Honduras Extortionists are Targeting Bigger Companies

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Honduras’ private sector is calling for police to step up action against extortion in response to a series of aggressive attacks by criminals seeking payments from larger companies, an apparent shift in target for extortionists in the country.

On August 26, unidentified assailants in Comayagüela threw a Molotov cocktail at a building belonging to Camiones y Motores S.A. (Camosa), a distributor for agricultural machinery, such as John Deere tractors, reported El Heraldo.

The attack followed another that took place on August 18, when assailants shot out windows of a Camosa store and left a threatening note demanding extortion payments.

According to La Tribuna, the two attacks form part of a series of incidents in recent months whereby extortionists have targeted larger, well-known companies in Honduras that produce items such as bread, milk, and coffee. On August 29 and 30, for instance, two trucks belonging to a grocery distributor were burned in Tegucigalpa, with extortionists leaving behind notes demanding payment of the so called “war tax,” or extortion fee.

In response, Armando Urtecho, director of the Honduran Private Enterprise Council (Consejo Hondureño de la Empresa Privada – COHEP), has called on businesses to abstain from paying extortion fees and to report any criminal activity.

Urtecho also lamented what he viewed as lack of police action to combat extortion, and challenged authorities to be more rigorous in applying the law. He noted Honduras’ large, national-level distribution companies are now incurring extra costs to protect themselves from criminals; something he fears may deter investment in the country.

InSight Crime Analysis

Honduras has long struggled to rein in extortion, a largely gang-driven phenomenon that is estimated to result in total economic losses of $200 million per year — about 1 percent of Honduras’ gross national product — including associated costs like increased security.  

Previously, however, the favored targets of Honduran extortionists have been small- to medium-sized businesses. This has been particularly true for companies within  the transportation sector, which, according to a 2014 government study, pay an estimated $27 million a year. Bus and taxi operators have been a favorite target of the gangs. In 2016 to date, roughly 30 buses have been burned by extortionists in Honduras, a form of intimidation and retribution for those who fail to pay up.

SEE ALSO: Coverage of Extortion 

Recent incidents, however, suggest extortionists are becoming more bolder and more ambitious, and are moving beyond small businesses and transportation companies to target larger, well-established companies with a national reach. While doing so may produce higher paydays for criminals in the short-term, it is also likely to draw heightened scrutiny to the issue and trigger crackdowns by law enforcement.  

Indeed, despite COHEP’s criticism, it does appear Honduran authorities are making some progress in combatting the extortion industry. Over 400 people have been arrested this year on charges of extorting transportation organizations.

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