The Threat of Russian Organized Crime
James O. Finckenauer and Yuri A. Voronin
Washington D.C.: U.S. Department of Justice, 2001
33 p.

Subject, Methods, Database:
A short treatise on Russian organized crime in general and organized crime in the Yekaterinenburg area in particular. Data were obtained from official and media sources.

Organized crime in Russia is an institutionalized part of the political and economic environment. It grew out of the Soviet system in which members of the state elite developed mutually beneficial personal relationships with criminals. In the late 1960s a three-tiered edifice began to take shape. The top level was occupied by high-level government and party bureaucrats. The second level consisted of underground or shadow economy entrepreneurs who operated outside the state-command economy. The bottom level were professional criminals who ran activities such as drug dealing, gambling, prostitution and extortion. When private enterprise, in the form of cooperatives, was encouraged under Mikhail Gorbachev, the people best positioned to take advantage of this new opportunity were the criminals, the underground entrepreneurs and corrupt bureaucrats. Toward the end of the Gorbachev period, high-level party officials began to siphon off Party funds into banks, trading companies, and export-import firms. The privatization of state property that began in Russia in 1992 both expanded and solidified the complex relationship between officials and criminals. Today, organized crime in Russia uses legal businesses as fronts for illegal activities and for setting up illegal product lines. It creates "political clans" to exercise political power and seeks to create and regulate markets to exercise economic power.
Yekaterinburg (Sverdlovsk), situated in the Ural Mountains, is the largest industrial center in Russia and known as its "gangster capital". Three major networks dominate criminal activities, the "Uralmash criminal community", the "central criminal group", and the "blues criminal community". The former two are made up of white-collar criminals who are involved in illegal dealings such as the illegal export of nonferrous metals, and in legal businesses, including restaurants and insurance companies. The latter network is the most numerous and consists of professional criminals, including vory v zakone. They engage in traditional crime but have also gained a foothold in a number of areas of licit economic activity, for example gas stations. Both sides, white-collar criminals, employing former athletes, police officers and military personnel as muscle, and professional criminals, are in violent conflict. The gangs specialized in violence will undoubtedly continue their criminal exploits, but it is unlikely that they will rival the power and influence of such economic criminal networks as Uralmash. As a result, the vory v zakone will continue to have less influence in the Urals than in any other region of Russia.
Because of the corruption and ineptitude of government, those segments of the society that one would normally expect to oppose organized crime-public organizations, political movements, and the population at large-instead support it. Ironically, organized crime provides stability and fuels the economic engine. This stability and economic stimulation, however, come at a very dear price in the long run.
The greatest threat to the West arises from the expansion of Urals-based criminal activities abroad. The most enterprising of the criminal networks in the Urals are rapidly transforming themselves into transnational criminal organizations. They take their substantial capital and look for opportunities to launder their money and pursue various kinds of business and criminal activity on the global scene.
As the transnational groups accumulate money, power, and influence, government agencies charged with combating them are actually declining in capacity and effectiveness. What is more, at all levels of government the political will necessary to tackle the problem seems to be distinctly lacking. As a result, it can be expected that organized crime networks will only become stronger and more powerful in the near future.

The Russian Mafia plays the bogey man role in the contemporary discussion on organized crime. There is a lot of tough talk but little empirical data and differentiated analysis. Finckenauer and Voronin take up the challenge and provide a close-up look at a specific region of the Russian Federation to explore what organized crime really looks like. The most striking finding they produce is that the vory v zakone occupy a rather marginal position in the overall picture and that white-collar criminals, using their superior financial powers, have apparently managed to establish a potential for violence independent from both the government and traditional criminals. It remains to be seen whether the white-collar criminals will continue to maintain this independence or whether they will eventually merge their capacities with those of the state to legalize their status. In the long run it may prove most beneficial for the now illegal entrepreneurs to have their assets protected by a strong government with an undisputed monopoly of violence. Therefore, the developments we can observe might be better interpreted as a process of state building than as the expansion of power of criminal networks. It would be worth reevaluating from this perspective the data that Finckenauer and Voronin present.

Overall evaluation:
A valuable contribution to the study of Russian organized crime. The short format of the treatise has its advantages though in some regards one would like to learn more details and have more precise information. It is not clear if the available data base permitted a more extensive treatment of issues such as the inner structure of the crime networks, the relations between criminals and public officials and the connection between traditional criminal endeavors and economic crimes.

Further Reading:
Finckenauer, James, and Elin Waring, Russian Mafia in America, Boston: Northeastern University, 1998. (read review)
Galeotti, Mark (ed.), Russian and Post-Soviet Organized Crime, Aldershot, England: Ashgate, 2002.
Varese, Federico, The Russian Mafia: Private Protection in a New Market Economy. Oxford, UK: Oxford University Press, 2001.

© Klaus von Lampe, all rights reserved.