Remember the Cali Cartel? The Colombian cartel that reigned over 90% of the cocaine trade in the world? Well, the cartel is long gone now, but their innovative legacy leaves on.
The drug trade has seen a significant shift in methods in response to the use of technology for drug enforcement. For instance, drug trade moved to haul shipments via underground tunnels rather than flying over international borders, or hiring drug couriers. Moreover, the drug trade has become more globalised, and a large portion of operations done in South America’s, making the supply chains more complex.
So, how did the old dogs manage the vast empire?
The Cali Cartel was a Billion dollar enterprise that had all their business handled by the Cali Cartel accountants, of course! One of them was Guillermo Pallomari, an accountant to the Cali Cartel.
As the Cali Cartel C.F.O., Pallomari made sure that nobody but himself and Franklin Jurado (another accountant) could decipher the Cali ledger. What was in this ledger you may ask? Just like any other corporate entity, the ledger contained Revenue (daily, monthly, and yearly), Net Income, Expenses (including money funnelled into political campaigns), Total Equity (the value of all stakeholders share of the business), and details of Inventory (what came in and where the stashes are hidden), among others.
Guillermo Pallomari recounted the content of the ledger and money laundering crimes during a court hearing in July 1997. Despite the disappointing end, Pallomari’s role in maintaining value at each level of the supply chain cannot be underestimated.
It’s incredibly complex for all players involved to know the value of their product honestly. Obviously, is such an organisation, there is a significant lack of transparency. It is equally challenging to investigate the supply chains when there is suspicion of ‘unethical’ practices.
Moreover, managing such an organisation can also be highly inefficient, when suppliers, processing and warehousing agents, and vendors connect who needs what, when and how, without a roadmap.
So, how can blockchain help supply chains? While blockchain is popular with cryptocurrency, blockchain technology can be used for any exchange, tracking and, payment processing, synching data with all stakeholders. This fundamental characteristic makes it highly transparent.
Blockchain technology is also highly secure since there is no one central with authoritative powers over the blockchain. It can be incredibly efficient at promoting honour among criminal minds. Moreover, blockchain technology can be highly scalable allowing the cartel to grow in size and territory. The chain of command which is essential to the success of any cartel comes built in.
There is also an inbuilt consensus mechanism that reduces dispute in the cartel regarding transactions since everyone has the same version of the ledger, and can see the chain of ownership.
Ultimately, blockchain technology can improve efficiency, transparency, warehousing, delivery and payment of illegal enterprises.