U.S. Companies Found Importing Illegal Timber

By Alexandra Stark

A new investigative report by the Environmental Investigation Agency finds that more than 21 U.S. companies have imported millions of dollars in illegally logged timber from the Peruvian Amazon since 2008.  The trade violates US and international endangered species laws, as well as the US-Peru Free Trade Agreement, and leads to devastating environmental and human rights impacts.

The report, “The Laundering Machine: How Fraud and Corruption in Peru's Concession System are Destroying the Future of its Forests,” documents the results of a multi-year investigation that involved analysis of official documents as well as investigative field work in the remote depths of the Peruvian Amazon rainforest.  It found that at least 112 illegal shipments of cedar or mahogany wood - accounting for 35 percent of the total trade in these protected species between Peru and the U.S. - were illegal.  The report’s authors contend that they would have discovered an even higher number with access to more complete data. Of these illegal shipments, at least 45 percent were imported by Alabama-based Bozovich Timber Products, Inc.

This trade violates the U.S. Lacey Act, which prohibits commercial transactions in wood that has been illegally sourced, and the U.S.-Peru FTA, which contains provisions preventing illegal timber trade, as well as the U.S. Endangered Species Act (cedar and mahogany are protected species).  EIA plans to submit the information that it has collected through the investigation to U.S. authorities, and will call for an official investigation by U.S. agencies.

The timber is laundered by often-corrupt timber barons.  Typically, forest concession owners submit an annual harvest plan with lists of ‘imaginary’ trees that don’t actually exist on their land, with the complicity of local authorities, who approve the extraction and sale of this non-existent wood.  The resulting permits are then sold on the black market and used to launder wood that has been extracted illegally from elsewhere, often national parks or protected indigenous lands. Although the wood is accompanied by documents attesting to their legality, “pervasive laundering and corruption have been open secrets in Peru’s wood trade for years,” said Andrea Johnson of EIA. “Any exporter or importer still relying only on paper permits to claim legality should know better by now.”

The report documents recorded testimonies of men and women who experienced horrific human rights violations, including forced labor and sexual slavery.  It includes testimonials from migrant workers who go without pay for months after finding themselves trapped in camps located deep in the jungle, and members of indigenous communities left with massive debts after they are swindled out of access to their valuable forest by intermediaries.  While illegal loggers often claim that such logging increases economic development, according to EIA’s Julia Urrunaga, “Peru’s current logging industry is a model that has nothing to do with meaningful economic development. The real human toll of these illegal practices is demeaning and ugly.”

The illegal timber trade also has harmful ecological and climate impacts.  The Peruvian Amazon is one of the most biodiverse areas on Earth, with the largest number of bird species and third largest number of mammal species in the world.  The entire Amazon rainforest, of which Peru has the second largest portion behind Brazil, accounts for one in ten of all known species on Earth. Globally, deforestation causes 17 percent of total greenhouse gas emissions.  The Amazon itself contains 90-140 billion metric tons of carbon.

But aside from such devastating environmental and human rights impacts, the illegal timber trade also impacts businesses’ bottom line.  Illegal logging undermines legitimate traders and importers, forcing them to compete on an unfair playing field.  EIA’s report demonstrates just how bad the shadowy trade in illegally logged Peruvian timber and systemic corruption is for the triple bottom line.

Image Credit: ChristopherTitzer, Flickr