The sale of illicit products depends on the acquisition of these same products through theft, smuggling, trafficking, counterfeiting, among other crimes. The unwanted consequences of illicit markets – or negative externalities, as economists prefer – derive precisely from their association with crime to maintain the entire commercial operation, which increases the risk of victimization of people, companies and the environment, the degradation of quality of life and the business environment in Brazilian society.

  • People are affected in various ways with illicit markets. In addition to the robberies, part of the homicides, rapes and assaults are carried out against victims of theft of products, such as vehicles or cell phones, on streets, businesses and homes. The recurring armed clashes between criminals or the armed reaction of thieves, traffickers and smugglers against police forces raise the possibility of an honest citizen being incidentally killed or seriously injured in the main capitals. Another form of silent victimization is a contamination by the consumption of counterfeit or adulterated products, such as cigarettes, pesticides, beverages, toys and medicines, which mainly affects the poorest and most vulnerable. These are also preferred targets of human trafficking for sexual exploitation or slavery-like work, operated by various criminal networks.

  • Companies suffer countless losses when there is an “illegal transfer” of assets from their legitimate owners to criminals through theft, cargo theft and inventories from companies; theft and reception of licensed services; loss of intellectual property of brands and products that have been smuggled or counterfeited. However, we often forget that companies are made by people. In addition to the owners, when a criminal attacks a company, he also victimizes the truck driver, the store salesman, the company security guard or even the customer who is in the store or passing by on the road, during a cargo theft for example. A company loses market to smugglers and counterfeiters and decreases its presence or leaves the country; the worker loses his/her job, which will be transferred to a safer country, where the government fights the illicit economy. This is what we can call “socio-economic secondary victimization”.

  • The environment and artistic and cultural goods do not go without consequences, with animal trafficking, the extraction and illegal trade of wood or works of art, rare books, monuments and historical objects of high added value. The National Network to Combat Trafficking in Wild Animals informs that the illicit fauna and flora market generates around 10 to 20 billion dollars a year in the world, and Brazil would contribute 5% to 15% of this total, especially with the poultry trade. In addition to the destruction of wildlife and the scientific, artistic and cultural damage that this type of illicit exploitation causes, there are losses in the potential for biodiversity, tourist attraction and especially in the country’s socio-environmental responsibility, which is a conditioning element for legal international trade, especially agricultural commodities. Even domestic animals become victims of this criminal network when traded illegally or exploited in illegal games, such as dog and cockfights.

In addition to the direct victimization of the people who make the company, the losses are compounded by the built-in cost of corruption by public and private agents, a necessary maneuver to guarantee the “security of criminal networks”. It is also necessary to take into account that companies also suffer a loss of market for the traders of illicit products, which capture part of the demand with attractive, but unrealistic prices. The risks of loss and the absence of public protection impose more costs on the productive sector, with private security and insurance, which are passed on to the final consumer, which causes an increase in the final price of products to the consumer and a reduction in the competition capacity of national products. All of this ends up affecting the country’s economy, discouraging investments and the emergence of new jobs, so much so that in 2019 Brazil was ranked 132nd out of 141 countries in the Global Competitiveness Report of the Word Economic Forum, an indicator that measures the impact of crime on business.

When the State, through its judicial system, is no longer able to protect society and criminalize those involved in the operations of illicit markets, a state of social and institutional disorder, or anomie, is established, which favors the consolidation of the illicit economy and at the same time destabilizes governments and states. In society, the most common evidence of anomie is the naturalization of the supply and consumption of illicit products, result of the low overall cost of crime. The purchase of illicit products and services is seen simply as a “good deal”, as an “option”, given the attractiveness of the price. And the trail of crimes, suffering and illegalities left behind a stolen cell phone, a fake piece of clothing or a smuggled pack of cigarettes is almost always ignored. In the control institutions, the evidence of anomie is the naturalization of internal inefficiency and corruption. The absence of clear and efficient laws and an effective infrastructure for the fight and control of crime weakens the internal commitment to results, feeding chronic inefficiency and corruption, and transforming the lives of public agents, the overwhelming majority honest and dedicated, in real Calvary.

The reversal of this situation requires updating and modernizing the criminal justice system to recover its ability to impose high costs on crime, especially those dedicated to the supply of illicit products.