Confidential

Japan-Australia in the Indo-Pacific: 12 Month Outlook

On January 6th, 2022, Japan and Australia signed a reciprocal access agreement (RAA). The agreement established further alliances on trade, foreign policy, and security in the Indo-Pacific. Specifically, the RAA facilitates the cooperation between the Self-Defence Forces of Japan and the Australian Defence Forces. As such, Japan-Australia relations in the Indo-Pacific are integral to security within the region.

Indeed, the agreement represents a strategic message in a context where China is aggressively rising in the East and the South China Sea. Notably, China is interested in reunifying Taiwan as an economic advantage in the Indo-Pacific. To avoid this escalation, Japan is trying to sign a similar agreement with the United Kingdom. These cooperations will widen the strategic stronghold of Japan in the Indo-Pacific. In the next 12 months, Japan-Australia cooperation will stabilise the Indo-Pacific.

Key Judgement 1: In the next 12 months, Japan-Australia cooperation will likely make the Indo-Pacific secure and stable. 

  • PM Kishida and PM Morrison are trying to ensure stability across the Taiwan Strait to avoid military confrontation between China and Taiwan.
  • Australia contributes to Japan’s air policing effort against China, as China increases its air presence in the East and the South China Sea.
  • Japan-Australia cooperation points to decreasing the threats coming from China as one of the most important actors in the Indo-Pacific.

Key Judgement 2: In the next 12 months, China will likely make a move over Taiwan to challenge Japan-Australia cooperation. 

  • China considers Taiwan a breakaway province. Indeed, Beijing has consistently claimed Taiwan as a part of China. 

  • As a result, China is trying to reunify Taiwan to strengthen economic ties and obtain more strategic capabilities in the Indo-Pacific. This aligns with China’s wider geopolitical objectives.

  • Moreover, China is trying to expand its power over Southeast Asia for example, Thailand and Vietnam. Specifically, China seeks economic influence, geopolitical legitimacy, and maritime claims. These aims form the main motives for China’s expansionism. 

Key Judgement 3: In the next 12 months, Japan-Australia will highly likely sign a similar pact with the United Kingdom. 

  • Since 2018, the United Kingdom has supported Japan in the Indo-Pacific. Indeed, the UK provides maritime back-up to Japan under the Maritime Security Agreement between the Royal Navy and the Japan Maritime Self-Defence Forces (JMSDF).

  • In September 2021, the UK joined the security alliance between the US and Australia. As a result, Britain will provide Australia with technology to deploy nuclear-powered submarines.

  • Japan and the UK have already started formal negotiations on a reciprocal access agreement (RAA) at the end of September 2021. Firm talks between the two countries occurred in May 2022, with an agreement in principle reached. This is highly likely to be ratified within the next 12 months.

Intelligence Cut-Off Date: 10th May 2022

Confidential

Operation Momentum: The Secret Laos Guerrilla Force

Hmong People Crossing the Laos-Vietnam Border in 1971
(Img; Hmong People Crossing the Laos-Vietnam Border in 1971; via Flickr)

The political stability of Laos crumbled on the outbreak of the Laotian Civil War in 1959; a war waged by the communist Lao People’s Liberation Army against the Royal Lao Government. Often called the ‘Secret War’, the Laos Civil War had both sides receiving significant clandestine support from Cold War adversaries. For the Kingdom of Laos, this would be the US, and for the Communist forces, sympathisers from Cambodia, Thailand, and Vietnam.

The series of successful coups – beginning a year after the outbreak of civil war – only destabilised the Laotian political system further [source]. Although Laos had been overtaken by a politically ‘neutralist’ party, the war between the communists and monarchy supporters intensified. In the US, Red Scare hysteria grew domestically, considering the increasing prowess of the Soviet Union [source]. Accordingly, the US stepped up its efforts in the war on Communism, with Laos in the line of fire [source].

Operation Momentum

The Hmong People

The Hmong people are an ethnic minority group that settled in mountainous regions of Laos and Vietnam. With a rich cultural history through the occupation of remote regions, the Hmong people were almost entirely self-sufficient. The CIA saw significant opportunity in the guerrilla-style fighting capabilities of the Hmong people, which was already adapted to unconventional rural and jungle warfare. Ultimately, the CIA believed that the Hmong force would be best placed to attack groups of Communist Pathet Lao and North Vietnamese enemies, as a result of their extensive geographic and cultural understanding, as well as their unconventional warfare capabilities [source].  

The Hmong community too saw Communism as a threat to their autonomy and land ownership, which would make recruitment much easier [source]. Therefore, Operation Momentum was born: to arm and train an indigenous Hmong force as part of the US proxy war. 

A Plan in Action

The CIA ran Operation Momentum from 1960 until 1974. The plan, approved directly by the Kennedy administration, was to train an elite force of native guerrilla fighters. This force would assist US forces with covert military operations in Laos, Thailand, and Vietnam. This began on a small scale but ramped up significantly throughout the war [source]. At its height, Operation Momentum was costing US$500 million annually – equivalent to US$3.3 billion today [source].

In 1960, the CIA approached General Vang Pao, the charismatic and undisputed leader of the Hmong. In exchange for fighters, the CIA would provide training and supplies in what would theoretically be a mutually beneficial fight against the Communist insurgency. This would include aerial support, transport, weaponry, and other relevant military and civilian supplies [source]. Additionally, the CIA offered refuge in the US in the event of a military loss [source]. On this basis, General Vang Pao agreed.

Hmong Commander Vang Pao in 1961
                                              (Img; Hmong Commander Vang Pao in 1961; via Flickr)

Operation Momentum: The Largest Covert Operation in CIA History

Operation Momentum ultimately marked the beginning of the militarisation of the CIA [source]. The project, which experienced several early successes, grew significantly as the war continued. It is believed to be the CIA’s most extensive covert operation due to the enormous scale of training, operational support, and armament involved. Therefore, Operation Momentum is believed to be responsible for the training of over 19,000 troops, the average age of recruits being 15 years old [source]. The force grew to an estimated 30,000 personnel at its height.

The project ran through the presence of dedicated CIA agents within Laos, along with Thai Police Aerial Reinforcement. These agents would liaise with US Forces, the US embassy in Vientiane, and Air America to provide logistic support to Operation Momentum forces wherever possible [source].

A Loss of Momentum

The operation began to wind down in 1973 due to a political peace treaty signed in Paris. All US assistance was withdrawn by 1974. However, the Laos Civil War was still ongoing. Without US intervention, the Laotian force was significantly weakened. The Civil War continued for several years, though ultimately the Communist forces and North Vietnamese belligerents were victorious. In 1975, on the brink of the fall of Laos to communist forces, the US airlifted General Vang Pao and 2,500 Hmong fighters to safety in Thailand.

After Withdrawal

Although this was the end of the CIA’s involvement, this was not the end for surviving indigenous communities. Following its victory, the Pathet Lao administration designated the entire ethnic minority Hmong people as traitors to their country due to their allegiance to the monarchy and CIA during the civil war. As such, over 40,000 Hmong people fled from Laos, though it is believed a further 100,000 people died whilst being displaced from their homeland [source]. Whilst some Hmong people, mainly fighters, made it to the US, the CIA did not keep its promise of offering a safe new home for the majority of Hmong people who were displaced as a result of the Civil War [source].

250-pound bombs used to fight Northern Vietnamese forces in Laos, image taken in US and Laotian shared Military Base
(Img; 250-pound bombs used to fight Northern Vietnamese forces in Laos, image taken in US and Laotian shared Military Base; via History.com)

Human Rights Watch allege that Hmong people continued to be persecuted on the basis of their ethnicity and religious background as recently as 2008, illustrating that deep scars remain on this community as a result of the Laos Civil War [source]. Thailand continues to extradite Hmong refugees back to Laos, in spite of the significant humanitarian risks [source]. General Vang Pao later died in exile in the US in 2011 [source].

Summary

Operation Momentum remains one of the largest-scale clandestine interventions the CIA has ever undertaken. The mission is controversial; whilst aiding an under-militarised people, the mission was ultimately unsuccessful and led to the ethnic persecution of an indigenous community for decades to come. To this day, Laos holds the title for the most heavily bombed country in world history [source], which highlights the destruction and bloodshed that Operation Momentum left in its wake.

Confidential

The New Zealand Special Air Service: Who Dares Wins

NZSAS
(Img; New Zealand Special Air Service on a training exercise; via nzherald.co.nz)

The New Zealand Special Air Service (NZSAS) is proof that elite Special operations units exist beyond the ones commonly associated with that designator. DEVGRU, Delta Force, SAC, British Special Air Service (SAS): the usual suspects that often come to mind, that the public assumes handle the most sensitive unconventional missions around the world.

The New Zealand Special Air Service stays relatively under the radar as far as media attention goes, which isn’t the worst thing for that line of work. Behind the shadows of the NZSAS lies a fascinating origin story, and a rather unknown legacy shaped by participation in international special operations.

History

Long Range Desert Group

World War II was a breeding ground for the prototypes of modern-day special operations units. That includes the New Zealand Special Air Service, along with its close relative, the British SAS. North Africa was contested in WW2, with Italy the predominant Axis occupier, and the British as their primary belligerent. The relentless open desert and scorching dry heat posed new challenges to military personnel. This is particularly true for intelligence gathering and the undetected deep infiltration of enemy lines.

Special circumstances called for the raising of a new unit to tackle that problem, and thus the Long Range Desert Group (LRDG) birthed in June 1940. The unit was inititally under the command of British Maj. Ralph Bagnold. Bagnold had experience navigating through the desert in the 1920s and 1930s, during the gap between the two Great Wars. His experience and personal character made him a prime candidate to spearhead the LRDG, which shaped into a unique force.

The unit specialised in “long-range reconnaissance, intelligence gathering, direct action, and infiltration and exfiltration of other special-operations units.” The LRDG would therefore form the basis of the modern New Zealand Special Air Service.

Post-War NZSAS

In the post-war era, 1955, the New Zealand Army used the experienced soldiers from the LRDG and similar operations to form what would eventually become the New Zealand Special Air Service to model their commonwealth partners in the British SAS.

The service conducted operations in Southeast Asian countries including Thailand, Malaya, East Timor, and Vietnam, as well as Kuwait, Papua New Guinea, and most recently Afghanistan.

Long Range Desert Group personnel in World War II
(Img; Long Range Desert Group personnel in World War II; via picryl)

Selection Process

The process of selection for the modern New Zealand Special Air Service does not digress from its high tier counterparts. Therefore, attrition rates in selection are astronomically low; between 2013-2017, 243 candidates attempted selection. However, only 31 made it to the next stage.

The selection process include rigorous physical and mental exercises, all with minimal sleep and nutrition, and conducted in various terrains. Being in prime physical shape is a requirement, but possessing a sound mind that shows a genuine desire to be a part of the NZSAS is the ultimate deciding factor for candidates. The ability to work on a team is a requirement, and peer evaluations help identity those who miss the mark.

Training Programme

Candidates who make it past selection have only just begun the long training pipeline. Following completion, new operators receive the prestigious title and uniform designators possessed by all NZASA operators. Initial training takes a minimum of four months, with further specialised training courses taken depending on placement. The pipeline itself is, like many other aspects of the branch, a mirrored version of similar units. It includes:

  • Demolition
  • Medical
  • Airborne
  • Diving
  • Communications
  • Mountaineering
  • Any other skills required to conduct special operations missions
(Vid; NZSAS Training Overview; via NZ Defence Force on YT)

Organisation

Units within the New Zealand Special Air Service have diversity in skill sets yet operate underneath the umbrella of a few specific core tasks.

  • Special Reconnaissance – like their origins with the LRDG, special reconnaissance tasks require units to conduct operations deep behind enemy lines, with minimal support and facing austere and potentially volatile conditions.
  • Direct Action – direct action tasks are some of the more straightforward types of special operations, such as conducting raids on maritime vessels, or search and rescue operations.
  • Combating Terrorism – counterterrorism for NZSAS personnel means partnering with other national government forces, especially in the light of a active terrorist threat
  • Support and Influence – support and influence operations are like the work conducted by United States Green Berets. They can task NZSAS personnel with the support and training of host nation defence forces and developing their internal security programs.

Unit Composition

The force is small, which is reflected in their basic unit breakdown.

  • A&B Squadron – these are the two primary special forces squadrons underneath the NZSAS organizational structure. Personnel within the units are the primary operators, who assist in the planning and execution of missions within the core task fields.
  • D Squadron (Commando Squadron) – counterterrorism is the bread and butter of D squadron – specifically within New Zealand and its surrounding territories. Commandos go through a specialized selection catered to their unit mission, followed by a four-month long training pipeline that focuses on cultivating skills, including:
    • close quarters combat
    • marksmanship
    • tactical insertion over multiple types of terrain
    • intelligence/reconnaissance gathering.
  • E Squadron (Explosive Ordinance Disposal Squadron) – Explosive Ordinance Disposal (EOD) operators in E Squadron are not required to complete the same rigorous selection process as the other tactical personnel, but still must complete a highly shortened version called Special Operations Forces Induction Course (SOFIC). The course teaches basic skills to mesh EOD techs with their counterparts. The core tasks of E Squadron mirror other EOD units across the world.
  • Support Squadron – special operations cannot be completed without logistical, administrative, and other forms of support. That is where Support Squadron comes in. Personnel in this Squadron must complete SOFIC, and deploy with the other units, albeit in their own specialized support capacity.

Recent Operations

Female Engagement Team

The Female Engagement Team (FEM) was established in 2017 to support Special Operations Force Objectives. The unit works closely with the NZSAS to provide operational support where it would be culturally more appropriate for female rather than male operatives to work. As a result, the operatives in this unit receive much of the similar training to other units, as well as training in regional culture, communication skills, and reconnaissance.

NZSAS: The New Zealand Special Air Service Female Engagement Team

2021 Afghanistan Evacuation

The New Zealand Special Air Service’s most recent activity was in the 2021 extraction of NATO forces from Kabul, Afghanistan. According to a press release from the New Zealand defence department,

“The safe passage of hundreds of evacuees from Afghanistan was made possible by an elite group of New Zealand soldiers who used code words and tactical landmarks to assist their efforts in an attempt to avoid chaotic and dangerous scenes… The turbulent and dangerous environment saw Special Forces troops, including the Female Engagement Team, move deep into the security area designated around HKIA, at times utilising a canal, to reach those they had been sent to help, guiding them through the crowds to points on the perimeter where they could be brought into the airport, secured, and safely evacuated.”

Afghanistan was once the home to a selection of NATO nations, as part of the US-led war campaign. New Zealand had a presence there, and the NZSAS conducted operations to support the overarching global mission. For example, Operation Burnham was one of such.

A detachment of Kiwi operators conducted a planned night raid in the Tirgiran Valley, in October 2010. In the aftermath, around seven Afghan nationals and one girl were killed. The caveat is that they did not confirm the Afghan KIA to have been insurgents, and then later covered up the results of the raid, including the death of the young girl. Subsequently, a cover-up from the command and other details led to an eventual investigation and report.

NZSAS: The New Zealand Special Air Service

Achievement

Owing to its success as a Special Forces Unit, the NZSAS and its operatives are highly decorated. The unit has received numerous honours. Notably, the Governor-General of New Zealand awarded Corporal Willie Apiata with the Victoria Cross for New Zealand in 2007. Similarly, the unit received a Presidential Unit Citation for its contribution to Task Force K-BAR as part of the War in Afghanistan from 2001.

Summary

The NZSAS is an experienced Special Forces unit that has experience in unconventional warfare and all manner of intelligence tradecraft. The unit continues to work closely with other international Special Forces to achieve its strategic objectives.

This artcile was written by Abbi Clarck and Michael Ellmer

Confidential

Human Trafficking from Laos: How, Why, and Where?

Introduction/Background

Laos, officially named Lao People’s Democratic Republic (PDR), is a Southeast Asian country bordering China, Vietnam, Cambodia, Thailand and Myanmar. As part of the so-called ‘Golden Triangle’ (the intersection between the Lao, Myanmar, and Thailand), it is common for illicit goods to move between these countries. This includes a large amount of Human Trafficking.

Laos-Thai Border, marked by the Mekong River
(Img; Laos-Thai Border, marked by the Mekong River; Via WikiCommons)

This Grey Dynamics article will examine the nature of Human Trafficking originating in Laos and the contributing factors.

Human Trafficking from Laos: A Lucrative Trade

Human Trafficking is the world’s most lucrative illicit trade. Whilst exact numbers are impossible to ascertain due to their informal and undocumented nature, reports estimate that over 20.9 million people were victims of Human Trafficking in 2011. Of this, 34% occurs in Asia. Specifically, Laos is a prevalent source of persons trafficked to other areas of South East Asia.

(Img; Human Trafficking in SE Asia in 2018 index; via @AFP on Twitter)

Why Laos?

Geographic

Laos shares a large border with Thailand, much of which along the Mekong River. The move between Laos and Thailand is relatively easy – as such, migrants can enter Thailand with relative ease at many unattended border areas, often by foot, car, or boat. 

Economic

Many victims of Human Trafficking travel voluntarily, under the false premise of employment or education opportunities in another country. Laos citizens are particularly susceptible to these tactics as Laos is an impoverished country. For this reason, the majority of persons trafficked from Laos are young people between the ages of 12 and 18 years old.

Legal and Social

Similarly, reports have shown Laos to have a high corruption index. Corruption comes in many forms and facilitates Human Trafficking in multiple ways, according to the UNODC:

  • recruitment of smuggled migrants and victims of trafficking;
  • production and procurement of fraudulent documents;
  • border crossings (at land and maritime borders and in airports);
  • preventing investigation

COVID 19 Impact

The COVID 19 Pandemic has exacerbated existing social, political, and economic issues in Laos. The US Department of State Office to Monitor and Combat Trafficking in Persons reported that the pandemic increased the vulnerability of Lao nationals, leaving them more susceptible to established trafficking techniques. As a result, Laos citizens are lured into marriages and sexual exploitation, mainly in China.

Human Trafficking Destinations

Laos does have formal channels for the movement of persons to Thailand through the Memorandum of Understanding on Cooperation in the Employment of Workers (MoU). However, the lengthiness and expense of using these channels make the scheme inaccessible for most Lao people. The UN found that “migration through informal channels costs between THB 2,500 and 3,000 compared to the THB 20,000 or more for migration using official procedures”. As a result, most Lao migrant workers will use informal, undocumented channels, leaving them more open to trafficking and exploitation.

Most victims of Human Trafficking are trafficked to Thailand or China, though other destinations such as Vietnam and Malaysia are also possible.

Estimates suggest that around 90% of trafficking from Laos is to Thailand. This is because of Laos’ long border with Thailand along the Mekong River. This stretch provides opportunities for undocumented and illegal crossings between the two countries.

Common Human Trafficking routes within the Golden Triangle
(Img; Common Trafficking routes within the Golden Triangle; via Laos Open Development)

However, more recently, there has been a decline in the number of victims of trafficking being identified within Thailand. This does not necessarily correlate to a decrease in trafficking – human traffickers keep collaborative networks with Lao intermediaries to facilitate the recruitment of victims.

Trafficked persons from Laos are forced into multiple industries, including sexual exploitation, forced labour in manufacturing and agriculture and other tasks.

Frequently, traffickers seize victims’ documentation and sell it onto the black market, making a return more challenging for trafficked persons.

Efforts Against Human Trafficking

Lao PDR has been working with the UN since 2018 and supporting research to identify the critical drivers of trafficking and prevent this. Laos, as of 2019, is in the US Department of State Tier 2 (Up from Tier 3 in 2018) within the Trafficking in Persons Index, indicating:

“The Government of Laos does not fully meet the minimum standards for the elimination of trafficking but is making significant efforts to do so.”

Laos has been making a concerted effort to improve political and social provisions to prevent Human Trafficking. Whilst there is significant progress, there is still a long way to go. Lao authorities have significantly stepped up anti-trafficking controls and surveillance at border crossings and increased anti-trafficking education initiatives.

NGOs such as World Vision have initiatives to prevent Human Trafficking in the region. These schemes aim to increase education and employment opportunities to make local communities less likely to become victims of this exploitation.

Summary

Human Trafficking from Laos remains a lucrative and relatively low-risk trade for international criminals. Due to the informal channels of recruiting persons, ease of undocumented travel, and lucrative monetary reward coming from this trade, it is highly unlikely that this activity will cease in the near future. Unless a concerted multinational legal effort is made to crack down on this behaviour at borders and elimination of corrupt officials, trafficking networks will continue to move and sell persons through existing trade routes illegally.

Confidential

Office 39: North Korea’s Secret Slush Fund

Office 39: The North Korean Slush Fund

Office 39 is also known as Bureau 39 or Room 39. Kim Jong-Il created the organisation in 1974 as an additional revenue flow for the regime. The North Korean regime unofficially uses Office 39 as the primary substitute to its formal economy. The authoritarian nature of the regime, together with sanctions, pressures North Korea to secure stable forms of financing.

  • Bodies like office 39 are certainly crucial to the continuation of the North Korean state. The structure of the office within the KWP indicates a high degree of influence within the national security framework of North Korea.
  • All foreign diplomatic posts of North Korea are likely to have a member of Office 39. The decrease in official and diplomatic North Korean participation is likely superficial. Ultimately, office 39 is likely to prioritise economic compensation over accountability and avoiding a public scandal.

Office 39: Background

Sanctions

The North Korean regime faces sanctions targeting its economic and trade activity since 2005. Activities like money laundering through Banco Delta Asia became the focus of criticism. The importance of nuclear and military capabilities to North Korea reinforces the need of maintaining a separate flow of capital. As a consequence, Office 39 is used to circumvent sanctions.

The illicit nature of Office 39

Illicit activities form part of Office 39 since its creation in 1974. The agricultural department of the KWP forced citizens to engage in ‘Pomyong’. This was, in essence, leasing a third of a village or property’s natural terrain for poppy seeding. Ultimately, the poppies collected ended in processing centres where opium would be distributed. Trafficking opium is an example of the degree of state control over illicit activities.

Apart from the trafficking of narcotics, Office 39 is involved in money laundering, weapons trafficking and counterfeit goods. The regime’s financial alternative behaves as a criminal organisation focused on profits under the control of a state.

Office 39: Identity and Nature

An effective economy

Office 39 is the organisation that runs an autonomous financial network maintaining the regime. Defectors in 1997 suggested that eliminating this financial body was ‘effectively killing Kim Jong-Il’. In 2013, South Korean media reported $5 billion stored by Kim Jong-Un in 7 different countries.  Due to this, Office 39 is almost certainly a crucial factor explaining the adaptability of the regime to international sanctions.

Governmental nature of Office 39

The organisation uses a combination of state officials, civilians and foreign nationals to generate revenue with licit and illicit activities. Operations are ultimately in control of the regime leadership, despite the increased presence of civilians and non-KWP personnel. The centralised control over activities while using state and non-state officials increases reliability and decreases accountability.

Structure and Organisation

Office 39 and Organogram of North Korean Party & Government
Organic fit of Office 39 within the DPRK structure

Fit within the Korean Workers Party (KWP)

The leader of the regime, structurally, is directly connected to Office 39. this case Kim Jong-Un although previously to Kim Jong-Il. The clandestine financial source of the regime enjoys a separate condition from other departments within the KWP. Within the KWP, the Finance and Budget department reports to officials of the KWP before the regime leadership. Office 39 sits above the KWP. The same individual heading the slush fund directs the Organisational and Guidance Department (OGD).

The OGD is responsible for adopting party and policy direction. It is an ideological branch controlling the KWP. The OGD supervises all branches of the KWP and other governmental divisions, including the Korea People’s Army (KPA). It is a likely indicator of shared power that both the OGD and Office 39 enjoy the same status as specialised departments. The activities of Office 39 are therefore likely present within all departments of the KWP and ensure a greater capability of economic collection. The state uses the slush fund through all its channels to maximise profits and protect operations using national resources.

Chain of Command

Within the OGD, ‘Bureau 39’ likely reports to Shin Ryong-man. In turn, Ryong-man likely answers to superior officials or to Kim Jong-Un himself. Alleged reports of Kim Yo-Jong leading Office 39 are likely misleading. Instead, there is a realistic probability that Jim Yo-Jong acts as an intermediate figure between Kim Jong-Un and Shin Ryong-man.

‘Bureau 39’ is structured, consequently, as a large-scale criminal organisation. Being crucial to the regime, Office 39 uses state capabilities to maximise profits, almost certainly avoiding efforts of deterrence. Diplomatic, civilian, and military branches of government collect funds through illicit means. For example, funds are collected through the intelligence agency, the Reconnaissance General Bureau. The officials are instructed to obtain economic profits from the leadership.

Office 39 Tactics Techniques and Procedures

Money Laundering

Office 39 carries out money laundering operations despite prevention efforts. Front companies and foreign bank deposits are used, typically, to launder money and assist Office 39 in other illicit activities.  In 2003, the Wall Street Journal reported foreign deposits of Kim Jong-Il reaching $5 billion. The North Korean regime laundered $5 billion through Banco Delta Asia in Macau, with accounts frozen in 2005. Defectors, meanwhile, failed to freeze Swiss bank accounts belonging to high-ranking North Korean members. Ultimately, money laundering is likely the crucial node of Bureau 39 as it supports and allows other illicit activities to occur.

Counterfeit money

State capabilities are almost crucial for the survival of Office 39. Embassies and their staff export counterfeit money such as the ‘supernotes’, forged $100 bills extremely difficult to detect. The same embassy attacked in Madrid by Free Joseon likely serves as another post for the bureau. The export capabilities, consequently, linked the IRA and Asian crime syndicates as clients for counterfeit currency operations.  

Narcotics and weapons trafficking

Weapon and drug trafficking are likely to have a dual-use to the regime. On the one hand, illicit operations of weapons and drugs attract the finances necessary for the leadership. Simultaneously, the export of drugs and weapons puts pressure on foreign states. A weapon shipment, for example, was flagged in Thailand in 2009 heading towards the Middle East. Contrary to counterfeit and money laundering, there is a short-term threat to drugs and weapons trafficking.

Difficulty of detection

Economic and sanction-based measures are unlikely to deter long-term activity. C4ADS reported in 2018 that current sanctions, using the example of luxury goods, are ineffective against trafficking measures. The weapons shipment flagged in Thailand, specifically, used 16 different front companies to disguise its origin. Measures against Bureau 39 likely serve a short-term purpose, until the regime uses another official to adapt the methodology and continue operating.

Confidential

Rosewood Logging: A Means for Money Laundering and Terrorist Financing

Rosewood
(Img; Rosewood Logs outside a market in China; via YaleEnvironment360)

Rosewood: Summary

Rosewood Trade is a lucrative one – rosewood is the single most illegally trafficked natural product globally. This trade is primarily fuelled by enormous demand from China. The traditional Chinese Hongmu furniture market relies heavily on imported rosewood to sustain the industry. As a result, this is an industry exploited by criminals in recent years.

Rosewood logging: So what?

Rosewood is a precious commodity and has strict regulations on its trade. However, it is the world’s most trafficked natural commodity, despite its status as a protected species under the Convention on International Trade in Endangered Species (CITES). Due to the surplus of demand over supply, has been known to sell in black markets for up to US$80,000 per tonne, making it an incredibly lucrative business.

Rosewood Imports to China by Origin & Volume
(Img; Rosewood imports to China by origin and volume; via Forest Trends)

Aside from its devastating environmental and economic impact, recent research suggests that illegal rosewood logging provides a hotbed for money laundering and terrorism financing, facilitated by corruption across multiple countries.

Background

Much of the product imported into China originates primarily from Madagascar, Thailand and West Africa.

Financial Flows & Key Players in the Illicit Rosewood Trade

(Img; Cashflows involved in the rosewood Illicit trade; via Anti-Corruption Resource Centre)

Recent investigations have shown Chinese importers to source rosewood from Boko Haram controlled areas knowingly. Exporters and importers have little regard for the regions they are sourcing raw materials from due to the high value of products.

In some senses, the designation of as a protected species by CITES has worked against its conservation aims. Research suggests that the CITES rules have driven up the price for rosewood furniture in China, creating a further incentive for criminals to engage in illegal smuggling operations.

Similarly, the illicit logging issue is facilitated by local authorities, showing levels of corruption at all levels. There are frequent instances police and border officers turning a blind eye to smuggling operations due to bribing or pressure and threats from smugglers.

There are multiple instances of this species being smuggled without permits across borders. In these instances, smugglers retroactively create permits made to legitimise the sale. However, this is in contravention of CITES regulation and national laws.

Conclusion

Whilst international law is in place in an attempt to stop the illicit and unsustainable trade of this species, little is being done to enforce these laws. Similarly, the transnational nature of the issue means that the regulations are being policed inconsistently.

Whilst progress is being made in terms of policing at borders to prevent the shipment of this illegal species. However, this does little to slow the industry – the root cause of the problem remains that criminals will continue to trade in rosewood at low risk of prosecution, with disregard of material origin.

Confidential

Hezbollah: Black Ops Intelligence

Hezbollah External Security Organisation (ESO) is labelled as the foreign military wing of Hezbollah. The idea of the ESO goes further than what can be perceived as a ‘military wing’. The External Security Organisation (ESO) or Unit 910, is Hezbollah’s black ops clandestine branch with a likely network of agents spanning five continents.

Hezbollah: Unit 910
The External Security Organisation (ESO) or Unit 910, is Hezbollah’s black ops clandestine branch with a likely network of agents spanning five continents.

Why Does This Matter?

Also known as “Unit 910” or “Islamic Jihad Organisation” (IJO), the branch functions as Hezbollah’s black ops intelligence wing.

  • The ESO is not limited to the operational preparation and execution of targeted attacks. Aiding Hezbollah’s interests likely lies in maintaining financial flow to support operations and infrastructure in Lebanon.
  • Foreign Lebanese communities are likely to be exploited by ESO operatives to strengthen the flow of income as well as other resources. Expatriate communities are likely to be targeted with a financial rather than an ideological interest.
  • It is likely that the ESO has the operational cross-continental capability. The compartmentalisation of the branch reduces the effect arrests have on ESO foreign operatives.

Why is this Important?

Public attention is on Hezbollah’s relationship with the Iranian government, as well as Hezbollah’s role within Lebanese society. The International Institute for Strategic Studies estimated that Hezbollah has 20,000 members, with a majority in the Middle East. Hezbollah’s black ops only share a small proportion of that figure, yet that does not imply that the ESO lacks resources or capabilities. ESO operatives were arrested in Asia, Africa, South & North America as well as Europe.

A perception of a military wing should not create an idea of loosely connected cells or sympathisers of Hezbollah with no unified objective. Extensive clandestine training makes Hezbollah’s black ops resemble an authoritarian intelligence agency. Its clandestine nature makes ESO operatives what would be traditionally considered ‘Illegals’ in intelligence tradecraft.

Hezbollah: Tactics, Techniques & Methodologies

Unit 910 is the covert foreign intelligence and operational branch of Hezbollah outside the Middle East. Hezbollah’s black ops are led by Salman Raouf Salman, responsible for the AMIA bombing in Argentina in 1994. The ESO is responsible for all clandestine foreign activity relating to intelligence, counter-intelligence and operations. It has both cross-continental capability and a capacity to penetrate licit and illicit environments.

The ESO’s tactic is likely to develop long-term operational, intelligence and counter-intelligence capabilities outside Lebanon and the Middle East. Unit 910 deploys operatives who blend in communities and maintain cover stories while being controlled by a handler. Hezbollah’s black ops likely prefer gathering capabilities and obtaining intelligence instead of carrying out attacks to avoid drawing law-enforcement.

To avoid law-enforcement, compartmentalisation characterises the functionality of Hezbollah’s black ops. Training recruits as well as handlers are given false identities and nicknames. Recruits are delivered to training using window-tinted vans, while heads are covered to prevent any leak of knowledge regarding the methodology of the ESO. An arrested operative’s handler stated that “the less you know the better it is”.

Hezbollah: Training

Training is divided into military, intelligence and ideological categories. It is carried out in camps in Lebanon and lasts an average of 6 years. Ideological training lasts 6 days, while the remaining training period is dedicated to weapon and explosive handling and intelligence tradecraft. Training camps have the capability of holding field exercises. This makes Hezbollah’s black ops capable of carrying out simultaneous training of multiple operatives. 

Military training includes extensive experience in explosives as well as weapons handling, with drills completing the period. Operatives are taught how to produce and handle explosives like Ammonium Nitrate, as well as training to avoid law-enforcement attraction in gathering needed supplies. Weapons handled include AK-47’s, M16’s, MP-5’s or RPG’s in military drills. Altogether this makes Hezbollah’s black ops operatives experienced in sabotage operations.

Intelligence tradecraft is taught through surveillance, counter-surveillance and communication training. Agents learn to take photographs and videos without drawing public attention. To gain experience, operatives are tasked to carry surveillance on Israeli troop movements in Southern Lebanon and provide intelligence on patterns, behaviours and vulnerabilities. Additionally, communication methodologies through email are taught, using coded messages sometimes labelled as ‘spam’ to indicate instructions.

Hezbollah

Ammonium Nitrate / Phillie Casablanca.

Missions

Hezbollah’s black ops sent operatives to New York, Washington, Thailand, Panama to gather capabilities or obtain intelligence. The latest arrest of Alexei Saab shows the deployment of the agent to New York in 2000. Saab produced photographs highlighting potential targets of key public infrastructure like the Brooklyn Bridge or the White House. The agent, arrested in March 2019, also married a female to provide her access to US citizenship.

Samer El-Debek and Ali Kourani, arrested in 2017, carried out intelligence gathering in Thailand, Panama and the US. El-Debek travelled to Thailand to empty a safehouse detected to be under surveillance. Hezbollah’s black ops also sent El-Debek to Panama, using Colombia as arrival and departure points, to provide intelligence regarding vulnerabilities of the Panama Canal. In the US, Kourani’s handler instructed the operative to obtain intelligence on IDF soldiers as well as night-vision, communication and drone technology, to replicate and increase the ESO’s capabilities.

Image: The 961 (link)

Confidential

Anthony Poshepny: A CIA Legend

Anthony Poshepny

Anthony Poshepny was an early paramilitary officer in the CIA whose career reads like a piece of epic fiction.

Truth be told, Anthony Poshepny liked ears. He liked them so much that he would cut them off the corpses of his enemies and add them to his collection. Sound too black metal to be true? Take it from the man himself, as he explained his process to author Roger Warner for his book Shooting at the Moon:

“I used to collect ears… I had a big, green, reinforced cellophane bag as you walked up my steps. I’d tell my people to put them in, and then I’d staple them to this 5,000-Kip notice…”

Kip is the official currency of Laos – a country of great significance in Poshepny’s life. The referenced notice? A rather unconventional expression of under-the-table hired labour: 5000 Kip for the ear of a Laotian guerrilla.

That is but a verse in the scriptures of Poshepny, for the account of his life rivals that of Homers Odyssey. It is borderline mythic…    

Anthony Poshepny Origins

Anthony A. Poshepny, also known as Tony Poe, was born in 1924 in Long Beach, California. 18 years later in 1942, the United States entered World War II following the Pearl Harbor attacks. Poshepny, being the absolute unit of a man that he was, enlisted to serve in the United States Marine Corp – the weakest branch of the US armed forces.

Poshepny’s first unit assignment and introduction to the SOF life was with the short-lived Second Parachute Battalion – a component of the experimental Marine Corp program that deviated from traditional amphibious landings. In 1943 the Marine Corp reevaluated the program which led to its disbandment. The Corp ultimately lacked a sufficient fleet of transport planes which impeded the effectiveness of the Parachute unit mission.

As an enlisted free-agent, Poshepny was assigned to the 5th Marine Division and fought in the Battle of Iwo Jima. It was on that field of Battle that he received a purple heart after sustaining a leg injury. On the 30th of November 1945, Anthony received an honourable discharge from the beloved Corp.

From Student to Special Activities Division

With the first chapter of his life behind him, Anthony Poshepny took advantage of his GI Bill and enrolled in St. Mary’s college in San Francisco for a short stint followed by a transfer to San Jose State University. Upon graduation in 1950 with a double major in History and hard-charging, Poshepny aspired to get into the FBI but found his way into the CIA as it was still in its infancy, so much that he was in the first class to go through training at Camp Perry, VA, also known as “The Farm” in CIA lore.  

Following his training in the art of the spook, Poshepny returned to the path of the warrior, this time as a paramilitary officer in the early days of the CIA’s paramilitary wing now known as the Special Activities Center.

Anthony’s first assignment was to support the agencies efforts in the Korean War where he fell under the command of Major General John K. Singlaub – another special operations legend. The task at hand in Korea was to train a group of Chongogyo practitioners (Korean pantheistic religion) to cross the 38th Parallel and collect intelligence for the agency.

After bouncing around Southeast Asia for a bit, Poshepny was assigned to the Tibet political-military program where he found himself training Khamba guerrillas in Camp Hale, Colorado. These fighters would eventually help the Dalai Lama escape Tibet in 1959.

Laos

Anthony Poshepny hated communism, which also happened to be the flavour of the decade in Southeast Asia. As the Vietnam war waged in the South, its neighbouring country of Laos was the location of its own secret war and a part of the Ho Chi Minh Trail as covered in this Grey Dynamics Article. In his article Air America in Thailand, Dr Joe F. Leeker writes that in early 1961, Poshepny along with other CIA officers were “sent to Laos to strengthen Royal Lao government control in the north.”

It was in Laos where Poshepny would conduct the bulk of his most notable exploits. During his time there, not only did he recruit and train anti-communist Laotian fighters, but he joined them in “fighting terror with terror”, collecting the ears of his enemies and in two instances dropping their severed heads from a helicopter down to their comrades. His legacy in Laos was highly controversial, yet his brutal tactics earned him the respect of the Hmong hill tribes under his watch.

Anthony Poshepny lived to the age of 78 and died peacefully on the morning of the 27th of June 2003. His long history of service and legendary accounts from his life have established him in the special operations community as an operating god amongst tactical mortals.

Image: Alchetron (link)