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  HOME | Opinion (Click here for more)

Beatrice Rangel: Could the US RICO Act Be Applied to Latin America?

By Beatrice E. Rangel

It is amazing to witness how little thought has been given outside the realm of law enforcement organizations to the perverse effects of globalization.

Indeed, from Thomas Friedman to Henry Kissinger we have been made aware of the virtues and transforming powers of globalization and the flat world it has created. But little have we read about what a blessing the flat world has been for organized crime and terrorist organizations.

Because just as TV production techniques and distribution channels have become so cost effective that they are accessible to almost anyone with a Smartphone, criminal activities have also benefited immensely from this cost reduction in operations.

Drug traffickers, for example, enjoy such immense margins that they can indulge in compulsive shopping for aircraft. It has been estimated that demand for small and medium size aircrafts is fundamentally driven by drug traffickers who, on average, use the planes three times before crashing and/or burning them to ashes.

Just as computers and chips become more efficient so do terrorist and other criminal organizations.

And they have grown so much that are now practicing a healthy bit of M&A activity with access to advisory services from unsuspecting bankers that believe they are serving a family office or a living trust.

The enhanced penetration capacity by these organizations should promote an in-depth revision on what can be done to halt or at least neutralize their disruptive and destructive capacities.

This becomes all the most urgent when it's palpable clear from daily headlines all over the hemisphere that whatever it is that we are doing is simply not working.

Cocaine production has steadily climbed since 1993.

Terrorist attacks have spread since 9-11.

And this is just the beginning of the road towards the era of semantic networks when communications will be as fast as thoughts (see graph).

Because we can't possibly monitor all exchanges taking place in the world, we need -- as a world community -- to increase the cost of crime. And this means making association for crime very costly. This takes us to a piece of legislation that is about to turn 45 and that has served the purpose of controlling organized crime in the US.

Passed in 1970, the Racketeer Influenced and Corrupt Organizations Act (RICO) is a US federal law designed to rein in organized crime. The RICO ACT opens the field for prosecution and civil penalties for racketeering activity performed as part of an ongoing criminal enterprise. Such activity may include illegal gambling, bribery, kidnapping, murder, money laundering, counterfeiting, embezzlement, drug trafficking, slavery, and a host of other grubby business practices.

To convict a defendant under RICO, the government must prove engagement in two or more instances of racketeering activity and that the defendant directly invested in, maintained an interest in, or participated in a criminal enterprise affecting interstate or foreign commerce.

So far the RICO Act is only applicable in the US. Criminal organizations thus take good care of avoiding performing racketeering activities in US soil.

In the US, on the contrary, they create legal and solid law abiding enterprises that generate "clean income" which can then be transferred abroad to a network of unsavory organizations that engage with gusto in money laundering, human trafficking, currency and document counterfeiting, and, of course, kidnapping and murder.

Reading this week's hemispheric headlines one wonders whether the time is not ripe for a regional adoption of the RICO Act.

These headlines include but are not limited to:

  • the virtual stone walling of the murder of a prosecutor in Argentina;
  • a fraud in Petrobras, the Brazilian energy titan that virtually evaporated $21biilion of the company's income;
  • the hostile takeover attempt of the Canadian energy multinational Pacific Rubiales by a bunch of previously unknown energy entrepreneurs who seem to have cozy relations with the Bolivarian ring leaders in Venezuela;
  • the resignation of Roxanna Baldetti, Vice President of Guatemala amid a corruption scandal involving manipulation of custom duties
  • the revelation by Spanish financial authorities, US law enforcement agencies and protected witnesses who fled that Venezuela is run by a drug cartel which would be the envy of Pablo Escobar, the Colombian capo di tutti capi.

With a regional extension of the RICO Act, perpetrators of these crimes would have nowhere to practice racketeering. Further, one could think of recuperating the money made through illegal activities to fund the United Nations Development Program (UNDP) which is almost about to give up for lack of funding. This would be a wonderful way to begin correcting some of the more perverse effects of globalization.

Also by Beatrice Rangel in her Latin America from 35,000 Feet series

Beatrice Rangel: On the Discreet Charm of Commodities for Latin America

Beatrice Rangel: The End of the Chinese Free Lunch in the Americas!!

Beatrice Rangel: The Crooked Twig of Democracy in the Americas

Beatrice Rangel: Of a White Knight for Three Latin American Ladies in Distress

Beatrice Rangel: Withdrawal Symptoms?

Beatrice Rangel: The Un-Mannered Summit

Beatrice Rangel: Easter Miracles in Latin America and the World

Beatrice Rangel: Two Islands, Two Legacies & One Challenge - Modernity

Beatrice Rangel: Killing Me Softly -- the Obama Administration’s Legacy in Latin America

Beatrice Rangel: Of Upcoming Dynasties and Exhausted Ideas in Latin America

Beatrice Rangel: Of Thunderous Silences, Quiet Noises and Flash Backs in Latin America

Beatrice Rangel: Latin America's Dangerous Exports to Europe & the Demise of an Old Fox

Beatrice Rangel: Of Sweet Deals, Sugar Daddies, Direct Mail & Obama’s Care

Beatrice Rangel: Of Latin American Singing Birds, Femme Fatales & Empty Shelves

Beatrice Rangel: When Flying Dragons & Rage Infusions Turn Against Their Latin American Masters

Beatrice Rangel: Holy Haberdashery!!! Is Fire Building Under the Surface in the Americas??

Beatrice Rangel: 2015 -- A Year for Balance in the Americas???

Beatrice Rangel: Pope Francis Looks at the Americas In His Christmas Remarks

Beatrice Rangel: The Paint Brush Hanging from the Wall in Latin America

Beatrice Rangel: A Future for the Americas??

Beatrice Rangel: Going Forward, Going Backward -- It's the Americas!!

Beatrice Rangel: An Eerily Familiar Week in the Americas

Beatrice Rangel: Tale of Two Walls

Beatrice Rangel: Across the Americas, We the PEOPLE

Beatrice Rangel: Across Latin America, The Populist Beat Goes On!!

Beatrice Rangel: Oh My, The Patron of the Eternal Feminine Has Left Us!!!

Beatrice Rangel: Communism from China to Cuba Finds Corruption!!!

Beatrice Rangel: From Rio to Hong Kong Discontent Taps the East to Find a New Way

Beatrice Rangel: Will Latin America Miss the Broadband Development Target?

Beatrice Rangel: Kissinger’s World Order and Latin America

Beatrice Rangel: The Third Attempt -- Will Modernity Prevail in Latin America?

Rangel: While US is Away, Latin America Rethinks Development Paths

Rangel: In the Midst of Riots, a Star is Born in Brazil

Rangel: In Mexico Cinderella Gets to the Ball while Colombia Gets a Chance at Peace

Beatrice Rangel is President & CEO of the AMLA Consulting Group, which provides growth and partnership opportunities in US and Hispanic markets. AMLA identifies the best potential partner for businesses which are eager to exploit the growing buying power of the US Hispanic market and for US Corporations seeking to find investment partners in Latin America. Previously, she was Chief of Staff for Venezuela President Carlos Andres Perez as well as Chief Strategist for the Cisneros Group of Companies.

For her work throughout Latin America, Rangel has been honored with the Order of Merit of May from Argentina, the Condor of the Andes Order from Bolivia, the Bernardo O'Higgins Order by Chile, the Order of Boyaca from Colombia, and the National Order of Jose Matías Delgado from El Salvador.

You can follow her on twitter @BEPA2009 or contact her directly at BRangel@amlaconsulting.com.


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