Colombia's gangs cash in with 'micro-extortion'
Criminals in Colombia are extorting payments of as little as $10 a week from local businesses. The sums are too small for victims to want to report, but can add up to huge profits for gangs.
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The other big moneymaker for gangs – especially those which make up Medellin's biggest mafia, the Oficina de Envigado – is the extortion taxes demanded from bus companies. On July 22, the bus companies that service Medellin's hillside barrios went on strike, protesting the various vacunas they had to pay to competing gangs – 70,000 pesos (about $40) in one section of a comuna, 38,000 pesos (about $20) in another. One transport minister told El Colombiano that an estimated 80 percent of all buses in Medellin pay an extortion tax. Drivers who do not collaborate see their vehicles burned, and can be killed.Skip to next paragraph
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The "micro-extortion" that afflicts Medellin's public transport is one reason why the city government is considering implementing a cashless payment system. "The logic of micro-extortion is the size. It's so small that people think it's better to pay up, and more costly, shameful, and risky to report it," Defense Minister Rodrigo Rivera said in a March interview with El Colombiano, arguing in favor of the reform.
Street workers in Medellin also pay their own vacunas. Those at the bottom of Medellin's economic ladder – the street vendors hawking chewing gum, cigarettes, or cell phone minutes – must reportedly pay between 500 and 5,000 pesos (25 cents to $2.50) a week. Even the mariachi bands found along Medellin's Carrera 70 must pay for the right to work, with groups handing over as much as 150,000 pesos (about $83) for the right to do business on popular holidays like Mothers' Day.
One study by C3, a local NGO that studies urban conflict, found that in Medellin's central comunas alone there are an estimated 41 street gangs who charge vacunas from virtually every informal business. The total profits may be as high as $1 million a month, the study says.
Cracking down on these small-scale extortion payments is tough, precisely because the size of the "tax" is low enough for victims to tolerate, rather than taking the risk of reporting it to authorities. If a city like Medellin were to succesfully install a cashless bus system – perhaps forcing the gangs into demanding larger, monthly payments rather than smaller, weekly ones – this could make it harder for transport companies to tolerate the vacunas. Halting the extortion of workers in Colombia's informal economy will prove more difficult. At the moment, the benefits of giving in and paying the extortion tax outweigh the risks of not paying. It is up to the Colombia security forces to switch these incentives around.
--- Elyssa Pachico is a writer for Insight – Organized Crime in the Americas, which provides research, analysis, and investigation of the criminal world throughout the region. Find all of her research here.
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