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Observatory of Illicit Economies in South Eastern Europe
Summary highlights
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Cyber-enabled crime poses significant risks to South Eastern Europe.
The lack of preventative measures has left South Eastern Europe at an increased risk of cyber-enabled crime, as evidenced by well-orchestrated attacks against Albania and Montenegro. Low awareness of this form of crime, inadequate investment in basic protection, and high levels of corruption and unemployment all contribute to this vulnerability. If left unaddressed, these structural and legislative weaknesses could have serious consequences for the provision of public services and public security in the region.
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Operation Black Tie exposes the interface between upperworld and underworld in Bosnia and Herzegovina.
In April 2024, an operation codenamed ‘Black Tie’ led to the arrest of 23 people in Bosnia and Herzegovina and the freezing of substantial assets. The operation, made possible by the de-encryption of apps used by criminals, shed light on the activities of major criminal figures from Bosnia and Herzegovina such as the head of the Tito and Dino cartel, Edin Gačanin. As well as demonstrating impressive joint law enforcement cooperation, the operation has unmasked disturbing links between underworld figures and facilitators in the upperworlds of business and politics.
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Montenegrins continue to play a role in cocaine trafficking from Peru to Europe.
For the past two decades, criminal groups from the Western Balkans, particularly those from Montenegro, have been active players in the trafficking of cocaine from Peru to Europe. There is the risk that some of these criminal groups could exploit the expansion of coca cultivation in Peru and the deterioration of security in other parts of Latin America to further their own interests.
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Western Balkan criminal groups maintain a significant presence in Germany.
Data from German criminal justice authorities shows that criminals from the Western Balkans (particularly Albania) are major players in the country’s drug markets, as well as in human trafficking and money laundering. In the past, Balkan nationals have also been members of a notorious motorcycle gang that was banned by German authorities. This article looks at where and how these groups operate and what police have discovered through de-encryption of apps used by criminal groups.
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South Eastern Europe is beset by cash smuggling across its borders.
For criminals, cash is still king. Cash smuggling remains an important means of moving illicit money, for example to repatriate profits from drug deals, while avoiding detection by law enforcement. Recent seizures of cash at border crossings in the region point to the need for a coordinated effort to tackle the problem.
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The legalized medical cannabis business in North Macedonia is at risk of criminal diversion.
In 2016, North Macedonia legalized the cultivation of medical cannabis. Since then, the industry has boomed. But legalization has brought with it a number of challenges that have created opportunities for corruption and organized crime, particularly around the issuing of licences and the diversion of legally grown cannabis to the black market.
About this issue
In this issue we focus on a problem that is increasingly affecting the Western Balkans, namely cybercrime. Our concern is that if the risks highlighted by recent attacks and police operations are not adequately addressed at both the national and regional level, the rapid pace of technological innovation threatens to place malign actors beyond the reach of regional law enforcement. This is an issue that requires closer collaboration between the private and public sectors, as well as greater regional and international cooperation.
There have been several shocking revelations in recent months as police sift through information gleaned from the de-encryption of apps once popular with criminals, such as Sky ECC and EncroChat. In Bosnia and Herzegovina, cooperation between the Bosnian police, Europol, the US Drug Enforcement Administration and the Federal Bureau of Investigation has uncovered the activities of notorious criminal groups such as the Tito and Dino cartel, as well as the state-embedded actors who have facilitated and protected them. In this issue we look more closely into this political bombshell and its impact on Bosnia and Herzegovina.
Since the publication of ‘Transnational tentacles: Global hotspots of Balkan organized crime’ in 2020, we have been monitoring the activities of criminal groups from the Western Balkans abroad. We examine two cases in this issue: criminal groups from the Western Balkans operating in Peru and those operating in Germany. As in other parts of the world, these case studies reveal a high degree of inter-ethnic cooperation among groups from the Western Balkans, close collaboration with domestic criminal groups, and an ability to adapt and innovate.
While much attention has been paid to the impact of digital currencies on organized crime, it is crucial to note that for many criminals cash is still king. Major seizures at key border points in South Eastern Europe suggest that cash smuggling is on the rise. In this issue we look at the problem and the efforts being made to tackle it, particularly by the EU and the UK.
The evolving legal landscape around cannabis is another issue of interest in the region. Several countries in South Eastern Europe are experimenting with the decriminalization of cannabis or the legalization of medical cannabis. In 2016, North Macedonia became the first country in the Western Balkans to legalize cannabis for medical use and now has several years of experience. The policy has brought financial benefits but has also created several challenges, such as allegations of corruption in the licensing of private companies to grow cannabis and the diversion of legally grown cannabis to the black market. This is a challenge that North Macedonia’s new government will need to face, and there may be lessons for other countries in the region and beyond following this path.
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