Monday

25th Jan 2021

Financial crisis is boom time for mafia

  • Grasso: 'They've got liquid cash, they've got ready money ... and not just in Europe' (Photo: Wikipedia)

Struggling banks in the EU and beyond are becoming more willing to launder dirty cash for organised crime.

Italy's anti-mafia prosecutor Pietro Grasso drew attention to one of the lesser known aspects of the crisis at a hearing in the European Parliament's new anti-mafia committee on Tuesday (19 June).

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He told press: "The current economic crisis is making criminal groups even more powerful because they've got liquid cash, they've got ready money ... and not just in Europe, but in other countries where there are fragile economies and they can influence politicians."

His line was echoed by Jean-Francois Gayraud, the chief superintendent of the French police.

"What we've seen in Europe is widespread criminalisation of financial structures in the internal market," Gayraud said.

The phenomenon poses an "existential question" for some countries where it has "transformed" both national politics and financial markets, he added.

The observations are not entirely new.

Antonio Maria Costa, the former director of the UN's anti-organised-crime bureau, the Vienna-based UNODC, wrote in his blog in April last year: "Money from drug traffickers injected into the financial system has saved the banks from the financial crisis."

The Paris-based criminologist, Michel Koutouzis, who carries out investigations for the UN and for EU institutions, noted in May in his new book - Crime, Trafficking and Networks - that organised crime is increasingly investing in sovereign bonds.

The EU parliament committee is planning to flesh out ideas for a new European Commission "action plan" for EU-level counter-measures.

But for Koutouzis the creation of the committee is itself part of the problem.

"The authorities' preferred approach is to observe, to study, to create committees and new institutions. They already know what's happening. But no one wants to take action," he told EUobserver.

He gave as an example his own work for the UN on counterfeit medicines.

"I went to dozens of meetings in Vienna and in Geneva where officials said: 'It's so complicated. We don't know who's responsible' ... But one day after getting off the plane in India, I was standing inside a counterfeit medicine factory with a hidden camera."

Meanwhile, the EU institutions themselves are not immune to corruption.

Belgian police in 2007 arrested two Italian nationals - a European Commission official and an EU parliament assistant - on suspicion of taking bribes from an Italian businessman in return for contracts for EU projects in Albania and India

Giovanni Kessler, the head of the EU's anti-fraud office, Olaf, on Tuesday noted that organised crime accounts for about 40 percent of the "financial damage" wreaked upon the EU budget.

"This trend is increasing," he said.

Investigation

How the Italian mafia found a Dutch home

One of the biggest mafia trials in Europe in recent years is about to end. Members of the Crupi clan are accused of smuggling vast amounts of cocaine from South America to Italy, using the Netherlands as their main hub.

MEPs chide Portugal and Council in EU prosecutor dispute

The Belgian and Bulgarian prosecutors who were appointed had also not been the experts' first choice. Belgian prosecutor Jean-Michel Verelst has challenged the council's decision at the European Court of Justice.

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