Author(s)

Guillermo Vazquez del Mercado Almada

Posted on 15 Apr 2020

How is COVID-19 impacting the extortion economy of the Northern Triangle countries? A local network of experts assess how gangs in the region are adapting to the conditions imposed to contain the spread of the disease.

The impact of COVID-19 is rapidly reaching every corner of the world, and in its path it is reshaping licit and underworld economies alike. Corporations, security and healthcare organizations, as well as communities around the world, are adapting to newly imposed restrictions on mobility, and isolation and quarantine set in place to control the spread of the pandemic.

As our first #CovidCrimeWatch newsletter highlighted, criminal enterprises are experiencing constraints and, at the same time, opportunities as a result of the pandemic. One GI-TOC initiative, the Network of Experts against Extortion – developed by the Coalitions for Resilience Project in Central America – held a virtual meeting on 1 April to assess the impact the pandemic is having on extortion networks in the region. Security officials from Guatemala’s National Police Service, El Salvador’s  Justice and Security Ministry and the Honduran Fuerza Nacional Anti Maras y Pandillas (FNAMP, an anti-gang unit) discussed how they see extortion schemes being affected by the quarantine regime set in place in the region since March, and how they envisage extortion practices unfolding in the context of these restrictions.

Gangs – known locally as maras – from Guatemala, El Salvador and Honduras (the Northern Triangle) have seen their capacity to extort restricted by the measures imposed to contain the disease. All across the region, revenue generated by licit commerce has plummeted, with many businesses compelled to cease operating. As a result of their reduced liquidity, many now have insufficient cash to pay the maras their extortion fees (often referred to locally as ‘rents’). As our report A criminal Culture: Extortion in Central America found, extortion is the lifeblood of the maras – the money allows them to pay their members, and support those in prison and their families. Now, with the pandemic hitting business hard, Gangs have had to issue a payment truce to some markets in Guatemala and El Salvador.

According to security authorities, data comparing March 2020 with March 2019, shows a 9 per cent decrease in the number of extortion incidents reported by the police in Guatemala. In El Salvador and Honduras, the figures show a 16.6 per cent and an 80 per cent decrease, respectively. In Guatemala, the difference can be attributed to the law, which allows citizens to report cases to the police in person, by phone or anonymously – as well as to the anti-extortion stance adopted by President Alejandro Giammattei since he took office in January 2020.

When one compares El Salvador with Honduras, mobility restrictions have led to different outcomes. Initial evidence shows that Salvadoran gangs have raised their ‘rents’ to businesses that are still permitted to operate by law, such as food delivery or drinking water supply services, to compensate for their losses in other industries. At the same time, the gangs are enforcing the curfew imposed by the government. WhatsApp audios have been circulated by gangs warning citizens to refrain from leaving their homes, while news reports claim that members of gangs have beaten up people not complying with the curfew.

In Honduras, according to information provided by FNAMP, gangs appear to have gone into hiding. Police have reported that gang leaders have warned their members to take safety precautions and avoid exposure to the virus. The few that have attempted to continue extorting businesses have been apprehended by the police or military, who have deployed a prominent presence on the streets to enforce the mobility restrictions. Despite the heightened risk of being arrested, gangs have threatened public-transport businesses that extortion payments will need to be made retrospectively once the quarantine period is over.

As mentioned, extortion is a key source of income for Central American gangs; the extortion rents support gang members and their families, as well as those in prison who need to pay legal fees, and who continue, behind bars, to direct extortion schemes carried out by gang members outside. It is expected that these organizations will adapt and find alternative sources of income. In Guatemala, for example, the police expect gangs to turn to drug sales and theft during the pandemic. Recently, gang members have been arrested in possession of drugs to sell in the retail markets.

In El Salvador, the Ministry of Justice and Security expects that the financial impact of COVID-19 on gangs will be less severe, as they have continued extorting businesses that are permitted to trade during the restrictions. They have also adapted their business model, and now use Uber vehicles operating under their payroll to collect extortion payments and deliver drugs, as this private transport service is deemed essential and is therefore permitted to operate during the lockdown. Salvadoran police are keeping a close eye on developments here, as they fear the Uber business may become a new way of laundering money, as well as allowing gang members to travel between their territories both during the quarantine and once it has been relaxed.

In Honduras, the FNAMP expect the gangs will turn to robbery, drug retail sales and looting to supplement their revenue and challenge the governmental control of their territories.

Extortion is a pervasive crime, and one that has a corrosive impact on the lives of citizens and the economy in many ways. Paradoxically, COVID-19 pandemic seems to be opening a small window of opportunity to analyze the phenomenon and prepare for what may come after this public-health crisis has passed. As with any other economic market, gang extortion activities in Central America will be affected, and actors will be compelled to adapt or charge additional fees to recuperate losses after the emergency is over. It is therefore important to keep a close watch on the following trends:

  • According to security officials from FNAMP, there are initial indicators in Honduras that even before the quarantine, the role played by women in the extortion economy has been changing from that of messengers or collectors of payments, to administrators or heads of criminal groups, and even assassins (‘hit women’). Honduran security authorities expect during the quarantine this may well continue as gangs take advantage of women’s lower profile, but it will be important to see if this changes once the quarantine has been lifted.
  • The police in Guatemala have suggested that during mobility restrictions, vehicles such as those used by private taxi on demand apps should be subjected to scrutiny, as they could well be used by gangs to collect payments or transport illicit goods.
  • Intelligence should be developed to help take pre-emptive action against maras before the COVID-19 is over and they start threatening society again. The mobility restrictions imposed in the Northern Triangle countries could work in favour of security officials, as gang members currently will find it more difficult to evade law enforcement.
  • Regional channels of communication among security institutions of the Northern Triangle countries should be encouraged to share intelligence on how changing extortion mechanisms detected in one country might be replicated in another.

Many questions still arise. For example, how are copycats or imitators likely to adapt to this context, providing more opportunities for extortion? How long will payment truces offered by the gangs be sustained? Will in-kind payments be accepted if conditions worsen? Will security institutions be able to contain the extortion economy once the quarantine is over? The context is changing rapidly during the pandemic, and the Network of Experts Against Extortion will continue observing, analyzing and exchanging information to provide possible answers to these concerning issues.