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Report: Go after financiers who profit from piracy

Nov. 2, 2013 at 9:44 AM   |   Comments

NEW YORK, Nov. 2 (UPI) -- African piracy netted more than $400 million in ransom payments over a seven-year period, said a U.N. report calling for a task force to find the financiers.

The report, written by the World Bank and the United Nations, said money raised from piracy is used to fund other criminal activities, the BBC reported Friday.

Between 2005 and 2012, piracy raised between $339 million and $413 million in ransoms, but little of the money actually goes to the pirates who seize ships traveling off the Horn of Africa, said the report, titled "Pirate Trails."

People who provide the money for the ransom operations get 30 to 50 percent of what is paid in ransom, while the "foot soldiers" get a standard fee that amounts to about 0.1 percent of the total ransom.

The financiers invest the ransom money in both legal businesses and illegal activities, moving the money through smuggling, money laundering and wire transfers, the report said.

Stuart Yikona, the report's co-author, said money that flows from piracy "has the power to corrupt the regional and international economy."

The report recommended improvements in cross-border controls, regional cooperation and the monitoring of money gained from piracy.

"The international community has mobilized a naval force to deal with the pirates," Yikona said. "A similarly managed multinational effort is needed to disrupt and halt the flow of illicit money that circulates in the wake of their activities."

Piracy increases the cost of global trade about $18 billion a year, the United Nations said in a statement. It also has caused declines in tourism and fishing in East African countries since 2006.

The report was compiled from interviews with former pirates, government officials, bankers and others involved in fighting piracy. It focused on the countries of Djibouti, Ethiopia, Kenya, Seychelles and Somalia.

© 2013 United Press International, Inc. All Rights Reserved. Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI's prior written consent.
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