled through a so-called
"Government of Kosovo" based in Geneva, Switzerland.
office employs the public-relations firm of Ruder Finn—notorious
for its slanders of the Belgrade government".31
also acquired electronic surveillance equipment which enables
it to receive NATO satellite information concerning the
movement of the Yugoslav Army. The KLA training camp in
Albania is said to "concentrate on heavy weapons training
- rocket propelled grenades, medium caliber cannons, tanks
and transporter use, as well as on communications, and command
and control." (According to Yugoslav government sources).32
These extensive deliveries of weapons to the Kosovo rebel
army were consistent with Western geopolitical objectives.
Not surprisingly, there has been a "deafening silence" of
the international media regarding the Kosovo arms-drugs
trade. In the words of a 1994 Report of the Geopolitical
Drug Watch: "the trafficking [of drugs and arms] is basically
being judged on its geostrategic implications (...) In Kosovo,
drugs and weapons trafficking is fuelling geopolitical hopes
The fate of
had already been carefully laid out prior to the signing
of the 1995 Dayton agreement. NATO had entered an unwholesome "marriage of convenience" with the mafia. "Freedom fighters"
were put in place, the narcotics trade enabled Washington
and Bonn to "finance the Kosovo conflict" with the ultimate
objective of destabilising the Belgrade government and fully
recolonising the Balkans. The destruction of an entire country
is the outcome. Western governments which participated in
the NATO operation bear a heavy burden of responsibility
in the deaths of civilians, the impoverishment of both the
ethnic Albanian and Serbian populations and the plight of
those who were brutally uprooted from towns and villages
in Kosovo as a result of the bombings.
1. Roger Boyes and
Eske Wright, Drugs Money Linked to the Kosovo Rebels The
Times, London, Monday, March 24, 1999.
3. Philip Smucker
and Tim Butcher, "Shifting stance over KLA has betrayed"
Albanians", Daily Telegraph, London, 6 April 1999.
4. KDOM Daily Report,
released by the Bureau of European and Canadian Affairs,
Office of South Central European Affairs, U.S. Department
of State, Washington, DC, December 21, 1998; Compiled by
EUR/SCE (202-647-4850) from daily reports of the U.S. element
of the Kosovo Diplomatic Observer Mission, December 21,
5. "Rugova, sous
protection serbe appelle a l"arret des raides", Le
Montreal, 1 April 1999.
6. See Alfred W.
McCoy, The Politics of Heroin in Southeast Asia Harper and
Row, New York, 1972.
7. See John Dinges,
Our Man in Panama, The Shrewd Rise and Brutal Fall of Manuel
Noriega, Times Books, New York, 1991.
8. "The Dirtiest
Bank of All," Time, July 29, 1991, p. 22.
9. Truth in Media,
Phoenix, 2 April, 1999; see also Michel Collon, Poker Menteur,
editions EPO, Brussels, 1997.
in Truth in Media, Phoenix, 2 April, 1999).
Drug Watch, No 32, June 1994, p. 4.
13. Sean Gervasi,
"Germany, US and the Yugoslav Crisis", Covert
No. 43, Winter 1992-93).
14. See Daily
Telegraph, 29 December 1993.
15. For further
details see Michel Collon, Poker Menteur, editions EPO,
Brussels, 1997, p. 288.
Media, Kosovo in Crisis, Phoenix, 2 April 1999.
Presse-Agentur, March 13, 1998.
Ankara, 5 March 1997.
in Boyes and Wright, op cit.
21. ANA, Athens,
28 January 1997, see also Turkish Daily News, 29 January
KLA Volunteers Lack Experience, The Associated Press, 5
23. See Geopolitical
Drug Watch, No. 35, 1994, p. 3, see also Barry James, In
Balkans, Arms for Drugs, The International Herald Tribune
Paris, June 6, 1994.
24. The Guardian,
25 March 1997.
25. For further
details see Michel Chossudovsky, La crisi albanese, Edizioni
Gruppo Abele, Torino, 1998.
Gumbel, The Gangster Regime We Fund, The Independent, February
14, 1997, p. 15.
Drug Watch, No. 35, 1994, p. 3.
Drug Watch, No 66, p. 4.
in Workers" World, May 7, 1998.
32. See Government
of Yugoslavia at
Drug Watch, No 32, June 1994, p. 4.
by Michel Chossudovsky, Ottawa, 1999.
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