War through pharmaceuticals: how terrorist organizations are turning to counterfeit medicine to fund their illicit activity.

AuthorCannon, Douglas T.

The current international framework is ill equipped to proactively handle the growing threat terror organizations play on the international pharmaceutical industry. Globally, there lacks a true enforcement mechanism that can both proactively thwart these offenses, but also retroactively prosecute the offenders. Our typical image of terrorism is a group of masked men opening fire on a crowded area, or detonating improvised explosive devices to harm hundreds or thousands of innocent civilians. But what if terrorists became so advanced that they were able to harm millions, without their targets ever knowing? Imagine taking over-the-counter pain medication to relieve your horrible sinus pressure, but unbeknownst to you, that medicine had been tainted with Cyanide. While that example is horribly graphic-it is a real example of what many call a chilling display of domestic terrorism. Similarly, what if that generic Viagra being sold was secretly produced by Hizballah and used to finance its ongoing terror operations globally. Experts have warned the pharmaceutical industry that they are vulnerable to terror threats, little has pragmatically been done. This Note proposes a new International Task Force, which will have both the authority to seek out these offenders, use force--if needed-to take down these groups, a database to organize this information, and finally, a Treaty establishing counterfeit medicine as a crime. While many Notes detail international responses to terrorism, or global responses to pharmaceuticals, no Note has yet to combine the two very real issues. Providing exposure to this issue, this Note will provide for a unique plan to impede these offenders.

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"The price of freedom is eternal vigilance."--Thomas Jefferson

CONTENTS I. INTRODUCTION II. BACKGROUND- TERROR GROUPS, THEIR FUNDING, AND COUNTERFEIT MEDICINE A. Terror Groups-A Primer 1. Hizballah 2. Real Irish Republican Army (Real IRA) B. Terrorist Financing 1. Operational Costs 2. Organizational Costs 3. How Do Terrorists Finance Their Operations? a. Moving Money b. Earning Money C. Terrorism and Counterfeit Medicine III. CURRENT FRAMEWORK OF COUNTERFEIT MEDICINE A. Domestic Impediments to Counterfeit Medicine 1. The USTR and Counterfeit Medicine 2. The FDA and Counterfeit Medicine 3. The FBI and U.S. Customs and Counterfeit Medicine IV. CRITIQUE OF CURRENT FRAMEWORK OF COUNTERFEIT MEDICINE AND SOLUTION A. International Task Force B. International Database, Regulation, and the Adoption of a Treaty Making the Production of Counterfeit Medicine a Crime IV. CONCLUSION I. INTRODUCTION

In the post-9/11 world, terrorist groups are becoming ever more resourceful in discovering novel techniques to increase funding. (2) One such way is the manufacturing and distributing of counterfeit drugs. (3) As one author noted, "[c]ounterfeiting is a serious problem that transcends law enforcement ... and clearly has entered the realm of terrorism." (4) While others have written about how terror groups finance their operations vis-a-vis the exchange of narcotics, this Note will focus on the illegal production, and sale of pharmaceutical medication, commonly referred to as "Counterfeit Medicine."5 As part of the larger issue of counterfeiting, the World Health Organization ("WHO") in 2006 launched the International Medical Products Anti-Counterfeiting Taskforce ("IMPACT") to "build coordinated networks across and between countries in [o]rder to halt the production, trading and selling of fake medicines around the globe."6

In analyzing the issue of Counterfeit Medicine, its funding of terror, and IMPACT'S mission, it is first important to understand how terror financing has changed in the last decade. Accordingly, Part II of this Note provides a background of this issue, focusing on the terror aspects as they relate to counterfeit medicine. This section focuses on well-known terror groups and their methods of funding. In addition, this section lays the framework for an analysis in the final section detailing a method of preventing these groups from using counterfeit medicine to further proliferate their terror activity. Part III analyzes the current framework of counterfeit medicine. It explores which markets have been affected; who, in the international community, has the authority to act, and who is acting. Part III analyzes the efficacy of the United States government and other countries' task forces in combatting counterfeit medicine, as well as the WHO and their unit- IMPACT. Finally, Part IV provides a critique and a discussion of a possible solution to combating this problem: instituting an international anti-counterfeiting task force akin to the International Anti-Poaching Foundation.

  1. BACKGROUND- TERROR GROUPS, THEIR FUNDING, AND COUNTERFEIT MEDICINE

    Terrorism is defined as "the use of violence and threats to intimidate or coerce." (7) While terrorism is not a recent phenomenon, largely, since the 1980s it has threatened Western existence. (8) In modernity, terrorism has greatly evolved into complex organizations fighting for a common cause. While there is yet to be an organization focused solely on counterfeiting medicine, many current terror organizations have dabbled in this area. The following provides background into the designation of a terror group, how they receive funding, and how these designation's and funding factors relate to counterfeit medicine.

    1. Terror Groups--A Primer

      The U.S. Department of State champions a list of policy determinations and classifications defining a Foreign Terror Organization ("FTO"). (9) In this capacity, the Secretary of State, in accordance with [section]219 of the Immigration and Nationality Act ("INA") designates the group(s) to be added to this list. (10) Section 219 of the INA states that for an organization to be listed:

      1. It must be a foreign organization.

      2. The organization must engage in terrorist activity, as defined in section 212 (a)(3)(B) of the INA (8 U.S.C. [section] 1182(a)(3)(B)), or terrorism, as defined in section 140(d)(2) of the Foreign Relations Authorization Act, Fiscal Years 1988 and 1989 (22 U.S.C. [section] 2656f(d)(2)), or retain the capability and intent to engage in terrorist activity or terrorism.

      3. The organization's terrorist activity or terrorism must threaten the security of U.S. nationals or the national security (national defense, foreign relations, or the economic interests) of the United States. (11)

        Currently, according to the Department of State, there are over forty-five groups listed. (12) These groups include, Hizballah, (13) Abu Sayyaf Group, Al-Shabaab, Al-Qa'ida (and their derivations) as well as non-Islamic groups such as the Real IRA. (14) Both Hizballah and the Real IRA have been linked to counterfeiting medicine, and as such, a brief history of each will be explored. (15)

      4. Hizballah

        Hizballah received its FTO designation in October of 1997. (16) The Department of State characterizes Hizballah as a radical Shia based group, which takes its ideological inspiration from the Ayotollah Kohmeini. (17) Hizballah is often termed the "long arm of Iran." (18) Most recently, the UN Special Tribunal for Lebanon indicted members of Hizballah for the assassination of Lebanese Prime Minister Rafiq al-Hariri, killed by a car bomb in Beirut in 2005. (19)

      5. Real Irish Republican Army (Real IRA)

        The Real IRA received its FTO designation in May of 2001 after forming in 1997 with the express purpose of "removing British forces from Northern Ireland and unifying Ireland." (20) Located in Northern Ireland, the Real IRA is a paramilitary group whose purpose is to reunite "Ireland's 32 counties under an independent Republic of Ireland." (21) It is now believed the RIRA is splintering, focusing more on soft targets while attempting to regroup. (22) Most recently, in March 2013, local authorities foiled an attempted mortar attack by RIRA. (23)

    2. Terrorist Financing

      The prevention of terrorist financing since 9/11 has proved to be quite daunting. (24) One reason is that some of these funds are smuggled via legitimate business networks and charities. (25) The U.S. government is adamant about "starving the terrorists of funding and shutting down the institutions that support or facilitate terrorism." (26) As of 2005, the U.S. government has frozen nearly $200 million in terrorist funds, though over 80% were frozen the first few months after 9/11. (27) Since this time, the U.S., in concert with 36 other countries, organized the Financial Action Task Force on Money Laundering ("FATF"). (28) The prime directive of FATF is to adopt a uniform set of standards regarding money laundering and terrorist financing, that encourage an effective implementation of legal, regulatory and operational measures for these actions which pose a threat to our financial systems. (29)

      Though lacking an enforcement mechanism, countries voluntarily agree to the following conditions, promulgated by FATF, in order to receive membership:

      (1) [B]e fully committed at the political level to implement the 40 recommendations within a reasonable time frame (three years) and to undergo annual self-assessment exercises and two rounds of mutual evaluations; (2) be a full and active member of the relevant FATF-style regional body; (3) be a strategically important country; (4) have already made the laundering of the proceeds of drug trafficking and other serious crimes a criminal offense; and (5) have already made it mandatory for financial institutions to identify their customers and to report unusual or suspicious transactions. (30) The recommendations of FATF have been adopted by the UN, (31) and affirmed by the G-20 in their annual conferences located in Pittsburgh, Seoul, and Cannes. (32) While unable to actively enforce their regulations--due to a lack of proper regulating body, and no true enforcement mechanism--FATF has made meaningful progress since its inception. (33)

      Before delving into how this...

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