She dropped a coin into the cup of a blind man at the gate
And forgot about a simple twist of fate.
The Mafia Gains Ground
Italian organized crime is profiting from hard times, using cash and violence to defy Berlusconi’s government and dig deeper into the economy.
By Steve Scherer and Vernon Silver
Bloomberg Markets, July 2009
In the southern Italian port city of Palermo, home to bustling outdoor markets and Arab-influenced architecture, prosecutor Roberto Scarpinato has hunted Mafia money for two decades.
Now, as the rest of the world tightens its belt in the global recession, he’s tracking how the mob is profiting by lending and investing what’s become a scarce commodity these days: a growing hoard of cash.
Scarpinato points to the 2.7 billion euros ($3.8 billion) of assets he’s seized on the island of Sicily, where Palermo is located, since the start of 2008. In one haul, he confiscated 12 businesses, 220 buildings, 33 plots of land and a 25-meter (82- foot) yacht from grocery-chain owner Giuseppe Grigoli…
Unlike overleveraged companies burned in the credit crisis, the Mafia and its cash-based, debt-free business model are breezing through economic hard times. With young, savvy leaders at the helm, organized crime is poised to expand as legitimate companies founder.
“There’s a risk that Mafia organizations can profit from the current crisis by buying control of struggling businesses, infiltrating all regions of the country,” Italian President Giorgio Napolitano cautioned in May…
“There’s a credit crisis that’s putting many businesses in a difficult position,” says Scarpinato, 57, whose dark suit sets him apart from his jeans-wearing bodyguards who tote pistols under their black-and-blue windbreakers. “The banks have tightened the purse strings, and many companies risk going bankrupt. Then there’s the Mafia world, which has vast amounts of cash.”…
“The Mafia is ramping up its investing,” says Antonino Di Matteo, a fellow Mafia prosecutor whose bodyguard stands watch outside his office door in the Sicilian capital’s fascist-era courthouse. “The Mafia’s financial managers are trying to invest now, while the time is right, so that they can launder their fortunes once and for all.”
Italy’s cash-depleted banks may be helping the Mafia become even stronger, says Antonio Maria Costa, executive director of the United Nations’ Vienna-based Office on Drugs and Crime…
…High-interest lending to consumers and businesses posted the biggest gains among illicit commercial activities in Italy last year. Such loan-sharking jumped 17 percent to 35 billion euros, according to SOS Impresa, a Rome-based business group that fights extortion.
People shut out from legitimate lenders paid as much as 730 percent annual interest, outstripping the high of 440 percent SOS Impresa documented in 2007, according to evidence from criminal cases compiled by the organization….
Scarpinato says this new evidence shows that Italy’s crime syndicates pose a growing threat to the global economy, particularly in its weakened state. He says he worries that once the recession ends, the Mafia will have sunk its hooks into scores of new markets and businesses, magnifying its financial clout.
“The Mafia isn’t part of the past, it’s part of the future,” the prosecutor says. “Organized crime has evolved. It has become the criminal protagonist of the third millennium.”
Full article here.
