Go West, Young Comrade
The Russian Mob in America
By John William Tuohy
Move over Mafia, there's a new kid on the block and he's hungry. The Russian Mob, the largest of the new ethnic outfits, has been growing larger and more powerful over the past twenty-five years. However, its most significant growth has occurred during the past five years, because Russian society continues to fall apart, unleashing thousands of desperate mobsters on our shores, ruthless mobsters who view the American criminal rackets as nothing less then a smorgasbord of wealth, power and privilege.
According to the FBI, there are over 200 Russian mobs operating in American, in at least 17 cities in 14 states. At least four of those groups operate in California alone, with interests in Los Angeles, San Francisco, San Jose, Sacramento, and San Diego. These groups have linked with Russian organizations in New York, Boston, Chicago, Miami, Cleveland, Philadelphia, Seattle, Washington, Illinois, Pennsylvania, Massachusetts, Maryland, New Jersey, Ohio, and Oregon to form an enormous criminal syndicate.
Only a decade ago, these groups were only loosely structured criminal networks, but today they are highly sophisticated organizations. However, the Russian mobs in the US remain relatively small in size, with each gang numbers less then several hundred members.
By comparison, our Russian mob problem is minuscule compared to what the new Russian republic is facing. At the close of the last century, the official estimates out of Moscow were that there were over 5,000 organized crime groups operating in Russia, with an estimated 100,000 members. Although, the government is quick to point out, and US authorities agree, that only about 300 of those gangs have some sort identifiable structure.
However, some Russian mob experts argue that the government is wrong, that the Russian-based mobs, are, in fact, very organized, and only appear to have no structure, a tool they use to minimize contact within the organization for security purposes and to throw investigators off their trail.
Lose or not, the structure of these organizations on both sides of the Atlantic remains basically the same. Each group is led by a boss, called a "pa khan," who controls four criminal groups, or cells within the organization, although, like the American Mafia, the Pakhan has only minimal contact with the men under him. Instead, he uses an intermediary called a "brigadier."
In turn, the brigadier is watched over by two spies to ensure loyalty and to make sure he doesn't get too much power within the organization.
On a street level, the membership is specializing in various types of crimes, such as drugs sales, prostitution, political contacts, and muscle men. Normally, the street soldier has no idea who is true boss is, since they are never told, and the leadership is protected by layers of buffers.
However, there is still, after two decades, considerable debate in the law enforcement community regarding the level of organization and structure of Russian mobs in the US, which is confused by the fact that some Russian immigrants are involved in crime, but are not members of any mob.
Another factor that makes the Russian mobs appears loosely organized is that many of the groups that branded as "Russians" are most often not Russian at all, at least not in the traditional American view. Instead, these gangster are a wide mix of other ethnic or regional backgrounds, who have formed networks of shifting alliances that meet particular needs at a particular moment.
But, the fact remains, they cooperate. It's a fact that Russian mobsters on the East Coast cooperate and communicate with the West Coast outfits, and that both groups stay in contact with organized crime groups in Russia. According to the US State Department, members of the European based Russian mobs are often sent to reinforce and consolidate links between groups in Russia and the United States and to perform executions.
The CIA recently revealed that the Russian, Asia, and Africa mobs are forming alliances with traditional Italian and Latin American mobs. As an example, the African mobs are said to be working with the Russian in Sri Lanka running prostitution and gambling rings.
In South America, Colombian cocaine distributors and the Sicilian Mafia, are believed to have formed an alliance with the Russians, to import large quantities of cocaine into Europe and the United States. The head of the Colombian national police says one of the biggest problems facing Latin America's anti-drugs squads is the Russian Mafia which is trying to expand into narcotics trafficking in Colombia and Brazil. Allegedly, one Russian gang tried to sell the Colombians a Soviet-era submarine which would have enabled them to smuggle drugs into the United States easier.
However, it's generally agreed by US law enforcement experts, that the Russians are not extensively involved in narcotics distribution, preferring the less dangerous areas of medical and insurance scams and telecommunications fraud. The later involves stealing electronic serial numbers of customers' cellular phones and programming them into computer chips, thus making a duplicate or clone of the telephones.
Another area where the Russian lead the pack is in banking, or laundering enormous amounts of cash. They do this by opening import/export businesses which are set up for the sole purpose of shipping large amounts of US dollars to and from Russia. An estimated $30 billion in Russian mob crime funds has left that country since the fall of communism, and the FBI believes that most of it was laundered by banks in Switzerland, Liechtenstein and Cyprus after it found its way into the US.
Fraud schemes are popular with the California branch of the Russian mob, especially the "fuel tax frauds" a complex scam which, run under the protection of the American Mafia, has netted both group's hundreds of millions of dollars. Former New York mobster Michael Frances, whose mob family was in the muscle end of the scheme said "It was not unusual for me to receive $9 million in cash per week in paper bags" from the Russians.
The various fuel schemes, which are popular with the New York and the Armenian dominated branches in Los Angeles, works like this; state and federal tax forms are falsified and run through a front company, known as a "burn," which are then reimbursed by the government, to the tune of $2 billion dollars a year. The mobsters are seldom caught because they generate a mountain of paper work which they submit to the government through dozens of front companies. By the time auditors and investigators unravel the series of complex transactions, the fronts have been closed, and the hoods have reopened somewhere else.
Another scheme involves purchasing chains of gas stations, or in some cases fuel supply companies, and cutting, or blending gas with additives like alcohol and then selling it as high grade fuel.
Other areas of growing interest for the Russians include extortion, loan sharking, auto theft, counterfeiting, credit card forgery, precious metal and raw material smuggling.
But what concerns US authorities the most, is the Russian involvement in weapons smuggling. The US Justice Department is so concerned about it, that the Attorney General has named Russian organized crime a priority target, and the FBI has opened a Moscow office that will focus attention on the potentially disastrous threat of mobsters selling nuclear weapons on the third worlds black market.
In that same vain, FBI Director Louis Freeh, said that the Russian Mafia was the greatest threat to US national security, although, he later withdrew the comment. Politically correct or not, Freeh is right, if Russian mobster help foreign powers gain access to nuclear material or weapons, the scenario becomes truly frightening.
Like the Mafia, the Russians are violent, but murder and beatings, is usually restrained and dolled out for specific reasons, such as eliminating the competition, snuffing out informants or as punishment for greedy members.
Also like the Mafia, in the early years, the Russians in the US worked under a sort of "Omerta," called "Vory v Zakone," or Thieves in law, a traditional code of conduct. But the code, which was cumbersome and complicated had a quick death in the face of American opulence and possibilities for individual success.
Unlike the American Mob, the Russian gangsters, generally speaking, have no fear of American law enforcement, the criminal justice system or jail. There is another aspect to the Russian gangsters that sets them apart form the traditional Mafia, their love of tattoos'.
From about 1966 through the early 1980s, the Soviets jailed some 35 million people in prisons. An estimated 30 million inmates were tattooed. The inmates wore the tattoos only after they had committed a crime. The more convictions received, the more tattoos a convict would have. These tattoos give a picture of the inmate's criminal history. A prisoner wearing an unauthorized tattoo could be punished or killed by fellow inmates.
And how did we end up with such desperate characters in our midst? Many State Department experts believe that the former Soviet Secret Police, the KGB, dumped them on us by emptying their prisons of hard-core criminals, and supplying them with Visa's to America after the US Congress enacted the Lautenberg Amendment in 1989, which allowed up to 50,000 Soviet refugees to enter the US each year.
But the Russian mob was active in Brighton Beach, the Russian section of New York, as early as 1975 when a gang from the Odessa region of Russia, was discovered to be involved in fraud. The Odessa Mafia is considered the central Russian organized crime group in the United States and pioneered extortion, theft and prostitution for the Russians. The Odessa Russian gangsters also forged relations with the traditional mobs.
However, tired of paying a tax to the Mafia and looking for its own kingdom, in the early 1980s the Odessa Mafia sent two groups of thugs to San Francisco and Los Angeles to build an organization there, while the leadership remained in Brighton Beach.
And what's the future for the Russian mobs?
As they continue to expand, in all probability their working relationships with other the Mafia and other criminal groups will grow stronger. It is likely that the Russian will look for a bigger piece of the international narcotic's market, considering the profits and the availability of cash the gangsters have. As a result their political influence will increase. But whatever the future holds, the horizons are bright for the new ethnic mobs.
Mr. Tuohy can be reached at MobStudy@aol.com
Copyright © 2000 PLR International