BUSINESSWEEK ONLINE : NOVEMBER 27, 2000 ISSUE
INTERNATIONAL -- EUROPEAN COVER STORY

Italy: Center of the New Slave Trade (int'l edition)


Dark clouds and lightning cast a gloomy aura over the port city of Trieste on Italy's border with Slovenia. To the northeast, the 50-mile border running along the Julienne Alps is ringed by dense forests, valleys, and caves--ideal terrain for gangs trafficking illegal immigrants into Italy. Each year, traffickers hustle an estimated 35,000 Chinese immigrants through Trieste from Eastern Europe and the Balkans--and from there many are shunted into Europe's black market economy as forced laborers, authorities say. Asian and other gangs revved up trafficking in the 1990s, after the collapse of the Berlin Wall. Migrants are flown, driven, walked, or boated across as many as two dozen borders between China and Italy. ''We imagined there was a problem, but we didn't imagine this magnitude,'' says Nicola Maria Pace, head prosecutor of the Trieste Antimafia Force.

Pace is one of Europe's top authorities on the gangs that run these human trafficking operations. In three years, he and magistrate Federico Frezza and their team have crippled 16 Chinese gangs, arresting 103 members. The most recent coup: In January, they nabbed Xu Bailing, believed to be one of two overlords controlling 16 Chinese gangs that they had identified operating out of Trieste, together with Croat fugitive Josip Loncarcic.

EFFICIENT. Pace doesn't just nab crooks. He studies them. Operating out of two rooms in the city's 18th century Palace of Justice, Pace's team is one of the first to systematically gather data on trafficking. He has accumulated 20,000 hours of wiretapped phone conversations between gang members since 1997.

Pace's research confirms that the trafficking rings are highly organized and global in their reach. The protocol is grim but efficient: Once they land in Italy, Chinese immigrants are held prisoner by the gangs until someone ''buys'' them, fronting the $25,000 fee for their transit and extracting years of labor in return. ''It's big business, and it will continue because there is a big market for it,'' says Pace. In addition to the Chinese, his group also identified 27 gangs from Croatia, Slovenia, the Philippines, and Bangladesh operating in Italy and throughout Europe.

Another key finding: Italy, with its unpatrollable borders and rich underground economy, is the central receiving and distribution center of illegal immigrants for the entire European Union. Trafficked Eastern European women are lined up and auctioned off as prostitutes, much like slaves in the 19th century, to Italian racketeers on a stretch of road between Trieste and Venice. Chinese immigrants, by contrast, tend to be shunted into sweatshops and restaurants. Pace also has come across cases of Chinese ''selling'' a family member into slavery for $5,000 in their hometown. By the time they reach Europe, they are purchased for $13,500.

NUMBERS GAME. Hard to believe? Pace has the database to prove it. The phone numbers his team tapped were found inside the shirt cuffs, shoe soles, or on Band-Aids worn by illegal immigrants who were busted crossing into Italy. Traffickers routinely strip immigrants of their papers, giving them only a phone number of a local contact. ''The hidden phone numbers are the first thing we go for in a bust,'' says Pace. He will never forget the horror of a strange background sound on one of the tapes of a conversation between members of rival gangs. ''It chilled us to the bone when our interpreter explained that what we were hearing was the sound of fingers being cut off'' as punishment for stealing a competitor's slaves, Pace says.

The next step for Pace's team is to uncover possible links between traffickers and the Chinese triads, the Russian mafia, and the Italian mafia. Circumstantial evidence points to collaboration. For starters, Moscow and Kiev are major hubs for illegal immigrants headed for Italy. For that effort, however, Pace and other investigators will require significantly more resources. ''We could double arrests if we doubled staff,'' says Frezza. For now, they still face an uphill battle convincing others that trafficking and slavery go hand-in-hand in the 21st century--and that so many poor people are lured into servitude in the European Union.

''If your choice is to die of starvation in your home country, being a slave in Italy could sound like paradise,'' says Pace.

By Gail Edmondson in Trieste

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