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. Last Updated: 07/27/2016

Telling 'Good' From 'Bad'

I wrote in this column a while back about a KGB professional who had written a book about the Russian "thieves-in-law," the local bosses of organized crime. Their power was now so great, he said, that the only way to deal with them was to come to terms, to enter a dialogue with them. He even suggested Russian law enforcement should allow them to police themselves, and so sort out the "good mafia" from the "bad mafia," the way the Japanese yakuza had. I wrote at the time that there was, well ... a certain difficulty with this prescription. Where, after all, would you start? What "good mafia" would you go to to set the ball rolling? Given -- what shall I call it? -- the sensitivity of Russians to people from other nations and republics, they would be unlikely to be Chechen or Azerbaijani or Georgian, wouldn't they? No, they would have to be Russians, locally born and bred. Which would mean, in the end, a policy of no more than Keeping Russian Crime For Russians: a nonpareil local mixture of patriotism and shooting yourself in the foot. In any case, I thought, what exactly was this "good" Japanese mafia the KGB gentleman was pointing to? I decided to investigate. And then I came across the sokaiya. The sokaiya are the up-front-and-personal economic arm of the Japanese yakuza. Their job is protection, which is to say that they guarantee not to mention a company's economic misdeeds so long as the company forks out the traditional "present," which amounts to $100,000 a year. Since well over 1,200 of the biggest Japanese companies do this, this is not exactly chicken feed. Their other job is to disrupt, or threaten to disrupt, meetings -- especially annual general meetings -- which means that the companies can close these meetings quickly and so avoid those silly niggling questions from boring shareholders. (The other way the Japanese do this is by holding their AGMs all on the same day. Nineteen-hundred Japanese companies -- 90 percent of those listed on the Tokyo Stock Exchange -- will be holding their meetings in just five days' time.) Anyway, back to the sokaiya and their "traditional" work -- which can hardly be said to be very time-consuming or demanding. All they have to do, after all, is keep mum, throw some chairs around and lob a few bottles a couple of times a year -- and, bingo, along comes $100,000. Well, that was the way it was, until recently. For times in Japan, as they say, are hard all over. The big companies are not doing as well as they used to. The government has introduced some sort of weird, face-saving law which makes it illegal for them to pay out protection money. And in any case, the whole system is now so riddled with bribery and corruption that threat of exposure no longer carries a lot of weight. The sokaiya are at the sharp end of all this, and their future -- for a while, at any rate -- began to look a little less than lolling-about and rosy. The sokaiya, in response, were forced to dig out all those old-time skills they used to have in the days before the "good" mafia were sorted out from the "bad." Last year senior executives at the scandal-ridden Sumitomo Bank were issued with death threats, and the homes of a number of them were attacked with some serious fire-power. This year, Juntaro Suzuki, the senior managing director of Fuji Photo Film -- the world's second-largest film company with sales of around $20 billion -- was hacked into tiny little pieces by a sokaiya's sword. (The response to this, on the part of Japan's National Police Agency, was a letter of advice to the company chairmen. Among the recommendations: "Try to avoid writing memoranda and letters of apology to sokaiya if you do not want to pay.") The moral of all this, I suppose -- and my advice to the KGB man with ideas on his mind -- is that sorting out the "good" mafia from the "bad" mafia is a pretty expensive way of doing business. And in any case it's awfully hard to tell when the "good" mafia are going to turn themselves back into the "bad" mafia, due to economic pressure or simply boredom. In the words of Hamlet: "If it be not now, yet it will come. The readiness is all." In other words, it's not a lot of good leaving the whole mess for a later generation to sort out. None of this may be very helpful to the KGB gentleman or, God knows, to any of you who are doing business out there. But if it's any consolation, I don't think Japan, in the end, is really a country to which Russia bears much comparison. I actually think the place we ought seriously to think about is Sicily -- but that's another story.