NCJ Number
171299
Journal
Transnational Organized Crime Volume: 3 Issue: 1 Dated: (Spring 1997) Pages: 23-38
Date Published
1997
Length
16 pages
Annotation
This article examines extortion and organized crime in Russia and the effect on large-scale foreign investment.
Abstract
Extortion in Russia has reached levels that will deter large- scale foreign investment. There are not sufficient laws in place to protect foreign, or domestic, businesses from extortion demands, and the existing laws are not rigorously enforced. While extortion is part of a larger problem involving the role of organized crime within the emerging state, it is now so pervasive that its effects merit special attention. The Director of the Federal Bureau of Investigation told the US Congress in 1996 that most American businesses in Russia were paying up to 30 percent of their profits as protection money to organized crime groups. Until action is taken to cut the crime in Russia to more manageable proportions, a certain acceptance of extortion will be part of the price of doing business there. This has implications for Russia's future, because foreign investment is essential to reinvigorate the Russian economy. Without a stable and more dynamic economy, Russia will have great difficulty instituting and maintaining democratic and market reforms. Notes