Mafia cashes in on Italian downturn
By Guy Dinmore and Giulia Segreti in Rome
Italy’s Mafia gangs are profiting from the credit crunch by expanding lending to small businesses and using their vast pools of cash to buy up property and companies at knockdown prices.
A report by Confesercenti, an association of shopkeepers which operates a Mafia research group, estimates that 180,000 small enterprises have turned to loan sharks, partly because the credit crunch has affected bank lending.
“The economic crisis makes the Mafia even more dangerous,” said Marco -Venturi, chairman of the association, presenting his “Crime’s Hold on Business” report.
Usury is the fastest-growing business for the Mafia, which has long consolidated its hold over local businesses and politicians, especially in the south, by providing “security” of cash flow and jobs – at a price.
The Mafia – in reality diverse criminal groups with different structures, histories and tendencies – is -estimated to have a turnover of €130bn ($163bn, £109bn), with “commercial” activities accounting for €92bn, or 6 per cent of Italy’s gross domestic product.
Confesercenti estimates usury accounts for €15bn of Mafia income. Narcotics are by far the most profitable activity, traded across Europe and worth €59bn.
The report underscored recent warnings by anti-Mafia prosecutors that criminal gangs were expanding their activities into trade, tourism, the betting industry, restaurants, construction, rubbish disposal and the property and health -sectors.
Prosecutors recently told the Financial Times that Europe was seriously underestimating the geographic reach of the Mafia, which extended to Russian oil trading and banks.
The centre-right government of Silvio Berlusconi has deployed the army in the Naples region to back up police. Critics say its presence is aimed more at winning over public opinion and will end up being directed against illegal immigration.
Roberto Maroni, interior minister, was in Sicily this week to underline the government’s resolve to tackle organised crime by handing over confiscated Mafia assets, including villas and farms, to local authorities and co-operatives.
Confesercenti estimated that about 150,000 shopkeepers pay the pizzo, or protection money, to Mafia gangs, amounting to €6bn a year. A stall in a food market in Naples has to pay €5-€10 a day, while a Palermo construction site must hand over €10,000 a month.
It said “Mafia Inc” paid €1.76bn in salaries, with the head of a clan earning up to €40,000 a month, while an underage drug dealer, at the bottom of the pyramid, is paid about €1,000.
“The Mafia will take advantage of the weaknesses and the uncertainties of the economy to reinforce its positions. It is necessary to react with determination,” Mr Venturi said.