CRIME:
McMafia: Crime Without Frontiers,
By Misha Glenny, The Bodley Head, 426pp. £20
Gangs throughout the world are interacting in a nexus of
crime, politics and money, labelled the McMafia, writes
Conor O'Clery.
LATE ONE evening in 1988, as I walked along a deserted Moscow street with some friends, a car with two men inside drove away at speed from outside a tyre repair shop located in an old, two-storey building. As it disappeared round a corner, we saw flames leaping from a smashed downstairs window. We telephoned the fire brigade, but by the time it arrived the building was engulfed.
This was my introduction to a new generation of criminals in Moscow, the Russian mafia. Earlier that year, the reforming Soviet leader, Mikhail Gorbachev, had allowed, for the first time, the establishment of small privately-run businesses known as co-operatives, that could compete with state-owned enterprises. Some of the earliest co-operatives were founded in the region of Moscow where I was working as a correspondent, among them the tyre repair business in Great Communist Street. Moscow crooks, such as the men who torched the co-operative, saw an opportunity to extort "protection" money from these first capitalists in the disintegrating Soviet Union. Those who resisted were burned out or killed as an example to others.
The emergence of the Russian mafia has been well documented in such books as Comrade Criminal, by Steve Handelman. What Misha Glenny, a former Guardian and BBC correspondent, has done is to put the Russian mafia and other criminal phenomena of the post-communist world into a global context.
An award-winning correspondent and the author of acclaimed books on Eastern Europe and the Balkans, Glenny travelled across five continents over three years, interviewing gangsters, politicians, police and victims, to investigate the extent and scope of the new criminal networks. He reached some startling conclusions, among them that the shadow economy has grown so vast it may now account for 20 per cent of the world's GDP.
Many of the new global criminal enterprises are named after the Sicilian mafia: the title "McMafia" implies a McDonald's-like proliferation of the franchise around the world. The word mafia itself has entered the language of Russia and other countries. The new mafias are however different from the Italian model. They emerged from a chaotic situation and are not bound by family loyalties but by transactions, which means they are unpredictable, fluid and dangerous. They at first fought over the spoils of privatisation, then seized whole industries and governmental institutions, and sucked countless citizens into a vortex of violence.
Often they were assisted by ideologically-driven western advisers. The price liberalisation in Russia in 1992, carried out on the urgings of American economists who swarmed into Moscow, contained some catastrophic anomalies. The reformers continued to hold down the prices of Russia's vast natural resources, oil, gas, diamonds and metals, which were often as much as 40 times cheaper than world markets. At the same time, the government privatised the state import and export monopoly. This gave birth to a new species of robber baron, the Russian oligarchs, who enriched themselves in what the author calls "the grandest larceny in history".
The collapse of communism led to the emergence not just of new criminal networks but of transitional and failing states that were themselves criminal enterprises. Ukraine after independence from Russia was run by a criminal political mafia, a claim made by no less an authority than the country's top investigator of organised crime and corruption, Hryhory Omelchenko, who alleged in parliament that the country's chief capo was none other than president Leonid Kuchma, who for 10 years presided over the "total criminalisation" of the Ukrainian government and civil service.
Kuchma was secretly taped threatening to get rid of a troublesome investigative journalist, Georgi Gongadze, whose headless body was later discovered buried at the edge of a wood. Widespread public outrage culminated in the Orange Revolution of 2004, which swept pro-western leaders into power. (Recently three former Ukrainian policemen were sentenced for killing Gongadze, but the people who ordered the killing remain at large).
Ukraine's syndicates developed a reputation for trading women and migrant labour. In Bulgaria it was cars. In the former Yugoslavia it was arms and cigarettes. In the sliver of central European territory known as Moldovan Transnistria, which Glenny terms "the quintessential gangster state", modern weapons from the Soviet-era stockpile spewed out into world markets, including, he estimates, 74 Russian surface-to-air missiles capable of bringing down a 747.
Such interaction between politics and criminal activity is a constant theme. In Afghanistan the intervention of western powers against the Taliban caused the country to become an epicentre of organised crime, insurgency and terrorism, with opium contributing a staggering 57 per cent of GDP according to United Nations figures. In the Balkans in the 1990s a UN vote for sanctions created almost overnight a pan-Balkan mafia of immense power, reach, creativity and venality.
Gangs of Russians, Bulgarians, Nigerians, Colombians, Chinese, Afghans and Canadians today interact in a nexus of crime, politics and money. But Canadians? It comes as something of a surprise to learn that western Canada is home to the largest per capita concentration of organised criminal syndicates in the world. In British Columbia an estimated 100,000 workers, full-time and part-time, are engaged in the cultivation, smuggling and retailing of marijuana. Glenny went to see for himself, and was taken deep into the forest to see how former loggers grew marijuana in sunken sea containers, which was harvested and smuggled into the United States. The number of "regular" people involved in this lucrative racket soared when, in violation of its free-trade responsibilities, the United States gave in to pressure from the American lumber industry and imposed a heavy tax on Canadian timber imports, causing severe job losses north of the border.
One of the most interesting chapters in the book deals with the Nigerian kleptocracy, with which we are all familiar. Anyone who owns a computer will have received a mailing from a Nigerian "banker" or "lawyer" seeking to use a bank account to deposit huge and mythical sums of money, for a relatively small transaction fee. This is a truly globalised cyber-scam. The Advanced Fee Fraud (or 419 as it is known from the Nigerian criminal code) started with the fax machine, but the proliferation of the internet transformed it into one of the most "exuberant and mischievous" examples of crime in history. Citizens in 38 developed countries admitted to losses of more than $3 billion in 2005 alone. Glenny examines the psychology of the scammers, whose social acceptance in Nigeria is reflected in the popularity of the anthem I Go Chop Your Dollar, the first line of which declares, "419 be no thief, it's just a game". One prominent Nigerian tells him: "If Europeans get ripped off, they deserve it. They are greedy and trying to make money out of African people".
The great merit of Glenny's book is that it does not just chronicle the foul deeds of international crime syndicates. It probes into the imbalances and injustices that propel people and nations towards criminal behaviour. In particular he singles out the colonial legacy and the curse of oil. He also finds some heroes, such as Nuhu Ribadu, director of the Nigerian Economic and Financial Crimes Commission, which in just three years of existence has recovered more than $1 billion in stolen assets and put away some senior administration officials.
Having surveyed international crime in such an original and comprehensive way, Glenny reaches some compelling conclusions. He makes a powerful argument for the legalisation of drugs, which constitute 70 per cent of organised crime activity. With narcotics, where demand is immense and relentless, prohibition drives the market towards the only place capable of satisfying that demand and regulating the industry: organised crime. If a country supports prohibition, it is guaranteeing that on the supply side all profits will accrue to underground networks. After almost four decades of the war on drugs in the United States, dependency levels and usage are higher than ever before, and the state has wasted hundreds of billions of dollars in a criminal justice system that "delivers a lot of crime but very little justice".
Much of the blame for drug-smuggling, gun-running, money-laundering, cyber crime, human trafficking and the wholesale manufacture of fake goods ultimately lies with the appetite of westerners for drugs, cheap labour, prostitutes, fashion accessories, plastic goods and gadgets. We are all complicit in one way or another, even if not individually a consumer of class A drugs. This, racy, well-researched and highly entertaining book should be essential reading for law reformers everywhere.
Conor O'Clery is a former Moscow Correspondent of The Irish Times