55
Organized Crime in Bulgaria: Markets and Trends
141
levels and in all segments of the domestic market the number of those prac-
tic-ing prostitution began to fall. Whereas the late 1990s were marked by full
clubs with 10-12 girls on average (and as many as 40 in the big clubs), in the
past few years, the average number of girls has dropped to 5-6. By police data,
a considerable proportion of the registered street and highway prostitutes are
no longer in the country. According to NGOs engaged in the area of HIV/AIDS
risk reduction among prostitutes, in 2006, a large number of the girls had had
administrative restrictions imposed on their stay in the European Union, known
as ”black stamps”. It is the main reason keeping them in this country.
At the same time, the data point to rising domestic demand for sex services,
particularly in the biggest cities of the country. The reasons are both the increased
purchasing power of the population and the double-figured growth of the num-
ber of foreign tourists since 2001. As a result, there has been a pronounced trend
of increasing prices.
The second factor, acting in the opposite direction and pointed out in the sec-
tion on the export of prostitution, is related to the mass-scale development of
the sex trade. In addition to the above-outlined internal and external channels
for recruiting prostitutes, there has emerged a new process, which in the opinion
of market participants and police officers, has been acquiring epidemiological di-
mensions in the past 3-4 years. It is the boom in amateur and semi-professional
prostitution. Without going into the preconditions,
235
or its actual scope, it is
possible to distinguish two basic patterns of involvement. The first one consists in
accepting offers for paid sex of varying intensity – from 1-2 a month to 2-3 times
a week, which may involve benefits other than cash compensation in the form
of additional consumption,
236
i.e. gifts, payment of bills, etc. The second pattern,
which has been gaining increasing popularity, comes closer to the Asian model
known as the ”second wife”. This model is often practiced with more than one
client (except in the case of a very rich client or low intensity of prostitution).
The number of partners usually ranges between 3 and 5. Various configurations
are possible under this scheme – it may be a relatively closed one comprising
several clients and several, partnering or competing, girls. There also exist open
schemes comprising core customers and girls and peripheral customers and girls.
Under this form of prostitution, too, the compensation may consist in covering
rent or utility bills, cell phones, cars, trips abroad, etc. In between these two,
there exist hybrid forms where in addition to the regular partners the girls see
incidental customers, too.
Under both schemes, access to customers generally takes place outside the exist-
ing channels for professional paid sex services despite the efforts of various sex
entrepreneurs to take advantage of the mass invasion of the sex trade by the new
235 The explanation could probably include a number of preconditions, starting with various socio-
economic factors, through the lifting of certain socio-cultural limitations, to the reduced violence
and control of the domestic market by the procurer networks. Similarly to the phenomenon of
switching from regular work or study to prostitution, observed in the European Union, the boom
of amateur and semi-professional prostitution is completely unexplored in this country.
236 A survey conducted by MBMD on commission from the Bulgarian Center for Gender Studies
reveals that girls generally do not see any difference between payment for sex and gifts by men,
see Duma daily, ”Bulgarians Tolerant to Paid Love”, 11 April, 2006..
Duma daily, ”Bulgarians Tolerant to Paid Love”, 11 April, 2006..
Duma
54
142
Prostitution and Human Trafficking
and Human Trafficking
and Human Traf
type of participants. Typically, the amateurs and semi-professionals find clients
through their own social networks (friends, acquaintances, other customers) and
in places offering easy access to the right social groups, such as bars and clubs,
hairdressing salons, and even specialty stores.
237
Undoubtedly, however, the fast-
est-developing sector for attracting new customers is the internet where competi-
tion with the professional networks has been growing noticeably fiercer.
Amateur and semi-professional prostitution appears to have two distinctive char-
acteristics. The first one is the freedom to choose and respectively, to refuse,
customers. The second one is the absence of regularity in service delivery. The
customer cannot expect to get the same service over an extended period of time.
It is worth noting that most of the women appear to withdraw from the business
temporarily or permanently within 1-2 years. They typically perceive the services
they provide as a temporary occupation. Many of the respondents living in Bul-
garia and abroad said they were going to leave the business once they complete
their education, pay off their apartment, car, loan, etc. Similar exit strategies are
common among the professional prostitutes as well, but judging from the available
empirical information, they are considerably less likely to be put to practice.
Another pronounced characteristic of both professional and semi-professional
prostitution is the blurred boundary between more regular occupations and pros-
titution. Similarly to the Asian model, it is hard to tell at what point the waitress,
sales girl, nurse, or person with some other occupation involving interaction with
customers, crosses the line from normal service delivery to paid sex services.
The third factor, which is likely to radically change Bulgarian prostitution in the
future, is the advancement of new technologies related to the use of internet and
some GSM technologies. As a result of the fast expansion of the access to internet,
since 2003-2005 there have appeared numerous websites for sex services and various
smart solutions for the offer of paid sex through chat forums, search engines, online
video servers, etc. In this context, it would seem that communication technologies
provide a good opportunity to overcome the moral stigma, particularly among the
older generation. Up to now, the sex service supply and demand have been very
difficult to conceal in the Bulgarian environment (possibly with the exception of the
one-million city of Sofia). In a country where family and friendly networks dominate
everyday life, a visit to a brothel can hardly go unnoticed. At the same time, the
discrete schemes of seeking prostitutes or customers are limited by the technical
imperfections of the means of communication (ads in specialized media) or require
the presence of well-paid middlemen. In this respect, the internet offer unlimited
opportunities for the anonymous search and offer of sex services – a fact that greatly
reduces the moral cost of involvement in such activities. The adoption of the new
technologies not only facilitates amateur and semi-professional prostitution,
but also allows the professional prostitutes in the middle segment to sidestep the
middle segment to sidestep the
middle segment
owners of brothels and clubs and directly solicit customers. The response of the
owners was to use the internet with active advertising of their brothels and escort
services. What is more, after 2005 and in 2006 in particular, there was a great deal
of investment in the creation of specialized products such as internet dating sites,
237 In this respect there are some remarkable similarities with Asian practices where even coffee
shops prove efficient places for soliciting clients.
55
Organized Crime in Bulgaria: Markets and Trends
143
online search for ”one-time or regular sex”, having prostitutes owned by brothels
intentionally enter dating chat rooms, forums, etc. These new forms of prostitution
deliberately seek to blur the distinctions between sex with casual partners, online
porn services, and paid sex.
238
However, to the online sex entrepreneurs the chief interest lies in opportunities
outside Bulgaria. It is worth noting that an increasing number of Bulgarian paid
companions in the largest sex markets in Western Europe are offered through
hybrid virtual online services – internet servers combined with a well-coordinated
system using Bulgarian drivers to bring and guard the girls and to collect the
money from the customers. The new technologies make it possible to penetrate
the sex service markets in European countries where prostitution is legal but the
access to windows, legal brothels, clubs, etc., is deliberately highly restricted or
too expensive for Bulgarian sex entrepreneurs. These limitations can be overcome
with the new technologies, moreover without breaking the law of the respective
country. All internet or call orders are processed through servers and telephone
exchanges located in different countries with suitable legislation and the services
delivered are passed off as Internet services. Each investigation of such interna-
tional schemes and attempts by the police to counter the materialization in reality
of this virtual grey market ultimately come up against complex legal cases. Owing
to the as yet limited scope and the invisibility of this market, law-enforcement
and criminal justice authorities in Western Europe tend to avoid this dark zone.
The impact of the new communication technologies and the escalation of pros-
titution into a mass occupation coincide with the new opportunities opening up
before this country with its accession to the European Union. Travel to and from
Bulgaria has been greatly facilitated with the abolition of the internal borders and
in addition, the country signed the open sky agreement, which has resulted in the
rapid expansion of low-cost airlines. As a result, the cost of traveling to Bulgaria
has become comparable to inter-city travel in Western Europe. In view of the
mass construction of tourist facilities in the period 2001-2006, sex tourism can be
expected to start competing with the export of prostitution as a business. Bul-
garia already has a certain tradition in this type of service delivery in Southwest
Bulgaria.
239
According to entrepreneurs in the sex industry, importing customers
238 There exist various models and what is common to them all is the use of popular sites to meet
people and eventually propose paid sex. It is sometimes difficult to tell apart the use of ordinary
social networks where voting by SMS leads to a rise up a ranking and respectively, generates
income for the owners of the website; or where one is dealing with a paid chat with interac-
tive sexual content; or finally, where entering a virtual club means access to real paid sex. At
present, there is reason to claim that the sphere of the virtual/real is an almost unexplored and
non-transparent zone. What are the methods of selecting the persons to whom propositions are
made; to what extent this is a system using traditional statistical methods familiar from advertising
to monitor which pages the consumers are viewing, whom they are talking to, etc; whether the
whole process is still in a chaotic and primitive phase; these and many more questions are still
difficult to answer. Revealingly, there is hardly any major free torrent server without advertise-
ments of paid sex services from Bulgaria.
239 In the mid-1990s, agricultural producers from northern Greece became the first organized sex
tourists in the winter season. As a result, towns of a population of 30,000 such as Sandanski and
Petrich turned into major Greek destinations for sex tourists, where they are served by several
hundred girls. In the past 5-6 years, similar specialization has been taking place in the largest
towns of the country, with companies organizing charter flights with male passengers only; ad-
vertising ‘escort services by female students’ in foreign specialized sites, etc.
43
144
Prostitution and Human Trafficking
and Human Trafficking
and Human Traf
is a better option than exporting girls. The risks are significantly lower owing to
the possibility of influencing the Bulgarian law-enforcement and criminal justice
authorities and the daily expenses (accommodation, food, etc.) are considerably
smaller, as well. In illustration of the competitive economic advantages of the
import of sex tourists comes the fact that Bulgarian prostitutes actually prefer to
offer paid sex close to the Greek border rather than in Greece itself. There is
reason to predict that, if part of the tourist industry should decide to try and
boost hotel occupation rates during the off-season, with the cheap flights, the
Bulgarian seaside, mountain and particularly spa resorts stand to become serious
competitors to the Prague and Budapest hotels specializing in sex tourism.
In view of the above-outlined recent trends in Bulgarian prostitution on the national and international level, and
given the current legal framework, it is possible to formulate the following forecasts in the short and medium
term:
•
Prostitution will continue to be a priority area of activity to organized crime groups in Bulgaria;
•
With the accession to the European Union, the export of Bulgarian prostitutes to member countries will
most probably increase;
•
New channels and destinations for the export of prostitutes are likely to emerge;
•
Organized crime structures will seek specialization in a variety of sex tourism schemes;
•
Mutual penetration and interaction between local and international organized crime structures will be in-
tensifying;
•
Efforts to launder profits from prostitution and to invest them in the legal economy can be expected to
step up;
•
Prostitution is likely to remain associated with other criminal activities;
•
Prostitution practices will continue to be covered up under the guise of legal business activities;
•
Sex exploitation of under-aged girls is not likely to end soon;
•
The problem with Roma prostitution will persist and probably worsen;
•
Unless the current legal framework is amended, police counteraction capacity will remain highly limited.
Box 5. Trends in the prostitution market
37
4. THE VEHICLE THEFT MARKET
4.1. FROM THE ECONOMY OF DEFICIT TO THE BLACK ECONOMY
The market of stolen vehicles in Bulgaria is more than simply a criminal phe-
nomenon. Mapping its development could yield a picture of the history of local
organized crime and provide a specific angle of looking at Bulgaria’s transition
to democracy. A number of formative factors at play long before that period
preceded the emergence of motor vehicle theft as a full-fledged market in the
1990s. Private cars became the property in highest demand (closely following the
possession of a family home) as they started to be regarded by the population as
a marker of higher social status and purchasing power conducive to a different
lifestyle altogether. The communist elites, on the other hand, imposed the view
that cars, as luxury goods which communist society could not afford, spoilt the
population by fostering Western consumerism. In emulation of the Soviets, the
Bulgarian state introduced complex restrictions to control demand, due to which
the average wait time to purchase a car was 6–10 years, while to acquire one
took 10–15 years of saving for an average Bulgarian household.
Due to the shortage of family cars many households turned to the stolen vehicle
market. Criminal records from the pre-1990s indicate that car theft was a rather
frequent offense. At the same time, the vehicle recovery rate was rather high
(near to 100%) and the clear-up rate for car thefts was fairly high as well (thieves
were found in 85 to 90% of the cases). According to investigation service officers,
at that time cars were rarely stolen for financial gains. Vehicle thefts were usually
committed by a handful of deviant youths involved in joy-rides.
In the mid-1980s recorded motor theft rates started to rise. While the average num-
ber of stolen cars in the period 1980–1985 was around 2,000 annually, following
1985 it increased by 18% each year, whereas clear-up rates started to decline.
Totalitarian state controls over the registration of newly acquired cars were nearly
insurmountable for anyone attempting to sell a stolen vehicle. The authorities
scrutinized all purchase details from the origin of money of the willing family to
the technical condition of the vehicle being bought. Thus, there was hardly any
room for a full-fledged car theft market to emerge.
It is safe to claim that up to 1990 stolen vehicles were occasionally sold to in-
dividuals, but no proper auto theft market existed. Soon after the collapse of
communism, though, the motor vehicle components market rapidly developed. In
all probability, the 1986–1987 rise in theft rate was driven by a demand for car
components. Around this time the communist state had relaxed its grip on private
enterprise, and private car servicing and taxi driving started to proliferate. Spare
74
146
The Vehicle Theft Market
parts were no exception from the commodity deficit of the Bulgarian economy,
so car theft fed the demands of the toddling private business.
Despite the lack of consistent records from the early days of Bulgarian transition,
it looks probable that the auto-theft market burgeoned soon after 4,000 prison-
ers were amnestied in mid-1990 and the first signs of institutional collapse in
the fall of the same year. Although hard to define what part of the amnestied
offenders turned to auto theft, it did become the most frequent offense. The
groups of car thieves initially formed round certain experienced hands who had
learned the business in the mid-1980s.
240
On their way to Western Europe part
of the ex-prisoners set up their criminal business in Central European countries,
such as the Czech Republic or Hungary, as it was easier to bypass the rapidly
loosening law enforcement of the former communist states. Most of those newly
formed crime groups engaged in auto theft, as a car stolen in Western Europe
could shortly and safely be driven to Central Europe. Later on, they became
involved in other criminal activities such as pimping (which lead to the quick
emergence of Bulgarian-run prostitution rings) and drug smuggling. The technical
skills and connections with the Balkans and the Middle East of Bulgarian auto
thieves proved to be the key advantage that allowed them to compete with
local and former Soviet Union crime groups. The part of former convicts that
stayed in Bulgaria established the local vehicle theft market and soon got in
close touch with their counterparts abroad. The first cars stolen by Bulgarians in
Western Europe were transferred to Bulgaria in late 1990. In 1992, auto thefts in
Hungary and the Czech Republic peaked, compelling local enforcement agencies
to repatriate offenders or convict them and send them to Bulgaria to serve their
240 One notorious Bulgarian car thief–Radoslav Tsukrovski, a.k.a. Uncle Tsuk–entered police records
in the early 1980s when he was around ten years old. A former officer at the 1st Area Police
st Area Police
st
Department in Sofia recounted the anecdotal case when two traffic cops on duty saw a Lada
moving down the road with no driver to be seen inside. They signaled at the car to stop and
when it didn’t they started chasing it. When it finally pulled up, they found out that the driver
was a boy whose feet were hardly touching the pedals. (see Trud, 14 September 2004).
Trud, 14 September 2004).
Trud
Figure 16. Stolen vehicles and clear-up rate of car thefts
(1979–1989)
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50
Organized Crime in Bulgaria: Markets and Trends
147
sentences.
241
A large group of renown car thieves (including Ivo Karamanski, later
to be known as the godfather of Bulgarian mafia, and a few others, such as Mitko
the Turk and the One-Armed Man
242
), were among those repatriated to Bulgaria
by Hungarian and Czech authorities.
Apart from the formation of criminal enterprises in Bulgaria and their connection
to Bulgarian-run criminal businesses in Central Europe, it is worth viewing local
car theft mechanisms in a larger context.
Rigorous hurdles to private foreign trade lasted up to February 1991, but individu-
als and small companies had started importing used cars in late 1989. As prior to
that demand was largely unsatisfied, such new opportunities became even more
attractive to the people willing to purchase a car. Dealers tried to meet different
criteria segmenting the market according to price, make, year of manufacture,
and country of origin of the vehicle, but the overall home demand could not be
fully satisfied until 2002–2003. Undersupply and the severe lack of import regula-
tions provided fertile ground for the first auto theft gangs to spring up.
Shortly after the fall of the Berlin wall, car theft took endemic proportions in
Europe to form a ”common market” of 5 million stolen cars per year in the early
1990s. As Eastern Europe liberalized its markets, used cars flooded into former
communist states. A substantial portion of the booming used-car market was gray,
as importers commonly evaded taxes and duties. It was quite easy to traffic
stolen vehicles along the used-car routes and channels. In the early 1990s a
huge number of cars stolen from Europe passed through Central Europe before
being transported to the Balkans, the Middle East and the former Soviet republics
(mainly Russia, Ukraine, and the Caucasus).
Bulgarian and other Eastern European law enforcement agencies were poorly
equipped to fight organized stolen car trafficking. The route of a stolen car from
source to end user was a complex chain of 5–6 links involving auto theft groups/
individuals as well as corrupt police and border officers from the various states
which trafficked cars crossed.
Another factor that increased post-1990 stolen car demand was the conspicuous
consumption drive typical for the first years of transition. The nouveau riches
liked to show their Western cars off as a sign of their advancement even more
so than a car showed one’s social standing during socialism. A car served the
purpose of conspicuous consumption better than owning an office or home and
was easier to spot than expensive clothes or watches. In the early 1990s, new
or developing businesses considered it imperative to purchase a car right after
striking a profitable deal. It was acceptable to spend half of a business loan on a
car or buy a luxury vehicle even when the company was going bankrupt as a last
resort to convincing possible partners that their business was sound. As Bulgarian
businesses sought to buy expensive vehicles that they could hardly afford, luxury
241 No precise data are available on those sentences, but some media reports in later periods sug-
gest that many of them did not serve their sentences at all.
242 There are several ”one-armed” auto thieves in Bulgaria, but this particular man is operating
chiefly on the Sofia market.
45
148
The Vehicle Theft Market
cars started to be supplied through the less costly auto theft market offering ve-
hicles at 50% to 70% lower prices.
By 1991–1992, the two major black vehicle markets were fully formed. Car parts
were sold in numerous outlets owned by individuals of Arab origin. The market
burgeoned mainly due to the severe deficit after the trade system among com-
munist states fell apart and car components trade agreements became void. First,
it was nearly impossible to legally purchase parts for East European produced
cars. Apart from that, car sellers could sell dismantled cars at a much higher profit
than fully fitted cars. The great demand for parts entailed diverse infrastructure
and actors, service stations, automotive parts warehouses, car mechanics to disas-
semble the stolen cars, and organized car theft rings.
The second black market segment was that of stolen cars. As institutional con-
trol declined, stolen cars registration became so easy as to make them a widely
accessible item. At first, the local market was supplied with a small number
of stolen Western European average class automobiles. Later, used cars started
to be imported in greater numbers at an up to 200% profit. The import chain
involved Bulgarian auto theft gangs in Central Europe, drivers to transport them
to Bulgaria, corrupt customs and police officers and local used car dealers. Car
thefts at home also peaked, as some of the thieves based in Central Europe re-
turned, lured by the nearly 100,000 imported Western cars found in the country
in 1992. Police figures show that between 1989 and 1992 domestic car thefts
rose by 224%.
Figure 17. Recorded car thefts (1987–1996)
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57
Organized Crime in Bulgaria: Markets and Trends
149
4.2. THE RISE OF RACKET
1992 police statistics show that a total of 12,711 car thefts were recorded, but
interviewed investigators and police officers claimed that around that time citizens
stopped reporting one in every three stolen cars. Underreporting was probably a
direct result from the fact that thieves started offering to recover the car to its
owner if paid 1/3 of its value. Interestingly, ransom for getting one’s car back in
Russia was exactly the same proportion.
The theft-for-ransom scheme created a third specific segment of the auto theft
market. Between 1992 and 1994, the market for vehicles stolen at home and par-
ticularly for trafficked ones was gradually overtaken by the major mafia-type crime
groups in Bulgaria known as grupirovki. In that period most car thieves as well as
grupirovki. In that period most car thieves as well as
grupirovki
the market for stolen premium class cars came to be controlled by one of the
main grupirovki. The criminal private security firms that imposed protection racket
grupirovki. The criminal private security firms that imposed protection racket
grupirovki
on businesses expanded their racketeering services to include protection of private
vehicles. Thus, a refusal to accept the service led to theft, damage, or bombing
of the vehicle. In that period, the racketeers hired the services of various car-theft
crime groups. Due to their connections with police and politicians and capacity to
use violence, the grupirovki also took control over the car-thieves’ groups. In some
grupirovki also took control over the car-thieves’ groups. In some
grupirovki
medium-sized towns this was done rather quickly. In the major cities, such as So-
fia, Plovdiv and Bourgas, extreme violence was used against the auto theft groups,
especially when they had dared against a car owned by an organized crime boss
or crony. Thief chases ordered by victim bosses sometimes went on for weeks, and
when tracked, the group was compelled to sign under the larger enterprise, vouch-
ing to stay loyal for several years as a compensation for the theft.
Some members of the brigades who performed the actual protection racket also
started specializing in car theft using unabashed violence to take away luxury
vehicles at traffic lights, parking lots or even in front of the victim’s home. Cars
were further sold fairly easily, as the thieves did not even bother to forge the
engine or frame serial numbers, knowing that a 5% bribe to a traffic cop would
get them a new registration (e.g., if the car cost on average 2,000 in the then
popular German marks, they would offer a 100 payoff to the official to register
the vehicle and provide a new license plate).
1993 was a key year in the development of the Bulgarian car theft market.
Crime groups got increasingly involved, as together with cigarette and alcohol
smuggling it became the most lucrative black market. The creation of the Schen-
gen area established an EU-wide market for stolen vehicles, which were more
easily trafficked into Eastern Europe through fewer border controls. A car stolen
in Portugal could reach Poland smoothly without checks at the Spanish, French
or German border.
243
Regulatory disparities in the different countries and the
lack of experience of Bulgarian law enforcement and private insurance compa-
nies in dealing with such cases facilitated the car theft market across Europe.
244
243 Europol, An Overview of Motor Vehicle Crime from a European Perspective, January 2006. http://www.
europol.eu.int/publications/SeriousCrimeOverviews/2005/overview-Motor_vehicle_crime_2006_
1.pdf
244 Insurance fraud also peaked in this period. Individuals would sell their cars to crime groups to
traffic them out of the country and after that, report the theft to the police to receive insurance.
214
150
The Vehicle Theft Market
In addition, crime groups from across the Balkans took advantage of already
established trafficking channels for embargoed goods to Yugoslavia to smuggle
stolen vehicles (see Figure 18). In Bulgaria, customs, border-controls and police
were largely controlled by the grupirovki (many of whose members were former
grupirovki (many of whose members were former
grupirovki
law-enforcement officers). Thus, crime groups had ways to track a legally im-
ported car as it crossed the border and further into the country until they found
a handy occasion to steal it. Bulgarian auto theft gangs used this as a main as-
set against other East European crime groups operating in Western Europe even
before 1990.
Two domestic trends also helped boost the market. First, the grupirovki gradu-
grupirovki gradu-
grupirovki
ally spread their power around the country, therefore being able to guarantee
security of insured vehicles nationwide. Besides protection, they now sold the
service of restoring stolen property. The main protection groups were quite ambi-
tious to render services beyond the bounds of a single town, but their coverage
was disrupted by their competing interests. Whether a grupirovka of strongmen
grupirovka of strongmen
grupirovka
originated among athletes from different sports (karate, wrestling, boxing, etc.) or
in a particular town (Pernik, Pazardzhik, Haskovo or somewhere else), conflicts
would periodically exacerbate and despite temporary negotiations or coalitions,
it was market competition that finally ruled. Secondly, the grupirovki were forced
grupirovki were forced
grupirovki
to restrain violent racketeering and to switch to a tactic where car-theft became
an important instrument to racketeer businesses and individuals.
Figure 18. Main stolen car trafficking routes in Europe
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Documents you may be interested