$200 Million in Cocaine, Delivered By Submarine

If you think we’re winning the war on drugs, you’re in the dark as to what the other side has been up to lately. 

Border seizures of vehicles and human “mules” carrying narcotics may be on the rise, but it’s only forced the cartels to ramp up their efforts both in terms of volume and methodology.

As is the case with any modern war, before long, the battle of wills becomes a battle of technological prowess.

What the cartels are doing now to get around the intensifying efforts of the DEA to halt the flow of illegal drugs requires more than a handful of federal agents showing up in body armor, assault rifles drawn…

It requires a military-style response from the Coast Guard and Navy involving ships, helicopters, and an anti-submarine warfare–specialized aircraft.

This past March, an improvised submersible craft traveling close to American waters in the Eastern Pacific was intercepted by U.S. Customs and Border Protection Air and Marine Operations.

With the help of a U.S. Navy P-3 Orion Maritime Patrol aircraft, this homemade vehicle was spotted and later intercepted by Coast Guard helicopters.

The craft, operated by just a handful of men, was carrying six and a half tons of cocaine — worth close to $194 million on the streets of American cities.

It may seem shocking to the uninitiated that cartels are taking such radical steps to keep the flow of product uninterrupted, but the fact is, this approach has become an almost common thorn in the side of the agencies trying working against it.

Always a Step Ahead of Us

As early as 1997, cocaine smugglers were plotting to purchase decommissioned Soviet diesel submarines for just this purpose.

They proved hard to acquire and too big and noisy to reliably get through American sonar nets, however, so the simpler and more efficient solution was to fabricate these submersibles and semi-submersibles themselves.

With a production cost of around $1 million, these improvised craft can carry hundreds of times that value in product, making them well worth the risk if even for just one successful run.

What happened in March off the coast of California sounds like a major victory, but the problem is that for every one that’s caught, far more get through.

In 2014, 80% of illegal drugs entering the U.S. came by water… and 30% of that came onboard an improvised “narco submarine.”

DEA analysts estimate that at best, only one out of 10 drug runs using this new method ends in failure, as this one did.

After the submersible in question was intercepted and its crew apprehended, it was swamped in heavy seas and sank, destroying key evidence.

Most do get through, experts agree… which doesn’t just present a serious problem for the illegal drug problem in the U.S., but also underscores a bigger issue with maritime border security.

The U.S. spends more money on defense than the rest of the world combined, and yet our coastlines — all 95,000 miles of them — aren’t safe from the most primitive breach attempts.

This Isn’t the Problem… It’s a Symptom

If the cartels can cobble together relatively basic watercraft that readily defeat our defenses, what could a more dangerous, better-equipped enemy manage?

Iran, for example, builds an entire line of small, quiet, hard-to-detect miniature submarines.

Called the Ghadir, this 95-foot submarine can easily be mistaken for a whale — and that was the intention.

Designed to harass modern navies such as the kind operated by their main regional rival — Israel — the Ghadir takes partisan warfare into a realm once reserved for the world’s most powerful nations.

Where large, multibillion-dollar Cold War–era nuclear-driven submarines can be seen or heard coming from a mile away, these cheap, disposable vehicles are all but immune to defenses designed to combat a naval superpower like the kind the U.S.S.R. was in its heyday.

The Department of Defense, however, is quite aware of that.

When in Doubt… Automate

What the Department of Defense is doing today to close this tactical gap closely resembles its response to the emergence of insurgent warfare on the ground.

Instead of risking lives and expensive, heavy equipment, technology — in the form of autonomous drones — is now about to take the burden of finding and neutralizing hard-to-detect underwater threats.

It’s one of the newest niches in the defense industry, but if the market for seagoing drone technology follows the path that its airborne cousins started down two decades ago, it will also be one of the fastest growing.

Israeli defense forces, along with a handful of others located in contested areas around the globe, are already investing heavily in this technology.

Interestingly, though, it’s not the biggest defense contractors in the world whose designs are currently the frontrunners to become the standard, the way the Predator drone did back in the early 2000s.

Instead, it’s a small tech company, started by a small group of industry veterans, that’s being eyed by a number of national governments — ours included — as a major supplier in this emerging field.

I learned about this company last year, and after realizing the potential, I created an entire presentation on what it’s doing, why, and why it’s the best.

It’s free to view. Just click here.

Fortune favors the bold,

Alex Koyfman

Check us out on YouTube!

His flagship service, Microcap Insider, provides market-beating insights into some of the fastest moving, highest profit-potential companies available for public trading on the U.S. and Canadian exchanges. With more than 5 years of track record to back it up, Microcap Insider is the choice for the growth-minded investor. Alex contributes his thoughts and insights regularly to Energy and Capital. To learn more about Alex, click here.