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Managing the Mob: Techniques to Limit the Risks and Costs of Doing Business in Markets Tainted by Organised Crime

NCJ Number
Journal of Financial Crime Volume: 8 Issue: 4 Dated: June 2001 Pages: 325-331
David Reynolds; Grant Newsham
Date Published
June 2001
7 pages
This article details ways to manage the risks and costs of conducting business in financial markets influenced and affected by organized crime.
Recognizing and managing the risks imposed on financial markets by the presence of organized crime is the focus of this article. Arguing that billions of dollars were lost in 1998 by international companies’ failure to recognize organized crime, corruption, and other non-traditional risks in financials markets, the authors propose various ways to manage financial risks imposed by organized crime. Maintaining that organized crime does exist and does affect international financial firms, the authors argue that the first step in limiting the risks of doing business in markets tainted by organized crime is to identify where organized crime exists and which firms and banks are affiliated with organized crime syndicates. Suggesting that firms need to dampen their appeal to local mobsters, this article contends that blocking organized crime from the outset is the most effective means of managing risk. When it becomes necessary for international firms to enter and operate in markets permeated by organized crime, the authors propose enhanced diligence in minimizing organized crime's influence within the firm and dragging out business negotiations in the hopes that the crime group may lose interest and seek another firm. 14 References, 1 figure