THE BLOG
05/08/2013 01:19 pm ET | Updated Jul 08, 2013

Extortion by Fire: More Mexican Business Are Being Lit Up in Criminal Shake Downs

In broad daylight, armed men pulled up to a well-known strip southeast of Mexico City, unloaded a hail of bullets and threw what early witnesses said looked like Molotov cocktails into a two-story bar, gravely injuring three workers there and leaving the place in ashes. The stunning act earlier this month drew crowds who watched as towering flames engulfed the place.

Authorities confirmed the fire was purposely set but they couldn't pin down what most suspected: extortion. The investigation is ongoing but the blackened bar is just one more reminder just how dangerous extortion has become in Mexico.

Once reserved to Mexico's notoriously violent north, this form of forced payment by fire is one of the latest ghoulish crime trends to grip Mexico. In the last five years the press has documented at least 141 fires in 17 states that likely involved organized crime.

The torching of businesses to collect extortion fees first began cropping up in Ciudad Juarez in 2008 and then spread to the other parts of Northern Mexico. Now its presence is seen in several states including the central state of Mexico, once considered a safe zone but increasingly one of the country's more violent regions.

The spectacular scene at the Cabana and elsewhere serves not only to punish the owner but frighten anyone who thought twice of ignoring the demands to pay up, said security specialist Alejandro Hope.

"The more fear there is, the less you have to use these types of methods," he said, explaining why there is sometimes a rash of fires and then none.

The tactic isn't cartel-specific; instead, said Hope, it's a widely used practice employed by cartel like Los Zetas and La Familia, but also smaller local gangs.

And it's growing as criminal's use of extortion to earn money or gain control permeates Mexico with everyone from local bus riders on their way to work to mom-and-pop businesses being forced to pay up. Homes, local market stalls, factories, hotels, bars, all have been victims of this crime.

For some business owners it's so bad they have to abandon their work. It's also raised worries nationally. A Mexican newspaper recently reported the attorney general's office and the private sector were so startled by a 500 percent jump in reported extortions over the last six years that are working on a prevention campaign. For criminals, it's a profitable business with many of the extortions going unreported and prosecutions rare.

A national crime survey by the government's official statistic agency found 628,912 cases of extortion against business in 2011 -- 92 percent of which were not reported to authorities. The sector hardest hit was small and medium enterprises. In the case of the Cabana, authorities said the bar owners never reported an instance of extortion.

"What we have seen is the closure of businesses that suffer (regular) extortion, mostly small mom and pop stores, restaurants or dry cleaner. But it's a phenomenon of mobility. They close and go to another state," said Ricardo Robles, director of Strategy and Communication in the Public Employers Confederation of the Mexican Republic (COPARMEX).

Smaller businesses that don't have the money to spend on high-end security like large corporations are easier targets for extortionist, Hope said.

Depending on the business, the extortionist can charge anywhere from 10,000 to 500 pesos per week, or about $800 to $40.

Not paying up often means businesses are harassed with calls or sometimes they are watched or their owners followed.

At the Cabana one of the workers suffered burns on more than 80 percent of his body. The bar sits along Avenue San Francisco, in a corridor of nightclubs where violence has been a continual theme over the last three years. Days after Christmas last year, Mexico's Olympic gold medalist in Sydney 2000, Noé Hernández Valentin, was shot in the head at a bar along the strip.

The fire put this brazen daytime assault into another class of particularly horrifying crimes, that has become all to familiar over the last six years as a drug violence has spiraled out of control in the country leaving more than 70,000 dead.

It's hardly the only extortion that turned so ugly. Last August 2011, armed men entered a busy casino and doused it in flammable liquid, then set it ablaze leaving patrons trapped inside. More than 50 people died. Days later, media reported the grisly fire occurred because businessman Raul Rocha, owner of the place, refused to pay an extortion fee.

Even big corporations have not been able to escape. Last May PepsiCo's Sabritas potato chip maker was hit in a series of attacks when delivery trucks and warehouses were torched in the central Mexican city of Morelia. Nobody was hurt but Robles said the fire was set by criminals angered the company refused to make "payments."

Of the 141 fires reported by the media, more than half occurred in just five states: Chihuahua, Jalisco, Michoacán, Durango and Coahuila. Most of these states are home to major drug trafficking routes and are gripped by organized crime.

Although extortions occur in every state, the types of criminal bands that demand payment vary, said Sergio Trejo Hernandez, deputy director of macroeconomic analysis of the Center for Economic Studies of the Private Sector (CEESP).

For instance, the rise in extortion in Tamaulipas can be attributed to its status as a major migration hub, with people from Central America, Tabasco and Veracruz coming through to cross the U.S. border. Many who can't cross become desperate and form criminal bands that take advantage of the locals.

In other cases, it's the police that are doing the extorting. According to the national survey, about 50 percent of cases go unreported because the victim believes authorities were involved. Just the last month, three municipal police in Saltillo were arrested and accused of demanding a merchant pay them 5,000 pesos.

Since President Enrique Pena Nieto took office, he has promised to diminish violence but both COPARMEX and CEESP said insecurity remains a major problem for businesses in Mexico, many who fear expansion because of criminals.

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