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Do Mexico Cartels Control the US Heroin Trade?

By InSight. On March 2, a federal court in Columbia, South Carolina sentenced Frediberto Pineda, an alleged operative for the Sinaloa Cartel, to 20 years in prison on drug-trafficking charges. Pineda’s conviction is only the latest sign of trouble for South Carolina, which in recent years has become an epicenter for the Mexican heroin trade.

According to the Los Angeles Times, 111 people have been convicted on criminal charges since the FBI began cracking down on South Carolina’s drug trade in 2009. The Sinaloa Cartel is believed to have links to heroin distribution cells in the city, selling a cheap and potent brand of heroin known as “black tar.” But the business connections between some of these local, independent distributors and the bigger, Mexico-based drug-trafficking organizations (DTOs) should not be overstated.

A 2001 report by the National Drug Intelligence Center noted that black tar heroin was first observed in Charleston in 2000, then available only in “limited quantities” across the state. Times have changed since then: as part of a push to expand east of the Mississippi, while avoiding larger cities like New York, Mexican groups have pushed black tar into the southeast and midwest markets. The rate of heroin seizures and overdoses began to rise as black tar became readily available in cities like Nashville, Minneapolis, Columbus and Charlotte, where the brand was previously uncommon.

Much of this heroin is sourced directly from the Pacific Coast state of Nayarit, long a center for the opium trade. Poppies are grown and processed there, then smuggled to the border, where a fee is most likely paid to one of the “Big Brother” cartels — the Sinaloans, the Juarez or Gulf Cartel — for the right to use the corridor. The Nayarit heroin smugglers likely pay another fee to these cartels, in return for using some of the market space in cities like Columbus, where Sinaloa operatives like Pineda are reportedly deployed to handle the cocaine trade.

But, as noted in a report published last year by the Woodrow Wilson Center, such payments may be the only real connection between some of these heroin distribution cells and monolithic DTOs like the Sinaloa Cartel. And it may have been the tenuousness of these links to larger DTOs that allowed the spread of these smaller, more nimble cells across the U.S.

As detailed by the Woodrow Wilson Center report, many of the Nayarit cells in South Carolina operate like independent franchises, running their own supply chains and setting their own prices. Law enforcement in South Carolina has compared the business model to a Domino’s pizza chain: runners deliver the product to clients, local managers oversee operations and report back to Mexico, and none of the low-level operatives have much idea of who the top-level bosses are.

In fact, in contrast to the larger Mexico-based drug syndicates, there are few top-level bosses among these smaller, decentrailized heroin networks in the U.S. As the LA Times reported in a 2010 story about the spread of black tar into the midwest, these cells are run by “entrepreneurs” whose workers are loosely disciplined, and frequently break loose to form their own heroin dealerships. Unlike in Mexico, where such fragmentation is usually accompanied by surges of violence (like that in Jalisco and the embattled city of Acapulco), this is done relatively peacefully in the U.S. In some ways, more competition is better for business, as it keeps the price of black tar low and keeps attracting buyers, looking for a cheap alternative to Oxycodone or other prescription drugs.

There are indeed indications that Mexico’s largest DTOs — the Sinaloa, Gulf, Juarez and Tijuana cartels — have established presence in cities ranging from Charlotte to Seattle to Anchorage. But when reports emerge clamouring over the increased presence of Mexican cartels in in the U.S., it is worth asking: What does this presence actually look like? In the case of the black tar heroin networks, law enforcement has said that the links between city cells and the big Mexican DTOs are indirect, at best.

In some cases, as apparently occurred with Frediberto Pineda, cartels may establish presence in a U.S. city by directly deploying operatives from Mexico. But it is worth remembering that the issue of cartel “presence” in a U.S. city is not always so cut and dry. As is the case with the black tar heroin network, there are drug “franchises” out there in which the big Mexican DTOs are only loosely involved.

Decrying the penetration of Mexican cartels into U.S. territory, then, means considering how the modus operandi of these drug networks actually function. Mexican cartels may be in the U.S., but they may not even be interested, let alone capable, of fully controlling the domestic market.

Read more: http://www.insightcrime.org/insight-latest-news/item/797-do-mexico-cartels-control-the-us-heroin-trade

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