“We negotiated for 71 days and ended up paying a ransom of $1.7 million,” Gary Skjoldmose-Porter, Danish Clipper Group security manager told The Independent.
In 2008, a company-owned ship was hijacked near Somalia — one of the 170 vessels that were captured between 2005 and 2012.
While each pirate — depending on involvement and weapon accessibility — can net up to $75,00 per job; collectively, pirates, government officials and middlemen have earned an estimated $400 million, the article said.
The World Bank, Interpol and the United Nations Office on Drugs and Crime released a report titled “Pirate Trails: Tracking the illicit financial flows from pirate activities off the Horn of Africa,” which disclosed that between 2005 and 2012, $339 million to $413 million was collected through requested ransoms.
Holding hostages or ships until the money is delivered by air, Skjoldmose-Porter noted that the pirates were well connected and trained, demanding ransom amounts in English.
“They knew exactly what they wanted,” he added. “They were smart, organized and ruthless.”
According to The Independent, working professionals on the local level, such as cooks and lawyers, aided pirates often pocketing a portion of their earnings.
“It is immensely profitable. Ransoms are invariably paid in untraceable cash bundles and these are smuggled out of the country, through Somalia’s porous borders,” Stuart Makanda Yikona of the World Bank said.
Some ships were captured and released for $500,000 while others were held for a $5 million ransom — most of them money ending up in, or routed through Somalia. The Independent wrote that investment businesses, hotels and restaurants in the country are potentially backed by the illegal funds, which have more recently been targeted and tracked to beneficiaries. What started out as a “family business,” — where operation expenses tallied in the low hundreds — piracy evolved into a much larger operation where financiers and investors were thought to have injected up to $10,000.
These large amounts of capital are used for recruitment, drugs, fuel, food and water, weapon purchases and master planning by a lead pirate.
While Somalia doesn’t have the resources to monitor piracy attempts in the Gulf of Aden and other areas near the country, hijackings have dropped significantly since 2011, the report said. Efforts by the Combined Task Force 150 — a multinational naval group — have greatly contributed to the decline in attacks.
