The Credit Crunch, Organized Crime and Terrorism
By Douglas Farah
One of the most interesting side effects of the current credit and banking crisis, as noted in this weekend piece in the Washington Post is the growing influence of those who do have money to lend-organized criminal groups that have billions of dollars they need to keep moving through the money laundering cycles.
There is strong anecdotal evidence that cartels from South America to Southeast Asia and Europe (and likely the United States, but I have not seen anything to reflect that) are stepping in to credit breach, building relations with businessmen desperate to stay in business, who would not normally look to the "informal" economy for a loan.
This will serve to extend the tentacles of these groups even further into the legal society and financial structure. As the article notes, "Stronger organized crime means a weaker state."
The state is already hard pressed to confront organized crime, and the reasons are not hard to find. One side has resources, the other does not.
The story says a new report estimated that organized crime syndicates in Italy - including Naples's Camorra, Sicily's Cosa Nostra, Calabria's 'Ndrangheta - collect about 250 million euros, or $315 million, from retailers every day. That is about a billion dollars every three days, or about $122 billion a year siphoned out of a single economy. Is it any wonder Italy is a constant economic wreck? My full blog is here.