The Rio de Janeiro Civil Police’s arrest of five Colombians this summer for loan sharking — illegal loans at exorbitant interest rates — using narcotrafficking money drew the attention of Brazil’s security sector, because reports of this practice by narcotraffickers were so far unheard of, Police said.
“This type of activity was reported in the country for the first time. If it existed before, it was nothing important enough to be noticed,” Thiago Moreira de Souza Rodrigues, from the Strategic Defense and Security Studies Postgraduate program at the Fluminense Federal University, told Diálogo. However, militias in Rio de Janeiro, which have a larger criminal portfolio, Rodrigues pointed out, do carry out the practice to some extent.
“It’s likely due to competition. The increase in areas of coverage plus the militias’ diversification of activities in Rio de Janeiro have reduced the space in which the more traditional narcotrafficking groups operate,” Rodrigues added. “What transpires at first glance is that the increase in competition creates the need for diversification.”
The Colombian criminals, who were arrested in the act in the city of Niterói, in the metropolitan area of Rio de Janeiro, will be charged with criminal association and usury, the illegal practice of lending money at unreasonably high interests rates.
“They are Colombians who carried out illicit activities in Colombia, linked to cartels, according to the information we have. So, the money with which they start the [illegal] activity here in Brazil has as a possible origin the narcotrafficking activities of Colombian cartels, which is what we want to confirm. They introduced this practice in Brazil with the largest criminal organization. Their targets are essentially retailers, small businessmen,” Deputy Rodrigo Coelho, from the Brazilian Federal Police Counternarcotics Department, said.
According to the Civil Police, investigations indicated that the group had signed an agreement with the Red Command, one of Brazil’s main criminal groups. During the operation, investigators seized several cell phones, nearly $10,000 in cash, computers, and a hard drive with spreadsheets detailing information concerning the distribution and collection of money.
The police also received information that part of the gang has been based in the communities of Rocinha, and Jacarezinho, in the southern and northern zones of Rio de Janeiro respectively. Documents seized during the arrests revealed that the group charged victims a 44 percent interest rate per month, representing nearly $40,000 in monthly revenue.
“We are in contact with Colombian authorities to find out the criminal history of those arrested. We have information that they have a cell in São Paulo, and we believe that there are groups operating throughout the country,” Deputy Coelho said.
The Civil Police says that the prisoners will be held liable for their crime in Brazil. For Rodrigues, extradition is a possibility. “That’s what has been happening with traffickers arrested and prosecuted in Brazil; usually they also have proceedings in absentia in Colombia,” the researcher concluded.