The kidnap business

With 200 foreign nationals kidnapped a year, ransoming executives is a boom industry.

Published February 26, 1997 7:39PM (EST)

“we know 'Jose's' style," Chris Marquet says. "We have a history on
him, we've dealt with him before. He knows our people, and he trusts

Marquet heads the risk assessment division of Kroll Associates, a leading international security firm. "Jose" is a code name for one of the
kidnappers of foreign nationals with which firms like Kroll Associates negotiate ransom
deals on a regular basis.

Kidnap prevention and hostage-release services are growth enterprises. A number of these services are on retainer with major insurance companies -- primarily AIG, the Chubb Group and Lloyd's of London -- whose employees are getting sore fingers from writing policies to pay ransoms, and have set up departments with names like
Chubb's "Kidnap/Ransom and Extortion Insurance." On the other side are the kidnappers, consummate professionals who are skilled in surveillance techniques,
communications, logistics and command control, as well as weaponry.

"It's strictly a business for the experienced groups in Latin America;
they don't want to harm the victim," Marquet said. "You play the
game, the guy's going to come back."

Kroll Associates handles up to 40 kidnaps of corporate managers a year. At one
point recently, Kroll was negotiating nine cases simultaneously,
according to Marquet. Based on records of its own cases and others
that come to its attention, Kroll estimates that in the 1990s an average of 200 abductions
of foreign nationals take place every year. The number of local magnates kidnapped by groups of the same national origin is 10 times that.

London-based Control Risks Group, the other major player in the
international security field, puts the average initial demand for returning
abducted North American, European and Japanese executives at $2 million.
The final payment, after negotiations, according to Control Risk's database, is often closer to $500,000. Japanese executives are the most valued target, according to Control Risk's assessment. Ransoms occasionally run much higher:
An estimated $30 million was paid to Mexican kidnappers of a Mexican banker two years ago, and last year German kidnappers got away with $20 million
after abducting a Dutch millionaire.

"At what point in the negotiations does someone decide that the
hostage's life just isn't worth the price?" I asked David Lattin, a Control Risks executive. Lattin, a low-key, tweedy sort reminiscent of John Le Carré's George Smiley, patiently explained that it doesn't work that way. Based on past deals,
there is a known range within which the eventual price will be agreed upon, depending on the caliber of the executive, his or her country of origin and the type of
kidnapper. Even if the initial counter-offer, say $100,000, is far
below the initial demand, it suffices to keep the negotiations going.
The kidnappers, if they possess any degree of professionalism, are not going to
throw away $100,000 for the fleeting pleasure of slitting someone's

Similarly, the corporation that employs the hostage is not
likely to scrimp, even if the abductee is not insured. "If they don't get the
branch manager back, who are they going to convince to be the new
branch manager?" Lattin asked.

The important thing is to keep the negotiations going, Lattin says, communicating with the captors with phrases like "I'm sure we can reach an agreement that is beneficial
to all concerned."

Marquet, who joined Kroll Associates straight out of business school, says some groups will pursue unreasonable demands, "and then you're in for a more protracted, white-knuckled negotiation."
Mike Ackerman, an ex-CIA agent who runs his own Miami-based firm, also
has noted some failings in professional etiquette, such as
"double-dipping" -- making a new demand after an agreed-upon ransom
was paid.

"When I started 20 years ago, you could pretty much rely on kidnappers
to keep their word," Ackerman growled in a telephone interview. "Now you
can't even trust kidnappers anymore." In Colombia, the world capital
of kidnapping, "ELN (National Liberation Army, a guerrilla group) doesn't double-dip; FARC (Revolutionary Armed Forces of Colombia)

The average amount of time a kidnap victim from a
Western country is held is 61 days, according to the Control Risks database. But even when negotiations go smoothly, being
held hostage is a grueling ordeal. "Criminal groups are inclined to
put you in a little hidden room in a house in a slum area," said Ackerman.
Accommodations provided by political organizations are likely
to be more gracious, especially if the group controls territory. But
in that case, they do not have to worry about being found. So time
becomes a negotiating tactic, and the length of the hostage's stay can
easily extend past a year.

After Colombia, the highest incidence of kidnapping of foreign
nationals occurs in Mexico, Brazil, Guatemala, Somalia and the
Philippines. Strictly local abductions are more common in Pakistan
and Afghanistan. In many of these countries,
a guerrilla war has recently been settled or local Mafia groups broken up, leaving trained, often ruthless men with time on their hands and with little prospect for earning an honest living. In Guatemala, kidnap-for-ransom practitioners are likely to be former security forces and death-squad types who used to hunt guerrillas in the hills. In Mexico, the Popular Revolutionary Army, which surfaced late last year in the state of
Oaxaca, told journalists that kidnapping is a
standard fund-raising tactic. Past and present Mexican police are widely believed to be in the kidnap business as well. In Peru, some analysts believe the storming of the Japanese embassy by the Tupac Amaru group was financed, in part, by the $1.2 million ransom paid for the return of a Bolivian cement magnate. Bolivian police arrested members of the Tupac Amaru group in the case.

With multinational corporations forging into new
terrain, and no shortage of ruthless veterans of brush-fire wars in various
corners of the world, Kroll Associates and Control Risks are likely to be in business for a while.

"I don't see any imminent decline," Ackerman says.

Hey, America! A politicized, heavy-handed enforcement approach has utterly failed to control drugs for decades! So, let's increase the budget by $800 million!


During the 1992 presidential campaign, candidate Bill Clinton was fond of saying that "the definition of insanity is trying the same thing over and over and expecting a different result." By that definition, the president's latest war on drugs, announced with much fanfare Tuesday, deserves a shiny new straitjacket.

The only significant change is the total budget -- it's bigger by some $800 million than last year's, and now tops $16 billion. That exceeds the combined budgets of the Commerce, State and Interior departments plus the EPA and Head Start. Other than the dollar amount and some minor cosmetic tinkering, Clinton's new strategy reflects the same cowardly, politicized approach that has squandered hundreds of billions of dollars and ruined tens of thousands of lives. And for what? Teenage drug use has doubled in the past six years.

In his White House briefing Tuesday, President Clinton made much of his plan to spend $175 million on anti-drug television ads aimed at children, along with some more money for other drug education and drug treatment programs. But fully three-quarters of his drug budget still goes to law enforcement, prisons, crop eradication in foreign countries and the laughably useless military effort to keep drugs from crossing the borders. In other words, the same dreary and counterproductive machinery of prohibition that has failed to control drug use for 60 years.

Missing from the strategy is a realistic assessment of what the country's real drug problems are. Getting addicts off drugs -- particularly pregnant addicts -- continues to get scant attention, while the bloated apparatus for hunting down every non-addicted pot smoker in the country gets most of the gravy. The solution offered to stem the violence surrounding the drug trade is more violence -- more police, more prisons, more military involvement -- rather than a recognition that a multibillion-dollar industry with no legal means of adjudicating disputes has little choice but to settle its scores with guns. And in the face of the horrifying spread of AIDS among intravenous drug users -- fully a third of all AIDS cases in the country now originate with a dirty needle -- the government still refuses to make needle exchange a fully funded national policy.

By drug czar Gen. Barry McCaffrey's own figures, 12 million Americans use drugs regularly. Between a quarter and a third of them -- around 1 percent of the population -- are addicted. This says several things: Illegal drugs are only a problem for one out of every three or four people who use them -- a much lower figure than for, say, cigarettes. We are spending $16 billion for a "problem" that is statistically small. The fact that there are 3.5 million addicts in America is certainly worrisome. But consider: 6 million American children go to bed hungry at least once a month. Some 35 million Americans -- one-sixth of the population -- have no health insurance.

In our democracy, defining "the problem" is the ultimate power, because it dictates the range of acceptable "solutions." Administration after administration has defined the "drug problem" the same way because the solutions -- reduced civil liberties, demonized minorities and flagrant scapegoating -- are so politically useful. Until the power to define the problem is spread more evenly throughout society, the "solutions" will continue to benefit the few at the expense of the many.

By Tim Wall

Tim Wall is a writer who lives in New York state.


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