July 18, 2020

ITALY: Dozens Of Mafia Arrests Conducted Across Italy And Elsewhere In Europe. Fourteen Tons Of Amphetamine, 86 Million Pills Supplied By Islamic Militants In Syria For The Mafia Were Seized In Italy.

Scarcity Studios published July 13, 2020: La Cosa Nostra Raids - 86 million pills Seized in Italy and Dozens Of Mafia Arrests.
The Europol press release

Dozens of people have been arrested in a series of largescale anti-mafia raids conducted across Italy and elsewhere in Europe.

On July 1st, a joint operation between Germany's federal police force and Europol targeted clans of the Cosa Nosta - also referred to as the Sicilian Mafia - from the town of Barrafranca in the Sicilian province of Enna.

Codenamed Operation Ultra, over 60 house searches were carried out, resulting in the seizure of 1.5 million Euros, along with boxes of documentation thought to be of use to the investigators.

One suspect was arrested in the German city of Wolzburg and Europol claim he is a high-ranking figure within the organisation.

Just a day before, a series of raids also took place against another Italian crime syndicate - , which saw 200 officers from Italian state police arrest a total of 12 men in Piedmont and Turin respectively.

Over 30 houses were searched, resulting in the seizure of a rifle and a quantity of drugs. Among those suspect arrested, one is thought to a leading member of one of the Calabria based clans.

Codenamed Operation Altan, it was described by Europol as a "coordinated and decisive action...[and] the result of a long and complex investigation carried out by the Italian authorities with the support of Europol and law enforcement agencies from Croatia, France and Germany."

Altan - which began in 2017 - focused specifically on the Alvaro clan, based in the Italian region of Calabria. Europol claim the clan was active not only in several Italian cities, but also within other EU member states.

"The exchange of information between Europol and law enforcement authorities from Italy, Croatia, France and Germany was key to crack this case: the success of this operation shows the importance of international cooperation in tackling this organised criminal group which is one of the most powerful criminal networks in the world, and controls much of Europe's cocaine trade, combined with systematic money laundering, bribery and violent acts."
Financial Times
written by Miles Johnson in Rome
Tuesday July 7, 2020

International investors bought bonds backed by the crime proceess of Italy’s most powerful mafia, according to financial and legal documents seen by the Financial Times.

In one case, the bonds — backed in part by front companies charged with working for the Calabrian ’Ndrangheta mafia group — were purchased by one of Europe’s largest private banks, Banca Generali, in a transaction where consulting services were provided by accountancy group EY.

About €1bn of these private bonds were sold to international investors between 2015 and 2019, according to market participants. Some of the bonds were linked to assets later revealed to be created by front companies for the ’Ndrangheta.

The ’Ndrangheta is less well-known outside Italy than the Sicilian mafia but has risen over the past two decades to become one of the wealthiest and most feared criminal groups in the western world, engaging in crimes ranging from industrial-scale cocaine trafficking to money laundering, extortion and arms smuggling. 

Europol, the EU’s law enforcement agency, has estimated that the activities of the ’Ndrangheta, which is not made up of a centralised organisation but hundreds of autonomous clans, generate a combined turnover of €44bn a year. 

Other investors in the bonds included pension funds, hedge funds and family offices, all looking for exotic ways of earning high returns at a time of record-low interest rates, according to people involved in the deals.

The bonds were created out of unpaid invoices to Italian public health authorities from companies providing them with medical services.

Under EU law, overdue invoices owed by state-connected entities incur a guaranteed penalty interest rate. This makes them attractive for special purpose vehicles, which place them into a large pool of assets and issue bonds backed by the expected cash flows from the future settlement of the invoices.

Most of the assets securitised in the deals were legitimate but some were from companies later revealed to be controlled by certain ’Ndrangheta clans, which had managed to evade anti-money laundering checks to take advantage of international investor demand for exotic debt instruments.

One bond deal purchased by institutional investors contained assets sold by a refugee camp in Calabria that had been taken over by organised criminals. They were later convicted for stealing tens of millions of euros of EU funds.

Almost all were private deals not rated by any credit rating agency or traded in financial markets. CFE, a Geneva-based boutique investment bank, constructed the vehicle that sold bonds to investors including Banca Generali.

When contacted by the FT, Banca Generali said it was unaware of any problems with the underlying assets that backed the bonds it had purchased for its clients and that it had relied on other intermediaries to conduct anti-money laundering checks on the underlying portfolios.

“Banca Generali and Banca Generali Fund Management Luxembourg are getting to know right now of the mentioned bad news,” the company said. It “rel[ied] on the notion that the transaction was eligible when [they] entered the securitised portfolio”, it added in an emailed statement.

CFE said it had never knowingly purchased any assets linked to criminal activity. It added that it conducted significant due diligence on all the healthcare assets that it handled as a financial intermediary, and that it also relied on the checks of other regulated professionals who handled the invoices after their creation in Calabria.

Both companies said that any legal issues that emerged after the invoices had been acquired were immediately reported to the Italian authorities. CFE said that the total amount of invoices later revealed to be linked to organised crime made up a very small proportion of the total amount of assets it had handled connected to the Italian health systems.

EY, which was not required to conduct due diligence on the assets in the securitisation when providing consulting services for the structuring for one of the vehicles purchased by Banca Generali, declined to comment.

Guardian News published July 1, 2020: Italian police seize £900m of 'Isis drug' fenethylline en route from Syria. Police in Italy have seized more than 84m fenethylline tablets, weighing 14 tonnes, at the port of Salerno, in what they say is the biggest seizure of amphetamines in the world. Fenethylline is known by some as the 'Isis drug' after investigations found it was used by Islamic State fighters during battles and sold by the group for profit

The Guardian, UK
written by Lorenzo Tonda
Wednesday July 1, 2020

Police in Italy have claimed the biggest seizure of amphetamines in the world, intercepted en route from Syria to European markets where synthetic drug production may have taken an unexpected hit from lockdown.

More than 84m Captagon tablets, weighing 14 tonnes and with a value of more than €1bn (£900m), were hidden in large paper and steel cylinders and transported to the port of Salerno, southern Italy, where they were seized by the police.

“Fourteen tons of amphetamine could not have been destined for Italy alone,” said Col Domenico Napolitano, the commander of the Guardia di Finanza of Naples, who led the operation.

“We believe that, during the Covid-19 lockdown, the production and distribution of synthetic drugs in Europe practically ground to a halt and therefore many traffickers have turned to Syria, where production does not seem to have slowed down during the pandemic,” he said.

Captagon is known by some as the “Isis drug” after investigations revealed the amphetamine was both used by Islamic State’s fighters to keep them on their feet during battles and by the group to sell for profit.

“The amphetamine pills we seized had a symbol on them,” said Napolitano. “Two half-moons – the same symbols found on the Captagon seized in the Isis hideouts in the Middle East. It is the same symbol found on the tablets the terrorists consumed before the attack on the Bataclan in Paris in 2015.

“We have been following this investigation for some time and we believe that the drugs seized in Salerno may have been produced by men linked to Daesh [Isis] in order to finance the jihad.”

Captagon, the trademark name for the synthetic stimulant fenethylline, was first produced in the 1960s to treat hyperactivity, narcolepsy and depression, but was banned in most countries by the 1980s as it was deemed too addictive.

It remains hugely popular in the Middle East and Saudi Arabia alone seizes 55m tablets a year, perhaps 10% of the total thought to be smuggled into the kingdom.

The drug is cheap and simple to produce, using ingredients that are easy and often legal to obtain, yet sells for up to £16 a tablet.

Police believe the Salerno shipment was to be received by the mafia. “It is clear the hand of the Neapolitan mafia, the Camorra, is behind drug trafficking of such proportions,” Napolitano said. “A billion-euro drug load cannot arrive in a port without the knowledge of the mafia.”

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