CRIME GROUPS CAN THRIVE IN HARD TIMES, POLICE SAY

As People Find Times Harder, They Are Willing To Do More Illegal
Things To Make A Buck, SFU Professor Says

Some Canadians facing economic hard times could be more willing to
risk involvement in criminal activity out of financial desperation,
experts in organized crime say.

Criminal groups in B.C. and across Canada can use that desperation to
weather the current recession better than legitimate businesses,
police specialists and an academic told The Vancouver Sun.

But the growing number of criminal organizations can also be hurt by a
stalled economy, Simon Fraser University Professor Stephen Easton said.

"I think that organized crime on one hand is like all of us -- the
scale of economic activity affects its behaviour and when that scale
is reduced because you are in recession, the scale goes down a bit,"
Easton said.

"On the other hand, there is a bit of substitution, as people find
times harder, they are willing to do more illegal things to make a
buck."

Already, B.C. gangs are raking in more money from cross-border
marijuana smuggling because of the drop in the value of the Canadian
dollar.

But some of those increased profits are being eaten up by a jump in
cocaine prices fueled by the violent war between Mexican drug cartels,
RCMP Supt. Brian Cantera said.

"There have been some notable changes in drug prices, but it has not
necessarily been a result of the Canadian economic situation. It has
been more to do with the Mexican situation," he said.

"What we have seen is a substantial increase in the price of cocaine
locally. It is just like any more item that goes to market really. You
pay more for milk if the producer or the middle man is charging an
extra fee, a transportation fee or whatever."

Cantera, who heads the RCMP's regional drug enforcement section, would
not say what the going rate is to buy a kilo of cocaine for
importation into Canada. But the U.S. Drug Enforcement Administration
pegs cocaine prices south of the border as ranging from $12,000 to
$35,000 per kilo.

He said as the recession deepens, the profits of the drug world could
lure more people into criminal schemes.

"We are going to likely see an increase in enterprise crimes within
the region for all the obvious reasons -- if you can't make money
legitimately, you are potentially going to reach out to making money
through some type of enterprise crime," said Cantera.

"It seems to me to be the way it might occur by virtue of, in some
people's case, survival."

Organized crime is already benefiting from cheaper gasoline, said RCMP
Insp. Mike Ryan, who heads the Integrated Proceeds of Crime unit.

More truckers may be prepared to move drugs north and south even if
there is a deviation to their normal routes because of the lower price
at the pump, Ryan said.

"The reduced fuel costs create more flexibility in the transportation
system for organized crime to take advantage of," he said.

The general public -- with no intention of getting in bed with
criminal gangs -- could fall prey to "scammers and conners" linked to
organized crime who are offering better rates of return on investments
during the recession, Ryan said.

Already crime groups are heavily into producing knock-offs of designer
goods or electronics.

If more people are strapped financially, they could be more enticed
into purchasing counterfeit goods, he said.

But crime groups -- like legitimate businesses -- also feel the pain
of the credit crunch and struggle like other businesses to get their
hands on capital.

Criminals have sources of cash in the community and often make a
series of short-term loans to put together a drug deal, Ryan said.

"If the organized crime group does not have the bag of cash to draw
upon, then they have this network of individuals that they can turn to
and say, 'Hey can I borrow $40,000 from you and I will pay you back in
three weeks and I'll pay you back $45,000.'

"Meanwhile, that $40,000 loan is just part of a series of loans that
go to form a large shipment of money southbound that results in the
purchase of cocaine and shipment northbound."

Easton, who authored a 2004 study estimating the marijuana industry to
be worth billions a year in B.C., said the ups and downs of the
criminal economy have many parallels to the legitimate business world.

Said Easton:

"Illegal industry is just another industry after all at that level."