ORGANISED CRIME

Study report « Counterfeit medicines and Organized crime »
Conterfeit medicines: the new face of organized crime
25-sept.2013 – A new study of IRACM analyzes new criminal
strategies in connection with counterfeit medicines trafficking.

The link between fake drugs and organized crime is well established: the large scale traffic of falsified medicines is a financial bonanza for the mafia and terrorist networks around the world. It’s a health scourge and constitutes an indirect and more violent threat to the physical integrity of millions of people and to national security around the world.

Moreover, the impact of such trafficking is considerable for the economy. It contributes strongly to curbing the development of emerging countries.

There are two major international definitions of organized crime:

  • In 1998, the Council of the European Union defined a criminal organization as a “structured association, established over a period of time, of more than two persons, acting in a concerted manner, with a view to committing offences which are punishable by deprivation of liberty or a detention order of a maximum of at least four years or a more serious penalty, whether such offences are an end in themselves or a means of obtaining material benefits and where appropriate, of improperly influencing  the operation of public authorities”.
  • The UN Convention of 15 November 2000, otherwise known as the “Palermo Convention” on organized transnational crime, sets the “organized criminal group” as “a structured group of three or more persons existing for a period of time and acting in concert with the aim of committing one or more serious crimes or offences […] in order to obtain, directly or indirectly, a financial or other material benefit”. 

Whatever the definition, most often false drug trafficking meets point by point with their common criteria:

  • involvement of several persons.
  • existence of a real structure in the group,
  • seriousness of the offences committed or planned,
  • stability in time of the criminal activity.

1. Organization and methods of traffickers 

While small isolated traffickers engaged in highly localized illicit sales do exist, large scale fake drugs trafficking as it is observed today requires considerable financial and human means.

So much so that only structured networks can have access to them.

Many official reports issued by police, intelligence or justice services in different countries have established this connection between all forms of counterfeiting and organized criminal groups.

“All these techniques and the indirect routes taken by many shipments are similar to methods used by drug traffickers, which clearly indicates the type of organizations with whom we are confronted”. Laszlo Kovacs, European Commissioner responsible for taxation and Union Customs (2005)

These links are supported by the following observations:

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2. A single motivation: the extreme profitability of trafficking

Whatever their sources, most of the figures advanced attest to the extreme profitability of fake drugs trafficking.

To give an example: for $1000 invested, the trafficking of counterfeit currency or of heroin would bring a return of $20,000, of counterfeit cigarettes, $43,000, and counterfeit drugs, between $200,000 and $450,000.

Counterfeit drugs would therefore be 10 to 25 times more profitable than the trafficking of narcotics.

Such figures associated with the weakness of the penalties incurred enable to understand why international traffickers prefer to forgo other forms of fraudulent activities to concentrate on counterfeit drugs. 

3. The destabilization of national economies in the medium and long term

Some estimates have established that in 2010 the world market for fake drugs had reached $75 billion. 

Proven or not, this figure shows that the economic shortfall is huge for all stakeholders.

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4. A Serious Impact on Health 

Indirectly, the States are also victims of this traffic when they have to palliate the public health problems caused by false drug trafficking: direct poisoning, rise in the mortality rate due to non-treated diseases, spread of diseases resistant to treatments, etc.

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