global capitalism and transnational crime

Features of the global criminal economy

• Globalisation has spread capitalist values and created both legitimate and illegitimate economies

• This has produced the conditions for new types of crime to flourish

McMafia

Glenny (2009): coined the term 'McMafia' to describe how global organised crime networks operate like legitimate global businesses

McMafia - structure of the global drug economy

McMafia - origins in Eastern Europe

• After the collapse of communism in 1989, the Soviet Union deregulated most sectors of its economy except natural resources (oil, gas, diamonds, and metals)

• Former officials and KGB generals bought these resources at artificially low Soviet prices and sold them abroad at vast profits, creating Russia’s new capitalist oligarchs

• With weak state control and rising disorder, the oligarchs turned to mafias for protection and to move wealth abroad

  • These groups, often violent and fluid, ran protection rackets and expanded into international organised crime

• McMafia shows how legitimate and illegitimate economies overlap, with crime networks mimicking corporate business

The overlap between legal and illegal global economies

• Money laundering: 24-hour banking and offshore financial havens allow gangs to move illegal profits through legitimate banks

• Corruption: Global gangs may bribe or intimidate law enforcement and public officials to protect their operations

• Corporate crime: Legitimate transnational corporations also commit green crimes, damaging local and global environments

• Political impact: Transnational organised crime has funded political instability in low- and middle-income countries

  • E.g., criminal networks have been linked to military coups, such as the overthrow of President Allende in Chile (1973)

New types of global crime - containerisation

• Global shipping now uses interchangeable containers that move easily between ships, trains, and trucks

• Criminal groups exploit this system to traffic drugs, weapons, people, and counterfeit goods

• Port officials are often bribed to ensure the smooth passage of goods

New types of global crime - the Darknet

• A hidden part of the internet offering encrypted and anonymous marketplaces

• Provides access to illegal goods and services (e.g., drugs, weapons, stolen data)

New types of global crime - cyber crime

• Organised networks exploit the internet because it offers high rewards with low risks, e.g.,

  • Hacking: illegally gaining access to online banks or businesses for financial gain or political goals

  • Online scams: phishing emails and fraud to extort money

  • Viruses/ransomware: malware infects systems, and criminals demand payment to remove it

Theoretical perspectives on globalisation & crime - Marxism

• Castells (2000) observes a 'perverse connection' between global capitalism & crime

• He points to post-communist Russia in the 1990s, when the economy shifted from a centralised command system to free-market capitalism

• During this transition, corruption, speculation, privatisation, money laundering, and investment merged, as criminals took advantage of the political and economic chaos

• Castells describes money laundering as the 'matrix of global crime'

  • It is controlled by the main global drug traffickers but carried out by specialised agents working within respectable banks and financial institutions

Theoretical perspectives on globalisation & crime - late modernity

• Beck (2000) argues that the risks linked to global crime are the result of new technologies developed by industrial capitalism

• He claims that cyber and digital technologies, such as the internet, have produced a set of risks unique to the late modern era

• The main role of governments today is the management of these global risks

  • E.g., authorities aim to prevent extremists from using the internet to recruit followers or to promote their cause