Mafia hurt by asset seizures but still too strong to beat

Mafia hurt by asset seizures but still too strong to beat

11:47am EDT

By Barry Moody

NAPLES, Italy (Reuters) – Syringes litter the floor of an abandoned school in the crime-plagued Scampia district of northern Naples, alongside tin foil used for crack cocaine, a filthy mattress and piles of clothing. What was once a classroom is smeared with human waste and Coca Cola bottles filled with urine are stacked in one corner, alongside an abandoned children’s toy. For years desperate addicts lived in the school, where the local mafia or Camorra sold hard drugs from a counter. Now the building is part of a nationwide campaign to use confiscated gang assets to persuade youths from sink estates like Scampia that there is an alternative to drugs and working for the mob.But while the program by the organization Libera has scored some notable successes and saved young lives, it will never be enough on its own to turn the tide against the enormous power of organized crime, which has flourished during Italy’s worst post-war recession as the legal economy withered.

Naples magistrate Antonello Ardituro told Reuters the confiscation of assets was a vital weapon, “more important even than the arrest and conviction of bosses,” because of its visible impact in challenging mafia power.

But he added: “Naturally this is not a problem that is on the way to being solved. The mafia is very deeply rooted in society through its infiltration of the economy and political institutions.”

While thousands of medium and small companies, the heart of the economy, go under in the recession, the mafia’s big problem, investigators say, is laundering a sea of cash generated by drugs, extortion, gambling and illegal disposal of toxic waste.

In a credit crunch the mob makes even more money, lending at extortionate rates to desperate small companies which cannot get finance any other way and then taking them over when the owners are unable to keep up the payments.

“The crisis to us means lack of liquidity, which the Camorra and other criminal organizations have in plenty. So it is a great ally for them,” said Paolo Romani, director of Avviso Pubblico, a group of anti-mafia local governments.


Libera is trying to reclaim the school in Scampia, an area of 80,000 residents said to be Europe’s biggest drug market, as a refuge for teenagers that will eventually host a theatre, cinema and restaurant where chefs and waiters will train.

When it took possession a few months ago, the extensive two-storey building was like a vision from hell, says local Libera leader Ciro Corona, 32. The clean-up will take at least a year.

“There was a 5 cm (2 inch) carpet of needles on the ground, vomit, excrement, blood everywhere. There was a terrible stench, there were buckets of needles where children played,” he says.

Addicts tore out aluminum windows and destroyed walls, ceilings and bathrooms to get at copper cables and water pipes to sell for drugs. They used classrooms as open toilets.

On the walls are reminders of a happier time before pupils stopped enrolling because of drug dealing. Photos show sports days and social events. A sign reads “End of Year Party”.

A few kms (miles) away, Corona’s group trains Scampia youths and young offenders as agricultural workers in a 15 hectare (34 acre) peach orchard and wine estate confiscated from a Camorra clan with links to Sicily’s Cosa Nostra.

“They used to dissolve bodies in acid here and plan killings,” he says.

Investigators believe the confiscation program, which has seized 6,500 mafia assets since a law allowing it was passed in 1996, has a powerful impact on organized crime.

“Taking away the assets that allowed the exhibition of prestige and maintenance of power is fundamental to defeating the mafia,” says Geppino Fiorenza, a leader of Libera in the Campania region heartland of the Camorra. “It shows that they are not invincible.”

But even the most optimistic mafia fighters harbor few illusions that this is enough on its own to defeat the mob.

Franco Roberti, Italy’s new national anti-mafia prosecutor, has said the country does not have the political will, or adequate police and judicial resources to fight the mob.

The euro zone debt crisis has pushed issues like crime into a back seat as governments fight to turn around the bloc’s third biggest economy and cut one of the world’s highest public debts.

Current premier Enrico Letta’s fractious left-right coalition struggles to do even that, let alone tackle a criminal network which the Bank of Italy says has an annual turnover worth 11 percent of GDP or around 170 billion euros.

Last year, 25 local councils in southern Italy were disbanded because of mafia infiltration, the highest number since 1993, as the mob used its wealth and muscle to corrupt politicians.

“The mafia is now more dangerous because it has been absorbed into the economic and political system,” Romani said.

Of Italy’s three main mafias, including Sicily’s Cosa Nostra and Calabria’s ‘Ndrangheta, the Camorra has been particularly skilful at transforming itself into a giant business with many links to legitimate activity.

“It would be mistaken to think of today’s mafiosi as simply people who intimidate,” says Romani.

“The Camorristi of today are the sons and nephews of bosses who are frequently highly educated and have the job of handling and investing the great capital made with drug trafficking.”

“They are like armed entrepreneurs,” says Egilio Giordano, 29, a Libera colleague of Corona. “Often the gunman is the one dying of hunger but he is the tip of an iceberg.”

The Camorra is particularly prone to clan warfare because it lacks the hierarchical structure of its Calabrian and Sicilian cousins. Scampia was the center of a feud which killed at least 70 people in the four years up to 2008. Another territorial war started a year ago.

“I don’t have any of my childhood friends any more. Eighty percent are in jail, or dead or ran away,” says Corona.


The area, dominated by bleak apartment blocks known as the “sails” because of their triangular shape, underlines the size of the task in fighting the Camorra.

With youth unemployment as high as 75 percent in Scampia, luring teenagers away from the Camorra is an uphill battle for Corona and his group.

“They can earn 150-200 euros for quarter of an hour’s work as a lookout for drug dealers,” he said.

Scampia is one of the biggest victims of a century of neglect in southern Italy, which saw a 47 percent decline in industrial investment between 2008 and 2012 alone.

Creating jobs is seen as the only way to break the stranglehold of rich mafia clans who dominate many areas as the prime provider not just of work, albeit illegal, but also health care and other social services.

“Nobody wants to be in the Camorra. The state is absent so somebody else is present. If those kids and other people didn’t break the law they wouldn’t eat,” says single mother Monica Cecchi, 43, an out-of-work cleaner.

Scampia’s “sail” apartment blocks, built without any infrastructure or shops nearby, are an example of how flawed public housing projects can foment crime. Some of the blocks have now been demolished and others are largely uninhabited, replaced by brighter, more attractive apartments.

But the area remains scarred by crime and the sign outside its graffiti-daubed railway station seems almost ironic. “If you believe in Scampia, you will find a sea of love,” it reads.

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (, the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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