By
JIM YARDLEYAPRIL 24, 2014
ROME
— The small businesses were sprinkled throughout the Italian capital: One
restaurant was only a few blocks from the Senate. A cafe was at the edge of the
upscale diplomatic district, while a gelato shop was near the Pantheon. There
was even a hotel not far from the hilltop statue of Giuseppe Garibaldi, the
hero of Italy’s unification.
In
a city where government and tourism are engines of the local economy, these
storefront businesses seemed typical until a police crackdown exposed them as
money-laundering fronts for mob organizations based in southern Italy. During
January and February alone, Italian officials seized 51 million euros, or about
$70 million, in mob properties and other assets in Rome, providing a small
glimpse of the legal business interests that southern clans control in the
capital.
The
crackdown in Rome exposed just a small corner of what officials describe as a
mob economy that has rapidly expanded across Europe. In an era of austerity,
with Italy awash in debt and struggling to recover, organized crime groups are
sitting on mountains of cash. They have taken advantage of the economic crisis
to accelerate their infiltration of legitimate businesses outside their
southern Italian strongholds and now control commercial interests in Rome and
Milan, as well as in France, Germany, the Netherlands, Scotland, Spain and
beyond.
“For the last 20 years, they have a lot of
liquidity,” said Michele Prestipino, the prosecutor who oversaw the recent
crackdown and seizures in Rome. “This is a problem today. They have too much
money. They can’t invest it all. It is the opposite of what happens to regular
entrepreneurs.”
If
Europe once thought of organized crime families as largely an Italian problem —
and if many Italians thought the problem was mostly confined to the south — the
breadth of their assets across the Continent is forcing a reappraisal. In
February, the European Parliament passed a new directive making it easier for
national authorities to confiscate criminal assets, in response to evidence
that organized crime groups have gobbled up properties and companies across
Europe.
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Experts
say Europe must introduce tough organized crime laws, like those that already
exist in Italy, and expand law enforcement efforts. Some say the same focus
that is applied to fighting terrorism should be applied to confronting
organized crime. Besides Italian mob groups, experts say, other criminal
organizations, including ones from Albania, China and Russia, are also moving
into legal business sectors in Europe.
“Democracies
underestimate the fight against the Mafia,” said Giuseppe Lumia, a senator and
member of Italy’s Anti-Mafia Commission. “Mafias have become global. They do
business, and do money laundering, between countries. But the anti-Mafia agencies
are national and local.”
Determining
how much cash Italy’s mob organizations turn over in a single year from illegal
activities is extremely difficult, with estimates varying widely, from about
€10 billion, or about $14 billion, to as high as €220 billion, or about $304
billion. One of Italy’s largest business associations, Confesercenti, has
estimated that organized crime accounts for roughly €130 billion, or about $180
billion, in annual turnover — about 7 percent of Italy’s gross domestic
product. Confesercenti also estimated that the organized crime groups had
roughly €65 billion, or about $90 billion, in cash reserves.
“They have amounts of money that are
incredible,” said David Ellero, a specialist in Italian organized crime at
Europol, the European law enforcement agency. “In some investigations, the
flows of cash were so conspicuous that rather than counting it, it was being
weighed on scales.”
The
richest organized crime family is believed to be the ’Ndrangheta, (pronounced
n-DRANG-gay-tah) a group from the Calabria region that now controls much of
Europe’s cocaine trade. Analysts say the ’Ndrangheta is active in Britain,
France, Germany, Spain and Switzerland. The other two main organizations are
the Camorra, the clans based in the Naples area, which are especially powerful
in southern Spain; and the Cosa Nostra, the Sicilian mob families depicted in
“The Godfather,” which are active across Europe.
In
their home regions, Italy’s organized crime groups often operate as shadow
states, infiltrating local politics while controlling territory through
intimidation and violence. Analysts say this local dominance explains why the
organizations are heavily involved in sectors such as construction, mining,
waste management and transportation, where their political influence allows
them to steer government contracts to their favored firms.
In
northern Italy and in other European countries, mob groups operate far less
conspicuously, analysts say, especially since they lack the same level of
political or territorial influence. But a report presented recently to European
Union officials concluded that mob tentacles were nearly everywhere: hotels,
nightclubs, real estate, gambling, construction, retail gasoline sales,
wholesaling of clothing and jewelry, food processing, health care, renewable
energy and more.
“They
have specific preferences for certain sectors,” said Michele Riccardi, a
researcher at Transcrime, the research institute in Milan that compiled the
report presented to the European Union. “These are the sectors that seem more
vulnerable and the regulations are looser.”
Italy
has Europe’s toughest anti-mob statutes, which is one reason many organized
crime families have pushed into other European countries. Germany has become an
especially prominent case.
Gendarmes
during a court appearance by Antonio Lo Russo, suspected of being a mob leader,
in Aix-en-Provence, France. Credit Boris Horvat/Agence France-Presse — Getty
Images
Italian
migrants began pouring into Germany in the 1950s, including many from Calabria,
home of the ’Ndrangheta. When the Berlin Wall fell in 1989, analysts say
wiretaps detected a mob boss in Italy ordering a lieutenant to get into East
Germany immediately and “buy everything.”
This
month, the German newsmagazine Der Spiegel wrote about a trial in Cologne in
which investigators have accused mobsters linked to the Cosa Nostra of bilking
the state of millions of euros by issuing fake invoices from shell construction
companies. German officials say the presence of organized crime poses a threat
to the country’s building sector.
The
magazine cited a confidential overview by the Federal Criminal Police Office
that criticized the German government for failing to detect the assets of
organized crime groups. The overview found that Italian crime groups had earned
about €123 million, roughly $170 million, in Germany during the past decade,
yet prosecutors had confiscated just €8 million, or about $11 million, from
them.
The
police report found that while the Cosa Nostra had infiltrated the construction
sector, the Camorra was peddling counterfeit consumer goods and the ’Ndrangheta
was selling adulterated olive oil and other foodstuffs. Mobsters controlled at
least 300 pizzerias in Germany, it said, and were using these businesses to
enter the legitimate economy.
While
Germany and other European Union countries once denied the existence of a
problem, awareness has begun to rise. In February, the Italian and German
authorities carried out a joint operation against the Cosa Nostra and arrested
more than a dozen suspects in both countries who are accused of stealing
millions of euros in European Union farm subsidies. This month, the Italian and
French police collaborated in the arrest of a Camorra boss in Nice, France.
Two
years ago, the European Union set up an anti-Mafia commission, while Europol
recognized in 2011 that it had an “intelligence gap” about mob activities. It
commissioned a broad survey, released last year, which noted that mob groups
were particularly threatening in legal business sectors because they “can
afford to operate ‘at a loss,’ creating in the long run a situation of
quasi-monopoly that undermines the basic principles of free market.”
Even
within Italy, however, many people continue to regard organized crime as a
southern problem. When the writer Roberto Saviano, known for his work exposing
the activities of organized crime groups, used a 2010 television program to
speak out about mob infiltration in the north, the Milan-based newspaper Il
Giornale responded with an online petition drive against him titled, “Dear
Saviano, the North is not Mafioso.”
“Criminal
organizations are all in Rome and up north,” Mr. Saviano said in a recent
interview. “In the south, their presence is like a military presence. In Rome
and the north, it is economic presence.”
Mob
groups have long been a quiet presence in Rome, with shopkeepers complaining of
having to pay extortion money, known as pizzo, but the recent crackdown showed
how organized crime groups are now directly investing in city businesses. Among
the 23 restaurants and pizzerias seized in January was Pizza Ciro, part of one
of the most popular pizza chains in the city.
“It
has nothing to do with cash being in the register at the end of the day,” said
Enrico Fontana, director of Libera, an umbrella group of anti-mob associations
around Italy. “It is for money laundering.”
Mr.
Prestipino, the prosecutor, agreed that money laundering was important but
added that the crime bosses are also looking for ways to create channels of
access to political leaders. He said no politician can meet directly with a mob
boss, but by investing in businesses, organized crime groups can cultivate a
network of white-collar entrepreneurs in Rome who can deal openly with
politicians and civil servants.
“It
is a system that has all advantages,” Mr. Prestipino said. “The businessman
gets the economic advantages. The Mafioso doesn’t have to come to Rome. And the
politician doesn’t have to get his hands dirty.