PANAMA IN WORLD WAR 2

Apologies if this post goes off at a bit of a tangent, but having acquired a book about the defences of the Canal, and having been brought up on war films and war stories in comics and Commando Picture Library, like most boys of my era, I realised I knew little about Panama’s role, such as it was, during WW2 (and I guess most Panamanians know even less, if my wife is anything to go by).

So I did a bit of cursory digging and put together the following, for my own education and understanding.  It also means, as I travel around, I might come across places I have found reference to, which might help to put them in context and add to their interest.

Anyway, here it is, for what’s it worth –

PANAMA IN WORLD WAR 2

INTRODUCTION

Panama had achieved independence from Colombia with the assistance of the US, to enable the US to complete construction of the Panama Canal, which saw the first transit on 15 August 1914, as the First World War was underway in Europe.

The Republic of Panama granted to the US from 1903 and in perpetuity the use, occupation, and control of a zone of land and land under water for the construction, maintenance, operation, sanitation, and protection of the canal by virtue of the Isthmus Canal Convention.  The Canal Zone had an area of 553 square miles (1,430 square km) and a status of “unorganized US territory”.  The “capital” of the Canal Zone was Balboa, where there was a port at the Pacific end of the Canal complex.  The Canal Zone consisted of the Canal itself and an area generally extending 5 miles (8 km) on each side of its centreline, but excluding the Panama City and the city of Colon, that would have fallen partly within the 5-mile limit.  When reservoirs were created to assure a steady supply of water for the Canal locks, those lakes were included within the Canal Zone.  Its official status was as an unincorporated territory of the US

Until 1979, the territory remained controlled by the US, which had purchased the land required from the private and public owners, built the Canal and financed its construction.  The Canal Zone was finally abolished in 1979, under the Torrijos-Carter Treaties of 1977; with the Canal itself placed under joint US–Panamanian control until it came under fully Panamanian control in 1999.

Defences had been put in place to protect the Canal during World War 1, chiefly to protect it from a naval attack – Germany being the only realistic enemy (and given that the bulk of the Imperial German Navy end up being holed up in Kiel, perhaps not a very realistic one).  Sabotage from land or by use of a vessel, or an attack by a German raider were more likely prospects than an all-out naval assault – and in World War 2, even with the threat of the larger and more potent Imperial Japanese Navy, sabotage of some kind, as well as air attack from carrier-based aircraft, was more likely than an attack by a warship using its guns (this being the case, the naval artillery guarding the Canal gradually became redundant during World War 2).

However, after World War 1 a combination of US isolationism, restricted military and naval budgets and the Great Depression of the 1930s meant that little was spent to improve, or even maintain, the defences of the Canal.  Only in 1929 did the US Congress grant the necessary appropriation to construct a badly needed airfield at the Pacific end of the Canal – with Albrook Field being constructed in 1930, but thereafter, until the emergency funding in the run-up to World War 2, virtually nothing was spent to improve the defences of the Canal.

THE STATUS OF PANAMA IN 1939

A new President took office in Panama in 1940, Arnulfo Arias, who was overtly pro-Axis[1], hostile to the US and sought to limit US influence over his country.  He was to be deposed and replaced in 1941[2] in a bloodless coup supported by the US.

The US had asked for 999-year leases on areas outside the Canal Zone to build essential defences – airfields, anti-aircraft batteries and warning stations, but the negotiations had dragged on for 2 years, with Arias demanding cash compensation and other conditions[3], estimated to have a cost of up to $30 million.

The US had compromised, instead asking for 10-year leases, or as long as a threat to the Canal existed (whereas Arias wanted return of the properties as soon as war ended).  The US had also wanted Panamanian ships armed and used to carry war supplies to Britain.  However, Arias resisted this – Panama was neutral, and remained so until after Pearl Harbor[4].

After Arias was replaced (by the national police, Panama having no army) in October 1941 by Ricardo Adolfo de Guardia, the new President proved much more amenable and negotiation were soon concluded successfully[5].

THE DEFENCES

Until the passage of the Two Ocean Navy Act 1940, the ability of the US fleet to move between the Atlantic and Pacific, and vice versa, was considered fundamental to the protection of Continental USA.  Hence, the protection of the Canal was regarded by the US Army as second only to protection of the US itself.

The original defences were constructed to protect against a naval attack, and/or an associated landing of troops, with heavy naval guns at the Atlantic and Pacific ends of the Canal route and a Mobile Force with light artillery for close-in defence and to counter a landing.  These original defences were authorised in 1911, at a cost then of $14.1 million (including installation of submarine mines).  By 1917 the defences and troop levels had reached their optimum.

The Hay-Buana-Varilla Treaty gave the US the right to fortify the Canal Zone, and since its construction, US military forts provided protection for the Canal – Forts Sherman[6] and Randolph on the Caribbean end and Fort Amador on the Pacific end.  Fort Clayton was established close to the Miraflores Locks and close to Panama City, while Fort Davis was adjacent to the Gatun Locks.  Many other military installations, and airfields were to follow, including outside the Canal Zone during World War 2, including on strategic offshore islands, such as Taboga[7], which is close to the Pacific entrance.  Entry into, and trespassing on, the Canal Zone was strictly controlled, particularly during the war[8].

During the pre-war period, a number of factors affected the assessment of risks facing the Canal.  While a naval attack on the Canal, or a troop landing from the sea, were the principle threats thought to affect the Canal at the time of World War 1, the increase in commercial aviation in Latin America during the 1920s and 1930s gave rise to the threat of potential air bases from which an attack against the Canal might be launched.   At the same time, it was found that experience in jungle manoeuvres was beginning to make a myth of the impenetrability of tropical forests[9].  Difficulties in the relationship between the US and Panamanian governments could curtail the ability of forces in the Canal Zone to move out of the Zone, and into the territory of Panama proper to take up defensive positions or new installations.   While sabotage remained a major threat, an air attack by either land-based or carrier-based planes came to be regarded as a more serious threat because of gaps in the defence against them[10].

Although there were some replacements and improved weapons received following World War 1, between 1929 and 1939 many of the large guns were placed in caretaker status due to funding shortages, only being restored to operational capability from 1939.

Two 14-inch railway guns were also received between the wars, these considered to be useful due to their relative mobility using the Panama Railroad than ran across the isthmus.  Received in 1928, these were still in place in 1941.

A large-scale pre-war Army and Navy exercise proved that safeguards for the Canal’s locks had inadequate protection from sabotage, leading to military guards being used, to supplement existing security, at the locks[11], power houses and other important sites[12] – this role eventually being taken on by the Mobile Force.  However, a review in 1939 found that protection from potential sabotage attacks was still inadequate.  The Canal authorities at the time considered the greater risk came from sabotage caused by or from a transiting vessel[13] – and during the war (in fact, from 1939) armed guards were placed aboard ships in transit[14].

During the war the danger of air attack became the primary concern and it was felt that the heavy mortar batteries dating from World War 1 were virtually defenceless from air attack, and in 1943 the sites were stripped and the mortars removed.  Even the large guns – 16-inch and 14-inch coastal artillery – were to be little used, even for practice, the last firing of them being in 1944, and after their last practice in 1944 they remained unmanned and were finally removed between 1946 and 1948.

Coastal artillery had also been placed on 2 islands at the Pacific end of the Canal, Taboga and Taboguilla, in Panama Bay, these having being acquired by the US Army for this purpose.

The mines deployed in the sea approaches caused problems, with accidental firing occasioned by anchored mines being struck by large fish, parts from a sunken vessel offshore and other debris, and even heavy seas, causing mines to explode. One Canal tugboat was also sunk after transiting an area that had been declared safe.

There were also anti-submarine nets, and anti-torpedo nets were deployed to protect the locks against attack using aerial torpedoes.  Then there were defences designed to cope with the threat of attack by small, torpedo-armed boats – with searchlights and deployed field guns.

It was not until 1929 that the need for an airfield on the Pacific end of the Canal Zone was accepted and Albrook Field was constructed in 1930[15].  The other military airfield at the time was at France Field at the Atlantic end.  There were other civilian airfields, including the main ones at Panama City and David, but in 1935 the US Army[16] acquired a lease to use Rio Hato which, during World War 2, expanded to become a major airbase housing bomber and fighter aircraft.  The acquisition of Rio Hato had been the first major formal lease of land by the military outside the Canal Zone.

It was recognised by 1940-41 that the air defences of the Canal were inadequate, experience from the war in Europe also proving the need for early warning of approaching aircraft.  Plans to deal with the shortcomings led to the stand-off with the Panamanian government (as further sites outside the Canal Zone were necessary), and the removal of the then President Arias, and, as explained below, an agreement to acquire the additional sites was only reached in 1942.

Before the outbreak of World War 2 in 1939 there were very limited anti-aircraft defences, with 12 3-inch batteries, machine guns and searchlights.  In June 1940, all anti-aircraft defences were ordered to wartime status, and remained so until 1945.  The equipment was upgraded as the war progressed, with automatic cannon and additional heavy weapons added.  Barrage balloons were also employed, some from barges on the Canal itself.

A blackout was imposed in the Canal Zone from 7th December 1941.

At the time of Pearl Harbor in 1941, there were only 2 radar sets in use – one at each end of the Canal, with visual sighting and sound detection also in use.  As with the gun defences, the number, types and uses of radar improved throughout the war.

Under the new war planning adopted in 1939, it became US policy to prevent the development of any potentially hostile airbases on land that could threaten the Canal – either to attack the Canal itself, or to support a surface attack or landings.

During the war, the US constructed in the Canal Zone and elsewhere, 9 airbases and aerodromes, 10 bases for ground forces, 30 aircraft warning stations, 634 searchlight and anti-aircraft positions, and various other facilities – at a total cost, in 1940 dollars, of $1.36 billion.

The construction work involved with the defence expansions necessitated bringing to Panama of workers from the Caribbean and other Central American states – something that did not prove popular with the Panamanian government.  By 1942, there were over 65,000 workers in Panama, employed by the US to work on construction of defence facilities.  Only a relatively small proportion were those “imported” by the US, but they were regarded as essential to resolve the labour shortage encountered in the rapid expansion required by the defence plans.

The US also built the first trans-isthmus highway, which opened (mainly for military traffic) in 1942.  Other roads, and a bridge across the Canal were also completed.  Work also began in 1940 on a new, third, set of locks, large enough to accommodate the planned 58,000-ton Montana-class battleships on order in 1940.  However, in 1942 the US Navy postponed indefinitely Montana class and the plans for the new locks were also suspended.

Amongst the other defences mooted for the Canal were camouflage nets and the creation of dummy locks to deceive an air attacker.  Neither proved feasible.  Another suggestion was to lay down a smokescreen.  Such an approach had been first considered in 1930, but it was in 1942 that smoke generators were ordered into place to protect certain installations.  Thousands of “smoke pot” smoke generators were employed, including on barges in the Canal itself.  However, its effectiveness (and complicating side-effects) were queried and, in 1943, the smoke defences were deactivated.  Like the smoke defences, barrage balloons were gradually downgraded, and all had been finally withdrawn by the end of 1943.

A further, and bizarre, aerial defence installed in 1942 was the so-called “killer curtain”, an aerial cable draw net situated near the Pedro Miguel Locks, designed to deter low-flying torpedo-bombers.  It was normally only raised into position (this taking around 5 minutes) during an alert.  Its only victim was a US Army Air Force O-47 observation aircraft, which hit it in 1943, when the falling curtain also fell across the railroad’s electricity transmission line, disrupting power supplies and railway traffic.  As it had proved more of a liability than a benefit, this form of defence was discarded.

THE US, THE CANAL AND THE EXPANSION OF US ACTIVITY PRIOR TO PEARL HARBOR

In 1939, in the light of the worsening world situation (and the realisation of the critical condition of US defences in general), a plan was approved that included in respect of Panama a commitment to rapidly complete planned defensive installations, improvements to the security of the Canal and an enlargement of its locks (to allow the passage of larger vessels).

The new plans described the Canal as the keystone to the defence of the Western Hemisphere, and it was intended to have the greatest air power strength of any of the overseas bases meant to defend the Western Hemisphere, to prevent both attacks on the Canal and the establishment of hostile airbases within striking distance of the Canal.

Also in 1939, considering that the Pacific approach to the Canal lacked the islands that could provide a screen offering the chance of early warning for an attack force heading towards the Canal from the Atlantic side (a situation improved considerably in June 1940 with the acquisition by the US of bases in bases in Jamaica, Antigua, St. Lucia, Trinidad[17], and in British Guiana), a US Army review recommended extending the Canal’s defences westwards into the Pacific.  The review suggested that the Galapagos Islands, about 1,000 miles south-west from Balboa port (and belonging to Ecuador[18]) could be used as an advanced airbase and warning station.  Also considered were the Cocos Islands, about 500 miles west of Balboa (and belonging to Costa Rica[19]) – though these were small and lacked a good harbour, it was thought they could house an aircraft early warning station.  Then there was Clipperton Island, essentially a rock, 2,000 miles to the north-west of Panama and French territory.   However, in the 30s the War Department felt unable to recommend or urge that these proposals be pursued[20], and President Roosevelt had decided that the acquisition of any territory belonging to the other American Republics would not be in the public interest.

With the changed environment in the lead up to the war, before the end of 1941 an agreement with Ecuador saw permission obtained to build bases in the Galapagos Islands.  At the same time, negotiations for similar bases in Ecuador and Peru[21] were under way, and a squadron of Army bombers had begun operating from airfields in Guatemala[22].  In this way, a semicircle of defence similar to that provided in the Caribbean was to be constructed in the Pacific[23].  The attack on Pearl Harbor hastened things, as Ecuador became concerned for the security of its islands, but as facilities had to be constructed from scratch, it was May 1942 before the first Army bombers reached the base in the Galapagos.

1939 also saw Panama change its status from being a protectorate of the US, with the ratification by the US Senate of the Hull-Alfaro Treaty[24].  The Treaty made certain concessions in the operation of the Canal, gave up the right of territorial acquisition in Panama and increased the annual annuity paid to Panama.  It also was intended to give Panamanian merchants access to passing ships, allow Panamanians free transit across the Canal Zone, and an ancillary note promised equal employment treatment of Panamanian and US nationals.  The US military had opposed most of these measures and fought ratification by the Senate.

The arrival in the US Army Air Corps of the first B-17 long-range bombers in 1937 saw proposals from long-range bomber advocates that the Army have a greater role in coastal defence, but for the time being responsibility remained with the Navy.

When war broke out in 1939, an Executive Order placed the commanding general of the Panama Canal Department in charge of all civilian and military activities in the Canal Zone, including the Canal.  Later that same month, a meeting of Latin American nations was held in Panama, organised by the US, which resulted in the Declaration of Panama[25], one outcome of which was the creation of a 300-mile Neutrality Zone around all North, Central and South American territory[26].

Due to the fears of sabotage, security at the Canal, and particularly the locks, was stepped up.  From Summer 1941, Army guards were placed on vessels in transit through the Canal, and aircraft defences and harbour defence troops were put on alert.

At the time of Pearl Harbor in December 1941, US Navy resources in the canal area consisted of only 2 old destroyers and a gunboat, plus 6 submarines, 3 converted yachts, 5 sub-chasers, 1 mine sweeper, and 12 patrol planes with their tender.

GERMANS IN SOUTH AMERICA AND PANAMA

In the immediate pre-war period, there was growing German influence and involvement in South America.  Pre-war planning even considered the risk of German/Italian seizure of the area around Natal in eastern Brazil, to strengthen their strategic position in the South Atlantic[27].  From there a threat to the Canal could be posed.

However, when war broke out in Europe, the chance of a German naval attack on the Canal – given the size and strength of the British and French navies – was considered low, and in any event the US remained neutral.  On the other hand, it was estimated in 1939 that there were 3 million nationals of the Axis countries in Latin America, with a further 6 million whose descent was from those countries – the largest numbers were in Brazil and Argentina[28].  Neighbouring Colombia was home to around 7,000 Germans, and Germans also controlled the airline SCADTA[29], which had been formed in 1921 by a pioneer Austrian pilot.  German company Junkers owned Lloyds Aerea Boliviano in Bolivia, and a Lufthansa-owned holding company also controlled airlines in Argentina, Brazil, Chile, Ecuador and Peru.

SCADTA was said to have produced photo-maps of Panama, from the Colombian coast to the Canal Zone, and to have supplied details of strategic areas in Panama, including the approaches to the Canal.  In addition, from 1937, it began training German pilots in Colombia.  Diplomatic pressure on Colombia by the US resulted in the German pilots being removed, and then the airline was bought by Pan Am World Airways, which already owned 80% of the airline.  After taking over SCADTA, Pan Am fired all its German staff bar the chief executive, and then discovered that SCADTA had begun building secret airfields at strategic locations in Colombia.

In 1940, as mentioned below in relation to pre-war Japanese activity in Panama, a Japanese resident was arrested and admitted planning to pass on information of a British ship in Balboa port to a German resident (described as an “ardent pro-Nazi”).

In mid-1940, following the French Armistice, despite continued US (and Panamanian) neutrality, there were fears that the Germans could attempt to sabotage the Canal to hamper US supplies to Britain, and to prevent the transfer of the US fleet to the Atlantic.  The Canal Zone was put on alert against possible surprise attack or sabotage.

Following the Pearl Harbor attack in December 1941, German and other Axis nationals, and potential sympathisers of other nationalities (including naturalised Panamanians), in the Canal Zone and Panama itself were rounded up.  Those detained by the Panamanian authorities were turned over to the US authorities in the Canal Zone for internment at a camp at Balboa[30].  A committee then decided which should be permanently detained.

Soon afterwards, in 1942, a dispute arose when the Panamanian government objected to the US military releasing some of the internees that had been picked up and delivered to internment by the Panama authorities.  The Army was told to continue to detain such internees, at least until a more permanent camp could be constructed.  It has been claimed that the practice of releasing

the internees angered the Panamanian authorities, who wanted the enemy aliens removed, for as long as they remained in Panama there was still the chance they could be released.  Should they be swiftly removed the Panamanian government could move to take possession of their unattended shops and farms[31].  As in the UK, some of those detained had fled the Nazi regime, and in Panama included at least one ex-Buchenwald inmate.

During World War 2, the Panama Canal Department had direct responsibility for intelligence not only for the Canal Zone and defence sites in Panama proper, but also the greater area including Honduras, Guatemala, Nicaragua, Costa Rica, Colombia and even Peru.

It is perhaps unsurprising that the Germans would plan to somehow attack or sabotage the Canal and its operations.  It is even claimed that they planned an attack[32] using Ju 87 Stuka dive-bombers, transported by U-Boat, in a manner similar to that planned by the Japanese.

Then in 2017 Chile’s investigations police declassified the files of a special unit called Department 50[33].  This group hunted for German spy rings during the war (although Chile only declared war in 1943).  The documents revealed that a cell in the port of Valparaiso were planning to bomb the Panama Canal, though they offer no details of the plot[34].

U-BOATS AND THE CANAL ZONE

Despite the considerable threat from U-Boats in the Caribbean (see below), and the significant effort put into patrol activities in the Panama Sea Frontier[35] to detect and deter them, the direct impact on the Canal and its operations from U-Boats was relatively minor.

Until June 1942, U-Boats had only entered the outer reaches of the Panama Sea Frontier.  Then the SS Merimack, carrying supplies to the isthmus, was torpedoed about 60 miles off Couzimel Island – a mostly undeveloped Mexican island off the Yucatan Peninsula.  This was followed by 2 more merchant vessels near Swan Island off Honduras, 3 more near Old Providence and St Andrews islands, two Colombian islands.  A further vessel was sunk some 85 miles from Colon.

At the time of these attacks, a gunboat[36] was the only active escort vessel available in the area.  There were 4 destroyers engaged in offshore patrol but, lacking radar, they did not detect any U-Boats.

2 more merchant vessels were sunk near the Canal in June 1942, by which time there were 4 U-Boats active in the immediate area.  As a result, the Navy ordered the port of Christobal closed to outbound traffic and organised a “hunter-killer” group consisting of 2 destroyers, 3 MTB[37] and PBY Catalina patrol flying-boats.  It pursued a U-Boat spotted by an Army bomber off Colon, but found nothing.  At the same time, additional PBY and Army bombers were made available for use on the Caribbean side of the canal, and an escorted convoy of transports en route for the Pacific passed through the Canal shortly after.

However, a British tanker bringing fuel to Christobal was then sunk by 2 U-Boats within 75 miles of the port, followed by 2 more vessels sunk off Santa Marta, Colombia and a schooner sailing ship off the Colombian coast.  Shortly after, a U-Boat entered Port Limon, Costa Rica and sank a merchant ship in the harbour[38].

This brief outbreak of near-direct attacks affecting the Canal, involving no more than 5 U-Boats but seeing on average a ship a day sunk over a 2-week period, resulted in further, additional defences being implemented on the Caribbean coast.  These included anti-submarine nets at Port Limon, increased air patrols (including with radar-equipped PBY), and convoys being organised for shipping between the Canal and Guantanamo Bay, Cuba.

The improvements probably contributed to the first U-Boat “kill” for the Panama Sea Frontier sector.  An abortive attack on a US net tender resulted in a patrol boat and PBY being despatched to carry out a search, with Army aircraft (fighters and a B-18 bomber) and a further PBY joining the following day.  On the next day the patrol boat spotted an oil slick and it and searching aircraft used all their depth charges, then a destroyer, detached from a convoy, arrived, detected the U-Boat and attacked.  The U-Boat was sunk[39].

In August 1942, aircraft from the Army, Navy and the RAF made 18 attacks on U-Boats in the Caribbean.  On 22nd August, a B-18 bomber sank a U-Boat off Colon[40].

In October 1942, for the first time in 6 months, there were no losses to U-Boats in the Gulf of Mexico and Panama Sea Frontier areas[41].  In fact, after January 1943, U-Boats were never again a major threat in the Caribbean.  Attacks continued, and losses continued, but the Kreigsmarine regarded the Caribbean as a difficult or dangerous place to operate – the Submarine Command war diary noting the presence of strong to very strong air patrol, convoys and independent vessels protected by air and surface escorts, and day and night radar – combined with the stress caused by the heat, humid atmosphere and having to operate submerged for long periods to avoid detection.

Nevertheless, the Germans tried once more and, in October 1943, a minelaying U-Boat laid mines within 4 miles of the Colon breakwater.  These caused no damage, and most were swept within a month[42].

The minelaying having proved to have had little effect, and in November the Kreigsmarine commander, Doenitz, ordered an attack by 3 U-Boats on shipping in the Caribbean.  Unfortunately, when the first U-Boat arrived in the Panama Sea Frontier area the sea defence forces were engaged in a tactical exercise with 2 transiting escort carriers on the Pacific side.

Alerted by a sighting of a U-Boat near Curacao, ships and aircraft were used in an attempt to detect it.  However, the U-Boat managed to reach the Canal area by hugging the north coast of South America and sank a small Panamanian freighter (with a US Navy armed guard aboard) 60 miles off Cartegena, Colombia.  It then sank a small Colombian schooner off Christobal, and then an unescorted US tanker at the same spot, followed by another unescorted ship, a Liberty Ship, 75 miles off the entrance to the Canal.  The U-Boat then escaped searching aircraft, while all unescorted shipping was stopped (and some convoys), with some convoys rerouted along the Mosquito Coast.

Nevertheless, the U-Boat claimed another victim, off the Gulf of San Blas before leaving the area, low on fuel.  On its way home, the U-Boat managed to sink another unescorted US tanker 30 miles off Aruba.  Once more, intense searches were launched for the submarine, with it evading or beating off aerial attacks.  Eventually, the U-Boat returned home safely[43].

In total, in 1942 U-Boats in the Caribbean sank 336 ships of over 1 million tons.  In 1943, this had fallen to only 35 ships and 178,000 tons, and in 1944, only 3 ships of 15,000 tons were lost to U-Boats.

In an ironic twist, postwar one of 3 heavy lift cranes built in 1941 by Demag Cranes AG as Schwimmkran No. 1 for the the Kreigsmarine for use in the Baltic Sea tending to U-Boats ended up in a maintenance role in the Canal Zone[44].  Following the closure of the US shipyard where it had been employed, “Herman the German” was sold to the Panama Canal Commission and it was transported on a semi-submersible ship in 1996 to the Canal Zone, where it remained into the 21st century, serving as the floating crane Titan[45].

THE JAPANESE THREAT – SPIES AND FISHING BOATS

By 1941, the Japanese community in Panama numbered an estimated 400.  The Chicago Tribune stated in 1940 that Japanese made up a visible part of the population of Colón on the Pacific coast. Some individuals even resided inside the Canal Zone[46].  Japanese-owned businesses were common in Panama – there were 47 Japanese-owned barber shops in Panama City and Colon (i.e. the two ends of the Canal) alone.

In the lead up to World War 2 there were reports of Japanese reconnaissance using fishing boats along the Pacific coast of Mexico and Central America.  The fishing industry in Panama was, in the 1930s, almost entirely in Japanese control, and in 1934 Japan was pressing to have a refrigeration and processing plants on the island of Taboga, close to the Canals’ Pacific entrance.  Counter-pressure to this proposal came from the US military, and the then-President resisted the Japanese pressure.

From 1935, Japanese espionage activity in Panama increased.  One of the many barbers shops in Panama City was, in fact, owned by a Japanese[47] who was, in reality, a Commander in the Imperial Japanese Navy.  The reconnaissance carried out by fishing boats along the Panamanian coast was apparently evidenced by reports of the boats returning from all-day trips with no catch.

The Japanese-owned fishing vessels included longer-range tuna boats, one of which was owned by a Japanese who was chief of Japanese intelligence for Central and South America[48].  He also owned a large store in Panama City, and encouraged amateur photography with a photography club and offered attractive cash or camera prizes for the best pictures each month of subjects in the Canal Zone – seemingly a fairly blatant intelligence-gathering ruse.  Photography was finally prohibited in the Canal Zone in June 1941.

The tuna boat owned by the intelligence officer made numerous trips from which it returned empty-handed, and was noted to have travelled along the Central American coast and even as far as the Galapagos Islands.

US concern at the risk presented by the Japanese fishing vessels led to pressure on the Panamanian government, especially as Japanese activity increased in 1938, and in due course the Panama government imposed a ban on Japanese boats fishing in Panamanian waters.

When the Japanese freighter Sagami Maru passed through the Panama Canal in late 1940, the ship’s crew reported that some 20 US Army officers boarded the ship for inspection[49].

In 1940, a Japanese national who had lived in Panama for 20 years, and was a link between Japanese intelligence and the local Japanese community, was arrested after he was found to have recorded details of a British ship in Balboa port carrying US bombers being transported to the UK.  He admitted that he had planned to pass the information to a German employed by a shipping company in Panama (and agent for the Japanese Line shipping company).  The arrested man worked as a chandler, and hence had free access to the ports’ piers and quays.

After President Roosevelt declared a national emergency in May 1941, the commander of the Panama Canal Department issued an order prohibiting Japanese shipping from using the Canal.  5 Japanese ships in Balboa and Christobal ports at the time were therefore (despite diplomatic protests) forced to travel to Japan via Cape Horn.

Following the attack on Pearl Harbor, enemy aliens in the Canal Zone, and potential Axis sympathisers[50], were rounded up.  Those detained by the Panamanian authorities were turned over to the US authorities in the Canal Zone for internment at Balboa.  A committee then decided which should be permanently detained[51].

The Panamanian government had agreed that following any action by the US to intern Japanese residents, Panama would arrest Japanese on Panamanian territory and intern them on Taboga Island.  All expenses and costs of internment and guarding would be paid by the US, which would indemnify Panama against any claims that might arise as a result[52].  Within 20 minutes of the announcement of the Pearl Harbor attack, Panamanian authorities began rounding up Japanese and German aliens throughout the Republic.

Also interned in Panama were Japanese from Peru[53].  Following Pearl Harbor, the Peruvian President froze all assets held by those with Japanese citizenship and prohibited the assembly of more than 3 people of Japanese descent.  When they were deported from Peru they were first sent to Panama, and thence from there to a camp in Texas[54].  After the war, only around 80 of the 900 detained in Texas were allowed back to Peru[55].

In 1945, US intelligence arrested a Japanese man who had lived for 15 years in the Darien province that bordered Colombia, and where he had a large family and a thriving lumber business.  He was connected to the Japanese royal family as well as being a colonel in Japanese military intelligence.  He was found to have operated a mountain-top radio station for passing on details of US activity in Panama.

PEARL HARBOR AND AFTER

Ironically, given the country’s reluctance to be involved previously, Panama actually officially declared war on Japan before the US.   Panama declared war on 7 December 1941, on the same day as the attack on Pearl Harbor, whereas the US only did so the following day.

Panama, together with a number of other small Latin American states, then declared war on Italy and Germany on 13 December 1941[56].

Whilst before Pearl Harbor the main concern for the Canal authorities and defenders had been sabotage, after Pearl Harbor there were fears that a similar Japanese attack could be made on the Canal, or even the landing in of troops in Panama.  Plans were therefore made to resist beach landings (by a force of up to 50,000 men), on the Pacific coast – an attack from the Atlantic side being considered unlikely, as well as impractical for a number of reasons.

In May 1942, the US and Panama finally signed an agreement allowing for the lease of 134 sites to be used for the protection of the Canal, with the occupation of the sites to end 1 year after the end of the war.

Air patrols from Panama had begun by 1940, and by February 1942 they were established with B-18 bombers from David participating in Pacific patrols (which also involved aircraft operating from Guatemala and Ecuador) and PBY Catalina flying-boats from the Canal Zone operating out to, and from, as far away as the Galapagos Islands in the Pacific.  As already mentioned, it was felt that the greatest threat from air attack (or landings) came from this side, rather than the Caribbean side.

Naval defences from 1940 also concentrated on the Pacific front, with submarine and surface craft patrols covering an arc stretching from Mexico to Peru.

As already mentioned, enemy aliens and potential sympathisers in the Canal Zone and Panama itself were rounded up following the attack on Pearl Harbor.  Those detained by the Panamanian authorities were turned over to the US authorities in the Canal Zone for internment at Balboa.  Those chosen for permanent internment were subsequently removed to detention in the US, with an internment camp at Balboa in the Canal Zone operating as a temporary holding facility.

The defence arrangements for the Atlantic/Caribbean side differed from those for the Pacific.  This was due to the thinking that what was seen as an outer ring of defences in Puerto Rico and Caribbean islands offered protection and more likelihood of early warning, and interdiction of potential attackers.  It was felt that, aside from nuisance attacks (or sabotage), the chief threat to the Canal Zone and facilities themselves from the Caribbean was for small landings from U-Boats[57].  The main threat in the Caribbean and affecting the Canal, at least indirectly, were the activities of U-Boats, attacking allied shipping.

As with the Pacific front, by February 1942 air patrols using B-18 bombers were operating over the Caribbean coats, not just of Panama, but also other Central American coasts and that of Colombia.

As with the ground defences of the Canal Zone, the aerial elements were upgraded and added to as the war progressed.   However, a shortage of Navy patrol aircraft into 1942 meant that Army aircraft would continue to be used to supplement patrol activity, until gradually replaced by Navy aircraft.

 Economically, the war had a major impact on the Panama.  Commercial traffic through the Canal dropped more than a third between 1940 and 1945, resulting in a two-thirds decrease in toll revenues.  However, the inflow of US dollars and increased demand caused by the war, including thousands of workers from other Central American states and the Caribbean, led to a rise in domestic production, with, for example, that of milk, sugar and slaughtered cattle almost doubling between 1939 and 1945[58].

Unlike other US allies, Panama did not receive any Lend-Lease funding, but the US did undertake large-scale public works projects – including roads, a bridge over the Canal, and a third set of locks for the Canal itself, which did much to modernise the country and boost the economy[59].  The US also provided the government of La Guardia with weapons, boats, and other war materials, and established a permanent military mission to assist in training the Panamanian National Police.  Some of the weapons provided were soon put to work in putting down an attempted coup by a group of police officers and civilians in September 1943.

The wartime peak US troop strength during the war was in November 1942, when there were 68,000 men, including 36,000 ground troops, in Panama – compared to the 13,000 that had been there in 1939.  As the perceived threat from the Japanese fell, so did troop numbers, and by January 1944 there were only 42,000 present, and by 1945 numbers had fallen to below 1939 levels.

THE YAMAMOTO PLAN TO ATTACK THE CANAL

As has been mentioned, there had been fears that the Japanese could have launched an attack on the Canal using aircraft carriers, something that the attack on Pearl Harbor in December 1941 of course did nothing to dispel.  The fear of such an attack diminished during the war, as the tide of war swung against the Japanese.  However, there was a definite plan to attack the Canal using aircraft, but not using aircraft carriers.

In 1942, after the Battle of Midway, the Imperial Japanese Navy lacked the capability to launch a major attack on the Canal using its carriers.  Therefore, its commander, Admiral Yamamoto, came up with a daring plan to carry out an attack using aircraft carried by submarine.  The War Ministry approved the plan and in December 1942 issued orders for the construction of 18 very large submarines, the I-400 class[60].

The carriage of aircraft by submarines was not a novel idea, the French and British had both built aircraft-carrying vessels – the British abandoning them after accidents.  The Japanese had even used a smaller aircraft-carrying submarine to make an attack on the US west coast in 1942[61], having by 1942 a fleet of 11 such vessels.  The much larger I-400 class would carry 3 monoplane floatplanes in a sealed tube-shaped container on the foredeck, in additional to a gun and torpedo armament.

However, by mid-1943 circumstances had changed, and support for the Yamamoto plan had reduced, and he had been killed in April 1943.  By then 6 hulls had been begun, but the Navy decided that no more would be laid down.  One (I-402) was to be completed as a supply/tanker submarine, and only 2 other vessels (I-400 and I-401) were to be completed – although the I-403, I-404 and I-405 were begun in 1944, the building programme for the vessels was formally cancelled in March 1945.  Construction of I-403 and I-405 had by then been suspended, and the I-404 destroyed in an aircraft attack in 1945 when 90% complete and had been launched.

Hence, only the I-400 and I-401 were available for the planned attack on the Canal, having been completed in December 1944 and January 1945 – the I-402 was only ready for operation as the war ended.

The eventual plan called for the 2 large submarines to be accompanied by 2 smaller B1-type vessels, such as had made the earlier attacks on the US (but adapted to carry 2 floatplanes, rather than the normal single aircraft).  The aircraft to be used in the attack was to have been the M6A1 Seiran, a 2-seat, twin-float, single-engine monoplane, of greater capability than the biplane type used in the attacks on Oregon.

Each I-400 had a watertight hangar capable of accommodating up to 3 M6A1, which could be launched from a 26-metre compressed-air catapult mounted on the forward deck.  It was said that a well-trained crew of 4 men could roll out an M16A1 on a collapsible catapult carriage, attach the plane’s floats and have it readied for flight in approximately 7 minutes.

The first prototype Seiran flew in November 1943, with production beginning in early 1944, and the first operational example ready in October 1944.  A pilot-trainer version with a retractable wheeled undercarriage was also developed[62].

In January 1945, the 2 I-400 began their shakedown cruises and catapult-launch training.  Trials established that a notional maximum bomb or torpedo load of 800 kg could be carried by the M16A1.  Operational training was to begin in April 1945.  The exact details of the plan to attack the Canal are not known.  However, 10 M16A1 were to be used, 6 with torpedoes and 4 with bombs.

After Germany surrendered in May 1945 the need to block the Canal, and thus prevent the anticipated flow of men and materials transferred to the Pacific theatre, became seemingly even more important.  However, in July 1945, the plan was cancelled, with the submarines and aircraft involved to be diverted to defence of the home islands.  The fleet set sail in July 1945 for a planned attack on US aircraft carriers, but their mission was cancelled as they were en route, and the vessels were ordered to return to Japan.

One can speculate how successful an attack could have been.  It seems likely that, had the submarines reached their objective undetected, surprise would have been total, as by 1944 the aerial capability of the Imperial Japanese Navy (i.e. its aircraft carriers) had diminished considerably.  In fact, in December 1944, a senior US Army Air Force officer flew a P-51 fighter at low-level from one end of the Canal to the other, without being challenged or shot at.

Postwar planners determined that a successful attack on the Canal would have required a force of the equivalent to 4 of the large Midway-class aircraft carriers, with their usual escorting fleet, and some 250 aircraft.

Incidentally, it is claimed that there was an abortive German plan that would have seen submarine-launched aircraft used to attack the Canal (see the section on Germans in Central and South America above).

1941-45

The war did affect Panama in many ways, even though not directly attacked.  For example, early in the war, the freighter and passenger ships belonging to the Panama Railroad Company were transferred to the US Navy, with the shipping line services suspended until 1947.

The primary US Navy naval strategy in the Atlantic areas from 1942 was the destruction of U-Boats operating (including the Wolf Packs) in the Gulf of Mexico, Caribbean and the Atlantic.  This was to include the use of surface craft, aircraft and submarines operating from Panama.  Obviously, shipping using the Canal would be one of the most tempting targets for U-Boats.

However, in January 1942 only 3 U-Boats were operational for the US east coast areas[63].  This number increased to 6 the following month, and never more than 10 over the following few months.  These nevertheless enjoyed one of the U-Boats’ “Happy Times”, including attacks on shipping highlighted against the initially non-blacked out US east coast, and with scanty and improvised defences.   The first U-Boat was lost in April 1942, a coastal blackout was imposed and gradually losses of shipping fell, as improved defences and convoy tactics (escorted by surface vessels and aircraft) were put in place.  The changes led to the Germans abandoning the US east coast (except for some minelaying) from September 1942 until the following Spring.

The first U-Boat was operating in the Caribbean in February 1942.  After running down operations off the US east coast, the U-Boats intensified their operations in the Caribbean, with the struggle being labelled as the Battle of the Caribbean (or Operational Neuland by the Germans).  The main concentration was on oil traffic from Venezuela and Aruba, and South American trade (including all the US supplies of bauxite) which had to pass by Trinidad.  By the end of 1942, 336 vessels or 1.5 million tons of shipping had been sunk in the Caribbean zone.   The battle against the U-Boats in the Panama Sea Frontier have already been detailed above.

In February 1942, an unfortunate accident saw the large Free French submarine Surcouf sunk after a collision with a freighter on Caribbean side of the Canal.  Captured by the British after the French Armistice in 1940 it was turned over to the Free French and sent to Bermuda.  A large and unusual design, as well as torpedo tubes, it also mounted 2 x 8-inch guns in a turret and even (like the Japanese submarines intended to attack the Canal) a single seaplane in a deck canister.  Initially, it was said that the submarine was lost because both vessels were operating at night without lights due to the U-Boat threat; but a later French inquiry claimed that the submarine had been lost in a “friendly fire” incident, after being attacked by US aircraft.

One interesting sidelight on the attitude of the Panamanian government during the war was its reluctance to accept, without at least screening, of US troops from Puerto Rico.  At the start of 1943 there were approximately 17,000 Puerto Ricans in US Army, including the 65th Infantry Regiment, and all of them were stationed either in Puerto Rico itself or in the US Virgin Islands[64].  Negotiations with the Panama government had offered little encouragement for the idea of approaching other Caribbean nations to see if they were willing to accept Puerto Rican troops.  When the War Department proposed to send the 65th Infantry Regiment to Panama as a replacement for continental US troops that were to be withdrawn for service in the Pacific, the Panamanian government insisted on a careful screening of the unit – despite the fact that it was a Regular Army regiment and was to be stationed within the Canal Zone.    However, the performance of the regiment led the US War Department to decide upon a general replacement of continental troops not only in Panama, but in the bases on British islands in the Caribbean as well, at least to the extent permitted by the availability of trained Puerto Rican units.  Eventually, it was hoped, 20,000 Puerto Rican troops could be made available[65].  By the end of 1943 nearly 5,000 Puerto Rican soldiers were in Panama.

The Panama Sea Frontier patrol and threat area covered both Pacific and Caribbean regions.  It stretched from the Mexico/Guatemala border out to the Galapagos Islands and down to a point at 5◦ of latitude on the coast of South America.  On the other side, it stretched from the Mexico/British Honduras border to Punta de Gallinas in Colombia on the north coast of South America, and around 90 miles west of Aruba.  In doing so, the Panama Sea Frontier encompassed the coastlines of British Honduras, Guatemala, Honduras, Nicaragua, Costa Rica, Panama and Colombia.

After the German surrender in May 1945, the redeployment of men and materials from the European to the Pacific theatres was to take place, named Operation Transit by the Panama Canal Department.  20 transports carried 91,000 troops passed through the Canal, together with 105 freighters, between 4 July and 9 August 1945.     However, when Japan surrendered, 17 ships underway, including one already in the Canal, were to be rerouted to US east coast ports.

It seems an incontestable fact that, despite the move to having a two-ocean navy, without the Panama Canal it is unlikely that the US road, rail, seaport and river transport network could have accommodated the flow of men and materials required for the two-theatre war in which the US found itself in 1941.  Between 7 December 1941 and VJ-Day in September 1945, over 6,400 warships and 10,300 other vessels passed along the Canal.

MUSTARD GAS

In 2002, 8 intact bombs, some containing mustard gas were found on San Jose Island, the largest of the Pearl Islands in the Pacific, south from Panama City[66].  The US agreed to dispose of them.  They were a product of a wartime initiative led by the US, and also involving Canada, on the island to investigate chemical warfare munitions under tropical conditions.  Part of the plan was (incredibly to modern minds) racist in nature, with the US Chemical Warfare Service comparing the physical responses of Puerto Ricans and Caucasian Americans to mustard gas[67] – it was thought that there was a possibility that some racial groups are less sensitive to mustard gas.   African-American troops were also tested, as well as Japanese-American ones, by the US Army.

The project began operations in January 1944, the Panamanian government having given its go-ahead to “chemical warfare tests” on San Jose.  Army engineers arrived on the island to clear roads and an airstrip and build the many buildings for operations and housing the project would use. More than 400 enlisted men were stationed on the island by mid-1945, as well as nearly 200 officers and civilians from the US, Panama and other countries[68].

In 2015, NPR in the US ran a 2-part radio documentary on the race-based testing of chemical weapons during the war[69].  It was relatively unknown, being a secret Army programme only declassified in 1993.  One hope had been that black and Puerto Rican troops, if they had more resistance to the gas, they could form the “ideal chemical soldier” – used on the front lines while white soldiers stayed back, protected from the gas.  Tests included spraying of Puerto Rican troops in the Panama jungle from the air.

It has been reported that the US had in Panama an active chemical weapons programme from at least 1930 until 1968[70].  From 1930 to 1946, the programme focused on defence of the Canal, and from 1943 until 1968, it aimed to test chemical munitions under tropical conditions.  Dozens of tons of mustard gas and phosgene were stockpiled at a number of sites in Panama, particularly from the 1930s to the 1950s. Unused and dud chemical munitions were also abandoned in Panama.  More than 130 tests were conducted on San José Island alone between May 1944 and the end of 1947.

Chemical weapons are said to have been a component of US defence tactics from the Canal’s early years – as, after all, when it first opened, during World War 1, gas was regularly being used by both sides.  General William Sibert, the US Army engineer who had designed the Gatun locks in Panama, commanded troops in France during World War 1, became an advocate of chemical warfare and was made director of a newly consolidated Chemical Warfare Service and, postwar, a vocal proponent of the continued development of chemical weapons.

In 1921 the Chemical Warfare Service was told to draw up plans for defence of the Canal Zone amongst other US outlying possessions and the first chemical defence plans were drawn up in 1923 and would be updated every year through at least 1946.  The plan involved bombing with mustard gas the trails and routes that led inland from landing beaches on both the Atlantic and Pacific coasts, spraying the beaches, and firing chemical mortars at military targets.

In 1930, the Army maintained a chemical company of 2 officers and 77 men in the Canal Zone.  There was also 30 tons of “persistent gas”, which had risen by 1940 to 84 tons of mustard gas, 10 tons of phosgene, 800 phosgene shells, 900 Livens projectors, 647 chemical cylinders, and 2,377 4.2-inch mustard-charged mortar rounds[71].  The munitions were stored in Camp Paraíso, Fort Clayton, Corozal Post, Albrook Field, Howard Field, Río Hato, France Field and Fort Gulick.  However, prior to the San José Project being established, most were stored at Cerro Tigre.

Worryingly, it is reported that less information is available on the disposal of chemical munitions stockpiled or used in tests in Panama than on tests themselves.  The San José post diary records that 2 barge shipments took chemical munitions out to sea to be dumped at sea in 1947.  The military evacuation of the San José Project in early 1948 was also carried out with haste, on a 5-week deadline.  Chemical munitions that the military still hoped to use were moved into the Canal Zone.

THE END OF WAR AND THE AFTERMATH

The agreement for use of the sites outside the Canal Zone by the US military called for such sites to be handed back 1 year after the end of the war.  When the war ended with the surrender of Japan in September 1945 a dispute once again broke out. Panama demanded that ownership of the sites be relinquished immediately, whereas the US War Department wanted to keep control of the sites for a further, indefinite period.  However, the US State Department, being aware of growing unrest in the country, proposed negotiation of a 20-year extension of leases in the case of 13 of the sites.

The new President Enrique Adolfo Jimenéz, who had become President in June 1945, authorised a draft treaty to this effect.  This led to an angry, and armed, mob outside the National Assembly when it met in 1947, which persuaded the deputies inside the reject the draft, and by 1948 the US had evacuated all occupied bases and sites outside the Canal Zone.

 

Ray Todd

Panama City

12 February 2020

 

 

 

 

 

[1]  An official memorandum sent by the US Ambassador in 1941 described the situation in Panama under Arias thus,” what has developed in Panama is about as near an approach to Hitlerism as the characteristics of Latin Americans and the peculiar circumstances affecting Panama could be expected to permit”. https://scholarship.richmond.edu/cgi/viewcontent.cgi?referer=https://www.google.com/&httpsredir=1&article=2131&context=masters-theses

During 1941, Arias attempted to have enacted a law prohibiting Jewish immigration and depriving anyone of the Jewish faith without at least one Panamanian parent of their citizenship.  The inherent anti-Semitism appeared to continue in the government under the following President La Guardia.

[2]  While out of the country, on a private visit to Havana.

[3]  Set out in 12 requirements that included the construction of a bridge over the Canal, transfer of all lands belonging to the Panama Railroad in Panama City and Colon, and ending the importing of Caribbean blacks to work in the Canal Zone.

[4]  Although ironically, it declared war on Japan on the same day as the Pearl Harbor attack, and before the US could do so.

[5]  However, he too was forced from office in 1945 by the National Assembly, and went into exile.

[6]  Established in 1911, it consisted of 7 batteries armed with artillery and mortars, a landing strip, command centres, barracks, and recreation areas, all set on about 22,200 acres of land — it is now reportedly blanketed by tropical jungle in the San Lorenzo Nature Park (San Lorenzo hosts a clifftop fortress built by the Spanish in 1575).

[7]  And the tiny El Morro Island, just off Taboga, hosted a PT Boat (US motor torpedo boats).

[8]  My own wife, a Panamanian whose father worked for the US Army in the Canal Zone, recalls having to have permission to accompany her father into the Zone.

[9]  https://history.army.mil/books/wwii/Guard-US/ch12.htm

[10]  Ibid.

[11]  Note that the locks only normally operated from 0600 to 2300 hours; permanent 24-hour operations only began in 1963.

[12]  Other measures were taken to prevent sabotage of other utilities, such as water and power supplies, that could impact operation of the Canal.  Particularly vulnerable were the saddle dams, the man-made levees that ensured water levels in stretches of the waterway.

[13]  Suggested threats were such a vessel ramming lock gates, sinking itself in the locks or main channel, or dropping explosives, perhaps timed to explode much later, overboard.

[14]  On high-risk (or “X”) vessels, the detachment initially consisting of an army officer and 16 men, plus 2 US Navy personnel (who oversaw the helm and telegraph – engine – controls).  Lower-risk (or “R”) vessels carried only 2 soldiers.  After 1940 the rules and procedures revised, with additional personnel and tighter controls imposed.  From 1942, the US Navy took over responsibility for the Transit Guard, using its Marines.

[15]  It remains in use, now being Panama City’s second airport, used mainly for internal routes, business and general aviation.

[16]  Until 1948, the Air Corps was a part of the US Army (as the US Army Air Force from 1941).

[17]  Base rights in Trinidad were an important element of the bases for destroyers deal with the UK in 1940, the justification for these facilities being coverage of the southern routes through the Caribbean islands toward the Panama Canal.

[18]  The proposal that the US acquire both the Galapagos and Cocos Islands had been put forward as early as 1917.  In 1939, 2 Resolutions came before Congress recommending purchase of the Galapagos and Cocos Islands.

[19]  Ibid.

[20]  https://history.army.mil/books/wwii/Guard-US/ch12.htm

[21]  The first B-17 Army bombers arrived from Panama in January 1942; a joint Army/Navy base being built at Salinas.

[22]  The first Army B-18 bombers were operating from Guatemala City by the end of December 1941, a small military force arriving the next month.

[23]  https://history.army.mil/books/wwii/Guard-US/ch13.htm

[24]  https://www.encyclopedia.com/humanities/encyclopedias-almanacs-transcripts-and-maps/hull-alfaro-treaty-1936

[25]  Aka the Pact of Panama.

[26]  Of course, only the US had the capability of patrolling and seeking to enforce the Neutrality Zone – something evidenced by the pursuit of the German warship into the River Platte in 1939.  Later the US was to extend its patrolling to mid-Atlantic, and then to Iceland, effectively escorting convoys and inevitably getting into confrontations, and combat, with German U-Boats.

[27]  In fact, the US eventually negotiated use of base there in 1942.

[28]  German-founded or funded schools might be an indicator of penetration in Latin America, and notably Costa Rica and Guatemala had the greatest number of such schools in Central America with their combined enrolment level at over 500 children: https://scholarship.richmond.edu/cgi/viewcontent.cgi?referer=https://www.google.com/&httpsredir=1&article=2131&context=masters-theses

[29]  Socieded Colombo Alemana de Transportes Aerea – the precursor of the modern AVINCA.

[30]  Originally in tents, which was fine during the dry season in Panama, but more permanent structures would be required from early- to mid-1942, as the rains began.

[31]https://scholarship.richmond.edu/cgi/viewcontent.cgi?referer=https://www.google.com/&httpsredir=1&article=2131&context=masters-theses

[32]  Project Pelikan

[33]  Chile only declared war in 1943, having a sizeable German minority, and close trading links with Germany.  A moderate government eventually declared war, but the country played no active part in the war, though it supplied raw materials.  The spies monitored Allied merchant ships and listened in on Chilean naval communications.  When Department 50 broke up the spy rings there were arrests of 40 people and the collection of weapons, cash and plans for bombing mines in northern Chile.

[34]  https://www.smithsonianmag.com/smart-news/chile-foiled-nazi-plot-attack-panama-canal-documents-show-180963836/

[35]  Based at Balboa and responsible for the defence of the Pacific and Atlantic sea approaches to the Canal and for naval shore facilities in the Central America region during the war.

[36]  USS Erie.

[37]  Motor torpedo boats (or “PT Boats” in US Navy parlance).

[38]  The U-Boat involved, U-161, was lost with all hands off Bahia, Brazil 3 months later, after an attack by a US Navy patrol bomber.

[39]  U-153, there were no survivors.

[40]  U-654, once again there were no survivors.

[41]  However, in November, losses to U-Boats rose in the Trinidad area

[42]  The U-Boat involved went on to laid off the Gulf of Paria, Venezuela, again with little or no effect.

[43]  The U-516, it was eventually lost in the North Sea in 1945.

[44]  https://www.popularmechanics.com/technology/infrastructure/a22563978/titan-crane-herman-the-german/

[45]  It is described as a large, self-propelled crane vessel with the tip of its main boom standing at 374 feet above the typical water line.

[46]  http://www.discovernikkei.org/en/journal/2018/4/26/japanese-internment-panama/

[47]  Mixu Watanabe.

[48]  The Amano Maru, owned by Yoshitaro Amano.  He was later arrested and deported to Japan.

[49]  http://www.discovernikkei.org/en/journal/2018/4/26/japanese-internment-panama/

[50]  German, Italian and Japanese.

[51]  See also http://www.discovernikkei.org/en/journal/2018/4/26/japanese-internment-panama/

[52]  http://www.discovernikkei.org/en/journal/2018/4/26/japanese-internment-panama/

[53]  Immigration from Japan had risen throughout Latin America after the US prohibited Japanese immigration in 1924.  However, in 1936, Peru also prohibited Japanese immigration.  Ill feeling resulted in a 3-day race riot targeting Japanese Peruvian individuals, homes and businesses in May 1940.

[54]  https://www.pri.org/stories/2018-10-01/us-imprisoned-japanese-peruvians-texas-then-said-they-entered-illegally

[55]  Another 900 relocated to war torn Japan, where many had to restart their lives in a land and speaking a language that was foreign to them.  However, lawyers won a court order blocking the removal of 364 Japanese Peruvians, then secured temporary permission for them to remain as labourers in Texas.

[56]  Germany and Italy had pre-empted the US by declaring war on the US on 11 December.

[57]  2 such landings from U-Boats took place in the US in June 1943, with a total of 8 German agents being landed – all of whom were soon captured.

[58]  Leonard, Thomas M.; Bratzel, John F. (2007). Latin America during World War II. Rowman & Littlefield..

[59]  Leonard, Thomas M.; Bratzel, John F. (2007). Latin America during World War II. Rowman & Littlefield.

[60]  400-feet long, 5,220 tons displacement.  It could travel 37,500 nautical miles at 14 knots while surfaced, equivalent to going 1½ times around the world without refuelling.

[61]  A B1-class submarine, of 2,584 tons displacement, the I-25 used a E15K floatplane which dropped bombs on two occasions, setting fire to forests in Oregon.

[62]  Aichi completed the first prototype in 1943, and the Navy ordered production to start immediately.  The original production 44 aircraft was eventually reduced to 28 (including 2 M6A1-K trainers) due to the cost and war-driven material shortages, not to mention 2 major earthquakes and relentless bombing by B-29 bombers of Japan: https://www.historynet.com/japans-panama-canal-buster.htm

[63]  Lack of coordination between Germany and Japan, and other priorities meant that the bulk of the U-Boat fleet was operating in the Mediterranean or off Norway during the Winter 1941-42, i.e. when the US formally entered the war.

[64]  Interestingly, in 1917 the US had hurriedly acquired the Danish Virgin Islands, to counter a possible flaw in the canal’s defences, by ensuring they were not obtained by Imperial Germany.  The US paid $25 million in gold.  President Woodrow Wilson and his Secretary of State Robert Lansing hd feared that Germany might annex Denmark and then be launch attacks the islands.

[65]  https://history.army.mil/books/wwii/Guard-US/ch16.htm

[66]  https://www.chemistryworld.com/news/us-to-clean-up-race-test-chemical-weapon-relics-on-panama-island/3007758.article

[67]  Mustard gas damages DNA within seconds of making contact. It causes painful skin blisters and burns, and it can lead to serious, and sometimes life-threatening illnesses including leukaemia, skin cancer, emphysema and asthma.

[68]  https://www.envio.org.ni/articulo/1386

[69]  60,000 US troops were involved in the testing:  https://www.npr.org/2015/06/22/415194765/u-s-troops-tested-by-race-in-secret-world-war-ii-chemical-experiments

[70]  https://www.envio.org.ni/articulo/1386  Testing continued in Panama into the 1950s, and from 1953 to February 1957, the Tropical Test Team, a Chemical Corps unit that included 20 personnel, conducted tests of distilled mustard gas every 3 months in Panama.  These tests were held on the mainland, not on San Jose.  In 1961, the Army conducted a larger-scale exercise in the Darien in 1961, with a further exercise in 1964.  Records indicate tests with nerve gas also took place in Panama in the 1960s.  US military has also acknowledged “limited, controlled laboratory testing of some tear gas agents” in Panama since 1979.

[71]  https://www.envio.org.ni/articulo/1386

SRI LANKA ARRESTS EX-AMBASSADOR TO RUSSIA OVER MiG FIGHTER DEAL

On 14 February, RTL reported that Sri Lanka had arrested a former ambassador to Russia, Udayanga Weeratunga, after he was extradited from Dubai to face money laundering charges over a controversial MiG aircraft purchase.  He was arrested in connection with an investigation into the 2006 purchase of 4 second-hand MiG 27 from Ukraine.

https://today.rtl.lu/news/world/a/1470520.html

BAHAMAS: SUPREME COURT REJECTS CANADIAN BID TO ENFORCE $20 MILLION SANCTION AS UNENFORCEABLE “GOVERNMENT PENALTY”

On 14 February, Eye Witness News reported that a Supreme Court judge has rejected a bid by the Ontario Securities Commission (OSC) to enforce a $20 million sanction against a Bahamian resident – Wayne Pushka, ruling that it was a government penalty and not enforceable in the Bahamas.  The penalty dated from 2014, and the case involved a claim that nearly C$5 million were transferred to The Bahamas and the balance of C$13.5 million at issue to a trust company in Liechtenstein.  However, the judge noted that there was no allegation or suggestion that Pushka engaged in fraud of any kind and that thought it was possible for receivers to recover money for harmed investors, it was not, however, possible for foreign governments to enforce fines and penalties.

https://ewnews.com/judge-rejects-ontario-securities-commission-bid-to-enforce-20-million-sanction

PANAMA RETURNS TO EU TAX HAVEN BLACK LIST

On 14 February, Newsroom Panama reported that the EU has added Panama and the Cayman Islands to their blacklist of tax havens which was originally created following the Panama Papers scandal in 2017.  Panama had been removed from the EU blacklist in 2018 after committing to reforms but returns because it did not meet certain criteria.

https://www.newsroompanama.com/business/panama-returns-to-eu-tax-haven-black-list

OTHER THINGS YOU MAY HAVE MISSED – FEBRUARY 13

13 February 2020

HM TREASURY AMENDS 1 ENTRY ON DRC SANCTIONS LIST AND ISLE OF MAN FOLLOWS

On 13 February, a Notice from HM Treasury advised that the entry relating to Seka BALUKU had been amended.

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/865572/Notice_DRC_UN_130220.pdf

https://www.gov.im/news/2020/feb/13/financial-sanctions-democratic-republic-of-the-congo/

 

THE FUGITIVE FORMER HEAD OF MEXICAN STATE OIL COMPANY ARRESTED IN SPAIN

On 13 February, the Wall Street Journal reported that Emilio Lozoya, 45, former head of Petroleos Mexicanos, who has been a fugitive since May, when he was charged in 2 separate corruption probes for allegedly receiving more than $12 million in bribes from Brazilian construction company Odebrecht and a Mexican steelmaker.

 

FUGITIVE BULGARIAN GAMBLING TYCOON FIGHTS FOR HIS VAST TROVE OF ARTEFACTS

On 13 February, KYC 360 reported that Vasil Bozkhov, 63, amassed a trove of more than 3,000 archaeological artefacts said to be dating from 4,000 B.C. to the 6th Century. While their value is unknown, he has said that he was once offered €600 million for just part of it.  Bozhkov built his fortune from stakes in gambling, sports betting and lottery companies. His businesses in the past have also included road construction, insurance, banking and real estate.  He has been arrested in the UAE and Bulgaria is said to be seeking his extradition.

https://www.riskscreen.com/kyc360/news/fugitive-gambling-tycoon-fights-for-his-vast-trove-of-artifacts/

 

COLOMBIA SEARCHES AVIANCA AIRLINE OFFICES IN AIRBUS BRIBERY PROBE

On 13 February, KYC 360 reported that Colombia’s attorney general’s office has searched the offices of Avianca as part of an investigation into an alleged bribery scheme involving European manufacturer Airbus, and following the settlement for alleged bribery between Airbus and French, UK and US authorities.

https://www.riskscreen.com/kyc360/news/colombia-searches-avianca-offices-in-airbus-bribery-probe/

 

WARNING FOR UK CBD INDUSTRY AS REGULATOR SETS APPROVAL DEADLINE

On 13 February, an article on bdaily reported that the UK Foods Standards Agency has set a deadline of March 2021 and that products containing cannabis extract cannabidiol (CBD) are set to be “taken off the shelves” next year if they fail to gain regulatory approval.

https://bdaily.co.uk/articles/2020/02/13/warning-for-uk-cbd-industry-as-regulator-sets-approval-deadline

 

PUERTO RICO GOVERNMENT LOSES $2.6 MILLION IN PHISHING SCAM

On 13 February, AP reported that Puerto Rico’s government has lost more than $2.6 million after falling for an email phishing scam.  The Industrial Development Company had reportedly sent the money to a fraudulent account.

https://apnews.com/e03bea7e491b9c95350887880376562f

 

US: GRAND JURY INDICTS 3 TOP ADMINISTRATORS OF PHILIPPINE CHURCH IN SCHEME TO TRAFFIC WORKERS AND DEFRAUD IMMIGRATION SYSTEM

A news release from US Immigration & Customs Enforcement on 13 February advised that a federal grand jury has charged 3 top administrators of a Philippines-based church – the Kingdom of Jesus Christ, The Name Above Every Name (KOJC) – with overseeing a labour trafficking scheme that forced church members to solicit donations for a bogus charity after the defendants illegally obtained visas and other immigration documents that allowed the workers to enter and remain in the US.  The 3 were arrested last month.

https://www.ice.gov/news/releases/grand-jury-indicts-3-top-administrators-philippine-church-scheme-traffic-workers-and

 

KENYA: FAKE GOODS TAKE 40% MARKET SHARE

On 13 February, the Standard reported claims by the Anti-Counterfeit Authority (ACA) Chief Executive that agricultural inputs including fertiliser and pesticides, electronics and foodstuffs are the most affected goods, taking advantage of lax enforcement of regulations.  He also said 30% of alcoholic drinks in the market are counterfeit.

https://www.standardmedia.co.ke/article/2001360358/fake-goods-take-40pc-market-share

 

THE WORDS WHISTLEBLOWER AND ACCOUNTABILITY ARE NOT FOUND IN SPANISH

An opinion piece in El Pais on 11 February says that language is important in conveying the importance of things.  It says that whilst Spanish has many words for “corruption”, it is notable what terms it has no good equivalent.  For example, it says, in Spanish the word “whistleblower” does not exist – and the closest equivalents all have negative connotations, sounding more like snitch, sneak, toad or rat.  Another word is “accountability”, the nearest Spanish equivalents not having the same connotation, lacking the political or moral responsibility elements of the English term.  The author argues that it is time to adapt Spanish to accommodate new, better terms.

https://english.elpais.com/opinion/2020-02-11/how-is-corruption-like-snow.html

 

GERMAN ARRESTED FOR ILLEGAL DUAL-USE EXPORTS TO RUSSIA
UNIAN in Ukraine on 13 February reported that German prosecutors said that they had arrested a businessman identified as “Alexander S” on suspicion of exporting millions of euros in dual-use machinery to Russia that could be used for military purposes, in violation of EU sanctions.  The managing director of a company based in southern Germany, he is alleged to have sold machine tools to “military end users” in Russia, listing bogus end-users and incorrect information about the goods.

https://www.unian.info/world/10873448-german-arrested-for-illegal-military-exports-to-russia.html

https://www.euractiv.com/section/europe-s-east/news/german-arrested-for-illegal-military-exports-to-russia/

 

US: HOUSTON MAN SENTENCED FOR STEALING TRADE SECRETS TO BENEFIT CHINA

On 13 February, the Times Record reported that Shan Shi, 55, a Houston man has been sentenced to 16 months in prison for conspiracy to steal trade secrets from an oil-business technology company and use the information to benefit China.  He had been convicted in July 2019.  He has also been ordered to forfeit $330,000.  The case involved technology to develop a synthetic foam that is used in offshore oil and gas drilling, and Shi set up a company and hired former employees of the target company who had access to trade secrets of the manufacture of the product.

https://www.timesrecordnews.com/story/news/crime/2020/02/13/china-stealing-trade-secrets-oil-business-technology/4739174002/

 

TURKEY AND EXCLUSIVE MARITIME ECONOMIC ZONES IN THE MEDITERRANEAN

On 13 February, Modern Diplomacy carried an article on Exclusive Economic Zones (EEZ) in the context of the dispute over drilling and surveys in the waters around Cyprus and Turkish involvement in Libya.  It explains that an EEZ is the largest sea area – which cannot exceed 200 miles – in which a coastal State exercises its sovereign rights on the body of water for managing natural resources, such as fishing or the extraction of oil, gas or other substances, as well as for the ecological and biological protection of the marine environment.

https://moderndiplomacy.eu/2020/02/13/the-exclusive-maritime-economic-zones-in-the-mediterranean/

 

OHIO MAN CHARGED FOR LAUNDERING $300 MILLION THROUGH BITCOIN ‘MIXER’

On 13 February, various media reported that Larry Harmon is said to have used a facility called Helix, and partnered with AlphaBay, on the dark web to launder the equivalent of roughly $300 million for drug dealers and other criminals.

https://www.engadget.com/2020/02/13/man-charged-over-300-million-bitcoin-laundering/

https://www.cincinnati.com/story/news/2020/02/13/bitcoin-larry-dean-harmon-indicted-cryptocurrency-money-laundering-scheme/4746978002/

https://www.justice.gov/opa/pr/ohio-resident-charged-operating-darknet-based-bitcoin-mixer-which-laundered-over-300-million

 

FRENCH COURT RULES MONEY-LAUNDERING MAYOR IS TOO ILL FOR JAIL

On 13 February, The Local reported that Paul Balkany, 71, former mayor of Paris suburb, has been released from jail in France due to poor health, having been convicted in September 2019 for tax evasion and money laundering.  The Balkanys have dominated politics in the wealthy suburb of Levallois-Perret, just north of Paris, for decades. They are close friends of former president Nicolas Sarkozy, himself in the crosshairs of French prosecutors in a number of corruption cases.

https://www.thelocal.fr/20200213/french-court-rules-money-laundering-mayor-too-ill-for-jail

 

UK: TRANSPARENCY IN SUPPLY CHAINS – TOOLS FOR GOVERNMENT AND ITS SUPPLIERS

On 13 February, the Home Office published tools will help government procurers and companies who supply government to understand their role in ensuring transparency in their supply chains.

https://www.gov.uk/government/publications/transparency-in-supply-chains-tools-for-government-and-its-suppliers/tools-for-government-and-its-suppliers

 

UK: DOCUMENTS AND PROMOTIONAL MATERIAL RELATED TO THE GOVERNMENT’S WORK TO END MODERN SLAVERY

On 13 February, the Home Office published updated information that provides details about the government’s work to end modern slavery, including details about how to refer victims into the national referral mechanism (NRM).

https://www.gov.uk/government/collections/modern-slavery

 

UK: EXPERT WITNESS NOT FIT TO GIVE EVIDENCE GIVEN £89,000 WASTED COSTS ORDER

On 13 February, the Law Society Gazette reported that a consultant who acted as an expert witness in clinical negligence proceedings has been ordered to pay £88,800 to cover the costs wasted as a result of his input, and after he was found ‘not generally competent as an expert’ and not fit to be giving evidence.

https://www.lawgazette.co.uk/news/expert-witness-not-fit-to-give-evidence-slapped-with-89k-wasted-costs-order/5103091.article

 

EU TO GIVE TURKEY MORE TIME TO AVOID TAX BLACKLISTING

On 13 February, the Middle East Monitor reported claims that EU diplomats have reached a preliminary agreement to give Turkey more time to meet tax transparency requirements.  Turkey was required to adopt laws by the end of last year to automatically exchange tax information with EU states -but despite having been given more than one year to meet the requirement, it failed to do so by the set deadline.  The decision is described as “political”.

https://www.middleeastmonitor.com/20200213-eu-to-give-turkey-more-time-to-avoid-tax-blacklisting/

 

US CHARGES HUAWEI WITH RACKETEERING, ESCALATING CRACKDOWN ON TECH GIANT

On 13 February, CNN reported that the US government has charged Chinese technology giant Huawei with racketeering and conspiracy to steal trade secrets, according to a just-unsealed superseding indictment.  A third charge alleges that Huawei engaged in wire fraud to steal intellectual property. The 3 new allegations supplement more than a dozen other charges already lodged against the company.

https://edition.cnn.com/2020/02/13/tech/huawei-meng-new-charges-trade-secrets/index.html

 

CFTC SLAPS FLORIDA TRADER WITH $1.2 MILLION FINE FOR COMMODITIES FRAUD

On 13 February, Finance Magnates reported that Matthew R. White, 27, who pleaded guilty to a federal wire fraud charge has been fined for his role in a trading scheme that caused approximately 6 people to incur losses of more than $1.2 million.  He and his company M.W. Global Futures LLC have to pay a $200,000 civil monetary penalty and $883,974 in restitution, of which $602,003 has already been paid.

https://www.financemagnates.com/forex/regulation/cftc-slaps-florida-trader-with-1-2m-fine-for-commodities-fraud/

 

UTAH TAX RETURN PREPARERS INDICTED FOR TAX CRIMES

A DoJ news release on 13 February advised that an indictment has charged Sergio Sosa, and his adult children, Alissa and David Sosa, with conspiracy to defraud the US.  According to the indictment, Sosa owned and operated Sergio Central Latino (SCL), a tax return preparation business in Orem, Utah, where both Alissa and David worked.  Assessed by the IRS of owing some $750,000 in taxes, Sosa and his children allegedly agreed to obstruct IRS collection of the outstanding taxes by hiding Sosa’s personal assets, residential properties, and by titling SCL in the children’s names.

https://www.justice.gov/opa/pr/utah-tax-return-preparers-indicted-tax-crimes

 

OVERSEAS PAKISTANIS REMITTED $13.3 BILLION IN JULY-JANUARY 2020

The Gulf Times in its 14 February edition reported that Pakistanis residing in foreign countries continued to send higher remittances back home as more people went abroad and the FATF conditions forced them to utilise legal remittance channels.  Overseas Pakistanis remitted $13.30 billion in first 7 months of the current fiscal year, which was 4% higher than in the same period of last year.  In January alone, the remittances increased 9% to $1.9 billion compared to $1.74 billion in the same month of previous year.

https://www.gulf-times.com/story/655835/Overseas-Pakistanis-remit-13-3bn-in-July-Jan-perio

 

NCA SECURES FREEZING ORDER OVER LEEDS BUSINESSMAN’S £10.5 MILLION PROPERTY PORTFOLIO

On 13 February, a news release from the NCA advised that the freezing order prevents the sale of 17 addresses as part of an ongoing investigation into a Leeds businessman with suspected links to serious organised criminals.  The Property Freezing Order (PFO) covers properties in Leeds, Cheshire and London worth approximately £10.5 million, which are under the control of 39-year-old Mansoor Mahmood Hussain.

https://www.nationalcrimeagency.gov.uk/news/nca-secures-freezing-order-over-leeds-businessman-s-10-5-property-portfolio

 

CYPRUS TO REVOKE JHO LOW’S CBI PASSPORT

In his blog, on 13 February, Kenneth Rijock reported that Cyprus has announced that it intends to revoke the citizen-by-investment passport of Jho Low, currently a fugitive from justice in his native Malaysia, having allegedly stolen $4.5 billion from the 1MDB Malaysia Development Berhad, a sovereign wealth fund.

http://rijock.blogspot.com/2020/02/cyprus-to-revoke-billion-dollar.html

 

OECD PRESENTS ANALYSIS SHOWING SIGNIFICANT IMPACT OF PROPOSED INTERNATIONAL TAX REFORMS

A news release from the OECD on 13 February was concerned with new analysis that it says shows that a proposed solution to the tax challenges arising from the digitalisation of the economy under negotiation at the OECD would have a significant positive impact on global tax revenues.  It says that the analysis puts the combined effect of the 2-pillar solution under discussion at up to 4% of global corporate income tax (CIT) revenues, or $100 billion annually. The revenue gains are broadly similar across high, middle and low-income economies, as a share of corporate tax revenues.

http://www.oecd.org/tax/beps/oecd-presents-analysis-showing-significant-impact-of-proposed-international-tax-reforms.htm

 

NISSAN FILES $90 MILLION LAWSUIT AGAINST CARLOS GHOSN

On 13 February, Jurist reported that the lawsuit was filed in Japan and claims that it is “a result of years of misconduct and fraudulent activity” by Ghosn.  Nissan based the $90 million in costs upon “corrupt practices,” including Ghosn’s private use of corporate jets and payments to his sister.  Nissan is also asking for costs associated with its internal investigation of Ghosn.

https://www.jurist.org/news/2020/02/nissan-files-90-million-lawsuit-against-carlos-ghosn/

 

PAKISTANI COURT CONVICTS HAFIZ SAEED, FOUNDER OF LASHKAR-E TAIBA (LET)

On 13 February, Jurist reported that a Pakistani court had convicted him on charges of collecting funds from different cities in Pakistan’s Punjab province to finance terrorism through assets made and held ostensibly for charitable purposes.  He is the alleged mastermind behind the 2008 Mumbai terror attacks.

https://www.jurist.org/news/2020/02/pakistan-anti-terrorism-court-convicts-hafiz-saeed-in-two-terror-financing-cases/

 

CZECH REPUBLIC AND SLOVAKIA: SCAMMERS ARRESTED AFTER EVADING €7.2 MILLION IN TAX

On 13 February, a Europol news release reported the arrest 23 people suspected of tax evasion through employment agencies in the Czech and Slovak Republics.  Criminals used employment agencies to send foreign workers to manufacturing companies in Czechia. The owners of these agencies created a large group of companies to provide false invoices and evade VAT and income tax.

https://www.europol.europa.eu/newsroom/news/scammers-arrested-after-evading-€72-million-in-tax

 

METAL THIEVES IN FRANCE AND ROMANIA ARRESTED FOR THEFT FROM RAILWAY

On 13 February, a news release from Europol advised that a gang of metal thieves believed to have caused over €1 million of damage to the French national railway company (SNCF) has been dismantled following a series of coordinated actions across Romania with the active involvement of Europol.  The criminal network is linked to 57 cases of theft of approximately 1,000 metal components of locomotives weighing 38 tonnes.

https://www.europol.europa.eu/newsroom/news/metal-thieves-arrested-in-france-and-romania-for-great-train-robbery

 

SATELLITE IMAGES SHOW EVOLUTION OF ILLEGAL GOLD MINING IN PERU

On 13 February, Insight Crime carried an article saying that satellite images show that while military operations against illegal mining in Peru’s Madre de Dios region might be paying off, the same fight is not yet being waged in other parts of the country.  It says that illegal mining continues to decimate Peru’s Amazonian forests.

https://www.insightcrime.org/news/brief/satellite-images-gold-mining-peru/

 

US NAVY SEIZES SUSPECTED IRANIAN WEAPONS CACHE IN ARABIAN SEA

On 13 February, Rferl reported that the USN has said that it seized advanced weapons and weapon components – including more than 150 Dehlavieh anti-tank guided missiles and 3 Iranian surface-to-air missiles – believed to be of Iranian “design and manufacture” intended for Huthi rebels in Yemen.  They were seized from a stateless dhow in the Arabian Sea.

Meanwhile, Janes.com carries an article saying that he latest report from the UN Panel of Experts on Yemen has revealed that a Quds-1 cruise missile, a C802 anti-ship missile, and what it believes were surface-to-air missiles (SAM) of a previously unseen type were seized by destroyer USS Forrest Sherman on 25 November.

https://www.rferl.org/a/us-navy-seizes-suspected-iranian-weapons-cache-in-arabian-sea/30433104.html

 

CEO FRAUD ON RISE AS HACKERS STEAL $3.5 BILLION ACROSS US IN 2019

On 13 February, illicit Trade reported that the FBI’s Internet Crime Complaint Centre (IC3) has revealed that 2019 saw both the highest number of complaints and the highest dollar losses related to cyber offences since it was established almost 20 years ago.  Business email compromise (BEC) attacks, confidence/romance scams and spoofing were the top 3 cyber crime types in terms of reported monetary losses, according to IC3.  The agency noted that the most prevalent forms of cyber crime in 2019 were phishing and its derivatives, non-payment/non-delivery scams, extortion, and personal data breach.  The article says that IC3 recorded 23,775 complaints about BEC attacks in 2019, which resulted in losses worth some $1.7 billion.

https://www.illicit-trade.com/2020/02/ceo-fraud-on-rise-as-hackers-steal-3-5-billion-across-us-in-2019-fbi-reveals

 

11 ARMED ROBBERIES AGAINST SHIPS IN ASIA IN JANUARY 2020, BUT NO PIRACY CASE REPORTED

On 13 February, Hellenic Shipping News carried news of the latest report from the ReCAAP Information Sharing Centre.  The report also says that there was 1 incident of abduction of crew that occurred off East Malaysia.

https://www.hellenicshippingnews.com/recaap-11-armed-robberies-against-ships-in-asia-in-january-2020-but-no-piracy-case-reported/

 

 

FATF PUBLISHES AML/CFT MUTUAL EVALUATION REPORTS ON GIBRALTAR AND CYPRUS, AND UPDATED CONSOLIDATED SCHEDULE OF AML/CFT RATINGS

On 13 February, FATF published reports on Cyprus and Gibraltar, already published by the FATF-style regional body, MONEYVAL.  On the same date it also published an updated schedule of consolidated AML/CFT ratings, incorporating updated results, including Switzerland.

http://www.fatf-gafi.org/publications/mutualevaluations/documents/mer-gibraltar-2019.html

http://www.fatf-gafi.org/publications/mutualevaluations/documents/mer-cyprus-2019.html

http://www.fatf-gafi.org/publications/mutualevaluations/documents/assessment-ratings.html

SWITZERLAND: AML/CFT MUTUAL EVALUATION FOLLOW-UP REPORT

On 13 February, FATF published the 3rd enhanced follow-up report on Switzerland, which follows up on developments since the original mutual evaluation report in 2016.  As with other such reports, it addresses changes and re-rating of technical compliance to FATF Recommendations, and not effectiveness.  The report also addresses new FATF Recommendations since the 2016 report.  As a result of progress, Switzerland has been re-rated on the following FATF Recommendations: 8, 16, 19 and 33. The FATF welcomes the progress achieved by Switzerland in order to improve its technical compliance with Recommendations 2, 5, 10, 15, 18 and 21 – but the progress is judged insufficient to justify an upgrade of the rating of these Recommendations.  Finally, Switzerland remains largely compliant with revised Recommendation 15 and compliant with the revised Recommendation 7.  However, Switzerland remains in enhanced follow-up.

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http://www.fatf-gafi.org/media/fatf/documents/reports/fur/Follow-Up-Report-Switzerland-2020.pdf