MSC Spends $100 Million on Security Upgrades After Cocaine Mega-Bust

CBP officers seize cocaine from a container from the boxship MSC Gayane, June 2019 (CBP)

Published Apr 7, 2021 5:45 PM by The Maritime Executive

Number-two ocean carrier MSC says that it has begun spending tens of millions of dollars every year on extra security enhancements in the wake of the multi-billion-dollar cocaine bust aboard the boxship MSC Gayane. American prosecutors assert that crewmembers aboard the Gayane brought 15.5 tonnes of cocaine on board, then transported it to the United States. U.S. Customs and Border Protection intercepted the shipment at the Port of Philadelphia in June 2019, and it estimated the narcotics' total value at $1.1-1.3 billion, making it the largest single drug bust in the agency's history. The interdiction resulted in a temporary seizure of the ship and MSC's (brief) suspension from the U.S. Customs Trade Partnership Against Terrorism, or CTPAT.

The 10,000 TEU MSC Gayane called at ports in the Bahamas, Panama, Colombia and Peru prior to her arrival in Philadelphia. According to charging documents, members of the Gayane's crew brought the drugs aboard during multiple rendezvous with small boats at sea, then concealed the narcotics in containers. Local media reported that the shipment of cocaine was ultimately intended for delivery in the Netherlands and France, where wholesale prices are higher than in America. 

The carrier itself has not been charged in connection with the smuggling incident, but prosecutors indicted seven former members of the Gayane's crew, identified as Ivan Durasevic, Fonofaavae Tiasaga, Bosco Markovic, Alekandar Kavaja, Nenad Ilic, Vladimir Penda and Laauli Pulu. In a new "victim's statement" filing in the trial of Vladimir Penda, who pleaded guilty to smuggling charges last June, MSC described itself as a victim of crime and pointed to the financial and reputational impact of the interdiction.

"You will understand how distressed and upset all of MSC’s 27,000 plus employees and crew members are, and also in particular the family that continues to own MSC, to have their over 50 years of work building the company . . . undermined by the criminal conspiracy involving [Penda]," MSC's counsel wrote in a filing for Judge Harvey Bartle III. "Everyone at MSC is justifiably proud of the company’s continuing success and reputation. The Gayane incident is an unwanted and undeserved stain on their record. The company and everyone in it are victims."

MSC said that over the two years since the Gayane incident, it has spent tens of millions of dollars to boost its anti-smuggling systems. This includes expanded deployment of teams of onboard security guards and onboard CCTV cameras monitored remotely by third-party security specialists. MSC has also added routine vessel inspections by canine units and diver teams, particularly in its South American markets. It has also invested in rapid development and rollout of "smart containers" that can issue an alert if someone breaches or tampers with the box. 

In total, MSC’s post-Gayane security investments are projected to cost more than $100 million from 2019 through 2024, the company said.