An analysis of organised crime groups as participants in the licit economy

Abstract

Economic prosperity provides opportunities for expansion and collaboration between illicit and illicit market participants. Thriving market conditions offer prospects for organised crime groups to pursue relationships with (or infiltrate) licit markets, thereby disguising and entrenching themselves in the legal economy. The possibility of crime infecting the legal economy is increased in countries such as South Africa, due to ineffective or deficient legal frameworks aimed at combatting and prosecuting organised crime. This study, therefore, aim to examine how the infiltration of evolving licit markets can be restricted through a critical analysis of the infiltration of identified licit markets by organised crime groups to enable substantiated outcomes rendered from these researched markets to guide and inform regulatory reform efforts. This study is divided into three articles, each contributing towards the overarching objective of safeguarding licit markets from infiltration by organised crime groups. The first article examines infiltration behaviour by questioning the underlying drivers and methods. An investigation is done of methods and drivers for infiltration of the licit market by organised crime groups. This qualitative study critically analyses different methods of classification in order to identify and describe structural or organisational forms of OCGs. The remaining articles examine markets with notorious links to criminality, thus labelled as grey markets where the licit and illicit are interwoven. The South African tobacco trade, specifically the related illicit cigarette trade is investigated in article 2. An examination of the current scale and nature of the ICT is made together with an evaluation of attempts to combat ICT in South Africa. This qualitative study is performed in the form of a critical analysis. Various approaches were utilised to explore possible explanations for the success of the South African ICT. These include inter alia social, economic, psychological and political factors, as well as law enforcement capability. These approaches are considered, alongside international best practice in order to develop fit-for-purpose recommendations that address identified weaknesses in the current regulatory approach. Similarly, the South African illicit wildlife trade, in particular the illicit abalone and cycad markets, is studied in article 3. The threat of criminal coordination in illicit South African wildlife markets are investigated and a proposal for an indicator-based model which

contributes towards the detection of a possible escalation in respect to this threat, is forwarded. Regulatory initiatives need to account for infiltration behaviour and its intricacies if it wants to provide effective protection against criminal infestations. A one-size-fits-all approach to organised crime deterrence is predestined to fail as it neglects to account for the idiosyncrasies in licit markets, particularly the more vulnerable grey markets. Consequently, this study emphasises that a grey market's context needs to be understood, therefore acknowledgment of the diverse nature of these markets is required. Individual analysis of markets enables tailored interventions that can be implemented. Thereby, the virus of criminality can be halted or cut-off from further infiltrating the broader (licit) society.