Follow the money road! This is the basic principle to fight high-level mafia and corruption in each civilized country. Let us not forget that the Great Al Capone, after a long conflict with the authorities in his own country, was arrested because of a finance inspector who found out that the mafia boss was evading taxes. Nowadays the organized crime does not make such simple mistakes, because many white-collar workers work for it.
The annual turnover of Bulgarian mafia amounts to 3.5 billion leva, shows the data published by the Center of Democracy Research. This comes up to almost 5 % of the GDP of Bulgaria which is three times more than the budget of the Ministry of Interior. Organized crime in this country earns well from prostitution, drug dealing, tax evasion, tobacco smuggling and fuels. Bulgarian mafia earns more than 1.2 billion leva only from prostitution abroad. For 8 years a Bulgarian pimp in Holland has earned almost 4 million euro from a single girl, comments Interior Minister Tsvetan Tsevetanov. Some 1,200 advertisements offering money for sex are published monthly on the internet. Each pimp controls about 2-3 girls, but there are also organized groups.
Corporate crime known also as the “Oligarchy” is particularly dangerous. Frauds related to VAT are among the most common ones in this country, where they rate second in the mafia annual income. It is estimated that this kind of fraud causes losses for the government amounting to around 1 billion leva each year. The recent campaigns held by the tax officers and the police have damped the ardor of the so called “White collars” for quick profits.
Biggest growth is seen in the trade of cigarettes without excise label, where the number of consumers reaches almost half a million people. Last year customs officers and police have confiscated 27 times more illegal cigarettes in comparison to 2009. Annual profits from alcohol and tobacco smuggling amount to 470 million leva and profits from drug dealing are estimated at more than 350 million. We see redistribution of market shares in the drug market as many drug dealers switch to cigarette dealing, where profits are higher and penalties are much lower.
Most of the criminal networks in Bulgaria control legal business structures. That makes money laundering an easy process.
“Almost 70-80 percent of all members of criminal groups or their leaders have entirely legal business now. It is a topic of another discussion whether this is a cafeteria, or a fast food chain, or real estates” –says in an interview for Radio Bulgaria
Tichomir Bezlov from the Democracy Research Center. “Of course this is a way to make funds legal and an investment which makes their life easier and safer. This is a very common strategy. People exit the criminal markets and start to play by the rules.”
Don Corleone has become a symbol of world mafia and Italy continues to be at the top ranking of the organized crime, where even the Russian mafia is powerless. But what is the situation in Eastern Europe and Bulgaria?
“There is a wide-spread discussion in this country, because here illegal business and the oligarchy have merged with the classic organized crime which is linked with drug dealing, human trafficking, smuggling and so on”, says our interviewee. “In Eastern Europe the group linked with powerful companies who commit frauds or the so-called “White collars” is not associated with organized crime and the discussion is mainly over the frauds. But when we speak of Oligarchs and big companies as well as about people who own them, then the discussion is quite intensive. I was quite impressed to see that in the Czech Republic organized crime has the biggest influence over corruption. The Baltic region is also an interesting place. Lithuania and Latvia for instance are in similar situation as Bulgaria in regard to cigarette smuggling. Large contraband channels directed to Western Europe cross those two countries.”
Here, the penetration of organized crime in the legal economy is significantly bigger than in Western Europe. How can we fight Mafia? Perhaps by following the money road - it will show us its origin, all profits, investments and taxes.
“Yes, money is a good instrument to achieve that- agrees Tichomir Bezlov. “The problem is that we need highly qualified personnel to search for money from organized crime. And these people are quite costly. There are only a few people in the public administration with such capacity. I think that the situation in the National Revenue Agency is a bit better. It has a slightly higher capacity. It is a matter of political will for this capacity to be used”.
English version Kostadin Atanassov
