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ORGANISED CRIME

Extortionists refine tactics

Vladimír owns a business in western Slovakia employing over 250 people. Two years ago, he says, he was approached by several young, pleasant men whom he knew vaguely, and was offered a 'deal' - to pay them a sum of money for a service he didn't need.
Vladimír (not his real name) says the men came equipped with detailed information about his firm - information so complete that he believes it must have come from the tax office. The men said that in return for a sum of money - calculated carefully according to what they knew the firm could afford - they would issue Vladimír a false invoice for work done. Vladimír could write off the invoice as an expense, thus paying lower taxes, and the men would disappear with their fee.
"Extortion has become a very sophisticated criminal practice," said Vladimír, who would not give either his real name and address or that of his firm for fear of retribution.


Suspected extortionist Roman Deák was shot dead getting into his car on October 21.
photo:TASR

Vladimír owns a business in western Slovakia employing over 250 people. Two years ago, he says, he was approached by several young, pleasant men whom he knew vaguely, and was offered a 'deal' - to pay them a sum of money for a service he didn't need.

Vladimír (not his real name) says the men came equipped with detailed information about his firm - information so complete that he believes it must have come from the tax office. The men said that in return for a sum of money - calculated carefully according to what they knew the firm could afford - they would issue Vladimír a false invoice for work done. Vladimír could write off the invoice as an expense, thus paying lower taxes, and the men would disappear with their fee.

"Extortion has become a very sophisticated criminal practice," said Vladimír, who would not give either his real name and address or that of his firm for fear of retribution.

"At first you don't even know whether these talkative and friendly people are criminals or just potential business partners. They just visit you and offer some kind of co-operation, in which you pay lower taxes and they take a commission. They usually have detailed information on your financial situation from the Tax Office. If you refuse their offer, then they just softly warn you that something bad might happen to you or your family."

Jaroslav Sahúl, spokesman of the Police Presidium (the highest police organ in the land), said that 'výpalníctvo,' as extortion is informally known in Slovakia, has risen sharply over the last several years. Although he could give no statistics, since extortion is still registered under the more general crime of 'blackmail' in police files, Sahúl said that "in 1998, we were still talking about tens of people taken into custody on suspicion of extortion. This year, we've recorded almost 700 so far."

Waking up to crime

Ten years after the Velvet Revolution, Slovak citizens cite the steady increase in crime during the 1990's as one of their greatest concerns.

According to the 1998-1999 Annual Report of the Institute for Public Affairs (IVO), a Bratislava think tank, Slovaks ranked crime third on a list of concerns that citizens faced in 1998. In 1990, crime ranked eighth.

One explanation for the increased concern is that crime is causing far more damage than ever before in Slovakia. In 1990, according to police statistics, losses sustained from criminality amounted to about 500 million Slovak crowns ($12 million); eight years later, this figure stood at 7 billion crowns.

The increasing failure of the police to solve crimes may also have been behind the sudden increase in social awareness. In 1989, Slovak police registered 46,298 criminal acts and solved 87.8% of cases. In 1998, however, 93,859 crimes were committed, but only 48.6% were solved.

Peter Nevolný, an Interior Ministry spokesman, confirmed that the increase in overall crime was largely related to an explosion in economic crimes, such as fraud, extortion and money laundering, as well as organised criminal activities, such as drug trafficking and smuggling - sophisticated crimes that the police had little experience of prior to 1989. "Organised crime did not even appear in police statistics until 1993," Nevolný said.

With little experience of fighting well-organised criminal gangs, the police have been further hampered by budget limitations. One policeman from the southern Slovak city of Galanta said that patrol officers were requested not to drive more than 50 kilometers in a 12-hour shift, to save on gasoline.

A senior police investigator from the police branch that combats organised crime said that budget cutbacks had also limited the effectiveness of his unit. "One of the most important consequences of our economic situation is that we cannot pay informants, which is the key to cracking mafia groups," he said. "We also cannot afford some of the tools we need, such as thermovision equipment - forces in Austria or Germany, for example, are much better equipped."

As the ability of police to combat crime has fallen, the confidence of the public in law enforcement has also tumbled. According to the 1998-99 IVO report, 55% of Slovaks now distrust the police.

This distrust ranges from a feeling that the police are merely incompetent, to a belief that they are actually co-operating with criminals. One young man in a southern Slovak city told The Slovak Spectator that his car had been stolen, and then ransomed back from the thieves for 30,000 crowns ($7,500). The police had been informed of the transaction, he said, but had done nothing to prevent it.

The Police Presidium's Sahúl agreed that "police corruption is a serious problem, we're aware of that." Whenever corruption was suspected, he said, an Interior Ministry inspection team was sent out to deal with the situation.

Failure to report

For Nevolný, low public confidence in the police had its roots in the communist era, when the police were a tool of repression in the hands of the state. "After the 1989 revolution, people looked at the police as an extension of the communist system. They lost all respect and faith in the police," he said.

Sahúl, on the other hand, said that the public had been more active even in the last year in reporting less violent forms of organised crime, such as extortion, and helping to track down the culprits. "Compared to even two years ago, the public is much more active in helping the police," he said. "Thanks to them, we are achieving our goals."

But for Vladimír, sophisticated extortionists can almost always manage to avoid detection, while their victims almost never go to the police. The practice of extortion has changed, he said, since the days when a few muscle-bound men would walk into a firm with baseball bats and demand to be paid off. Nowadays, criminals use the poor economic situations of many firms to force them into tax fraud - allowing the firms to survive and the criminals to profit, with the police none the wiser.

"I would never associate with these people personally, but I must if I want to keep my company running," he said. "Taxes in this country are too high, so I have to find a way to reduce my tax burden illegally. For this I need a partner, whose co-operation must be paid for. And this is the beginning point, because once the mafia knows that you are cheating the tax office, you can be easily extorted. If I didn't have to pay 40% tax but rather 15%, I wouldn't have to cheat, and the state budget would receive a higher tax income than it does now. [Finance Minister Brigita] Schmögnerová should realise that."

Vladimír said that he had not reported the extortion incident to the police - and neither had he paid the men what they asked. "But not everybody is so strong," he said, explaining that most business people pay up when threatened. "I didn't tell the police, because the mafia would learn I had spoken and the next day I would be visited again. It's the same also with judges. Corruption is everywhere."

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