Kidnap globalises as victim profiles broaden

| August 13, 2009

The news that the UK government considers it unlikely that two more of the Britons taken hostage in Iraq in May 2007 will return alive is a tragic reminder of the risk of kidnapping run by international companies operating in turbulent regions of the world.

If true, four of the five men taken captive while working for foreign firms in the war-torn country have sadly lost their lives.

The whereabouts of the remaining hostage in the UK’s longest kidnap saga in more than 20 years, Peter Moore, is unknown.

Kidnapping is currently more of a global concern than at any time in the past, says security firm Control Risks.

“Not only has the number of countries harbouring serial kidnap groups expanded, but so has the range of victim profiles and demands,” it states in its RiskMap 2009.

“Countries that did not previously have an endemic kidnap problem are developing one,” says Richard Scurrell, Divisional Director of Special Contingency Risks, a unit of Lloyd’s broker Willis that specialises in kidnap insurance.

“We are seeing a growing problem in countries where five or six years ago there wasn't a problem, such as Nigeria, Pakistan and Afghanistan,” says Scurrell.

Last month Somali gunmen took three foreign aid workers hostage during a cross-border raid on a Kenyan town; an armed gang in Mogadishu snatched two French security advisers; while Nigerian militants seized six crew members from a chemical tanker off the Delta coast; and 16 Afghans working for a UN-sponsored demining agency were abducted.

Global spread

Kidnapping has spread rapidly in recent years from its seedbed in Lcatin America to other countries where political instability, social deprivation and weak or corrupt law enforcement offer fertile conditions for the crime to flourish.

Until 2004, Latin America accounted for more than 65% of the world’s kidnaps, of which many took place in Colombia. But by 2008 that figure had fallen to 42%, according to data compiled by Control Risks.

At the same time the number in Asia and the Pacific jumped from 19% in 2004 to 34%, while those in Africa and the Middle East surged from 5% to 18%.

The falling number in Colombia reflects in large part the success of the policy by President Alvaro Uribe (whose father was killed during a kidnapping) to wrest control of large areas of the country held by leftwing guerrillas and rightwing paramilitaries, for whom kidnapping-for-ransom was a vital source of funds.

Within two years of Uribe implementing this new policy in 2002 kidnap rates in Colombia had fallen by 50%. By 2008, Colombia was no longer among the top five countries for kidnappings.

Pakistan now leads the world in the number of kidnappings, with Mexico second, followed by Venezuela, Nigeria and India.

But in Nigeria, Pakistan, Afghanistan and Iraq, kidnappings are often politically motivated, to publicise a group’s ideology, and can be much more difficult to resolve.

Political kidnappings

“Political kidnappings are much harder to manage from a corporate perspective, because the company is, to a large extent, powerless to meet the demands made by the kidnappers. They could be the withdrawal of troops, the release of fellow terrorists or political prisoners. There is little the company can do to exert influence on a government to fulfil those,” says Scurrell.

The picture can often be very confusing. In countries such as Algeria, Colombia, Pakistan, Afghanistan, Yemen and Somalia, criminal gangs may conduct the kidnap but then look to sell on the captives to militant or terrorist groups.

Meanwhile, some extremist groups may make political ransom demands initially, but would secretly settle for cash.

Advice from specialists

During a kidnap the advice of a trained consultant can be crucial. They know the different groups and what their track records and motivations are, can help predict what the kidnappers’ next move may be and can offer guidance on how to negotiate with them.

Buying kidnap insurance guarantees access to consultants, who can be on the spot within 24 hours of the kidnap taking place.

“I see that as the key benefit of the cover, particularly for companies. The largest companies can afford to pay a ransom. What they don’t have is the in-house expertise to negotiate kidnaps,” says Scurrell.

K&R cover

Insurers may pay all the fees and expenses of the consultant, as well as the additional expenses that the company or family may incur, including the victim’s salary, psychological care for the victim’s family or colleagues, medical expenses and rest and rehabilitation costs once the victim is released.

Underwriters may also reimburse their clients in the event that a ransom is paid. They may not always be paid in cash.

“It can mean building a road or a church. It could even be providing football kits. Providing it is legal—we won’t pay for arms or drugs – we will reimburse it,” says Guillaume Bonnissent, Special Risks Underwriter at Hiscox, the world’s largest provider of kidnap insurance.

If a ransom is paid insurers insist on the amount being kept secret. “We try to keep the price out of it. If it becomes known that a family has paid a very high ransom then they become a magnet for other criminals. It’s like the reverse of winning the lottery: you start to receive a lot of letters from extortionists,” says Bonnissent.

International kidnap problem

The international kidnap problem is unlikely to improve and could be set to deteriorate as the global recession continues to bite.

“The situation in Latin America is unlikely to improve, with the financial effects of the credit crunch likely to circumscribe governments’ capacity to invest in the improvements to security and judicial infrastructure needed to make a real difference,” says Control Risks.

The political instability that has seen kidnappings rise in Pakistan, Afghanistan, Iraq and other countries is also unlikely to disappear in the near future.

In a quickly moving international environment it is important for companies to be vigilant of the risk of kidnap for their employees, both foreign and local.

Extra training and bolstered security for vulnerable sites will help, but insurance can offer extra peace of mind.

 

http://www.lloyds.com/News_Centre/Features_from_Lloyds/News_and_features_2009/360/Kidnap_globalises_as_victim_profiles_broaden.htm

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