Captain James Staples on International Piracy

JULIA TAYLOR KENNEDY: Welcome to Just Business, a series of interviews about global business ethics. I'm Julia Taylor Kennedy.

This time we're looking at the threat of piracy and the ethical questions it raises for shipping companies and others doing business in or near the Gulf of Aden.

I'm here with Captain Jim Staples, a merchant marine and consultant, who can give a background on piracy and its explosion in recent years. Captain Staples is a master mariner with the U.S. Merchant Marines and runs a consulting company, Ocean River LLC, that specializes in assessing ships for their vulnerability to pirate attack. He recently returned from a NATO conference on piracy.

Captain Staples, thanks so much for joining me on Just Business.

JAMES STAPLES: Thank you for having me.

JULIA TAYLOR KENNEDY: When did piracy really start to heat up off the coast of Somalia in the Gulf of Aden?

JAMES STAPLES: Approximately six years ago, we started to see the pirates start to extend their range. They had been off the coast, primarily just going after fishing vessels and small vessels that were fishing in their waters.

JULIA TAYLOR KENNEDY: Why has there been such an increase in piracy in that region of the world?

JAMES STAPLES: Number one is the instability of Somalia. There is no formulated government there, and it's a lawless country where there is no Coast Guard; there's nobody to prevent them from doing this.

JULIA TAYLOR KENNEDY: How have shipping companies responded to this increased threat?

JAMES STAPLES: Shipping companies put in place what they call best management practices, which is a series of events that take place onboard a ship to try to deter and defend a vessel against piracy, mainly with notification to UKMTO [UK Maritime Trade Operations] about your sail plan as well as position reporting.

JULIA TAYLOR KENNEDY: What is UKMTO?

JAMES STAPLES: It's an organization that's part of NATO. They are the organization that monitors ship traffic out there.

They have put in place a few things that the ships can do themselves as far as basic maneuvers and vigilance between the crew, watch keeping. They are very primary things that haven't really stopped piracy but they have thwarted them to where the pirates are now venturing out into a great part of the oceans.

JULIA TAYLOR KENNEDY: Some of these changes are pretty basic—height of the ship deck from the ocean and some other changes that you would think would have been in place before the pirate attack increase.

JAMES STAPLES: Everything that has been done for the ships is for a non-lethal-type event that is going to take place onboard the ship.They want you to put barbed wire up and extend the lookouts. But it has all been non-lethal.

As we see, the pirates are advancing in their techniques, to the point where they're using mother ships, which are now being referred to as pirate ships.

JULIA TAYLOR KENNEDY: Describe to me how those mother ships work and why that's so much harder to keep track of and defend against.

JAMES STAPLES: What we first saw was that pirates were using dhows and fishing vessels to go out a greater distance, and they would travel with their smaller boats and use these mother ships, as they were called at that time, to venture out and grab larger ships.

What we've seen lately is that they are now using the captured vessels, which can be 600 to 1,000 feet long, as a mother ship. They are now using this as a home platform that they launch their attacks from. That's the great concern right now, not only from a maritime standpoint, for collisions and the environment, but it also gives a platform in which it is very hard to defend against this type of an attack.

JULIA TAYLOR KENNEDY: They're able to travel further this way too, right?

JAMES STAPLES: If they wanted to, they could go worldwide with the capability that they have. They could put the food onboard, they can have the fuel, they have the range. As we see now, they're all the way down to the Seychelles and they're starting to venture up into the Gulf of Oman. Anywhere is a possibility, but they're staying in the Indian Ocean right now.

JULIA TAYLOR KENNEDY: How have national and international policymakers responded to this increasing threat?

JAMES STAPLES: That's a good question, because the problem right now is the detention of these pirates. Right now it's mostly a catch-and-release type program, where once the pirate is caught, they destroy the weapons and the boat, but for the most part, they let the pirate go. They put him back in Somalia or give him to another jurisdiction where the pirate no longer is out there for that day. But he does return. They're finding most of them do return back to the act of piracy.

The international part of it is a big problem. It comes down to the why. You have some lawyers that perceive the law to be one opinion, and other lawyers that perceive it to be another opinion. This is a problem that's going to go on for a long time.

JULIA TAYLOR KENNEDY: That's because international law of the sea is so murky?

JAMES STAPLES: Yes. Even in the United States we're having problems with the definition of piracy, as you can see in the USS Ashland case and the USS Nicholas case. The judge said that it wasn't an act of piracy where the pirates attacked the Ashland yet the judge that was involved in the Nicholas case said it was an absolute act of piracy. So you have two judges with two different opinions for the same action.

JULIA TAYLOR KENNEDY: With this catch-and-release program, which as you're saying is not necessarily effective at diminishing the number of pirates that are operating out of Somalia, what do you think would be a better solution?

JAMES STAPLES: Absolutely to prosecute these pirates. But the problem is that prosecuting the pirates doesn't diminish their wanting to be a pirate. It's very hard to stop these people from doing what they're doing because of the situation they're involved in back in their homeland. So to do something that will make them not want to be out there as a pirate is going to take an international effort.

They're talking about an international tribunal, but it all comes back to budgets, money, who's going to prosecute them, and where are they going to set up an international court. Detention and prosecution is definitely a way to go, but I don't think that's the end resolve.

JULIA TAYLOR KENNEDY: When the Barbary pirates threatened U.S. shipping interests 200 years ago, and even before that, when piracy was a threat in the Caribbean, policymakers took a truly hard-line stance. Basically, they took a "hang 'em high" approach to piracy. Why is that less appropriate in this day and age?

JAMES STAPLES: The pirates in Somalia know it's part of doing business. When the pirates were killed from the Alabama incident, that was just part of doing business. They understand that. Prosecution is not much of a deterrent for them when they live in the situation that they have back in Somalia, where there's nothing there.

Everybody knows that the overall resolve for solving this problem is to stabilize Somalia and to bring back education and an economy that survives there. But until that happens, the deterrence is going to be a very difficult one.

Defense is probably the only way you can do it right now. A short-term solution to keeping the ship safe is to stop the pirate before he gets on the rails, to try to limit what's happened.

As you see right now, just from the Alabama incident, they had roughly 250 captives being held at that time. Almost two years later, there's over 800 hostages being held. Today, as we speak, another ship was taken this morning, and also another sailboat was taken with four Danish adults and three children onboard.

JULIA TAYLOR KENNEDY: We can also think of recent events in which four U.S. hostages were killed. The reports say they were killed by pirates. Do you think that's a possible game changer for global piracy policy, to shift more towards armed security onboard ships?

JAMES STAPLES: That's a good question. Again, we pose this question: If a Somali starts to see his brothers not coming back from sea, will that deter him from doing it?

The belief out there is absolutely not. He still will go out there to try to make that type of money. When you start looking at the profit that's involved—$9.5 million for the last VLCC [Very Large Crude Carrier] that was paid—the money is just going up and up every time. You have to take away the profit margin for them to maybe stop being a pirate. And again, it gets back to stabilizing Somalia.

Defending the vessel is one way to do it. But what we have to look out for is that at every turn they've always been ahead of us one step—they up their game too.

The next thing that we need to be aware of is that the vessels that they're using, they're starting to turn those vessels into a weapon themselves. They may start arming the vessel, as they do with their Toyotas on the beach, the technicals that they run around with, where you see very often a Toyota with a 23-millimeter anti-aircraft weapon in the back of it. What's to prevent them from starting to use that type of tactic? That's the thing you need to look at.

They have the hostages onboard, and now they have the weapons. How do you fight a situation like that when hostages are involved?

JULIA TAYLOR KENNEDY: Do you think if shipping companies hire more armed security to go through the Gulf of Aden, to be onboard, could that cause an escalation?

JAMES STAPLES: Absolutely, it could definitely cause an escalation. But everything that's being done right now is causing an escalation. They're finding out from some of these hostages that return that even by going into what they call the Citadel—after they've been in the Citadel for a little bit of a time, if the pirates get them out, there's an escalation of violence towards the crew for doing that. No matter what you do, there's going to be an escalation of violence from the pirates.

JULIA TAYLOR KENNEDY: The Citadel is part of the shipping companies' boats where the crew can hide out if the ship is being attacked?

JAMES STAPLES: Correct. What they've done is they've basically taken a space onboard the vessel and made it into a type of safe room where the crew can hide for a certain amount of time until the military can get there.

But as we've seen with the Beluga Nomination, which just happened a few weeks back, the crew was in the Citadel for two days and the pirates were able to get into the Citadel. They captured the crew, and on her return home they had already assassinated two of the crew members. So retribution and payback is terrible for these crews.

JULIA TAYLOR KENNEDY: You're working with different shipping companies and organizations, and looking directly at piracy threats. Are you seeing a wide array of ideas for how to manage these threats, or is everyone on the same page? What kind of response are you getting from these companies?

JAMES STAPLES: A lot of the companies, especially the foreign companies, are definitely hands-off with armed security. They definitely do not want to go down that road.

American companies are putting armed security onboard to keep the crew safe. They feel that's the necessary and prudent thing to do right now.

As you've seen, nothing has happened to an American ship since the Alabama. For the most part, most of them have armed crews onboard. It's mostly the foreign ships that we're seeing problems with, where they don't have armed security.

The pirates generally, if they're attacking a vessel and there's an armed security team and fire is returned, they generally turn away and leave the area to find an easier target. That seems to be the case right now.

JULIA TAYLOR KENNEDY: You mentioned that U.S shipping companies are more willing to put armed security onboard. What percentage does that make up of ships that are going through the Gulf of Aden?

JAMES STAPLES: It's a very small percentage. It's probably less than 1 percent. I believe there's less than 100 American ships with the American flag right now. In a world market we're very small.

JULIA TAYLOR KENNEDY: Why is there such resistance among foreign shipping companies to put arms onboard?

JAMES STAPLES: It comes down to a liability issues as to the weapons onboard. If somebody gets hurt, if a Somali is killed, there may be a civil court case, to where they could be paying a lot of money. And it costs a lot of money to put an armed team onboard. It comes down to basically two things: cost and liability.

JULIA TAYLOR KENNEDY: What is the cost of putting armed security onboard?

JAMES STAPLES: A four-man team usually runs about $4,000 a day, and they can be on for as much as ten to 15 days. That's about as low as it gets. That's probably someone that's making bare bones, if they're making any money at all, because of the insurance that's involved. So it's a cost/risk thing.

The owners will always tell you that it's very risky to do it, but the industry itself is a risk industry. Going to sea is very risky. Seamen are well aware that they have the chance of a fire, sinking, collision, or bad weather. But in most of those instances, we've always been able to have the proper training and equipment.

It's the piracy issue where the sailors, especially the foreign sailors, feel like they're being let down by their owners, where they're not getting any kind of support, whether it be an armed security team, or maybe an escort vessel that can escort the ships through the areas that we're talking about.

I'm not talking about the naval escort vessels. I'm talking about maybe a private escort-type vessel that Blackwater had tried at one time.

JULIA TAYLOR KENNEDY: Companies cite the risk of having weapons onboard, but there's lots of other risk. What do you think it really boils down to?

JAMES STAPLES: Everything boils down to cost. Shipping companies during 2008-2009 had major setbacks financially. They lost a lot of money. It was the world economy. The economy was bad. They were losing money. They know that.

In 2010, some of them saw record profits. Maersk had a $5 billion profit last year. These shipment companies are making money again. They're looking at building ships and putting more of them out there.

There's a French company called CMA CGM that is running container ships now that are going to be running through that area. They're now going to carry ten passengers at a little over 6,000 euros apiece.

These are companies that are going to start running their ships through pirated areas with passengers, where they're not taking preemptive measures to keep the crew safe, and they're relying on the military to do all of this. It's just too great a task for the militaries to do when they also have budgetary cuts.

JULIA TAYLOR KENNEDY: How does the military escort work?

JAMES STAPLES: The way the military is, there's a transit corridor that runs through the Gulf of Aden, and the ships transit. They meet at a certain time, there's time intervals that are set up, and they all transit at the same time. The military spreads out their ships in that length of corridor so that they can protect the vessels that are in the corridor transiting with them.

JULIA TAYLOR KENNEDY: It's almost like a police escort that you'd see on the highway but at sea?

JAMES STAPLES: Very similar to that. And they have helicopters onboard the vessels. It has been very effective.

But it's for a small area. What's happened is it's like squeezing a balloon—you squeeze in one area and it just pops out somewhere else. That's what we've seen happen, to where now the pirates are operating basically in the whole Indian Ocean.

JULIA TAYLOR KENNEDY: Then you're saying what shipping companies could do is hire a private contractor to accompany them further along, where they might find pirate threat?

JAMES STAPLES: That's being talked about. But again, it gets down to cost, logistics, and manning. It's a lot of problems. It's not as easy as "We can put a vessel out there and it will follow with you." You have fueling problems with it; you have logistics with that vessel, breakdowns, and things like that.

It's not simple; this is a very complicated problem. A lot of people seem to think that the easy solution is just to put weapons onboard a ship and shoot somebody. But that's not the way it is all the time.

With the legal and logistical issues of this whole piracy problem, the ultimate resolve of this whole thing will be to stabilize Somalia. Until that gets done, this is going to be an almost unstoppable problem.

JULIA TAYLOR KENNEDY: What's your background? How did you become interested in these issues of piracy?

JAMES STAPLES: I'm an academy graduate from Mass Maritime, and I went to sea for 31 years and 17 as captain. Most of my time I transited the Middle East, running military cargo back and forth in Kuwait and Iraq.

I've had incidents myself where we've had pirates running alongside us and have attacked vessels ahead of me and astern of me. On my last trip, in 2009, I actually had an incident where we had a suspicious craft come alongside of my vessel with three males onboard and raised themselves up to try to get onboard at 4 o'clock in the morning. We did have an incident, but I had a weapon onboard that I used. It stopped them from gaining access to the ship, and they left. Then we got the ship started up and we moved.

Traveling in that area and seeing it happen, and being involved in the Middle East with both Desert Storm and the Operation Enduring Freedom and a couple of the other operations out there, I've always kept my eye on the ball when it came to piracy and terrorism out there.

We were in the area when the Limburg was hit, which was a tanker which was hit off of Aden. I was coming through Bab-al-Mandeb when that incident happened.

I've always been out in the hotspots. Absolutely, having Captain Phillips get caught, being a classmate of mine, was a real hair-raiser.

JULIA TAYLOR KENNEDY: I'd like to go back to the experience you described in 2009, when you said you had weapons onboard and you used them. How do you use them? Do you use them to shoot near the pirates? Are you shooting directly at them? How does that kind of intimidation work?

JAMES STAPLES: We had tried everything prior to that—lights, screaming and yelling, water, and all of that. What it came down to was I fired two warning shots in the vicinity of their boat. They absolutely knew what that was. When they heard the weapon go off, they looked up, saw me, and then they started their boat and left.

JULIA TAYLOR KENNEDY: You also mentioned you were a classmate of Captain Phillips, who was taken hostage in the Maersk Alabama incident. How did that event really change knowledge of piracy in the Gulf of Aden?

JAMES STAPLES: It hasn't really changed anything. It did make the world aware for five days that piracy existed. Until that point, nobody had ever really heard about piracy.

I can remember when my kids were back in grammar school, years ago, that I used to go and talk about pirates. I'm talking 15, 20 years ago, when we had the pirates in the Malacca Straits. People just didn't really understand it; they didn't get it. The Johnny Depp image obviously doesn't help.

This is something we've dealt with as mariners my whole career. When Richie Phillips was caught, it just brought awareness, especially to the American public, that piracy existed.

The second time when the Alabama was attacked, another classmate of mine was onboard. I remember doing interviews. I can't tell you how many people called me and mentioned the fact that it was still going on even after what happened with the first incident. They thought that once the Navy Seals took out those three pirates, that it was a done deal and piracy was no longer in existence.

JULIA TAYLOR KENNEDY: Are you seeing as a result of that attention—you expressed frustration with some of the shipping companies' reactions—but are you seeing more movement in addressing this threat?

JAMES STAPLES: Everybody's trying to work towards the final goal, but it's just which direction do you want to go. Most people seem to think that non-lethal action is the best way, and because it comes down to a liability issue—you start shooting people in boats and you're looking at civil action maybe on the other end of it.

If they can work at fixing this problem, they certainly would. Until Somalia is stabilized it's not going to happen. What we have to do to stop piracy is we need to stop it at the ship's rails right now.

That depends on what type of measures the company is willing to take. Most of them want to use the LRADs and laser beams. But non-lethal is exactly what it is, it's non-lethal. When somebody's shooting RPGs and AK-47s at you, LRADs just don't do anything.

JULIA TAYLOR KENNEDY: What is an LRAD?

JAMES STAPLES: An LRAD is a Long-Range Acoustical Device. It's a device that's pointed in the direction of somebody and sends out an acoustical wave that perforates the eardrums. It can become painful. But, like all non-lethal, you can use different things that will diminish its effect.

JULIA TAYLOR KENNEDY: What would you recommend for executives at shipping companies as they're weighing these different ethical dimensions? There's fixing Somalia and its victims of desperation, there's dealing with the crisis at sea, there's considering international law, there's considering the costs and liabilities.

JAMES STAPLES: The first thing they need to consider is how do we keep the crew safe. That should be their first priority: Non-lethal is exactly that, non-lethal.

The second thing they need to consider is can they sustain having their vessel held for maybe six, seven, or eight months. The larger shipping companies probably can—Maersk and a couple other big shipping companies—even though they would never admit that. But if one ship got taken out of the line, they could probably bring another ship in to pick up the slack from it. It would be more of a media nightmare for them than a logistical problem.

Then you get the owner on the other side of the fence, who's just barely making it, to where he can't afford to have his ship taken. You have owners on all sides of the spectrum with all different ideas.

There have been articles written by senior vice presidents from major shipping companies within the United States that say they don't see it as a problem, and they don't see the Somali pirates as winning. "Piracy is not even an irritant" was one of the quotes.

This was from a major shipping company in the United States. When you have senior vice presidents making comments like that, then you have a problem. He's looking at it more from an economic standpoint where one of his ships being caught is not a problem. If he had a cyber problem where all his ships were shut down, he's looking at a major loss of money, he's looking at maybe $5 million for a ship that he has to pay rental for. How they look at it, on a risk assessment, is more from an economic standpoint than logistical.

JULIA TAYLOR KENNEDY: These are really fascinating issues to think about.

Captain James Staples, thanks so much for joining me on Just Business.

JAMES STAPLES: My pleasure. Thank you for having me.