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Drug Situation: New York City has long been home to numerous drug trafficking organizations. The city’s large, diverse, multi-class population creates a demand that these organizations are more than willing to serve. New York City also acts as the source for organizations that smuggle drugs to other East Coast destinations and to Canada and Europe.

Cocaine: During 2007, the New York area experienced a fluctuation in cocaine prices and at times, limited cocaine availability. Colombian and Mexican drug trafficking organizations are the primary transporters and distributors of wholesale amounts of cocaine in New York. These traffickers smuggle cocaine to New York in multi-kilogram shipments via tractor-trailers, containerized cargo, and mail services and then distribute the cocaine in smaller amounts through many networks in the metropolitan area. New York City based cocaine distribution organizations also serve as the source of supply to organizations operating throughout the eastern United States. Most of the cocaine entering New York is transported in vehicles and tractor-trailers from large distributions centers in border areas (Arizona, California, Florida, and Texas). In December 2007, Julio Cesar LOPEZ-PENA, a high-ranking member of the notorious Norte Valle Cartel in Colombia who was extradited from Colombia to New York, was found guilty of conspiracy to import cocaine into the U.S. LOPEZ-PENA, participated in the shipment of multi-ton quantities of cocaine, worth an estimated $100 million dollars, to the United States between 1998 and 2003.

Cocaine is also a significant problem in Albany and western New York State. Most cocaine distributors in the Albany area have connections to sources in New York City, but some Albany distributors have direct links with organizations in Florida and Puerto Rico.

Crack cocaine is readily available in economically depressed areas in all major New York cities, along with some suburban and semi-rural areas, and is occasionally a source of violence in upstate cities. Such violence usually occurs when new dealers challenge more established dealers over territory. Crack cocaine is typically transported in the form of powdered cocaine and converted into crack by area distributors.

Heroin: Heroin is readily available from Colombian and Dominican organizations operating in the New York metropolitan area. Most of the heroin available is of South American origin and Colombia-based traffickers bring some of the purest heroin in the world to the streets of New York, utilizing the same distribution methods and money-laundering techniques they perfected in capturing the cocaine market. In some cases, the same organizations are distributing both cocaine and heroin. Much of the Colombian heroin is smuggled into New York by couriers and ingesters arriving at JFK Airport, on direct flights from Colombia, or after stopovers in Central or South America, or the Caribbean. Colombian heroin trafficking organizations have also developed increasingly sophisticated smuggling methods, including use of cargo shipments, soaking heroin into clothing, secreting them in shoes, furniture, and golf bags, as well as chemically impregnating heroin into plastic, which is then molded into common shapes. The heroin is subsequently recovered using chemical extraction processes.

During March 2007, eleven individuals in New York and Colombia were arrested for their participation in one of the largest Colombian heroin trafficking organizations in the United States. DEA estimates that from mid-2006 to the present, the organization was responsible for shipping more than 250 kilograms of heroin from Colombia to the U.S. The investigation, “Operation Eliminacion,” revealed that the traffickers transported their heroin from Colombia to the United States, primarily through Panama and Guatemala. The heroin was concealed in various ways, including inside packages of red kidney beans, which were then resealed in their original cellophane wrappers, inside the beads of beaded beach bags, inside trailer hitches that had been opened and resealed, and inside automotive drive shafts. During the course of the investigation, on seven occasions federal agents seized heroin with a total street value of approximately $24 million.

Colombian heroin is also smuggled to New York via Mexico and then by vehicle from the southwest United States, similar to the cocaine route. The heroin trafficking and abuse problem is increasing in upstate New York. Dealers in upstate regions often buy heroin in New York City and then return to their home areas via auto, bus, or train. Currently, some of the high-purity products are finding their way directly to users who are often unaccustomed to the strength.

In October 2007, Haji Baz MOHAMMAD, the first defendant ever extradited to the United States from Afghanistan, was sentenced to 15 years imprisonment for managing an international narcotics trafficking organization that imported millions of dollars of heroin into the United States.

Methamphetamine: Methamphetamine trafficking and abuse in New York State is a less serious problem when compared to heroin, cocaine, crack, and MDMA. New York has a somewhat bifurcated methamphetamine market. In the New York City area, the market is primarily for crystal methamphetamine. Much of the methamphetamine seen in NYC was produced by Mexico and/or California based Mexican methamphetamine trafficking organizations. The upstate New York market is primarily methamphetamine powder supplied by local clandestine labs. During 2007, NYS experienced a dramatic decrease in methamphetamine laboratories. The New York State Intelligence Center (NYSIC) reported 12 methamphetamine laboratory seizures/incidents in New York in 2007, down from 36 laboratory seizures/incidents reported in 2006.

In March 2007, the New York Field Division (NYFD) arrested William FOUSSE for violating the Combat Methamphetamine Act (CMEA) of 2005 by purchasing over 9 grams of pseudoephedrine in a month’s time. This was the nation’s first arrest for violating the Combat Methamphetamine Act of 2005 .The CMEA of 2005 was signed into law on March 9, 2006 to regulate, among other things, retail over-the-counter sales of ephedrine, pseudoephedrine, and phenylpropanolamine products which are common ingredients found in cough, cold, and allergy products.  Retail provisions of the CMEA include daily sales limits and 30-day purchase limits, placement of product out of direct customer access, sales logbooks, customer ID verification, employee training and self-certification of regulated sellers.  The CMEA was passed because those drugs are precursor chemicals used in the illicit manufacture of methamphetamine or amphetamine.

In June 2007 under Operation PILL CRUSHER, the NYFD announced the arrest of ten individuals charged with crimes related to purchasing in excess of the 9-gram monthly limit of medications containing pseudoephedrine, ephedrine and phenylpropanolamine (Scheduled Listed Chemical Products) as specified by the CMEA of 2005.

Club Drugs:MDMA (Ecstasy) continues to be available throughout New York State. Belgium, the Netherlands and Canada remain the main locations for manufacturing and exporting MDMA. MDMA is smuggled into the U.S. via body carriers, overnight mail and air/sea cargo. Israeli drug traffickers initially dominated the MDMA trade. Due to the large profits to be made from MDMA trafficking, other criminal groups are now importing and distributing significant quantities of MDMA. Asian drug trafficking organizations based in Canada are becoming prominent in the MDMA trade. Other MDMA trafficking groups include, but are not limited to: Dominican traffickers, Russian traffickers, Mexican traffickers, Colombian traffickers, and traditional organized crime groups. Almost all MDMA pills are sold with logos, creating brand names for users to seek out. In August 2007, a U.S Military Officer was sentenced to 17 years in prison for charges relating to the importation of Ecstasy on board a U.S. Air Force plane. Other club drugs, such as GHB and ketamine, while available, are less prominent problems in New York City.

Marijuana: Most of the marijuana entering the New York City area, and some upstate regions, is of Mexican origin, smuggled primarily by auto/truck transport from the Southwestern United States. Traffickers also use containerized cargo and mail/parcel delivery services, such as Federal Express and United Parcel Service to smuggle marijuana into New York. Large shipments of marijuana also arrive in New York from Jamaica, and are then distributed by Jamaican trafficking organizations. High-quality hydroponic marijuana is smuggled into the U.S. from Canada, often via the Akwesasne Mohawk Indian Reservation situated along the U.S./Canadian border. Indoor marijuana grows are becoming more prevalent in the New York City area. Some of these indoor grows are highly sophisticated and are designed to yield substantial quantities of high potency marijuana.

Steroids: Steroids trafficking and steroid abuse continue to be a problem in the New York area. Steroid trafficking groups often use the internet to facilitate their illegal activities. The NYFD contributed to “Operation RAW DEAL”, the largest steroid enforcement action in U.S. history. This international case targeted the global underground trade of anabolic steroids, human growth hormone (HGH) and insulin growth factor (IGF). As part of this investigation, in September 2007, the NYFD seized two underground steroid laboratories in New York called “Bodiez by Design” and “Strong Island Underground” and over 1.1 million dosage units of steroids and ancillary drugs in liquid and pill form. The New York defendants advertised steroids for sale on the Internet and shipped them to customers across the country by mail, directing customers to pay for the steroids in such a way as to mask the parties’ identities and the nature of the transactions.

Khat: Khat is a plant cultivated in Kenya and Ethiopia. The leaves of the plant are usually chewed and held in the cheek. Khat produces feelings of euphoria and stimulation. however side effects include anorexia, heart disease and hallucinations. In July 2006, as part of Operation Somalia Express, law enforcement authorities seized 25 tons of khat worth more than $2 million that was destined for the United States from the Horn of Africa.

Pharmaceutical Diversion: Current investigations indicate that hydrocodone products and OxyContin are the most commonly abused pharmaceutical drugs in the New York area. The most common methods of diversion in New York are: “doctor shopping” (going to a number of doctors to obtain prescriptions for controlled pharmaceuticals), forged prescriptions, and theft. Methadone, benzodiazepines (such as alprazolam and diazepam), and fentanyl were also identified as being among the most commonly abused and diverted pharmaceuticals in New York.

In March 2007, Howard TOCHIK, the owner of TERRACE PHARMACY, was arrested along with 27 other members of a pharmaceutical drug ring operating in Nassau and Queens Counties. TERRACE PHARMACY sold nearly twice the amount Vicodin as the average pharmacy in the United States in 2005 and almost three times more than the average pharmacy in New York State during the same period.

In July, a consent judgment was filed against BELLCO DRUG CORPORATION of North Amityville, New York, a distributor of pharmaceuticals, for failing to report suspicious orders of controlled substances to Internet pharmacies. Pursuant to the terms of the consent judgment, Bellco has paid a civil penalty of $800,000 and has agreed to surrender its DEA registration, which authorized the distribution of controlled substances.

DEA Mobile Enforcement Teams: This cooperative program with state and local law enforcement counterparts was conceived in 1995 in response to the overwhelming problem of drug-related violent crime in towns and cities across the nation. Since the inception of the MET Program, 473 deployments have been completed nationwide, resulting in 19,643 arrests. There have been over two dozen MET deployments in the State of New York since the inception of the program. Locations have included: Niagara Falls, Southampton, Albany, Schenectady, Troy, Amsterdam, Utica, Monticello, Watertown, Poughkeepsie, Newburgh, Mt. Vernon (2), Liberty, Hempstead, Spring Valley, Fallsburg, Geneva, Kingston (2), Middletown, Yonkers, Jefferson County and Montgomery County. In March 2005, the METs prioritized investigations to target and dismantle methamphetamine trafficking organizations and clandestine laboratory operators. In January 2006, the MET concluded a several month long investigation into the methamphetamine activity in the region culminated in the exposure of a methamphetamine lab in Jefferson County. Two individuals were arrested and a second lab was discovered at a remote cabin in Northern Lewis County that resulted in the seizure of 150 grams of a liquid containing methamphetamine and 21 grams of ephedrine, a precursor for the manufacture of methamphetamine. In addition to the eradication of two methamphetamine labs in the north country region, MET members and local police agencies made controlled purchases of narcotics on the streets of Watertown and the surrounding area leading to further arrests and asset seizures. As a result of this investigation, seventeen individuals were arrested on state charges for trafficking narcotics and eleven federal arrests were generated. Eleven properties were searched and seizures included an automobile, a residential home valued at approximately $55,000.00, three weapons and over $16,000.00 in cash. As a result of the efforts of these dedicated agencies, over 194 grams of crack cocaine, with a street value of $19,000.00 was taken off the streets of Jefferson County. In May 2006, the MET concluded a 9-month investigation into the illegal use, sale, manufacture and transportation of illegal drugs in Montgomery County, which resulted in 19 arrests.

DEA Regional Enforcement Teams: This program was designed to augment existing DEA division resources by targeting drug organizations operating in the United States where there is a lack of sufficient local drug law enforcement. This program was conceived in 1999 in response to the threat posed by drug trafficking organizations that have established networks of cells to conduct drug trafficking operations in smaller, non-traditional trafficking locations in the United States. As of January 31, 2005, there have been 27 deployments nationwide, and one deployment in the U.S. Virgin Islands, resulting in 671 arrests. There have been no RET deployments in the state of New York.

Special Topics: New York City is one of the world’s financial capitals, presenting numerous options for the movement and laundering of drug proceeds. Private banking facilities, offshore banking, wire systems, shell corporations, and trade financing have been used to mask illegal activity. Money has also been laundered through currency exchange houses, stock brokerage houses, casinos, automobile dealerships, insurance companies, precious metal and gem dealers, and trading companies. Most recently, cyber-laundering and the emergence of e-cash provide an extremely expeditious means of moving large amounts of money. Additionally, numerous large scale money transportation and/or money laundering organizations are active in New York, servicing national and international drug organizations. These transportation/laundering organizations routinely conduct multi-hundred thousand dollar “pick ups” of drug cash from trafficking groups. The black market peso exchange and the “hawala” alternate remittance system are also used to move drug proceeds. Despite the extensive financial systems available in New York, many trafficking organizations opt to physically smuggle bulk cash out of the area and/or out of the United States.

In March 2007, Martin TREMBLAY, a Canadian national and former President and Managing Director of the Bahamas-based investigation firm Dominion Investments, Ltd, was sentenced to 48 months in prison for violating federal money-laundering laws by agreeing to launder hundreds of thousands of dollars of narcotics proceeds as part of a federal sting operation.

In November 2007, six individuals were arrested on charges that they conspired to import and distribute millions of dollars worth of counterfeit clothing bearing various urban and hip-hop-style designer labels. From August 2003 through November 2007, this counterfeit trafficking organization imported phony designer clothing from China, sold the clothing in the New York metropolitan area and elsewhere in the United States, and then laundered the proceeds from the illegal sales.

More about DEA's New York Division Office

Sources

Factsheet last updated: 3/2008

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