The credit crisis and Japan’s mob

No industry, it seems, is safe from the global economic crisis. It has devastated automaking, investment banking, and now, organized crime. Observers are predicting bloodshed in the streets of Tokyo as rival factions of the yakuza mob retreat from the once-lucrative financial world back to street-level crime.

Last summer, Japan’s National Police Agency warned against the yakuza’s growing involvement in the country’s financial markets, calling it “a disease that will shake the foundations of the economy.” As of August, more than 200 publicly traded companies were on a watch list for suspected ties to organized crime, London’s Times reported. But now the Japanese market has been hit by its worst year on record, and mobsters are returning to drugs and prostitution.

In Tokyo’s glamorous Akasaka district, where the Sumiyoshi-kai gang has its headquarters, new neighbours have moved in. The Inagawa-kai, a rival yakuza faction from outside the city, has set up a “Tokyo liaison office,” according to police. While both factions have roughly the same number of members (about 10,000), the Inagawa-kai has the backing of Sumiyoshi-kai’s enemies, giving it a force estimated to be 40,000 strong. Police are now bracing themselves for an all-out turf war. They suspect mobsters are arming themselves with hand grenades and anti-personnel mines, and there was a spate of daylight killings last year.

Japan’s yakuza generally operates with authorities’ unspoken consent, says Eric Cazdyn, an associate professor of East Asian studies at the University of Toronto. But having two rivals so close to each other might be too much to ignore. Permanent patrols have been set up, and police are working overtime to prevent the market carnage from spilling over to become blood on the streets.