Fronting Drugs: Balancing Trust and Threats amidst Opportunism

• In Event: Organized Crime in Food and Drug Markets

Abstract

Fronting illicit drugs does not appear very rational from an economic perspective. Deferred payment and lack of institutional support to protect the creditor, increases the uncertainty associated with illicit transactions, rather than reduce it. In-depth interviews with 68 incarcerated drug dealers in Norway are used to examine credit in illegal markets. Participants cover a broad spectrum of drug offenses, from lower-level heroin dealers to large-scale cocaine traffickers. Creditors use both cooperative and adversarial strategies to increase compliance with verbal agreements. Several creditors discuss fronting drugs at a lower than market price. The creditor benefits from moving his product faster and the debtor benefits from the discount. The most common adversarial strategy is using threats of violent reprisal in case of inability to repay. A continuum of debt reorganization and liquidations prevent most of the threats from coming to fruition. Iterative exchanges of goods and money, compliments and threats, promotes loyalty and reduces the need for close monitoring of the debtor’s actions. Providing a credit is used both a sign of trust and a way to test the intentions of the debtor. Economic sociology can contribute to our understanding of illicit drug markets.

Authors

• Kim Moeller, Aalborg University, Denmark

• Sveinung Sandberg, Oslo University, Norway