Deadly business

Pirates demonstrate coordinated logistics approach in spreading mayhem.

By Eric Kulisch

   In the last year, pirates have quadrupled their zone of operation in the Indian Ocean, from 600 nautical miles off the coast of East Africa to the tip of India, and have become more violent.
   A multinational military presence has reduced the rate of successful hijackings, but the number of ship takeovers has increased because pirates launched many more attacks since 2009. And it has pushed the pirates away from the Gulf of Aden and the Horn of Africa into a much wider, indefensible area for vessels targeted by pirates.
   By late this year or early 2012, Somali pirates will be targeting merchant ships off Sri Lanka and making arrangements to extend their influence east to the Straits of Malacca, said Michael Frodl, a Washington-based attorney and head of independent consultancy C-Level Maritime Risks.
   The number of armed attacks and hijackings off the Somalia Coast surged in the first quarter to 97, compared to 35 in the same period in 2010, according to the International Maritime Bureau. Year-to-date there has been 139 incidents and 21 hijackings. Seven hostages have been killed. More than 439 seafarers and 23 vessels were being held as of June 14 while their captors await ransom payments.
   In 2010, pirates captured 1,181 sailors aboard 53 vessels and several captives died or were killed while under control of the pirates, according to EU Naval Force Somalia. Sixty-two seafarers have died in the past four years as a direct result of piracy in the Gulf of Aden and Indian Ocean, through deliberate murder by pirates, suicide during captivity, and death from malnutrition and disease, drowning, or heart failure just after the hijacking, according to a coalition of commercial maritime organizations urging governments to take more military and legal action against pirates.
   The continued payment of ransoms has fueled the spread of piracy, a lucrative cottage industry in a country without a functioning economy. The average ransom has reached $5.4 million, an insurance industry report said, with one payment (for release of the South Korean tanker Samho Dream in November) reaching $9.5 million, and another in April for $13.5 million (for release of the Greek-flagged tanker Irene SL, owned by First Navigation Special Maritime Enterprises).
   Since January 2010, Somali pirates have received $75 million to $85 million in ransom payments, according to the U.S. State Department. One Earth Future Foundation, a non-profit group that is trying to organize public-private partnerships to deter piracy, recently said $238 million was paid in ransoms to Somali pirates last year. But no one truly knows the exact amount because those involved do not publicize their negotiations.
   Pirates have progressively moved away from coastal to deep-sea interdictions to avoid naval forces.
   The vast majority of vessels hijacked by Somali pirates took place east and northeast of the Gulf of Aden, where pirates originally preyed on merchant vessels and which is now patrolled by an international coalition of naval forces. But pirate attacks have now been reported in the Red Sea and as far south as Mozambique and the Maldives Islands off the southwestern coast of India.
   Frodl said displaced pirates moved their target zone to the energy lanes beyond the Strait of Hormuz because the tanker-rich environment would attract bigger ransoms necessary to offset the extra overhead from operating for longer periods at sea.
   The geographic expansion of pirate activity to an area of 2.85 million square miles means there are no alternative routes, especially for tankers leaving the Persian Gulf, and that vessels can spend five or more days in pirate-infested waters. It also means naval forces can’t reach many merchant ships in time to disrupt an attack.
   The turmoil in Yemen, and the potential lack of a functioning government, could also open the door for criminals or terrorists to set up shore-side infrastructure and raid merchant ships from the other side of the Gulf of Aden, some experts believe.
   Pirates have also changed their tactics, frequently using hijacked ships with human shields as mother ships that can operate at extended range in all weather conditions. Three years ago pirate activity tended to die down during monsoon season because the seas were too rough for small fishing dhows to operate. The bigger ships, acting as a forward base, can carry dozens of pirates and tow several small attack boats capable of multiple, simultaneous attacks.
   The use of hostages onboard ships was also a reaction to military attempts to blockade Somali ports so pirates could not get to sea.
   The maritime bandits are also becoming more aggressive. Gangs often send a reconnaissance boat ahead and then swarm a vessel from all sides if there is no response, or abandon the attack if armed guards appear on deck. Now, pirates retreat less often and bring in the full force, even if the first skiff takes fire, in a concerted effort to take their target, said Tom Rothrauff, head of private security firm Trident Group.
   Gangs of sea robbers have also used blowtorches to open citadel rooms on ships where crews retreat for safe haven until rescuers can arrive.
   Pirates’ use of torture and violence has also become more common, most tragically underscored by the killing this year of four U.S. citizens on their private yacht SV Quest. Pirates are no longer perceived as humane criminals who treat their hostages well as an incentive for ship owners to pay ransoms.
   According to the industry’s Save Our Seafarers Campaign, examples of torture against sailors include being hung by the ankles over the side of the ship, dragged behind ships, shut in the ship’s freezer room, and being beaten, punched and kicked. Crew accounts of psychological abuse include solitary confinement, calling family members while threatening hostages, mock executions and taking hostages ashore to see their supposed graves.
   Pirates have also beaten kidnapped crewmembers on deck to get naval warships to back off their pursuit, and have taken hostages from a previous hijacking to another vessel where the crew is hiding in a citadel and threatened to kill them if the people inside don’t come out, according to One Earth Future (OEF).
   Gangs ‘have become more violent, but they’re still not interested in dead hostages,’ said Martin Murphy, a prolific pirate historian and author who does research at the Corbett Center for Maritime Policy Studies at Kings College in London. ‘They’re interested in frightened hostages.’
   Criminal enterprises in Somalia are financing their operations and expanded capabilities by selling shares in upcoming attacks, promising investors a portion of projected ransom payments, U.S. Chief of Naval Operations Adm. Gary Roughead said in an interview with Bloomberg published on April 22.
   ‘The ransoms fuel the business; the business invests in more capability ‘ either in a bigger boat, more weapons, better electronic-detection means to determine where the ships are,’ Roughead said. ‘So it’s a business.’
   U.S. Naval War College Professor James Kraska wrote last year that ‘there is an illicit small pirate secondary market, or ‘stock exchange’ in Harardhere, where ordinary Somalis can buy shares of a piracy operational account by contributing money or weapons to the sea gangs in return for payment of a dividend when ransoms are paid.’
   The admiral added that pirates are hiring and paying crew based on their skills or weapons they can offer.
   In at least one case ransom payments appear to have contributed to the downfall of an ocean carrier. South Korea’s Samho Shipping filed for bankruptcy protection in April, months after it paid $9.5 million for the supertanker Samho Dream. In January, the Samho Jewelry was freed by South Korean commandos in a raid in which eight pirates were killed and five captured.
   The captured pirates were quoted as saying they attacked the Jewelry because they knew Samho, which leases its ships, would pay ransom.
   High bunker fuel prices, low freight rates and other factors hurt the bottom line, but ransom and other costs (including legal fees) associated with the hijackings appear to have pushed Samho Shipping over the edge.
   Somali pirates released the Beluga Nomination and its 12-person crew in April after receiving a multimillion-dollar ransom. The vessel was commandeered on Jan. 22 in the Arabian Sea. One crewmember was killed by pirates during a botched rescue attempt by the Seychelles Coast Guard.
   In October, German and European Union forces rescued the Beluga Fortune after it was seized by pirates in the Indian Ocean.
   Beluga Chartering, the primary operating unit of German heavy-lift carrier Beluga Shipping GmbH, went out of business in March following an investigation into financial improprieties. What role, if any, piracy costs played in the shutdown is unclear.
   India has been particularly noteworthy in taking aggressive action against pirates who are raiding commerce in the country’s exclusive economic zone (EEZ), which extends about 200 miles offshore. Earlier this year the Indian Navy disabled three vessels, rescuing 57 hostages and capturing 104 pirates who are being prosecuted in India.
   In one March incident, India’s navy and coast guard captured 61 Somali pirates and rescued 16 crewmembers from an Iranian trawler after a three-hour battle off India’s western Laccadive Islands, the navy said.
   Pirates temporarily seized a Chinese bulk carrier on May 4 about 500 nautical miles off the coast of Mumbai, India, before fleeing when Indian Navy forces responded and warned them via radio, according to India Today. The crew hid in a secure citadel room until rescue forces arrived on the scene.
   The same day, a 3,400-TEU containership operated by Evergreen Marine subsidiary Italia Marittima sustained damage from rocket-propelled grenades, but was able to fend off attackers with fire hoses and evasive maneuvers. The ship was attacked about 500 miles west of the Indian port city of Karwar en route from Malaysia to Saudi Arabia.
   The Indian government characterized as unjustified a recent agreement between the International Transport Workers Federation and ship owners to extend the piracy risk zone into its territorial waters, claiming they are safe from sea marauders, according to an Agence-France Press story.
   The designation places extra responsibility on vessel operators to take security precautions and pay compensation to seafarers if their vessel is targeted or if they are injured or killed.
   Last December the Joint War Committee at Lloyd’s of London expanded the area where ‘war risk’ premiums have to be paid up to India’s western territorial waters.
   ‘Pirates go to where their targets are. By moving closer to Indian waters they have effectively pushed the Indian navy back towards its own coast, whereas before they’d been operating forward in defense of Indian fishing vessels and others’ across the ocean, Murphy said.
   Pirates have been able to effectively operate off India because of forward bases and supplier relationships they’ve established in the Maldives Islands for fuel and provisions, Frodl said. In addition to paying cash for supplies, the pirates are promising a share of ransoms to people who provide surveillance or tips about ships passing through the region that are worth attacking.
   But Frodl and Murphy warned that India’s enforcement campaign will simply displace pirates once again. The pirates have begun to pull back outside India’s EEZ, staying just west of Indian patrols and east of the Internationally Recognized Transit Zone to avoid coalition forces. That has made the Arabian Sea just south of Oman one of the hottest spots for piracy in recent months.
   ‘The SV Quest is the first direct consequence of the Indians doing such a great job’ policing its waters, Frodl said.
   Hardcore pirates with better financing, logistics and planning capabilities have their eyes on moving even further south near the island of Minicoy, according to C-Level Maritime Risks’ recent long-range forecast.
   ‘The more aggressive, better bankrolled pirates are moving there and going to take advantage of the fact that the Indians won’t patrol outside EEZ and the Sri Lankans won’t patrol outside their territorial waters,’ Frodl said in an interview.
   By the end of the year the new hot spot for pirate activity will be south of India and Sri Lanka, he predicted.
   ‘The Somali pirates are exploring further collaboration with the remnants of the Tamil Tigers out of Sri Lanka who in the past have sold weapons to them via Eritrea, and now our greatest fear is a coordinated assault between the Somali pirates and the remnants of the Tamil Sea Tigers against commercial navigation in the waters south of India and Sri Lanka,’ Frodl said.
   The Tamil Tigers is a militant separatist movement that engaged in a bloody 30-year struggle to wrest control of the northeastern part of the island until two years ago, when its leader was killed and the group was crushed by a major Sri Lankan government offensive.
   In an address to the Sri Lankan parliament in early June, Prime Minister D.M. Jayaratne said there were reports the rebels are trying to reconstitute their organization. News stories from the region indicate that Tamil Tiger supporters and activists are openly operating in several western countries.
   The insurgent group can provide the Somalis crewmembers, weapons, advice on navigating local waters, and logistical support while the Tigers hope to gain a share of ransoms to fund the resurgence of their rebellion and terrorism, said Frodl, who claims maritime insurers among his clients.
   The Tigers, according to Frodl, have underground offices in Thailand, Malaysia and Burma, from where they engage in drug smuggling and gun running to raise money. The Somali pirates would be keen to leverage those resources to reach the shipping lanes of the Straits of Malacca if their strategic partnership in the southern Indian Ocean proves successful, he said.
   Somali pirates could be operating in the commercial shipping lanes leading to the west end of the Straits of Malacca by spring of 2012, he warned.
   They could strike up deals with local pirates or criminal groups in remote Indonesia islands, where central government control is mostly absent, not to do attacks but to hold hostages on land, he added.
   Within a couple years, Frodl surmised, the Somali pirates could end up in the South China Sea, collaborating with Muslim rebels in the Philippines.
   ‘One of the concerns is that if the Indian navy is successful that the pirates will move south to points like Sri Lanka and Dondra Head and then go straight into the Straits of Malacca,’ Murphy concurred. (Dondra Head is a cape at the extreme southern end of Sri Lanka.)
   Pirates might soon launch attacks in the Andaman Sea at the southern end of the Bay of Bengal ‘ essentially the sea space between Sri Lanka and the Straits of Malacca, he said.
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