1.Organized crime - definition, differences between mafia, gang and organized crime, criminal acts.
Mafia and organized Crime
1.diversity between mafia and organized crime
Usually because of mafia's transplantation on the US soil
Mafia - termin z Nuovo Vocabolario Siciliano-Italiano oznacza a prancing behaviour (pyszałkowatość), arrogance, impertinence.
a.Analiza terminu - ma-afir - nazwa plemienia arabskiego mieszkającego w rejonie Trapani.
b.muafah - defense, security, prudence.
c.marfa - hiding-place, mystery.
d.Massacre of French soldiers on Sicilly - morte alla Francia, Italia anela. (Death to France, breath Italy)
e.niekiedy łączy sie to słowo z Garibaldim, który wylądowawszy na Sycylii w 1860 ze swymi żołnierzami miał powiedzieć - Mazzini autoriza furti, incendi ed avvelamenti. (Mazzini aloows to robe, to set fire and to poison).
f.wiek XIII - tajne stowarzyszenie dla ochrony Sycylijczyków przed obcymi wojskami. A więc swoiste oddziały ochrony. Wniosek stąd: w miarę osłabiania struktur państwowych mafia rosła w siłę jako element zastępczy wobec państwa, którego nienawidzono i którego struktury procedury negowano jako organizacji kompletnie niewydolnej.
Funkcje:
a.ochrona
b.pośrednicwto - intervention In the citizen-a state relationship
Szybko też mafia przekształciła się w różne grupy pod przywództwem mafiosów kierujących w danym regionie.
Relacja na zlecenie - mafioso e bandita (wykonawca wyroku). Bandita was authorised to commit a crime.
Bandita - the realization of: extortion, corruption, robbery of a cattle
Mafioso - połączenie trezch funckji w społeczności - protection, intervention, repression.
Mafioso - ten kto był w stanie wymusić to force witnesses to keep silence, and to force the Court to be fund not guilty. He was then estimated by the local community.
Mafia structures can think and work in a “cosca” (family) categories, patronage relations and the client system with the strict control of the region they worked on.
Mafia - is a typical way of behaviour.
La Mafia vecchia si a trasformata a la mafia nova, into a structure chich might be very dangeruous for a state.
The 50's mafia became the international drug cartel which of course seems to be very far from the ethos of the protecting organization.
Struktura mafii:
Three families - district
Disctrict is related to - province (usually the same as the territorial administrative division)
La cosca, district and the province is dependent to repressentante who may have a deputy (sottocapo) and advisors (consiglieri)
La provincial (the province) is usually dependent to the region (representatives of all the regions) is composed of the people of honour (la gente d'honore)
2.A state and organized crime - a legal system
a.in the modern world
-1950's - mafia was transformed from the typical family organization into an international drug cartel employing many people from abroad. Before it was a local organization.
-organized crime in the USA was based on Italians mafiosos who came to the new motherland and local groups known as gangs but with Italian members.
-często mówi się, że amerykańska zorganizowana przestępczość to gengsterzy z Chicago
-J.Edgar Hoover (FBI) wydał wojnę gangsterom, choć sam miał z nimi powiązania (homoseksualizm) blackmailed.Hoover zniszczył Ala Capone
-American law that was applied to Capone: so called Sullivan precedence everyone who earns money, and especially that one whose style of living and expenses show his extraordinary sources of income is obliged to pay taxes.
-drawing conclusions from Capone's trial many bosses signed agreement setting up a monopolistic cartel on the territory of the whole USA including Bahamas and some regions in Canada.
-two terms - La Cosa Nostra and amico nostro (our friend) became synonyms of the organized style of living, but on the other hand it distinguished them from other crime groups.
-in the USA it is assumed that: organized crime is some kind of society trying to operate beyond governmental and national control. It is not only traditional mafia but thousands of other people operating within some structures of complex activity.
-organized crime deliver what do people expect: therefore some sort of demand and supply scheme works.
-organized crime's activity is not impulsive but they are the results of the premeditated agreements and some sorts of understandings focus on penetration and later on taking control over some branches of national economy and making enormous profits of it.
-czy jest coś takiego co można nazwać ewolucją zorganizowanej przestępczości? Jest to proces normalnej reorganizacji organizacji trying to adjust to the market like legal businessem to legal market.
-organized crime jest zatem nieodłącznym atrybutem nowoczesnego społeczeństwa.
-często też mówi się, że jest to a series of complex activities on enormous scale by organization called a syndicate or others which build up their structures to make profits and political influences.
-according to the US legal system organized crime is a phenomena which includes syndicates, cartels and confederations.
-the US definition is quite different to a European one or defined by the UN system in the terms of globalization.
-Up to 1989 w Polsce I innych krajach postkomunistycznych nie występowało pojęcie zorganizowanej przestępczości. I zresztą co ciekawe w systemie komunistycznym nie było zbyt dużo miejsca na działalność zorganizowaną chociaż inne czynniki generowały takie a nie inne metody postępowania. Braki na rynku tworzyły czarny rynek a ten już sam w sobie traktowany był przez władze jako działalność antypaństwowa. Niemniej zorganizowana przestępczość miała bardzo ograniczony charakter i jako takie należy rozpatrzyć to zjawisko z socjologicznego punktu widzenia.
The more coercive a state The less organized crime, a state penetrates many fields which a beyond capacity of organized crime. Apart from all that people cannot organized themselves so perfectly as in liberal state.
-in the USA is still valid a definition from 1966 issued by The Commission of Law Enforcement and Administration of Justice - organized crime is a some sort of conspiracy with developed structure, based on inner hierarchy, discipline and fixed rules, which conducts a planned business-like activity aimed to monopolize some fields of national economy (especially in trade and services).
-definicja ta jest zaopatrzona (provided with) w tzw. sekcje, które są swoistymi poprawkami do ustawy.
-obecnie również uważa się, że działaniom zorganizowanej przestępczości towarzyszy użycia przemocy (violence) oraz zastraszanie (intimidation)
-W Europie: it distinguishes levels of crime activity and tries to define those crime acts which have nothing incommon with mafia's character.
-In Germany for the first time it was tried to define organized crime in 1973 when managers of local criminal offices set up a special committee to work out a precise definition, it's methods and effective methods of fighting against it.
-therefore the definition was as follows: organized crime includes those acts which are committed by more than two separated groups (associations) or several groups which cooperates not timely but for a long and premeditated time.
-in 1983 the new definition was implemented: organized crime is based on distribution of duties for a long time within a group of people cooperating with themselves and it is focused on committing crime acts, very often aimed at quick profits.
-In Poland the term should have been implemented at the turn of 1989/90. Zjawisko to jest trudne obecnie do oszacowania.
-Przyczyny pojawienia się zorganizowanej przestępczości w krajach postkomunistycznych?
-In Polish legal system The definition as in Rother countries is not very precised but a penalty is extender to The participation in The organized group focused on commiting a crime.
-the witness of the Crown was implemented at the end of 1990's and it came from the USA proved to be very effective.
THE UN CONVENTION
-is the definition aimed at fighting against organized crime.
-according to that: organized crime is a structured group composed by two o three people, existing by some time and acting with some sort of understanding to commit one or more crimes defined by the Convention, and their activities are focused on material or financial profits.
-it is vary hard to characterize international organized crime, especially as concerns universal criteria. The activity is limitless and is defined by the will of profit
-the new term was developed - crime of international concern - all the international crimes, except genocides and other acts included by the international penal law.
-International crimes are as follows:
1.premeditated murder based on criminal accounts (porachunki)
2.socialized economy crime and corruption
3.car theft and its transfer abroad
4.thaft of a work of art
5.extortions, robberies
6.international fraud
7.human organs trade
8.smuggling of people
ACCORDING TO EUROPOL
Organized crime is:
1.cooperation more between more than two people
2.everyone of whim has it's own duties
3.for longer time
4.by using various forms of discipline
5.suspected for committing serious crimes
6.acting on international scale
7.using violence and other methods focused on intimidation
8.money laundering
9.influences of the world of politics
10.activity focused on profit and power.
2.History of Organized Crime - the US as a case study (prohibition, gambling, extortions etc..)
3. The Conceptual History of Organized Crime in the United States
3.1. The Original Concept of Organized Crime Coined by the Chicago Crime Commission
The term "organized crime" first came into regular use among the members of the Chicago Crime Commission, a civic organization that was created in 1919 by businessmen, bankers and lawyers to promote changes in the criminal justice system in order to better cope with the crime problem.
In the announcements of the Chicago Crime Commission, organized crime referred not to criminal organizations but in a much broader sense to the orderly fashion in which the so-called "criminal class" of an estimated "10.000 professional criminals" in Chicago allegedly could pursue "crime as a business". The discussion centered around the conditions that seemingly allowed criminals to gain a steady income from crime, particularly property crimes, under virtual immunity from the law. In the eyes of the Crime Commission, the city government had to be blamed for incompetency, inefficiency and corruptness, while the public was criticized for indifference and even open sympathy towards criminals. This characterization of organized crime as an integral part of society apparently reflected the perspective of the old established protestant middle class on Chicago as a city that, after years of rapid growth and cultural change, was drowning in crime, corruption and moral decay.
3.2. The Depression Era
The original understanding of organized crime did not prevail for long. Beginning in the mid 1920s but especially during the Depression Era, the concept of organized crime changed significantly.
First of all, the term organized crime began to be used outside of Chicago. But only for a short time did it function as a generic term in the criminal-policy debate. By the mid 1930s it was almost completely replaced by the somewhat narrower concept of racketeering.
In the late 1920s and early 1930s organized crime no longer referred to an amorphous "criminal class" but to "gangsters and racketeers" who were organized in "gangs," "syndicates" and "criminal organizations" and followed "big master criminals" who functioned as "powerful leaders of organized crime". Some of these leaders moved into the limelight and gained celebrity status as "Public Enemies," most notably Al Capone.
While the picture of the "criminal class" became more and more differentiated the understanding of the relation between organized crime and society took a decisive turn. Organized crime was no longer seen as a product of social conditions that could be remedied easily, like the deficiencies in the criminal justice system the Chicago Crime Commission had denounced earlier. Instead of social and political reform, the emphasis now was on vigorous law enforcement.
3.3. The Kefauver Committee 1950-1952
From the late 1930s to the late 1940s the concept of organized crime had all but disappeared from the public debate. It returned in 1950 when a Senate Committee set out "to investigate organized crime in interstate commerce." The Committee under its chairman Estes Kefauver concluded that numerous criminal groups throughout the country were tied together by "a sinister criminal organization known as the Mafia".
The Kefauver Committee marked a significant change in the perception of organized crime in two respects. On the one hand, organized crime no longer appeared to be primarily a product of local conditions but instead as a problem that existed on a national scale and threatened municipalities from the outside. On the other hand, the notion of the Mafia as an organization of Italian-Americans added an ethnic component to the concept of organized crime. It is somewhat surprising that this had not happened earlier because the image of the Mafia as an Italian-American organization was not quite as new. It had first appeared in 1890 when the chief of police of New Orleans was murdered by alleged mafiosi.
Yet another aspect is noteworthy in this context. For the first time the law-enforcement community took an active role in the conceptualization of organized crime. It was the Federal Bureau of Narcotics that provided the testimony that led the Kefauver Committee to assert the existence of the Mafia in the United States.
In contrast, the FBI completely resented the concept of organized crime before 1963. Prior to 1963 its director J. Edgar Hoover had not only refused the notion of an Italian-American Mafia, he also criticized more general conceptions of syndicates and criminal organizations as a dominant factor in crime.
3.4. The Late 1950s to the Late 1960s: From Apalachin to "The Godfather"
The interest in organized crime and in the Mafia that the Kefauver Committee had stirred faded in the following years. But beginning in late 1957 a series of events brought organized crime back to center stage and eventually, by the late 1960s, led to the merging of the two concepts of organized crime and Mafia.
Organized crime had become synonymous with a single ethnically homogeneous organizational entity.
3.5. The 1970s: The Concept of Organized Crime Reconsidered
The Mafia-centered concept of organized crime that had evolved during the 1950s and 1960s had to no small degree been the result of a focus on New York City. Despite its tremendous impact on public perception it soon proved unsuitable for devising valid law-enforcement strategies for the entire United States.
After rejecting a proposal to outlaw membership in the Cosa Nostra, Congress passed the RICO statute in 1970 with an extremely broad underlying concept of organized crime.
Likewise many state commissions on organized crime which were established in response to the national debate at best paid lip-service to the concept of Cosa Nostra as an all-encompassing criminal organization. Instead, they defined organized crime in much broader terms to include less structured gangs and illicit enterprises.
A similar uneasiness with the Mafia paradigm was evident among law-enforcement officials on the state and local levels and even among members of the federal Organized Crime Strike Forces that had been established in a number of cities since 1967. While some defined organized crime to include only Cosa Nostra members others included any group of two or more persons formed to commit a criminal act.
3.6. The Concept of Non-Traditional and International Organized Crime in the 1980s and 1990s
Eventually, the notion that there was more to organized crime than the Cosa Nostra did not lead to a profound revision of the conception of organized crime. Instead, in the late 1970s and early 1980s the concept of non-traditional organized crime emerged which merely transfered the Mafia model to other ethnically defined criminal organizations allegedly similar to Cosa Nostra, such as East-Asian, Latin-American and Russian groups, outlaw-motorcycle gangs and so-called prison gangs.
In recent years, outlaw-motorcycle gangs and prison gangs have somewhat dropped out of sight while groups of criminals from Asia and Europe, especially criminals from the former Soviet Union, have received more attention. In comparison with Cosa Nostra they are now believed to be at least of equal importance, especially in view of the successful prosecution of numerous Cosa Nostra members in a series of RICO trials since the mid 1980s. Today, the concept of organized crime is applied to domestic crime groups like the Cosa Nostra and to what is now refered to as "international organized crime," that is criminal organizations believed to be operating on a global scale, including Chinese Triads and the so-called "Russian Mafia". It seems that to the extent the Cosa Nostra is believed to lose ground and organized crime is turning into an issue of international politics rather than to remain an issue of immediate relevance the American public has lost much of its prior interest in the subject.
3.7. Summary
In essence, during the last 80 years the perception of organized crime has evolved from an integral facet of big-city life to an assortment of global criminal players who challenge even the most powerful countries like the United States.
HISTORY OF THE US ORGANIZED CRIME
The pirates who plundered and looted merchant vessels in the seventeenth century and who undertook large-scale trade in stolen goods may be considered among the earliest organized crime groups to make their appearance in the Western world. Many of the activities that are associated with contemporary organized crime, such as prostitution, gambling, theft, and various forms of extortion, were also evident in the frontier communities of the nineteenth-century American West.
However, most observers locate the origins of the distinctly American style of organized crime in the urban centers of the late nineteenth and early twentieth centuries. In a fundamental way, urban conditions provided the kind of environment in which organized crime could flourish. The large population sizes provided a "critical mass" of offenders, customers, and victims and thereby facilitated the development of profitable markets in illicit goods and services. Moreover, the size and density of urban networks allowed criminal forms of organization to become diversified and encouraged the growth of essential support services (such as those offered by corrupt politicians or police).
These early forms of criminal organization were typically tied to local areas and because of the highly segregated character of the city, they had important ethnic dimensions. Irish neighborhoods, for instance, gave rise to street gangs with names like "The Bowery Boys" and the "O'Connell's Guards" and in Chinese, African American, Italian, and Jewish neighborhoods criminal organization similarly reflected local cultural and economic circumstances. Neighborhood conditions provided ample opportunity for local criminal entrepreneurs who were willing and able to engage in a various forms of extortion or illicit marketeering.
During the first two decades of the twentieth century, residents of the "Little Italies" of many eastern industrialized urban areas had to contend with a crude form of protection racket known as "La Mano Nera" or "the Black Hand." Those members of the local community who were better off financially might receive an anonymous note demanding that a sum of money be paid to the writer. If payment was not forthcoming, victims were typically warned that they could expect to have their businesses bombed or the safety of their family members jeopardized. Customarily, the extortion demand was signed with a crude drawing of a black hand. While the receiver of the letter (as well as other members of the community) were led to believe that the Black Hand was a large and powerful organization, it is more likely that the extortion was the work of individuals or a small group of offenders who used their victims' fear of secret societies (and often their fear of the police) to coerce payment.
While most forms of criminal organization prior to World War I were relatively small-scale operations, the situation changed dramatically with the introduction of Prohibition. The Eighteenth Amendment to the U.S. Constitution was ratified on 16 January 1919 and went into effect one year later. The intention of the national experiment was to control alcohol use through the prevention of the manufacture, sale, and transportation of intoxicating liquors. In essence, national prohibition had created an illegal market unlike any that had existed before.
It can be argued that national prohibition facilitated the consolidation of the power of criminal organizations. Although pre-Prohibition criminal enterprises had often been profitable, the revenue potential of Prohibition was unprecedented. While precise estimates of the amount of money that flowed through organized crime groups are difficult to make, it is clear that the manufacture and sale of illegal alcohol had become a major industry. In 1927, for instance, the U.S. Attorney's Office estimated that the criminal organization of the notorious Chicago gangster Al Capone had an annual income of $105 million. In subsequent years, the profits from the sale of illegal alcohol in Chicago and other cities funded the movement of criminal organizations into diverse sectors of both the licit and the illicit economies.
The importation and distribution of illegal alcohol also encouraged national and international linkages between criminal groups. For instance, the involvement of Canadian organized crime figures in smuggling operations that moved alcohol to the United States facilitated the eventual control by American organized crime groups of Canadian criminal operations in cities such as Toronto and Montreal. On a national level, intergroup cooperation was evidenced by regional conferences of those involved in the illicit liquor business. One such major gathering of crime figures was held in Atlantic City in 1929 and was attended by representatives from criminal organizations located in several major urban areas.
Importantly, the profitability of those industries that subverted national prohibition fostered an environment of widespread corruption in several cities. For many members of the general public as well as many law enforcement and elected officials, prohibition lacked any real moral authority. The relationships between criminal organizations and the political machines that held sway in many cities were stabilized during Prohibition, and the intricate connections between these sectors of the urban social fabric were maintained for decades to come.
The Great Depression of the 1930s did not affect the business of organized crime to the degree it affected many aspects of the legitimate economy. After Prohibition ended in 1933, major criminal organizations diversified and became increasingly powerful in the process. Gambling, loan-sharking, and the growth industry of narcotics distribution became important sources of criminal revenue as repeal threatened the proceeds from the illegal sale of alcohol.
An increasingly significant area of enterprise during this period was "racketeering." While the term may be defined many different ways, it generally refers to the variety of means by which organized crime groups, through the use of violence (actual or implied), gain control of labor unions or legitimate businesses. Often, though, the relationships that joined organized crime groups to unions or legitimate business were mutually advantageous. The leadership of a labor union, for example, might seek to exploit the violent reputation of those involved in organized crime in order to pressure an employer to meet a demand for concessions. Similarly, a business owner might attempt to control the competitive character of the legitimate marketplace or to avert labor troubles through affiliation with those willing to use violence and intimidation in the pursuit of economic goals. The International Longshoremen's Association and the International Brotherhood of Teamsters are among the best known examples of labor organizations affected by racketeering.
In 1950, organized crime became a highly visible part of American popular culture. A series of televised congressional hearings chaired by Senator Estes Kefauver sought not only the testimony of law enforcement experts but also of supposed members of organized crime networks. In general, the latter type of witness tended to remain silent or to otherwise express an unwillingness to provide evidence. These refusals made for startling television viewing and were interpreted by many observers as unambiguous proof of the sinister character of the problem of organized crime.
In its final report the Kefauver committee concluded that organized crime in America was largely under the control of an alien conspiracy known as "the Mafia." The Kefauver committee argued that the organization, which was said to have its origins in Sicily, was firmly in control of gambling, narcotics, political corruption, and labor racketeering in America. The Mafia, it was suggested, cemented its power through the use of violence, intimidation, and corruption.
The influence of the Kefauver committee in shaping postwar perceptions of organized crime as the product of an alien conspiracy, which subverts American social structure rather than emerging from it, cannot be underestimated. Its findings influenced significantly the ways in which policymakers, journalists, academics, and members of the general public would think about the problem of organized crime for decades to come. However, critics have charged that the committee was more engaged by the process of public drama than by a search for the truth. In this respect, it can be argued that the committee had very little proof upon which to base the startling conclusions that it reached about the nationwide conspiracy of ethnic criminals.
A number of developments in subsequent decades nevertheless appeared to be consistent with the findings of the Kefauver committee. In 1957, an apparent conclave of Mafia members was raided in the small upstate town of Apalachin, New York. In 1963, another congressional investigation of organized crime (known popularly as the McClellan committee) heard testimony from a supposed Mafia insider, named Joseph Valachi. According to Valachi, the control of organized crime in America rested with an organization known as "La Cosa Nostra" rather than the Mafia. Valachi described the character of the organization, the oaths that its members took, and recounted the historical process by which the modern La Cosa Nostra was formed after a purge of the older and more traditional Mafia leadership of the 1930s. Once again, critics pointed out that very little of what Valachi had to say could be corroborated independently and that he himself had a record of lying to law enforcement authorities when it suited his purpose. Still, Valachi's testimony helped strengthen a kind of ideological and moral consensus around the view of organized crime as an alien parasitic conspiracy rather than as a problem indigenous to American social life. Moreover, his testimony and the work of the McClellan committee more generally legitimated the subsequent development of investigative approaches to organized crime, including the widespread use of wiretaps, witness immunity, and other strategies facilitated by the passage of the Organized Crime Control Act of 1970.
In 1967, President Lyndon Johnson appointed the President's Commission on Law Enforcement and Administration of Justice to examine all aspects of crime and justice in America. One of the task forces associated with this commission was charged with the responsibility of investigating the nature and dimensions of organized crime. The report of that task force, shaped principally by the well-known criminologist Donald Cressey, reinforced and extended the view of organized crime as an alien ethnic conspiracy. According to the task force, La Cosa Nostra was comprised of approximately five thousand members organized within twenty-four "families" each of which was associated with a particular regional sphere of influence. Moreover, these families were said to be organized in terms of a rigid hierarchical chain of command. The highest level of decision-making in the organization was a "National Commission" that served as a combination legislature, supreme court, and board of directors.
While a number of critics dissented, there was a widespread consensus by the 1970s that organized crime did indeed reflect an Italian American hegemony. The apparent findings of investigative commissions and task forces were underwritten by films such as The Godfather, The Valachi Papers, and Mean Streets as well as by other elements of popular culture. At the same time, it was increasingly acknowledged that other groups were beginning to make significant inroads in organized crime. Typically described in terms of their ethnicity, such groups were said to include African Americans, Hispanics, Asians, and Russians. The powerful character of earlier organized crime imagery affected the ways in which such groups were labeled by the mass media and by relevant policy communities and it became common to speak of the growing power of the black, Mexican, or Russian "Mafias."
By the 1980s many observers had come to the conclusion that whatever control La Cosa Nostra exerted over organized crime was in decline. The systems of widespread corruption that had emerged out of Prohibition typically involved well-articulated relationships between organized crime groups on the one hand and established political machines on the other. These machines, which facilitated the centralization of police and urban political corruption, had largely disappeared by the 1970s. Moreover, because municipal policing had become more professionalized and because federal agencies had begun to develop an increasing interest in the activities of organized crime, the bases of large-scale, long-term corruption had been undermined.
The passage of new legislation aimed at the control of organized crime and the aggressive prosecution of cases involving Italian organized crime figures also did much to weaken the hold that La Cosa Nostra had on licit and illicit businesses. Perhaps most important in this respect was the passage of the RICO (Racketeer Influenced and Corrupt Organizations) Act and related statutes. The members of Italian American organizations in Philadelphia, Kansas City, Boston, and elsewhere were effectively prosecuted and high-visibility cases were brought against well-known figures such as John Gotti and the heads of the five New York crime families were seen as clear proof of the power of the prosecutorial assault.
It is also worth noting that the decline within urban areas of traditional Italian communities and the movement of second and third generations to the suburbs removed from cities much of the popular support that many organized crime figures had previously enjoyed. In addition, it has been suggested that the continued tendency of the Mafia (or La Cosa Nostra) to recruit new members from a dwindling pool of uneducated and violent felons did little to ensure the adaptability of the organization as the business of organized crime became more complex at the end of the twentieth century. In addition, the gains made by other ethnic groups often came at the expense of the Italian American crime syndicate's interests. The traditional control of the heroin markets was lost to Mexican and Asian groups whose strategies for importation of the drug did not depend on the muscle that the Mafia may have been able to exert for so long against the New York waterfront. Similarly, the very lucrative cocaine business was under the control of Colombian cartels rather than Cosa Nostra families. The cartels required neither the financing nor the private violence that the Italian syndicate might have been able to lend to the operation of an illicit market. Such groups were themselves well financed and in possession of their own fearsome reputations regarding the use of violence to settle disputes or to threaten competition.
The concern in the 1980s and 1990s about the emergence of new organized groups was accompanied by a concern about the increasingly transnational character of organized crime. This crime trend has been understood, in large part, as an outcome of the post-cold war reconfiguration of national and economic boundaries. The reduction in trade restrictions, the development of global systems of finance and telecommunications, the increasingly transparent nature of national borders, and the dramatic internal changes in many nations (such as those in the former Soviet Union) made it easier for criminal conspirators to expand their operations internationally. Such operations are tracked, investigated, and prosecuted with great difficulty since effective enforcement requires levels of international cooperation among policing agencies from different nations that often vary markedly regarding their enforcement priorities and the resources available to them.
Police intelligence during the period suggested, for instance, that organized crime groups from the former Soviet Union, Asia, and Italy were forming partnerships among themselves as well as with drug merchants in Central and South America. As in the case of legitimate business, such foreign expansions resulted from the desire to engage new markets. The links between Colombian drug cartels and the Sicilian Mafia, for example, reflected an interest on the part of the cartels to enter European markets where, as compared to the United States, cocaine could be sold at a higher price and where drug enforcement activity was less aggressive. Estimates of the economic impact of transnational crime are difficult to make and run as high as several hundred billion dollars annually.
Prohibition
Prohibition was not a new phenomenon in the 1920s. There had been various anti-alcohol campaigns since the colonial period. The Maine Law of 1851, for example, prohibited the manufacture and sale of intoxicating liquors within the state of Maine. By 1855, thirteen of the thirty-one states had adopted similar prohibition legislation. During the Civil War, moreover, the federal government prohibited alcoholic beverages in the Union Army as a way to ration grain for hungry soldiers.
As so often happens in the United States, leaders of this social movement tried to justify their views with scientific evidence. Temperance advocates, for example, founded the Scientific Temperance Journal after the Civil War. Schoolchildren's textbooks depicted human organs degenerating from an overabundance of drink. In the 1870s, the Women's Christian Temperance Union (WCTU) promoted the use of public education for the cause of temperance. They succeeded in getting their propaganda in textbooks and, by 1902, every state and territory except Arizona had a law requiring temperance instruction in the schools. The prohibitionists also used eugenics--the study of hereditary improvement of the human race by controlled selective breeding--to bolster their cause. They argued that immigrants were inferior due to the fact that their children had been drinking since a young age.
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The WCTU and the Anti-Saloon League Two organizations helped to foster prohibition sentiment throughout the United States: the Women's Christian Temperance Union (WCTU) and the Anti-Saloon League. The WCTU fought not only for the cause of prohibition, but represented most progressive reform groups of the day. Under the leadership of notable reformer Frances Willard--national president of the union from 1879 to 1898--the WCTU took up the causes of suffrage, the 8-hour work day, prison reform, and the Social Gospel. The efforts of the WCTU made temperance attractive to numerous reformers. Progressives, for example, viewed Prohibition as a way to attack the bosses of urban political machines, whose headquarters were often located in saloons. |
In contrast to the WCTU, the Anti-Saloon League, founded in 1896, focused only on the legal prohibition of alcoholic beverages. The Anti-Saloon League developed modern lobbying techniques that were hugely successful. The League, for example, printed and disseminated anti-drinking brochures, appealed to church members for support, and lobbied both lawmakers and businessmen. The Anti-Saloon League was so persuasive in its lobbying efforts that 28 states had adopted prohibition laws by 1918, before national prohibition went into effect.
By and large, Prohibition represented the desires of the Anglo-Saxon establishment. The typical prohibitionist was:
A rural or small-town inhabitant
Middle class
Anglo-Saxon
Evangelical Protestant
Fearful of African-Americans, immigrants, Jews, and Catholics
Prohibitionists had various motivations for campaigning against alcohol. Most believed that drinking liquor was immoral. Others wanted to take away the power of the urban political machines. Still others used the movement as a springboard for their personal political ambitions.
World War I and Prohibition
The entry of America into World War I aided greatly the cause of prohibition.
War time hysteria against all things foreign linked prohibition to patriotism. Prohibitionist propaganda characterized the liquor industry as foreign-controlled and pointed out that German-Americans owned and managed many of the nation's breweries.
Centralization of government power. During WWI, the federal government took over railroads and factories, passed a conscription act, and curtailed liberty and free speech. As an outgrowth of this centralization of power in Washington, D. C., many Americans increasingly viewed the federal government as the upholder of American morality, temperance, and sobriety. In their minds, the federal government should limit individual freedoms for the sake of higher social responsibilities.
The saloons went underground and became speakeasies. There were lots of them. The 16,000 saloons in New York City, for example, became (depending on whose estimate you believe) from 32,000 to more than 100,000 "speaks." Unlike the saloons, which were men-only institutions, the speak-easies welcomed women, and the women came.
Supplying the speakeasies with the necessary beer, wine, and liquor required organization. It was also a crime. Hence, the birth of organized crime. Paying off the local, state, and federal authorities required some organization too—and no small amount of money. Due to the outrageously inflated alcohol prices caused by Prohibition, money was no problem. In one year, Al Capone made $60 million (the equivalent of about $2 billion today) in liquor sales alone—a regular Bill Gates.
Mexico was wet, and Canada was far from dry. The border towns, both north and south, were well supplied with Jos Cuervo and Canadian Club.
Anchored just outside the three-mile limit, lining both the Atlantic and Pacific coasts, were ships laden with spirits from other lands. (In all history, the only country to ever even attempt complete prohibition was the United States.) Some of these boats catered only to the professional bootlegger, but many would sell liquor by the case to the amateur rumrunners who either owned or rented boats. The rental of pleasure boats increased sharply during Prohibition.
Beer brewing, wine making, and distilling became common practices in the home. An enterprising home brewer could make enough liquid refreshment to give as gifts or even sell. (When selling, of course, one had to be careful: one did not want to be caught by the feds or, worse, by the mob.)
Placement;
Layering; and
integration.
the need to conceal the origin and true ownership of the proceeds;
the need to maintain control of the proceeds;
the need to change the form of the proceeds in order to shrink the huge volumes of cash generated by the initial criminal activity.
the establishment of anonymous companies in countries where the right to secrecy is guaranteed. They are then able to grant themselves loans out of the laundered money in the course of a future legal transaction. Furthermore, to increase their profits, they will also claim tax relief on the loan repayments and charge themselves interest on the loan.
the sending of false export-import invoices overvaluing goods allows the launderer to move money from one company and country to another with the invoices serving to verify the origin of the monies placed with financial institutions.
a simpler method is to transfer the money (via EFT) to a legitimate bank from a bank owned by the launderers, as `off the shelf banks' are easily purchased in many tax havens.
The Terrorism Act 2000
The Anti-Terrorist Crime & Security Act 2001
The Proceeds of Crime Act 2002
When police in Naples, Italy, searched Lucky Luciano's home several years after the Havana getaway, they found a gold cigarette case with the inscription, “To my dear pal Lucky, from his friend, Frank Sinatra.”
Chicago boss Sam Giancana was known to wear a star-sapphire pinkie ring that was a gift from Sinatra.
The press had published damning photographs of Sinatra posing with known Mafia members.
In conversations secretly taped by the government, gangsters mentioned Sinatra's name frequently, and not only with regard to his singing and acting talents.
Joseph ''Doc'' Stacher - the No. 1 man who ran the hotel and who was closely associated with Meyer Lansky. Stacher had a long police record that included arrests for assault and battery, robbery, larceny, bootlegging, hijacking and murder. He was also a very close friend of Sinatra.
Charles ''Babe'' Baron - the official greeter at the hotel, he had previously been a suspect in a murder.
Joe Fusco - of the old Capone mob.
Meyer Lansky - The highest ranking non-Italian member of ''The Syndicate.'' Lansky had been closely associated with Charles ''Lucky'' Luciano, and, since his teen years, had partnered with Benjamin ''Bugsy'' Siegel.
Abner ''Longy'' Zwillman - an early member of Irving ''Waxy Gordon'' Wexler's bootlegging operation in New Jersey. He later was a partner with Willie Moretti and was closely associated with Meyer Lansky.
Anthony ''Tony Batters'' Accardo - former bodyguard of Al Capone and power behind the Chicago throne from 1943 until his death in 1992.
Gerardo Catena - acting boss of the Genovese family.
Abraham Teitelbaum - former attorney of Al Capone.
John Roselli - Giancana's representative in Las Vegas. He had been involved in the early `60s plots against Fidel Castro. In 1963 Sinatra sponsored Rosselli for membership in the Friar's Club, where Roselli was later charged with running a gambling operation. Roselli moved to Miami after Giancana's removal from Chicago. In 1975 Roselli testified to the U.S. Senate's Church Commission about links between the Mafia and the CIA. Shortly after his testimony his dismembered body was found in an oil drum floating in Biscayne Bay.
It is estimated that over 2 million people are trafficked every year
1.2 million children are affected by trafficking - ¼ of a million in Asia/Pacific region
Human Trafficking is a lucrative worldwide business of over £6 billion per year
Over 50,000 Filipino children have been forced into prostitution
In Thailand: 60,000 children sold into prostitution.
In the former Soviet Union: an estimated 10,000 women were forced into prostitution in Israel.
In North America: Asian women are sold to brothels for $16,000 each.
In the UK: trafficked women are forced to see around 30 - 40 clients per day.
Dominated by publicly-held companies, many with household names like Hilton and Sheraton.
Answerable to their shareholders who are thousands of individuals and institutional investors.
Answerable to the Securities Exchange Commission.
Indistinguishable from any other business with accountants, attorneys, payroll specialists, auditors, and market researchers.
Licensed and tightly-regulated by state governments.
In 1986, Asian games were introduced and club revenues went from around $12 million per year to $60 million, then $80 million annually.
One of the club's pit bosses was arrested and eventually plead guilty to seven counts of extortion and weapons' violations.
Wall Street Journal article identified the Asian Games manager as a member of an Asian crime family.
The Internal Revenue Service fined the club $4.2 million for ignoring laws designed to prevent money laundering.
Government audits turned up a lack of adequate cash reporting and internal accounting controls.
The Attorney General alleged that the founder is skimming millions in the form of kickbacks from the manager of the Asian games.
Three more employees were arrested involving possession of automatic weapons and heroin smuggling. They provided evidence that led to the arrest of the manager for Asian games on conspiracy and extortion charges.
A new Asian Games Manager was hired. Part of the job was for her to grant credit to gamblers and pay operating expenses. Her money came from an organized crime figure.
The sale of the club was discussed with organized crime figures. One is in Nevada's "Black Book," meaning he is barred from even walking into a casino. The deal eventually fell through.
The casino manager suspends the next Asian games manager. The City of Bell Gardens then forced the manager to reverse the action and canceled the work permit of the club security manager. The Department of Justice suspended the license of Asian games manager and that of the Casino manager.
The Attorney General alleged that the federal trustee had knowingly allowed illegal activities at the club, including loan sharking, kickbacks, and cheating.
Caricature of Herbert Hoover and the "noble experiment" of Prohibition |
Copyright 1997 State Historical Society of Wisconsin |
I see that you, too, put up monuments to your great dead. |
A FRENCHMAN |
· Grain alcohol was legal when sold for "industrial use only." With the right alterations, however, it became safe to drink and, with the right recipe, occasionally palatable. One could mix up a batch of this in the bathroom; hence, bathtub gin.
· The California grape growers, no longer permitted to make wine, produced a grape juice product known as Vine-Glo. The Vine-Glo literature carefully instructed buyers what not to do, because, if they did those things, they would have wine in sixty days. The demand for grape juice grew dramatically. In 1919, 97,000 acres were devoted to growing grapes for "juice." By 1926, it was 681,000 acres. In 1929, the U.S. government loaned the grape growers money to expand even further.
· Beer with an alcohol content of less than one-half-of-one percent (named "near beer," although many claimed that those who gave it that name were lacking in depth perception) was legal. In order to make it, however, one had to make regular beer and then boil off the alcohol. Every so often, somebody forgot to take that last step and real beer accidentally wound up for sale in speakeasies (Oops).
· All you had to do to stay entirely within the law was get sick. The Eighteenth Amendment only prohibited alcohol for "beverage purposes." Medicinal alcohol was perfectly legal and, for some unknown reason, doctors began prescribing more and more of it during the 1920s. In addition, various elixirs, tonics, and other patent medicines available over-the-counter without prescriptions relied heavily upon the medicinal qualities of alcohol. (Very heavily.)
When I sell liquor, it's bootlegging. When my patrons serve it on a silver tray on Lakeshore Drive, it's hospitality. |
In a little more than a decade, the holy war called Prohibition was lost. In 1920, John F. Kramer, the first commissioner charged with enforcing Prohibition, somberly stated, "The law says that liquor to be used as a beverage must not be manufactured. We shall see it is not manufactured, nor sold, nor given away, nor hauled in anything on the surface of the earth or under the earth or in the air."
By 1931, it was all but over. A presidential committee reported the obvious: Prohibition was not working. By 1932, both presidential candidates, Franklin D. Roosevelt and Herbert Hoover, favored repeal.
After his presidential victory, Roosevelt had Congress amend the Volstead Act to permit beer with a 3.2% alcohol content. On December 5, 1933, the Twenty-first Amendment to the Constitution officially repealed the Eighteenth Amendment—the only time in the history of the United States that an amendment has been repealed—and Prohibition was history.(*FN)
[FN* The Twenty-first Amendment allowed the states to choose for themselves whether or not they would be dry. Kansas chose to stay dry until 1948, Oklahoma until 1957, and Mississippi until 1966.]
It may have been history, but the effects of Prohibition lived on; some of them are still with us today. Here are the results of our country's "great social and economic experiment":
1. It created disrespect for the law. Never before had so many otherwise law-abiding citizens broken the law—and had so much fun doing it.(*FN) If this law was so enjoyable to break, what other laws might be worth ignoring too? Many also concluded that all laws regarding alcohol must be worthless. "Who said I shouldn't drive when I'm drunk? I think I drive better after a few drinks. And who set these repressive speed limits anyway?" That was the sort of dangerous thinking fostered by Prohibition.
[*FN The violations were astonishing. The flouting of the law had an auspicious beginning in 1920 with a still found on the farm of Senator Morris Shepard. It was producing 130 gallons of whiskey a day. Senator Sheppard was the author of the Eighteenth Amendment. Midway through the experiment, federal law enforcement officers set up their own speakeasy in midtown Manhattan. It took them nine months to get caught, and when they were, they simply claimed they were "investigating." By the end of Prohibition, a San Francisco jury drank the evidence and declared the defendant not guilty.]
2. It eroded respect for religion. God and the Bible were used to justify Prohibition and, as Prohibition failed, it seemed to some as though the failure was God's. Did the evangelicals who caused the suffering and chaos admit they had made a mistake? No. Prohibition's failure was simply a sign that "Satan never sleeps," and they were off prohibiting other things—drugs, prostitution, and "isn't it time we did something about these scandalous motion pictures? Have you seen the latest Mae West? Disgusting!"
3. It created organized crime. Prior to Prohibition, organized crime was nothing to speak of. Prohibition made the gangster not just well paid, but well liked. These aren't real bandits, the public thought, these are Robin Hood-like characters—blockade runners—who sidestep the law to bring us what we want. They were given cute nicknames like "Pretty Boy," "Legs," and "Scar Face." By 1927, Al Capone controlled not only all illicit commerce in Illinois—from alcohol to gambling to prostitution—but also the majority of the politicians, including most police commissioners, the mayor of Chicago, and the governor. By the end of the decade, organized crime was so organized they had a national convention in Atlantic City. Who could forget Dutch Schultz from New York? Solly Weissman from Kansas City? The Purple Gang from Detroit? Even when the chairman of the board, Mr. Capone, took an enforced vacation in 1931 (jailed for income tax evasion) and Prohibition ended in 1933, the "company" did not go out of business. It simply found new merchandise and services to market.
The country couldn't run without Prohibition. That is the industrial fact. |
The syndicate did not differentiate between crimes with and crimes without innocent victims. Once outside the law, their stock in trade became doing anything illegal—for a price. The "protection" racket preyed on honest, independent business people. When the mob was asked to "enforce" a contract (people in the underground seldom have access to the court system and, when they do, seldom have patience for, as Shakespeare called it, "the law's delay"), the enforcers rarely investigated to see whether or not the claim they were enforcing was fair. They took their money and made their hit, which could be anything from a threat to a murder.(*FN)
[*FN Henry Ford hired hundreds of mobsters to pose as workers, infiltrating his plants, and spy on other workers, some of whom were attempting to organize a trade union. It was an open secret that the fellow worker you were talking to on the assembly line might be a syndicate member working directly for Henry Ford. This scare tactic worked for some time and, when the fear wore off and union organizing continued, organized crime was ready, willing, and able to express Mr. Ford's displeasure of organized labor in a more persuasive way. Only when the union organizers made a few deals with the mob did the auto union finally succeed.]
Some organized crime went legitimate, but their sales techniques were not necessarily those Dale Carnegie would approve. After Prohibition, the mobsters had a lot of unused trucks and warehouses. Some got into trucking and warehousing. Try as they might to stay legitimate, once one is used to strong-arm tactics to sell one's products, settle disputes, or wipe out—uh, successfully overcome the challenges of—the competition, it can be difficult not to backslide.
How do you look when I'm sober? |
When organized crime takes over even a consensual crime, such as drugs, innocent victims suffer because the mob doesn't observe the same controls or restraints as legitimate businesses. The scene from the movie The Godfather in which the heads of the five families gather to discuss the future of drug distribution (One of them says, "I want it regulated! I don't want it sold near schools or playgrounds.") is, well, fiction. Organized crime is famous for its democratic approach to money: all dollars are created equal and a nicety such as the age of the person bringing the dollars is not a concern.
In short, Prohibition created an organized criminal class which is with us to this day.
4. Prohibition permanently corrupted law enforcement, the court system, and politics. During Prohibition, organized crime had on its payroll police, judges, prosecutors, and politicians. If mobsters couldn't buy or successfully threaten someone in a powerful position, they either "wiped him out" or, following more democratic principles, ran a candidate against the incumbent in the next election. They put money behind their candidate, stuffed the ballot box, or leaked some scandal about the incumbent just before the election (or all three). The important thing was winning, and more often than not, someone beholden to organized crime rose to the position of power.
All I ever did was supply a demand that was pretty popular. |
After more than twelve years of purchases, threats, and elections, organized crime had "in its pocket" the political and governmental power structure of most medium-to-large cities, and several states.
After Prohibition, some organized crime bosses made a fortune wielding this power. As good capitalists, they sold police protection, court intervention, and political favors to the highest bidder. Some of these bidders, it turns out, were guilty of crimes that had innocent victims or received government approval for schemes that victimized many. The police, courts, and politicians didn't differentiate between crimes with or without innocent victims any more than organized crime did—and if an official had a sudden fit of morality, it was too late: after years of corruption, the syndicate added blackmail to its list of persuasive techniques.
A great many famous men—names we recognize and respect today—were said to have "underworld connections." Those men sometimes used organized crime and its connections to obtain certain political favors: favors to help their businesses, conceal family indiscretions, or—spoiled as rich people often are—simply get their way. In addition to those directly under the thumb of organized crime, Prohibition created a class of police, judges, prosecutors, and politicians who were, in a word, buyable. When Al Capone went away in 1931, some of his corrupt elected officials sold their services to the highest bidder. There were, of course, plenty of bidders and, because of Capone's thoroughness, plenty of sellers.
The world is made up for the most part of morons and natural tyrants, sure of themselves, strong in their own opinions, never doubting anything. |
Not only were honest citizens unprotected from schemes the government was supposed to protect them from, but dealing with a dishonest city government—from getting a permit to an unbiased day in court—often required a payoff. In some cities, corruption went from top to bottom, and it was the citizenry who suffered. There were plenty of corrupt politicians before Prohibition, just as there were criminals, but the sheer volume of money (and, consequently, corruption) that Prohibition brought with it created what might be called organized corruption on local and state levels. The new police, judges, prosecutors, and politicians were told to look the other way as the graft passed by, and some succumbed to the easy money they saw being made all around them. Some popular beliefs (and, in some cases, truths) about law enforcement, politics, and government in general ("You can't fight City Hall." "The rich get away with murder." "You can't change the system.") were not necessarily created by Prohibition's political corruption, but it certainly supported them in people's minds.
Prohibition forced a number of citizens to conclude that government cannot be trusted—an unfortunate point of view with even more unfortunate consequences.
5. Prohibition overburdened the police, the courts, and the penal system. Even with only token enforcement, Prohibition violations overburdened the police, clogged the court system, and filled the jails. The honest police, judges, and prosecutors found it impossible to do their jobs; there wasn't enough time, personnel, or money. On March 3, 1923, Time reported that "44% of the work of the United States District Attorneys is confined to Prohibition cases." By 1928, there were more than 75,000 arrests per year. In 1932, there were 80,000 Prohibition convictions (not just arrests, but convictions).
You can fool too many of the people too much of the time. |
6. People were harmed financially, emotionally, and morally. The basic inequity of Prohibition was astounding. Prohibition caused a direct hardship on hundreds of thousands, perhaps millions of people. First, there were those who, in 1919, were legitimately involved in the production, distribution, and sale of alcohol. They either lost their jobs or were forced to become criminals. (If what you've been doing your entire professional life becomes illegal and you keep doing it, you become a criminal.) Brewing, distilling, and wine making are arts—professions that have been practiced and refined over thousands of years. What are people to do when their profession, honored and respectable, suddenly becomes a crime? With few options, some turned from brewmaster to bootlegger overnight. Others couldn't stand the idea of being a criminal and took far lower paying and less fulfilling jobs.
And what about the people who owned the breweries, distilleries, and wineries? Many had invested their lives and savings in equipment, research, and good will. Overnight, through no fault of their own, their businesses were destroyed and investments wiped out. If it was a publicly held company, the stockholders, (many of whom were small investors) found their stock suddenly worthless.
Then there were the tens of thousands of workers employed in honest jobs—or who came back from the war looking to be rehired at their jobs—making, bottling, packaging, distributing, selling, delivering, serving, and growing the raw materials for alcoholic beverages. Imagine if the industry in which you worked was declared "immoral" by a powerful religious faction and it suddenly became illegal. What would you do? The negative propaganda—much of it grossly exaggerated or downright dishonest—disseminated by the evangelicals tainted the entire alcoholic beverage industry and everyone who worked in it. It was hard for these people to find jobs in other industries. Saying, "I worked in a brewery" or "I worked in a liquor store" had a tinge of disrespectability. Many of these people, out of economic necessity, were forced into a life of crime, doing precisely what they did before it became a crime.
There should be asylums for habitual teetotalers, but they would probably relapse into teetotalism as soon as they got out. |
Then there were the tens of thousands of people who worked in bars, restaurants, beer gardens, hotels, resorts, and related businesses that went out of business as a direct result of Prohibition. Yes, the speakeasies could hire some of these people—if they became criminals. Others, in order to keep their jobs, had to look the other way. Although hotels, for example, had sternly worded signs warning that drinking alcohol in hotel rooms was a federal crime and that violators would be prosecuted, the sight of a bellman carrying a tray with nothing but glasses, ice, and a bottle or two of ginger ale was common. The bellman in this instance, in order to keep his job, had to become an accessory to a federal crime. Such difficult choices corrupted the morals of millions.(*FN)
[*FN In George Bernard Shaw's Pygmalion, Henry Higgins asks Alfred P. Doolittle,"Have you no morals, man?" to which Doolitle calmly replies, "Can't afford 'em." A lot of people, some of whom may have favored Prohibition, found themselves in similar situations: the farmer selling grain or grapes to a known bootlegger, the landlord renting a basement knowing it might become a speakeasy, the entertainer or musician offered a job playing in a speakeasy.]
7. Prohibition caused physical harm. When "safe" alcoholic beverages were no longer available (that is, beverages in which the purity and alcoholic content were regulated by law), people began assembling all sorts of concoctions, either for their own use or for sale. Some worked; some didn't. Some killed. Alcohol made from fruits, vegetables, or grains—either fermented or distilled—tends to be safe. Alcohol distilled from wood products ("wood alcohol") is not. Wood alcohol, nonetheless, smells like alcohol, tastes like alcohol, and gets you high.
Every major horror of history was committed in the name of an altruistic motive. |
Some desperate people tried to find ways of making wood alcohol safe to drink; some despicable people repackaged it and sold it as "the real thing." Some used the less expensive wood alcohol to cut the more expensive grain alcohol to make it go further. During the Noble Experiment, more than 10,000 people died from wood-alcohol poisoning, 1,565 in 1928 alone.
With "cutting" becoming a common practice in bootlegging and tens of millions of people drinking each day, the only reason this figure wasn't higher was because of a peculiar characteristic of wood alcohol: before you died from it, you would go blind—permanently, irreversibly, blind. While drinking, if one's vision began to go, the drill was clear: stop drinking and upchuck as much as you could, as fast as you could. If people acted quickly enough, sometimes they would not end up with complete blindness, but with impaired vision—plus permanent kidney, liver, and brain damage.
Rather than having a little "Christian charity" for these people who, if alcohol had been legal, would have had nothing more than a hangover, the evangelicals proclaimed that people harmed by drinking wood alcohol "had it coming" for breaking both God's law and the law of the land.
In addition, there were the various beatings, stabbings, shootings, and killings between the bootleggers and the feds, the feds and the bootleggers, and the bootleggers amongst themselves. Along the way, any number of innocent people were caught in the crossfire, saw something they shouldn't have seen and were eliminated, or were rubbed out due to "mistaken identity."
In a generation, those who are now children will have lost their taste for alcohol. |
8. Prohibition changed the drinking habits of a country—for the worse. Prior to Prohibition, almost all drinking took place outside the home. Some—mostly recent immigrants—had beer or wine with meals; some of the rich had a little brandy or port after dinner; but, for the most part, alcohol consumption in the home was "for medicinal purposes only." Because the public drinking places closed, people (especially the poor: speakeasies tended to be expensive) began drinking at home more and more. With liquor now conveniently stored at home, people could drink more often.
Another phenomenon was drinking to get drunk. Prior to Prohibition, alcohol consumption was secondary to eating or socializing. With Prohibition, people gathered with the primary intention of getting drunk. ("I got a new bottle, just off the boat. Come over tonight and we'll drink it.") Although some speakeasies served food, people didn't go to the speakeasies to eat; they went to drink.
Prohibition also forced people to drink more than they usually would: if caught with a bottle, one could be arrested, so, before traveling, one tended to finish it. This got people into the habit of drinking more. If it was illegal to carry a bottle with you and you weren't sure there would be liquid refreshment at your destination, you might drink enough for the entire evening prior to leaving home. This got Americans in the habit of driving drunk.
The open and increasingly fashionable flouting of Prohibition caused drinking to become a public occurrence. The hip flask became a symbol of rebellion. It was used everywhere: football games, theaters, at work. People carried booze in hollow canes, hot water bottles, even garden hoses wrapped around their waists.
Robert Benchley's list of infallible symptoms of intoxication in drivers: When the driver is sitting with his back against the instrument panel and his feet on the driver's seat. When the people in the back seat are crouched down on the floor with their arms over their heads. When the driver goes into the rest-room and doesn't come out. |
Prior to Prohibition, women drank very little and almost never drank distilled spirits. Some women had a little elderberry wine, some a little sherry. That immigrant women drank beer or wine was considered an outrage to the guardians of (Protestant) morality, and keeping this evil habit from spreading to the pure womanhood of (Protestant) America was one of the Prohibitionists' most persuasive arguments. Prohibition, in fact, had just the opposite effect. Saloons, which were all-male preserves (except for bar maids, entertainers, and ladies of the evening), gave way to the speakeasies, which were decidedly coeducational. Outside the speakeasy, the passing of the flask included women as well as men. At home, men included their wives (and sometimes wives included themselves)in imbibing. Now that alcohol had to be stored at home—an uncommon practice prior to Prohibition—women decided to take a taste and find out what all the fuss was about. They found out.
Another necessary invention of Prohibition made alcohol far more popular: the cocktail. People turned to hard liquors during Prohibition because, drink for drink, it was cheaper to produce and easier to transport than beer or wine. In the same amount of space it took to transport eight ounces of beer, one could transport eight ounces of alcohol, which became the basis for eight drinks. In addition, the quality of unaged distilled alcohol was, to say the least, harsh. ("Sippin' whiskey," brandies, and other liquors designed for direct consumption are aged for years to mellow the flavor and take the edge off.)
The solution? Simple. The cocktail. Prior to Prohibition there were few mixed drinks. Gin and tonic began as a medicinal preparation during the British colonization of India. To protect against malaria, the British consumed a small amount of quinine mixed in water each day and, to take the bitterness from the quinine, they would add some sugar. To this, gin was added, initially for medicinal purposes. Long after returning to England, and with malaria no longer a concern, the Englishman continued consuming gin and tonics recreationally. Scotch mixed with a little soda or water was acceptable, but not terribly popular. And that was about it. The mixing of alcohol with every known sugar-water combination, soft drink, and fruit juice grew directly out of Prohibition's attempt to make bootleg liquor palatable. Millions of people who didn't like the taste of beer, wine, or hard liquors found cocktails irresistible.
The aim of the law is not to punish sins. |
JUSTICE OLIVER WENDELL HOLMES |
9. Prohibition made cigarette smoking a national habit. High on the evangelicals' hit list, second only to alcohol as a substance that had to be prohibited, was tobacco. In 1921, cigarettes were illegal in fourteen states, and anti-cigarette bills were pending in twenty-eight others. The prohibition of cigarettes, promoted by the very people who gave us the prohibition of alcohol, made cigarette smoking almost irresistible. As the experiment of Prohibition failed, the anti-cigarette laws fell. By 1930, they were legal almost everywhere; during Prohibition, the consumption had nearly tripled. Hollywood used cigarettes to indicate independence, sophistication, and glamour.
10. Prohibition prevented the treatment of drinking problems. It was stylish, fashionable, trendy, and daring to be drunk. No one had a drinking problem. ("I drink; I get drunk; I fall down. Where's the problem?") With alcohol illegal, there were no social norms for reasonable, moderate alcohol consumption against which to compare one's own drinking. The official social sanction (enforced by law) was complete sobriety. Anything less—from one drink per month to ten per day—made one a Wet. Anyone who suggested to a friend, "You may have a little problem here," sounded like one of the preachy blue noses whose moralizing started all the trouble in the first place.
No nation is drunken where wine is cheap. |
THOMAS JEFFERSON |
With the clearly immoderate act of Prohibition, all moderation was abandoned. The only "therapy" recommended by the Drys was jail and prayer. And how could people go for pastoral counseling for a possible drinking problem? People were thrown out of congregations for drinking only once. Imagine what might happen if one admitted to drinking enough times to cause a problem. Alcoholism, unrecognized and untreated, became an epidemic during Prohibition due to Prohibition.
Within a few years after Prohibition, some people began to realize that they had personal problems that involved drinking and, by the end of the 1930s, Alcoholics Anonymous was formed—the first of many organizations to point out that drinking for some people is the symptom of an illness, an illness that can be successfully treated.
11. Prohibition caused "immorality." Far from Prohibition leading to Great Moments in Morality, as the evangelicals had promised, it led directly to an unparalleled explosion of immorality—as immorality was defined by them. As speakeasies were unregulated, outlawed, underground, and co-educational, they tended to breed unregulated, outlawed, underground, and co-educational activities. Because the sexes mingled freely, the sexes tended to mingle freely. A great deal of the increase in unmarried sexual activity during the 1920s can be directly linked to the potent combination of alcohol and an atmosphere of illicit activity and abandon.
I have taken more out of alcohol than alcohol has taken out of me. |
SIR WINSTON CHURCHILL |
Prostitution also flourished—although professionals complained that some of these newly liberated women were destroying the business by giving it away. Drugs other than alcohol were used by people who never would have come into contact with them were it not for the permissive atmosphere of the speakeasies.
College, traditionally a center for higher learning, became, for some, the center for learning how to get higher. Alcohol paved the way for seeking "kicks" in other formerly forbidden activities. "Anything goes" became the slogan of an entire generation. Prohibition made the twenties roar.
All these developments, of course, were soundly denounced in lurid terms by the keepers of morality—but then, those were the things they said about alcohol, too.
12. Prohibition was phenomenally expensive. The exact cost of this thirteen-year experiment is difficult to estimate. Between law enforcement, courts, the operation of jails, and all the rest, some estimates top a billion dollars (and this is a billion dollars when a Ford factory worker—among the highest paid unskilled laborers—made only $5 a day(*FN)). In addition to this cost, let's not forget the taxes on alcohol the government lost because of Prohibition, and the profit denied honest business people and diverted into the pockets of organized crime. The artificially increased price of alcohol hit the poor and working classes hardest of all. It was a very expensive experiment.
[*FN Some Ford workers made more. Henry Ford, for example, made $264,000 per day in 1921, about $8.4 milllion in today's dollars.]
Prohibition had a handful of good effects: Fewer people listened to the ranting of self-appointed moralists; women took an important (albeit wobbly) step toward personal freedom; and lawmakers became slightly more hesitant to prohibit things—for a while.
We learn from history that we do not learn from history. |
GEORG WILHELM HEGEL |
The effects were, however, mostly negative. For good or for ill, there's hardly an American alive today whose life was not touched by Prohibition.
George Santayana warned, "Those who cannot remember the past are condemned to repeat it." If only we would remember the past as often as we remember to quote Santayana.
Alas, we have forgotten our recent past and are repeating it even now.
3.Organized crime in politics - Kennedy's assassination; a case study
Organized Crime in Politics
In his massive study, Organized Crime and American Power, British historian Michael Woodiwiss (2001) presents exhaustive evidence convincingly demonstrating the persistence of a close link between organized crime and politics from well before United States independence to the present time. While he offers no specific explanation, presumably because he is an historian and not a social scientist (his implicit explanation seems to boil down to a capitalist conspiracy), one important lesson from the U.S. experience is that such an historical pattern once established evidently cannot be broken. Woodiwiss, contrary to the conventional view, does not see the nineteenth-century “robber-barons” as having been transformed at all into “respectable” law-abiding businessmen. For him they are the antecedents of modern organized crime. From the Yazoo land fraud of the 1790s to the Savings and Loan scandals of the 1980s, "organized crime" in America has involved "respectable" people.
Even a landmark study of the reduction of organized crime's influence on major industries in New York City drew a blank regarding politics, with the authors admitting that such connections had never been examined (Jacobs et al., 1999: 127). Nevertheless, the New York study did hint at two further factors which might have made organized crime's incursions into politics tolerable,
A study of organized crime in other American cities, meanwhile, showed not only that what it called “the `triple alliance' of politicians, police, and organized crime” was still alive and well, but that the initiative in the relationship came from the politicians.
It was by no means a situation of organized crime “intruding into” politics, but of politicians reaching out to control and co-opt the criminals and their activities (Jenkins and Potter, 1987: 476-8).
Furthermore, the criminal-political nexus exists not only in America's major cities, which receive the lion's share of attention, but also on the national level. Perhaps it is because of the contingent nature of the relationships between politicians and organized crime figures that they are so difficult to focus on and to study. Nonetheless, as an investigation into U.S. national politicians and the International Brotherhood of Teamsters during the Reagan presidency put it, “Serious organized crime in American society is always political even though its most lurid manifestations are the private use of violence” (Block and Griffin, 1997: 1).
As compared to the United States, Mexico offers a more instructive case for thinking about the connection between organized crime and politics, as well as the transition to democracy. In Mexican politics, relations between politicians and organized criminals may be modeled according to which of the two is dominant, and which way influence flows.
Either the politicians are using the criminals and discarding them when no longer useful, or else the initiative comes from the criminal side so the politicians are being used for the criminals' protection and enrichment (Bailey and Godson, 2000: 3-6 and 15-21; Pimentel, 2000: 33-57). The latter, or "stage-evolutionary model," is the normal or more usual form of the relationship (Pimentel, 2000: 39-40 and 56-7; this, incidentally, ties in well with Jacobs et al., 1999).
Under the Institutional Revolutionary Party (PRI), Mexico's situation corresponded to the alternative, or "elite-exploitation,"
model of organized crime. This model features politicians' being able to control organized crime from the top, and to exploit it like a "cash cow"--a source of hard currency, investment and development funds, campaign financing, and personal enrichment.
A useful way to think about the impact of this on democracy is to say that the political-criminal nexus affects five aspects of government (Bailey and Godson, 2000: 8-9). These are: (1) monopoly of coercion; (2) administration of justice; (3) administrative capacity; (4) provision of minimum public goods; and (5) conflict management. Altogether, the five criteria would be have to be applied in assessing the effects of the political-criminal nexus on democracy, particularly in a country supposedly undergoing a transition to democracy, such as Mexico or Russia.
In other parts of the world, the relationship between politics and organized crime is quite variable, possibly reflecting cultural peculiarities. Colombia represents an extreme case of perpetual war between the legitimate authorities and drug lords. The war developed out of weakness of political institutions, was sustained by the economic benefits accruing to each side, and is being perpetuated by the failure of one to gain superiority over the other.
Hence, the impossibility now of distinguishing political violence from criminal, criminal acts from political, and rebel strongholds from regular government (Richani, 1997; Chernick, 1996; Rubio, 1998; Gutiérrez Sanín, 2000).
In Taiwan, from its time on the mainland the Kuomintang (KMT) inherited a tradition of corruption and links to organized crime, but the influence of the latter has been curtailed.8
Following the collapse of Yugoslavia, organized crime's emergence in Serbia was expedited by civil war and economic sanctions (Lane, 1992). The assassination of Prime Minister Zoran Djindjic in March 2003 only served to remind us of its continued presence (Globe andMail, 13-18 March 2003).
India, whence terms like "goon" and "thug" originate, has seen the criminalization of politics as a chronic and growing phenomenon, particularly in some northern states. The evidence is found in the election to state assemblies of MPs with criminal records, and in the apparent connections between party politicians and organized criminals. The linkages form due to parties' financial needs, as well as on account of the relatively high degree of state control of the economy (a legacy of India's experiments with socialism) (Hardgrave and Kochanek, 1999: 115-16, 225-7, and 342-6).
Japan's postwar politics have also been marked by the presence of organized crime groups in parties and movements, as well as by a substantial degree of acceptance by the authorities of the accompanying violence. Some of this is linked to the official suppression of Japanese nationalism by way of an underground reaction; some, a legacy of the wartime black market (Szymkowiak and Steinhoff, 1995). Membership in organized crime groups has declined from its peak in 1963, but the yakuza are still a well-entrenched feature of Japan's economy and society (Shigeru, 1998). Overall, openings for the entry of organized crime into the realm of politics are provided principally by the weakness of political institutions, as well as the cupidity of party politicians seeking and holding onto office, but the degree of penetration can also be controlled by those same politicians--with public support.
Political cultures that feature patron-clientelism, apparently, are more likely to host criminal-political connections. This may stem from the coincidence that organized crime groups are themselves arranged as associations of patrons and clients (Paoli, 1995, 2001a). That, of course, has certain advantages and disadvantages tied to the nature of the activities pursued by the criminal-political nexus in question.
Mafia and state power developed therefore in parallel, their relationship becoming complementary and collaborative rather than competitive. The mafiosi provided services for their political patrons, and obtained favours in return. This alliance (one of equals, it should be stressed, and not, strictly speaking, at the point of contact between the two bodies a relationship of patron-clientelism) was underlain by a system of values shared equally by the politicians and mafiosi.
The mafia's intrusion into politics, however, was not uniform across time and space, nor was it for inherent reasons stable. No single organizational formula was applicable to the Italian mafia groups. While Cosa Nostra in Sicily has been highly structured, the same is not been true in the other three provinces, and even within Sicily there have been variations (for the organizational structure of Sicily's Cosa Nostra in its heyday, see Jamieson, 1989: 3-4, and 2000: 5). Overall, the most appropriate designation for all the mafia as organizations is "consortia," which de-emphasizes hierarchy and coordinative leadership, and emphasizes organizational looseness. Mafia groups, of course, are more than merely economic enterprises; they are an intrinsic part of their society.9
Italian mafia groups have also experienced a great deal of change, particularly in the last half of the twentieth century. Hence, a static view of this (or any other) organized crime formation would not be accurate. In terms of organization, the more rigidly structured Cosa Nostra has mutated towards the "consortium” model of the `Ndrangheta; the Camora is not vertically structured at all. The long association between the Cosa Nostra and the Christian Democratic (DC) party has broken down; mafias now support various political parties. The culture of honour has faded; the pursuit of wealth and personal enrichment brings more prestige. The subculture once shared by politicians and
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mafiosi is dissolving. Having turned to illegal business, the mafiosi are not as dependent on politicians for favours. More critical for them is to seek reliable ways to launder their ill-gotten money. Through mutual need (for financial management and for protection, respectively) organized crime and financial crime cooperate (Paoli, 1995: 346-7 and 353-7).10 Whereas formerly mafiosi could get away with murder by influencing judges through their political patrons, the megatrials of the 1980s signified a major change in the relationship. Consorting with mafiosi became a liability for politicians; the mafiosi lost respect for the politicians and the “political class” as a whole. Far from being allies, the 1990s saw the killing of numerous politicians and judges by the mafiosi, which only deepened popular disgust with all of them. A further complication has been the appearance of Freemasonry as a mediator between the political and criminal worlds, which draws an extra veil of secrecy over the connections. Greatly weakened, but given the laws of social inertia, the Italian mafia, and the political-criminal nexus, both persist.
The mutuality of the mafia's relationship to politics in the Italian case has been modified, therefore, which again suggests that to view this connection—in any context—as unchanging is unwise. The criminal-political nexus is a living, evolving one. Sources of change, as suggested by the Italian experience, have been cultural, political, economic, generational, and international. International factors, specifically the role of the United States liberation forces, were responsible for drawing the mafia in to support the DC and for providing great opportunities in the black market in the 1940s, during and after the war. The granting of autonomy to the regions of Italy in 1946, not only solidified mafia support for the DC, but also gave the Sicilian Cosa Nostra new opportunities to benefit from governmental development programmes and funding. Italy's subsequent modernization, extending as it did even to the mezzogiorno, contributed to a change in values by which the mafia lost respect and status. New opportunities for enrichment have been opened up by the drug traffic, which not only altered relations between the mafiosi and politicians (they—mafiosi—were no longer so dependent on their politician friends for contacts and contracts). It also opened up divisions within the mafia, between those flaunting the new wealth and the more traditional “men of honour.” A new generation of mafioso—more willing to live and let live, as far as politicians are concerned, and not seeking either confrontation or collaboration—arose. The killing spree of the 1990s, in
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the wake of the maxi-trials begun in the previous decade, was judged a failure; indeed, it was more than that—no longer signifying strength but weakness. The collapse of communism removed the props from the DC and the Socialists, simultaneously wrecking their clientelistic links with mafia groups. The extraordinary wealth derived from the drug business led the mafia to seek alliances with financial criminals instead of, or at the very least in addition to, politicians. The two now had complementary needs for financial services (money laundering) and for protection (enforcement). Politicians lost respect in the eyes of the mafiosi by reason of the anti-mafia campaign, among other things. In any case, the adaptability of organized crime to changed circumstances should never be underestimated.
By its very nature, organized crime—because it is engaged in ongoing and systematic illegal activity—inevitably intrudes into the political realm. It originates as a complement to a weak or weakened state--whether that be in the United States (where the founding fathers bound the national executive with unbreakable bonds of checks and balances), in Japan emerging from World War Two (and General MacArthur being careful not to recreate its war-like state), or in newly-unified Italy in the nineteenth century. The connecting tissue is corruption (Vannucci, 1997; Della Porta and Mény, 1997). Organized crime latches onto, or is itself latched onto by, politicians in a clientelistic relationship, receiving protection from the law in exchange for votes or support or a cut of the proceeds (or all three). This is even more likely to happen within the context of a political culture that emphasizes reciprocity and kinship (real or symbolic) over formal, contractual relationships based on legality. Once established, the political-criminal nexus does not go away. It receives encouragement when the state has a significant part to play in the operation of the economy, as well as when certain activities (alcohol, tobacco, drugs, prostitution, trade in human organs) are prohibited or restricted. Either the politicians or the organized criminals may be in the dominant position, or there may be a standoff, as in Colombia. In any case, organized crime does not attempt to displace the state, even if it is at war with it. In this respect it is not the same as a terrorist group which does seek to take over political power (Bassiouni and Vetere, 1998: xl-xlii). It exists side-by-side with the state, in a relationship variously referred to as complementary, collusive, symbiotic, or parasitic: they are “two
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sovereignties” (Cretin, 1997: 159-62; Paoli, 1999: 15 and 20-1; Jamieson, 1994: 15, 2000: xxi; Vannucci, 1997: 51).
The Russian case, incidentally, appears to belong to the extreme end of the spectrum, where not only is corruption perceived to be excessive, but also where the connection between organized crime and politics is so tight that there is no longer any practical distinction between the two (Khokhriakov, 2002). They have become fused and are no longer “two sovereignties” but instead are one. The roles of politicians, businessmen, and organized criminals are becoming indistinguishable. Russia is therefore an exemplar for a new type of criminal-political nexus apparent in several small states (Moran, 2001: 385-6), the “criminal state.” Not everyone agrees with such an assessment. Naylor (1999: chap. 6), for example, dismisses out of hand any notion that Russia is becoming criminalized. He puts the post-Communist trauma down simply to greed and capitalism. Indeed, some studies of Soviet and Russian anti-corruption campaigns have concluded that such campaigns are as much about leadership infighting as they may be aimed at eradicating corruption per se (Holmes, 1993: 148-54, 210-11, and 220-31; Clark and Jos, 2000). But the degree of closeness of the criminal-political nexus is in any case a matter of empirical investigation, quite apart from what some outsiders may believe and what Russian politicians may be saying to rationalize their actions. Many scholars are deeply pessimistic about the effects of the criminalization of its politics on Russian democracy and economy.
Transnational Organized Crime
Since the end of the Cold War, and perhaps as a substitute for it, greater attention is being paid to global or transnational crime. Paralleling the globalization of the world's economy there has been an extension of links between criminal groups across national boundaries. Economic and political power are drifting away from governments into the hands of transnational business corporations and transnational organized crime (Shelley, 1995: 463-73; Strange, 1995: 305-7; Bassioiuni and Vetere, 1998: xxxi-xxxiii; Mittelman and Johnson, 1999; Williams and Vlasis, eds., 2001; Edwards and Gill, 2002). In brief, "technology and a world market in drugs and in money together have caused states to fail to protect society against crime and criminals” (Strange, 1995: 307). This new situation is a threat both to established democracies and to those being established.12 This recently-
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discovered danger is of interest now not only to law enforcement and security agencies, but to military planners as well (Turbiville, 1994; Turbiville et al., 1997). For purposes of the present paper its significance is that investigating domestic sources of organized crime must be augmented by taking into account the international aspect. Russia today, for example, is an exporter of organized crime (Shelley, 2002)13 as well as being extensively criminalized internally.14 Obviously, Russia is affected by, and is affecting, the phenomenon of transnational organized crime, although in some cases there is doubt as to whether the criminal activity in question is genuinely “organized” in the conventional sense of the term (Finckenauer, 2001; Paoli, 2001b; Berryman, 2000). There is particular concern regarding trafficking in illegal drugs, even as it affects the United States.15
Countering Organized Crime
Can the threat from organized crime--ultimately, criminalization of the economy and of the polity--be countered? One study of organized crime cases in the Netherlands suggests a positive, but complex and fairly undramatic, answer (Van Duyne, 1996-97). It requires abandoning certain notions: that organized crime has the objective of assuming political power; that organized crime has a strategy of investing its laundered money in the legitimate economy thus influencing its development; that organized crime instigates and initiates corruption; and that organized criminal groups are the alien "they" as opposed to "us." Measures that can be effective in holding organized crime in check are: (1) strict law enforcement, auditing procedures, and codes of conduct for lawyers; and (2) wide public expectations of probity in politicians--which requires an acknowledgement that "the seeds of corruption and organized crime are not situated 'outside' but inside the house of democracy” (Van Duyne, 1996-97: 233). Of course, they cannot be expected to eradicate it altogether.16 In addition, the policing of organized crime has to be reoriented to its anticipation and prevention, as well as targetting especially vulnerable sectors of the economy for particular attention. Obviously, an American-style "war on crime," with all its military hardware, is not the answer. For Russia, it may be altogether too late to consider measures to counter organized crime, but that is a story for another time.
Kennedy
What about those witnesses? Didn't everyone hear shots from the Grassy Knoll? What about the Tague wounding? Who was the "Umbrella Man?" Was the rifle recovered really a Mauser? Does "acoustic evidence" show a shot from the Grassy Knoll? Were the Three Tramps suspicious? How could Kennedy's head go "back and to the left?"
You've seen Kevin Costner give the conspiracy version of the Single Bullet theory. You know: Connally seated directly in front of Kennedy, at the same height, and facing straight ahead. Was that really what happened?
What sort of person was he? Did he really have "Top Secret" security clearance? Did he shoot at General Walker? Were there two Oswalds? If Oswald shot Kennedy, what was his motive? Was the man exhumed in 1981 really somebody besides Oswald?
Did Oswald really share an office with Guy Banister? Did Clay Shaw really use the alias "Clay Bertrand?" Why did Oliver Stone make a movie about the Shaw trial and not even mention Perry Raymond Russo? Did David Ferrie die a "mysterious death?" What about Jim Garrison and the Mafia?
Did the bullet that hit Kennedy in the back penetrate only an inch and fall out? Was Kennedy hit in the head by a bullet from in front? Are the autopsy photos and x-rays faked? Did all the doctors at Parkland Hospital believe that Kennedy was hit in the front of the neck, and if so, are their opinions decisive evidence that that is what happened? Was the back of Kennedy's head blown out? Are the autopsy photos faked?
Did you know that all the evidence in this case proven to be forged has been on the conspiracy side? One key piece originated with the KGB! Did you know that the "mysterious deaths" are virtually all not so "mysterious" when you look at them closely? Do you trust authors like Mark Lane to tell you the truth about what witnesses said?
The "lone nut" theory of the assassination is really the "two lone nuts" theory. What sort of person was Jack Ruby? A mobster? An intelligence agent? A small-time hustler? The sort of volatile character who might really have shot Oswald out of righteous anger?
We expect Hollywood movies to take some liberties with the historical record. But what do we think when Hollywood turns history on its head? Oliver Stone wants to overturn the verdict in the Clay Shaw trial. The jury found that District Attorney Jim Garrison had no case — so Stone invents a case on celluloid. Just how honest was Oliver Stone, Shaw's Hollywood prosecutor?
For some in the conspiracy crowd, John Kennedy was a liberal saint, who was going to implement policies that would bring America into a new Utopia. So, of course, a threatened Power Elite had to kill him. Was Kennedy the kind of left liberal who threatened established interests? Was he a hero of Civil Rights? Had he decided to pull out of Vietnam? Historian Eric Paddon dissects these claims in a series of essays based on his posts on the Internet.
Some notions about logic, probability and statistics necessarily underlie all discussion of "conspiracy" or "lone assassin." Does the lone assassination theory involve too many implausible "coincidences?" Are there a suspicious number of "connections" between various figures in the case? Is the Single Bullet Theory highly "improbable?"
It writings about the assassination, as in real-world criminal justice, witness testimony looms large. But just how reliable are the witnesses? How many witnesses are just flat out telling tall tales? How often are apparently sober and reliable witnesses just flat wrong?
A woman named Judyth Baker has come forward claiming to have been Oswald's adulterous lover in in summer of 1963, to have participated with him in a secret bioweapons program aimed at killing Castro, and to have inside knowledge of Oswald's "patsy" role in the assassination. It's a good story, and she got a chance to tell it on the History Channel in November 2003. But is it the truth?
What we think about the assassination is dependent on what we think about history, and about the behavior of government officials and bureaucrats. Was Kennedy a radical who threatened the status quo? Did top administration officials order a coverup of a conspiracy soon after the assassination? If the FBI and the CIA withhold documents, does this mean that they are protecting assassination conspirators?
This has long been the cry of the conspiracy theorists. Supposedly, the documents show that a conspiracy killed Kennedy. In fact, the government in the 1990s released a massive number of documents. The Assassination Records Review Board had a mandate to identify and oversee the release of documents in government hands, and in private hands.
Recording devices monitored the two radio channels used by the Dallas Police Department, and these recordings are a vivid "real time" account of the frenzy of activity that followed the shooting. Here are selected audio clips beginning a couple of minutes before the assassination and ending with the arrest of Oswald in the Texas Theatre.
Theory of conspiracy
Atty Frank Ragano - a brief history of conspiracy
New Year's Eve, 1959, Havana, Fidel Castro is about to converge on the city where for years the mob had its way with gambling.
The mob was paying off Castro's corrupt predecessor, President Batista.
Although all of the mob leaders fled Cuba during the Castro takeover, one mobster, Santo Trafficante, remained in Havana. Castro began executing hundreds of people aligned with the old regime. And, he targeted allies of Batista.
Trafficante was charged with participating in illegal activities under the old Batista regime
Frank Ragano, represented Trafficante (which in Spanish means one who traffics).
Ragano's Sicilian father ran a small store in Tampa. Won a Bronz Star for valor in Germany. The First Italian American to clerk for the Florida Supreme Court.
Sen. Estes Kefauver was using new subpoena powers to crack down ont he mob. One of his first targets was the Trafficante Crime Organization. Anti-Gambling Campaign targeted and run by a Tampa Sheriff Ed Blackburn. In 1954, Traficante and 34 others were charged in the gambling sweep.
Ragano was offered the job of representing Trafficante. Trafficante was originally convicted, but was released on a technicality. Ragano later admitted he "overlooked" a lot of activities of the Trafficante Crime Organization.
Ragano was one of the first attorneys to tell his mob clients to not hide their face in public, and to walk proudly in front of the media, projecting an image of innocence. Hiding your face projected an image of guilt as perceived by the public.
Nov. 1957, stumbled across a meeting of mob bosses in Appalachia, months after Albert Anastasia had been murdered by Carlo Gambino. Trafficante was among those who participated.
Ragano hid behind the words of FBI Director J. Edgar Hoover who lied to the public telling them there was no such thing as the Mafia.
In 1961, Ragano represented Teamster Boss Jimmy Hoffa, who was working with Trafficante to rape the Teamster Pension Fund.
Ragano was asked by Hoffa to convey a message to trafficante concerning John F. Kennedy that some believe involved a possible conspiracy to murder the President.
Although Hoover pretended the mob did not exist, President Kennedy's brother, Attorney General Robert Kennedy, targeted the mob and their illegal activities involving drugs and gambling. Before Kennedy became president, Kennedy had accused Hoffa of allowing communists into their union.
Ragano also represented Louisiana Crime Boss Carlo Marcello, a close Trafficante associate. In 1961, Robert Kennedy deported Marcello to Guatemala, without advance notice.
Ragano conveyed messages between Hoffa and the mobsters. In July, 1963, Hoffa told Ragano to tell Trafficante that something has to be done about the Kennedys. Ragano insists Hoffa said "Something has to be done right away. They've got to kill John Kennedy."
Ragano told Trafficante the message the next day in a New Orleans coffee shop.
Trafficante joined Ragano to celebrate the murder on November 23, 1963 the assassination of President Kennedy.
In 1963, the Federal Government targeted Ragano as being a member of the mob, and not just their attorney.
In 1971, Ragano was finally indicted of tax evasion. One of his partners was a Lucchese Crime Family member Sam Rizzo who testified against Ragano. Trafficante refused to help. He waas convicted, given 3 years probation and stripped of his law license.
In 1981, Ragano's tax conviction was overturned and his law license was reinstated.
Although trafficante had refused to help Ragano, in 1986, Trafficante was targeted in a new federal crackdown and he convinced Ragano to help.
Trafficante died in 1987 after telling Ragano that they had made a mistake in Killing John Kennedy, they should have killed Robert Kennedy.
In August 1990, Ragano was again convicted of tax evasion, and sentenced in 1993 to 10 months in a federal health center.
Ragano about the conspiracy
In his autobiography, Mob Lawyer (1994) (co-written with journalist Selwyn Raab) Ragano added that in July, 1963, he was once again sent to New Orleans by Hoffa to meet Santos Trafficante and Carlos Marcello concerning plans to kill President John F. Kennedy. When Kennedy was killed Hoffa apparently said to Ragano: "I told you could do it. I'll never forget what Carlos and Santos did for me." He added: "This means Bobby is out as Attorney General". Marcello later told Ragano: "When you see Jimmy (Hoffa), you tell him he owes me and he owes me big."
Ragano also told Dan E. Moldea of the Washington Post that the Garrison investigation of Clay Shaw, Guy Banister and David Ferrie was an attempt to divert public attention away from Carlos Marcello. According to Ragano "Garrison was shielding Marcello from being implicated in the Kennedy murder case," Ragano says.
Ragano also told the story of how Santos Trafficante remarked just four days before he died: "That Bobby (Kennedy) made life miserable for me and my friends... We shouldn't have killed John (Kennedy). We should have killed Bobby."
Overview: Lee Harvey Oswald - Assassin or Patsy?
Lee Harvey Oswald had a childhood which was no better nor worse than millions of other Americans. He was bright and eager to learn, despite a disrespect for educational systems and authorities. At age 16, after joining the Civil Air Patrol and meeting Captain David Ferrie, he suddenly made some public posturings as a pro-Communist, despite the fact that he tried to join the Marine Corps at this same time. Once a Marine, several odd and troubling items filled his military record. Despite prior-service statements indicating interest in Communist activities, Oswald was granted a security clearance and stationed at the Japanese base where super-secret spy flights were being launched. Later, the speed and ease of obtaining a hardship discharge and a United States passport raise questions regarding Oswald's possible relationship with U.S. intelligence. Various discrepancies in Oswald's military records - notations made for the same date but different locations, unaccounted for periods of time - support the idea that Oswald was given secret intelligence training. Oswald's military files were reported "routinely" destroyed and it may prove impossible to conclusively prove Oswald's intelligence connections.
Overview: Russians - Soviets and Solidarists
The fear of worldwide Communist revolution today has been discredited. However, this fear has been extremely strong among certain groups and cliques in America, particularly in the 1950s and 1960s. It was used to justify all sorts of intelligence skullduggery. It appears obvious to most assassination researchers that Oswald's visit to Russia was a planned intelligence operation. Oswald's suspicious manner of entering and leaving Russia reinforce the belief that he was an intelligence operative - as does the lavish lifestyle he enjoyed while living in Minsk. Then there is tantalizing - though unproven - connections between Oswald and the ill-fated U-2 spy plane incident. There is much to argue against Soviet intelligence involvement in the assassination. However, the same cannot be said for Oswald's involvement with non-Soviet intelligence work and the trail leads to the United States intelligence.
Overview: Cubans - Pro and Anti-Castro
After leading a successful revolution in Cuba, Fidel Castro angered many interests in the United States by freeing his island nation of Organized Crime and American business domination and turning to the Russians for help. Responding to urgings from these factions, Vice President Richard Nixon initiated and encouraged action against Cuba - resulting in the ill-fated Bay of Pigs Invasion. President Kennedy would not use American military force against Castro. CIA officials planning the invasion ignored Kennedy and went ahead with their plans. The invasion was launched on April 17, 1961 - less than three months after Kennedy took office - and proved an utter disaster. The invasion's failure was blamed on Kennedy's refusal to unleash military naval and air support. Everyone connected with the invasion - the anti-Castro Cubans, the CIA, the military and Organized Crime - was bitter toward the new President. Into this world of passionate anti-Castro Cubans, adventurous CIA agents and Mafia soldiers was injected the odd ex-Marine Lee Harvey Oswald. Oswald, while maintaining a posture as a pro-Castro Marxist, nevertheless was in continuous contact with several anti-Castro elements. And while it may never be positively determined exactly who Oswald was working for, it is safe to assume that his employers represented the anti-Castro Cubans and their CIA and Mob allies.
Overview: Mobsters - Organized Crime
Since its inception in the 1930s, organized crime or the national crime syndicate has gained an ever-increasing chokehold on the United States. Attorney General Robert Kennedy, backed by the President, waged war against Organized Crime. Every one of the major crime bosses - including the powerful Teamsters Union President Jimmy Hoffa - were reported to have issued threats against the Kennedys. What the Kennedys may not have known were the connections between the Mob and U.S. intelligence agencies. These connections dated all the way back to Lucky Luciano and World War II. Hoover's FBI had always taken a laissez faire attitude toward the syndicate, while the CIA actually had worked with crime figures in assassination plots. Many assassination researchers, including House Select Committee on Assassinations Chief Consul Blakey, today believe that organized crime was responsible for Kennedy's death.
Book of Facts: House Select Committee on Assassinations
The Committee was established in 1976 to look into the assassinations of President Kennedy and civil rights leader Martin Luther King, Jr. From the beginning, the Committee was hampered by the fact that most of its appointed members were young congressmen who had little power on Capitol Hill. An effort to include investigations of the murder of Robert F. Kennedy and the attempted murder of Alabama governor George Wallace was rejected.
The Committee went through a series of changes and turmoil among its members and staff, but in the end actually accomplished more than the Warren Commission had done in seeking the truth. The Committee concluded that there was a conspiracy to kill the president. It placed the blame on organized crime, a favorite target of its second chief counsel, G. Robert Blakey (who replaced Richard Sprague). Many believe Blakey had ties too close to the CIA to permit an objective investigation of that agency's potential involvement in the assassination. The Committee concluded that four shots were fired at the president, not the three the Warren Commission claimed. At least one Committee member, Congressman Christopher Dodd, said he believed the evidence indicated that three gunmen fired at the president. Many assassination researchers criticize the Committee's work. Its report, issued in January 1979, differed from the Warren Commission's findings. Without a doubt it left much undone, but it did take a small step toward finding the truth. Critics of both the Warren Commission and the House Select Committee wonder whether it is possible for a body representing the federal government to conduct an impartial investigation of an assassination in which agencies of that government appear to have played a role. See also ACOUSTICAL EVIDENCE; GONZALEZ, HENRY. High Treason
Book of Facts: Warren Commission
On November 29, 1963, President Lyndon B. Johnson issued Executive Order No. 11130, creating a commission to investigate the assassination of President Kennedy, the wounding of Governor John Connally, and the murder of Police Officer J. D. Tippit. Officially known as the President's Commission on the Assassination of President Kennedy, it quickly became referred to popularly as the Warren Commission, after its chairman, Earl Warren, chief justice of the United States Supreme Court. The Commission collected testimony from 552 individuals. Of these, 94 appeared before members of the Commission, 395 were questioned by Commission lawyers, and 63 supplied either affidavits or statements. Before the Commission's report, known as the Warren Report, was even published, critics charged that important witnesses whose information differed from the Commission's findings - that Lee Harvey Oswald alone killed Kennedy and that no conspiracy was involved in the assassination - were not called to testify, or their testimony was ignored or altered. Following publication of the Report, the Commission released twenty-six volumes containing the testimony, affidavits, and statements of witnesses as well as other related material. Many early Commission critics used the twenty-six volumes to build their cases against its findings.
Overview: Agents - The CIA and other intelligence agencies
There is little question that by the time of the Bay of Pigs invasion the Central Intelligence Agency was running out of control. It had gone far afield from the quiet, intelligence-gathering and coordinating agency envisioned when created in 1947 by President Truman. Documented CIA abuses included the overthrow of governments, secret mind-control experiments on unsuspecting victims and assassination plots. It is entirely possible that Lee Harvey Oswald may have played some role in an Agency operation. There can be little doubt that many persons in contact with Oswald also were in contact with the CIA. These contacts, plus the abundant evidence that Oswald was involved in intelligence work, raises serious questions about who may have been maneuvering Oswald in the fall of 1963. For all this, it seems highly unlikely that the CIA, as an organization, initiated the assassination of Kennedy. This, however, does not preclude the possibility that rouge CIA agents may have played roles in an assassination conspiracy which later compelled their superiors and peers to cover up for fear that such connections might become public.
Overview: The G Men - J. Edgar Hoover's FBI and the Secret Service
Anyone making a serious study of the JFK assassination must take a long hard look at the FBI and the Secret Service. The former - as we now know - monopolized the investigation of the tragedy while the latter failed to prevent it. The contacts between accused assassin Lee Harvey Oswald and the FBI are many and troubling. No less than seven FBI agents were associated with Lee Harvey Oswald during the year and a half between his return from Russia and the assassination. In 1964, there was even the serious allegation that Oswald was working for the Bureau at the time of the assassination - a charge which the FBI emphatically denied. While no unquestioned case for FBI involvement in the assassination can be made, there is now no doubt that the Bureau manipulated the subsequent investigation by suppressing and destroying evidence and by the intimidation of witnesses
Overview: Rednecks and Oilmen - Right-wing extremists and Texas Millionaires
Although his efforts were belated and timid, President Kennedy nevertheless did more to further the cause of civil rights in the United States than any of his predecessors. This human rights activity earned him the undying hatred of racist conservatives. One of the leaders of right-wing extremists in 1963 was Dallas-based Major General Edwin A. Walker. It appears that some people, such as Miami States Rights Party member Joseph Milteer, had foreknowledge of Kennedy's assassination. Milteer was taped by a police undercover agent accurately predicting Kennedy's death more than two weeks before the assassination. It is significant that one of the strongest allies of the Texas oilmen who loathed Kennedy was Vice President Lyndon Johnson. Johnson's ties with Herman Brown of Brown & Root Construction and with Texas oil interests are legend. Several people close to the assassination - notably Jack Ruby and former New Orleans District Attorney Jim Garrison - have accused Johnson of some role in an assassination conspiracy. As President and Commander-in-Chief, history will surely hold Lyndon Johnson responsible - if not for involvement in the assassination itself, at least for failing to uncover the conspiracy during his leadership.
4.Money laundering and other procedures leading to legalization of business.
Definitions:
In the US law it is the practice of engaging in finance/financial transactions in order to conceal the identity, source, and/or destination of illegally gained money, and is a main operation of the underground economy.
In the UK law the definition is wider. The act is defined as taking any action with property of any form which is either wholly or in part the proceeds of a crime that will disguise the fact that that property is the proceeds of a crime or obscure the beneficial ownership of said property.
In the past, the term "money laundering" was applied only to financial transactions related to organized crime. Today its definition is often expanded by government and international regulators such as the US Office of the Comptroller of the Currency to encompass any financial transaction which generates an asset or a value as the result of an illegal act, which may involve actions such as tax evasion or false accounting.
As a result, the illegal activity of money laundering is now recognized as potentially practiced by individuals, small and large businesses, corrupt officials, members of criminal organization organized crime such as drug dealers or the Mafia, and even corrupt states, through a complex business network of shell companies and trusts based in Offshore Financial Centre tax havens. "Smurfing" is an example of a money laundering technique.
The increasing complexity of financial crime and the increasing recognized value of so-called "financial intelligence information gathering intelligence" (FININT) in combating transnational crime and terrorism has led to an increased prominence of money laundering in political, economic, and legal debate.
SMURFING:
Background
Structuring includes the act of parceling large financial transactions into smaller transactions to avoid scrutiny by regulators or law enforcement. Structuring often appears in federal indictments related to money laundering, fraud, and other financial crimes. The term "smurfing" is derived from the image of the cartoon characters, The Smurfs, having a large group of many small entities. Miami-based lawyer Gregory Baldwin is said to have coined the term in the 1980s.
Typically each of the smaller transaction is below some statutory limit, that does not require a financial institution to file a report with a government agency. Criminal enterprises often employ several agents (smurfs) to make the transaction. However, even otherwise legal business practices can be considered a crime, as detailed recently by an article in Forbes magazine. The article reports that even if "the money is from a legal source, the government can charge you with a crime and/or demand you forfeit cash" if you apply the structuring method knowingly.
The term is also applied to activity associated with controlled substances such as pseudoephedrine. In this context the agent will make purchases of small, legal amounts from several drug and grocery stores intent to aggregate the lot for use in the illegal production of methamphetamine.
Money Laundring
the conversion or transfer of property, knowing that such property is derived from serious crime, for the purpose of concealing or disguising the illicit origin of the property or of assisting any person who is involved in committing such an offence or offences to evade the legal consequences of his action, and the concealment or disguise of the true nature, source, location, disposition, movement, rights with respect to, or ownership of property, knowing that such property is derived from serious crime.
Another definition is:
Money laundering is the process by which large amounts of illegally obtained money (from drug trafficking, terrorist activity or other serious crimes) is given the appearance of having originated from a legitimate source.
Money laundering, the metaphorical "cleaning of money" with regard to appearances in law, is the practice of engaging in specific financial transactions in order to conceal the identity, source and/or destination of money and is a main operation of underground economy
According to EU especially the Basilei directive and Financial Action Force on Money Laundering - FATF - money laundering concerns:
1.an exchange or trnasefer of any property values knowing of their illegal source
2.concealment of origins or source of any property values
3.acquirement or using of any property values if a person using them knows of their illegal sources
More: according to the EU law money landering concerns such an activity on the territory of a different country EU-member or on the territory of a non-EU member
United States practice
In the United States, the Bank Secrecy Act requires the filing of a currency transaction report (CTR) for transactions of US$10,000.01 or more. Financial institutions suspecting deposit structuring with intent to avoid the law are required to file a suspicious activity report.
Title 31 of the United States Code, section 5324, provides (in part):
No person shall, for the purpose of evading the reporting requirements of section 5313 (a) or 5325 or any regulation prescribed under any such section, the reporting or record keeping requirements imposed by any order issued under section 5326, or the record keeping requirements imposed by any regulation prescribed under section 21 of the Federal Deposit Insurance Act or section 123 of Public Law 91-508— [...] (3) structure or assist in structuring, or attempt to structure or assist in structuring, any transaction with one or more domestic financial institutions.
Section 5324 further provides that a violation of this provision may be punished by a fine or up to five years in prison, or both
HISTORY OF MONEY LAUDERING
Modern development
The act of "money laundering" was not invented during the Prohibition era in the United States, but many techniques were developed and refined then. Many methods were devised to disguise the origins of money generated by the sale of then-illegal alcoholic beverages. Following Al Capone's 1931 conviction for tax evasion, mobster Meyer Lansky transferred funds from Florida "carpet joints" to accounts overseas. After the 1934 Swiss Banking Act, which created the principle of bank secrecy, Meyer Lansky bought a Swiss bank to which he would transfer his illegal funds through a complex system of shell companies, holding companies, and offshore bank accounts.
The term "money laundering" does not derive, as is often said, from Al Capone having used laundromats to hide ill-gotten gains.
It was Meyer Lansky who perfected money laundering's older brother, "capital flight," transferring his funds to Switzerland and other offshore places. The first reference to the term "money laundering" itself actually appears during the Watergate scandal. US President Richard Nixon's "Committee to Re-elect the President" moved illegal campaign contributions to Mexico, then brought the money back through a company in Miami. It was Britain's The Guardian newspaper that coined the term, referring to the process as "laundering." (See Jeffrey Robinson's three books on money laundering, The Laundrymen, The Merger and The Sink.)
Procedure
If a person is making thousands of dollars in small change a week from a business (not unusual for a store owner) and wishes to deposit that money in a bank, it cannot be done without possibly drawing suspicion. In the United States, for example, cash transactions and deposits of more than a certain dollar amount ($10,000) are required to be reported as "significant cash transactions" to the Financial Crimes Enforcement Network FinCEN, along with any other suspicious financial activity which is identified as "suspicious activity reports." In other jurisdictions suspicion-based requirements are placed on financial services employees and firms to report suspicious activity to the authorities. Methods to conceal the source are therefore required.
Other methods
Irregular funding
One method of keeping this small change private would be for an individual to give money to an intermediary who is already legitimately taking in large amounts of cash. The intermediary would then deposit that money into an account, take a premium, and write a cheque to the individual. Thus, the individual draws no attention to himself, and can deposit his cheque into a bank account without drawing suspicion. This works well for one-off transactions, but if it occurs on a regular basis then the cheque deposits themselves will form a paper trail and could raise suspicion.
Captive business
Another method involves establishing a business whose cash inflow cannot be monitored, and funneling the small change into this business and paying taxes on it. All bank employees however are trained to be constantly on the lookout for any transactions which appear to be an attempt to get around the currency reporting requirements. Such shell companies should deal directly with the public, perform some service-related activity as opposed to providing physical goods, and reasonably accept cash as a matter of business. Dealing directly with the public ensures plausible anonymity of source.
An example of a legitimate business displaying plausible anonymity of source would be a hairstylist. Since it would be unreasonable for them to keep track of the identity of their customers, a record of their transaction amounts must be ostensibly accepted as prima facie evidence of actual financial activity. Service-related businesses have the advantage of anonymity of resources. A business that sells computers has to account for where it actually got the computers, whereas a plumbing company merely has to account for labor, which can be falsified. Reasonably accepting cash means the business must regularly perform services that total less than $500 on average, since above that amount most people pay with a check, credit card, or other traceable payment method. The company should actually function on a legitimate level. In the plumbing company example, it is perfectly reasonable for a lot of the business to involve only labour no parts, and for some business to be paid for in cash, but it is unreasonable for all of their business to involve no parts and only cash payment. Therefore the legitimate business will generate a legitimate level of parts usage, as well as enough traceable transactions to mask the illegitimate ones.
Money laundering cases are widespread and have even impacted NASA. From 1992 to 1996 a 9 agency Federal Task Force investigation led by NASA's Office of Inspector General investigated Omniplan Corporation of Houston and California, in what would become the largest count indictment and conviction in NASA history, with the owner of Omniplan, Ralph Montijo, being convicted of 179 felonies in his multi-million dollar embezzlement scheme. Five of his companies were also convicted of felonies, they were, Omniplan, Papa Primo's of Texas, Papa Primo's of Arizona, Omnipoint Production Services and Mercury Trust. These five companies, together with two unincorporated companies, Space Industries Leasing and Space Industries Properties were ordered liquidated. Each embezzlement count was associated with a corresponding money laundering count which resulted in dozens of convictions for money laundering. In a New York Times story NASA Office of Inspector General Senior Special Agent Joseph Gutheinz, who led the Omniplan task force investigation, was quoted as saying: "We didn't get any pizzas, but we got the bills", referring to the fact that some of the alleged mischarging to the NASA contract also involved costs associated with two of Ralph Montijo's pizza companies, Papa Primo's of Texas, and Papa Primo's of Arizona . ".
Corrupt politicians and lobbyists also launder money by setting up personal non-profits to move money between trusted organizations, so that donations from inappropriate sources may be illegally used for personal gain.
LA COSA NOSTRA AND MONEY LAUNDERING PROCEDURE
1.The mafia economy
According to professor Mario Centorrino there are 3 phases of mafia's economy:
a.parasitical phase a source of income is usually made by criminal activity like extortions
b.plundering phase control over illegal markets and dominant position is gained through fighting with competitive organizations
c.phase of symbiosis throug which mafia gaines a “business”status entering legal markets
Sometimes changing a phase means lossing the one that preceded, more often entering the nex phase does not mean abandonment the one that preceeded.
According to Enzo Fanto distinguishes 3 phases of capital accumulation in mafia's activity:
1.profits through different criminal activity
2.a.allocations of some profits to maintain criminal atructure of the organization and money investment in some new prfitable activities
b.money laundering
3.re-investment of clean money onto a legal economy gaining the phase of full integrity with legal market and financial system.
How big is the problem of Money Laundering?
Estimates of the size of the money laundering problem totals more than $500 billion annually world - wide. This is a staggering amount and detrimental by any calculation to the financial systems involved.
Clearly the problem is enormous. It is also clear that money laundering extends far beyond hiding drug profits. In the UK this is evidenced in the legislation that has been enacted to counter this crime. For example, confiscation and money laundering provisions are contained in the Drug Trafficking Offences Act 1986 (DTOA), in the Criminal Justice Act 1988 and the Criminal Justice (International Co-operation) Act 1990. These provisions focus particularly on drug trafficking.
However, the Criminal Justice Act 1993 makes the laundering of the proceeds of non-drug trafficking crimes an offence for the first time. It was not until the enactment of the Criminal Justice (Consolidation) (Scotland) Act 1995 and the Proceeds of Crime (Scotland) Act 1995 (both came into effect from 1-4-96) that Scotland came into line with England regarding the extension of money laundering to cover all crime proceeds.
THE MONEY LAUNDERING PROCESS
Money laundering is not a single act but is in fact a process that is accomplished in three basic steps. These steps can be taken at the same time in the course of a single transaction, but they can also appear in well separable forms one by one as well. The steps are:-
The Money Laundering Procedures
There are also common factors regarding the wide range of methods used by money launderers when they attempt to launder their criminal proceeds. Three common factors identified in laundering operations are;
Stages of Process
i) PLACEMENT
This is the first stage in the washing cycle. Money laundering is a "cash-intensive" business, generating vast amounts of cash from illegal activities (for example, street dealing of drugs where payment takes the form of cash in small denominations). The monies are placed into the financial system or retail economy or are smuggled out of the country. The aims of the launderer are to remove the cash from the location of acquisition so as to avoid detection from the authorities and to then transform it into other asset forms; for example: travellers cheques, postal orders, etc. (more details follow).
ii)LAYERING
In the course of layering, there is the first attempt at concealment or disguise of the source of the ownership of the funds by creating complex layers of financial transactions designed to disguise the audit trail and provide anonymity. The purpose of layering is to disassociate the illegal monies from the source of the crime by purposely creating a complex web of financial transactions aimed at concealing any audit trail as well as the source and ownership of funds.
Typically, layers are created by moving monies in and out of the offshore bank accounts of bearer share shell companies through electronic funds' transfer (EFT). Given that there are over 500,000 wire transfers - representing in excess of $1 trillion - electronically circling the globe daily, most of which is legitimate, there isn't enough information disclosed on any single wire transfer to know how clean or dirty the money is, therefore providing an excellent way for launderers to move their dirty money. Other forms used by launderers are complex dealings with stock, commodity and futures brokers. Given the sheer volume of daily transactions, and the high degree of anonymity available, the chances of transactions being traced is insignificant.
iii)INTEGRATION
The final stage in the process. It is this stage at which the money is integrated into the legitimate economic and financial system and is assimilated with all other assets in the system. Integration of the "cleaned" money into the economy is accomplished by the launderer making it appear to have been legally earned. By this stage, it is exceedingly difficult to distinguish legal and illegal wealth.
Methods popular to money launderers at this stage of the game are:
Money Laundering Methods
How the basic steps mentioned in the Stages of The Process are used depends on the available laundering mechanisms and the requirements of the criminal organisations. The table below provides some typical examples.
Placement |
Layering |
Integration |
Cash paid into bank (sometimes with staff complicity or mixed with proceeds of legitimate business). |
Wire transfers abroad (often using shell companies or funds disguised as proceeds of legitimate business). |
False loan repayments or forged invoices used as cover for laundered money. |
Cash exported. |
Cash deposited in overseas banking system. |
Complex web of transfers (both domestic and international) makes tracing original source of funds virtually impossible. |
Cash used to buy high value goods, property or business assets. |
Resale of goods/assets. |
Income from property or legitimate business assets appears "clean". |
Placement
Friendly dealer agent
|
Depositis on banking account
film tapes Rent a Car etc.. |
Ficticious
income
Cash - derived from drug trafficing |
|
Casino |
The purchase of a company/firm
Family business -
For instance laundry |
Fictious income
Layering
Fictious company in tax paradise like Luxemburg or Jersey
|
Fictious invoice
implementation
Bank transfer
in bank's headquarters |
r
Bank transfer
|
Bank transfer
Fictious
loan
F
Integration
Real estates investment
Exchequer company's bill purchase
Banking account on a real company
|
Financial deposits
International activity - Money Laundering and its complexity
The increasing complexity of financial crime, the increasing recognised value of so-called "financial intelligence" (FININT) in combating transnational crime and terrorism, and the speculated impact of capital extracted from the legitimate economy has led to an increased prominence of money laundering in political, economic and legal debate. In many jurisdictions, money laundering is seen as an "activity based" offense.
Following Al Capone's 1931 conviction for tax evasion, mobster Meyer Lansky transferred funds from Florida "carpet joints" (small casinos) to accounts overseas. After the 1934 Swiss Banking Act which created the principle of bank secrecy, Meyer Lansky bought a Swiss bank where he would transfer his illegal funds through a complex system of shell companies, holding companies and offshore accounts .
The term of "money laundering" itself does not derive, as is often said, from the story that Al Capone used laundromats to hide ill-gotten gains. It was Meyer Lansky who perfected money laundering's older brother, "capital flight", transferring his funds to Switzerland and other offshore places. The first reference to the term "money laundering" itself actually appears during the Watergate scandal. US President Richard Nixon's "Committee to Re-elect the President" moved illegal campaign contributions to Mexico, then brought the money back through a company in Miami. It was Britain's Guardian newspaper that coined the term, referring to the process as "laundering."
International initiatives against money laundering
The 1980s witnessed the international trend for the criminalization of money laundering as a discrete crime. The US and the UK have done so in 1986, and the 1988 Vienna Convention has required State Parties to introduce this crime in their domestic legal systems. In 1989, the FATF was created. Its first report, issued in 1990, recommended the criminalization of money laundering. In 1991, the European Union required its Member States to 'prohibit' the laundering of funds derived from drug offences; the original Directive was revised in 2001 and replaced by another in 2005.
September 11, 2001 and the international response to the underground economy
After September 11, 2001, money laundering become a major concern of the US Bush administration's war on terror, although critics argue that it has become less and less an important matter for the White House. Based in Luxembourg, Clearstream a clearing house or "a bank of banks" which practice "financial clearing", centralizing debit and credit operations for hundreds of banks, has been accused of being a major operator of the underground economy via a system of un-published accounts; Bahrain International Bank, owned by Osama bin Laden, would have profited from these transfer facilities. The scandal prompted André Lussi, Clearstream CEO, to resign on December 31, 2001; several judicial investigations were opened; and the European Commission was interpelled by Members of the European Parliament (MEPs) Harlem Désir, Glyn Ford and Francis Wurtz, who asked the Commission to investigate the accusations and to ensure that the 10 June 1990 directive (91/308 CE) on control of financial establishment was applied in all member states, including Luxembourg, in an effective way.
The international response to the underground economy has been co-ordinated by the Financial Action Task Force on Money Laundering ("FATF", also known by its French acronym of "GAFI"), whose original 40 principles form the basis of most international responses to money laundering activity. A further 8 principles, designed to counteract funding to terrorist rganisations, were added on June 30, 2003 in response to the September 11, 2001, with another added 22 October 2004, to form what are now known as the "40 + 9" principles of anti-money laundering and counter-terrorism funding (AML/CTF). Compliance with, or a movement towards compliance with, these principles is now seen as a requirement of an internationally active bank r other financial service entity.
Several FATF-style regional bodies exist, such as the Asia/Pacific Group on Money Laundering.
LEGISLATION
Many jurisdictions adopt a list of specific predicate crimes for money laundering prosecutions as a "self launderer" the UK has an "all-crimes" regime. In addition, Anti-money laundering AML/CFT laws typically have other offences such as "tipping off," "willful blindness," not reporting suspicious activity, and conscious facilitation of a money launderer/terrorist financing terrorist financier to move his/her monies.
UK legislation
Money laundering legislation in the UK is governed by three pieces of primary legislation:-
Secondary Regulation is provided by the Money Laundering Regulations 2003 and 2007.
Professional guidance (which is submitted to and approved by the UK Treasury) is provided by industry groups including the Joint Money Laundering Steering Group and the Law Society.
In the UK "money laundering" need not involve money (it relates to assets of any kind, both tangible and intangible, and to the avoidance of a liability) and need not involve laundering either a thief's possession of the assets he himself stole is included. There is no lower limit to what has to be reported - a suspicious transaction involving a single £5 note may be required to be reported. All persons not just financial services employees and firms are technically required to report, and obtain consent for, their own involvement in crime or suspicious activities involving money or assets of any kind. So in the UK a thief who steals a vest from a clothes store commits a "money laundering" offence because he has possession of an asset derived from crime. He is technically required to seek consent from law enforcement for his continued possession of the vest if he is to avoid risk of prosecution for "money laundering."
The UK legislation also creates a money laundering offence where a person enters into, or becomes concerned in, an arrangement which facilitates by whatever mean the acquisition, retention, use, or control of criminal property by another person. This has impacted upon lawyers and other professional advisers in the UK who act for a client whom they suspect may possess criminal property of any kind.
Because the UK legislation is wide-ranging, the UK FIU authority, the Serious Organised Crime Agency, receives a large volume of suspicious activity reports (SARs) - in 2005 just under 200,000 SARs were received. The number of SARs received appears to be growing by almost 50% each year.
The UK legislation was relaxed slightly in 2005 to allow banks and financial institutions to proceed with low value transactions involving suspected criminal property without requiring specific consent for every transaction but the reporting of all transactions is still required.
US legislation
The Bank Secrecy Act of 1970 requires banks to report cash transactions of $10,000.01 or more. The Money Laundering Control Act of 1986 further defined money laundering as a federal crime. The USA PATRIOT Act of 2001 expanded the scope of prior laws to more types of financial institutions, added a focus on terrorist financing, and specified that financial institutions take specific actions to "know your customer".
In the United States, Federal law provides (in part): "Whoever ... knowing[ly] ... conducts or attempts to conduct ... a financial transaction which in fact involves the proceeds of specified unlawful activity ... with the intent to promote the carrying on of specified unlawful activity ... shall be sentenced to a fine of not more than $500,000 or twice the value of the property involved in the transaction, whichever is greater, or imprisonment for not more than twenty years, or both.
While money laundering typically involves the flow of "dirty money" (criminal proceeds) into a "clean" bank account or negotiable instrument, terrorist financing frequently involves the reverse flow: apparently clean funds converted to "dirty" purposes. A hawala may launder drug proceeds and help fund a terrorist, netting the incoming and outgoing funds with only occasional small net settlement transactions.
Jurisprudence
The Supreme Court of the United States on June 2, 2008, rendered 2 judgments in favor of defendants, narrowing the application of the federal money-laundering statute.
First, in a 9-0 decision, Justice Clarence Thomas reversed Acuna, Mexico's Humberto Cuellar's conviction and ruled that "hiding $81,000 in cash under the floorboard of a car and driving toward Mexico is not enough to prove the driver was guilty of money laundering; instead, prosecutors must also prove the driver was traveling to Mexico for the purpose of hiding the true source of the funds." The Court further ruled "that federal prosecutors have gone too far in their use of money laundering charges to combat drug traffickers and organized crime; that money laundering charges under the Money Laundering Control Act of 1986, Sec. 18 U. S. C. § 1956(a)(2)(B)(i) apply only to profits of an illegal gambling ring and cannot be used when the only evidence of a possible crime is when a courier headed to Texas-Mexico border with $ 81,000 in cash proceeds of a marijuana transaction; it cannot be proven merely by showing that the funds were concealed in a secret compartment of a Volkswagen Beetlecar; instead, prosecutors must show that the purpose of transporting funds in a money laundering case was to conceal their ownership, source or control; the secrecy must be part of a larger “design” to disguise the source or nature of the money."
Second, in a 5 to 4 ruling, Justice Antonin Scalia reversed Efrain Santos of Indiana and Benedicto Diaz's convictions for money laundering based on cash from an illegal lottery. Scalia ruled that the law referred to the "proceeds of some form of unlawful activity; paying off gambling winners and compensating employees who collect the bets don't qualify as money laundering; the word “proceeds” in the federal money-laundering statute, 18 U. S. C. §1956,and §1956(a)(1)(A)(i) and§1956(h), applies only to transactions involving criminal profits, not criminal receipts; those are expenses, and prosecutors must show that profits were used to promote the illegal activity." Congress enacted the 1986 statute after the President's Commission on Organized Crime stressed the problem of "washing" criminal proceeds through overseas bank accounts and legitimate businesses. It imposes a 20-year maximum prison term .
*****************************************************
The Old Los Angeles/Hollywood Mafia
"F-Troop"
(1930s - 1960s)
Actress Lana Turner
Actress Lana Turner, stared with Robert Taylor, in "Johnny Eager," Hollywood tale of the mafia that marked the beginning of her own involvement with a real life mobster, Johnny Stompenado, a crew member for the Hollywood mob organization headed then by Mickey Cohen. Stompenado had confronted several of Turner's screen co-stars, including a celebrated tiff with Sean Connery. Stompenado was killed by Turner's daughter, who stabbed the mobster in the stomach several times. Stompenado had bled to death.
Mickey Cohen
Cohen himself had begun his mafia career as a thug for Vegas boss Ben "Bugsy" Siegel before moving to Hollywood. Cohen, a former ex-prize fighter, inherited Siegel's racing interests and operated a small haberdashery in Los Angeles that served as a front for a book making enterprise.
Cohen was eventually arrested and charged with tax evasion, and sentenced to 15 years imprisonment.
Cohen escaped numerous mob hits in the 40s and 50s. Always high profile, he dressed lavishly and flaunted his money and friendships. Much of his image came from the Hollywood movie houses that portrayed the mafia bravo in films of the era.
Jack Dragna
The west coast representative of the New York mob, who frequently fought with Cohen and was behind several attempts on Cohen's life, was Jack Dragna. Dragna liked to call himself the "Al Capone of Los Angeles." The Dragna mafia family, jokingly referred to by the FBI as "F-Troop," included members of his personal family, Louis, Tom, Frank and Paul Dragna.
Johnn Roselli
Dragna's organization incuded Johnny Roselli, who fled to Los Angeles after jumping bail on a federal narcotics arrest in 1921. Roselli worked with Dragna, extorting the film industry until his ocnviction in 1944. Sentenced to 10 years, he only served three. After Dragna's death in 1957, Roselli became the West Coast boss.
Gay Mafia
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The Gay Mafia or Velvet Mafia is a term for a supposed group of powerful gay people, usually men, who use their influence to further their own goals and those of other gays, while excluding or actively working against non-gay people.[1] It has been described as a conspiracy theory similar to that which supposed that Jews were a "a diabolical group that was consolidating power everywhere from the banking industry to Hollywood."[2] The "Gay Mafia" and "Velvet Mafia" are typically associated with the upper eschelons of the fashion and entertainment industries, and the terms are also used humorously by gay people themselves..
Contents [hide] |
[edit] Origin of the term
The term "Velvet Mafia" was first used by author Stephen Gaines in the 1970s, to describe the influential gay crowd that gathered at Studio 54. This "mafia" included Calvin Klein, Andy Warhol, Jann Wenner among others. The term was tongue-in-cheek, describing a "powerful social clique, not some truly devious alliance ruling either an industry or our politics."[3]
[edit] The Michael Ovitz scandal
Gradually, "velvet" came to be replaced with "gay". The term may have gained wider social prominence after it was used in a Spy magazine article 1995 and became notorious after an interview with one-time Hollywood talent agent Michael Ovitz in Vanity Fair in 2002 in which Ovitz claimed that an organized group of gay men was singling him out to ensure that he would "never [work] in [Hollywood] again".
Ovitz who, according to some, had a reputation for being homophobic during the height of his career in the 1980s and 1990s, claimed that DreamWorks SKG co-founder David Geffen, former New York Times reporter Bernard Weintraub, various former employees of Ovitz at the Creative Artists Agency such as CAA co-founder and Universal Studios President Ronald Meyer, and former Disney President Michael Eisner, among others, were part of a powerful group that conspired to end his career.
Some of the men named have not publicly come out, and indeed Ovitz himself has stated that "not all of them are gay", [4] so it is uncertain whether they are gay or not. Nevertheless, it has been pointed out that while powerful gay men in the entertainment industry may constitute a powerful social network, they have historically shown little loyalty to the larger gay community, in many cases preferring to remain closeted.
[edit] The Velvet Mafia in popular culture
An episode of television sit-com Will & Grace revolved around the Gay Mafia, with singer Elton John as its boss. Details Magazine subsequently ran a story on the Gay Mafia in which it humorously claimed that Max Mutchnik, co-creator of Will & Grace, was a "gay godfather-on-the-make." The article also identifies several other "pink power brokers," including GLAAD (Gay & Lesbian Alliance Against Defamation) -entertainment director Scott Seomin.[5]
Robin Williams also referenced the Gay Mafia in his Live on Broadway special, referring to it as the "Mauve Hand", and portraying a gay Godfather as Marlon Brando, quipping "Does this pistol make my ass look big?"
In the emmy award winning episode of The Simpsons entitled Three Gays of the Condo Homer Simpson refers to his two gay roommates as the "Velvet Mafia" to his wife Marge when they make him margaritas and his subsequent drunkenness causes him to be late for the reconciliation dinner planned by his wife.
A big-budget two-parter gay porn title from Falcon Studios staring Brent Corrigan is titled The Velvet Mafia.
An ezine founded in 2001 that features alternative literary queer fiction and erotica from today's hottest new writers, edited by Sean Meriwether. Velvet Mafia: Dangerous Queer Fiction
The Gay Mafia in Hollywood
First it was the increasingly unhinged Jerry Falwell blaming gays for bringing on the Sept. 11 attacks. Then it was the increasingly despotic Vatican blaming gays for its own ugly pedophile scandal. Now we have the onetime Hollywood superagent Mike Ovitz, in a much-reported-on interview in Vanity Fair, blaming gays-"a gay mafia" specifically-for sabotaging his career.
And according to the breathless press coverage of Ovitz's remarks, everyone in Hollywood and the media is absolutely shocked that Ovitz suggested the existence of this cabal and claimed that he was brought down by it. Both the New York Post and Daily Variety quoted Hollywood titan Barry Diller, one of those whom Ovitz includes in the gay mafia, who told Vanity Fair interviewer Bryan Burrough, "I'm stunned. I'm stunned." (He couldn't have been half as stunned as we were when he married Diane von Furstenberg-but that's another story.) Daily Variety termed the interview "a psychotic episode" on Ovitz's part.
The New York Times offered a list of people whom it said Ovitz included in the gay mafia, and then noted that "not all" of them are gay-without telling us which ones are gay and which are not. (Imagine if I offered a list of names and said, "Only some of these people are straight." You better believe they'd have a name for that.)
The Times then gave us this tantalizing detail: "Many of Mr. Ovitz's more outlandish statements about those he considers enemies did not make the final article, Mr. Burrough said. `There were questions of taste, privacy and sexuality that I just didn't think were appropriate,' he said." Oh, you tease!
The shock and bewilderment among both journalists and Hollywood's liberals is pretty silly-not to mention a bit defensive and a tad dishonest. While Ovitz's statements certainly warranted coverage, they weren't that shocking. We could have done with less of the titillation, professed horror and hand-wringing from journalists and their interview subjects, and with more acknowledgement of the fact that there most certainly is a band of powerful gay men in Hollywood, as well as frank discussion about what they represent-and, more importantly, what they don't. Nikki Finke in LA Weekly got it right last week, noting that Vanity Fair threw the salacious quotes onto the griddle but "didn't bother to challenge any of it." Much of the press coverage of the Vanity Fair story followed suit, floating the irresistible notion of a sinister gay mafia, expressing bewilderment and dismay that someone had pointed to it-and then dropping the ball.
Truth is, many gay men will tell you that there most certainly is a Hollywood/media gay mafia-using that term or its synonym, "the velvet mafia"-whether or not they are members themselves. It's made up of men such as DreamWorks cochair David Geffen and Rolling Stone publisher Jann Wenner, plus many more well-known and lesser-known individuals. They are men of a certain generation and status who travel together, throw swanky parties and introduce young beautiful things to one another. In other words, it's no different from the straight male mafia in Hollywood, where the casting couch for actresses is practically an institution.
"It's a social thing," says David Ehrenstein, author of Open Secret: Gay Hollywood 1928-1998 (William Morrow, 1998). "That's really all." Sure, it can help you in your career, just as networking on other social scenes can, particularly if you're an actor who needs a break, or if you're an agent who needs five minutes with a certain producer or whatever.
But the notion that Ovitz seemed to be suggesting, that this gay mafia is consolidating power among its members and cutting out and destroying nonmembers-such as himself-presumably so that it can then maintain a stranglehold and promote only its own kind, is downright laughable. It's not only akin to every conspiracy theory we've heard to date about Jews in Hollywood and beyond; more significantly, Hollywood's gay moguls, often to the chagrin of gay activists, have always had little allegiance to their own kind. Many are closeted, or have been in the past for many years. Like other powerbrokers in Hollywood, they're mostly out for themselves and will help anyone-gay, straight, bi, pansexual, neutered, hermaphrodite, whatever-who can help them to maintain their grip. The fact that some are open about their sexual orientation today and are contributing to the causes of gay rights or AIDS research is often the product of years of criticism and public protests by AIDS activists and gay activists. And still, many have little loyalty to the gay community-let alone are they garnering power on behalf of the rest of us.
Ovitz thus was implicitly ascribing an unlikely conspiracy to Hollywood's gay powerbrokers, attempting to deflect from his own failings, dredging up every last bit of that homophobia for which he's long been known. But for media people to profess shock and horror at the notion of such a powerful social network, and at the thought that someone might finger it-rightly or wrongly-is disingenuous at best, liberal pandering at worst.
Another reason that it shouldn't surprise anyone that Ovitz is blaming gays is the same reason that Falwell and the Vatican have blamed gays: In times of high anxiety, when a lot of straight men feel their masculinity (read: power) threatened, homosexuals become a favorite target. That's particularly true when they are in desperation mode, seeing their reputations sinking fast. Falwell is so nutty these days that even the most rabid among the religious right see him as an embarrassment, and perhaps he knows that. The Catholic Church is imploding, and though I'm not ready to say it's on its last gasp, it's certainly safe to say it's not on an upward trajectory.
Ovitz, recently forced to sell his agency for peanuts, watched his power dwindle to nothing over the years as others around him rose. High anxiety produces odd results indeed. Even the ailing New York Post, the tabloid that loses money by the minute, has gone back to a bizarre 1950s narrative on gays as it frantically attempts to whip up circulation-outdoing even its own homophobic reputation. A few weeks ago an item on "Page Six" mentioned "a swishy source," a retrograde code word for homosexual harkening back to J. Edgar Hoover's day! And last week, in reporting on gay pop star George Michael's controversial new video-in which British Prime Minister Tony Blair is portrayed as George W. Bush's lap dog-the paper called Michael a "washed up pervert."
The only thing washed up, however, is these zany, desperate McCarthy-era smear tactics against gays, whether coming from the Catholic Church, a one-time Hollywood titan or a New York tabloid, while more and more of the public seems inclined to dismiss them. And it would be nice if the rest of the media could actually explain that and more, rather than express shock and disdain while floating the smears further.
'Gay Mafia' Takes Control of Hollywood
by Paul Richert
If you're wondering why homosexuals have skyrocketed in recent years to join blacks and feminists at the top of liberalism's hallowed list of "minority groups" entitled to special rights and privileges, look no further than Hollywood --- Tinseltown is controlled these days by the "Gay Mafia."
The Gay Mafia is dominated by three individuals --- Sandy Geffen, Barry Diller, and Sandy Gallin. Geffen is a billionaire mogul who has recently joined forces with Steven Spielberg and Jeffrey Katzenberg to start "Dreamworks," a new studio which may well come to surpass all the other studios, given the resources and clout of its partners.
An expose of the Gay Mafia in the May/June issue of Spy magazine by Mark Ebner states that Geffen "can end a career with a phone call."
Geffen "married" Bob Brassle, a Warner Bros. vice president, at an est outing, in a ceremony replete with wedding bands. But Geffen is known for sleeping with countless male Hollywood executives and actors.
Diller is another superrich Hollywood executive. Ebner calls Diller the "smartest don in the Mob," noting that he has made "gods" out of those loyal to him --- people like Michael Eisner, Katzenberg, Peter Chernin, Sherry Lansing, and Dawn Steel, among many others. Although Diller still refuses to publicly acknowledge his homosexuality, according to Ebner he was known for cruising the dorms at UCLA and holding homosexual parties.
Gallin is a 54-year-old agent, manager and TV producer. According to Ebner, Gallin has had more plastic surgery than Michael Jackson, in an effort to perpetually look like a 30-year-old.
Beyond the three "dons" of the Gay Mafia, there are of course many film executives, agents, and actors --- and the mafia acts in concert to protect each other and their images. Agent Steve Dontanville was sued by a man for sexual harassment, but the mafia has kept the story hushed up. Another agent, Scott Zimmerman, was caught having sex with his male personal trainer in his office at the same time he was divorcing his wife. Zimmerman did not receive so much as a reprimand. The Spy article notes that "straight agents, or any mid-level industry powers for that matter, would have --- and have been --- fired, blasted in the trade press, and sued for such indiscretions."
A very powerful agent was Stan Kamen, employed by the William Morris agency, who died of AIDS a few years ago. His clients included Barbra Streisand, Steven Spielberg, Robert Redford and Goldie Hawn. About his homosexuality, "[T]he straight guys who came off his desk idolized him, and wouldn't mention [his sexuality], or even [kid] around about it. It was just not spoken about --- ever. It's fear, and a reverence built out of fear . . . It's not based on intellect, but based on what will happen to you," according to a former employee of Kamen's.
Jann Wenner, the founder and publisher of Rolling Stone, the far-left, pro-corporate music magazine, recently left his wife for a man. Every single U.S. publication blacked out the story, until it was finally printed by The Mail, a British paper with a circulation of over 2 million.
Geffen made sure the movie "Interview With a Vampire," directed by the homosexual Neil Jordan (who also directed the perverted movie "The Crying Game") had its homoerotic undertones removed. This was also insisted upon by lead actor Tom Cruise, who has been the subject of much speculation about his sexual orientation. Cruise "squirmed around" that subject area when interviewed by Vanity Fair last year.
The Disney studio, once an icon of American wholesomeness when it was run by Walt Disney, has five top executives who are homosexual.
Even the Los Angeles Police Department has decided to leave the super-powerful Geffen alone. The LAPD recently busted David Forest, the head of a male prostitution ring on a par with the one run by Heidi Fleiss. According to Spy, Geffen's name was at the top of Forest's client list. But the LAPD refuses to use Geffen's name as evidence during the trial, a detective being quoted as saying, "We don't wanna touch Geffen."
Ebner also writes about the "Circle of Fire," a group of young, good-looking guys who are flown around the country to the "big orgy parties" held by homosexual power brokers.
Even the existence of the Lavender Mafia is denied by most of the principles involved. The incessant need to not only advance their fellow homosexuals but to zealously protect each other from public scrutiny is because the "need to maintain America's wholesome image of them is something that connects Hollywood gays at all levels --- whether one is a struggling (or a mega-star) actor, writer, agent, or producer," Ebner writes.
Virtually all of the "Gay Mafia" are Jewish. Vicious character attacks are always leveled at anyone who has noted the undeniable fact that Hollywood has been Jewish dominated since its inception --- yet most Americans are aware of that fact. Probably very few are aware yet of the rise within that subculture of a homosexual subculture to dominance.
Many critics of the current System note that even as Americans seem unable to influence the political process with their votes for two essentially similar, bureaucratic political parties, they have absolutely no sway over powerful institutions like the media, who hide behind the smokescreen that they are "objective" and that the ideology and agenda of those who control the most powerful instruments of persuasion ever invented are never to be subjected to close scrutiny.
Homosexual militants demand that their "lifestyle" be treated as equal to the traditional family, yet most still scrupulously hide their identity, preferring to do their subversive undermining of American culture as "closeted" revolutionaries. A Nationalist government will regulate the media, by ending the media dictatorship currently exercised by the radical left, and making sure that what Americans see and hear is commensurate with this country's heritage and values.
FRANK SINATRA AND MAFIA
On February 10, 1961, FBI Director J. Edgar Hoover sent a pointed memo to United States Attorney General Robert F. Kennedy, regarding singer Frank Sinatra's extensive connections to organized crime figures. It was a classic Hoover move. Information had always been Hoover's best weapon, and in Sinatra's case the director had stockpiled plenty of ammunition. Special agents had been keeping tabs on the singer since 1947 when he took a four-day trip to Havana and painted the town red with a gaggle of powerful Cosa Nostra members who had gathered there for a mob conference. Hoover's unstated message to the attorney general in that memo was as subtle as a sledgehammer: Look who your brother the president has been hanging around with. In fact, Sinatra had been an avid supporter of John F. Kennedy in the 1960 presidential election, and they had become quite close.
In the memo Hoover gave a précis of Sinatra's alleged criminal background prior to his Mafia involvement. Hoover wrote that in 1944, according to “an anonymous complaint,” Sinatra had paid $40,000 to get out of the draft. The FBI director went on to point out that Sinatra had “reportedly been associated with or lent his name to sixteen organizations which have been cited or described as communist fronts” even though the bureau's investigation never uncovered sufficient evidence to prove that Sinatra was ever a Communist Party member himself.
Hoover then ticked off Sinatra's criminal associates, including Joseph and Rocco Fischetti, who were cousins of Al Capone; New Jersey crime boss Willie Moretti; James Tarantino who was himself an associate of gangster Bugsy Siegel; Mickey Cohen of Los Angeles; and reigning Chicago boss Sam Giancana. According to Hoover, when Giancana had been arrested in 1958, the police found Sinatra's private telephone number in Giancana's wallet. Hoover described a command performance by Sinatra and singer Dean Martin at the home of “notorious Chicago hoodlum” Anthony “Joe Batters” Accardo. According to Hoover, in the summer of 1959, Sinatra allegedly hosted a nine-day, round-the-clock party at the Claridge Hotel in Atlantic City where Chicago wiseguys rubbed elbows with top East Coast mobsters, including Vito Genovese and Tommy Lucchese. Hoover even quoted a female informant who had met Sinatra and Joe Fischetti at the Hotel Fontainebleau in Miami and believed that the singer had “'a hoodlum complex.'”
Charges like these plagued Frank Sinatra throughout his life, and he repeatedly and vehemently denied having any formal association with the Mafia. But Hoover hadn't pulled these names out of thin air. Even if Sinatra wasn't a criminal himself, he certainly knew plenty of criminals and considered many of them good friends. Despite his denials, year after year, evidence piled up indicating that Sinatra enjoyed a very special relationship with the Mafia.
Nevertheless, the singer continued to complain that he was being unfairly tarred with the organized-crime brush simply because he occasionally happened to meet someone who had a criminal record or because his last name “ended in a vowel.”
ACCUSSATIONS
But the record shows that Sinatra's relationships with known mob figures were often more than just casual meetings with fans.
He performed in clubs and theaters controlled by the Mafia. He made investments with mobsters. He used his status as a celebrity to make requests on their behalf—all the way to the Oval Office in one instance. He hosted men of honor at his home, at his hotels, even at his mother's home. He apparently valued their company as much as they valued his, and if he publicly chafed at being tarred with the Mafia brush, he often used his gangland veneer to instill fear and respect on his late-night romps in the “wee small hours of the morning.”
But what exactly was Frank Sinatra's relationship with the Mafia? Was he so respected and revered by the wiseguys that they considered him one of their own? Was he actually an inducted member of the secret criminal society? Or was he simply used by mobsters for their own purposes as they used so many others? Was Sinatra a Mafia groupie, taken in by the aura of power and invincibility, intoxicated by the association? Was he their patron saint? Or was he their patsy?
SINATRA
Frank Sinatra and the Mob
Frankie and the Boys 1976 - Left to right: Paul Castellano, Gregory DePalma, Sinatra, Tommy Marson, Carlo Gambino, Aladena Fratianno, Salvatore Spatola, Seated: Joseph Gambino, Richard Fusco
Rumors of mob connections hounded Frank Sinatra throughout his storied, tumultuous life. His denials were as ready on his lips as his trademark song ''My Way'' became in his waning years. J. Edgar Hoover didn't buy it. He thought Ol' Blue Eyes was a murderer and a Mafioso with a golden voice. Despite Hoover's FBI amassing the largest file on Sinatra of any entertainer in U.S. history, none of the damning information there ever made it to a grand jury. Numerous times the government got close to indicting Sinatra, but it never did. Sinatra had friends in the highest places,
Sinatra's friendships:
first President Kennedy and then President Nixon and finally President Reagan. Each, in different ways and to varying degrees, came to his aid when he most needed them, enabling him to front for the mob with impunity.
Recently the FBI released on its web site all 1,275 pages of Sinatra's FBI file. His file may be viewed at http://foia.fbi.gov/sinatra.htm. Beginning more than a year ago, the FBI began posting files of scores of other deceased celebrities it had maintained files on to the bureau's web site. There one can read about Charles A. Lindbergh (1,368 pages), Robert Kennedy (1,263), Joseph Kennedy (1,011), President Kennedy (178), Henry Ford (376), Abbie Hoffman (13,262), Martin Luther King Jr. (16,659), Malcolm X (11,674), Nelson Rockefeller (1,472), Cardinal Francis Spellman (536), Marilyn Monroe (80), Jackie Robinson (131), and, of course, the Mafiosi: Al Capone (2,397), Sam Giancana (2,781), and Carlo Gambino (1,239) to name a few.
In the past 25 years, since Congress amended the Freedom of Information Act and passed The Privacy Act, the FBI has grudgingly responded to more than 300,000 Freedom of Information Act requests to release its declassified files. During that time, the FBI has turned over six million pages of FBI documents to the public - mostly news organizations and researchers - in paper format. It would send files to people who filed Freedom of Information requests in writing and who were willing to pay the fees involved. Now, though, the bureau's web site is making posted files available to the public at no charge.
The files the FBI turns over are far from pristine. Some are illegible, some are smeared and almost all have been heavily redacted by FBI agents who went over the files prior to releasing them. The redactions are black marks through names and passages of the file that the agent reviewing the file decides to keep hidden based on various criteria within the bureau's purview. The Freedom of Information and the Privacy acts allow the agent to use any number of security or privacy reasons to redact names and other information from the file. In the case of Sinatra, for example, his name is probably never redacted but the names of stool pigeons or FBI sources used to gather information about him are. Many of the Chairman of the Board's Rat Pack friends received no such kid-glove treatment. Dean Martin, for example, is linked time and again to Sinatra misdoings.
Reading an FBI file, particularly one as voluminous and replete with redactions as Sinatra's, is no easy task. It is largely a mumbo-jumbo of dates, names and incidents, many of them half-baked, wild-goose chases the FBI took in investigating Sinatra. You could easily get the impression that the FBI did not mean to make reading its files an easy chore. (Click here to see a chronological index of Sinatra's file posted on my web site.)
FBI files are an uneven amalgam of fact, rumor, suspicion, allegation, unvarnished gossip, false leads and trivia. Lots of trivia. This is particularly the case in a file as large as Sinatra's.
When the FBI was compiling Sinatra's file it certainly had no intention of ever exposing it to public view. Although there's a dry professionalism to the agents' reports, an antipathy to the crooner permeates the file.
Because the reports in an FBI file were not written for public consumption or scrutiny, they say in an unintended way as much or more about the internal workings of the FBI as they do the famous and infamous subjects investigated. As secret, internal documents the bureau compiles on citizens or groups it either considers a threat to national security or, as in the case of Sinatra, involved in organized crime, the reports in the file allow the agents writing them a free-wheeling opportunity to report whatever they've come up with without the threat of libel. Agents are under no compunction to be fair or even handed or to get both sides of the story. An FBI file on a person does not tell the whole story, nor, in fact, does the file itself form any type of narrative. Overall, it tells a story but not in story form, just in bits and pieces as the reports from the various agents pile up.
Agents use a host of sources in compiling a file. Wiretaps, stool pigeons, personal surveillance, interviews of the subject's acquaintances, neighbors and known enemies, media accounts (gossip columns in particular) and tips gathered from the FBI's hotline. Among all these sources, wiretaps and direct FBI surveillance often provide the most reliable and damning information about a subject under FBI scrutiny. Because the company Sinatra kept included a large number of high-profile mob figures, a veritable who's who of the Mafia from the 1940s on, Sinatra's FBI file includes many references to him gathered in wiretaps of those criminals.
Sinatra'a connections
In the 1960s most Americans became aware of Sinatra's friendship with Sam Giancana, the Mafia boss of Chicago. Most people were unaware of the connections of Sinatra's family and the help he received from mobsters in his career. His FBI files definitively show that Sinatra was up to his ears in mob-related schemes and activities throughout his entire adult life.
Sinatra's connection with mobsters actually began at birth. His uncle, Babe Gavarante, was a driver for a gang of armed robbers and may have been connected to the organization Willie Moretti ran in Bergen County and northern New Jersey. Gavarante, the brother of Sinatra's mother, was convicted of murder in 1921 in connection with an armed robbery in which he had driven the get-away car. He was sentenced to 15 years at hard labor.
One persistent rumor held that Sinatra was distantly related to Al Capone. Whether he was a cousin of Big Al, or not, Sinatra did have a life-long relationship with the infamous Fischetti brothers. Charles, Joseph and Rocco Fischetti were cousins of Capone and well-know gangsters in their own right.
The Fischetti Brothers
Charles ''Trigger Happy'' Fischetti, called a notorious ''Chicago gangster'' in the FBI files, was the mob's political fixer in Chicago. He and Sinatra were known to be close friends as early as the 1940s.While Charles Fischetti was under FBI surveillance in 1946 he and Sinatra visited Fischetti's mother in Brooklyn for three hours. Sinatra also helped Fischetti get tickets to sports events several times. Sinatra helped Fischetti set up a string of auto dealerships, by lending his name to the enterprise and doing commercials free of charge. (Sinatra did receive at least two Thunderbirds that became the property of Sinatra Enterprises.)
Joseph Fischetti, also known as a ''Chicago gangster,'' but better known for his activities in Miami, especially in connection with the Fontainbleu Hotel, was one of Sinatra's closest friends in the 1940s. FBI surveillance of Fischetti shows that he and Sinatra kept in weekly telephone contact for an extended period. They met in person several times in New York and Miami.
A trip with Fischetti to Havana in 1947
Sinatra was Joseph Fischetti's houseguest in Miami in February 1947 when they traveled to Havana in the company of Joseph's brother, Rocco, who was in charge of Chicago gambling and was a notorious woman-beater. On this infamous trip Sinatra met with Charles ''Lucky'' Luciano. Rumors about this meeting dogged Sinatra for the rest of his life.
Performance in Fischetti's hotel
Sinatra and Joseph Fischetti remained friends for years. Sinatra performed many times at the Fontainbleu Hotel in Miami. Fischetti was deeply involved with this hotel. As early as May 1947 Fischetti had bragged to an FBI informant about his ''financial interest'' in Frank Sinatra. Fischetti worked as a sort of agent for Sinatra in Miami and Chicago and got him several bookings in the early 1950s when Sinatra's career was nearly dead.
For his performances he was paid in jewelry instead of cash
Fischetti's financial interest nearly came to light in 1963 when the IRS investigated the so-called ''Fontainbleu Complex.'' This investigation revealed that Sinatra performed ''without charge'' at the Fontainbleu and that Joseph Fischetti, who was being paid more than $1,000 per month to arrange Sinatra's performances, gave him expensive pieces of jewelry instead of cash. This story came to light again during Nevada Gaming Commission hearings in 1981. Again the charges were never proved.
Willie Moretti
Sinatra's first wife's cousin was a key Moretti mob
Family connections led to another major underworld link that was very important to Sinatra's career. Nancy Barbato, Sinatra's first wife, was a cousin of a ''key member of Willie Moretti's mob,'' as the FBI report put it. Moretti controlled gambling and other rackets in Bergen County and northern New Jersey and was a known associate of Frank Costello, the New York Mafia boss.
Moretti ran his career
After Sinatra's marriage to Nancy Barbato, Moretti (a.k.a. Willie Moore) took an interest in the young singer's career. He arranged several singing engagements for Sinatra, giving his career a large boost. Moretti also set an example for other mobsters who would later befriend Sinatra. Sinatra several times denied that Moretti helped his career. Columnist Lee Mortimer's allegations concerning Moretti led to Sinatra assaulting Mortimer. Sinatra's private testimony to the Kefauver Committee, on March 1, 1951, tells the true story, ''Well, Moore, I mean Moretti, made some band dates for me when I first got started….''
In 1948 Moretti told undercover FBI agents that he had an ''association'' with Sinatra. Later that year an informant told the FBI that both Sinatra and comedian Lou Costello ''kicked in'' to Moretti. In 1949, when Sinatra separated from his wife and was seen in public with Ava Gardner, Moretti sent him a telegram urging him to return to his wife.
Mario Puzo's book was based on Sinatra-Moretti connections
Moretti testified openly, maybe too openly, to the Kefauver Committee, admitting that he was a gambler. Ten months later he was gunned down in Joe's ElbowRoom in Cliffside Park, N.J. Later, when Mario Puzo's book, The Godfather, came out it was widely rumored that one of the characters was based on Sinatra and that Don Corleone was partly based on Willie Moretti.
Tommy Dorsey always denied that he had been threatened in order to release Sinatra from his long-term contract; it is fairly certain that movie mogul Harry Cohn never found a horse's head in his bed. But Sinatra did sing at the wedding of Moretti's daughter in 1948, and he clearly had a great deal of affection for his neighbor and benefactor, Willie Moretti. Moretti, in return, took a great interest in Sinatra's career and helped him wherever he could.
Sam Giancana
Sinatra's most enduring, and well known, association with a mobster was with Sam ''Momo'' Giancana. Giancana started out as a thief and killer in Chicago in the 1920s. He was arrested for murder in 1926, but was not prosecuted because the state's case fell apart when Alexander Burba, a cab driver and the main witness, was murdered. Giancana was rumored to be the driver and a gunman at the 1929 St. Valentine's Day Massacre. He spent a good part of the 1920s and 1930s in prison for various crimes.
By the late 1940s Giancana was closely associated with Anthony ''Tony Batters'' Accardo, an ex-bodyguard of Al Capone and rumored to be one of the gunmen in the Saint Valentine's Day Massacre. By the late `50s Giancana had risen to the top of the heap in Chicago. There he controlled protection, pinball, prostitution, numbers, narcotics, loan sharking, extortion, counterfeiting and bookmaking. He was arrested over 70 times, three times for murder.
In consolidating his power Giancana ordered the deaths of over 200 people, some of whom were tortured to death. These killings brought him to the head of an international crime empire, which included interests in the Riviera, Sands and Desert Inn hotels in Las Vegas estimated by the FBI to generate over $2 billion in income annually. Some $40-$50 million of that went directly to Giancana.
Giancana liked to be around entertainers and he had several of them for friends including Joe E. Brown, Jimmy Durante, Dean Martin, Keeley Smith, and Phyllis McGuire (of the McGuire Sisters). It was Frank Sinatra's sapphire friendship ring that Giancana wore every day, though. Giancana was often annoyed by the attention Sinatra generated and thought he had a ''big mouth,'' but he was a regular at Sinatra's legendary parties. Giancana often visited Sinatra in his dressing room at the Sands Hotel and at the Fontainbleu in Miami.
Judith Campbell was introduced to Giancana by Sinatra
According to FBI files, the autobiography of Antoinette Giancana and the testimony of Johnny Roselli to the U.S. Senate Church Commission in 1975, it was Giancana, along with a few other mobsters, who conspired with the CIA to assassinate Fidel Castro in the early 1960s. Giancana also had the distinction of sharing a mistress, Judith Campbell, with President John F. Kennedy. Sinatra introduced her to both men. Giancana is often named as a suspect by people who believe the Mafia assassinated President Kennedy. Giancana was murdered in 1975 after his role in the Castro plot came to light, but before he could testify at congressional hearings investigating the CIA.
For a good part of his life Giancana was under constant FBI surveillance. At one point Giancana got a court order to make his FBI tail stay two foursomes behind him on the golf course. This surveillance extensively documents the relationship between Giancana and Sinatra.
Sinatra told IRS investigators in 1959 that he met Giancana at the Fontainbleu Hotel in March 1958. Sinatra always maintained that he and Giancana were friendly, but not close, and that they had no business relationship. The FBI surveillance shows this to be a lie.
Sinatra played a kind of court-jester role for Giancana, giving command performances when asked. Sinatra also arranged command performances by other entertainers for Giancana, especially at Giancana's Wheeling, Ill., nightclub, the Villa Venice Supper Club, a front for an illegal-gambling operation. Sinatra arranged several shows there featuring himself, Dean Martin, Sammy Davis Jr. and Eddie Fisher. The performers at these shows worked gratis.
On at least one occasion, in October 1962, Eddie Fisher was coerced into making an appearance at the Villa Venice. Fisher had just finished a successful engagement in New York City and had planned a long run at the Desert Inn in Las Vegas.
Giancana decided that he wanted Fisher for the re-opening of his club on Halloween. Fisher, his agent and Moe Dalitz, the operator of the Desert Inn, were against changing Fisher's plans. Fisher and his agent thought it could hurt his career. None of them, however, had the courage to turn down Giancana. It was arranged for Fisher to split his engagement at the Desert Inn so he could appear at the Villa Venice.
After the arrangements were made Giancana changed his mind and decided he wanted Fisher for a three-week engagement. Fisher voiced his reluctance to Sinatra, who said (according to an FBI report), ''Look, you're going over there for 18 days. Never mind about the Desert Inn, I already handled that. I take care of that. They do what I tell them.'' The FBI estimated, based on overheard conversations, that the Villa Venice reopening, and gambling at the nearby Quonset Hut, grossed over $3 million.
As for the business relationship between Sinatra and Giancana, nothing was ever clearly proven. The most consistent allegation is that Sinatra acted as a front for Giancana's ownership of the Cal-Neva Lodge in Lake Tahoe in the early `60s. Giancana was included in Nevada's ''Black Book'' that listed the 11 men who were not allowed into any Nevada gambling establishment, so his ownership of any gambling interests there had to be covered up.
Sinatra as a owner of 50% of Giancana's hotel Cal-Neva
In 1960 Giancana made arrangements to buy the Cal-Neva Lodge, located at the north end of Lake Tahoe exactly on the California-Nevada border. The owners of record would be Frank Sinatra, Hank Sanicola (an old friend and business partner of Sinatra's) and Dean Martin. At first Sinatra owned one-third of the hotel, but within a couple of years his ownership had risen to over half and Dean Martin had dropped out in favor of Sanford Waterman. Paul ''Skinny'' D'Amato, one of Giancana's lieutenants who had ''worked'' the West Virginia primary for John Kennedy, took over day-to-day operation of the club.
The Cal-Neva Lodge, with its unique location half in California and half in Nevada, was perfect for Giancana's purposes. He visited the club regularly (when he would admit visiting he claimed that he always stayed on the California side) for trysts with his mistress, Phyllis McGuire, meetings with other mobsters or Sinatra's wild parties. Giancana's visits made Hank Sanicola, who had invested $300,000 of his own money, nervous because federal agents often accompanied Giancana. Sinatra told Sanicola not to be a ''worrier''.
Giancana's ownership of the hotel was confirmed by the FBI, which recorded a conversation between Giancana and Johnny Roselli (his representative in Las Vegas), in which Giancana said, ''I am going to get my money out of that joint (Cal-Neva) and end up with half of it with no money.''
For Sinatra, the Cal-Neva Lodge was cursed. After a heated spat with Ava Gardner there in 1951, Sinatra took an overdose of sleeping pills. He later denied that he had tried to kill himself, but in 1985 George Jacobs, Sinatra's longtime valet, told Kitty Kelley: ''Thank God, I was there to save him. Miss G was the love of his life, and if he couldn't have her, he didn't want to live no more.'' Gardner would become Sinatra's second of four wives; he later would marry Mia Farrow and Barbara Marx. His three children, Nancy Jr., Frank Jr. and Tina were born to his first wife.
In 1962 Federal Agents investigated a prostitution ring that was run openly through the registration desk. A few weeks later an attempt was made on the life of one of the employees in front of the hotel. Shortly afterward Marilyn Monroe took an overdose of sleeping pills there. She was saved, but died a few days later in Los Angeles. That same summer ex-Deputy Sheriff Richard Anderson had a fight with Sinatra at the Cal-Neva Lodge, a few days later Anderson died in a mysterious car accident. Many people, including J. Edgar Hoover, suspected Sinatra of having Anderson killed, but nothing was proved.
The next summer, during a singing engagement at the Cal-Neva by the McGuire Sisters, Phyllis McGuire, Sam Giancana, Frank Sinatra and Victor LaCroix Collins, road manager for the McGuire Sisters, became involved in a brawl in Giancana's bungalow. FBI agents witnessed the fight and informed the Nevada State Gaming Commission. This was the last straw and in August 1963, Ed Olson, chairman of the commission started an investigation with the goal of revoking Sinatra's gaming license.
How Sinatra used his power to fight all the charges against him
Sinatra used all of his power and prestige to fight the charges against him. When he addressed the General Assembly of the United Nations he made a joke about his ''used casino.'' President Kennedy even interceded on his behalf, asking Nevada Gov. Grant Sawyer during a Las Vegas motorcade why he was ''being so hard on Sinatra.'' In the end the case was too convincing against Sinatra and he voluntarily gave up all his interests in Nevada casinos, which included interests at the Sands and Desert Inn as well. He was still allowed to perform in Nevada, but it was not until 1981 that he managed to obtain a new gaming license.
Protection from Giancana
Sinatra's relationship with Giancana, coupled with his own unruly temper, gave him a reputation for being dangerous. On more than one occasion people who had angered Sinatra received threatening phone calls saying that Giancana would ''teach them a lesson.'' The most blatant example of this came in 1966 when comedian Jackie Mason angered Sinatra by making jokes about his marriage to Mia Farrow. Mason received phone calls threatening his life, but refused to change his routine. Six days later three bullets were fired through the glass door of Mason's hotel room in Las Vegas. The Clark County Sheriff's Department investigated, but dropped the case because it said there was no motive for the shooting.
Jackie Mason talks about Sinatra and mysterious phone calls and warnings
Mason stopped making his jokes about Mia Farrow, but continued to make cracks about Sinatra in his show. A few weeks later, at an appearance in Miami, Mason quipped, ''I don't know who it was that tried to shoot me…After the shots were fired all I heard was someone singing: Doobie, doobie, do.'' Mason received four death threats that week with warnings that he should stop talking about Sinatra.
On Feb. 13, 1967, while Mason was sitting in a car in front of an apartment building in Miami, a man wearing brass knuckles yanked open his door and smashed Mason in the face, breaking his nose and crushing his cheekbone. ''We warned you to stop using the Sinatra material in your act,'' the attacker said before leaving. Mason finally got the message and stopped using jokes about Sinatra.
After Giancana's semi-successful lawsuit against the FBI, in 1963, the publicity around him began to seem dangerous to Tony Accardo and Paul Ricca, the real Mafia powers in Chicago. When Giancana was jailed for contempt of court in 1965, that was the end of his power. After his release he was exiled in Mexico for the rest of his life.
Benjamin ''Bugsy'' Siegel
Frank Sinatra was physically a small man. At his local draft board physical in 1943, the 5'71/2''-teen idol weighed in at 119 pounds. (He flunked the physical due to a perforated left eardrum.) Sinatra idolized the strong and the tough. Since boyhood he always wanted to be around the strongest and the toughest men he could find. This led to his strong attraction to both boxers and gangsters. One FBI informant said it was well known that Sinatra had a ''hoodlum complex''.
According to Eddie Fisher, Sinatra once said, ''I would rather be a Mafia don than president of the United States.'' According to Jo-Carroll Silvers, wife of comedian Phil Silvers (a good friend of Sinatra's), ''Phil and Frank adored Bugsy (Ben) Siegel…They were like two children seeing Santa Claus…They were so wide-eyed and impressed with this man…They would brag about Bugsy, what he had done and how many people he had killed… I will always remember the awe Frank had in his voice when he spoke about him (Siegel). He wanted to emulate Bugsy.''
Benjamin ''Bugsy'' Siegel was the representative of Meyer Lansky and Lucky Luciano in Los Angeles from 1934 until his death in 1947. He was known as one of the original members of the legendary, and some say fictional, Murder Inc. Siegel was also one of organized crime's pioneers in Las Vegas, building the Flamingo Hotel which opened on Christmas Eve 1946. Sinatra and Siegel had a nodding acquaintance, but there is no evidence that there was anything more than that.
Mickey Cohen
The relationship between Sinatra and Mickey Cohen is well documented. Cohen was a Siegel lieutenant who made himself an underworld power after Siegel's death. Cohen, a Jew, was never a ''made guy'' (a member of La Cosa Nostra), and he had constant battles with Jack Dragna, the official Mafia boss of Los Angeles, but he remained a powerful crime figure all through the 1950s and well into the 60s.
Cohen and Sinatra were fairly close friends. Sinatra visited him at his home in 1948, even though Cohen warned him that he was under constant surveillance, to ask him to have Johnny Stompanato, Cohen's bodyguard, stay away from Ava Gardner. Cohen told him that he never mixed in between men and their ''broads'' and that Sinatra should go back to his wife and kids. ''I talked to him like a friend,'' Cohen stated later in his autobiography.
Cohen, like the other mobsters who knew Sinatra, used him for his star power. On at least one occasion Cohen called Sinatra and asked him to meet with a business associate from Ohio and his 14-year-old daughter. Sinatra didn't rush over to Cohen's house, as Cohen wanted, but he did invite them to a radio broadcast where all three were allowed to sit on the stage.
James Tarantino and Hollywood Nite Life
Tarantino run a tabloid blackmailing many of well-known people
Through Cohen Sinatra got involved with James Tarantino and his blackmail/scandal sheet, Hollywood Nite Life. Tarantino, an ex-sportswriter who had known Sinatra from the New York boxing scene in the early `40s, used the tabloid in a blackmail scheme. He would dig up dirt on Hollywood celebrities and then threaten to publish his information if the stars didn't advertise with him.
Columnist Westbrook Pegler called Tarantino, who had been a member of The Varsity (a group of Sinatra's friends that was a forerunner of the later Clan or Rat Pack), a protégé of Sinatra. According to Tarantino, who was later convicted of extortion, he and Hank Sanicola started Hollywood Nite Life in 1945. Sinatra, he said, had put up $15,000 to get the magazine started.
According to him Sinatra was interested in not publishing some information about him
In his private testimony to the Kefauver Committee, in 1951, Sinatra gave a different version of the story:
Q: We have information to the effect that you gave Tarantino quite a large sum of money to keep him from writing a quite uncomplimentary story about you.
A: Well, you know how it is in Hollywood…Jimmy called up and said he had an eyewitness account of a party that was supposed to have been held down in Las Vegas in which some broads had been raped or something like that. I told Jimmy that if he printed anything like that he would be in a lot of trouble.
Q: Did he ask you for money?
A: Well, I asked Hank Sanicola, my manager, to handle it and that was the last I heard of it…
Q: Did Hank tell you he paid Tarantino?
A: Well, I understand Tarantino was indicted and I don't know the rest of the story, but the Hollywood Nite Life quit publishing this crap afterward.
Another version of the story, retold in Kelley's book His Way, was that Mickey Cohen asked Sinatra for $5,000, on three separate occasions for a total of $15,000, to suppress articles in Hollywood Nite Life. Whether Sinatra was blackmailed by his ''friend,'' Cohen, his ''protégé,'' Tarantino, or he voluntarily gave money to support the magazine, he did advertise with Tarantino and he always got good publicity in Hollywood Nite Life.
Charles ''Lucky'' Luciano
Charles ''Lucky'' Luciano was one of the most powerful and influential Mafia bosses in American history. He is considered by some to be the real winner of the Castellammarese War of 1930, which led to the formation of New York's Five Families. After his brief war with Sal Maranzano in 1931, in which he earned his ''Lucky'' nickname, Luciano consolidated his power by forming the Commission.
The Commission was a group of heads of Mafia families that met regularly to work out inter-family problems. The Commission was designed to save the mob from autocratic rule by dictatorial bosses and internecine warfare. It worked for a while, but its main effect was to increase Luciano's power. Luciano became so powerful, in fact, that he was the main target of New York D.A. Thomas Dewey, who built his political reputation by prosecuting top mobsters.
In 1936 Dewey successfully convicted Luciano of controlling prostitution in New York. At the end of World War II, Luciano was released from prison and deported to Italy.
In 1946 Luciano traveled to Cuba in an effort to reassert his power over the American mob. All of the most prominent underworld leaders traveled to pay their respects to Luciano at the famed ''Havana Conference.'' It looked as if Luciano would be able to hang onto his position and rule the mob from Havana.
Sinatra made at least two trips to Havana to meet Luciano. One trip was over Christmas 1946. Sinatra performed on Christmas Eve at a party held in his honor by Luciano. This party came during a break in a meeting that decided the fate of Siegel, who was killed a few months later. The second trip, over a four-day weekend in February 1947 is documented in Sinatra's FBI file. He traveled to Havana with Joseph and Rocco Fischetti. They stayed at the Hotel Nacional and all three met with Luciano on more than one occasion.
This trip was widely reported in the media and it caused Sinatra problems the rest of his life - both with the public and the underworld. That trip would later lead to allegations that Sinatra delivered $2 million in cash to Luciano.
Joseph ''Doc'' Stacher, who ran Meyer Lansky's operation in New Jersey at the time and later ran the Sand's Hotel, remembered the Havana meeting years later in an interview quoted in Kitty Kelley's His Way: ''The Italians among us were all very proud of Frank. They always told me they had spent a lot of money helping him in his career ever since he was in Tommy Dorsey's band. Lucky Luciano was very fond of Frank's singing. Frankie flew into Havana with the Fischettis, with whom he was very friendly, but of course, our meeting had nothing to do with hearing him croon…Everyone brought envelopes of money for Luciano …But more important, they came to pay allegiance to him.''
It is likely that Sinatra also gave an envelope of cash to Luciano, but it is far-fetched that he carried $2 million in his briefcase for him, as it was later charged. As Sinatra said in his 1981 NSGC hearing, ''Show me a briefcase that will hold $2 million in cash and I'll give you the money.''
Shortly after the February meeting Robert Ruark, a New York columnist, wrote an article about Sinatra's visit to Luciano. The U.S. government put pressure on Cuba to deport Luciano to Italy. Many mobsters thought that it was Sinatra's bragging about meeting Luciano that led to his deportation. This led to Sinatra's reputation as a ''big mouth''.
Luciano knew better. According to organized-crime historian and writer Allan May, Luciano believed that Vito Genovese had informed on him by telling Harry Anslinger of the Narcotics Bureau that Luciano was in Havana. (See ''Havana Conference - 1946'', by Allan May.) Sinatra and Hank Sanicola later visited Luciano in Naples, Italy, where Sinatra presented him with a gold cigarette case engraved: ''To my dear pal Charlie, from his friend Frank.'' The cigarette case and a piece of paper bearing Sinatra's unlisted telephone number were found on Luciano when Italian police searched him in 1949.
Frank Costello
Frank Costello was acting boss of what later became known as the Genovese family during Luciano's incarceration and exile. In 1947 he became the boss, but spent the next 10 years feuding with Vito Genovese for control of Luciano's empire. In 1957 he was shot and wounded by Vincent ''Chin'' Gigante. Costello subsequently retired in favor of Genovese.
Many rumors and reports of Sinatra's connection with Costello exist, but there is very little evidence to back them up. Sinatra and his sycophant group, The Varsity, spent a great deal of time at boxing matches at Madison Square Garden in the early 1940s. Frank Costello was known to hang out there as well, so it is very likely that they met.
Costello was known to be the padrino of Willie Moretti so it is possible that he also took an interest in Sinatra's career. Costello owned the Copacabana nightclub in New York and always attended Sinatra's engagements there. Costello was believed to be the true owner of the Sands Hotel in Las Vegas, in which Sinatra also had a part ownership. The San Francisco police also believed Costello to be the true owner of Hollywood Nite Life.
Columnist John Miller is quoted, in Kitty Kelley's biography of Sinatra, as saying, ''Sinatra and Frank C. were great pals. I know because I used to sit with Frank C. at the Copa and Sinatra would join us all the time. He was always asking favors of the old man, and whenever Sinatra had a problem he went to Frank C. to solve it.'' Miller was making the point that Costello secured the role of Maggio in From Here to Eternity for Sinatra. While it is highly likely that Sinatra asked for Costello's help in this, and Harry Cohn, of Columbia Pictures, had as many mob ties as Sinatra, it is also clear that it was Sinatra's own efforts, with an assist from Ava Gardner, that got him that role.
There are several rumors in Sinatra's FBI file that Sinatra was ''brought up'' by Costello and that Costello put pressure on Willie Moretti to help Sinatra. Again there is no proof behind these rumors and, knowing Sinatra's connection to Moretti, it is more likely that Moretti gave Sinatra an ''in'' with Costello, than the other way around.
Las Vegas
No performer was more associated with Las Vegas than Frank Sinatra. His affiliation with several hotels in Las Vegas brought him into contact with a wide variety of mobsters.
The Sands Hotel
In 1954 Sinatra obtained a Nevada gaming license and bought a 2 percent interest in the Sands Hotel. Later Vicente ''Jimmy Blue Eyes'' Alo gave him a gift of an additional 7 percent of the hotel. Sinatra remained associated with the Sands until 1967, although he gave up his ownership in 1963 in the Cal-Neva/Warner Bros. deal, eventually rising to vice president of the corporation and earning $100,000 per night when he performed. Among the perks he received at the hotel was free no-limit gambling in the casino.
The Sands Hotel was a joint enterprise run by the Genovese family and the Chicago Outfit. Many mobsters were associated with the hotel including:
In 1967 Howard Hughes purchased The Sands Hotel. Frank Sinatra negotiated a new contract with the mob-owned Caesar's Palace and broke his contract with the Sands. The breaking of The Sands' contract was a memorable Sinatra tantrum in which he trashed the lobby and pool before having two teeth knocked out by casino manager Carl Cohen.
Desert Inn
Sinatra appeared at the Desert Inn many times from the early 1950s until Howard Hughes purchased it in 1967. A group of mobsters, mostly from Cleveland, owned the Desert Inn. Meyer Lansky and Sam Giancana also had interests in the hotel. Moe Dalitz, a close friend of Sinatra, ran it. Dalitz helped keep Sinatra employed when his career hit a low point after 1949.
In the 1920s and 1930s, Dalitz was a bootlegger from Cleveland, aligned with the Italian Mayfield Road Mob.
At the Desert Inn Sinatra was known to hang out with people such as Benny Macri, who was suspected of being the killer of a union organizer in New York. Macri was not convicted of this crime, although he had a reputation as a killer in the underworld. He was also pals with Aladena ''Jimmy the Weasel'' Fratianno, an enforcer and executioner for Jack Dragna in Los Angeles. Later Fratianno would be acting-boss of the LA crime family and he was involved in the Westchester Premier Theater scam with Sinatra, detailed later. Fratianno eventually became a celebrated informer for the FBI.
Caesar's Palace
The origin and ownership of Caesar's Palace in the 1960s is shadowy, but, like the other Las Vegas casinos that Sinatra was associated with, Caesar's employed several people with ties to organized crime. Two in particular were Eugene Cimorelli, the casino's official greeter. He was an associate of Chicago gangster Anthony ''Tony the Ant'' Spilotro and golf partner of Anthony ''Tony Batters'' Accardo, the behind-the-scenes boss of Chicago. The other was Sanford Waterman, who had previously been one of Sinatra and Giancana's partners in the Cal-Neva Lodge. Waterman was later convicted of racketeering.
In 1970 the IRS began an investigation of operations at Caesar's Palace. During the investigation it became evident to investigators that Sinatra was scamming cash from the casino by cashing in chips that he had received for free. When Waterman, the casino manager, was informed of this he confronted Sinatra inside the casino. Typically, Sinatra reacted violently. The men exchanged ethnic slurs. When Sinatra became violent Waterman pulled a gun and pointed it at Sinatra's head, ending the fight. Assault charges were dropped against Waterman because there were visible marks on his throat where Sinatra had been holding him.
After the fight with Waterman, Sinatra vowed never to set foot in Nevada again. He returned in 1973, after Waterman was arrested on racketeering charges and Caesar's Palace offered him $400,000 per week (a record for Las Vegas performers at the time) and a free bodyguard.
In 1980 Sinatra forced Caesar's Palace to list him as a key employee so he could apply for a new Gaming License. He said that he wanted to clear his name from charges that led to his license being pulled in 1963. Sinatra paid $500,000 for an investigation of his past and used all of his connections and power (including the support of President Ronald Reagan) to influence the outcome of the NSGC hearings.
At the hearings, that took place over several months in 1981, Sinatra lied repeatedly about his activities and relationships with criminals and mobsters. In the end he was granted a Nevada Gaming License once again. ''We got that junk behind us. We cleared the air,'' he said.
Carlo Gambino
Carlo Gambino was a member of the New York crime family that was headed by Albert Anastasia and later became known as the Gambino family. He was involved in the 1957 plot, with Vito Genovese and Thomas Lucchese, that brought Genovese and Gambino to power in their respective families.
Gambino, Genovese and Lucchese fought an on-and-off war with Joseph Bonnano, the head of the Bonnano crime family. Bonnano steadily lost ground as he lost allies: Albert Anastasia was murdered in 1957 and Joe Profaci died in 1962. Men whose allegiance was to Gambino replaced each. By 1967, when Vito Genovese died, Gambino was left as a near boss-of-bosses. Gambino is known for running one of the most profitable crime families in history and for never having gone to jail. He remained in control of his family, with help from Paul Castellano, until his death in 1976.
It is not clear when Sinatra first became associated with Gambino. Sinatra was involved in at least two business deals with Gambino in the 1970s. Gambino also appeared in the famous photograph taken in 1976 at the Westchester Premier Theater (one of their joint enterprises) along with Paul Castellano, Gregory De Palma, Thomas Marson, Aladena Fratianno, Salvatore Spatola, Joseph Gambino and Richard Fusco.
The business deals that Gambino and Sinatra were involved in together were:
Computer Fields Expressway - In 1970 Jack Pourtney, a stock broker at the 1st Williams Street Corporation in New York City, approached Richard Alpert about investing money in a company called Computer Fields Expressway. Alpert went to an acquaintance known to him as Joe Paris, real name Joseph Guarnera, to help him raise money to invest.
Paris, who claimed to be a relative of Carlo Gambino, raised $100,000 allegedly from Gambino, Sinatra and Jilly Rizzo (a long-time friend and occasional bodyguard of Sinatra). The stock price for CFE dropped from $12 per share to $.75 per share. According to the FBI file the drop in the stock price was because Pourtney was stealing assets from the underwriting company, 1st Williams St. Corp.
The FBI became involved, at the request of the U.S. attorney in New York, when Alpert charged that his life was threatened if he didn't return the $100,000. By this time the Securities and Exchange Commission had become involved with the investigation and Pourtney cooperated with them.
In February 1971, Alpert was subpoenaed to appear before a federal grand jury. He took the Fifth Amendment and refused to answer any questions. In March 1971, FBI agents questioned Alpert. He denied that his life had been threatened. He also denied that Frank Sinatra or Carlo Gambino had ever invested money in CFE.
Based on other deals that Sinatra was involved in it is likely that he invested money with Gambino in CFE. Whether Sinatra or Gambino invested the money in CFE, it is probable that Sinatra had no knowledge of or participation in the threats or the attempts to extort money from Alpert.
Westchester Premier Theater - The Westchester Premier Theater in Tarrytown, N.Y., began as a scheme by Gregory De Palma and Richard Fusco, members of the Gambino family. First there was an inflated stock scam, where stock was sold to ''big names'' such as Alan King, Steve Lawrence and Eydie Gorme for pennies on the dollar. The stock never drew much interest and there were several phony purchases and corporate purchases with kickbacks to executives. As a result the stock dropped to around $1 per share.
The theater was built, with huge construction cost overruns, on a landfill owned by De Palma and Fusco in 1974. De Palma and Fusco, needing more money to keep their scheme afloat, convinced Carlo Gambino to invest $100,000. He did so only on the condition that Frank Sinatra be brought in on the deal. The theater opened in 1975 with a performance by Diana Ross who was paid $235,000. Fusco and De Palma ran the theater as if it were a Las Vegas casino, skimming huge amounts from concessions and t-shirt sales and selling tickets for seats that didn't exist.
The theater was huge and very well appointed. The biggest acts in show business were booked there and the gross for the first year was estimated at $5.3 million. But by December 1976 the theater was near bankruptcy. Only a run of performances by Sinatra and Dean Martin in May 1977 delayed the closing of the theater.
Federal agents, investigating another matter, tapped the phone of Tom Marson, a friend and Palm Springs neighbor of Sinatra. They recorded a conversation between Marson and De Palma in which they discussed skimming cash from the upcoming Sinatra appearance at the Westchester Premier Theater. The result of this conversation was 10 indictments handed down by a New York Grand Jury in June 1978. During the investigation it came out that Sinatra was paid $50,000 ''under the table'' for his first appearance there. Sinatra was never indicted.
Raymond Patriarca
Raymond Patriarca was the crime boss of Providence, R.I. In the early 1950s he moved in on organized crime in Boston and by 1954 had control of all of New England. There are many rumors about Patriarca's connection with both Joseph P. Kennedy and Frank Sinatra. One rumor that is stated more than once in the FBI files is that Patriarca introduced Sinatra to organized crime figures in New York. From Sinatra's history with Willie Moretti, Frank Costello and others it is clear that this rumor is absurd.
In 1963 Sinatra invested $55,000 in the Berkshire Downs Racetrack in western Massachusetts. He and Dean Martin were named directors of the track. Rumors abounded, and were often repeated in the FBI files, that Sinatra was a front for the real owners of the racetrack: Raymond Patriarca and Gaetano ''Three-finger Brown'' Lucchese. The track went bankrupt in 1965, but the deal came back to haunt Sinatra years later.
In 1972 the House Select Committee on Crime prepared a subpoena for Sinatra to question him about the Berkshire Downs Racetrack. A phone call from Sen. John Tunney of California, for whom Sinatra had raised $160,000 during his re-election campaign, stopped the subpoena. Tunney informed the committee, after talking with Mickey Rudin, Sinatra's lawyer, that Sinatra would be glad to appear before them if he were invited.
The committee obligingly invited Sinatra to appear on June 4, 1972. Instead Sinatra flew to England. Incensed the committee prepared a second subpoena and ordered U.S. marshals to stand by at all ports of entry to issue the subpoena as soon as Sinatra re-entered the United States. Sinatra called in some favors and after telephone calls from Vice President Spiro Agnew, a close friend of Sinatra, the second subpoena was cancelled and a new invitation was issued for July 18. In addition the committee agreed to limit their questions to the Berkshire Downs Racetrack.
Sinatra took a belligerent attitude with the committee when he appeared. He also apparently lied several times. For example:
Q: Tell us about the first contact you had with anyone in relation to Berkshire Downs?
A: The first and only contact I had was with a man named Sal Rizzo.
Q: How did you know Mr. Rizzo?
A: I met him.
Q: How?
A: I can't remember where or how, but I met him and we got to talking about it and I liked his idea for the investment.
Later Charles Carson, the racetrack controller, would testify that Rizzo and Sinatra were childhood friends. Rizzo had told him that, ''I have known Sinatra since New Jersey. I was a neighbor of his and I knew the whole family.''
When Rizzo appeared in front of the committee he took the Fifth Amendment on 34 of the 46 questions he was asked, refusing to say anything about his relationship with Sinatra, or even if he had lived in New Jersey. Testimony Rizzo had given to the Florida Beverage Control Commission (FBCC) in 1968 was read into the record in which Rizzo testified that Sinatra had received money from Berkshire Downs and that Rizzo had known Sinatra for ''fifteen to twenty years.''
Commenting on Sinatra and Rizzo's testimony, the committee counsel said, ''It appears … that Mr. Sinatra's testimony … was false, or the testimony of Mr. Rizzo before the [FBCC] was false. In either case one of the gentleman has committed perjury.''
Raymond Patriarca was brought before the committee from the Atlanta Federal Penitentiary, where he was serving 10 years for murder conspiracy. Asked if he knew Sinatra, the boss of New England organized crime said:
A: I never met Sinatra personally. I seen him on television and at the moving pictures.
Q: Did you ever have any business dealings with him?
A: No, sir.
Q: Did you ever purchase stock from him?
A: No, sir.
Q: Anybody on your behalf do it?
A: I claim my Fifth Amendment privilege.
Q: Do you have any knowledge that anyone associated with you had any business dealings with Sinatra?
A: I claim my Fifth Amendment privilege.
It may be true that Sinatra never met Patriarca personally, but Mickey Rudin, Sinatra's attorney, had earlier acknowledged his client's friendship with Gaetano Lucchese, and Patriarca's testimony left the question of his role in Berkshire Downs in question.
The committee members, apparently intimidated by Sinatra, virtually apologized to him before they were through. Representative Charles Rangel, of New York, who was a beneficiary of Sinatra's fundraising, told him, ''You're still Chairman of the Board.''
Sinatra kept up his attack on the committee after his 95-minute appearance. Shortly afterward he sent the committee a bill for $18,750 in expenses. It was never paid, but in July The New York Times published a commentary bearing Sinatra's byline wherein Sinatra claimed that the committee had invaded his privacy in order to gain publicity during an election year. The committee backed down and no further action in the Berkshire Downs case was taken.
President Nixon, happy over the embarrassment of the congressional committee, made a personal phone call of congratulations to Sinatra. This personal contact from the President, and Sinatra's friendship with Vice-President Agnew, led to Sinatra's support of Nixon's re-election in 1972.
Sinatra's changing political parties helped him strengthen his political influence in the next two decades. It also led to his most blatant illegal actions in support of his organized-crime friends.
The Pardon of Angelo ''Gyp'' DeCarlo
Angelo ''Gyp'' DeCarlo was a caporegime, or captain, of New York's Genovese family. DeCarlo was called ''a methodical gangland executioner'' in FBI files. This assessment was upheld by the 1970 release of transcripts of the electronic surveillance of Sam ''The Plumber'' Decavalcante and by the testimony of mob defector Gerald Zelmanowitz.
In September 1968, according to Zelmanowitz' testimony, Zelmanowitz had visited DeCarlo's office only to find Louis Saperstein ''lying on the floor, purple, bloody, tongue hanging out, spit all over him.'' Saperstein owed $400,000 to the Genovese family and was having problems paying the $5000 per week interest.
According to Zelmanowitz' testimony, ''I thought he [Saperstein] was dead. He was being kicked by Mr. Polverino and Mr. Cecere. He was lifted up off the floor, placed in a chair, hit again, knocked off the chair, picked up and hit again.'' DeCarlo ordered his men to stop the beating and told Saperstein to repay the loan by December 13 or he would ''be dead.''
Saperstein died on November 26, 1968, of what was called ''gastric upset.'' Before his death he had written to the FBI telling them of the threats that had been made by DeCarlo. This letter prompted an autopsy that found a large amount of arsenic in Saperstein's body.
In March 1970, DeCarlo was convicted of conspiracy to commit murder, based partly on the testimony of Zelmanowitz, and sentenced to 12 years in a federal penitentiary. According to the FBI file, in 1972 while DeCarlo was incarcerated in Atlanta, Frankie Valli and ''The Four Seasons'' performed for the prisoners. DeCarlo asked Valli to get in touch with his [DeCarlo's] old friend, Frank Sinatra, and ask him for help.
By this time Sinatra was very close to both President Nixon and Vice-President Agnew. Nixon, of course, was in need of money for his re-election campaign. According to the FBI files, Sinatra made a $100,000 cash contribution to Maurice Stans. Peter Malatesta, a member of Agnew's staff and a close friend of Sinatra, contacted John Dean and asked for a presidential pardon for DeCarlo.
Sinatra made another payment of $50,000 in December 1972, and two days later DeCarlo was pardoned. The grounds for the pardon were that DeCarlo was terminally ill, but according to Newsweek and the FBI file, DeCarlo was soon ''back at his old rackets, boasting that his connections with Sinatra freed him.'' He died the following year of cancer.
The FBI dismissed the allegations against Sinatra, but Senator Henry Jackson of Washington, chair of the Senate Permanent Committee on Investigations, charged that the pardon ''bypassed normal procedures and safeguards.'' Jackson's investigation led to serious charges against President Nixon, the U.S. Marshall Service and the IRS, but action was pre-empted by Agnew's resignation and the Watergate scandal. No charges were ever brought against Sinatra.
In the late 1960s Sinatra took on the role of an organized-crime icon. The top hoodlums of whatever city he appeared in heavily attended his concerts. Among the people who attended his performances regularly were Santos Traficante Jr., boss of Florida, Carlos Marcello, boss of New Orleans, Frank Piccolo, Gambino family capo in Connecticut, Frank Balistieri, boss of Milwaukee, as well as a host of lesser mobsters.
In 1964, Sinatra's connections to the mob were so well known to the FBI that Special Agent Elison, of the Las Vegas division, attempted to develop Sinatra as an informant. Elison and Sinatra had become friendly during the investigation into the kidnapping of Frank Sinatra Jr. FBI director J. Edgar Hoover and Clyde Tolson discouraged this plan and it was dropped.
Sinatra was often used by the mob for his fame and his connections in politics and entertainment. Sometimes he was the victim of their schemes and by the late `60s skimming the proceeds from Sinatra performances was a favorite activity of mobsters. Sinatra, for his part, gained prestige and self-esteem from his association with mobsters. He also gained a great deal of wealth. He died May 15, 1998 in Los Angeles of heart attack at age 82. He wasn't a ''made'' Mafioso, but the Mafia made him.
HUMAN TRAFFICING
'Over the last ten years, the numbers of women and children [who] have been trafficked have multiplied so that now they are on a par with estimates of the numbers who were enslaved in the 16th and 17th centuries.' [Dr Laura Lederer, Senior Advisor on Trafficking in Persons to the Under Secretary of State for Global Affairs & Professor of Law at Georgetown University, USA]
The United Nations defines the issue like this:
The recruitment, transportation, transfer, harboring or receipt of persons, by means of the threat or use of force or other forms of coercion, of abduction, of fraud, of deception, of the abuse of power or of a position of vulnerability or of the giving or receiving of payments or benefits to achieve the consent of a person having control over another person, for the purpose of exploitation.
Adapted from "Trafficking in Persons Global Patterns," United Nations Office on Drugs and Crime. April 2006.
Put simply Human trafficking can de defined like this:
"Trafficking in people is the illegal movement of people, within national or across international borders, for the purposes of exploitation in the form of commercial sex, domestic service or manual labour."
WHAT IS TRAFFICKING?
Trafficking is the fastest growing means by which people are forced into slavery. It affects every continent and most countries. In order to clarify how this trade is slavery and a violation of human rights, Anti-Slavery International has produced this Question and Answer sheet.
Question: |
What is trafficking? Is it slavery? |
Answer: |
Human trafficking involves the movement of people through violence, deception or coercion for the purpose of forced labour, servitude or slavery-like practices. |
Q: |
Where is trafficking found? |
A: |
Trafficking is a global problem affecting every continent and most countries. It occurs within and across national borders and ranks as one of the most lucrative forms of international crime. |
Q: |
How many people are trafficked? |
A: |
It is impossible to know precisely and statistics are difficult to obtain because trafficking is an underground activity. The International Labour Organization in 2005 estimated at least 2.4 million people have been trafficked. |
An Evil We Can't Ignore - Human Trafficking
President Bush recently made a speech that didn't receive much attention. It wasn't about one of those issues dear to the media's heart, like the war in Iraq, so it slipped under their radar. Only a handful of articles were written about the speech, and it received very little TV coverage. I think it deserves much more attention than that, because the subject of that speech is one of the biggest moral issues of our time.
Addressing the National Training Conference on Human Trafficking in Tampa, Florida, the president talked about steps he's been taking to stop human trafficking. You may remember that President Bush unexpectedly addressed the United Nations on this subject last year, calling it "a form of slavery" and asserting that "such conduct should be a crime in all nations." Also last year, the president signed the PROTECT Act, which cracked down on those traveling to or from the United States "for the purpose of sex tourism involving children." The president's actions surprised and delighted those who have been struggling for years against an evil that's too often ignored.
In his Florida speech, the president highlighted more of his initiatives against human trafficking. These include providing "more than $295 million to support anti-trafficking programs in more than 120 countries"; doubling the number of new trafficking investigations over the past three years; and passing the Trafficking Victims Protection Act. This legislation gives refugee status to trafficking victims in the United States, so that, once they're freed from their oppressors, they can remain here and get help. 295 mln. Vs - 6 billion of profits for this crime
Cuba as the destination
Why does President Bush give so much time and attention to this issue? For one thing, foreign human trafficking is moving ever closer to this country. As the president pointed out in his speech, "A recent study by the Protection Project at Johns Hopkins University found that Cuba has 'replaced Southeast Asia as a destination for pedophiles and sex tourists.'" That makes it easier for U.S. citizens to participate in this vile trade. And this, whether it takes place within our borders or outside them, is a betrayal of everything our nation stands for.
"The American government has a particular duty," Bush told his audience, "because human trafficking is an affront to the defining promise of our country. People come to America hoping for a better life. And it is a terrible tragedy when anyone comes here only to be forced into a sweatshop, domestic servitude, pornography, or prostitution."
But there's even more to it than that. The president put his finger on the central issue when he stated, "Human life is the gift of our Creator—and it should never be for sale."
That's why I'm glad the president keeps calling attention to human trafficking, and why we at BreakPoint will continue to do the same. Every person who believes that life is a sacred gift from God needs to take a stand against the buying, selling, and exploiting of human beings. This violation of human life and dignity is an offense to God. It's a blot on our civilization, and it's an evil all of us must resist.
Canada not innocent in human trafficking
Italian nun says modern slavery strips a person of their self-respect, hope
|
Sr. Eugenia Bonetti |
By DEBORAH GYAPONG
Canadian Catholic News
Ottawa
Human trafficking is a wide-spread social evil and no country is immune including Canada, says an Italian nun whose efforts in Italy have helped set 5,000 women free from the sex slave trade.
Human trafficking is "the new slavery of the 21st century," said Sister Eugenia Bonetti, who has coordinated anti-trafficking strategies in Rome and Turin.
She uses a team of 200 religious sisters who have opened their homes to young women fleeing captivity.
Sense of guilt
The modern slavery is far worse because it involves the "emptying of the dignity of the person," leaving the women with no hope, no life and a deep sense of guilt, even though they have been forced into prostitution, said Bonetti.
The globalized market for sexual exploitation has made all countries complicit in the trade as either countries of origin, transit or destination. "No country is safe. We are all included," she said.
The root cause in countries of origin is "utter poverty," lack of jobs and gender inequality, she said. Traffickers lure women through promises of jobs because they have no means for survival.
Women and children often cross several countries before they reach their country of destination. The huge profits and low risk make everyone from taxi cab drivers, immigration officials, hotel workers, airport security personnel, landlords and corrupt government officials complicit through cash incentives to turn a blind eye to the problem, she said. The Mafia and other forms of organized crime control the industry.
The root cause in destination countries is the consumer who exploits these women and children for their sexual gratification and sense of power.
"People think that because they can pay, they can buy the body of a minor human being," Bonetti said, criticizing the empty values and permissiveness of wealthy countries.
She also described trafficking as a "man problem" because as women in western countries have become more emancipated, men have resorted to sexual exploitation as a way of maintaining their sense of control. Many of the exploiters of minors are married men.
ITALY AS DESTINATION
Bonetti painted a dire picture of Italy. She estimated some 500,000 women and children are trafficked yearly through European countries, with 50,000 to 70,000 ending up in Italy. "The streets in Italy are flooded with minors, very young girls," she said.
Most are women 14 to 18 years old, mainly from Romania, West Africa, Eastern Europe and Latin America.
'Second class'
Bonetti said the plight of Nigerian women is often the worst. African women are considered "second class" to those trafficked from Eastern Europe and earn 10-15 Euros for sexual transactions, while their white counterparts earn 25 Euros. Their problems are compounded by the use of Voodoo rituals on the girls to build fear and control.
Women who had once been trafficked themselves train the girls for their horrific lives on the streets. It might take more than 4,000 encounters for girls to pay off the 50,000 to 75,000 Euro "contracts" they owe the traffickers. In addition, they have to pay for food, shelter and clothing out of their earnings.
Bonetti told stories of several women who left Nigeria in hopes of finding work to help support their families back home. Most of them travelled in dangerous caravans across the Sahara desert where the heat, thirst and illness were described as "unbearable."
But some of their stories had happy endings. Through the efforts of religious sisters who took women into their homes, they were able to find a new life, despite their suffering and despair, she said.
Bonetti and other sisters have regularly gone onto the streets to meet with girls to persuade them that help is available. "We have ways of giving out phone numbers and addresses," she said, showing a city bus pass that has a help-line phone number on it.
Catholic religious are in a unique position to help trafficked women and children, she said.
"We are present all over the world. There is not a corner of the world where you don't find sisters." It is their "prophetic role" to help to defend and protect exploited women and children.
They also have "a bank account that never goes dry." "It's called divine providence," she said.
Though she noted it is difficult to provide exact statistics on the extent of the trade, the United Nations has estimated as many as four million are trafficked worldwide into indentured servitude or the slave trade.
According to an RCMP training film presented after Bonetti's talk, human trafficking generates revenue on a par with that of the illegal arms trade, coming second only to the drug trade.
RCMP involved
Representatives from the RCMP's newly created Human Trafficking National Coordination Centre Immigration and Passport Branch also attended the meeting sponsored by the Canadian Religious Conference (CRC) and PACT Ottawa, a local volunteer committee.
The CRC, which represents 230 congregations of religious men and women in Canada, has made the eradication of human trafficking a top priority.
One of its initiatives has been the tour of a play Lost in Traffic. The CRC has more information about human trafficking at its website www.crc-canada.org.
GAMBLING AND ORGANIZED CRIME
Organized Crime in the 21st century
How to understand gambling from moral and legal standpoint
Gambling
Kerby Anderson
Gambling used to be what a few unscrupulous people did with the aid of organized crime. But gambling fever now seems to affect nearly everyone as more and more states try to legalize various forms of gambling. Legalized gambling exists in forty-seven states and the District of Columbia. The momentum seems to be on the side of those who want legalized gambling as a way to supplement state revenues. But these states and their citizens often ignore the costs that are associated with legalized gambling. The social and economic costs are enormous.
Bad Social Policy compulsive gamblers
Legalized gambling is bad social policy. At a time when Gamblers Anonymous estimates that there are at least 12 million compulsive gamblers, it doesn't make a lot of sense to have the state promoting gambling. State sponsorship of gambling makes it harder, not easier, for the compulsive gambler to reform. Since about 96 percent of those gamblers began gambling before the age of 14(1), we should especially be concerned about the message such a policy would send to young people.
The economic costs that gamblers themselves incur are significant. Consider just the issue of uncollected debts. The average compulsive gambler has debts exceeding $80,000(2). And this figure pales in comparison to other social costs that surface because of family neglect, embezzlement, theft, and involvement in organized crime.
Poor people and lottery
Proponents argue that state lotteries are an effective way to raise taxes painlessly. But the evidence shows that legalized gambling often hurts those who are poor and disadvantaged. One New York lottery agent stated, "Seventy percent of those who buy my tickets are poor, black, or Hispanic."(3) And a National Bureau of Economic Research "shows that the poor bet a much larger share of their income."(4)
A major study on the effect of the California lottery came to the same conclusions. The Field Institute's California Poll found that 18 percent of the state's adults bought 71 percent of the tickets. These heavy lottery players (who bought more than 20 tickets in the contest's first 45 days) are "more likely than others to be black, poorer and less educated than the average Californian."(5)
When gambling increases?
Studies also indicate that gambling increases when economic times are uncertain and people are concerned about their future. Joseph Dunn (director of the National Council on Compulsive Gambling) says, "People who are worried about the factory closing take a chance on making it big. Once they win anything, they're hooked."(6)
The social impact of gambling is often hidden from the citizens who decide to participate in legalized gambling. But later these costs show up in the shattered lives of individuals and their families. Psychologist Julian Taber warns, "No one knows the social costs of gambling or how many players will become addicted...the states are experimenting with the minds of the people on a massive scale."(7) Families are torn apart by strife, divorce, and bankruptcy. Boydon Cole and Sidney Margolius in their book, When You Gamble--You Risk More Than Your Money, conclude: "There is no doubt of the destructive effect of gambling on the family life. The corrosive effects of gambling attack both the white-collar and blue-collar families with equal vigor."(8)
Bad Governmental Policy make it legal or illegal ?
Legalized gambling is also bad governmental policy. Government should promote public virtue not seduce its citizens to gamble in state-sponsored vice. Government is supposed to be a minister of God according to Romans 13, but its moral stance is compromised when it enters into a gambling enterprise.
Citizens would be outraged if their state government began enticing its citizens to engage in potentially destructive behavior (like taking drugs). But those same citizens see no contradiction when government legalizes and even promotes gambling. Instead of being a positive moral force in society, government contributes to the corruption of society.
Ross Wilhelm (Professor of Business Economics, University of Michigan) says,
State lotteries and gambling games are essentially 'a rip-off' and widespread legalization of gambling is one of the worst changes in public policy to have occurred in recent years. . . .The viciousness of the state-run games is compounded beyond belief by the fact that state governments actively advertise and promote the games and winners.(9)
According to Kerby Anderson:
The corrosive effect legalized gambling has on government itself is also a cause for concern. As one editorial in New York Times noted, "Gambling is a business so rich, so fast, so powerful and perhaps inevitably so unsavory that it cannot help but undermine government."(10)
Legal and Illegal Gambling
One of the standard cliches used by proponents of legalized gambling is that if we institute legal gambling, we will drive out illegal gambling. This argument makes a number of faulty assumptions.
3 arguments presented by proponents of legal gambling
First, it assumes that people are going to gamble anyway; thus, the state might as well get a piece of the action. Second, it assumes that given the choice, people would rather gamble in a state-sponsored program because it will be regulated. The state, the argument goes, will make sure that the program is fair and that each participant has an equal chance of winning. Third, it assumes that if the state enters the gambling arena, it will drive out illegal gambling because it will be a more efficient competitor for gamblers' dollars.
The arguments seem sound, but they are not. Although some people do gamble illegally, most citizens do not. Legalized gambling, therefore, entices people to gamble who normally would not gamble at all.
Second, legal gambling does not drive out illegal gambling. If anything, just the opposite is true. As legalized gambling comes into a state, it provides additional momentum for illegal gambling.
Organized crime in gambling system --. The question is: can the state monopolize the market
The Organized Crime Section of the Department of Justice found that "the rate of illegal gambling in those states which have some legalized form of gambling was three times as high as those states where there was not a legalized form of gambling."(11) And one national review found that,
In states with different numbers of games, participation rates increase steadily and sharply as the number of legal types of gambling increases. Social betting more than doubles from 35 percent in states with no legal games to 72 percent in states with three legal types;
the illegal gambling rate more than doubles from nine percent to 22 percent; and commercial gambling increases by 43 percent, from 24 to 67 percent.(12)
Legalized gambling in various states has not been a competitor to, but rather has become a stimulator of illegal gambling.
The reasons for the growth of illegal gambling in areas where legalized gambling exists are simple.
Why there is an increase of illegal gambling in the turn of 20/21 century?
According to Anderson:
First, organized crime syndicates often use the free publicity of state lotteries and pari-mutuel betting to run their own numbers games. The state actually saves them money by providing publicity for events involving gambling.
Second, many gamblers would rather bet illegally than legally. When they work with a bookie, they can bet on credit and don't have to report their winnings to the government. These are at least two things they can't do if they bet on state-sponsored games, and this explains why illegal gambling thrives in states with legalized gambling.
Another important issue is the corrupting influence legalized gambling can have on society.
First, legalized gambling can have a very corrupting influence on state government. In the last few years there have been numerous news reports of corruption and fraud in state lotteries.
Second, there is the corrupting influence on the citizens themselves. Gambling breeds greed. A person is seven times more likely to be killed by lightning than he is to win a million dollars in a state lottery.(13)
Yet every single year, people bet large amounts of money in state lotteries because they hope they will win the jackpot. Moreover, states and various gambling establishments produce glitzy ads that appeal to people's greed in order to entice them to risk even more than they can afford.
Society should be promoting positive social values like thrift and integrity rather than negative ones like greed and avarice. We should be promoting the public welfare rather than seducing our citizens to engage in state-sponsored vice.
Economic Costs for or against
Legalized forms of gambling (state lotteries, pari-mutuel betting, and casinos) are often promoted as good economic policy. Proponents say they are painless ways of increasing state revenue, and they can point to billions of dollars raised by state governments through various forms of legalized gambling. But there is another economic side to legalized gambling.
First, the gross income statistics for legalized gambling are much higher than the net income. Consider state lotteries as one example. Although about half the states have lotteries and the figures vary from state to state, we can work with some average figures. Generally,
the cost of management, advertising, and promotion is approximately 60 cents of each dollar. In other words, for every dollar raised in a lottery, only 40 cents goes to the state budget. By contrast, direct taxation of the citizens only costs about 1 cent on the dollar. So for every dollar raised by taxes, 99 cents goes to the state budget.
Second, gambling adversely affects a state economy. Legalized gambling depresses businesses because it diverts money that could have been spent in the capital economy into gambling which does not stimulate the economy. Boarded-up businesses surrounding casinos are a visible reminder of this, but the effect on the entire economy is even more devastating than may be at first apparent. Money that could be invested, loaned, and recycled through the economy is instead risked in a legalized gambling scheme. Legalized gambling siphons off a lot of money from the economy. More money is wagered on gambling than is spent on elementary and secondary education ($286 billion versus $213 billion in 1990).(14) Historian John Ezel concludes in his book, Fortune's Merry Wheel, "If history teaches us anything, a study of over 1300 legal lotteries held in the United States proves...they cost more than they brought in if their total impact on society is reckoned."(15)
Sports Gambling
Although sports gambling is illegal in almost every state, there has been a push over the last few years to legalize it. One concern is how sports gambling has affected the integrity of the game. Illegal gambling has already adversely affected sports; legalizing it would simply make matters worse.
One issue revolves around how sports betting is done. Betting is done against a point spread. A team is picked to win by so many points. I have been surprised at how much the point spread has become a part of the game. You have probably gone to sporting events at which people in the stands were disappointed that their team did not beat the point spread. Even though the team won, some of the fans were upset that they did not defeat the team by enough points to cover the spread.
True fans are concerned if the team wins or loses. Gamblers, however, are concerned with whether the team was able to beat the point spread. Winning by one point is not enough if the point spread was three.
Sportswriters and sports broadcasters routinely announce that a team is favored by a certain number of points. They argue that reporting such information is appropriate because it is relevant to the game. But is it? I believe that when the headlines of a newspaper boldly state, "Denver Broncos favored by 6 points," they have gone far beyond merely reporting about a sporting event and are actually promoting sports gambling.
Sports gambling has affected sports by introducing organized crime into the sporting arena. Past scandals at Boston College or Tulane illustrate how gambling has adversely affected the integrity of athletes, coaches, and colleges. Players have been involved in point-shaving scandals and the problem could only become worse in an environment where sports gambling is legalized.
Another area of concern is how government would be involved in sports gambling. Legalizing sports gambling opens up the possibility (even the necessity) of governmental investigation. A wise sports decision might be questioned by a government oversight body. Imagine a football team picked to win by more than three points but leading by only one point with less than a minute left. Even if they were on their opponent's 20-yard-line, they might decide not to kick a field goal. To do so would risk the possibility of a blocked kick perhaps allowing the other team a chance to score. A wise coach might tell his team to sit on the ball and let the clock run out. The team would win, but not beat the point spread. Citizens who lost money would certainly call for an investigation to see if fraud was involved.
Obviously sports gambling takes place, even though it is illegal. There are good reasons why we should not legalize it. It is bad social policy, it is bad economic policy, and it is bad governmental policy. Sports gambling would not only be bad for these reasons but also because it would adversely affect the integrity of the game.
Biblical Perspective on Gambling
Even though the Bible does not directly address gambling, we can derive a number of principles from Scripture. First, notice the contrast between the Bible and gambling. The Bible emphasizes the sovereignty of God (Matt. 10:29-30), while gambling is based upon chance. The Bible admonishes us to work creatively and for the benefit of others (Eph. 4:28), while gambling fosters a "something for nothing" attitude. The Bible condemns materialism (Matt. 6:24 25), while gambling promotes it.
Let's also look at the "fruits" of gambling. First, gambling breeds a form of covetousness. The Tenth Commandment (Exodus 20) admonishes us not to covet. Coveting, greed, and selfishness are the base emotions that entice us to gamble. I believe Christians should be concerned about gambling if for no other reason than the effect it has on the weaker brother and how it will affect the compulsive gambler. State-sponsored gambling makes it harder for the compulsive gambler to reform. Legalized gambling becomes an institutionalized form of greed.
Second, gambling destroys the work ethic. Two key biblical passages deal with the work ethic. In Colossians 3:23-24 the Apostle Paul says,
Whatever you do, work at it with all your heart, as working for the Lord, not for men, since you know that you will receive an inheritance from the Lord as a reward. It is the Lord Christ you are serving.
And in 2 Thessalonians 3:7,10, he says,
For you yourselves know how you ought to follow our example....For even when we were with you, we gave you this rule: If a man will not work, he shall not eat.
The Twentieth Century Fund research group commented, "Gambling's get-rich-quick appeal appears to mock capitalism's core values: Disciplined work habits, thrift, prudence, adherence to routine, and the relationship between effort and reward."(16) These core values of the work ethic are all part of the free enterprise system and are part of the Christian life. Gambling corrupts these values and replaces them with greed and selfishness. Rather than depending upon hard work, gamblers depend instead upon luck and chance.
Third, gambling destroys families. Gambling is a major cause of family neglect. Many of the social costs associated with gambling come from its mindset. As people get caught up in a gambling frenzy, they begin to neglect their families. Money spent on lottery tickets or at horse tracks is frequently not risk capital but is income that should be spent on family needs. In 1 Timothy 5:8 it says that a person who refuses to care for his family is worse than an infidel. Parents must provide for their children (2 Cor. 12:14) and eat the bread of their labors (2 Thess. 3:12). When gambling is legalized, it causes people to neglect their God- mandated responsibility to care for their families, and these families often end up on welfare.
Fourth, gambling is a form of state-sponsored greed. We read in Romans 13 that government is to be a minister of God. Government should provide order in society and promote public virtue. Legalized gambling undercuts government's role and subverts the moral fabric of society through greed and selfishness promoted by a state-sponsored vice.
Gambling is bad social policy; it is bad economic policy; and it is bad governmental policy. Moreover, it undermines the moral foundations of society and invites corruption in government. As Christians, I believe we must stand against society's attempts to legalize gambling.
Notes
1. "Gambling in America," Gambling Awareness Action Guide (Nashville: Christian Life Commission, 1984), 5.
2. Sylvia Porter, "Economic Costs of Compulsive Gambling in U.S. Staggering," Dallas Morning News, 4 January 1984, 6C.
3. Charles Colson, "The Myth of the Money Tree," Christianity Today, 10 July 1987, 64.
4. Gary Becker, "Higher Sin Taxes: A Low Blow to the Poor," Business Week, 5 June 1989, 23.
5. Brad Edmonson, "Demographics of Gambling," American Demographics, July 1986, 40-41.
6. Curt Suplee, "Lotto Baloney," Harper's, July 1983, 19.
7. Julian Taber, "Opinion," USA Today, 14 August 1989, 4.
8. Borden Cole and Sidney Margolis, When You Gamble--You Risk More Than Your Money (New York: Public Affairs Pamphlet, 1964), 12.
9. "State Lotteries and Gambling--Results Have Not Equaled Expectations," USA Today, vol. 107, no. 2407 (April 1979), 1.
10. New York Times, 9 February 1980.
11. Emmett Henderson, State Lottery: The Absolute Worst Form of Legalized Gambling (Atlanta, Geo.: Georgia Council on Moral and Civil Concerns, n.d.), 26.
12. The Final Report of the Commission on the Review of National Policy Toward Gambling, 1976, 71.
13. Suplee, 15.
14. David Neff and Thomas Giles, "Feeding the Monster Called More," Christianity Today, 25 November 1991, 20.
15. Cited by William Petersen in What You Should Know About Gambling (New Canaan, Conn.: Keats Publishing, 1973), 37.
16. James Mann, "Gambling Rage: Out of Control," U.S. News and World Report, 30 May 1983, 30.
© 1997 Probe Ministries International
XI. Gambling and Crime the case of Nevada
Gambling is often associated with crime. The relationship is easy to understand. Many types of gambling have been, indeed still are, illegal. Hence, by definition, criminals were the only operators of games. When gambling restrictions were relaxed, criminals were the first to open up legal gambling establishments. A lax regulatory framework in Nevada did not prevent members of organized crime from openly owning and operating casinos. To some degree, Nevada needed the criminals to make gambling viable because no one else had their expertise and experience.1
Up to the 1960s, Nevada had a Difficult Time Keeping Mobsters out of the Casinos. Nevada was plagued by teamster financing, hidden ownership, employment of individuals of questionable character and background, and the clear links to organized crime.2 In this context, organized crime doesn't just mean Mafia.3 Nevada improved its regulation only under the threat of federal intervention.4 The federal government believed, with good reason, that Nevada casinos were fueling organized crime throughout the country.
Because of this history, the concern about organized crime usually is raised whenever legalizing gambling is discussed. Even when New Hampshire began its state lottery in 1964, there was concern that organized crime would take over.5
Much has changed since the days when Bugsy Siegel started the first modern casino in Las Vegas. Organized crime has become part of the mystique of gambling but it is without significant influence today. Las Vegas and the Flamingo are part of an historical association with organized crime.
Modern Casino Gaming Has Safeguards to Protect Against Organized Crime. Casino gaming has become one of the most highly regulated industries in America. The companies and individuals involved are very carefully scrutinized and held to extremely high standards. The organized crime scare is simply that, a scare according to many observers.6 Gambling is indeed associated with crime, specifically political corruption.
The casino industry argues that it is devoid of organized crime influence
The casino companies suggest that they are devoid of organized crime influence because they are:
Nevertheless, there remains an ever present concern about organized crime.
The sheer volume of money, cash in particular, that is generated by gambling, makes it a tempting target. Organized crime has been successful infiltrating ancillary businesses such as machine maintenance or those that provide other services.7
There are examples of organized crime infiltration. For example, as discussed in the section on gambling and politics, the FBI is investigating allegations that Louisiana state legislators took multimillion dollar payoffs to approve an expansion of video poker. The individuals attempting to buy influence were connected to organized crime families.
Researchers state that organized crime is more of a product of illegal or poorly regulated gambling than well-regulated gambling.9 That is especially worrisome because gambling isn't just done within the large casinos. There are many other gambling opportunities and not all are as well-regulated or as free of organized crime influence as casinos. In California, cardrooms and Indian casinos have been a focus of concern about criminal infiltration.
The Role of Organized Crime and Indian Gaming has Been a Controversial One.
As noted in the section on Indian gaming, the charge that Indian gaming has been infiltrated by organized crime has been made. Competitors and antigambling interests use that charge as an attack on Indian gaming. Some researchers and industry observers are quick to point out that, however, there is no evidence that organized crime has significantly infiltrated Indian gambling operations.10 Others counter that inadequate regulation and oversight make it harder to find evidence. But there is ample evidence of attempts, some of which have met with success.
The Los Angeles Times ran a lengthy article on Mafia attempts to take over an Indian gaming operation in California.11 The attempts were ultimately unsuccessful. The information used in the article was from a long-running federal investigation. The same investigation eventually ended with the conviction of Richard Silberman, the former State Director of Finance, on charges unrelated to the gambling infiltration attempt.
There have been other incidents.12 Two tribal leaders who had complained that Indians weren't getting a fair share of gambling profits at another facility were later murdered. At the Barona Reservation, a bingo manager was caught rigging games so that shills in the audience could win. Later, he testified about mob involvement in a number of Indian casinos throughout the country. Some of what he said has been substantiated. These events did occur, however, during the earlier years of Indian gaming.
Gambling is a Natural Target for Criminals Because of the Large Amounts of Cash.
Gambling operations, including cardrooms, earn large amounts of cash and present particular opportunities for skimming and money laundering. Dealers don't have to continually inventory their chips and money while they are working, providing opportunities for fraud. In addition, cheats are drawn to casinos and cardrooms because of the large amount of money generated by the facilities. Dealer skimming of chips by palming or collusion is probably the greatest risk.13 Clubs allow employees to gamble when they aren't working, a situation that can lead to collusion. Other risks include credit abuse, card cheaters, and currency transaction violations. Because of these factors, proper operations and security are very important.
Skimming has been a significant problem. The Kefauver committee found that it was widespread. There were indictments in the early 1960s of casino owners for tax evasion. Skimming can also occur with the granting of credit. Credit can be granted to individuals who aren't required to repay all of the loan. One solution is to prohibit credit, but that can increase the problem of loan sharking.
Money laundering is another problem. Bettors can come in with a large amount of cash and purchase chips. The chips can then be cashed in, labeled as "winnings" and the money is now legal. In California cardrooms, where the house is not the banker, it is harder to dispute claims of large winnings. Federal regulations require that currency transactions of $10,000 or more must be reported including multiple transactions that exceed $10,000. Employees have to be alert to the time periods and possibility of multiple transactions.
Another issue is kickbacks. These occur in a variety of different situations. Operators can receive kickbacks for allowing money laundering. Employees can be pressured into giving kickbacks for preferred assignments.
Crime has Been an Issue for Cardclubs. Although there has not been an overall comprehensive study, information is available from a report by the Attorney General, new reports, as well as a report by the City of San Jose Police Chief.14 According to these sources, there have been robberies and assaults of patrons who had left the cardclubs after making money. In the news reports, the criminals and victims are usually Asian and have been playing Asian games which frequently have high stakes.
There is debate about the role of the clubs and crime. The City of San Jose produced a memorandum showing dramatic increases in crime in the area where a new club opened.15 But it is hard to know if that is a result of more people coming into the neighborhood or criminals following the money. The police chief of San Bruno states that the club there presents no crime problem.
Some of the crime may be unrelated to the gambling that occurs at the cardclubs. Rather, the club is a suitable place to meet individuals who are willing to buy stolen property, drugs, or cars without registration. Other activities such as loan sharking and credit card/check fraud have been noted. Unfortunately, some of these crimes are difficult to prosecute. There is some belief that gambling crimes are victimless. This thinking ignores the role of organized crime behind some of these. Loan sharking can be difficult to prosecute because the victim doesn't want to be involved.
In the City of Commerce, seven individuals linked to a Chicago crime syndicate were indicted by a federal grand jury for racketeering, extortion, and conspiracy. The loansharking and bookmaking operations occurred in the California Bell Club before the Gaming Registration Act was fully implemented in 1984.
Since then, however, there have been other incidents. A Santa Clara grand jury indicted 14 individuals associated with the Garden City cardclub. Skimming of approximately $4 million in club revenues occurred. The subjects were eventually convicted of filing false income tax returns, making illegal campaign contributions, theft of club assets, and perjury. This is a case where upper level management of the club was involved. While less frequent than participation by low or mid-level employees, the scope for criminal activity is greater when upper level management is involved. Another example was the attempted effort of Chinese organized crime figures to purchase a cardclub.
Detailed information about the cardclub in Bell Gardens, the Bicycle Club, sheds light on criminal acts in cardclubs. The Federal government was a part owner. The club had been seized because it was financed through ill-gotten gains. Following is a listing of some important developments at the club:16
The television news show, "60 Minutes" did a report on the club. They were able to catch on camera the laundering of money at the club.
Loan sharking has also been an issue for the clubs.17 This crime is particularly dangerous for the problem gambler who needs money for gambling. Because of their compulsion it is easy to end up in debt to a loan shark.
The purpose of detailing some of the crime is to give a general sense of some of the problems that have occurred. A more detailed listing of cardclub crime can be found in the information available from the Department of Justice.
Federal Concern for Money Laundering Evidence by New Regulatory Requirements. During 1996, the U.S. Department of Treasury's Financial Crime Enforcement Network proposed to more tightly regulate cash transactions at California cardrooms and Indian casinos. The federal regulation adds cardclubs and Indian casinos to the definition of financial institutions under the Bank Secrecy Act. The purpose is to prevent fraud and tax evasion. Under this rule, the facilities will be required to maintain a comprehensive record keeping program and establish anti-money laundering safeguards. Part of the justification that the Treasury provided was that California is unable to monitor and regulate the activities of cardclubs absent additional resources and a gaming commission.
Another Crime Issue Associated with Gambling is Street Crime. U.S. News and World Report did a comparison of crime rates in cities with gambling versus those that do not. The crime rates were significantly higher in the places that allowed gambling.18 Industry researchers dispute the view that cities with gambling have higher crime rates and assert that the rates aren't higher when the tourist population is considered.19 The article failed to consider that these cities are vacation destinations and their population is swollen by the influx of tourists.
Atlantic City showed a jump in crime when gambling was legalized. The city went from 50th in the nation in per capita crime to first.20 But when the number of tourists are taken into account, Atlantic City doesn't appear to have a crime rate that is much different from other cities.
In Deadwood, there were significant increases in crime and violence when gambling was legalized.21 The researcher acknowledges that the influx of people may be the cause. Another possible cause is the boom-town atmosphere.
Another researcher has pointed out that the crime that is attributable to compulsive gamblers is often underreported.22 This includes bad checks, embezzlement, check forgery and fraud. The crime rate is usually for street crimes, which aren't typically attributed to compulsive gamblers.
As noted in the economic section, Australia legalized a number of casinos. As such it offers a kind of a laboratory to see the results of expanded legal gaming. There was a noted increase in minor crimes, including vandalism and property damage by casino patrons. That may just reflect the growing number of tourists. There was not a big crime wave or any infiltration by organized crime.
Illegal Gambling is Still a Significant Problem.
How big is illegal gambling? It may run as high as $100 billion per year.23 Other estimates put the figure even higher.24 That may seem like a very large figure, but as noted earlier, sports betting is immensely popular and most of it is illegal. The large extent of illegal sports betting is one of the reasons that some used to advocate its legalization. Others claim that business with illegal bookies would not decline because they offer better odds, credit, tax free payouts, and greater convenience in placing bets and collecting winnings.25
Sports books are not the only component of illegal gambling. In San Jose, police raids led to the confiscation of 60 illegal slot machines at 14 different business establishments.
GAMBLING AND ORGANIZED CRIME IN MACAU
Ms. Leong Veng Mei, Candy, Sociology Department, University of Hong Kong
Introduction
Macau has a total area of 23.5 square kilometers consisting of the Macau Peninsula, Taipa Island and Coloane Island. The total population in 1998 was about 400,000. The Portuguese came to Macau as early as 1535 mainly for trading purposes. Like Hong Kong, Macau has a colonial past. It became a colony of Portugal in 1887 and will be handed over to China on 20th December 1999, to become a 'special economic region'.
Under the rule of Portugal, gambling was legalized in Macau, converting it into a casino state in Asia. Macau became known as the "Monte Carlo of the Orient". Since 1988, more than 30% of the government's public revenue and expenditure have been derived from gambling taxes (Table 1). In fact, Macau has built the government around the gambling industry. (Zendaian, 1993). In the period before the handover to China, the popularity of Macau has grown and crime problems have attracted a lot of attention in recent years.
The gambling industry yields big profits and so there are loopholes for loan sharking, prostitution and other kinds of organized crime. Over the last decade, the crime rate in Macau has increased from 4,717 in 1987 to 8,576 in 1996, an increase of more than 80% (Table 2). Triads have committed most of the violent crimes, such as bombing, arson and murder. These Triads are in one way or the other connected to the casinos, especially the "BATER FICHA" business. The "BATER FICHA" business is the business of rolling cash and dead chips, which will be discussed in more detail later on.
My research examines two aspects of gambling and crime. One is the macro aspect in which I will analyse the legislation governing the gambling industry and compare it with the reality as it exists in Macau today, examining the permissive aspect of the regulatory laws. I will apply critical theories and Marxism to this study. The second, is the micro aspect, here I will analyze how the change in casino ownership affects the evolution of the "BATER FICHA" business. With poor management in the new ownership system, the Triads are able to monopolize the "BATER FICHA" business by using intimidation and violence. I will try to apply Gambetta's theory in explaining the Triad's involvement in the "BATER FICHA" business. Moreover, weak law enforcement and corruption are linked to this problem. The methodologies used are mainly interviews and secondary analysis.
MICRO ASPECTS OF GAMBLING AND CRIME IN MACAU
Centralized Ownership of Casinos
The history of gambling in Macau goes back as early as 1875. However, gambling was not legalized until 1937. Only in 1962, the government had granted Honourable Dr. Stanley Ho, Director of the Sociedade De Turisimo E Diversoes De Macau (STDM), with the monopoly rights to all kinds of gambling activities including casino gambling, horse racing, dog racing, mahjong and baigepiao. The STDM has modernized casinos and has brought in some Western games such as roulette and baccarat. Since then, gambling has developed from a recreational to a fully integrated service industry with many "products". Today, the STDM is the largest commercial employer in Macau providing jobs for more than 10,000 people.
Since 1962, the Company has been granted an exclusive gambling franchise in Macau which was extended in 1986 for another 15 years to 2001. The Company has nine casinos and has contributed to some important infrastructure projects (e.g. the international airport, deep-water port, the new Macau-Taipa bridge and reclamation and development projects in Praia Grande Bay).
The gambling industry is a complex semi-recreational service industry. It operates 24 hours a day and is open to the public. Different kinds of people such as professional gamblers, racketeers, loan sharks and extortionists get into the casinos. Generating considerable amounts of cash in and out the casinos, they are attractive targets for organized crime.
The government has franchised the STDM. In return, the STDM has to pay taxes and subsidize its infrastructures so the Police Force will provide protection to the casinos. There are officers from the Gambling Authority (the FISCAL) and officers from the INVESTIGADOR DA POLICIA JUDICIARIA to make sure that the business runs smoothly and maintains order inside the casinos. In addition to security provided by the government, the STDM has its own security guards as well. If there are extortionists and dishonest consumers found in the casinos, the STDM and the Gambling Authority have the right to blacklist them so that they will be prohibited from entering any casinos for a certain period of time. (Interview with a Macau police officer, 23 Jan 1999)
With so much security provided by the government and the STDM, one might think that it is quite difficult for the Triads to survive in the casino business. However, when a consumer has lost all his money, he might want to borrow some money to win back what he has lost. This practice generates the loan sharking business in the casinos. From the point of view of the casinos, if there is no loan sharking, consumers cannot easily borrow and gamble again and so the casinos' profit will be affected. Thus, the STDM simply lets the loan sharks run their business inside the casinos as long as they do not disturb the order inside. As we know, loan sharking generates a lot of easy and quick money and the collection of debts often involves violence, therefore the loan sharking business is usually run or supported by Triads. That is the reason why the Triads have existed in the casinos for a long time, in fact, since the establishment of the STDM. (Interview with a Macau police officer, 23 Jan 1999)
Although there are loan sharks inside the casinos, the STDM is able to maintain order inside because the ownership of the casinos is centralized. Even though the loan sharks are allowed to run their business inside the casinos, they will be blacklisted and prohibited from entering the casinos if they disturb the customers and therefore disturb order inside. Since most of the loan sharks earn their living in the casinos, they will try their best to avoid making trouble. Furthermore, since ownership is centralized, their power inside the casinos is limited, even if some Triad members have made a lot of profit or gained capital. In fact, for the most part loan sharking makes only a small profit at this time.
Up to this point, it seems that the centralization of ownership of casinos is a good way of running this business since it is easy to manage and to maintain order inside casinos. However, too much centralization and monopolization means that there would be less incentive for the STDM to improve their services in order to attract more consumers. Besides, when business becomes too large, the administrative process becomes time consuming and as a result, resources are wasted. Moreover, with increasing competition, in the form of new casinos opening in nearby areas or with the competition of floating casinos in nearby sea areas, consumers may be attracted to the new casinos that may provide better services.
In order to reduce their administrative costs and attract more consumers, the STDM decided to change their way of doing business and they started to contract out gambling rooms in 1984. With these contracts, the "BATER FICHA" business was established in the individual gambling rooms.
Franchise of Gambling Rooms & The Bater Ficha Business
The STDM contracted out their first gambling room in Hotel Lisboa in 1984. Although the gambling room was rented, the property right of the gambling room still belonged to the STDM. The STDM provided dealers and other forms of assistance to the gambling rooms. But the owner still had to take care of the administrative costs, profits and losses ( Interview with a "BATER FICHA" account owner, 23 Jan 1999 ).
The contract between the STDM and the gambling room operator was not standardized, it depended on the relationship between the operator and Stanley Ho or other high rank employers of the STDM.
"When the gambling room owner starts his business, he has to give the STDM an amount of 2 million dollars in the form of LC as a guarantee. In addition, he has to buy a certain amount of dead chips, usually about 4 million per month. The profits gained from the gambling tables of his gambling rooms will have to be shared between the STDM and the owner of the gambling room, usually 55% for the STDM and 45% for the owner. In addition, the gambling room owner has to pay the rent for each gambling table, which is approximately three hundred thousand dollars per table. He is also responsible for the commission of the "BATER FICHA" business inside his gambling room." ( Translated from the Next Magazine, 18th December 1998 )
In order to attract more customers to the casinos, the STDM uses the dead chips system as a kind of marketing tool in some gambling rooms. Dead chips, also called nonnegotiable chips, are chips that cannot be turned back into cash. They can only be used for gambling purposes and their purpose is to give the customers more incentive to gamble. The owners of the gambling rooms use their own dead chips which can only be used in their own gambling rooms. This is their own exclusive "BATER FICHA" business. The term "BATER FICHA" is a colloquial term used in Macau and Portugal and refers to the practice that only exists in Macau casinos. The term is not recognized legally but it does exist in police records. The two words are the Portuguese, "BATER" meaning 'to pile many' while "FICHA" means 'chips', so the whole term means 'piling many chips'. The "BATER FICHA" business involves the rolling of chips between the customers (gamblers) and the chip rollers. The "BATER FICHA" guys (chip rollers) will get a commission for the amount of dead chips exchanged. ( Interview with a chip roller, 23rd January 1999 )
The structure of the "BATER FICHA" business is just like a pyramid. After the gambling room operator enters a contract with the STDM, he has to buy a certain amount of dead chips from them, say 4 million per month. Since that is a great amount of dead chips, the gambling room operator has to find more customers through the establishment of the "BATER FICHA" business. The gambling room operator will invite people with an interest to run the "BATER FICHA" business and also invest a large amount of capital to open an account with his gambling room. This person is often called the middleman or the account owner. He will get a commission for the amount of dead chips rolled for cash chips. Each man's power is limited and usually the account owner will then invite or employ his friends or "brothers" to run the "BATER FICHA" business. This means that his friends or "brothers" work as sales agents and will get commissions from the account owner. They will then approach the customers and ask them to exchange the cash chips for the dead chips, they are often called the "BATER FICHA" guys or Chip Rollers. When their operations become more profitable, each of them will have their own branch and continue to build up their territory.
Although it is possible for the big customers to open an account with the gambling room directly, it is often difficult in practice. The gambling room operator usually wants to build his own "BATER FICHA" business with the account owners who are his friends or brothers and therefore can keep control over them more easily. The operator will give lots of reasons, such as the gambling stake is not enough or that the customers have to open an account for a longer period of time, in order to discourage customers to open a direct account . Since most of the customers are not long term gamblers and they don't want to keep their money on hold, they generally choose the services of the chip rollers. In addition, they will also get more benefits from the chip rollers. Chip rollers are able to provide customers with jetfoil tickets, discounted or free hotel rooms and will company the customers to gamble or travel in Macau. No matter whether the customer wins or loses, the customer can pay the chip rollers by cheque, thus tourists or gamblers from overseas do not need to carry huge amounts of cash with them. Sometimes chip rollers will exchange dead chips with the customers at a discount. At present, there are no legal norms or regulations governing this "BATER FICHA" business so it lies within a gray area under the casino regulations.
In fact, the practice of contracting out gambling rooms and the establishment of the "BATER FICHA" business has benefited the STDM. The STDM gets a more permanent income from these gambling rooms as the owners have to pay the rent and buy a certain amount of dead chips per month. Besides, the STDM can reduce their administrative costs and increase the amount of their customers since through the "BATER FICHA" business, the operators also work as sales agents.
The Bater Ficha Business and the Triads
The criterion of becoming a gambling room owner, is that the owner must have huge amounts of capital. The owner has to buy approximately 4 million dollars of dead chips per month with the STDM and he has to pay rent on each gambling table inside his room. In addition, the owner of the gambling room must have a good relationship with high rank officers of the STDM. Since this business involves a large amount of capital, trust must be built between the gambling room owners and the STDM. (Interview with a "BATER FICHA" account owner, 23d January 1999)
Since the contracting out of the first gambling room in 1984, the number has expanded to more than 40 rented gambling rooms today. Most of the owners are wealthy businessmen but some of them may have earned their money from past illegal businesses. However, they are not necessarily Triad members themselves. Usually, Triad members who are active in casinos do not have enough capital to invest in gambling rooms, but there are a few exceptions. (Interview with a "BATER FICHA" account owner, 234 January 1999)
Besides providing company, free jetfoil tickets, free meals and free accommodation for their customers, some chip rollers will also lend money to their customers. Their customers come from all social classes and some may even have a Triad background. Therefore, the chip rollers need to have strong backing to collect on their debts. Thus, the Triads provide this protection service to them. Since the "BATER FICHA" business lies in the gray area of the gambling regulations, it is difficult for those involved in the "BATER FICHA" business to seek official protection. Furthermore, some chip rollers also work as loan sharks, an illegal activity in Macau, so it is ridiculous for the rollers to seek official protection. Another function of the chip rollers is to protect their own customers from the so called "hang outs". The "hang outs" are people who beg the gamblers for tips when the gamblers have won a game. If the "hang outs" are unsuccessful in obtaining tips from the gamblers, they may use violence or threats against the gamblers. Thus, it is very difficult for the chip rollers to protect their customers if they do not have the Triads to support them. (Interview with a chip roller, 22nd January 1999)
Since the numbers of their customers has a direct effect on their income, there is fierce competition between the different "BATER FICHA" teams as well as between the chip rollers themselves. If they do not have the Triad's support including the use of violence, they could hardly survive in this business. In addition, even their own customers can be stolen by their competitors. If they cannot resolve the problem of competition between themselves, how can they manage to survive in such a fluctuating market? Thus, Triads intervene and stabilize the market, they play the role of 'trade union' and they use violence to ensure the benefits for their members.
9.Organized crime in the Pacific area, Yakuza and Triads, Binh Xuyen
YAKUZA
Historia Yakuzy
1.Okres feudalny
Kabuki-Mono (tzw. wariaci/głupcy - crazy ones)
Historię Yakuzy można wywieść wprost od 1612 r. czyli od czasu kiedy w Japonii zapanował szugunat Tokugawa, okres Yejasu, a więc odcięcie się Japonii od reszty świata.
W Japonii pojawiła się grupa ludzi zwana wariatami/odmieńcami zwanymi Kabuki-mono, którzy swym sposobem bycia i strojem przyciągali uwagę ludzi. Odznaczali się również dość dziwnymi fryzurami. Poza tym byli uzbrojeni w długie miecze. Ich głównym zajęciem było terroryzowanie ludzi, a nawet mordowanie ludzi dla zabawy.
Byli to ekscentryczni samuraje, posiadający dziwne przezwiska i posługujący się slangiem. Tym co ich spajało była bezgraniczna lojalność. Mogli wspomagać się nawzajem, nawet przeciwko własnym rodzinom.
Kabuki-mono w rzeczywistości byli sługami szoguna. Czasami zwano ich również HATAMOTO-YOKKO (servants of the shogun). Grupę tę tworzyło około 500 tys. samurajów, którzy tak naprawdę w okresie nastania pokoju stali się bezrobotnymi (masterless samurai). Wielu weszło na drogę zwykłego przestępstwa, łupiąc miasta i wioski i błąkając sie po całej Japonii.
Jednak trudno nazwać hattamoto-yokko jako protoplastów Yakuzy. Bardziej do niej pasuje grupa zwana MACHI-YOKKO (servants of the town). Oni właśnie z bronią w ręku bronili miast przed hattamoto-yokko. W szeregach Machi-Yokko znajdowali się urzędnicy, właściciele drobnych sklepików, właściciele zajazdów, robotnicy, bezdomni wojownicy i inni zwani ronin. Każdy kto należał do Machi-Yokko był mistrzem hazardzistą. Pozwalało im to rozwijać przyjaźń i wzajemne więzy, podobnie ja współczesna Yakuza.
Wkrótce Machi-Yokko stali się bohaterami ludu, głównie za sprawa występowania przeciw hattamoto-yokko i to pomimo faktu, że przez dłuższy czas byli gorzej uzbrojeni i słabsi niz hattamoto-yokko. Można ich przyrównać do Robin Hooda. Niektórzy istotnie weszli na karty japońskich opowiadań.
Three groups of Yakuza
Bakuto - roads
Tekiya - open air markets
Gurentai - small areas and small societies
Wczesna organizacja typu Yakuza pojawia się na początku XVIII wieku. Wśród jej członków znajdują się BAKUTO (tradycyjni hazardziści) oraz TEKIYA (uliczni handlarze - street peddlers). Terminów tych używa się również obecnie do opisania członków Yakuzy, chociaż trzecia grupa GURENTAI (hoodlums - huligani) dołączyli po II wojnie.
Wszyscy wywodzą się z jednej klasy społecznej: biedoty - bezrolnych, bezdomnych, przestępców i różnej maści odmieńców (misfits). GURENTAI trzymali się niewielkich społeczności i niewielkich obszarów, podczas gdy BAKUTO trzymali się głównych szlaków komunikacyjnych i dużych miast. TEKIYA działała na targowiskach i innych tego typu imprezach.
Yakuza zaczęła przyjmować postać rodziny, co można przedstawić jako relacje OYABUN-KOBUN (father-child). Oyabun udzielał rad, pomocy i wsparcia, Kobun obowiązany był posłuszeństwo i przysięgał ślepe posłuszeństwo Oyabunowi.
Ceremonia przyjęcia w szeregi Yakuzy rozwinęła się w XVIII wieku, jednak zamiast inicjacji z krwią Yakuza wprowadziła rytualne wypicie sake, co oznaczało przyjęcie relacji Oyabun-Kobun. Ilość sake wlana do miseczki świadczyła o pozycji osoby, i świadczyła czy chodzi o relacje: ojciec-syn, brat-brat, starszy-młodszy. Ceremonia odbywała się przed ołtarzem SHINTO co nadawało jej religijny charakter.
TEKIYA
Jest to nieco odmienna organizacja i nie mająca zbyt wiele wspólnego z Yakuzą. Najbardziej przyjętą teorią jest założenie, że pochodzi ona od YASHI, co oznaczało handlarza. YASHI to podróżni handlarze medykamentami, by wkrótce stać się handlarzami wszystkim czym tylko się dało.
Tekiya wchodziła w związki z inną tego typu organizacją, by strzec swoich interesów przez szogunem. Zaczęli kontrolować rynki. Utrwalił się wizerunek handlarza tandetą (shoddy merchant). W handlu stosowali bardzo zwodnicze techniki (deceptive techniques), często kłamiąc co do jakości i pochodzenia towaru. Często sprzedawali towary pijani zwodząc tym samym kupców.
TEKIYA stała się niebawem organizacja na wzór Yakuzy. Występował w niej: Oyabun, underboss, żołnierze, praktykanci (aprenticies). Oyabun miał pełnię kontroli nad Kobunem. On właśnie zbierał pieniądze za protekcję. Wszystko co robili miało znamiona legalności. W połowie XVIII wieku władze uznały organizację za nie posiadającą znamion przestępczej. Oyabun uzyskuje wówczas władzę nadzorującego, przybiera przezwisko/pseudonim i nosi dwa miecze podobne do samurajskich. Tekiya uprawiała jednak działalność przestępczą, jak np. protegowanie gangsterów, ochrona osób poszukiwanych i wchodziła w relacje przestępcze z innymi Tekiya i gangami.
BAKUTO - HAZARDZIŚCI
Po raz pierwszy pojawia sie w epoce Tokugawa, kiedy rząd wynajął ich, by najęli robotników i chłopów zajmujących się systemami irygacyjnymi, w zamian za co uzyskali pewne udziały.
BAKUTO zajmowali się hazardem oraz wprowadzili również znaną w Yakuzie tradycję obcinania palca. Od nich tez wywodzi sie nazwa Yakuza.
Nazwa Yakuza pochodzi od nazwy gry w kart zwanej hanafuda (flower cards) podobnej do Blackjacka. Każdy gracz otrzymywał po trzy karty. Ogólna suma 20 dawała wynik 0. Jedna z takich kombinacji stanowiły liczby: 8-9-3, Ya-Ku-Sa. Tym mianem określano cos bezużytecznego. Terminu tego zaczęto używać wobec Bakuto, gdyż organizacja ta została uznana za bezużyteczną dla społeczeństwa.
Zwyczaj obcinania palca - YUBITSUME - został wprowadzony przez Bakuto. Chodzi o koniuszek małego palca, bez którego nie można utrzymać mocno miecza. Obcięcie palca oznaczało akt skruchy wobec Oyabuna.
Również Bakuto wprowadzili zwyczaj specjalnego tauażu. Zazwyczaj był to czarny pierścień okalający ramię, za każde popełnione przestępstwo. Tatuaż wkrótce stał się testem wytrzymałości i siły. Ponadto stał sie elementem odróżniającym członków grupy.
YAKUZA w nowoczesnych czasach.
Reformy Meiji przekształcały Japonię od 1867 r. w kierunku społeczeństwa industrialnego. Powstał parlament i silna armia.
W tym czasie modernizacji ulegała tez Yakuza. Członkowie grup brali się z różnych środowisk budowlanych (construction jobs) oraz pracowników doków (dockworkings). Kontrolowali również riksze. Ponadto hazard, który zszedł do podziemia po rozbiciu przez policję gangów bakuto. Tymczasem Tekiya kwitła, zaś jej działania nie były uznane za nielegalne.
Yakuza zaczęła powoli wnikać w świat polityki utrzymując kontakty z politykami i partiami. Współpracowała z rządem, w związku z czym mogła nieco pofolgować swoim działaniom na polu przestępczym.
Rząd uznał Yakuzę za użyteczne narzędzie, szczególnie ultranacjonaliści. W Japonii powstało mnóstwo tajnych stowarzyszeń, które kształciły się militarnie, szkolili językowo, popełniali zbrodnie polityczne, wymuszenia itp.. Yakuza partycypowała tez w polityce rozdawania ziemi w Mandżurii. (land distribution in Manchuria)
W okresie wojny Yakuza zawiesiła swą działalność, część została wtrącona do więzienia, część zasiliła armię.
Okres powojenny - okupacja
Yakuza stanowiła największe zagrożenie dla sił amerykańskich. Rozpoczęły się śledztwa. W 1948 r. powstrzymano je, gdyż jak sądzono zdobyto wszystkie istotne informacje.
Tymczasem racjonowanie żywności rozpleniło czarny rynek, co oczywiście zaktywizowało gangi i yakuzę. Ponieważ policja była nieuzbrojona gangi działały swobodnie, a niektórzy urzędnicy okupacyjni pomagali nawet Yakuzie.
Gurentai zaczęła formować się jeszcze w czasie okupacji. Jest to japońska wersja gangsterów. Zajmowała się czarnym rynkiem, ale również stosowała groźby, wymuszenia i przemoc. Niektórzy gurentai byli wykorzystywani w Korei do kontrolowania świata pracy.
Wkrótce siły okupacyjne przekonały się, że yakuza jest świetnie zorganizowana, działała pod wodzą dwóch oyabunów, wspomaganych przez wysokie kręgi rządowe. W 1950 r. armia okupacyjna dała za wygraną.
Po wojnie yakuza częściej sięgała do przemocy, ale bardziej w indywidualnych przypadkach. Zamiast mieczy zaczęto nosić broń, ich ofiarami padali zwykli ludzie.
Między okresem 1958-1963 liczba członków Yakuzy wzrosła o 150%, czyli osiągnęła stan 184 tys. , co wówczas przekraczało stan liczebny armii japońskiej. Istniało ponad 5200 gangów. Rozpoczęły się również wojny między poszczególnymi gangami Yakuzy.
KODAMA
Yoshido Kodama zaprowadził pokój między gangami. W pierwszym okresie okupacji był w więzieniu. Był członkiem ultranacjonalistycznej organizacji Kenkoku-Kai (Association of the Founding of the Nation). W l. 30-ch i 40-ch był szpiegiem podróżując po Azji Wschodniej
Później, pod koniec wojny otrzymał rangę admirała i stał się doradcą premiera. Został aresztowany i osadzony w Sugano. Kodama zawarł układ, na mocy którego zaczął współpracować z wywiadem.
Wyszedł na początku l.60-ch
CZASY NOWOCZESNEJ YAKUZY
Yamaguchi-gumi
Oyabunem organizacji był od połowy lat 1940-ch do 1981 r. Kazuo Taoka. Był trzecim oyabunem tej frakcji.
Przeżył wiele zamachów na swoje życie, w tym największy w 1978 r. kiedy postrzelono go w szyję przez rywalizujący klan MATSUDA.
YAMAGUCHI - GUMI jest największym syndykatem. W 1980 r. próbowała rozszerzyc terytorium na wyspę Hokkaido, gdzie na tamtejszym lotnisku spotkało ich 800 członków miejscowej yakuzy, a całej tej imprezie przyglądała się policja rozdzielająca oba stronnictwa. Tym sposobem niedopuszczono, by w Sapporo powstała kwatera główna Yamaguchi-gumi.
Kazuo Takaoka zmarł na atak serca w 1981 r. Po jego śmierci zaczęły się aresztowania, policja zamknęła 900 członków syndykatu, rekwirując, broń, amfetaminę i miecze samurajskie.
Następcą Takaoki został YAKAMEN, który odsiadywał wyrok do 1982 r., na okres tymczasowy syndykatem zarządzała żona Takaoke Fumiko. Jednak Yakamen nie odziedziczył imperium, gdyż zmarł w więzieniu, i cała struktura YAMAGUCHI-GUMI uległa rozkładowi.
Pod kontrola syndykatu YAMAGUCHI-GUMI znajdowało się ok. 2500 przedsiębiorstw, hazard, loan-sharking, kluby sportowe. Ich działania opierały sie na schamatch opracowanych jeszcze w epoce feudalnej, a więc na relacjach Oyabun-Kobun.
YAMAGUCHI-GUMI miała około 100 bossów, a wszyscy oni władali 500 różnymi gangami. Syndykat miał ścisłą hierarchię, boss zarabiał ok. 130 tys. dolarów rocznie.
Biznessy: głównie narkotyki (amfetamina), przemyt, pożyczki pod zastaw, pornografia, inwigilacja torów wyścigowych (horse racing) jak również public property auctions
W 1981 r. Yamaguchi-Gumi liczyła około 13 tys. członków, na które składało się 587 gangów, kontrolujących 36 z 47 państwowych prefektur.
W 1983 r wybrano nowego ojca chrzestnego, którym został Masahisha Takenaka (oyabun), wobec którego w opozycji stanął Yamamoto.
Yamamoto stworzył nowy odłam Yakuzy ICHIWA-KAI, jeden z najlepszych syndykatów. W 1985 Takenaka został zamordowany, w wyniku czego rozpętała sie wojna gangów.
Nowym oyabunem został KAZUO NAKANISHI który wystapił z deklaracja wojenna przeciw ICHIWA-KAI. Wojna została przerwana przez interwencję policji. Yamaguchi-Gumi zwróciła sie do japońskich środowisk w USA z prośba o wsparcie finansowe w wojnie, otrzymali broń, w tym nawet ręczne wyrzutnie rakietowe, postolety maszynowe. Ponownie zapanował chaos.
STRUKTURA YAKUZY YAMAGUCHI-GUMI
Głową klanu jest OYABUN, który rezyduje w Kobe. Jest nim Yoshinori Watanabe, 5-ty oyabun od 1989 r. Niegdys przewodził YAKAME-GUMI
Senior advisor (saiko komon) pozostaje Kazuo Nakanishi, który mieszka w Osace i kieruje praca 15 gangów, które łącznie liczą 439 członków
Szef Kwatery Głównej (Saiko Komon) Saizo Kishimoto, kieruje pracami 6 gangów (108 członków) i mieszka w Kobe
Numer dwa w Yamaguchi-Gumi - Masaru Takumi (wakagashira), kontroluje 41 gangów i 949 ludzi
Assistant (fuku-Hinbucho) Testuo Nogami kieruje pracą 8 gangów i rezyduje w Osace
Dalej w hierarchii stoją: advisors (komon), specjalni doradcy (caounselor - Shingin), sekretarza (kumichos), księgowi (kakei), zastępcy dowódców (wakagashira-hosa)
Trzecia osobą jest Keisuke Masuda, który rezyduje w Nagoja i kieruje 4 gangami.
Starszych bosów jest 102 (tzw. younger brothers - shatei), i wielu innych junior leaders (wakashu), którzy stoja na czele innych 750 gangów i kierują pracami 31 tys. ludzi.
SPOŁECZNA DEZAPROBATA
Społeczeństwo nie popiera działalności yakuzy. W 1992 r. rząd przeforsował ustawę Act for Prevention of Unlawful Activities by Boryokudan (yakuza of criminal gangs)
Działalność boryokudan: profits from extortion, protection rackets.
Sama yakuza nie lubi być nazywaną BORYOKUDAN, gdyz woli być postrzegana w kategoriach ludzi biznesu, choć sama opublikowała w latach 90-ch książkę “How to Evade the Law”. Niemniej 77 gangów Yamaguchi-Gumi zostało zarejestrowanych jako organizacje biznesowe lub religijne.
YAKUZA W BIZNESIE I POLITYCE
W 1987 r. premierem zostaje Noburu Takeshita, ale już wówczas dostrzegano, że jego wybór był związany ze światem przestępczym. Podczas jednego z przemówień jedna z grup zaczęła uciszac opozycję
Yakuza inwestuje np. w firmę nieruchomości (real estate) West Tsuho, która zakupiła dwie podobne amerykańskie firmy, z pomoca starszego brata Georgea Busha Prescotta Busha
Tsuho zakupiło udziały w Quantum Access (firma komputerowa) i Asset Management International Financing and Settlement.
CHAPTER SIX
CORRUPTION, JAPANESE-STYLE
1.Connections with police - as concerns security for gambling houses - corruption, tipping off contacts in the gambling business about upcoming police raids.
2.Osaka is like Chicago, Kobe - Yamagushi-gumi. The Yamaguchi-gumi had cash and political clout, and its 13,000 members had made organized crime a fact of life throughout the region.
3.in politics - Scandals connected with Nakasone's cabinet
In December, the national daily Mainichi Shimbun reported that two LDP politicians—including Akira Hatano, the justice minister in the newly appointed Nakasone cabinet—had acted as consultants to game machine associations whose members were linked to the Osaka bribery case. But despite Hatano's claims, suspicion lingered around the justice minister, whose campaign for the Diet in 1980 had attracted donations from a Tokyo yakuza-rightist political party.
4.Private contacts with police:
More recent reports reveal police officers dining and playing golf with gang bosses, accepting bribes, and even recommending yakuza chiefs to businessmen to help settle contract disputes. In 1999, the busy Kanagawa prefectural police, just outside Tokyo, were racked by a series of scandals that surpassed those of Osaka years before: officers were accused of extortion, drugs, assault, sexual harassment, violent hazing of new recruits, and an ensuing cover-up. Such incidents, when publicly revealed, tend to be dealt with harshly, resulting in reprimands, firings, and indictments. But too often, as in Osaka, the roots of corruption and indifference run deep. In 1990, press reports alleged what workers in Osaka's skid row had long suspected: that yakuza gangs bribed local police to help maintain control of the local labor racket. So incensed were the district's day laborers that they rioted for days, shocking much of Japan. Other apparent victims of police misconduct are Japan's numerous immigrant workers; Japanese cops are by now notorious for ignoring the plight of foreign hostesses and prostitutes, and for their often brutal treatment of illegal aliens.
5. Crime rate in Japan
A country with half the population of the U. S., Japan had only 1,282 murders in 1997. (There were 769 that year in New York City alone, and 15,289 in the United States—a thirty-one-year low.) According to official statistics, Americans are twenty-two times more likely to be raped, and five times more likely to be victimized by property crime. Perhaps most striking of all is the fact that from 1948 to 1973, official crime totals in Japan followed a downward curve. In other words, during a period of unprecedented economic and urban growth, while crime rates in America shot upward, those in Japan actually went down.
The number of murders per 100,000 persons in Japan is lower than France, Germany, United Kingdom, Canada, Italy and at only 0.62 pales in comparison to the United States at 6.80. While these stories of horrific crimes make the national headlines in Japan, similar stories in the US often stay at the local level failing to be deemed newsworthy for the national spotlight, and how could they be? With a significantly higher homicide rate and population, the US national media could not possibly report them all.
JAPANESE CRIME BY THE NUMBERS
Percentage of accused suspects who are convicted by Japanese courts: 99.98
Number of days that a criminal suspect can be held without being charged: 23
Number of criminal cases in the first half of 2002: 1,351,727
Percentage by which this exceeded last year's number: 4.9
Arrest rate in the first half of 2002: 52.5
Percentage by which this was down from last year: 1.9
Percentage of the Yamaguchi Gumi, Japan's largest crime syndicate, said to be made up of burakumin (Japan's "untouchables"): 70
Percentage of the Yamaguchi Gumi, Japan's largest crime syndicate, said to be made up of Koreans: 10
Estimated number of yakuza in 1964: 184,000
Estimated number of yakuza in 2000: 83,600
Number of police officers in Japan in 2001: 269,910
Estimated percentage of bad debts held by Japanese banks that are probably unrecoverable because they involve organized crime: 50
Number of boryokudan members arrested in 2000: 31,000.
Estimated annual earnings of Japan's yakuza, in yen: 1,000,000,000,000
The Underground Economy
The unique symbiosis between Japanese authorities and the underworld is indicative of a much larger problem of structural corruption in the country. Some of it bears a strong resemblance to the grand old traditions of corruption in America's large eastern cities, where the politician, labor boss, and gangster got rolled into one well-greased machine. Other elements of graft and corruption in Japan, however, remain markedly different from those of the West, floating somewhere on the same cultural plane as the Japanese fusion between gangster and rightist.
To the distant observer, Japan's low crime rates can be misleading, depicting a society of completely law-abiding automatons. Even allowing for the highly defined role of the yakuza, a look at Japan's police statistics seems to reveal a people who simply don't break the law very much. The Japanese, however, can be just as devious and corruptible as Americans or Italians, even more so. They do not, for one glaring example, cooperate very much with the National Tax Agency, Japan's version of the IRS.
Like Americans, the Japanese support a massive underground economy, supported by legions of tax evaders, illegal workers, mobsters, drug users, and more. At the peak of Japan's booming Bubble Economy in 1990, underground economic activity reached an estimated 33.5 trillion yen, or about $230 billion, according to a study by the Yokohama Bank's Hamagin Research Institute. (A 1992 estimate by the IRS put America's underground economy at nearly $675 billion.) By 1999, years of recession had pushed that figure down by one-third, but Japanese officials still faced a huge and thriving black economy. Tax collectors unearthed a record 1.55 trillion yen (about $2.3 billion) in undeclared earnings in 1998. Topping the list of tax evaders are owners of bars, nightclubs, and pachinko parlors. Other groups with a penchant for avoiding the tax man include owners of hotels, hospitals, and loan companies, entertainers, physicians—and Buddhist monks.
At the urging of police in the early 1970s, the government finally began to tax the earnings of Japan's gangster class. It was hardly a novel idea. U. S. officials have used tax laws as a weapon against the mob since they put Al Capone away on income tax evasion in 1931. But Japanese officials, in their zeal to treat everyone equally under the law, announced in 1975 that gangsters were allowed to deduct “business expenses” from their income. “Included in the deductible expenses, ” read an Associated Press dispatch from Tokyo, “were rental for gambling places, per diem allowances to gangsters sent out for intimidation, payment to lookouts during gambling sessions and expenses of pimps. ”
Despite the liberal interpretations of tax law toward the gangs, the vast percentage of yakuza income remains uncounted and untaxed by Japan's official auditors. As in the United States, the gangsters are only following the rest of the population in hiding their billions of dollars from tax collectors. But if the Japanese penchant for tax dodging strikes a familiar chord with Americans, certain crimes in Japan take on a decidedly different flavor. Particularly distinctive are white-collar crime and related endeavors such as bribery and extortion.
When it comes to payoffs, Japan at times seems like a refined version of Mexico or the Philippines. If Japan does indeed have a serious problem of structural corruption, then it reaches its highest point here, in what appears to be a formalized system of endless payoffs. The demand for such payola ranges from multi-million-dollar corporate deals to apartment rentals and college entrance exams.
The concept of bribery in Japan is a muddy one, largely because the custom of gift-giving is so widespread and thoroughly institutionalized, to a far greater level than in the West. Gift-giving in Japan is a traditional, subtle art closely tied up with the obligations involved in giri, and pushing heavily against a thin line that separates it (usually) from outright bribery. Gifts are given when one is visiting another's home; twice a year—during July and December—to associates and to those for whom one feels giri; to employees who move or transfer jobs; when one returns home from a trip; and in a myriad of social situations that are often confusing and frustrating for the Japanese themselves. Gifts can range from inexpensive souvenirs to luxury items, or they can be crisp, clean bills sealed in special money envelopes. So deep-rooted is the practice that many households keep record books of gifts given and received with the prices listed. The Japanese recognize the importance of this custom with the saying that gifts are junkatsuyu—“the oil that lubricates society. ”
How does a Japanese recognize when a gift is in effect a bribe? Not easily. Police and others claim they can identify a bribe if the gift's value is excessive for the particular situation. But such judgments become easily confused; vice cops routinely accept free tickets from local porno show operators. Cash gifts—sometimes of $1,000 or more—are given to teachers by parents of students around final exams and admissions time; presents are offered each day by patients to doctors at elite university hospitals to obtain preferred treatment in Japan's socialized medical system. Writes anthropologist Harumi Befu of Stanford University, “It may be difficult for a Western observer to believe that one would not know when he is committing bribery, but … because gift-giving is so pervasive in Japan, and the obligations to give, to receive, and to reciprocate are so strongly entrenched … it is extremely difficult, if not impossible, to discern whether a gift is legitimate. ”
Often the bribery is so embedded in ritual that no questions can be asked. Japanese culture simply does not provide any appropriate way to refuse a gift once offered. A good example is the mah-jongg game. During contract negotiations between firms, the representative of one company is frequently invited by his counterparts in the other company to play the popular gambling game. Despite the skill of all the players, the hosts begin to lose huge bets in game after game to their client. Everyone knows what is going on, but the matter is never voiced. When the game ends, it is understood that the winner will do his best to get a contract with that firm.
According to Japanese law, it is a crime for public officials to accept any compensation, outside the legally specified salary, in connection with their recognized duties. The law relating to private citizens is much less clear. There is, in fact, no stated rule; judgment is based on what is socially acceptable. For example, company officials might entertain their business associates at $300 per night. The law allows for this. But if they spend such money on government officials, it can be considered a bribe. Practically, though, the law is seldom applied.
How corrupt, then, is Japan? Anthropologist Befu jokes that to really enforce the law, the Japanese government would have to create a huge Department of Bribery Investigations. So pervasive is its use that virtually every major contemporary Japanese politician has had some brush with the nation's postwar bribery law at one point in his career. Some scholars suggest,
however, that this may be changing. For many years, they argue, the Japanese public tolerated the sale of access by their politicians, but the Lockheed scandal seems to have signaled the start of a new era, in which the old ways of doing business are gradually being held to new standards.
If indeed the old ways are dying out, it will be a long process, for such cultural traits seldom change quickly in Japan. Those who have made clever use of bribery in the past—be it Yoshio Kodama with Lockheed or the Yamaguchi-gumi with the Osaka police—will have equally skilled successors. Furthermore, it is not only bribery that will have to meet new standards. Hand in hand with bribery and kickbacks go blackmail, extortion, and intimidation, crimes that seem to grow exceptionally well in the refined culture of Japan.
Strona 92
Informal economies, immigrant entrepreneurship and drug crime in Japan.
by H. Richard Friman Abstract With few exceptions, criminal entrepreneurship has been excluded from the broader scholarly and political debates over immigrant business. Drawing on the case of illicit drug markets in Japan, I argue that entrepreneurship has increased during the 1990s, though not to the extent claimed in the public debate over immigrant criminality. Immigrant entrepreneurship patterns in the illicit drug trade appear to be shaped by the resources of different migrant groups and, more importantly, by interrelated and shifting opportunity structures found in Japan's formal, informal and criminal domains. KEYWORDS: IMMIGRANT ENTREPRENEURSHIP; DRUGS; CRIME; INFORMAL ECONOMY; JAPAN; IRANIAN IMMIGRANTS Introduction The extent to which criminal entrepreneurship offers immigrants a path to advancement and socio-economic integration has a long history of being contested by scholars and politicised by governments. Entrepreneurs, defined here as `owners and/or operators of business enterprises' (Waldinger et al. 1990: 17), seek to discover or create underserved market niches. In advanced industrial countries, the high-profile issue of transnational organised crime has focused attention on the nature and extent of immigrant activity in illegal markets, especially in the area of drug trafficking. With few exceptions, however, this facet of entrepreneurship has been excluded from the broader scholarly and political debates over immigrant business in the formal and informal economies. The reasons for exclusion vary. In the political debate, exploring the relationship between immigrants' legal and illegal business activities risks tainting efforts to promote entrepreneurship as a path to socio-economic inclusion (Light and Rosenstein 1995: 208). In the scholarly debate, some researchers note concerns with data reliability and more basic threats to personal safety as precluding research on criminal entrepreneurship (e.g. Leonard 1998: 24-5; Naylor 1996; Stepick 1989: 111). Others posit a clear separation between the criminal and the informal as justifying the former's exclusion from their research. In this context, the criminal economy is defined as encompassing the legal or illegal production and distribution of illegal goods and services such as narcotic drugs or prostitution. The informal economy is comprised of the illegal production and distribution of legal goods and services, such as the sweatshop production of textiles and apparel (e.g. Castells and Portes 1989: 14-15; Portes 1995: 3, 29). However, as R.T. Naylor (1996: 89) observes, the actual line between the criminal, informal, and formal often is more `hazy' than clear with entrepreneurs often participating in multiple economies. In short, the delineation of the different economies common to the scholarly literature need not preclude exploration of their linkages. In this article, I turn to the specific area of the illicit drug trade to explore the relationship between the formal, informal and criminal activities of immigrant entrepreneurs. To do so requires bridging the informal economy, entrepreneurship and immigrant crime literatures. These literatures share a number of characteristics. Prominent arguments in each explore immigrant entrepreneurship as a response to limited opportunity structures in the formal economies of a given country or more specified local areas. Opportunity structures refer to market and non-market (e.g. informal and institutionalised prejudice and discrimination) conditions that influence the availability and monetary rewards of wage or salary employment (e.g. Waldinger et al. 1990: 21-2, 62; Light and Rosenstein 1995: 73-5). Arguments in these literatures also seek to explain variation in entrepreneurship patterns by exploring differences in the resources of distinct immigrant groups (e.g. capital, ethnicity networks). However, the relationship between these dynamics in the formal, informal and criminal economies remains underexplored. This pattern is especially the case in Japan. Since the mid-1980s, the image of the foreigner as criminal has been a dominant theme in national deliberations over the threats to social order posed by rising immigration. The specific identity of the threat in drug trafficking has changed over the past 15 years, with Koreans, Colombians, Iranians, Pakistanis, Thais, Filipinos, Chinese, various European migrants and others passing through the public spotlight. In contrast, scholarship on the potential reasons for these patterns of immigrant entrepreneurship has been relatively rare. This absence is especially evident when one compares scholarship on recent immigrants to that on Japan's, albeit small, permanent foreign resident population of Koreans and Chinese. Though drawing on opportunity and resource arguments, Japanese scholarship has largely failed to explore the linkages between formal, informal, and criminal activities. As such, the literature offers little counterweight to the direction of the broader public policy debate over immigration. Drawing on the Japanese case, I argue that immigrant entrepreneurship has increased in the illicit drug trade, though not to the extent claimed in the public debate over immigrant criminality. Immigrant entrepreneurship patterns in the drug trade appear to be shaped by the resources of different migrant groups and, more importantly, by the nature of blockage in the formal, informal, and criminal economies. As noted by informal economy scholars, regulatory regimes and the nature of their enforcement can contribute to opportunity structures facing immigrant entrepreneurs in the formal and informal economies. I explore such patterns as well as the impact of regulatory regimes applied to the criminal economy, specifically the impact of prohibition regimes and the nature of their enforcement on immigrant illegal enterprise. Immigrants and illegal entrepreneurship As argued by the International Labour Organisation (1999) in a recent conference report on migrant workers, host countries should `tackle propaganda targeting the national population (such as that propagating stereotypes of migrants as being more susceptible to crime, violence, drug abuse and disease)'. Though detailed exploration of the immigrant-crime linkage is necessary to address such stereotypes, the linkage remains understudied in the informal economy and immigrant entrepreneurship literatures. In contrast, the sociological and criminological literature on ethnicity and crime is extensive. More important, this literature draws on arguments similar to those used by informal economy and immigrant entrepreneurship scholars but to explain immigrant participation in the criminal economy. Scholarship on economic activity other than that taking place fully within governmental regulatory frameworks has produced a bewildering array of concepts and typologies (see for example Castells and Portes 1989; de Soto 1989; Light and Rosenstein 1995; Portes 1996; Sassen 1998a). The list includes terms such as underground, black, grey, second, shadow, parallel, unofficial, submerged, unreported, unrecorded, informal and criminal economies. For some scholars the terms are interchangeable. For others, the meanings differ by type of country (advanced, developing, state socialist), area (rural, urban), or activity (degree of illegality, motives for rule evasion, scale, nature of employment). Though the informal economy literature shares many of these characteristics, the definitions and typology introduced by Manuel Castells and Alejandro Portes (1989) remain prominent. Castells and Portes distinguish between three economies -- formal, informal and criminal. In contrast to the formal economy, the informal entails `income earning activities unregulated by the state in contexts where similar activities are so regulated' (Portes 1996: 148-9). The criminal economy is similar to the informal economy; both entail production and distribution activities that evade state regulation. But, as argued by Castells and Portes (1989: 14-15; Portes 1995: 29), the primary distinction between the informal and criminal is that the latter entails `the production of goods and services socially defined as illicit' and criminalised by the state. Having delineated the three economies as distinct but interrelated, the authors in this and later works limit their focus to the informal economy and its interaction with the formal. The criminal economy is addressed only in passing. Immigrants feature prominently in the informal economy literature. For some scholars, increased immigration -- and the migrant's transference of `survival strategies' or discordant cultures from developing countries -- is the primary source of a rise in informal activities. Others reject such a narrow causal connection, pointing instead to patterns of state regulation and structural economic shifts that both alter inroads into the formal economy and create opportunities for informal employment and entrepreneurship (e.g. Castells and Portes 1989: 23, 27-9; Sassen 1998a: 4, 13). Efforts to explain differences in the extent of informal activities by immigrant groups point to these dynamics as well as to other factors such as migration networks (e.g. Light et al. 1993: 25). In contrast, immigrant participation in criminal activities receives little attention, despite the potential for regulatory patterns, economic shifts and migration networks to limit opportunities in the formal and informal economies and open them in the criminal. Scholarship on immigrant entrepreneurship also tends to exclude the criminal economy, focusing instead on variation in the extent and success of self-employment - especially small business ownership and operation. Efforts to explain this variationtend to rely on models of supply and demand effects as well as more narrowly focused explorations of ethnic group resources and opportunities (e.g. Light and Rosenstein 1995; Waldinger et al. 1990). A common theme in both approaches is that resources and opportunities interact. Ethnic groups face opportunity structures distinguished by different patterns of blockage (e.g. stemming from discrimination) and access (e.g. areas of underserved demand). The groups differ in the resources (e.g. financial, human and social capital) that they can bring to bear in responding to such opportunity structures. The interaction between resources and opportunities shapes patterns of immigrant business in the formal and informal economies. The extent to which such interactions influence patterns in the criminal economies of advanced industrial countries remains underexplored. Ivan Light's 1977 study of the ethnic vice industry offers a prominent exception and reveals how supply and demand effects -- including population characteristics (such as gender distribution), management skills and experience -- shaped ethnic entrepreneurship patterns in prostitution. The study's conclusion that scholars need to explore both legal and illegal entrepreneurship, however, appears to remain the exception rather than the rule. Light's more recent work only briefly explores the criminal economy (e.g. Light and Rosenstein 1995: 215-17), attributing illegal entrepreneurship to value considerations such as the money and life-style of crime and to opportunities created by `deprived socio-economic conditions' such as drug demand. Light's 1977 study bridged the ethnic entrepreneurship literature and the work of sociologists and criminologists on ethnic crime by noting similarities in the explanations offered for behaviour in the legal and illegal economies. Such similarities still exist. The sociology and criminology literature on the relationship between immigration and crime is extensive. It includes classic works on the criminal activities of first- and second-generation immigrants, the impact of culture conflict, crime as a path to socio-economic advancement and/or a reaction to anomie, as well as more recent scholarship on the effects of social control, labelling, moral panics, and racial disparities in the criminal justice system (see the reviews in Hawkins 1995; Tonry 1997). Blockage and immigrant resource arguments remain dominant approaches in the literature (O'Kane 1992; Tonry 1997). The former contends that barriers to licit paths for socio-economic mobility -- including discrimination, structural economic conditions, competition for market niches from prior migrants -- lead immigrants to illicit paths. However, since `not all disadvantaged groups exhibit high crime rates' (Tonry 1997: 13-14), scholars have tended to integrate blockage arguments with a focus on aspects of immigrant groups. These include ethnic networks (both as a source of resources and new opportunity structures) and cultural characteristics. In short, the informal economy, immigrant entrepreneurship and immigrant crime literatures all suggest that the interaction between resources and opportunity structures helps to explain immigrant activities. Under what conditions does this interaction lead to immigrant entrepreneurship in the illicit drug trade? Bridging the literatures suggests that illegal entrepreneurship would be more likely to occur where wage-employment and self-employment opportunities are blocked in the formal and informal economies, where opportunities exist in the criminal economy, and where ethnic resources are conducive to the criminal activity. The caveat here is that though such an approach can help to explain patterns of variation between ethnic groups, it offers only limited insight into why only a small percentage of members of a given ethnic group tend to engage in illegal entrepreneurship (O'Kane 1992: 111). In the drug trade, opportunities for entrepreneurship reflect drug demand patterns and the nature of existing trafficking networks. For example, Vincenzo Ruggiero (1996) observes that, as in licit activities, migrants can face blockage in the criminal economy. The more physically distinct the ethnic group, the more its members often are relegated to the visible, and therefore dangerous, aspects of the trade such as importation and street-level retailing. However, as Richard Freeman (1996) argues, the demand for drugs also interacts with the opportunities for entrepreneurship in the trade. Specifically, incarceration of the trafficker/ dealer/offender does not decrease the criminal opportunities open to new entrepreneurs. As a result, state enforcement efforts against established drug trafficking networks risk the unintended effect of creating new opportunities for illegal immigrant entrepreneurship -- in effect, a vacancy chain instigated by the state (White 1970). The ability of entrepreneurs to capture such opportunities appears to be shaped by ethnic resources including organisational skills and access to drug production and distribution networks in their home country. Immigration, employment and entrepreneurship in Japan Immigration scholars often refer to Japan as a `latecomer' when compared to other advanced industrial countries (Cornelius 1994). This classification is partially accurate. Japan has an immigration history stemming back to the early origins of the Japanese people and the debate over these origins remains highly contested (see the discussion in Hingwan 1996; Smith 1995). Japan's more recent immigration history begins in the late 1800s and relies on distinctions between `oldcomers' and `newcomers' and on typologies of immigration waves (Kajita 1998; Mori 1997; Shimada 1994). Immigrant employment and entrepreneurship patterns differ for the oldcomers and newcomers as well as for ethnic groups within each of these categories. Immigration background Oldcomers comprise the first major wave of immigration dating from the late 1800s through the mid-1900s. This wave consists of the voluntary and involuntary migration of Korean and, to a lesser extent, Chinese labourers to Japan. By the closing days of World War II, Japan was home to an estimated 2.1 million Koreans (Weiner 1994: 207). The roughly 600,000 Koreans and 39,000 Chinese (mainland and Formosan) who chose to remain in Japan by the late 1940s became the basis of the country's permanent foreigner resident population (zainichi gaikokujin) (Mitchell 1967; Weiner 1994). The newcomers (rainichi gaikokujin) comprise all subsequent waves of immigration. For example, Japan's second wave dates from the late 1970s and early 1980s and consists of women from East and Southeast Asia. These women, usually referred to as japayukisan, literally Japan-bound person, entered the country under tourist and student visas and were fed into the informal and criminal economies as bar hostesses, entertainers and prostitutes by Japanese organised crime groups (Sellek 1996; Yamanaka 1993). Japan's third wave begins in the mid-to-late 1980s and consists of predominantly Asian and Middle Eastern male, unskilled workers (termed gaikokujin rodosha, foreign labour, by the late 1980s). Though unskilled labour is illegal under Japanese immigration regulations, these workers took advantage of bilateral visa exemption accords for tourist travel and the lax enforcement by immigration authorities at ports of entry and at places of employment. Japan's fourth wave dates from the 1990 amendments to the Immigration Control and Refugee Recognition Act (ICRRA) and the act's new provisions allowing entry for skilled/unskilled descendants of Japanese emigrants. These second- and third-generation nikkeijin come primarily from Brazil and Peru (Sellek 1997). Despite these four waves, Japanese immigration levels remain low when compared to those of other major advanced industrial countries. OECD data for 1996 reveals immigrants as only 1.1 per cent of Japan's total population, compared to 3.4 to 8.9 per cent for the United Kingdom, France and Germany (Gurowitz 1999: 421). The population estimates for Japan are based primarily on alien registration figures collected by the Ministry of Justice. Permanent foreign residents as well as newcomers and others seeking to legally reside in Japan are required to register with the ministry's Immigration Bureau. Under the 1990 ICRRA, foreign nationals must register within 90 days of arriving in Japan (or 60 days after birth or renouncing their Japanese nationality) (ICRRA 1998). Table 1 reveals that the number of registered foreigners for four of the six largest groups -- Chinese, Brazilian, Filipino and Peruvian -- has been steadily increasing since the late 1980s. In contrast, the registered Korean population, comprised primarily of permanent foreign residents, has remained fairly constant. |
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Table 1. Registered aliens by nationality, 1988-97
1988 1990 1992 1993
Korea 677,140 687,940 688,144 682,276
China 129,269 150,339 195,334 210,138
Brazil 4,159 56,429 147,803 154,650
Philippines 32,185 49,029 62,218 73,057
USA 32,766 38,364 42,482 42,639
Peru 864 10,279 31,051 33,169
Others 64,622 82,874 114,612 124,819
Total 941,005 1,075,317 1,281,644 1,320,748
(PFR) na na (635,422) (631,812)
1996 1997
Korea 657,159 645,373
China 234,264 252,164
Brazil 201,795 233,254
Philippines 84,509 93,265
USA 44,168 43,690
Peru 37,099 40,394
Others 156,142 174,567
Total 1,415,136 1,482,707
(PFR) (626,040) (625,450)
Notes: Korea refers to North and South. The abbreviation PFR refers
to permanent foreign residents. The category of Others includes:
Iranians (1,237 in 1990, 8,645 in 1995, 7,946 in 1997), Thais (6,742
in 1990, 16,035 in 1995, 20,669 in 1997), Bangladeshis (2,109 in
1990, 4,935 in 1995, 6,095 in 1997) and Pakistanis (2,067 in
1990, 4,735 in 1995, 5,593 in 1997).
Sources: Immigration Bureau, Ministry of Justice, Statistics on
Foreign Residents, June 1998 [available at Japan Information
Network, http://jin.jcic.or.jp]; Statistics Bureau, Japan
Statistical Yearbook, 1999, Table 2-15, Registered Foreigners
by Nationality (1970-97) [available at
http://www.stat.go.jp]; Tsuchida (1998: 82).
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In addition to registered aliens, Japan's foreign population is comprised of two categories of illegally residing immigrants: visa overstayers and successful illegal entrants. Given Japan's geographical location, the primary means of entering the country are by aeroplane and boat. Overstaying a tourist or other visa offers the easiest path to illegally remaining in the country. The Immigration Bureau estimates the number of overstayers by comparing entry and exit data. As seen in Table 2, the number of overstayers has remained between 276,000 and 292,000 since 1992. The largest groups of overstayers are from Thailand, South Korea, the Philippines and China, with the Thai and Filipino overstayers more likely to be female than male. In contrast, overstayer rates for groups such as Iranians and Malaysians peaked in the early 1990s and continue to decline. |
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Table 2. Estimated illegal aliens in Japan [legal entry but
overstay], 1990-97
6/1990 11/1992 11/1993 11/1994 11/1995
Thailand 11,523 53,219 53,845 46,964 43,014
Korea(S) 13,876 37,491 41,024 44,916 49,530
Malaysia 7,550 34,529 26,653 17,240 13,460
Philippines 23,805 34,296 36,089 38,325 41,122
Iran 764 32,994 23,867 18,009 14,638
China 10,039 29,091 36,297 39,552 38,464
Bangladesh 7,195 8,161 7,931 7,295 6,836
Pakistan 7,989 8,056 7,414 6,517 5,865
Taiwan 4,775 7,283 7,667 7,906 8,210
Peru 242 6,241 11,659 14,312 14,693
Other 18,739 41,430 45,295 47,056 48,912
Total 106,497 292,791 296,751 288,092 284,744
11/1996 11/1997
Thailand 39,513 37,046
Korea(S) 52,387 52,123
Malaysia 10,390 10,141
Philippines 42,547 42,608
Iran 11,303 9,186
China 38,926 37,590
Bangladesh 6,197 5,581
Pakistan 5,157 4,688
Taiwan 9,409 9,430
Peru 12,942 11,606
Other 54,845 56,811
Total 282,986 276,810
Sources: Criminal Statistics in 1996. Tokyo: Keisatsucho, 1997:
265; National Police Agency, White Paper on Police. Tokyo:
NPA, 1996: 116; Shimada (1994: 26-7).
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The second category of illegally residing immigrants consists of those who entered the country illegally. The most common means of entry have been to enter legitimate ports using fake documents (passports and/or visas) or to simply smuggle the migrants into Japan by boat. Insights into the size of this foreigner population are limited at best. Immigration Bureau figures reveal that 4,151 foreigners were apprehended seeking to enter Japan with fraudulent documents in 1987. Four years later the number increased to 20,726 and by 1996 the number had fallen back to 4,561.(1) Interdiction efforts against migrant smuggling rings during the mid-1990s revealed Chinese and, to a much lesser extent, Korean, Southeast Asian, and Middle Eastern immigrants. The number of foreigners discovered in large-scale smuggling incidents peaked in 1997 at roughly 1,400 persons, of whom 1,200 were Chinese. In the midst of growing concerns among law enforcement agencies over what became known as Snakehead smuggling networks, these numbers led to broader estimates that upwards of 12,000 to 14,000 migrants were entering the country illegally. Adding these figures to the number of resident alien and estimated overstayers still suggests a foreign population of under 2 million, out of a total population estimated in 1997 at 126 million.(2) Immigrant employment and entrepreneurship As in other advanced industrial countries, immigrant groups in Japan differ in the opportunity structures they face and the resources they can bring to bear when seeking employment. In general, the assimilation of foreigners into Japan remains limited. Due to strict government regulations and the desire of some immigrant groups to retain cultural identities and ties, few immigrants become naturalised (Kajita 1998: 126-7; Newell 1967: 212-14). From 1952 to 1992, for example, only 221,000 immigrants became Japanese citizens. Of this figure, 96 per cent were Korean and Chinese, and of this group 80 per cent of the naturalisations took place prior to 1988 (Hanami 1998: 214; Weiner 1998: 14). For oldcomers and newcomers alike, discrimination in education, medical care, housing and employment is `a fact of life' in Japan (Weiner 1997, 1998: 13). The sources of discrimination often lie in the perception of many Japanese that foreigners pose a threat to their country's homogeneity and, in turn, to Japan's economic success, low crime rates, and basic social order (Henshall 1999; Herbert 1996; Hingwan 1996; Morris-Suzuki 1998). In this context, though, not all foreigners are perceived in the same way. White Western Europeans (especially Germans) tend to be tolerated more than other Caucasians and, in descending order, Chinese, other Asians (including Koreans), Arabs, and immigrants of African descent (Henshall 1999: 81-4). Koreans often bear a special brunt of discrimination in that `they look Japanese but are not Japanese, and are in that sense a threat to the purity and uniqueness of Japanese identity' (Henshall 1999: 61; see also De Vos and Kim 1993). It is important to note that, though common, these rankings are informal at best. Moreover, they tend to vary by the generation of Japanese making the observation, shifts in the popularity of different cultural trends or perceptions of criminal threat, and the specific area of Japan. Discrimination has shaped employment opportunities. Under the ICRRA, five broad categories of immigrants are eligible to participate in Japan's formal economy (Mori 1997: 12-14). These include: 1) newcomers who have entered Japan or are residing in Japan under specified categories of skilled employment (such as engineers, legal/accounting specialists, investor/business manager); 2) students and company trainees who have obtained advanced permission to work; 3) permanent foreign residents, their spouse/children; 4) nikkeijin, their spouse/children; and 5) non-nikkeijin long-term residents, their spouse and children (e.g. Japan's small refugee community of less than 5,000 persons, primarily Vietnamese). The first category consists primarily of wage-labour positions for Japanese or foreign corporations, rather than formal self-employment by newcomers. In contrast, self-employment in the formal economy is an option for nikkeijin, oldcomers, and long-term residents. For newcomers and oldcomers alike, categories 2-5 also are the exceptions to ICRRA's explicit prohibition of unskilled immigrant labour and suggest a wider array of employment opportunities. In practice, however, these opportunities have been limited by government prohibitions on public sector employment and the tendency of major corporations to screen applicants for foreign ancestry (Henshall 1999: 64; Ryuhei 1992: 239). During the mid-to-late 1980s, these discrimination dynamics were partially offset by an economic boom. Fuelled by an undervalued currency, foreign demand, and stock market and real-estate speculation (the `bubble economy'), employment opportunities expanded across an array of sectors including manufacturing, construction and services. In contrast to earlier economic growth periods, Japan lacked a readily available labour supply to meet this demand. The declining population of workers, social and other barriers inhibiting the role of women in the economy, and school graduates increasingly unwilling to work in low-wage or `3K' jobs (kitanai, kiken, kitsui: dirty, dangerous and demanding) contributed to the tight labour market. These conditions coincided with political and economic push dynamics in labour-exporting countries in the Middle East and in East and South East Asia, and resulted in a third wave of immigration to Japan (Cornelius 1994; Mori 1997; Weiner 1998). Legal (skilled) workers entered Japan's formal economy while illegal (unskilled and service sector) workers entered the informal (Mori 1997: 62-5). By the 1990 Population Census, Japan's economy consisted of 61.7 million workers of which 437,310 or 0.71 per cent were foreign (Mori 1997: 152). The largest numbers of foreign workers appeared in manufacturing (124,412), wholesale, retail and restaurant (117,672), service (97,774), and construction (44,312). These figures only offer an indication of immigrant employment patterns in Japan's formal economy. Simply put, the census is unlikely to induce self-reporting about informal activities or the activities of illegal foreign workers (for a discussion of other limits of Japanese census data, see Mori 1997: 134-5). By the 1995 Population Census, total employment in Japan had increased slightly to 63.9 million while the number of foreign workers in the formal economy had increased to 603,559 or 0.94 per cent. As suggested by Table 3, the primary source of this increase in foreign labour was the influx of nikkeijin from Brazil and Peru. |
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Census of Japan. Tokyo:
Management and Coordination Agency, 1998, Vol. 4-1, Table 24.
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The 1995 Population Census data (Table 3) reveal a foreign self-employment rate in the formal economy of 12 per cent, concentrated in the manufacturing, construction and service sectors. This self-employment rate is comparable to Japan's national rate. But in contrast to the areas of foreign self-employment, total levels of self-employment in Japan tend to be highest in the agriculture, forestry and fisheries sectors (1.9 million persons), followed by the wholesale, retail and restaurant sector (just under 1.9 million), manufacturing (1.7 million) and services (1.7 million).(3) Wage employment rather than self-employment remained the primary locus of activity for foreigners as well as Japanese. For immigrants, this pattern reflects opportunity structures in the formal economy, especially the ICRRA categories geared more towards facilitating wage employment for skilled newcomers, nikkeijin, students and company trainees. The relatively high number of Korean, and to a much lesser extent Chinese, entrepreneurs in the formal economy suggested by Table 3 reflects the prominence of oldcomers rather than newcomers in self-employment activities. For Koreans, these activities have been a reaction to discrimination patterns as well as to opportunities created by the size of the permanent foreign resident community. Ethnic resources geared towards this community (language and social networks, especially among North Korean oldcomers) have facilitated entrepreneurial activity. Self-employment by Koreans in the formal economy has concentrated in businesses such as pachinko (pinball) parlours, transportation (truck drivers), scrap dealing, construction, real estate and other services aimed at the Korean community (Kajita 1998: 131-2; Mori 1997: 159-61; Weiner 1998: 21). It is important to note, however, that this entrepreneurship has often blurred the lines between formal, informal and criminal activities. Perhaps the best examples of this pattern are the informal pachinko parlour operations that exchange worthless prizes for cash payments, and the politically sensitive allegations that Korean-owned pachinko parlours launder portions of their earnings as illegal hard currency exports to North Korea. Oldcomers are not the only participants in the informal economy. The population census data on foreign employment fail to reveal that a large portion of Japan's third wave of immigration ended up in informal activities. From the mid-1980s to 1990, Japanese manufacturers, construction companies, and the restaurant/service sector opened their doors to illegal workers. Small and medium-sized firms, less able to compete with their larger counterparts for Japanese workers, turned to foreign labour with few questions asked. Even larger corporations hired illegal workers to meet labour needs. Visa overstayers, migrants violating the terms of their visas (e.g. tourists), and illegal entrants took advantage of the opportunities while immigration officials turned a blind eye (Cornelius 1994: 391-2; Kuwahara 1998: 371; Mori 1997: 62-5; Shimada 1994: 31; Weiner 1998: 11). The sheer array of opportunities for lucrative wage employment in the informal economy -- with wage levels not only higher relative to home-country standards but initially comparable to native day-labour and subcontract levels -- suggests that wage employment overshadowed self-employment among newcomers (Mori 1997). Rough estimates by the Ministry of Justice during the early 1990s revealed that labour brokers had facilitated the job placement of an estimated 70-90 per cent of the illegal foreign labourers since the mid-1980s (Herbert 1996: 64). As an aside, the extent of the self-employment opportunities for newcomers as labour brokers in Japan during this period is unclear. The Ministry of Justice estimated that, since the early 1990s, between 30 and 50 per cent of labour brokering was conducted by foreigners. But, given the increased politicisation of the illegal worker issue, these figures must be taken with caution. Japanese brokers, and to a lesser extent oldcomers, were tapped into the extensive subcontracting networks of the construction and manufacturing sectors. Foreign labour brokers were operating in source countries but to a lesser extent in Japan and often with Japanese counterparts. Moreover, both Japanese organised crime groups and foreign brokers were active in recruiting foreign women into the entertainment industry (Herbert 1996: 65-6; Komai 1995: 27-8, 77-8). In 1990, the opportunity structures for immigrants and the resulting employment patterns in the informal economy shifted. A backlash against the growing number of racially distinct, and therefore highly visible, illegal foreign workers prompted a national debate over immigration. The debate resulted in the suspension of visa exemption accords for Bangladesh and Pakistan, threats of crackdowns and imprisonment of illegal aliens, and the 1990 ICRRA. Fearing imprisonment, an estimated 20,000 foreigners, especially from Bangladesh and Pakistan, turned themselves in to immigration authorities and were returned to their home countries (Martin 1991: 181). The resulting labour shortage was soon filled, in part, by increased immigration from Iran (until the suspension of the Iranian visa accord in 1992). The ICRRA's new provisions revamped and expanded Japan's visa categories from 18 to 28, and included tighter restrictions on the granting of entertainer visas, and prison and financial penalties for employing illegal workers (Mori 1997: 10; Sassen 1998b: 60-2; Spencer 1992: 762). More important, the amended ICRRA opened the door for a legal supply of unskilled labour through provisions allowing the entry and employment of nikkeijin from Latin America and of company trainees (primarily from East Asia). Large Japanese companies responded to the ICRRA provisions by displacing their illegal foreign workers in favour of nikkeijin and, to a lesser extent, company trainees. Medium and small companies, unable to compete financially for the nikkeijin, turned to East Asian illegal foreign workers more likely to pass the cursory inspection of Japanese immigration authorities (Mori, 1997: 63, 112). This pattern of displacement took place despite the fact that enforcement by immigration authorities remained lax (Cornelius, 1994: 391-2). This shift in opportunity structures in the formal and informal economies rewarded some immigrant groups with specific ethnic resources (Asian appearance, or Japanese lineage in the case of the nikkeijin) and penalised others such as Iranians. In 1992, opportunity structures in the formal and informal economies changed again but this time the source was a broader structural shift in the Japanese economy. As illustrated in Table 4, the collapse of the Japanese economic bubble in late 1991 resulted in declining growth rates and rising unemployment. Large manufacturing corporations compensated for the bubble's collapse by cutting back their non-permanent labour force (part-time, female, and foreign) and partially shifting the burden of cost reductions to their affiliated subcontractors. In turn, medium and smaller manufacturing corporations also scaled back positions and wage levels. In contrast to manufacturing, the slowdown in the construction sector was partially offset by public works projects aimed at stimulating the economy while the service sector continued to expand. |
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Information Network, http://jin.jcic.or.jp].
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The impact of the bubble's collapse on the foreign employment of newcomers varied by immigrant group. Disproportionally employed in large-scale manufacturing, the nikkeijin experienced the greatest initial job losses (Mori 1997: 74-8). But as legal foreign workers, the nikkeijin remained attractive to employers in other sectors of the formal economy. The growing size of the nikkei community and its concentration in company towns also offered new market niches. In prefectures including Gunma, Kanagawa, Shizuoka and Hammamatsu, nikkei entrepreneurs established labour brokering networks, newspapers and magazines, and stores and restaurants (Kajita 1998: 128-9, 145; Mori 1997: 144-8; Sellek 1997: 199-200). Due to their Asian appearance, Korean and Chinese workers, both legal (Chinese trainees) and illegal, remained attractive to medium and small firms. Ethnic networks in the Osaka, Kobe, and to a lesser extent Tokyo, areas continued to open opportunities and provide resources for Korean newcomers (Sellek 1994). Ethnic networks among the growing Fujian community in Japan also fed newcomers into the service sector in areas of Chinese concentration such as the Kobukicho and Ikebukuro areas of Tokyo (Mori 1997: 146). In contrast, other immigrant groups appeared to be disproportionately affected by the economic downturn. Of these, Iranians attracted the greatest attention. Increased Iranian immigration had led to the suspension of the visa exemption accord in 1992. Compared to other newcomers, most Iranians lacked both opportunity structures and ethnic resources suited to wage employment in the formal and informal economies. Iranian workers tended to rely on labour brokers and were most commonly employed as construction workers and unskilled labourers (Mori 1997: 178, 181). As Iranians began to congregate in public spaces such as parks and train stations, they became more visible reminders of an illegal foreign presence in post-bubble Japan and greater targets for enforcement authorities. Some displaced Iranians explored self-employment options in the informal economy such as selling doctored telephone cards while others turned to more criminal pursuits. By 1993, the police and immigration agents were staging joint sweeps against Iranians and other illegal foreigners congregating in Tokyo parks (Hingwan 1996: 72). Entrepreneurship in the criminal economy The Japanese literature on immigrant crime remains underdeveloped. Sociologists and criminologists have tended to rely on culture conflict and anomie/ blockage arguments similar to those found in the Western literature to explore the linkage between ethnicity and crime (see reviews in Herbert 1996: 190-5; Miyazawa 1997: 199). Despite the arguments of law enforcement authorities that newcomer immigrants are increasingly responsible for Japan's crime and especially the country's drug problems, the dynamics of immigrant entrepreneurship in Japan's drug trade remain underexplored. Culture, blockage and crime Culture conflict arguments in Japan note the linkage between Japanese ethnic homogeneity and the country's low crime rates compared to those of more heterogeneous advanced industrial countries. Briefly, these arguments contend that since immigrants are not Japanese, the increased presence of their cultures in Japan inevitably will lead to conflict. The social control variant of this argument posits that Japanese (legal) culture contains an array of formal and informal group-centred rules that dissuade criminal behaviour (see, for instance, Fujimoto 1994: 13-14; Komiya 1999; as well as the observations of Western scholars such as Bayley 1991; Braithwaite 1989). Since immigrants are not Japanese, these rules are lacking in their cultures, making them more likely to engage in crime. Other scholars have called attention to the discrimination faced by Japanese minorities -- such as the burakumin, the indigenous ainu, and permanent foreign resident Koreans -- and have linked this aspect of socio-economic blockage to delinquency rates and other aspects of criminal behaviour (De Vos 1992; De Vos and Kim 1993). These arguments remain controversial in Japan. For example, some scholars have argued that Japanese organised crime (the boryokudan or yakuza) has offered a path to advancement, in effect a social safety net, for permanent foreign resident Koreans. However, there is little agreement or willingness to publicly speculate on the actual extent of the yakuza's ethnic Korean membership (De Vos and Mizushima 1967; De Vos and Kim 1993: 208; Kaplan and Dubro 1986). More important from the standpoint of this article, little scholarship has appeared exploring the extent to which relatively closed opportunity structures in the formal and informal economies might be influencing patterns of entrepreneurship by newcomer immigrants in the criminal economy. The few exceptions briefly observe that discrimination faced by foreign workers may lead to minority ghettos, an erosion of Japan's economic homogeneity, and a greater incidence of crime (Miyazawa 1997: 207-8; Shimada 1994: 5, 46-7). Immigrants in the Japanese drug trade Drug offences in Japan are dramatically lower than those in other advanced industrial countries. The drug problems at issue are also different, with between 85 and 93 per cent of drug arrests in Japan involving the stimulant methamphetamine. The prominent explanations for Japan's relative absence of problems with heroin, cocaine and cannabis are similar to those explaining the country's low overall crime rate -- Japan's cultural homogeneity works against drug usage due to informal control dynamics (see discussion in Friman 1996a). For Japanese law enforcement officials, the increase in problems with narcotics, cannabis and stimulants since the late 1980s, therefore, reflects the growing number of immigrant newcomers, especially those from drug-source countries in Latin America and Asia. There is some merit to these arguments. Japan does offer a lucrative market, especially as the United States and Europe become saturated. Moreover, as seen in Table 5, arrests of foreigners for drug offences have increased since the mid-1980s. In contrast, the table also suggests that recent immigrants (classified in the table as foreign visitors) account for only a very small portion of the overall drug trade, especially in the case of stimulants. It is also important to note that arrest data offer an incomplete picture of crime patterns at best and part of the correlation between increased immigration and drug crime may simply reflect the law enforcement community's focus on foreigners (Friman 1996a; Herbert 1996). Statistical caveats aside, however, immigrants are involved in the Japanese drug trade. |
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396-7, 410-11).
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The arguments of Japanese law enforcement authorities tend to ignore the possibility that participation may be shaped by displacement from the formal and informal economies, and focus instead on aspects of ethnic origin. Drug offenders are often posited as foreigners who come to the country simply to commit crime and leave. The remainder of this section explores ways in which ethnic resources and opportunity structures in the criminal economy, as well as displacement from shifting opportunity structures in Japan's formal and informal economies, might help to explain immigrant involvement in the drug trade. The ethnic resource of ties to a drug-source country, and potentially to production and distribution networks in that country, can facilitate immigrant participation in the trade. Among Japan's newcomers, Latin American immigrants potentially have access to the cocaine trade, Southeast Asians to cannabis, heroin and opium, East Asians to methamphetamine, heroin and opium, and Middle Easterners to opium, heroin and cannabis. In light of the extensive transhipment networks that characterise today's drug trade, these patterns also may understate ethnic resources in terms of access to different drugs. Irrespective of these resources, however, sellers must have markets-specifically, they require access to buyers, either from their own ethnic group or from the broader population in the host country. With the relatively small immigrant population in Japan, access to broader markets is essential. But such opportunity structures in Japan's drug markets traditionally have been influenced heavily by the presence of Japanese organised crime. By the collapse of the bubble economy in the early 1990s, Japanese organised crime was dominated by three syndicates -- the Yamaguchi-gumi (based in the Osaka--Kobe area), Inagawa-kai (Tokyo) and Sumiyoshi-kai (Tokyo) -- accounting for an estimated 1,200 local organisations and 35,000 members. An additional 1,800 local organisations and 52,000 members were fragmented across a number of smaller associations. The top three syndicates dominated the methamphetamine trade, acting as primary wholesalers and retailers for affiliated suppliers in Taiwan, Korea, Hong Kong and, to a lesser extent, the Philippines (and the PRC by the mid-1990s) (Friman 1996a, 1999: 180-2). Smaller crime groups and lower-level affiliates of the big three, who were seeking to move up in influence, were the primary conduits for other drugs such as cannabis and narcotics. Europeans and Americans living in Japan offered a secondary conduit for narcotics and cannabis, catering both to foreigners and Japanese (and often using contacts established through their positions in the formal economy as teachers in English-language schools). The major affiliates within the big three had experimented briefly with heroin trafficking in the 1960s with little success. More important, the syndicates tended to view cocaine as a market competitor for methamphetamine. For example, the brief spike in the number of Colombians arrested for cocaine during the early 1990s reflected the unsuccessful efforts of Medellin and Cali cartel representatives to break into these larger Japanese distribution networks (Friman 1996a, 1996b: 69-81, 1999: 180-2). The big three syndicates have offered immigrants selective inroads into the drug trade. For example, the Yamaguchi-gumi has traditionally been the most open to Korean residents while the Inagawa-kai has been the least receptive to foreigners regardless of their nationality. In the Kobe--Osaka area gang wars of the late 1940s, for example, the Yamaguchi-gumi assimilated its opposition by including members of local Korean gangs such as the Meiyu-kai. Later alliances with Tokyo gangs such as the `largely Korean' Tosei-kai would facilitate upstream linkages with Korean suppliers of methamphetamine. In contrast, the Inagawa-kai sought to destroy its Korean and Chinese competition in the Tokyo-Yokohama gang wars of the late 1940s. Lacking the Yamaguchi-gumi's Korean connection, however, both the Inagawa-kai and the Sumiyoshi-Kai turned to building connections with Taiwan and Hong Kong earlier in the 1970s. These efforts focused more on Japanese representatives establishing ties with source countries than on Japanese gangs seeking to incorporate permanent foreign resident Chinese (Friman 1999: 180-5). In 1992, however, opportunity structures in the Japanese drug trade began to shift. First, the collapse of the bubble had an adverse impact on the yakuza organisations, many of which had entered into the stock and real-estate markets. As gangs began to restructure, many turned to exploring activities including cannabis and narcotics as well as the smuggling and brokering of illegal immigrant labour. Second, a series of corruption scandals in Japan during the early 1990s led to new anti-organised crime legislation. The new measures criminalised an array of traditional gang activities and imposed new restrictions and monitoring provisions. Though rife with loopholes, the new legislation had an impact on Japanese organised crime. Membership started to fall, revenues from traditional protection and other operations began to decrease, and violent disputes erupted between lower-level affiliates over revenues that led to new police crackdowns by the mid-1990s. The yakuza's efforts to divert public and police attention by moving further underground began to open opportunities for greater immigrant participation in the informal and criminal economies. In the drug trade, these opportunities included the increased willingness of Japanese crime groups to subcontract high-risk portions of the drug networks, such as street-level sales (Friman 1999: 188-9). As argued in the preceding section, the combination of changes in Japanese immigration laws, discrimination and economic downturns in the early 1990s began to close opportunity structures for wage and salary employment in the formal and informal economies. With few exceptions, such as the nikkei and permanent foreign resident Koreans and Chinese, immigration regulations precluded a shift from wage to self-employment in the formal economy. Discrimination and enforcement efforts by police and immigration officials focusing on higher-profile groups of foreigners also constrained the ability of displaced newcomers to shift from wage to self-employment in the informal economy. In contrast, the combination of economic downturns and state enforcement steps against the yakuza during this period began to open opportunity structures in the criminal economy. Ethnic resources, or more specifically ethnic liabilities, and specific shifts in opportunity structures affected some groups of immigrants more than others. Iranians who were illegally working in Japan as unskilled labourers were especially influenced. Closed out of the formal economy by their immigration status and increasingly closed out of wage employment in the informal economy by their visible ethnicity, Iranians could leave the country or look for new opportunities. With Japan's suspension of the visa exemption accord with Iran in 1992, leaving the country greatly increased the difficulty of ever returning. This combination appears to have influenced a shift by some Iranians into the Japanese drug trade, as the data in Tables 6 and 7 reveal. |
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Police (excerpt), 1994: 77; 1996: 62-6.
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Initially, Iranians appeared to explore drug markets within their ethnic community. As seen in the tables, Opium Law offences increased during the early 1990s and peaked in 1994. Comparing the figures in Table 6 with those in Table 5 reveals that Iranians comprised the bulk of these arrests. The limited market for opium in Japan, and the efforts of Iranians to import rather than tranship the drug, has led some scholars to informally observe that Iranians were using the drugs more as gifts within the Iranian community than seeking to sell the drugs to the broader public. By 1994, however, media reports and police statistics suggested the movement of Iranians beyond opium into all areas of the Japanese drug trade.(4) Table 7 reveals that by 1996 Iranians were appearing among the top three groups of foreign offenders for each of Japan's drug laws. Of these activities, the figures on violations of Japan's Stimulant Control Law are the most important indicators of a shift in Japan's criminal economy. Iranian ties with Japanese organised crime stem from the late 1980s and early 1990s as Iranian illegal workers initially sought assistance from yakuza and affiliated labour brokers to obtain wage employment in the informal economy. Other Iranians, especially those from poorer, working-class neighbourhoods of Tehran, expressed little interest in wage labour and sought out more direct ties with the yakuza, earning money as distributors of doctored phone cards and overseers of foreign prostitutes (Carroll 1992). As wage labour opportunities in the informal economy decreased with the collapse of the bubble economy, however, a growing number of Iranians turned to the criminal economy. As noted, the changing fortunes of Japanese organised crime had led to openings for subcontract relations with foreign street-level retailers in the yakuza distribution networks for methamphetamine. Through the mid-1990s, Iranians increasingly began to occupy these positions. By 1998, press reports were citing a National Police Agency Survey positing the existence of `50 drug dealing networks' run by Iranians, some with `akuza ties,' and `employing about 1,000 dealers'.(5) Japanese media stories and police reports often sensationalised the trend, noting how Iranian drug sellers were waylaying young schoolgirls at public places such as railway stations. Rather than exploring the reasons for the increased Iranian presence in arrest statistics, the reports tended to focus on the -new crime threat by foreigners illegally staying in Japan.(6) However, the Iranians were conducting drug transactions with a product, and in areas, traditionally controlled by Japanese organised crime. This suggests that a much broader phenomenon was taking place. Increasingly displaced from wage and self-employment opportunities in Japan's formal and informal economies, a growing number of immigrants had obtained access into the criminal economy as operators and employees of street-level, methamphetamine distribution networks. Building on this access, Iranian entrepreneurs also appeared to be tapping into ethnic resources, including social networks and ties to drug source and transit countries, to expand distribution to other drugs. Conclusion The relationship between the formal, informal and criminal economies remains underexplored by scholars of immigrant entrepreneurship. One result of this gap is that the informal economy, entrepreneurship and crime literatures each rely on roughly the same causal factors -- specific ethnic resources and patterns in opportunity structures -- but to explain different outcomes. The work of scholars such as Ivan Light suggests that these literatures can be bridged to offer greater insights into the dynamics of legal and illegal entrepreneurship. Immigrants participate in the formal, informal and criminal economies. They bring resources to and face interrelated patterns of blockage and access in each. In this article, I have drawn on the work of Light and others to explore Japanese arguments on the nature of immigrant drug crime. I contend that immigrant entrepreneurship is taking place in the drug trade but not to the extent suggested by the public debate over the immigrant threat and not necessarily for the reasons suggested by Japanese scholars and law enforcement officials. Immigrant entrepreneurship patterns appear to be shaped by the resources of different migrant groups and, more importantly, by the nature of blockage patterns in the formal, informal and criminal economies. This interaction of ethnic resources and opportunity structures has privileged some immigrant groups such as the nikkeijin and limited the opportunities of others. Drawing on an array of ethnic resources, some permanent foreign resident Koreans have responded to blockage in the formal economy with self-employment in the formal, informal and criminal economies. Newcomers, who with few exceptions are closed out of the formal economy by Japanese immigration laws, have tended to rely more on wage employment in the informal economy. Structural economic shifts caused by the collapse of Japan's bubble economy altered opportunity structures in the formal and informal economies, especially for those whose ethnic resources increased the difficulty of blending into Japan's native population. At the same time, the bubble's collapse and the Japanese government's steps against organised crime opened new opportunities in the criminal economy for immigrant entrepreneurship. The experience of Iranian immigrants in Japan's drug distribution networks illustrates this pattern of displacement and criminal opportunity. For the newcomers comprising Japan's recent immigration waves, entrepreneurship appears to have done little to facilitate socio-economic advancement and incorporation. Though immigrants are gradually being accepted in Japan, especially at the local level, discrimination remains the rule rather than the exception. In this context, entrepreneurship appears no more likely than wage employment to facilitate extensive advancement and incorporation. Stagnant economic growth and rising unemployment over the past several years have eased the perception that Japan needs to come to terms with immigrant labour, especially with those foreign workers engaged in what Hernando de Soto (1989) has termed `the other path' of the informal economy. Those immigrants exploring entrepreneurship in Japan's criminal economy appear to have made even less progress towards socio-economic advancement and incorporation. Instead of offering a ladder to success, criminal activity has fed into broader fears of immigration as a threat to Japanese social order and, for policy makers and scholars alike, diverted attention from exploring the relationship between economic activities in the country's formal, informal and criminal domains. Acknowledgements The author wishes to thank Robert Kloosterman, Jan Rath and the other participants of the Amsterdam workshop on `Immigrant Business in the (In)formal Economy' for their comments and suggestions. Notes (1) See Immigration Bureau, Ministry of Justice, Deportation of Foreign Nationals, 1999 [available at http://www.moj.go.jp]; also Sellek (1994: 175). 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Author details H. Richard Friman is Professor and Chair of Political Science, Marquette University, Milwaukee, USA. E-mail: h.r.friman@marquette.edu |
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