The Venezuelan government’s failure to prevent the proliferation of organized crime groups means four illicit activities now generate an income equivalent to 15% of the country’s economy, a new report found.
Non-governmental organization Transparencia Venezuela’s Illicit Economies Index analyzed the factors contributing to the prevalence of the new criminal economies during its investigations from 2022 until mid-2023.
The quantitative and qualitative study evaluated four categories: the vulnerability of state institutions, criminal agents, the reach of Venezuela’s criminal economies, and the impact those crimes have on society.
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The report was particularly damning in its indictment of the weakness of public institutions, including the government, security forces, and the justice system, in allowing the growth of organized crime.
Additionally, it measured crime groups’ impact and compared the significance of Venezuela’s illegal economies, including human trafficking, drug trafficking, fuel smuggling, extortion, corruption in ports and airports, and the illicit gold business.
Below, InSight Crime presents some of the report’s key takeaways.
Corruption Permeates Venezuelan Institutions At All Levels
The index slammed the failure of state institutions in tackling organized crime, stating that none of the government’s policies or actions have had any impact in tackling the networks controlling illegal economies.
Corruption levels among state officials, transparency in publicizing information about criminal matters, international cooperation, the country’s justice system, and its security forces all received the worst possible scores on the index, indicating they significantly contribute to the continuance of the country’s illegal economies.
The report underscored the inadequacy of security force operations to effectively impact criminal economies. Researchers highlighted Operation Catatumbo Lightning (Operación Relámpago del Catatumbo), which in 2022 and 2023 aimed to drive out armed groups that occupy territory in the state of Zulia near the Colombian border to control drug trafficking routes. While this operation has led to multiple significant cocaine seizures, there have been few arrests or confrontations to suggest it has weakened the groups it is supposed to have been targeting.
“Mega-operations” designed to combat crime groups have instead been the cause of crimes in some cases. Residents in the state of Guárico complained that security forces began extorting them during Operation Thunder (Operación Trueno), which aimed to root out extortion gangs there in 2022.
Alliances between criminal networks and individuals who hold positions within state institutions have even created hybrid economies, such as scrap metal trafficking or fuel smuggling, where legal and illegal business intersect.
Large-Scale Gangs Have a Bigger Impact Than Guerrillas
The report broke Venezuela’s myriad criminal actors into three subgroups. “Criminal organizations” included the country’s large-scale gangs such as Tren de Aragua. “Guerrilla groups” consisted of two organizations of Colombian origin, the National Liberation Army (Ejército de Liberación Nacional – ELN) and the ex-FARC mafia. Lastly, “facilitators” included figures such as lawyers and bankers who allow those groups to operate.
While both criminal organizations and guerrilla groups were equally ranked in terms of defined leadership, connection to the state, and use of violence, Transparencia Venezuela deemed the former a more significant threat overall due to the wider territorial control they possess.
InSight Crime previously ranked the ELN as Venezuela’s most significant single criminal group, and it has gained further territorial control in the border state of Apure thanks to its success against the ex-FARC mafia’s 10th Front.
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However, while the ELN maintains a particularly strong presence along the Colombian border, a multitude of other crime groups, some well-organized and expansive in their own right, are present throughout Venezuela. The huge number of gangs means together they dominate larger swathes of territory, putting a greater number of civilians at risk of becoming victims as a result.
The index highlighted the states of Zulia, and its multiple extortion gangs, and Bolívar, home to mining gangs like the R Organization, as particular problem areas. Other regions not mentioned in the index also face significant issues with crime groups, such as the state of Guárico, where Tren del Llano demands extortion payments from agricultural workers.
Illicit Gold Reigns Supreme
The index ranked the illicit gold business as the most significant illicit economy, putting it ahead of drug trafficking, fuel contraband, human trafficking, and extortion.
Mineral contraband, drug trafficking, corruption at ports and airports, and fuel contraband were worth a combined $9.4 billion in 2022, equivalent to more than 15% of Venezuela’s gross domestic product, according to Transparencía Venezuela’s report.
While making reliable estimates about criminal economies is difficult, researchers calculated the figure based on factors such as estimated total gold production, drug seizures, fuel prices and production, and surveys related to the pervasiveness of extortion.
Despite high international gold prices driving informal mining in Venezuela and abroad, the report estimated that drug trafficking generated almost three times as much income as the illicit gold business in 2022. But the NGO ranked illicit gold as Venezuela’s most significant illegal economy on the basis of the quantity of people it involves, whether directly or through associated activities such as mercury smuggling.
The government has launched large-scale operations against mining, with security forces evacuating thousands of miners from Yapacana National Park. But these do not seem to have effectively disrupted the criminal groups controlling the business. With corrupt state elements continuing to profit from informal mining, such operations may work to guarantee those elements a more favorable share of those profits, rather than stamping out the practice.