International Journal on Criminology Volume 7, Number 1, Winter 2019/2020 | Page 91

International Journal on Criminology
Barcelona in 2010 linked to the Sinaloa Cartel or the arrests in Spain of top Mexican
operatives, notably El Chapo’s cousin, confirmed the worst fears of Italian
Mafias regarding the implementation of this ferocious competitor in their markets
(Lopez 2013).
4.1.3. The Indelible Footprint of Mafias in the Finance World
Mafias’ perpetual attempt to increase its tremendous wealth by reinvesting illicit
revenues in the legal and illegal economic and financial systems, legitimately raise
questions over its ability to influence positively or negatively its course. In other
words, have Mafias successfully developed a new deadly political weapon, and a
tremendous source of revenue, by investing critical parts of its estimated $500 billion
annual revenues in financial markets (UNODC 2011)?
Mafias’ increasing interest in the finance sector emerged in the 1970s. Increasingly
loose fiscal legislations encompassed one of Mafias’ key strategic objectives,
i.e. “the creation of venues for the private accumulation of capital, without
the loss of any of that capital to public governmental purposes through redistributive
taxation, social welfare or the provision of public goods” (Cockayne 2016,
262). Moreover, as Holton highlights, global multiplication of stock markets, complexification
of financial operations, and rapidity of information sharing match
Mafias’ desire to stay invisible while conducting their illegal activities (Holton
2012). Hence, Mafias have considerably extended their activities thanks to the development
of wild capitalism, offshore shell companies, tax evasion schemes, and
tax havens.
Thriving Mafias’ presence in the finance world was brought into the open
during successive financial crises. Several studies, notably from Yakuza expert
Philippe Pons, indicate indeed that 30–40% of toxic assets during the 1990s Japanese
stock exchange crisis belonged to the Yakuzas (Pons 1992). These “Mafia assets”
were, by definition, unrecoverable loans (McCarthy 1993). Mafias uprising in
the financial world, Naim argue has been boosted by the 2008 crisis, as they easily
recruited brilliant unemployed bankers, accountants, or computer scientists and
became major players of the international finance system (Naim 2012).
In December 2009, Antonio Maria Costa, then UNODC Director, declared
that earnings of Mafias made up the sole liquid assets at the disposal of some banks
seeking to avoid collapse during the 2008 financial crisis (Gayraud 2014). According
to the IMF, between 2007 and 2009, banks in the United States and Europe
lost more than $1 trillion in toxic assets and bad loans, and by the second half
of 2008, shortage of liquid assets (cash flow) had become a major problem for
the banking system. In many instances, Mafias’ enormous assets were the only
available liquid investment capital further encouraging banks to open their doors
to criminal organizations. This was demonstrated by two Colombian economists,
Alejandro Gaviria and Daniel Mejía, as they revealed that 97.4% of South America
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