Image from: surfinvest.com

I was just reading Mafia feels heat from feds, crime rivals on CNN. The point was made that we all have to pay for the acts of criminals.

“There is a mob tax placed on everything from your garbage collection, food delivery, the rent that you pay,” he said. “I don’t know what the percentage is, but there is a premium that you pay because of the control that organized crime has on labor unions and on the contractors who are engaged in those job sites.”

I was once an Internal Auditor for Dade (Miami-Dade) County, so I know what they are talking about. It happens. Is Barbados any different?

Barbadian Government classifies fraud as a “victimless” crime.

Why would the Government classify fraud as a “victimless” crime?

Crime Survey 2002

The answer is obvious. So that the public does not get upset when fraud occurs. Let me show you what the cost is. Suppose politicians allow a low-bidder to overrun a project by BDS $200,000,000 (two hundred million Barbados dollars). Lets say there are 100,000 (a hundred thousand) households in Barbados. This means that each household would pay on average BDS $2,000 (two thousand dollars).

$200 Million Unrealistic?

Former Attorney General Dale Marshall said the cost overrun on the Barbados prison was BDS $180,000,000 (one hundred eighty million dollars). You know that these things always cost more than actually stated, so I rounded it up to $200 Million. Whether or not corruption was involved is a matter for speculation, but it must be taken into consideration that top VECO executives have already been convicted of fraud in the US.

Source BFP, June 19, 2007: What Is The Deal With The Prison?
In today’s Nation News, AG Dale Marshall indicates that “the cost of the prison was around US$140 million (BDS$280 million) and not $100 million [the currency was never identified], as he had initialled a document last June (2006) for that amount.”
Way back on June 29, 2005, Mia Mottley announced that VECO had been awarded the prison contract and the price would be “$100 million” … ‘Mottley said Government would have to await the completion of the designs to quantify the finance of the prison, but she estimated it would cost around $100 million’.

Note: Mia made the announcement in Barbados. The other company was British, but was also quoted in dollars. Unless stated otherwise, quotes given in Barbados are in Barbados dollars.

Over Simplistic

Not everybody is in the same tax rate, so if you are in the middle or upper tax brackets then your tax bill may be several time this. (I use the word may because if you are well connected, you may be able to avoid paying your fair share of taxes.) If you are well off, this overrun may cost you BDS $10,000! Ten thousand dollars! And this is just a single instance!

How much are you paying to cover the cost of fraud?

By the way, CNN linked back to this story. This is the fourth time, but someone told me it was a big deal. Click on the image below, and then click on “From the Blogs” to see our link.