Italy’s Mafia Gets Into Renewables

Imagine Tony Soprano getting a piece of the renewables business.

Well, that’s what’s happening in Sicily.

A multi-year investigation and sting operation there has revealed deep infiltration into the wind and solar sector by Italy’s crime families.

Marco Werman speaks with Anthony Faiola of The Washington Post who’s been following the story.

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Marco Werman: Italy has its own problems with corruption, made worse in parts of the country by the influence of organized crime, better known as the Mafia. Recent scandals over garbage collection in Naples and other cities revealed that the Mafia was heavily involved in the refuse industry. Now comes news that the Mafia has gotten into the renewable energy business in Sicily. Reporter Anthony Faiola writes about it in The Washington Post. He’s just back in London after being on assignment in Sicily. Anthony, renewable energy and the Mafia. I mean, I just have a hard time seeing a Mafia boss driving a Prius.

Anthony Faiola: Well, I’ll tell you what, any time there’s money involved, you’re not going to find the Mafia far behind. And in this particular situation, that’s exactly what happened. Alternative energy over the last decade became an incredibly profitable business in Italy, and the Mafia sensed money and they went for it.

Werman: So what, where do they see the money. Is it in solar panels? Is it in windmills? Something else?

Faiola: Well, it’s both. I mean, effectively what we’re talking about at its most basic root are land deals. You’d identify a suitable spot for alternative energy, say a wind farm or a solar farm, that might not be worth much otherwise. You’d contact, maybe pressure, the landlord, if you didn’t already have control over the land. Then you’d sign up a corrupt bureaucrat who would speed up approval of green licenses, something that in Sicily might typically take years, if ever, to get. And once you had the permit, that land that you had would be worth multiple times more, and you’d turn around and sell it to alternative energy companies. Some of the companies knew what they were getting into, others say they didn’t.

Werman: So with the mafia involved in renewable energy, does that mean this is a legitimate business?

Faiola: That’s a good question.

Werman: I’m trying to compute this.

Faiola: I think what they were getting involved in at its most basic level, like I said, were these land deals, but there is some evidence to suggest that there’s fraud happening on a broader basis. For instance, if you have solar panels in Italy and you’re generating power, you can sell that power back to the national grid and make some money off of that. And there is some evidence to suggest that the Mafia is doing that as well. Now, is everyone who’s involved in alternative energy in Italy involved in some sort of corruption? Of course not. But at the same time, in Sicily what you find is that roughly 30 percent of the wind farms on the island now have been seized by the government.

Werman: This must be a tough one for the government to square because obviously they want renewable energy production. At the same time they don’t want the Mafia being involved with it.

Faiola: Well, that’s exactly right. One of the problems with having the Mafia involved in it, it distorts the market, and it makes it even harder for legitimate alternative energy entrepreneurs to rise up and form their own businesses. I spoke to one legitimate businessman in Sicily who had been in the wind farm and solar panel industry there, and had been brutally harassed by the Mafia for the last several years because he wasn’t willing to play ball with them. He had one of his wind farms, for instance, attacked by an arsonist, doing $4 million worth of damage. And the threats that were made to his family and to his own well-being were so strong that he ended up having to go into some kind of government protection for two years.

Werman: So how did Italian officials figure out that the Mafia was involved, and have they shut down these wind farms now?

Faiola: They’ve shut down some of them, and some of them they’ve actually handed over to the state. And what we’re talking about is a years-long sting operation. I mean, these operations date back in some cases to the mid-2000s. What they’ve done is they’ve meticulously placed wiretaps inside of vehicles, on street corners in some cases, and they’ve developed a network of informants who have gradually been giving them the information that they need to make the arrests. There have been two waves of arrests so far, one in 2010 and one just last December, and my understanding is that there are more coming down the pike.

Werman: Anthony Faiola, the London Bureau Chief of The Washington Post, telling us about the Mafia’s recent forays into renewable energy in Sicily. Thanks a lot.

Faiola: Thank you.

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