Organized Crime Research (kvl-homepage) The Nicotine Racket. Trafficking in Untaxed Cigarettes: A Case Study of Organized Crime in Germany, by Klaus von Lampe

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The Extortion of Vietnamese Street Vendors

The victimization of Vietnamese Street Vendors: An Overview

The trafficking in untaxed cigarettes is a profitable business down to the street level. The profit margin for street vendors, according to various sources, ranges from 2 to 10 Deutsche Marks per carton of 200 cigarettes. One street vendor interviewed by a journalist in 1995 reported that at lucrative spots up to 600 cartons could be sold in a single day for a profit of 2 to 4 Marks each while less attractive vending places were still good for selling 10 to 20, sometimes 100 cartons a day(52). This would amount to monthly earnings from several hundred to several thousand Deutsche Marks.

The profitability of the business combined with its visibility and illegality make street vendors of untaxed cigarettes a likely target for predatory criminals. In fact, early on Vietnamese street vendors have been victimized in two distinct ways. On the one hand they were targeted by right-wing-extremist juveniles, on the other hand they became victims of Vietnamese extortionists.

In the early 1990s, Vietnamese street vendors were frequently assaulted by young Germans(53), partly to rob cigarettes and money, partly to take the law into their own hands, but mostly for racist motives(54). These attacks were one expression of a broad wave of xenophobic violence Germany, and especially East Germany, experienced in the years following reunification(55). Vietnamese in general, as the largest group of foreigners in East Germany, and not only vendors of cigarettes, were primary targets of these racist assaults. Towards the mid 1990s the wave of violence against Vietnamese ebbed away. For 1996 a Berlin based Vietnamese self-help group reported only some 20 incidents compared with around 1,000 assaults during 1992(56), while at the same time internal violence of increasing proportions and brutality took hold of the Vietnamese community.

Between June of 1991 and the End of 1992, the Berlin police, for example, registered 28 cases of brutal robberies among Vietnamese(57). In December of that same year the first of a series of homocides occurred in the city(58). In 1993 the number of homocides within the Vietnamese community in Berlin rose to 3 and then doubled in each of the following two years to 6 in 1994 and 12 in 1995 to reach a high in 1996 with 15 homocides related in one way or the other to the cigarette business(59). In other parts of East Germany a similar development could be observed(60). At first the violence was largely attributed to competition between cigarette dealers(61), but soon the notion prevailed that the rivaling parties were actually extortion gangs who fought over territories in which they extracted protection payments from street vendors.

The History of Vietnamese Extortion Gangs

The beginnings of the Vietnamese extortion gangs are blurred. According to one source, their origins date back to early 1990 when contract laborers from the poor central Vietnamese provinces organized in an "Association of the Benefactors" for protection against North Vietnamese who tried to hold on to the privileges they had enjoyed in East Germany as the sons of functionaries of the Hanoi regime(62). The North Vietnamese formed the "Association of the Unified Military Provinces" and began to systematically rob and extort Central Vietnamese cigarette vendors. In the ensuing conflict the North Vietnamese were eventually driven out of the Berlin area into southern regions of East Germany (Saxony and Thuringia)(63), but not before they had succeeded in killing the leader of the "Benefactors" in April of 1993. After the death of its leader the "Association of the Benefactors" fell apart and split into several smaller groups, formed along regional lines who turned to extorting those they had once set out to protect(64). Street vendors could no longer operate without paying some sort of tribute to extortion gangs. In the following years two major factions among the Central Vietnamese evolved with about 50 strong-arm men on each side. At the hight of its power in 1996, the largest of the two factions under the leadership of a 25 year old supposedly controlled 800 of the 1,200 vending places in Berlin(65).

The conflict between the rivaling factions culminated in a virtual gangland war in late 1995 and early 1996. Just before Christmas on a weekday afternoon one Vietnamese was killed and two seriously injured in a shoot out on a busy street in East Berlin. Stray bullets grazed a passer-by and hit two passing cars(66). In May of 1996 the war reached its climax when six Vietnamese, known to the police as vendors of untaxed cigarettes, were shot to death in an East Berlin apartment. As investigators found out later, the killers had tried to learn the whereabouts of a gang leader to take revenge for the murder of one of their own vendors three days earlier. In retaliation for the mass murder three vendors aligned with the opposing faction were killed execution style two days later(67).

The escalation of violence provoked dramatically intensified law enforcement efforts. Already in 1994 a special unit had been formed by the Berlin police to centralize all investigations involving Vietnamese criminals. In April of 1996 the unit was reinforced by a homocide squad and given almost unlimited access to personal and logistic ressources enabling them to organize a more relentless pursuit of street vendors and a more intense surveillance of the behind-the-scenes movements of gang members. As a consequence Vietnamese criminals were forced to adopt more conspiratorial methods to conduct their businesses if they were not forced out of business altogether. At the same time the police succeeded in winning the trust of potential witnesses. Several Vietnamese came forward to testify against murder suspects. By the end of 1996 the leaders of the two dominating gangs and several top members were arrested. In the summer of 1997, after another six gang members had been captured, the special police unit targeting Vietnamese criminals was disbanded(68).

Today several smaller groups of hardly more than 10 members each are believed to extort the remaining street vendors. Violent conflicts have flared up occasionally, causing the police in February of 1998 to reinstitute a detective unit charged with monitoring the Vietnamese underworld. But no gang appears to be strong enough to gain a position comparable to that of the large gangs dominating in the mid 1990s(69).

The Structure of Extortion and Extortion Gangs

The gangs involved in the extortion of cigarette vendors do not themselves participate in the trafficking of untaxed cigarettes, except for allocating selling spots within their respective territories. Whoever wishes to become a vendor has to contact the local gang to negotiate a monthly "tax" to be paid in exchange for the right to sell cigarettes provided by a third party. The amount of money charged depends on the profitability of the location and may range from several hundred up to several thousand Deutsche Marks(70). The gangs usually appear on the scene only to collect the monthly payments(71).

In most publications the structure of the extortion gangs is described in the terminology typically applied to ethnically defined organized criminal groups. They are said to be "tightly," "hierarchically," and "military like" organized. The police differentiates four hierarchical levels, the gang leader at the top who directs several so-called sub-leaders. They in turn command a number of "soldiers" among which especially trusted "elevated soldiers" stand out(72).(Slide: The Structure of Extortion) Additional functions are performed by service providers and middlemen who are not regarded as gang members. They assist gang members in matters like procuring legal documents, housing or transportation. With regard to the sale of untaxed cigarettes gangs apparently use individuals who are themselves vendors to collect extortion payments from the vendors in a particular area(73).

According to one source, some of the dominating gangs of the mid 1990s were functionally departmentalized insofar as sub-leaders and their respective underlings were charged with carrying out certain duties, for example as enforcers or internal security officers. Larger gangs in general seem to have been at least geographically departmentalized in the sense that certain soldiers were assigned to control certain vending places(74).

Extortion gangs are exclusively of male membership. Women only play a role as the lover of a boss(75). The cohesion among gang members is supposedly based on regional affiliation, that is the mutual origin from a village, city or province, not on family ties(76). Violence apparently also plays a role in maintaining internal discipline, as authorities believe some of the violence of recent years to be acts of retaliation against traitors(77).

Many questions about the internal structure of extortion gangs remain unanswered. For example, it is not clear how gangs recruit new members, what requirements prospective members have to meet and through what kind of initiation procedure they have to go through.

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