Sea Transportation: Targeting The Middlemen

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October 14, 2011: Britain has organized a special intelligence team to track down those who are financing Somali pirate gangs. This all began when British intelligence in the Persian Gulf (where all sorts of other skullduggery has to be monitored) picked up details of the lucrative practice of financing Somali pirate gangs, in return for a large cut of any profits. Typically, the financiers provide the money to buy weapons, boats and equipment (especially satellite phones and GPS receivers) and small salaries for the pirates. The financiers then handle the ransom negotiations and cash delivery, if their gang captures a ship. Successful gangs will return their sponsor a profit equal to 10-20 times the original investment. The usual investment is $20,000 or more. More than half these investments appear to pay off, although that percentage is declining as more financiers enter the business, and fewer ships are taken.

While the gang leaders could, in theory, finance their own piracy operations (and some do), they still need the help of men with access to the needed equipment, and possessing the skills and contacts required to negotiate a ransom. Thus these financiers are essential to most of the pirate activity. Identifying these men could lead to their arrest. That would discourage others from such activity and reduce the amount of pirate activity.

These financing operations are usually for a certain period (six months or a year), and the financiers get their cut of the ransom before the rest is delivered (usually by air) to the pirate gangs. The gang leaders get a big cut, and the men who actually took the ship get more cash than they would normally earn for their entire lives.

 

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