Ukraine - Organized Crime
In Ukraine, a political-criminal-business troika, consisting partly of dense network connections among key people in the three sectors and partly of some figures straddling the three sectors, engaged in politics, licit commerce and illegal business. Although the number of organized crime groups in Ukraine steadily decreased, the remaining groups are proving much more difficult to eradicate. The situation in Ukraine is characterized by seamless webs between licit and illicit business and between criminals on the one side and political and bureaucratic elites on the other. The triangular relationship is an alliance of convenience rather than of natural affinity, but the benefits are so deep that the relationship has become institutionalized. Because there was little clarity in the demarcation of legal and illegal, public and private; and permissible and prohibited, the stability and durability of the triangle are likely to continue unhindered.
Most organised criminal gangs uncovered by the authorities operated in Crimea and the eastern provinces of Donetsk and Luhansk; and also in the bordering south-eastern province of Zaporizhia and Odessa province on the northern coast of the Black Sea. The presence of traditional organised crime groups in Ukraine is declining. Those organised gangs which do exist are mostly involved in human trafficking, drug trafficking, cyber crime, corporate raiding and smuggling of products to the European Union.
One major node along illicit weapons trafficking routes has traditionally been the port of Odessa, out of which notorious arms trader Leonid Minin operated in the 1990s in concert with Odessa organized crime boss Aleksandr Angert (criminal nickname “Angel”) to deliver weapons to Charles Taylor in Liberia, the RUF, and others. The Moscow-based Solntsevo network, Russia's largest and most powerful mob, had a long-standing relationship with the "Donetsk clan," an infamous political-criminal circle in the eastern Ukrainian city of the same name and scene of much recent fighting.
The sea port of Odessa is an infamous trafficking conduit through which vast quantities of illegal Europebound Afghan heroin transits. In western Ukraine meanwhile, organised crime gangs there were equally active moving drugs and people and other contraband. In March 2014 a Donetsk prosecutor warned that "through crime networks (Moscow) has an army of hoodlums it can use." In the wake of the Maidan revolution, east Ukraine has descended into chaos: providing fertile ground for organised crime gangs to extend their influence. With the attention of Ukrainian authorities focussed on their conflict with pro-Moscow rebels, organised criminals have been able to consolidate and expand lucrative human trafficking and drugs smuggling routes.
The Russian annexation of the Crimea had serious potential implications for the criminal environment in the region and conceivably even globally. ‘Crimea has long had a reputation as a relatively criminalized peninsula, not least as its local authorities resented their subordination to Kiev and worked often poorly or at odds with national law enforcement. New Crimean premier Sergei Aksenov has been widely identified as a former gangster from the ‘Salem’ organized crime group, who went by the nickname ‘Goblin’ in the 1990s. The infamous Moscow-based Solntsevo group has run smuggling operations through Sevastopol, for example, as have many others.
Although Ukraine is not a major drug producing country, its location astride several important drug trafficking routes into Western Europe leaves it vulnerable as an important transit country. Ukraine's numerous ports on the Black and Azov seas, its extensive river routes, and its porous northern and eastern borders make Ukraine an attractive route for drug traffickers into the European Union’s illegal drug market.
It is an error to think of them as structured organisations on the model of the Sicilian mafia or the Japanese Yakuza. "They are as much as anything else clubs and contact markets, comprising inner core groups tied to key figures, semi-autonomous other gangs, local franchises, semi-independent contractors, corrupt patrons and some-time customers of their services. It is often very hard to say where one ends and another begins, or who is 'in' which," writes organised crime expert Mark Galleotti.
One of the many paradoxes of the Soviet era, and one that continued to have considerable impact on the politics and economic of post- Soviet states, was the systemic repression of any legitimate economic enterprise coupled, in the later years of the Soviet Union, with a tacit condoning of various forms of illegal economic activity. This combination meant that the post-Soviet states were ill-prepared for the development of free market economies in terms of legitimate entrepreneurship and that corrupt and criminal enterprises were well-placed to exploit the new conditions.
Corruption provides a congenial environment with a high level of impunity, while infiltration of law enforcement is useful insurance that provides advance warnings of investigations in those instances where corruption alone does not suffice to provide total protection. Organized crime in Ukraine has become a significant political and economic force, developing collusive and corrupting relationships with the political elite and exerting influence over many sectors of the economy. Although these criminal elements were present in the Soviet system, the elites were able to control and, in some cases, harness them for their own benefit. In the post-Soviet world, however, these phenomena have become more powerful in their own right while also merging with centers of political and economic power.
Organized crime has delayed if not derailed Ukraine’s successful transition to a democratic polity and a free market economy, has generated considerable violence and corruption, and has contributed significantly to the development of a climate that inhibits rather than encourages foreign investment. The extension of organized crime into government has also helped to neutralize some of the state’s powers, making it difficult for the Ukrainian state to function effectively. At the same time, alliances between leading political figures and criminal organizations have given politics in some regions of Ukraine a particularly vicious quality.
In April 1998, just afew weeks before Ukraine was to host the annual meeting of the European Bank for Reconstruction and Development, Vadim Hetman, chairman of Ukraine’s currency exchange and widely regarded as the key architect of Ukraine’s National Bank was the victim of a contract killing. Hetman was due to speak at the EBRD meeting and his death was interpreted as another deterrent to foreign investment in Ukraine. Some observers even suggested that Russians who wanted to invest in Ukraine were responsible and that they had killed Hetman to make Ukraine look unattractive to Western investors.
In September 2000, the head of the Kievpolice, Col-Gen Yuriy Smirnov, told a working meeting of the Kievpolice leadership and heads of district state administrations that Kiev had “become an asylum for rogues, prostitutes and drug addicts ”. Although four main criminal gangs had been dealt with, another 12 gangs continue to operate with around 60 enterprises, including some banks, under their control. The deputy interior minister of Ukraine, added that the authorities had proved helpless to deal with this, with the result that criminals were becoming stronger and more blatant. They have even “become sponsors, people’s deputies of all levels and speak on television ”. Perhaps most important of all, Smirnov noted that the Ministry of Interior’s directorate for combating organized crime had been compromised and that “protection ” for criminal gangs had been established.
The growth of organized crime in Ukraine since the collapse of the Soviet Union has been significant. In an analysis of Ministry of Interior statistics for 1991 -2000, for example, Alexander Kulik (2001) noted that organized crime investigations increased from 371 to 960 while the number of cases opened increased from 1,843 to 7,744. Moreover, between 1995 and 2000 the number of organized crime members who were prosecuted increased from 2,980 to 4,074. While some of these increases might reflect increases in the efficiency and effectiveness of law enforcement, they also reflect the expansion of organized crime.
The law enforcement system in Ukraine consisted of agencies lacking adequate resources and poorly trained for their new responsibilities. These agencies face formidable adversaries: criminal organizations have abundant resources, are excellent at discovering new entrepreneurial opportunities and have some excellent defense mechanisms, including their use of corruption and violence. In 1993, however, a criminal code was adopted addressing law enforcement activities against organized crime. The law began the process of leveling the playing field: it enabled authorities to seize the assets of criminal businesses and to use the courts to then shut them down, it provided for surveillance powers, and it defined procedures for search and seizure.
It is not coincidental that Ukraine had a shadow economy that in the 1990s was believed to account for somewhere around 50 percent of the overall economy. Much of this is informal economic activity that is simply not recorded or taxed by the state. The shadow economy, however, includes not only informal but also illegal activities. Becoming a member of a criminal organization is an alternative career path and one in which risks are outweighed by the potential gains. This has been particularly true for “sportsmen,” the wrestlers, karate experts, weightlifters, and others who often provide the lower level muscle for criminal organizations, as well as for former intelligence and special forces personnel who provide criminal organizations the more sophisticated methods of intimidation and elimination.
Organized crime in Ukraine is a “highly differentiated phenomenon” with important regional and city variations. The predominance of organized crime is at the local level. One 2001 study found that 41 percent of organized crime groups were locally oriented in their operations compared with 27 percent district-wide, 18 percent nationwide, and 8 percent that were international in scope. Transnational criminal organizations operate in and through Ukraine.
Organized crime in Ukraine has a particularly violent quality. Generally, the victims fall into one of the following categories: businessmen who are resisting efforts by organized crime to infiltrate, control or extort their company; businessmen who have failed to pay debts, or are vying for control of a particular market sector or even an entity involved in privatization; politicians and officials who are engaged in criminal activities and thereby make themselves potential targets of the criminal world; local officials and law enforcement personnel who promote reform and challenge criminal dominance in particular towns and cities, or in particularly economic sectors; investigative journalists who threaten to expose criminal activities; or criminals who are targeted by rival organizations. Victims can be a business or a criminal rival of the perpetrator (i.e. the person who hires the murderer), a threat (for example, because of information they might have or be in the process of obtaining), or an obstacle. In some cases, however, a victim of a contract killing can simply be chosen to coerce others into acquiescing to particular demands by an organized crime group.
On the surface, today’s Ukraine has moved past the rule of organized crime groups and the highly publicized contract killings of the lawless 1990s. But the small group of individuals who own much of Ukraine’s wealth today almost all got their start in this lawless era, and most of them amassed their early fortunes through illicit activities, alliances with organized crime groups, and theft of state assets...Over time, the tools of economic capture have become more sophisticated: instead of armed gangs, there are lawyers and notaries creating fraudulent ownership claims and falsified proxy battles, using multiple layers of shell companies served by off-shore banks. Still, the threat of violence underlies much of the corporate raiding that continues today, even if it has receded into the background.
The “made man” is a high-ranking and respected professional criminal who has formally accepted the thieves’ code. Ukrainian organized criminal groups share the idea that the made man is a highly principled criminal - similar to the positions of honor within the Italian Mafia. Initiation of the made man occurs only after a long period of information gathering about the candidate and an oath that endures for life is taken. While initiation is thought to be a rare event in Ukraine, made men play a central role in the organization of the network of criminal groups in Ukraine and in criminal activity abroad. Tattooing and jargon have more recently become the prerogative not of the elite criminals, but of the lower criminal classes.
Organized crime in Ukraine has matured from the street-gangster type shootouts of the 1990s to corporate raiding and the development of largescale capital-based oligarchic structures. Many of the surviving criminal leaders have gone legal and are now “legitimate businessmen” and/or politicians, who use media acquisitions, the new “anti-libel law” and parliamentary immunity to discourage anyone from taking a close look at their past and at their current activities. And the state security apparatus has been sufficiently revived so that Ukraine no longer has the organized criminal bands of the 1990s which were able to smuggle sophisticated weapons or large quantities of drugs without little or no involvement from the state. Traditional high-level organized criminals (vory-vzakone, or “thieves-in-law”) are on the sidelines, playing little role in “high politics.”
To some extent, traditional organized criminal activity has also been taken over by the representatives of formal institutions such as the police and other security services. The involvement of law enforcement personnel in organized crime has become such an acute issue that MPs started discussions on criminalizing “werewolves in epaulettes’’, a term that has often been used to describe various configurations of police-dominated criminal organizations.
|
NEWSLETTER
|
| Join the GlobalSecurity.org mailing list |
|
|
|
