The Mafia Is Italy's Biggest Business

Mafia's business interests infiltrate the tourism, restaurant industries.

November 12, 2008, 12:43 PM

ROME, Nov. 12, 2008 -- Organized crime is the biggest business in Italy, according to the latest study by the country's shopkeepers association, Confesercenti.

That Italy's mafias do a booming business, particularly the drug-related variety, is common knowledge. But the effect on the country's legitimate businesses such as tourism and food production had not been as clear until the Confesercenti released the figures, which are staggering.

Italy's four organized-crime syndicates -- Sicily's Cosa Nostra, the Camorra in Naples, Calabrian 'Ndrangheta, and the Sacra Corona Unita in Puglia -- together make up a "huge holding company with a total [sales] turnover of about 130 billion euros [about $165 billion] and profits approaching 70 billion euros [about $90 billion]," after investments and expenses, according to the study.

They are, effectively, the biggest company in Italy. "Everyday, organized crime takes some 250 million euros (about $317.5 million) away from retailers and businessmen," the study said. "The equivalent of 10 million euros [about $12.7 million] an hour, or 160,000 euros [about $203,000] a minute."

Drug trafficking is still the main source of income for organized crime, bringing in 59 billion euros a year, or about $75 billion. That's followed by what's known in Italy as "ecomafia," or the illegal disposal of waste, which contributed to the recent garbage crisis in Naples.

Loan-sharking is third. It is a more recent activity for organized crime but, in a short time, it has become its biggest source of income from the business sector and it continues to grow, according to the report.

"The number of businessmen who have fallen victim to this crime has risen to some 180,000 and the offer of loans at high interest rates has created a [sales] turnover of around 15 billion euros [about $19 billion] for organized crime," the study noted

Extortion comes next, in the form of the "pizzo" -- as protection money is called -- extorted by the mob from businesses big and small, under the threat of ruin, arson and physical harm. This branch of the business is not growing, however, but only because of "a general decline in the number of legal enterprises and a rise in those controlled by mafia organizations."

The mobsters' business interests have also gone beyond the "traditional" extortion, contraband and drug dealing and infiltrated deeper into important sectors of the legitimate economy such as tourism, restaurants and food production.

Roberto Saviano, the best-selling author of "Gomorrah," which is about the Camorra -- the crime organization that operates in the area around Naples -- told ABC News in a recent interview that the Camorra is present in every kind of commercial activity.

"It is, above all, a business organization," Saviano told ABC, "in the sense that it is made up of managers, managers in the cement industry, the transport industry, managers in the industry of bread making, of pots and pans, of milk production."

The commercial empire of the combined mafias is worth about 92 billion euros (about $117 billion) a year, or 6 percent of the economy, according to Confesercenti.

Mafia businesses are set up like any other company, with a business structure that includes a CEO, managers, department heads and consultants.

The study, which gets its information from the Confesercenti's large network of members, even gives estimates on salaries of mafia members.

A "Clan chief of CEO" earns a monthly salary that goes from 10,000 to 40,000 euros a month (or about $12,700 to $50,800), while, at the lower end, drug pushers and racket operatives (protection-money collectors) make 1,500 euros per month, or about $1,900.

The going rates for protection money are also spelled out: In Sicily and Naples, construction sites fork out up to 10,000 euros (about $12,700) a month to avoid sabotage, supermarkets pay 3,000 to 5,000 (about $3,800 to $6,300) a month and small grocery stores will pay 200 to 500 euros (about $250 to $630). A simple stall at a market gets away with a few euros a day.

The ongoing economic crisis fuels the beast. "The economic crisis makes the Mafia even more dangerous, " Marco Venturi, the chairman of Confesercenti, told reporters in presenting the study.

When banks tighten their lending, businesses turn to the mob, he noted, which uses the economy's weakness and uncertainty "to strengthen its position." Companies that are financially weak are easier to buy or influence.

Italy's successive governments vow to fight organized crime with force, and Italy's latest prime minister recently sent the army to Naples to enforce law and order in the midst of a clan war.

But the new report suggests that much more needs to be done on the financial front to fight the mob's highly lucrative business activities.

At the same time, though, little victories are chalked up in some mafia-ridden parts of Italy.

This past weekend, a small farm hotel, or "agriturismo," named Terre di Corleone opened in Altofonte, in Sicily. The hotel was created from two buildings that were confiscated from Mafia boss Toto Riina, on the site of one of the Mafia's most gruesome crimes.

Giuseppe Di Matteo, the 11-year-old son of a Mafia turncoat, was kidnapped in 1993 and held hostage there for 779 days before finally being killed and dissolved in acid, in an attempt to force his father to retract his testimony.

"Giuseppe won today," his mother Franca told the media at the inauguration of the hotel. "Because I think that it is thanks to him that the mafia has been exterminated, if not totally, then at least by 70 percent. Giuseppe must help us all."

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