ARCHIVED U.S. Department of Justice National Drug Intelligence Center South Florida High Intensity Drug Trafficking Area Drug Market Analysis 2010 This document may contain dated information. It has been made available to provide access to historical materials. ARCHIVED This document may contain dated information. It has been made available to provide access to historical materials. ARCHIVED U.S. Department of Justice National Drug Intelligence Center 2010-R0813-030 May 2010 South Florida High Intensity Drug Trafficking Area Drug Market Analysis 2010 This assessment is an outgrowth of a partnership between the NDIC and HIDTA Program for preparation of annual assessments depicting drug trafficking trends and developments in HIDTA Program areas. The report has been coordinated with the HIDTA, is limited in scope to HIDTA jurisdictional boundaries, and draws upon a wide variety of sources within those boundaries. This document may contain dated information. It has been made available to provide access to historical materials. ARCHIVED ii South Florida High Intensity Drug Trafficking Area This document may contain dated information. It has been made available to provide access to historical materials. ARCHIVED Table of Contents Strategic Drug Threat Developments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 HIDTA Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Drug Threat Overview. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Drug Trafficking Organizations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Production. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Transportation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Drug-Related Crime . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Abuse. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Illicit Finance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Outlook. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Sources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Drug Market Analysis 2010 iii This document may contain dated information. It has been made available to provide access to historical materials. ARCHIVED iv South Florida High Intensity Drug Trafficking Area This document may contain dated information. It has been made available to provide access to historical materials. ARCHIVED Strategic Drug Threat Developments The most significant drug threats to the South Florida High Intensity Drug Trafficking Area (HIDTA) region are the diversion, distribution, and abuse of controlled prescription drugs (CPDs), the distribution and abuse of cocaine, and indoor cannabis cultivation and subsequent distribution and abuse of marijuana. Rising heroin availability and abuse pose a serious threat as well. Local methamphetamine production is an emerging threat to the region. In addition, the South Florida HIDTA region is a major venue for laundering and moving billions of dollars in illicit drug proceeds, particularly through the Colombian Black Market Peso Exchange (BMPE) and bulk cash smuggling. The following are significant strategic drug threat developments in the South Florida HIDTA region: • The South Florida HIDTA region is a significant source area for CPDs, particularly opioid pain relievers,a diverted for distribution throughout much of the eastern United States. The hundreds of pain management clinics operating in Broward, Miami-Dade, and Palm Beach Counties attract drug seekers from many states, including Kentucky, New Jersey, Ohio, Tennessee, and West Virginia. The region is expected to remain a source area for CPDs in the near term, until statewide legislation aimed at curbing diversion from pain management clinics is successfully implemented. • National Drug Intelligence Center (NDIC) analysts expect that if actions to curb CPD diversion from pain management clinics in South Florida are successful, and the supply of prescription opioid pain relievers is disrupted, many prescription opioid users will switch to heroin. Heroin availability and abuse are low but increasing in the South Florida HIDTA region. Rising heroin availability is evidenced by increased heroin purity from 2007 through 2008, which may also have contributed to an observed increase in heroin-related deaths in the same period. In addition, the Center for the Study and Prevention of Substance Abuse (CSPSA) reports that an opiate epidemic involving prescription opioid pain relievers and heroin looms on the horizon for the new decade in Broward and Miami-Dade Counties. • Cocaine availability fluctuated in some parts of the South Florida HIDTA region in 2009 but remained at levels sufficient to support market demand. The Drug Enforcement Administration (DEA) Miami Field Division (MFD) reported lower cocaine availability and higher kilogram prices in the Greater Miami area at year-end 2009 than at year-end 2008. • Increased law enforcement efforts against urban, residential, indoor cannabis grow operations in the South Florida HIDTA region caused many growers to relocate their grow sites to suburban and rural communities (sometimes outside the South Florida HIDTA region), where they are harder to detect. Local cannabis cultivators are expected to continue to move their operations to areas that better shield their operations from law enforcement interdiction. • NDIC analysts anticipate the emergence of small-scale methamphetamine production in the region because of the local pseudoephedrine smurfingb occurring there and a rise in methamphetamine production in other areas of Florida. a. Opioid pain relievers include codeine, fentanyl (Duragesic, Actiq), hydromorphone (Dilaudid), meperidine (Demerol), morphine (MS Contin), oxycodone (OxyContin, Roxicodone), methadone (Dolophine), and hydrocodone combinations (Vicodin, Lortab, and Lorcet). b. Pseudoephedrine smurfing is a method used by some methamphetamine traffickers to acquire large quantities of precursor chemicals. Methamphetamine producers purchase the chemicals in quantities at or below the legal thresholds from multiple retail locations. Methamphetamine producers often enlist the assistance of several friends or associates in smurfing operations to increase the speed of production and the quantity of chemical acquired. Drug Market Analysis 2010 1 This document may contain dated information. It has been made available to provide access to historical materials. ARCHIVED Figure 1. South Florida High Intensity Drug Trafficking Area § ¦ ¨ 95 £ ¤ (Flor ida Tu rn 27 £ ¤ £ ¤ £ ¤ 441 £ ¤ 1 98 17 AT LA N TIC OC E A N pik e) § ¦ ¨ Lake Okeechobee 95 £ ¤ 27 n o " £ ¤ 98 § ¦ ¨ PALM BEACH INTERNATIONAL PALM BEACH § ¦ ¨ £ ¤ 95 £ ¤ 27 441 £ ¤ 41 (E verglades Pkwy) nFort Lauderdale o " § ¦ ¨ 75 ! FT. LAUDERDALE-HOLLYWOOD INTERNATIONAL BROWARD 41 MONROE MIAMI-DADE (Florida Turnpike) £ ¤ MIAMI INTL ! Hialeah l o r i d a 75 o " Miami n Major City* 350,000 + s o f F Everglades National Park r a i t 250,000 - 349,999 £ ¤ 1 KEY WEST INTERNATIONAL o " n S t ! n o " 150,000 - 249,999 Major Seaport International Airport Interstate Limited Access U.S. Highway National Park HIDTA County * By Census 2000 Population 2 South Florida High Intensity Drug Trafficking Area This document may contain dated information. It has been made available to provide access to historical materials. ARCHIVED HIDTA Overview The South Florida HIDTA region comprises Broward, Miami-Dade, Monroe, and Palm Beach Counties. (See Figure 1 on page 2.) The region is the principal arrival zone for multiton quantities of cocaine, marijuana, and multikilogram quantities of heroin transported through the Caribbean corridor into the continental United States. The region is also a distribution center for cocaine, heroin, high-potency marijuana, and CPDs intended for distribution in many states, including Kentucky, New Jersey, Ohio, Pennsylvania, Tennessee, and West Virginia, as well as the New England region. The South Florida HIDTA region is also a major venue for laundering and moving billions of dollars in illicit drug proceeds. The South Florida HIDTA region is a large, multiethnic, densely populated metropolitan area with a diversified economy based on tourism, manufacturing, import/export businesses, banking, and information technology. The region has a highly developed transportation infrastructure composed of seaports, airports, and roadways with links to drug source and transit areas as well as eastern U.S. drug markets. Drug traffickers routinely exploit this infrastructure to transport illicit drugs into, through, and from the region to other drug markets in Florida and the eastern United States. Drug Threat Overview The diversion, distribution, and abuse of CPDs, the distribution and abuse of cocaine, and the cultivation of cannabis and subsequent distribution and abuse of marijuana are the principal drug threats to the South Florida HIDTA region. According to the NDIC National Drug Threat Survey (NDTS) 2010,c 19 of the 40 law enforcement respondents in the South Florida HIDTA region identify CPDs as the drug that poses the greatest threat to their jurisdictions, 12 identify cocaine, and 7 identify marijuana. In 2009, South Florida HIDTA initiatives reported the seizure of over 700,000 dosage units of CPDs, 12,700 kilograms of cocaine, and 9,000 kilograms of marijuana.d (See Table 1 on page 4.) The South Florida HIDTA region is a significant source area for the diversion of CPDs, particularly opioid pain relievers. Distributors and abusers travel from states such as Kentucky, Ohio, Tennessee, and West Virginia to obtain these drugs from the large number of pain management clinics operating in Broward, Miami-Dade, and Palm Beach Counties. The threat posed by CPDs is enhanced by the high levels of availability and abuse reported by treatment providers in the region. CPDs are available at high to moderate levels in 36 of the 40 responding law enforcement jurisdictions in the South Florida HIDTA region. The most widely available and commonly abused CPDs in the region include alprazolam (Xanax), diazepam (Valium), hydrocodone (Vicodin), hydromorphone (Dilaudid), methadone, morphine, and oxycodone (OxyContin), as well as anabolic steroids. c. NDTS data for 2010 cited in this report are as of March 3, 2010. NDTS data cited are raw, unweighted responses from federal, state, and local law enforcement agencies solicited through either the NDIC or the Office of National Drug Control Policy (ONDCP) HIDTA program. Data cited may include responses from agencies that are part of the NDTS 2010 national sample and/or agencies that are part of HIDTA solicitation lists. d. Drug seizures reported by the South Florida HIDTA are significantly higher than drug seizures reported for all of Florida. The Federal-wide Drug Seizure System data, run on March 18, 2010, indicate that 13,457.3 kilograms of marijuana, 6,565.2 kilograms of cocaine, 70.2 kilograms of heroin, 59.7 kilograms of methamphetamine, and 4.3 kilograms and 32,625 dosage units of MDMA were seized in Florida in 2009. The South Florida HIDTA reports that its seizure data most accurately reflects its efforts in the region. Drug Market Analysis 2010 3 This document may contain dated information. It has been made available to provide access to historical materials. ARCHIVED Cocaine availability fluctuated in some areas of the South Florida HIDTA region in 2009, but remains at levels sufficient to support local demand and supply a number of drug markets in Florida and some areas in the eastern United States such as Philadelphia, Pennsylvania, and the New England region. Some areas experienced lower cocaine availability in 2009; in particular, the DEA MFD reported lower cocaine availability and higher kilogram prices in the Greater Miami area. Cocaine prices in the Miami area increased from $15,250 to $17,500 per kilogram at year-end 2008 to $24,000 to $35,000 per kilogram at year-end 2009. Nonetheless, cocaine prices were relatively stable at $700 to $1,300 per ounce and $100 per gram in the Miami area from year-end 2008 to year-end 2009. Lower cocaine availability in some parts of South Florida is attributed to several factors, including effective counterdrug operations in the South Florida HIDTA region, decreased cocaine production in Colombia, expanded cocaine markets in Europe and Africa, and increased law enforcement efforts in Mexico. High-potency marijuana is widely available in the South Florida HIDTA region because of the numerous large-scale indoor cannabis grow operations operated primarily by Cuban and Hispanic DTOs and criminal groups. Much of the high-potency marijuana produced at these sites is sold throughout Florida as well as much of the eastern United States. Commercial-grade marijuana produced locally at outdoor grow sites and transported from the Bahamas, Colombia, Jamaica, and Mexico is also widely available in the region. Heroin availability and abuse are low but increasing in the region. Rising heroin availability in the South Florida HIDTA region is evidenced by increased heroin purity from 2007 through 2008, which contributed to an observed increase in the number of heroin-related deaths during that period. Most of the heroin available in the South Florida HIDTA region is South American (SA). According to CSPSA, trends over the past few years suggest that nonmedical prescription opioid use is occurring among heroin users in Broward and Miami-Dade Counties. The CSPSA links both heroin and prescription opioids in an expansion phase of what they call the new opiate epidemic. The demand for methamphetamine in the region is typically low and generally satisfied by Mexican ice methamphetamine distributed by local independent dealers with ties to Atlanta-based Mexican DTOs. Nonetheless, small-scale methamphetamine production is expected to emerge in the South Florida HIDTA region (see Production section on page 5). MDMA (3,4-methylenedioxymethamphetamine, also known as ecstasy) poses a low threat to the South Florida HIDTA region. MDMA is readily available in the region and continues to be transported into the region overland by vehicle from Canada. Most of the MDMA transported into the region is intended for local consumption and is distributed primarily by African American, Caucasian, Hispanic, and Jamaican traffickers. Table 1. South Florida HIDTA Initiative Seizures, by Drug, in Kilograms, 2009 Drug Powder cocaine 2009 12,731 Crack cocaine 7 Ice Methamphetamine 5 Powder Methamphetamine 3 MDMA (in dosage units) Marijuana (Bulk, non-hydroponic) Hydroponic Marijuana (plants) Heroin Hydrocodone (in dosage units) 60,173 9,225 15,663 59 8,714 OxyContin (in dosage units) 94,448 Xanax (in dosage units) 23,682 Other CPDs* (in dosage units) 600,490 Source: South Florida High Intensity Drug Trafficking Area. *Other CPDs include steroids. 4 South Florida High Intensity Drug Trafficking Area This document may contain dated information. It has been made available to provide access to historical materials. ARCHIVED Drug Trafficking Organizations Colombian and Mexican DTOs are the principal suppliers of wholesale quantity drugs in the South Florida HIDTA region. They supply most of the available illicit drugs in the HIDTA region to African American, Caucasian, Cuban, Dominican, Haitian, Hispanic, Jamaican, and Puerto Rican distributors, and to street gang members. Colombian DTOs, the dominant wholesale traffickers in the South Florida HIDTA region, supply a large portion of the wholesale-level cocaine and SA heroin available in the South Florida HIDTA region, relying heavily on Bahamian, Cuban, Dominican, Haitian, Puerto Rican, and Venezuelan DTOs and criminal groups to transport these drugs through transit areas in the Caribbean. Colombian DTOs in the South Florida HIDTA region also work with Mexican DTOs to coordinate the transportation of powder cocaine from Colombia through Central America and Mexico into the United States, and eventually into Florida. Mexican DTOs supply wholesale quantities of cocaine and marijuana, and lesser quantities of heroin and methamphetamine available in the South Florida HIDTA region. They obtain illicit drugs from Mexican DTOs in southwestern states and Atlanta, Georgia. For example, in November 2009, law enforcement officers arrested members of a Mexican DTO in Palm Beach County and seized kilogram quantities of cocaine and approximately $500,000 in U.S. currency. The cocaine was obtained from a source of supply located near the Southwest Border and sold to midlevel and retail-level distributors in Palm Beach County. Production Large-scale, indoor cannabis grow operations pose the most significant drug production threat to the South Florida HIDTA. According to 2010 NDTS data, 27 of 40 law enforcement agency respondents in the South Florida HIDTA region report that marijuana is produced at indoor grow sites in their jurisdictions. Indoor cultivators produce high-potency marijuana because it yields more money than commercial-grade marijuana. For example, hydroponic marijuana sold for $2,500 to $5,000 per pound and commercial-grade marijuana sold for $650 to $1,300 per pound in the South Florida HIDTA area during the first half of 2009. Indoor cannabis is cultivated primarily by Cuban and Hispanic DTOs, as well as members of various criminal groups and independent dealers, including Asians and Caucasians. Increased law enforcement efforts against urban residential indoor grow operations in the South Florida HIDTA region in 2008 caused many growers to relocate their grow sites to suburban and rural communities (sometimes outside the South Florida HIDTA region), where they are harder to detect. In addition, some growers have become more sophisticated and have adapted to law enforcement efforts by using countersurveillance techniques and establishing grow sites in areas that limit surveillance by law enforcement. For example, some growers have established grow houses in the Redlands area of Miami-Dade County, where homes are located in remote areas and have distant setbacks from the road, which limits law enforcement surveillance. The difficulty in detecting these operations appears to be reflected in 2009 seizure data that show a decrease in the number of indoor grow sites seized in the South Florida HIDTA region.e (See Table 2 on page 6.) Law enforcement officers report that decreased eradication and seizures are not indicative of decreased production in the region and that they continue to seize indoor grow operations in the region. For example, in December 2009, the U.S. Attorney’s Office, Southern District of Florida, announced the results of a law enforcement operation that targeted indoor marijuana grow operations in Miami-Dade, Monroe, Broward, Collier, Lee, Henry, Highlands, Okeechobee, and Marion Counties. This operation, coordinated by the South Florida HIDTA, resulted in the seizure of 1,937 marijuana plants, 13.6 kilograms of processed marijuana, 25 firearms, $185,200 in U.S. currency, and the arrest of 43 individuals involved in 40 residential hydroponic marijuana grow sites. e. South Florida HIDTA officials report that some law enforcement agencies in the region do not report all eradication data to the Domestic Cannabis Eradication/Suppression Program (DCE/SP). Drug Market Analysis 2010 5 This document may contain dated information. It has been made available to provide access to historical materials. ARCHIVED Table 2. Indoor Cannabis Cultivation Sites Seized and Plants Eradicated in South Florida HIDTA Counties 2005–2009 2005 HIDTA County Broward 2006 Sites Plants Seized Eradicated 2007 2008 Sites Seized Plants Eradicated Sites Seized Plants Eradicated Sites Seized 2009 Plants Eradicated Sites Seized Plants Eradicated 31 2,669 33 3,021 30 1,906 11 1,333 10 1,523 157 12,016 206 15,749 382 26,019 348 23,621 340 20,223 5 501 0* 0* 2 27 0 0 0 0 Palm Beach 29 2,356 26 1,938 36 3,727 79 4,997 41 2,887 Total HIDTA 222 17,542 265 20,708 450 31,679 438 29,951 391 24,633 Total Florida 384 45,217 511 37,311 944 74,698 1,022 78,489 863 55,378 Miami-Dade Monroe Source: Domestic Cannabis Eradication/Suppression Program. * Monroe County did not participate in the program in 2006. NDIC analysts anticipate the emergence of small-scale methamphetamine production in the region in 2010 because of the local pseudoephedrine smurfing occurring within the region and increased methamphetamine production in other areas of Florida. The South Florida HIDTA Intelligence Center reports pseudoephedrine smurfing being noted in Broward, Miami-Dade, and Palm Beach Counties. Quantities purchased by the noted smurfers are sufficient to produce methamphetamine for personal use and limited retail distribution.f Methamphetamine production has been very limited in the South Florida HIDTA region. According to 2010 NDTS data, 21 of 40 law enforcement agency respondents report that methamphetamine is produced at moderate to low levels in their jurisdictions. Moreover, National Seizure System (NSS) data show that no methamphetamine laboratories were seized in the region from 2007 through 2009. However, NSS data indicate that the number of methamphetamine laboratories seized statewide increased from 96 in 2008 to 215 in 2009. Law enforcement officers report that the one-pot or “shake and bake” production method is gaining popularity in Florida and is expected to become the production method of choice in the South Florida HIDTA region. (See text box.) One-Pot or “Shake and Bake” Methamphetamine Production A one-pot cook is a variation of the lithium ammonia method of production—also commonly referred to as the “Nazi” method. Instead of producing methamphetamine through a series of sequential steps—normally used in the Nazi method—the one-pot method is concluded in a single reaction vessel (typically a 2-liter plastic soda bottle), and all ingredients are mixed together at the outset. The mixture is left to react, naturally producing the necessary ammonia, which then reacts with the lithium metal to convert the pseudoephedrine into methamphetamine. Like all clandestine methamphetamine production operations, the one-pot method is dangerous because the reactions are volatile and difficult to control. Transportation Drug traffickers routinely exploit the South Florida HIDTA region’s highly developed transportation infrastructure to move illicit drugs and drug proceeds into, through, and from the region. (See Figure 1 on page 2.) Traffickers use two principal corridors—the southern corridor and the northern corridor—to transport illicit drugs into the region. (See Figure 2 on page 7.) f. It is currently unknown if the pseudoephedrine obtained through smurfing in the South Florida HIDTA region is destined for methamphetamine production within or outside the South Florida HIDTA region; however, it is likely that at least some of the pseudoephedrine obtained in the region is intended for local methamphetamine production. 6 South Florida High Intensity Drug Trafficking Area This document may contain dated information. It has been made available to provide access to historical materials. ARCHIVED Figure 2. South Florida HIDTA Transportation Corridors OK NM AR Atlanta MS TX AL SC A T L A N T I C O C E A N GA LA FL G u l f o f M e x i c o Miami MEXICO U.S. VIRGIN ISLANDS CUBA HAITI DOMINICAN REPUBLIC JAMAICA C a r i b b e a n BELIZE P A C I F I C O C E A N Arrows represent general drug movement GUATEMALA EL SALVADOR Hispaniola PUERTO RICO S e a Lesser Antilles HONDURAS NICARAGUA COSTA RICA VENEZUELA PANAMA COLOMBIA BRAZIL Colombian and various Caribbean-based traffickers transport cocaine, heroin, and marijuana through the southern corridor from source and transit areas in South America and the Caribbean to South Florida using couriers on commercial flights; maritime conveyances such as container ships, cruise ships, commercial fishing vessels, and recreation vessels; and package delivery services. For example, in July 2009, U.S. Coast Guard officers seized a substantial amount of marijuana from a fishing vessel in the Miami area. Officers reported that the Cuban suspect obtained the marijuana in the Bahamas. Mexican DTOs, and to a much lesser degree other multiethnic traffickers, transport cocaine and Mexican commercialgrade marijuana, as well as lesser quantities of heroin and methamphetamine through the northern corridor from the Southwest Border area and Atlanta to the South Florida HIDTA region. They use overland means, primarily private and commercial vehicles, on Interstates 75 and 95, and to a lesser extent, package delivery services. For example, in January 2010, a sheriff’s deputy in Harrison County, Mississippi, stopped a Texas-registered vehicle heading east on I-10 and found 4 pounds of cocaine. The driver of the vehicle, an illegal alien from Panama residing in Miami, was en route to Miami. The passenger was a naturalized U.S. citizen from Mexico residing in Mission, Texas. Distribution Colombian and Mexican DTOs supply most of the available illicit drugs in the South Florida HIDTA region to African American, Caucasian, Cuban, Dominican, Haitian, Hispanic, Jamaican, and Puerto Rican distributors, and to street gang members. Midlevel and retail-level drug distribution typically occurs at open-air drug markets; in clubs, apartment buildings, motels, and vehicles; on beaches; and at prearranged meeting sites such as parking lots. An estimated 371 street gangs, primarily locally based gangs such as 22 Avenue Boys, Dog Pound Gangsters, and Graveyard Boyz with more than 15,000 members and associates, operated in the South Florida HIDTA region in 2009. Locally based gangs are loosely structured and profit-driven. Most of their profits are made through the distribution of illicit drugs. Other criminal gang activities used to raise funds include home invasions, robbery, and auto theft. Many of these gangs are composed of individuals of various ethnicities, although more traditional, ethnic-based gangs are Drug Market Analysis 2010 7 This document may contain dated information. It has been made available to provide access to historical materials. ARCHIVED also present, particularly in Haitian and Jamaican communities. Some national-level street gang members, such as the Latin Kings, also operate in Miami-Dade County, according to the Regional Organized Crime Information Center. The South Florida HIDTA region is a significant source area for CPDs, particularly opioid pain relievers, diverted for distribution throughout a large portion of the eastern United States, mainly supplied from the growing number of pain management clinics in the region.g A Florida grand jury found that from 2007 through 2009, the number of pain management clinics in Broward and Palm Beach Counties increased dramatically from 4 to 155. In one 6-month period, doctors at these pain clinics dispensed more than 9 million tablets of oxycodone. The grand jury found that the Broward and Palm Beach County clinics attract drug seekers from Kentucky, Ohio, Tennessee, and West Virginia. Large Quantity of Roxicodone Seized In November 2009, the DEA MFD and the South Florida HIDTA Southeast Florida Regional Task Force received information that an individual from New Jersey traveled to South Florida to obtain a large quantity of CPDs from a local pain management clinic. Law enforcement officers made contact with the individual and found five Ziploc™ bags that contained approximately 10,000 dosage units of Roxicodone. The individual planned to sell most of the Roxicodone in New Jersey. Drug-Related Crime Most of the drug-related violent crime in the South Florida HIDTA region is committed by street gang members to protect their distribution operations. Law enforcement officials in the region report that high levels of violence by street gang members over the past several years led to increased law enforcement action against the gangs, some of which were dismantled. For example, in April 2009, federal and local law enforcement officers dismantled the 68th Street gang, a Miami-based street gang that was responsible for distributing multikilograms of cocaine and committing at least 23 homicides in South Florida since at least 2006. Some street gang members have realized that law enforcement agencies focus on the most violent street gangs, causing many to lower their level of violence to avoid law enforcement scrutiny. Drug-related property crime in the region is typically committed by abusers seeking funds to sustain their addictions. Abuse Abuse of cocaine, marijuana, methamphetamine, and other drugs remained relatively unchanged in 2009 throughout most of the South Florida HIDTA region. The CSPSA reports that cocaine abuse appears to be entering a declining phase in Broward and Miami-Dade Counties. Moreover, treatment providers report that many drug abusers in the area are opportunistic, switching from one drug to another, depending on price and availability. Some opioid abusers use prescription opioids or heroin, depending on availability and the price of each drug. Treatment providers report that some prescription opioid abusers are switching to heroin because heroin is less costly or more available in some areas than prescription opioids. For example, successful efforts to shut down some pain management clinics in the region made some prescription opioids harder to obtain, causing abusers to switch to heroin. According to CSPSA, an opiate epidemic involving opioid pain relievers and heroin looms on the horizon for the new decade in Broward and Miami-Dade Counties. In addition, Florida medical examiner data indicate that the number of deaths associated with heroin, used alone or with other drugs, increased from 40 in 2007 to 63 in 2008, and that prescription drugs were present or found to be a causal factor in deaths more often than other illicit drugs in 2008 (the latest full year that data are available). g. In July 2009, Florida enacted a law establishing a prescription drug monitoring program. The law requires that pain management clinics register with the Department of Health and that state medical and osteopathic medicine boards set standards of practice for all physicians and osteopaths who prescribe controlled substances from those clinics. 8 South Florida High Intensity Drug Trafficking Area This document may contain dated information. It has been made available to provide access to historical materials. ARCHIVED Illicit Finance The South Florida HIDTA region is a major venue for laundering and moving billions of dollars in illicit drug proceeds, particularly through the Colombian BMPE and bulk cash smuggling. Colombian DTOs are the primary money launderers in the region. They routinely launder illicit drug proceeds through the BMPE by exploiting businesses such as local financial institutions, money remittance businesses, shell corporations, and computer exporters. Traffickers and money laundering facilitators use various other methods to launder drug proceeds in the South Florida HIDTA region. Some money laundering facilitators use the black market in Venezuela to launder illicit drug proceeds in a system similar to the Colombian BMPE. Facilitators also launder money through mortgage fraud, unabated despite the decline in the housing market. In addition, traffickers launder illicit proceeds by purchasing real estate and luxury items, using money services businesses, structuring bank deposits, commingling drug proceeds with revenue generated by cash-intensive front businesses such as auto repair shops and dealerships, hair salons, and increasingly, using prepaid (stored value) cards (see text box below). Prepaid Cards The use of prepaid cards by drug traffickers is a growing concern for law enforcement agencies in the South Florida HIDTA region. According to NDTS 2010 data, 15 out of 40 law enforcement agency respondents in the South Florida HIDTA region report that money laundering occurs by means of prepaid cards in their jurisdictions. Prepaid cards are payment mechanisms that allow cardholders to access global credit and debit payment networks without forming a traditional accountholder relationship with a depository institution, and to obtain the cards using stolen or fraudulent identities. These factors create a functional anonymity that could enable money launderers to engage in transactions that were previously available only to identified customers with traditional banking relationships. South Florida HIDTA investigators report that prepaid cards are used in connection with bulk cash smuggling and suspect that they are used to purchase goods within the BMPE system. Traffickers can also pay workers, members, or associates by loading prepaid cards with money in the name of fictitious employees through front companies, thereby avoiding traditional bank accounts. Absent regulatory requirements for prepaid cards, the true extent of their use in money laundering remains an intelligence gap. Outlook NDIC analysts expect Colombian and Mexican DTOs to remain the principal wholesale drug traffickers in the South Florida HIDTA region. Other multiethnic traffickers will also continue to have a significant role in drug distribution, as will street gangs. The region is expected to remain a source area for CPDs in the near term, until statewide legislation aimed at curbing diversion from pain management clinics is successfully implemented. NDIC analysts expect that if actions to curb diversion from pain management clinics in South Florida are successful, and the supply of prescription opioid pain relievers is disrupted, many prescription opioid users will switch to heroin. Cocaine availability in the South Florida HIDTA region is expected to remain at levels sufficient to support market demand. Local cannabis cultivators will continue to move more of their indoor grow sites away from urban areas to suburban and rural areas in order to better shield themselves from law enforcement interdiction. Small-scale methamphetamine production is expected to emerge in the South Florida HIDTA region, with the one-pot production method becoming the production method of choice. Drug Market Analysis 2010 9 This document may contain dated information. It has been made available to provide access to historical materials. ARCHIVED Sources Local, State, and Regional City of Miami Police Department Narcotics Division Drug Interdiction Unit State of Florida Department of Children and Families Broward County Substance Abuse and Mental Health Program Department of Law Enforcement Domestic Marijuana Eradication Program Highway Patrol Contraband Interdiction Unit Medical Examiners Commission Office of Drug Control Federal Executive Office of the President Office of National Drug Control Policy High Intensity Drug Trafficking Areas Gulf Coast South Florida U.S. Department of Justice Drug Enforcement Administration Caribbean Field Division El Paso Intelligence Center National Seizure System Miami Field Division Fort Lauderdale District Office U.S. Attorneys Office Southern District of Florida Other The Palm Beach Post Regional Organized Crime Information Center Questions and comments may be directed to Southeast/Florida/Caribbean Unit, Regional Threat Analysis Branch National Drug Intelligence Center 319 Washington Street 5th Floor, Johnstown, PA 15901-1622 • (814) 532-4601 NDIC publications are available on the following web sites: INTERNET www.justice.gov/ndic ADNET http://ndicosa.adnet.sgov.gov RISS ndic.riss.net LEO https://www.leo.gov/http://leowcs.leopriv.gov/lesig/ndic/index.htm 062210 This document may contain dated information. It has been made available to provide access to historical materials.