CHAPTER 1 CRIMINALLY EXPLOITABLE Ties: A NETWORK APPROACH TO ORGANIZED CRIME Klaus von Lampe Introduction ‘After decades of haggling over the question of “myth and reality” the sci- entific and political debate on organized crime in North America and Europe seems to have reached an implicit consensus. There is no one left today who dares to doubt the existence of organized crime. At the same time few if any, will object to the observation that in the absence of a generally accepted def- . there remains a great deal of uncertainty about what organized crime This paradoxical situation may be unsatisfactory, but for the moment it seems inevitable. Although the term organized crime is used as if it denotes & clear and coherent phenomenon, itis in fact an ever-changing, contradictory. ‘and diffuse construct. A myriad of aspects of the social universe are lumped together in varying combinations within different frames of reference de- pending on the respective point of view of each observer! Faced with this dilemma and the apparent futility of attempts to arrive at a universal definition of organized crime, a number of authors have tried to achieve greater clarity by reducing the subject to narrower and more precise concepts. The most notable approach in this regard has been the concept of illegal enterprise. The enterprise theory takes activities, not structure, as a start- ing point to investigate how illegal entrepreneurial activites are organized {Smith 1978; 1994). Although it avoids the fixation of the so-called conspir- acy theory on ethnically defined criminal organizations (see Cressey, 1969), this approach is likewise in danger of missing some significant aspects that are ‘addressed in the debate on organized crime, including criminal groups en- ’10 « Organized Crime: Perspectives and Approaches gaged in predatory and fraudulent crimes with no primary market orienta- tion, and quasi-governmental or parasitic power syndicates (Block 1983) that ‘occupy strata above criminal groups engaged in illegal business transactions, At any rate, the incorporation of noneconomic manifestations of collective criminal behavior into the enterprise model, eg. under the label ofa “service technology of security and enforcement” (Smith 1978,174), appears a bit far- fetched. ‘As an alternative path to a better understanding of the phenomena com- monly subsumed to organized crime, I would like to propose the concept of ‘criminally exploitable ties. This approach takes the relations between crit nal actors asa fixed point of reference. Regardless of whether the debate cen- ters on certain types of crime such as drug trafficking or investment fraud, on certain collectivities, such as “mafia syndicates” or criminogenic milieux, or (on systemic conditions, such as corruptive alliances of businessmen, poli cians, and public officals, in every instance the participants are connected through criminally exploitable ties, which in turn combine to form criminal networks ‘The network approach to the analysis of organized crime is certainly not a ew idea. Apart from being used by law enforcement agencies as an inves- tive tool (see Davis 1981), it has been applied in numerous studies, though arly to overcome the shortcomings of traditional organization theory ‘with regard to the fluid character of criminal microstructures (see Finckenauer ‘& Waring 1998; lanni 1974; Johansen 1998; Lupsha 1983; Weschke 1986). The Purpose of this chapter isto discuss the relevance of the network perspective within a broader frame of reference encompassing three levels of complexity: the level of individual crime networks and criminal organizations, the level of illegal monopolies, and the level of intertwining illegal and legal structures. On each of these levels I attempt to briefly review the pertinent literature and to speculate with more or less empirical and theoretical backing on how crim- inal structures are determined by the underlying dyadic relations between criminal actors. Criminally Exploitable Ties The basic unit of any form of criminal cooperation is a criminally ex- ploitable tie linking two actors. Using the term criminally exploitable instead of just criminal emphasizes that in the debate on organized crime the focus is not exclusively on manifest structures, but also on latent ones, that is, rela- tions, which are activated only sporadically when certain opportunities or (Criminally Explotable Ties «11 needs arise. In order to be criminally exploitable, a link connecting a pair of actors will tend to show two main characteristics: corresponding criminal dis- positions and a common basis of trust. It seems plausible that one actor engaged in criminal activities can make use of knowing another actor only to the extent that they share similar crim- inal dispositions, such as the willingness to participate in the same type of ‘criminal behavior, for example, robbing a bank, smuggling contraband ciga- rettes, initiating an investment fraud scheme, or exchanging child pornogra~ phy. The question where these dispositions originate is a matter of general criminological investigation and not one specific to the debate on organized crime, Suffice to say at this point that people have to have similar criminal in- terests and preferences. This may not be the case when, for instance, a drug trafficker and a distributor of child pornography meet. Each might vigorously ‘object to the other's line of business. ‘Once two actors with corresponding dispositions have met, itis unlikely that they will cooperate simply based on the mutual interest in the successful completion of some endeavor. Instead, cooperation will depend on a common basis of trust. This assumption rests not only on the general notion that so- cial interaction tends to be embedded in social relations (Granovetter 1992). In addition, trust is needed to minimize the specific risks inherent in illegal interaction. These risks are manifold. Firs of all, cooperation increases the risk of detection and prosecution by law enforcement agencies; for example, 4 partner in crime may turn out to be a police informant. Second, untrust- ‘worthy partners may voluntarily or negligently reveal business secrets not pro- tected by patents to other criminals, or, by disclosing information, they may attract predatory criminals. Finally, trust needs to be placed in a partner in crime with regard to the agreements, which define the respective illegal inter- action. If such a “contract” were broken, it could not be enforced in a court of law. ‘A common basis of trust can be found in some sort of bonding relation- ship, such as kinship, childhood friendship and prison acquaintanceship (see anni 1974; Lupsha 1983). Similar bonds may be formed within such insttu- tions as the military and intelligence services" These links have in common that, apart from the aspect of affection, there isa high degree of predictabil- ity asa result the long-term testing of personal characteristics. Such a bond does not necessarily have to connect two actors directly. Two actors may be connected through an intermediary who maintains a bonding relationship with each actor individually (see Abadinsky 1981, 83). ‘A.common basis of trust may also be found in the generalized expectations of an actor's conduct because of a particular affiliation, Membership in a se-12 + Organized Crime: Perspectives and Approaches cret society, such asthe Sicilian Mafia or the Chinese Triads, will have such an ceffect as long asthe selection of new members and the enforcement of inter- nal rules ensures the reliability and trustworthiness of each individual mem- ber (see Gambetta 1993; Chin 1990). Basically the same mechanism of medi- ating trust, but in a less manifest form, is probably also at work among members of a particular criminal milieu, like the traditional underworld (Melntosh 1971) or a drug subculture (Adler 1985). Those who belong to such «a subculture share a specific set of deviant values and adhere to a certain code ‘of conduct. When they are recognizable to each other—either by reputation, provided the subculture is sufficiently transparent, or by distinctive charac- teristics such as clothing, language or behavioral patterns—a bond of trust may be formed between them without necessitating an intermediary (see Sutherland, 1937:16-21). ‘The same may be true with regard to ethnic minorities. To the extent that ethnicity implies a certain cultural cohesion with resulting group in loyalty and sentiments of opposition toward the legal and criminal justice system of the host country, it can be considered a relevant trust variable (Finckenauer 1994, 246; Lupsha 1986, 34). However, the importance of ethnicity as a bind- ing force may well be overestimated because in many cases ethnic ties coin- cide with more intense bonds, such as kinship and childhood friendship (Pot- ter 1994, 121). ‘A common basis of trust not only appears to create a foundation for crim- inal cooperation. It can be hypothesized that its strength and quality also de- termines in what way and to what degree a particular relation can be exploited for criminal purposes. The higher the risks of a particular pattern of cooper- ation, the more one would expect to find strong bonding ties connecting the pertinent actors. Support for this proposition can be drawn from research findings indicating that criminal networks tend to be based on strong links, ‘most notably kinship tes, childhood friendship, and prison acquaintanceship, and that, reversibly, where such strong ties are absent, criminal cooperation tends to be rather ephemeral (see, e.g. Finckenauer & Waring 1998; Ianni 1974; Lupsha 1983; Potter 1994; Potter & Gaines 1995; Waring 1993). Both subjective and objective factors may play a role here. Subjectively, a criminal who perceives a particular interaction as risky and the potential partner as un- reliable will tend to refrain from getting involved. Objectively, it can be as- sumed that the relationship between criminal actors who take the risk of col- laborating without an adequate underlying basis of trust is more susceptible to conflict, deceit, and detection and thus less likely to persist. Of course, this is not to argue that a common basis of trust could not de- velop over time. In fact, procedures to gradually establish trust area quite fa- ‘Criminally Exploitable Tis + 33 iliar phenomenon that can be observed, for example, in the recruitment of ‘young criminals into adult crime networks (Ianni 1974, 124) or in the screen- ing of potential business partners in illegal markets (Reuter & Haaga 1989, 45). But in every phase of such a process these considerations about the cor- relation between the degree of risk inherent in an illegal interaction and the strength of the underlying bonds would apply. In the end, high-risk interac- tion may be based on trust that has purposefully been built over some time. However, given the rather short time horizons of criminals and the greater potential for damage resulting from the failure of a continuous criminal co- operation, the exploitation of preexisting bonding ties appears to be the more likely alternative wherever itis available. ‘Another question that needs to be addressed is whether reliance on trust, be it preexisting or gradually developed, could be replaced by some other means, such a¢ material reward or the threat or use of violence. As Peter Reuter has argued, this may be the case but only at a high cost not incurred by “positive non-economic ties” (Reuter 1983, 116). In summarizing the argument about the fundamental relevance of crimi- nally exploitable tes, I would like to suggest that for a particular actor the set of criminally exploitable ties demarcates the social space in which, at a given point in time, criminal cooperation is subjectively and objectively a viable op- tion, and that, asa rule of thumb, an actor's scope of action depends on pre~ existing bonds of trust rather than on either purposefully developed trust, vi- lence, or financial reward. ‘The content of these relations is a different matter. Criminally exploitable ties can serve many different purposes, of which the collusive perpetration of crime, including the exchange of illegal goods and services, is only the most obvious one. Communication also plays a vital role with regard to, for exam- pile, the exchange of criminally useful information and the transmission of de- vant norms and values. This indicates that criminally exploitable ties are not necessarily a one-way street. Although they open up opportunities for an in- dividual actor, they may just as well have a formative influence in that they shape an actor's views, beliefs, and capabilites. Networks and Organizations Dyadic relations are not the only determinants of criminal cooperation. Opportunities and constraints also arise from the characteristics of the over- all network of criminal relations an actor belongs to (Granovetter 1992). A network is commonly defined as a specific type of relation inking a set of