Mafia Channeling Funds into Desperate Banks During Global Credit Crisis

Cash-rich Mafia groups have been channelling funds into banks desperate to survive the global credit crisis, the UN anti-crime chief said on Monday.

Antonio Maria Costa of the UN Office on Drugs and Crime said he had collected ample evidence to make such accusations.

"Consultations I've had with prosecutors and law-enforcement officials around the world show there is ample evidence that the banking system's illiquidity is providing a unique opportunity for organized crime to launder their money," Costa told Reuters.

"Just about every financial centre can be characterized as part of the problem," Costa said in the interview, but declined to name countries or banks involved, saying that was for prosecutors and other law-enforcement bodies to do.

Costa said a Vienna conference next month marking the 10th anniversary of a UN General Assembly special session on drugs would mull ways to boost steps against money laundering and ease the impact of drug gang profits on the integrity of states.

He said the multilateral Financial Action Task Force (FATF) formed in 1991 did much to help drive mafia money out of banks over the ensuing decade but that achievement was being challenged by the global hemorrhaging of legitimate credit.

"You have the supply — an organized crime industry with enormous amounts of cash, estimated at $322 billion in 2005, not any more stored in banks — and the demand, a banking sector strapped for liquidity," said Costa.

"This is a supply- and demand-driven situation. Our intuition, based on logic, is now supported by ample evidence."

Asked where cases were occurring, he said: "Traditionally, Europe and North America are the places where, as financial centres, most money would be laundered.

"What we are seeing," Costa said, "is the weakening of the strongest instrument embedded in the FATF campaign, and that is, 'Know your client'. That is, accept resources only from those you know, and if you don't do so, inform the authorities.

"It has been quite widely documented that because of the difficult financial situation of banking institutions, that principle has been weakened to the point of being indirect evidence of what we are (talking about)." Costa said many member states in his UNODC agency were saying the time was not yet right for additional measures against money launderers taking advantage of struggling banks.

"I insist that the (globalized) crime industry has become so gigantic, destabilizing so many countries, that it is emerging in areas where we have not seen it before. They're buying more than just industry, real estate, elections, power," he said.

"We will present some concepts and lines of action for member states to consider when ministers meet next month, related to the size and shape of organized crime and the threat it is now posing."

Costa raised the appearance of links between the liquidity crunch and organized crime cash flows at a closed gathering of financial industry professionals in Frankfurt in November.

Britain said in December that financial sector fraud had risen alarmingly, fifteen-fold, since its credit markets began seizing up but was typically committed by internal managers and suppliers rather than organized crime.

Thanks to Mark Heinrich

Tweet

Lorenzo Giordano of the Montreal Mafia Sentenced to Prison in the Operation Colisee Case

A prominent member of the Montreal Mafia has been sentenced to 15 years in prison.

Lorenzo Giordano, 45, pleaded guilty in the past to charges of gangsterism, conspiracy and living off the profits of crime.

He was involved in helping to import hundreds of kilograms of cocaine into Canada.

Time spent behind bars before sentencing usually counts double, but the Crown agreed to allow it to count for triple in Giordano's case because he will be in isolation.

That means Giordano has about 10 years left in the 15-year sentence.

Giordano was arrested in Toronto in May 2007 as part of Operation Colisee, a widespread crackdown on the Mafia.

Tweet

Video Conference Court Hearing Held for Reputed Mob Captain Called "The Saint"

Reputed mob captain Anthony "the saint" St. Laurent faces charges of trying to pull off a gangland slaying in downtown Providence.

On Monday, St. Laurent participated in a U.S. District Court in Providence by video conference from the federal prison in Massachusetts. St. Laurent is currently serving a sentence for extortion.

St. Laurent, identified by law enforcement as Capo Regime in the Patriarca crime family, tried to hire two men to kill rival Capo, Robert "Bobby" Deluca in 2006, and again from behind bars in 2007.

In a criminal complaint obtained by Target 12, FBI case agent Joseph Degnan wired up an informant ,who recorded a 2006 conversation in St. Laurent’s house. According to the recording, St. Laurent not only told two men he wanted Deluca dead, but he said he had the permission of "the boss."

The boss, according to court documents, is Luigi "Baby Shacks" Manocchio, who runs the New England crime family from Providence's Federal Hill. St. Laurent even drove one of the men to Deluca's workplace, Sidebar Bar and Grille in Providence.

Shortly after that, St. Laurent was scooped up in a separate extortion plot. But apparently, still raging from behind bars at Fort Devens Federal Prison in Massachusetts, investigators said St. Laurent tried to solicit a hit through fellow inmates.

In a criminal complaint, unsealed on Friday, St. Laurent was charged with solicitation of murder. The FBI released a statement Friday afternoon touting cooperation between Rhode Island State Police, Massachusetts State Police, Providence Police and Boston Police.

Target 12 Investigator Tim White spoke with Deluca's attorney Artin Coloian late Friday and said his client was informed of the attempted hit and that Deluca is not concerned for his safety.

Thanks to Melissa Sardelli

Tweet