NCJ Number
204376
Date Published
2004
Length
7 pages
Annotation
This chapter discusses the entanglement of businesses and organized criminal networks in Ukraine.
Abstract
Businesses in Ukraine, following Ukraine’s independence from the former Soviet Union, are increasingly being targeted by organized crime groups. Businesses are vulnerable for criminal exploitation in Ukraine because of the political, social, and economic unrest which has resulted in a weak government infrastructure and little to no regulation of businesses or criminal activity. Thus, as many as one out of every two Ukrainian businesses is criminally controlled and avoids paying taxes because of poor government control. In return, businesses are freed from the instability of state law and regulation and tend to turn much larger profits thanks to their illegal activities. Business owners are placed in a difficult position when they are forced to chose between a weak and ineffective government (and possible bankruptcy because of the unstable economy) and organized crime groups that can offer protection and a healthy profit margin. Throughout the chapter, the author illustrates how businesses and organized crime networks form a strange symbiosis in which corrupt businesses benefit because they no longer must depend on a weak state and an uncertain economy. The author contends that organized crime and the victimization of businesses in Ukraine are both deviant forms of adaptation brought about by changes in the social structure. Survey results derived from the United States-Ukraine research partnership are offered. A telephone survey was conducted with 500 businessmen in the Black Sea port city of Odessa in 1999 and a personal survey was conducted with 100 businessmen involved with the Odessa clothing market to discover the extent of victimization among the businesses. While only 3 percent of businessmen considered criminal groups an interference, 27 percent had contracted with the State Protection Agency and another 21 percent had contracted with a private protection agency to keep their businesses safe from blackmail. Types of criminal victimization reported were hooliganism, blackmail and extortion, bodily injury, theft, and fraud. Businesses that are targeted by criminal groups are chosen based on their economic condition and their involvement in activities attractive to criminal groups. Further research on the dynamics and characteristics of business victimization is needed to develop monitoring systems to help prevent further victimization of businesses in Ukraine. References