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UFPPC (www.ufppc.

org) — Digging Deeper XCV

September 14, 2009, 7:00 p.m.

Misha Glenny, McMafia: A Journey through the Global Criminal Underground

(New York: Vintage Books/Random House, April 2009). Originally U.K.
edition April 2008; German hardcover edition January 2008).

[Thesis. “It is not globalization in itself PART I: THE FALL OF COMMUNISM

that has spurred the spectacular growth
of organized crime in recent years but Ch. 1: Death of an American. Ilya
global markets that are either Pavlov, a Bulgarian who became a U.S.
insufficiently regulated, especially in the citizen, murdered in March 2003 in Sofia,
financial sector, or markets that are too was an entrepreneur who devised a way
closely regulated, as in the labor and for Communist elites to transition into
agricultural sectors” (345).] control of free-market economies (3-12).
Car theft rings posed as insurance
Foreword to the Vintage Edition. The companies (12-16). Prostitution offers an
financial crisis presents an opportunity to easy entry level for aspiring criminals
reform a global system that has (16-19). The U.N.’s economic sanctions
facilitated the rise of McMafia (ix). Since on Serbia and Montenegro fostered the
publication, drug cartels have moved into criminal underground (19-20).
Sierra Leone and Liberia, Chinese
criminal syndicates continue to infiltrate Ch. 2: Bloody Lucre. Montenegro’s
and contaminate production chains, president in the early 1990s, Milo
northern Mexico has become a drug war Djukanovic, was typical of leaders
slaughterhouse (x). The Sicilian Mafia involved with organized crime—in his
has collapsed, but other Italian crime case, cigarette smuggling (21-27). In
syndicates have filled the vacuum (x-xii). Croatia, arms smuggling (27-29). Various
Balkan smuggling rings (29-33). Serbian
Introduction. The 1994 killing in gangs (Arkan; ‘Vanja’ Bokan; the Zemun
southern England of Karen Reed, sister of gang) were tougher and better organized
Alison Ponting, whose husband was (33-40). In 2000 they got involved in
involved in a Chechen political mafia (xiii- cocaine smuggling from Colombia and
xv). The dissolution of the post-WWII Bolivia (41-45).
order had its roots in globalization’s
liberalization of financial and commodity Ch. 3: The Mafiya: Midwives of
markets in the early 1980s (xv-xvi). Capitalism. Caviar smuggling in
Criminals, first from Russia and Eastern Kazakhstan and Russia (46-53).
Europe, then from other countries like Extortion rackets in Russia, gruppiorovki,
India, Colombia, and Japan, took “ in fact privatized law enforcement
advantage of opportunities, especially in agencies,” (54; 53-56). The
a “thick belt of instability” stretching appropriation of Russia’s wealth by
from the Balkans to Western Pakistan and robber barons was facilitated by
China (xvii-xviii). Acc. figures from the bureaucrats and organized crime (56-59).
World Bank and IMF, the illicit economy Disputes are resolved in strelka, or
now makes up 15-20% of global GDP and conferences, among krysha (protection
has links to licit economic and political agencies); an inevitable outgrowth of the
institutions (xix). Crime is “incomparably way Russia’s transition to capitalism was
more damaging” to people’s lives than handled, they were much more
terrorism (xix-xx). widespread and had a quasi-legitimacy
that the Cosa Nostra never had (59-63).
“No societies are free from organized the most influential Russian oligarchs and
crime except for severely repressive gangsters were Jewish,” a fact many
ones” (61). Sergei Mikhailov presided prefer to pass over in silence, but which
over the Solntsevo mob, an empire of Glenny explains by the glass ceiling for
gangs (known for throwing extravagant Jews in Soviet society (112; 110-14).
tasteless parties) that went into banking Israel is “an ideal place to invest or
(63-67). In the 1990s security entities launder money” (111; 120). Corruption
deriving from the Soviet Union farmed is on the increase in Israel, where
themselves out to oligarchs and engaged globalization is undermining the
in war; Putin, having restored the collectivist ethos of Zionist society (114-
prestige of the KGB “in its novel guise as 17). Gambling and drugs (117-20).
the FSB,” tolerates former crime bosses
but has reigned in the oligarchs, creating Ch. 6: Xanadu I. [India & Dubai, a
a sort of “market authoritarianism” (67- “stately pleasure dome for the world’s
70). superrich” (153).] The bombing with
RDX of the Bombay (since 1997 Mumbai)
Ch. 4: Spreading the Word. Tomas Stock Exchange on Mar. 12, 1993 (121-
Machacek, an honest Czech policemen 25). Dubai (125-27). Gold smuggling
whose work was sabotaged in the 1990s and Bombay gang wars; Dawood
by organized crime (71-74). Tamas Ibrahim’s criminal network (127-39).
Boros, murdered in Budapest in 1998,
was involved in a heating oil scam (74- Ch. 7: Xanadu II. Rakesh Maria breaks
77). Semion Mogilevich, believed to be the stock exchange bombing case, which
the top figure in Russian organized crime was carried out by a criminal syndicate
(72-73, 77-78). The “mysterious, (140-44). Interview with a Bombay
inscrutable” ETG scam, raking in contract killer (144-46). Dubai is an
hundreds of millions from Gazprom sales, international center of money laundering,
exemplifies criminal activity with state facilitated by the deregulation of financial
backing: “It is hard to ascertain whether markets (146-60).
it was gross corruption or simply criminal,
or, indeed, where the boundary between Ch. 8: The Theater of Crime. [Nigeria]
the two lies” (80; 77-82). Organized Nigerian “419” (from the Nigerian
crime in Ukraine (82-87). Odessa, criminal code) or advance fee scams,
controlled by mobster Karabas, is close facilitated by deregulation (161-82).
to Transnistria, a breakway province of
Moldova that is “the quintessential Ch. 9: Black and White. [South Africa]
gangster state” (91; 87-93). A visit to How South Africa became “the new pivot
Tiraspol, capital of Transnistria (93-96). for the international drug trade” by
taking advantage of the juxtaposition of
PART II: GOLD, MONEY, DIAMONDS, first and third world populations, with
AND BANKS additional comments on criminal
involvement in African resource wars in
Ch. 5: Aliyah. [The Hebrew word for Angola and Congo (183-207).
immigration of Jews to Greater Israel;
literally ‘ascent.’] Russian immigration to PART III: DRUGS AND CYBERCRIME
Israel has created an organized crime
problem there (99-105). The trafficking Ch. 10: Buddies. [British Columbia]
of “Ludmila Balbinova,” who ended up in The marijuana industry in British
a Tel Aviv brothel, with AIDS (105-10). Columbia, a $5bn industry in 2006, 6% of
Russian crime’s connection unsurprising its GDP (210-17). Canadian anti-
because “[a] disproportionate number of Americanism fuels sentiment in favor of
legalization (218-23). Narcotics is the Relations to the state (304-05). Three
heart of organized crime; the U.N. leading families (306). A struggle to
estimates it accounts for “70 percent of control pachinko gambling (307-08). The
financial resources available to organized yakuza is mostly limited to Japan (309-
crime,” and legalization would undermine 12).
this (223; 223-27). British intelligence
reports demonstrate the inefficacy of Ch. 14: The Future of Organized
narcotics prohibition (227-31). David Crime. [China] The development of the
Soares, D.A. of Albany County in N.Y. Political Criminal Nexus (PCN) in China
State, advocates legalization (231-35). since the 1990s, produced by the
The U.S. war on drugs (235-39). inexorable logic of China’s economic
system (313-19). Fuzhou, the center of
Ch. 11: March of Fear. [Colombia] China’s illegal trade in migrant labor
Soldiers. The 30-year war in Colombia, (319-25). Mao eradicated the opium
probably the most dangerous country on trade but since Deng’s reforms heroin
earth (240-45). Narco-traffickers. and organized crime are coming back
Unlike other drug-infested countries, (325-31). Shenzhen is a city of 12m that
Colombia is a rich country with a has grown up in 20 years as a center of
sophisticated economy; drugs account counterfeiting (331-33). “The European
for only 1 to 3% of GDP (246-52). Union Commission estimates that fake
Guerrillas. The FARC is “an organized goods around the world are worth
military force” (254; 253-58). between $250 and $500 billion a year.
Paramilitaries “have long enjoyed Of these about 60 percent originate in
impunity and immunity for their role in the People’s Republic of China—between
the narcotics trade” (260; 258-61). 20 and 25 percent of exports from China
Gringos. The war on drugs has not are counterfeits, while between 85 and
reduced American consumption (261-63). 90 percent of products sold in the
domestic Chinese market are fake” (333-
Ch. 12: Code Orange. [Brazil] Brazil 34). Tony Tung’s cigarette smuggling
has become a center of cybercrime, operation in southern Fujian paid off
which uses music downloads, foreign officials, including North Koreans
pornography, and fake emails to gain who are emerging as counterfeiters and
access to computers (264-73). Brazil’s engaging with the global criminal
favelas and Brazilian organized crime economy (336-38). The Container
(274-80). Brazil’s connection to Chinese Security Initiative is probably easily
counterfeit contraband (280-84). penetrable by organized crime (338-41).

PART IV: THE FUTURE OF ORGANIZED Epilogue. All consumers are involved in
CRIME the world of transnational organized
crime (343). Global regulation of
Ch. 13: The Overunderworld. [Japan] financial markets is urgently needed
Japan’s yakuza is “the largest and most (344-45). “It is not globalization in itself
meticulously organized protection racket that has spurred the spectacular growth
in the world” (287-98; 300-12). Diego of organized crime in recent years but
Gambetta’s The Sicilian Mafia is “an global markets that are either
utterly convincing theory of the Mafia” as insufficiently regulated, especially in the
a “business of protection”; Wolfgang financial sector, or markets that are too
Herbert has followed his lead in studying closely regulated, as in the labor and
Osaka’s underworld (298-300). Yakuza agricultural sectors” (345).
tattoos (301-02). Yakuza helps explain
why Japan has so few lawyers (303). Acknowledgments.
university. Glenny is married to journalist
A Note on Sources. This book is and broadcaster Kirsty Lang; they have
primarily based on 300 interviews, 2004- one child; Glenny also has two children
2007 (names that have been changed from a previous marriage that ended in
are italicized on first appearance). Diego 1994. In February 2009 he wrote: “The
Gambetta’s The Sicilian Mafia: The children are used to me travelling and I
Business of Private Protection (Harvard take a lot of care to ensure my security.
UP, 1993) was a key influence. Notes My job can be dangerous but no story is
give a handful of titles for each chapter. worth getting killed for. I feel a strong
sense of responsibility that I must be
Index. 16 pp. around until the children have finished
university. At least then I will have done
About the Author. Misha Glenny was the basics.”]
educated at Bristol Univ. in England and
Charles Univ. in Prague. He was Central [Critique. Glenny’s journalistic style
Europe correspondent for the BBC World (“As Pavel Ciobanu ushers me into his
Service in the early 1990s; his reporting Audi . . .”) often charms but can be an
on Yugoslavia won a Sony Award in 1993. impediment to clarity. Part I is an
He lives in London. He is the author of ambitious attempt to piece together how
The Rebirth of History: Europe in the Age the elements of a global system of illegal
of Democracy (1990), The Fall of commerce sprang up thanks to
Yugoslavia: The Third Balkan War (1992), globalization. The rest of the book
and The Balkans: Nationalism, War and consists of essays on Israel, India, Dubai,
the Great Powers, 1804-1999 (1999). Nigeria, South Africa, British Columbia,
Colombia, Brazil, Japan, and China. The
[Additional information. Misha author’s reports are brisk and
Glenny has earned a reputation as one informative. They are rich in detail but
of the leading journalists covering the avoid technical issues. Glenny gains the
Balkans. Born in 1958, he is the son of reader’s trust, and it would be difficult
Michael Glenny (1927-1990), a Russian not to admire the courage with which he
studies academic and translator. Misha has pursued inherently dangerous
is the Russian diminutive of ‘Michael’; his stories. He has a sense of history and
name has contributed to a myth that he the big picture, and an interest in ways of
has Slavic connections, but in fact he is conceptualizing the activities of the
British. His mother’s family was from criminal underground. These he
Sussex. He was raised in “arty-farty” generally regards as due to social
circles in Notting Hill in London. His circumstances (structures, not national
parents separated when he was 13. He characteristics) rather than inherent
attended Magdalen [pronounced ‘mod- human depravity—except in the area of
lin’] College School in Oxford before prostitution.]