SACRAMENTO, Calif. (AP) — International criminal
enterprises follow the money, and a report being released Thursday says
they are increasingly focusing on California because of its wealth and
innovation.
Aside from long-time trafficking in drugs, guns and
people, the report by California Attorney General Kamala Harris says
criminals are turning to cybercrime to target businesses and financial
institutions.
It calls California the top target in the U.S. for
organizations that often operate from safe havens in Eastern Europe,
Africa and China.
"California is a global leader on a number of
fronts and, unfortunately, transnational criminal activity is one of
them," the report states.
Harris said it is the first
comprehensive report to outline the effects international criminal
organizations are having on Californians and businesses in the state.
She is set to formally release the 181-page report during a late-morning
news conference with other law enforcement officials in Los Angeles,
but an early copy was provided to The Associated Press.
California
leads all states in the number of computer systems hacked or infected
by malware, the number of victims of Internet crimes, the amount of
financial losses suffered as a result and the number of victims of
identity fraud. The report says the state also is particularly
vulnerable to thefts of intellectual property because of its leading
role in developing new technologies and mass-media entertainment.
"Not
surprisingly, transnational organized crime has tapped into this new
criminal frontier," the report says. "Many of these breaches have been
tied to transnational criminal organizations operating from Russia,
Ukraine, Romania, Israel, Egypt, China, and Nigeria, among other
places."
California’s gross domestic product of $2 trillion,
significant foreign trade activity and border with Mexico also makes the
state an easy target for international money-laundering schemes, the
report says. It estimates that more than $30 billion is laundered
through California’s economy each year.
Some is filtered through
legitimate businesses or by using virtual currencies such as Bitcoin.
But the report says backpacks and duffel bags stuffed with cash have
been seized more frequently since Mexico began toughening its
money-laundering laws in 2010.
Seizures of bulk cash increased 40 percent by 2011 in California, which now leads the nation in the
number of currency seizures.
California
should alter state law to make it easier for prosecutors to crack down
on money laundering, the report says. Unlike federal law, state law
currently requires prosecutors to prove that a suspect deliberately
carried out a financial transaction in a way designed to hide the fact
that the money came from or was used for a criminal activity.
The
report also recommends that the Legislature change state law to let
prosecutors temporarily freeze the assets of transnational criminal
organizations and associated gangs before they seek an indictment.
It
also calls for the state to devote more money to the state Department
of Justice, which Harris leads. That would include $7.5 million to fund
five new teams that would target international criminals.
Copyright 2014 The Associated Press. All rights
reserved. This material may not be published, broadcast, rewritten or
redistributed.