The Globalization of Russian Organized Crime

Another important trend in Russian organized crime is globalization. Expansion happened quickly after the transition- by 1993 the Russian police claimed that crime groups based in the former Soviet Union conducted business in twenty-nine nations.[1] Different parts of the world were important for Russian gangsters for different reasons. The nearby former Soviet states had all developed similar political-criminal nexuses, so many comrade criminals were able to rely on former political or intelligence service ties to create linkages across countries.[2] In particular, the Baltic countries are an important transshipment point for Russian organized crime, both for their access to the Baltic Sea and for their membership in the European Union. As Russian criminal groups expanded their operations into nearby countries, crime rates in those countries spiked, for example, in Estonia in 1994 there were 100 murders related to organized crime in a country with a population of only 1.15 million people. This was a result of gangs fighting for control over Estonian smuggling routes for precious metals, drugs, and weapons to the rest of Europe.[3]

Another important country for Russian gangsters is Israel. After 1989, the Jewish population of the Soviet Union was eligible for Israeli citizenship, and within a decade, there were more than 1 million Russians in Israel, which made up more than 15 percent of the Israeli population.[4] Israel’s large Russian population was an ideal place for criminal bosses to hide from Russian law enforcement or rival gangsters. Israel also did not have laws against money laundering in the 1990s, and did not require its banks to check on the origins of deposits, which made it an important financial hub for Russian organized crime to store and move their money.[5] The Russian criminals did not merely hide out in Israel, or use the country to launder money, but also took over the $400 million per year Israeli prostitution market, and established links with corrupt Israeli politicians.[6]

As Russian criminal groups expanded outward, they increased their links with other organized crime groups, such as the Sicilian Mafia, the Japanese Yakuza, and the American Cosa Nostra.[7] The Russian gangsters also established legitimate businesses and purchased real estate around the world. Increasing global integration and the collapse of the Soviet Union made these new ventures and partnerships possible.  During Soviet times, there were strict controls on emigration, so Russian criminals were not able to expand their reach internationally, but after the transition, the government eased these controls, making it easier for any Russian to travel abroad. In addition, with the establishment of private enterprises, it became easier for Russians to trade beyond the old Soviet bloc. Just as modern corporations were able to take advantage of improved transportation and communication networks, so too were organized criminal groups. The expansion of Russian organized crime includes several activities that threaten stability wherever it touches, including murders for hire, money laundering, extortion, smuggling of natural resources and even trafficking of weapons and nuclear materials.[8] Another major threat, as seen in Israel, is that Russian bandits will attempt to recreate their PCNs in other countries, or use, and undermine other countries financial systems to hide their political corruption.

[1] Handelman, 57.

[2] Shelley, “81.

[3] Liis Lill, “Estonia,” in Russian Organized Crime: Recent Trends in the Baltic Sea Region, ed. Walter Kegö & Alexandru Molcean (Stockholm, Sweden: Institute for Security and Development Policy, 2012), 58.

[4] Glenny, 101.

[5] William A. Orme Jr., “Israel Seen as Paradise for Money Laundering,” The New York Times, February 21, 2000.

[6] Webster, William H., Russian Organized Crime and Corruption: Putin’s Challenge (Washington D.C.; CSIS Press, 2000), 20.

[7] Fred Burton and Dan Burges, “Russian Organized Crime,” Stratfor, November 14, 2007.

[8] Handelman, 257.


About Leon Whyte

I'm a recent graduate of the Fletcher school of Law and Diplomacy. My interests include Pacific Asia and Security. I am looking for related opportunities.
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