Container shipping giant says the 2019 ‘MSC Gayane incident’ was ‘a wake-up call for the entire container shipping and logistics industry, given the elaborate nature of the underlying criminal activity’

Says drug traffickers ‘used groundbreaking methods to smuggle their drugs, and the operation could not have been foreseen or predicted by any honest shipping operator’

Claims MSC ‘is today recognised as the industry leader for its anti-smuggling efforts’

Line strongly objects to a headline claim in a Bloomberg report that ‘the subversion of a small number of seafarers, in what remain very specific circumstances, amounts to the company being infiltrated by a drugs cartel’

The world’s largest container shipping group MSC Mediterranean Shipping Company has defended its anti-smuggling policies and practices in response to a Bloomberg report on 16 December claiming MSC had become “a prime drug-trafficking conduit for Balkan gangs” as recently as 2019, and that the company’s crews had been “infiltrated” by a drugs cartel.

Bloomberg Businessweek reported that the discovery and seizure by US law enforcement agents in June 2019 of about 20 tons of cocaine worth over US$1 billion on board the MSC Gayane occurred after the powerful ‘Balkan Cartel’ criminal organisation, which reportedly controls more than half of the cocaine flowing into Europe, “had infiltrated MSC’s crews over a decade, exploiting its manpower and vessels to help build a cocaine smuggling empire”.

MSC acknowledged that the 2019 MSC Gayane incident “was a wake-up call for the entire container shipping and logistics industry, given the elaborate nature of the underlying criminal activity”. But it said the drug traffickers behind the MSC Gayane incident “used groundbreaking methods to smuggle their drugs, and the operation could not have been foreseen or predicted by any honest shipping operator”.

‘Uniquely attractive target’

The Businessweek report, based on interviews with more than 100 people in a dozen countries, including current and former law enforcement officials, notes that every shipping company that operates routes from South America to Europe risks being exploited by cocaine traffickers, but “MSC was a uniquely attractive target”, because it “dominates routes that double as cocaine superhighways, primarily those used to haul fresh fruit and vegetables from South America to Northern Europe” – but also as “the world’s largest employer of seafarers from Montenegro, a home to the Balkan Cartel”.

The Bloomberg report also states that “years before the Gayane seizure, European police officials had warned MSC that its crews had been infiltrated. Yet the steps executives took to mitigate the problem fell woefully short, officials on both sides of the Atlantic say.”

It highlights that the discovery in 2010 of cocaine smuggling involving the MSC Oriane triggered a European investigation into the infiltration of shipping companies by organised crime. Around 2012, agents from the UK, Spain, Belgium and the Netherlands met and agreed to gather all the information they had on ‘drop-offs’ – a technique used by smugglers in the Oriane example in which cocaine was carried across the Atlantic on commercial container ships owned by various companies, then transferred to smaller vessels before the cargo arrived in port. It emerged that while several major companies had been used, “one name came up frequently: MSC”, the report claimed.

By 2013, Businessweek reported that several European countries had come to suspect that the Balkan cartel had found a way into MSC’s crewing operation, citing police and court reports in 2013, 2014 and 2015. For example, a 2013 Montenegro police report on Balkan organized crime said cocaine trafficking gangs in the area had “developed networks of temporary members which usually consist of seafarers from Montenegro, Serbia and Croatia, who are mainly employed on container ships of the MSC company”.

Around 2016, officers from the Netherlands, Belgium and the UK approached MSC’s management, providing the company with select details from the investigations and asked for help curbing the drop-offs. Businessweek reported that MSC was told that the Balkan Cartel had used a crewing agency in the region to get corrupt sailors on board its ships.

Bloomberg said it was unclear what MSC did with the information, but a senior Dutch police officer involved believed the company took extra security measures and switched the crewing agency it used in the Balkans. Dutch antidrug police began to see fewer ‘drop-offs’, and the technique eventually disappeared almost entirely.

New smuggling techniques

But the report noted that the cocaine smugglers only grew more sophisticated, introducing new techniques – including a kind of reverse variation of the drop-off method, in which cocaine was smuggled onto containerships via speedboats while the ships were in full motion. That led eventually to several discoveries and seizures of cocaine on MSC ships in 2019 after agents identified at least four MSC ships where they believed crew members were involved in smuggling cocaine: Carlotta, Desiree, Avni and Gayane.

Court records show that when the Gayane was eventually seized in June 2019, at least eight of the ship’s 22 crew members – six from Montenegro, two from Samoa – were involved in handling the cocaine found on board the ship, including at least four that had been recruited in Montenegro shortly before boarding the ship. Some had apparently been pressured to cooperate by gang members that threatened to harm their families.

US Justice Department documents state that “crew members helped load bulk packages of cocaine onto the vessel from speedboats that approached the vessel in the middle of the night under cover of darkness… used the vessel’s crane to hoist cargo nets full of cocaine onto the vessel and then stashed the cocaine in the vessel’s shipping containers. After hiding the drugs among legitimate cargo, crew members used fake seals to reseal the shipping containers.”

MSC’s response
In response to the mid-December report, MSC said most of the elements in the Bloomberg story had “already been publicly reported during the years since the Gayane incident, and MSC’s Victim Impact Statement related to the incident is filed in court”.
MSC added: “The cocaine trade has been surging in recent years and this is an industry-wide issue. All modes of transport, from ships to trucks, trains and planes, are subject to the threat of illicit trafficking and as long as consumption continues, supply through international drug cartels will persist.”

Groundbreaking methods
It stressed that shipping lines and their staff “are neither mandated, resourced nor trained to confront the dangerous individuals who operate organized criminal organisations”, adding: “The traffickers behind the MSC Gayane incident used groundbreaking methods to smuggle their drugs, and the operation could not have been foreseen or predicted by any honest shipping operator. MSC, like others in the liner shipping industry, remains firmly opposed to this illegal trade and actively takes steps to counter the criminals’ new techniques.”

MSC said it also “strongly objects to Bloomberg’s headline claim that the subversion of a small number of seafarers from Montenegro, in what remain very specific circumstances, amounts to the ‘company’ being ‘infiltrated’ by a drugs cartel”, adding: “Montenegro has a long tradition of seafaring. The majority of its crew are honest, good at their job and work hard to earn a living for themselves and their families.

“All contractors to MSC passed through a robust vetting procedure that included the US C-1/D visa for all Montenegrins who would call at US ports. While MSC’s precautionary response to the Gayane drug seizure was to reallocate its Montenegrin contractors away from shipping routes that are most vulnerable to drugs trafficking, the company takes issue with the article’s overall characterisation of one country’s maritime workforce based on the emergence of a tiny minority of criminals among them.

“Unfortunately, there will always be individuals who can be corrupted by drugs traffickers – or, even more difficult to predict, decent people who will succumb to violent threats by dangerous criminals against them and their families. This is a human factor which is impossible for individual companies to control entirely.”

Wake-up call for container shipping
MSC added: “The MSC Gayane incident was certainly a wake-up call for the entire container shipping and logistics industry, given the elaborate nature of the underlying criminal activity. Since learning of this increased threat in 2019, MSC has significantly intensified its own security efforts, investing far in excess of USD50 million in 2022, and will continue to do so in future years. MSC is today recognised as the industry leader for its anti-smuggling efforts.
“In fact, there are now more than 50 different ways in which MSC seeks to detect potential illicit activity across major trade lanes, including state-of-the-art and proprietary technology based on artificial intelligence, in close cooperation with law enforcement bodies.”

The company stressed that the global drugs trade “is a systemic problem that no single company can address alone. From the sources of production to the consumers who drive demand, everybody in the supply chain must seek to play their part, to help law enforcement, customs and port authorities to better control the issue.”
MSC concluded: “Following on from MSC’s long track record of collaborating with authorities such as US Customs Border Protection (CBP) and the Drug Enforcement Administration (DEA), MSC will continue to constructively assist governments around the world wherever it can. The company remains an active partner of the US C-TPAT (Customs-Trade Partnership Against Terrorism) initiative.”

Will Waters, contributing editor FORWARDER magazine