Avast, ye! Somali pirates create an exchange for stolen loot

'Bourse' has 72 backer 'companies' that invest cash, weapons and receive a share of the booty

Dec 6, 2009 @ 12:01 am

By Darla Mercado

Market forces work everywhere — even, it would seem, on the high seas. According to published reports, Somali pirates have created a stock exchange to manage their ill-gotten gains. These scourges of the Gulf of Aden have been attracting dozens of investors over the course of the last four months, according to a Reuters report. The burgeoning exchange, located in the coastal town of Haradheere, Somalia, started with 15 “companies” and is now up to 72 entities, the news service found. A wealthy former Somali pirate named Mohammed told Reuters that shares in the exchange are open to all who would like to participate. Investors receive shares in a pirate company by taking part in a raid on a ship. Backers who don't want to go that far can get shares by providing cash or weapons to the pirates. Investors are paid dividends — a cut of the ransom money. Business has been booming. Last week, nine Somali pirates seized a Greek-flagged oil tanker some 700 miles off the coast of Somalia, near the Seychelles Islands, according to published reports. The vessel, the Maran Centaurus, was carrying 275,000 metric tons of crude oil, according to a report from the Associated Press.

There's easy money in capturing tankers, which don't have armed security due to their flammable cargo. The pirates netted a $3 million ransom payment last year when they hijacked the Saudi Arabian tanker Sirius Star, according to the AP.

The activity has helped bolster the local economy in Haradheere, which has morphed from a fishing village to a town where pirates cruise the streets in luxury cars, according to Reuters.

“Piracy-related business has become the main profitable economic activity in our area, and as locals, we depend on their output,” Mohamed Adam, Haradheere's deputy security officer, told Reuters.

“The district gets a percentage of every ransom from ships that have been released, and that goes on public infrastructure, including our hospital and public schools,” he added.

E-mail Darla Mercado at dmercado@investmentnews.com.

0
Comments

What do you think?

View comments

Recommended for you

Featured video

INTV

How InvestmentNews picks its Women to Watch winners

The process is laborious and exacting, but well worth it. The end result each year is an impressive group of women in the advice industry from whom others can draw inspiration.

Latest news & opinion

Some good news about female recruitment in financial advice

Each of four core advisory positions tracked in InvestmentNews' benchmarking study has seen an uptick in women entrants.

10 ETFs that are up more than 35% this year

Amid the stock market carnage, there are still some funds posting big gains.

10 biggest HSA providers rated

Morningstar rated the largest plan providers as investment and spending vehicles.

Morningstar: DOL fiduciary rule reduces inflows to mutual funds with high loads

With the measure's demise, will the SEC's advice reform sustain the momentum?

6 tax strategies for year-end planning

How to help clients maximize their wealth using specific tax strategies before the end of the year.

X

Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print