The price of looking the other way by state officials has a new measurement: the Rhino Horn Index. Like a Hollywood list for actors and directors, those in the know can scroll down and find out the asking price and from their contacts establish the actual price. But establishing market price of officials is getting ahead of ourselves. Let’s first examine the transition of organized crime. Organized crime adapted to the industrial age, and it is now adapting to the digital age.
We draw our knowledge about criminals and their activities from TV shows like the Sopranos, the newspapers, films like the Godfather and Good Fellas, novels, and plays. The Mafia is a cultural object that people feel they know.
The Mafia has a code. And they have their iconic philosophy such as “Money is Power.” Or “It is a good person that sees and keeps silent.”
The Mafia was associated with families and operated locally.
Like any other business model, the modern criminal organizations wishing to scale to global reach have had to modernize to keep with the times. Tony Sopranos’s world is already in the past.
Leaving aside murder, kidnapping, rape, assault, burglary, and robbery that involve an individual or maybe a few individuals in a gang, the big-money crimes are in stolen art objects, animal products, security swindles, counterfeit goods, credit card fraud, tax and benefit scams, and, of course, trafficking of people, weapons, drugs, and illegal wildlife. The criminal kingpins like their counterparts in finance, banking, big corporations have reduced their risks by finding flaws in the existing law enforcement system and exploiting them to their benefit.
The name of the game is not to get caught.
The digital highway robbers are surfing the big data wave. With the best lawyers, accountants, and consultants, they can find new and better opportunities for making money and figure out the probability of detection.
With large cash washing through their hands, the criminals succeed by creating networks of police, politicians, customs and immigration, bankers, lawyers, CPAs, who are rewarded for their assistance. The international crime payroll is likely one of the biggest in the world. The CEOs of these hugely profitable enterprises do not appear on the Forbes list of the richest. They are hidden out of sight.
The global criminals are drawn from many nationalities. The list would include: Russian, Chinese, American, Indian, English, Macau, Madagascar, Brazilian, and many more. The old idea that crime is ‘organized’ never contemplated the full extent that the modern digital economy could improve organization.
The Economist, January 18th 2014, ran a story “Earning with fishes” that indicated the illegal wildlife trade was worth ‘as much as $133 billion annually.’ That’s a lot of exotic birds, elephant tusks and rhino horns. As rhino horns fetch up to $50,000 per kilo you have a product significantly more profitable than cocaine or gold and if you get busted, the sentence is closer to 14 months than 40 years in the big house. The question in the mind of an international criminal is how many rhino horns in pay offs are required to complete the transaction?
A lot has been written about money politics and how the rich use lobbyist to influence Congress to pass legislation to protect and advance their economic interest.
In the criminal world, they cut straight to the chase and pay off the prosecutors, witnesses, customs inspectors, the cops, and anyone else hovering near the criminal justice system. One kilo of rhino horns buys a cop or a district attorney. Four kilos and you have a judge finding insufficient evidence. A small herd of rhinos should be enough to buy an entire congress.
The biggest source of corruption isn’t the politicians filing phony expense accounts, or giving a contract to a relative or friend, or taking a golf holiday paid for by a big pharma company. The real action is in the world of illegal transactions where the players know the price of those monitoring and regulating the law enforcement system. They use money to control that system.
And they do it every day of the week to the tune of billions of dollars.
Organized crime has discovered what the DOW 500 CEOs have figured out: borders are your best friend—just like cross-borders is the new mantra for international crime. Divide your business into component parts: Your buyers are in country A, your sellers are in country B, your money comes from country C, your mules from country D, your transportation from country E, and your residence is in country F. Payments flow across multiple borders, from multiple bank accounts, in multiple names.
Each jurisdiction has its own laws and regulations and officials to take care of. Choosing the right location for a part of the overall transaction slows down the official process as the officials only see the part that takes place inside their borders. It’s pulling all of the pieces of the puzzle apart. The criminal caught is the mule, the flunky, the ‘worker’. The crime bosses are at sitting beside their swimming pool drinking a cool drink. Their connection to the criminal activity has disappeared as the trail ends in an offshore company with nominee shareholders and directors.
What is the reaction of governments to the scaling of international criminal activity? The Economist says without any irony: “Governments are reacting by getting law-enforcement agencies to work together. America is trying to improve the flow of information between them.”
What this means is the government has no plan. It is too busy fighting terrorists, and that fight sucks all of the resources into a battle that lets the criminal class clean up. International criminal activity is layered with complexity. Take money laundering as the cash rattling around the system won’t fit in a suitcase. It needs a banker.
“Between 2006 and 2010, some of those criminal networks laundered $881 millions dollars through a single legal bank inside the United States. In fact, in 2012, the Criminal Division of the Department of Justice pointed out that the same Bank ‘failed to monitor’ $9.4 billion dollars during that same period.”
This amount comes from gangs in Central America and Mexico. Wrap your head around the amounts from all criminal activity internationally, and you start to understand the dimension of the problem. This year on The Edge, the question asked is: What scientific idea is ready for retirement? And Eduardo Salcedo-Albaranchose recommended that “Crime is only about the actions of individuals” should be retired.
In its place we turn to data mining tools to make predictions from the vast sea of information to get a handle on how the networks are constructed. Once the design emerges, the players’ roles understood, the parts of the puzzle are reassembled. The idea is to use big data to establish an overall picture of the full extent of the components (including the gray areas of officials, politicians, banks, lawyers, and accountants) who play a role in the criminal organization. The process goal is to make the illegible legible.
This assumes that major criminal organizations are keeping one step ahead with their workforce of specialists who can encrypt communications and set up alternative means of funneling money. Given the huge resources available to international criminal syndicates, the chances are finding a person’s price in kilos of rhino horns will extend the immunity they currently enjoy. There are companies that provide seminars on how security teams can use web intelligence for effective threat intelligence analysis.
The reality is government is either too distracted, has different priorities, or enjoying the fruits of kilos of rhino horns to make significant headway into the tangled web of organized international crime. The best and the brightest minds might find an alternative to working on Wall Street. And the rest of us might wake up to discover there is another .1% working the system, who are untouchable and too big to fail.