Crime does pay, interview with Bertrand Monnet

Terrorist attacks, money laundering, cybercrime and kidnapping are major threats to businesses that are constantly targeted by terrorists and organised crime. Under the direction of Bertrand Monnet, EDHEC’s Criminal Risks Management Chair has been working on these issues since 2005, and the Chair has established strong partnerships with Orange, Carrefour, Acergy and GDF-Suez. We interviewed Bertrand Monnet, Head of the Criminal Risks Management Chair, to find out more.

What do you think about the emergence of Al Qaida over the last ten years?
Firms have focused largely on protecting their business from the threat of terrorism since September 11, which is only logical: Al Qaida has become a brand, and Ben Laden is a “marketing professional”. He has managed to make states and businesses believe that his organisation is bigger than it really is, and media over-coverage has pushed organised crime into second place. In contrast, Mafia groups are keeping a low profile. We are somewhere between the high profile brand and the culture of secrecy.

And yet organised crime activities have a real impact on businesses?
It’s true that kidnappings and terrorist attacks are major concerns for organisations as they affect the stakeholders directly, but the financial cost of terrorism on business is undoubtedly less than that of organised crime, such as the Italian mafia, whose turnover amounted to 107 billion US dollars.
The mafia, gangs and cartels have countless ways of attacking businesses. Some of them are highly elaborate: cybercrime, money laundering, complex scams… Others are much more straightforward but just as dangerous. These include piracy on the high seas that puts 7% of the global oil flow within reach of Somali pirates (some ship-owners have even decided to join Europe by circumventing Africa, as they did before 1869 and the opening of the Suez Canal), or simple cases of theft: the large oil companies lose between 5 and 10% of their crude oil exports in Nigeria (6th OPEP exporter), at a cost of 3 to 5 billion US dollars a year.
And then there’s also counterfeiting which cost firms around 630 billion US dollars in 2008.

What can be done?
Insurance companies, specialised consultants, intelligence services, the armed forces, ministries of foreign affairs… businesses have strong allies in criminal risk management. But I think that the main solution remains prevention.
In this regard, we differentiate between two types of business population:
• Senior management, including general managers, human resource managers and heads of security, for whom criminal risk issues are likely to be high on the agenda. We’ve created a Criminal Risks Management certificate to match the needs of this public, in collaboration with the Institut National des Hautes Etudes de la Sécurité et de la Justice (INHESJ)
• The operational functions, ranging from the trainee to employees on the point of retiring, who may be able to detect the presence of a risk at source… The Chairs have designed short training programmes for this type of public, specifically geared to the fight against fraud, money laundering and preventing corruption. 
The Chair also trains almost 500 students a year in awareness-raising courses (Bachelor, Master, MBA, and Executive MBA students).

You’ve also developed a risk monitoring tool.
Yes, it’s a little bit my own Criminal Risk Google! We’ve developed a single data platform designed for businesses. This tool has been developed from our research and development programme output, and it’s used every day by some of the leading blue chip companies, which tend to be key targets for mafia activities.
We’ve also published a book resulting from numerous in-the-field surveys conducted in a number of countries (Colombia, Nigeria, China and Italy, among others). Written in collaboration with Philippe Véry, professor at EDHEC Business School, the book throws much light on this topic which, far from happening in some far-flung country, is now a major threat to the free economy, and not just in terms of law and order.

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Written by Jean-Baptiste Damestoy.