This is part two of Ian Urbina's four-part series with World Ocean Radio. Read the transcript below.


Welcome to World Ocean Radio…

I’m Peter Neill, Director of the World Ocean Observatory.

This week we continue sharing powerful examples of crime at sea as  documented in “The Outlaw Ocean” by Ian Urbina, New York Times  Investigative Reporter and W2O Advisor.

Not all maritime corruption occurs at sea. Ports are key points where  ships and crews come in contact with authority, sometimes for good when  vessels can be apprehended for illegal fishery, the captains arrested,  the boat destroyed, and the crews sent home, sometimes for bad when port  fees can be extorted, fake repair bills and docking charges applied,  fines adjudicated, schedules interrupted resulting in cargo spoilage and  failed deliveries, ships condemned and held hostage as leverage for  inflated shippers’ ransom, and possibly fraudulent appropriation through  a forced public auction or judicial sale.

“For all the expense imposed by this sort of port corruption,” Urbina  writes, “shipping is still highly lucrative because most seasoned  operators know whom to pay off and how to pass to consumers these hidden  and inevitable costs of doing business. More than 90% of the world’s  goods, from fuel to food to merchandise, is carried to market by sea,  and bribery in ports adds hundreds of millions of dollars each year in  unofficial import taxes and added costs of cargo and ship fuel, which in  turn raise transport costs, insurance fees, and sticker prices by more  than 10%.”

“There are also geopolitical costs to the world’s vast ‘phantom  fleet’ of purloined ships, which are virtually impossible to track as  they are used to carry out a broad area of crimes. In Somalia, Yemen,  and Pakistan, for example, phantom ships are used to transport fighters  tied to Islamic militant groups, and they were used in 2012 by the  terrorists who attacked Mumbai. In Iran and Iraq, phantom ships have  been popular or circumventing international oil or weapons embargoes.  Elsewhere they are typically used for other purposes: in Southeast Asia,  human trafficking, piracy and illegal fishing; in the Caribbean,  smuggling guns and drugs, and off the coast of West Africa, transporting  illegal bunker.“

“Some peculiarities in maritime law play into the crooks’ hands. A  captain’s logbook carries unusual legal weight in a courtroom, for  example. If a corrupt charterer pays a captain to write that the cargo  was damaged during the trip, that ship is probably not leaving port  until someone pays up. Ship sales are also more anonymous and final than  sales of other types of property. This is one reason why ship purchases  are a popular method for laundering money and dumping assets that  corrupt individuals or corporations don’t want governments to find and  tax. Because a ship may be bought in one country, flagged to another,  and parked in a third, it becomes difficult for countries to trace the  origins of the money invested in a ship.”

“[More anonymous] ship trading also makes stealing easier. If the  rightful owner can catch up with a stolen painting, car, or artifact at  an auction, he can make a claim and, in may cases, repossess his  property. Such redress is far more difficult under international  maritime law. A vessel sold at a judicial auction is deemed in industry  parlance to have had its ‘face washed” clean of liens and other previous  debts, including mortgages.”

“Police struggle to chase stolen ships. In most cases, marine  authorities can pursue, intercept, board, and seize a foreign-flagged  ship on the high seas only if the pursuit started in the authorities’  territorial waters and the kept the fleeing visual in visual contact the  entire time. In many courts of law, visual contact means neither  satellite nor radar observation but actual line of sight with the human  eye. From the bridge of a ship, that’s usually about seven miles in  clear weather.”

“If a chase starts on the high seas, it’s even more fraught. Except  under special circumstances, a ship may only be stopped in international  waters by a warship of its own flag, or with permission granted from  the fleeing ship’s flag state. Liberia, the country with the most  vessels sailing under its flag—more than 4,100—has no warships. The  country with the second most, Panama, does not routinely operate  warships beyond its own coast. Therein lies the beauty of international  ship thievery: crooks only have to run if someone’s chasing them, and  that’s rarely the case.”

If you look at the routes of ships from a satellite perspective, you  can trace a complicated network of passages across every ocean to every  part of the world, a complex web of commerce and financial exchange that  reveals our connectivity but also hides an equally diverse, less  visible skein of corruption. Follow the money, they say, and when you do  so across the ocean, you will inevitably find moral indifference and  overt crime for which all of us pay the price.

We will discuss these issues, and more, in future editions of World Ocean Radio.