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In Harm’s Way

Forget about Hollywood myths when it comes to protecting employees in global hotspots where kidnappings and political violence are common.

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“My mouth went dry as if I’d eaten a full bottle of Tums, I just had no saliva,” Croke recalled in a telephone interview from his home in Torbay, Newfoundland.

Eight Nigerian militants forced him at gun point to tour the rig. Expecting the rest of the crew to be in lockdown, Croke obeyed. They reached the watertight, bolted doors to the galley, where emergency procedure dictated half the crew would be mustering. But an unlocked freezer door led the militants into the safety area through the galley kitchen where approximately 30 men were laying on the floor. The gunmen demanded to see the captain. When no one stepped forward, the leader shot a single bullet into the floor. It ricocheted and hit Croke, shattering his foot.

After failed attempts to bribe the militants with thousands of dollars in cash and computer equipment, another man was shot in the leg. Then “they gathered all the white people,” including Croke, two Americans, and two French nationals, and loaded them into four boats. Croke lost his shoes in the dark ocean water. The militants hijacked a supply vessel near the rig guarded by Indonesian soldiers and took two more hostages. For the next nine days, Croke was led, bloodied and barefoot, by boat along through the narrow rivers of the scorching Nigerian jungle, sleeping in tents, sustained with instant noodles and, some days, water. Only when the Nigerian Navy began bombing overhead did the militants agree to negotiate the release of the hostages in return for amnesty.

The Business of Kidnapping

While it may sound like a Hollywood movie, incidents like this occur every day. Although worldwide kidnapping statistics are generally underreported and unreliable, ASI Global, a U.S.-based kidnap response firm, unofficially estimates that abductions in hot zones worldwide—including Latin America, Africa and the Middle East—are increasing both in frequency and scope. Numbers are so varied that estimates from myriad sources suggest there are anywhere from thousands to tens of thousands of abductions each year.

“Many victims’ families opt to resolve cases without involving the authorities,” says Mason Wilder, an intelligence analyst at ASI Global. “There are typically large discrepancies between official statistics and unofficial estimates, and there are blurry definitions of what constitutes kidnapping.”

The company has compiled an unofficial list of the countries where kidnapping for ransom occurs most often, including Mexico, Venezuela, Colombia, Honduras, Nigeria, Pakistan, Afghanistan, India, Russia, and Philippines. Statistics Canada data show that approximately 1.8 million Canadians travelled to these hot zones in 2009. Many of these countries share the reputation of being politically unstable, resource-rich nations, which often reluctantly become host to large international firms.

“In Nigeria, for example, most kidnappings occur in the Niger Delta region due to the rebel activity and high concentration of foreign companies there,” explains Wilder. “Poverty, unemployment and poor police capabilities are the primary driving forces behind the growing kidnapping rate.”

The majority of victims are local politicians, oil workers and their families. Many of them, like Croke, are expatriates in the oil and gas industry or construction sector. Extended muggings have also become common, where a foreign business person is detained long enough to travel from ATM to ATM and deplete cash finances. And while Croke was fortunate to be released in a timely fashion, many hostages are held for months, and forced to pay exorbitant ransom fees; some are injured or even killed during the abduction process or rescue attempts.

“There’s been a trend away from a few high-dollar targets to more of a volume business model among kidnappers,” explains Dan Johnson, chief of operations at ASI Global. “There’s a view that the upper and middle class can’t afford security and other measures, offering kidnappers the path of least resistance.”

K&R Myths and Realities

Former British Prime Minister Margaret Thatcher famously declared that negotiating with terrorists would only serve to fuel terrorism. Firms like ASI Global, and its competitor, UK-based Terra Firma Risk Management, (which declined to comment for this article), have their fair share of critics. They, along with their partner insurance companies who provide kidnap and ransom (K&R) coverage, are seen by pundits as perpetuating the worldwide kidnap for ransom business.

The increase in global response firms and K&R products has paralleled the upward trend in abductions, but Johnson believes it’s a chicken-and-egg argument. Kidnapping may simply be an offshoot of the overall increase in international business transactions, he says. As for ransom negotiations, “how else are you going to get them out?” he says rhetorically.

“There’s not a lot of support that comes out of diplomatic channels and if you think the Canadian government is going to send in ten highly-trained ninjas to get you out, you are mistaken,” says Johnson. “And contrary to Hollywood depictions, such as in the 2000 movie Proof of Life, there are no Russell Crowe-type, ex-military cowboys who make stealth entries into mountain camps, kick down doors, shoot down militants and pull your man out.”

“Russell Crowe and I are both incredibly good looking and that’s where the reality of that movie ended,” jokes Johnson. “We believe that kidnap for ransom is entirely a financial negotiation and that we can bring about a resolution financially by coming to an agreed price with the kidnappers. We are guided with one principle and that is the safe and timely release of the victim.”

In the event of kidnap for ransom, family members are best-placed to conduct direct negotiations with the kidnappers based on an established set of protocols. Often, says Johnson, both the abducted and the kidnappers remain unaware of third-party intervention, including if and when there is an insurance policy in place.

“If you are abducted, there is a natural tendency to feel that you have to self-negotiate,” explains Johnson. “You show value so you won’t be killed or won’t be abused. The problem is, if you say you’ve got a million dollars in a retirement account and a three million dollar home, it raises the expectations of the kidnappers. So there’s a lot of secrecy around the K&R policy, who has the policy and who doesn’t. Often the people that have this type of insurance don’t even know they have it.”

ASI Global is the responder for clients of Travellers Insurance, while Ironshore Canada is in the final stages of putting together a program around K&R in partnership with Terra Firma Risk Management. Both insurers were shy about discussing the details around these products with the media.

“This is incredibly tightly controlled information,” says Johnson. “Even we don’t know who among our clients has insurance with Travellers.”

Managing Hot-Zone Risk

While there are no data on the number of Canadians working abroad, Statistics Canada data show Canadians made 53 million cross-border visits in 2009. Because many Canadians fail to register with consular services when outside of the country, this may represent only a portion of the actual trips.

“Corporations need to be focusing on providing proper ‘duty of care’ for their employees when living and travelling outside of their country’s borders,” says Mark Hall, vice-president of business development for medical, safety and security solutions company FrontierMEDEX Group, the parent company of ASI Global which specializes in emergency medical and political evacuations. “That includes medical assistance and evacuation support, and also security, providing proper intelligence, monitoring and support to keep them safe while living and traveling overseas.”

Both ASI Global and FrontierMEDEX Group provide customized training, focused on reducing risks and preparing individuals to respond to fluid conditions generated by unforeseen circumstances, and be more security savvy. The primary training goals entail the protection of human lives, corporate image and reputation, proprietary information and operational assets.

“Every country has its own laws that you must obey and unique customs to be aware of,” explains Hall. “It’s really important to be informed about the simple things like how to meet and greet, how to blend in and how not to offend the host culture. People are looking for cultural faux pas as opportunities, and this is something that can get you into trouble pretty quickly.”

But companies also need to have a crisis management plan in place, which includes who is responsible for overseeing response, and who to contact in case of emergency. Without established protocols, an emergency situation has a tendency to be mishandled, or ignored until it reaches a devastating climax.

“In almost every case, there are series of events that we’re monitoring through our intelligence division that we can proactively anticipate before events unfold,” says Hall. “A majority of our clients hire our company to basically tell them when to worry, so that they can focus on their day-to-day responsibilities.”

In Canada, World Travel Protection Canada Inc. (WTP) offers a travel tracking and monitoring program on a mobile smart device (BlackBerry), keeping clients up-to-date on political and medical risk in various countries, and the relative location of their employees. As the service arm for Zurich Insurance and many white label clients that use WTP emergency medical, travel security and travel assistance services around the world, WTP is one of the largest of its kind in Canada.

“Most corporations have a very good understanding of their fixed assets abroad – their property, their equipment and services – and they do take precautions,” says Abasse Asgaraly, director of new business development for WTP. “But when it comes to mobile assets – travellers and expatriates – they usually have a very substandard understanding of the risks.”

It is essential, says Asgaraly, to have a firm like WTP providing intelligence and advice on potential hot zones, and to have established emergency protocols on what to do in the event of a political or medical evacuation. For large-scale evacuations, much of the advance work is about locating hospitals in the vicinity, how good the roads are, and if there is a possibility of bringing in aircraft.

“We are there to help clients formulate a contingency plan to evacuate people in case of political risk,” says Asgaraly. “When it comes to very specific operations like mining or energy companies, in our business, we cannot improvise. If we improvise, we lose too much time.”

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What every risk manager should know

1. An up-to-date and realistic crisis management plan is essential for every company, every employee, in every location. “If your kidnap response plan includes military intervention from the FBI or the Canadian embassy,” says Johnson, “you may want to revisit it.”
2. All Canadian travellers should register with the Canadian Diplomatic and Consular Services. In the event of an emergency, things can get done more quickly if the government is aware an individual is out of the country.
3. Prepare the traveller before they travel. “That includes educating them on the culture, telling them what the crime rates are, which areas are safe or not, and what to do if something goes wrong,” says Johnson.
4. Kidnap and Ransom insurance is available. For companies operating abroad, especially in the hot zones, this product is essential. But keep it close to your chest. Individual employees and their families need not know the details of the coverage.

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The special case of overseas freelance employees

In February, 20-year-old freelance journalist Jonathan Pednault was in Egypt, unofficially working on a story for L’Actualite, a Quebec news magazine, when he was assaulted and then detained by Egyptian officials. When editor Carole Beaulieu heard of his arrest, she immediately began the procedure to get him out.

Technically, Beaulieu was not responsible for Pednault’s release.

“The rules say that independent journalists are independent journalists,” says Beaulieu. “They are expected to be responsible for their own security and insure themselves. But in reality, we had a duty to take care of him. It was a moral duty, and I expect that as an organization we would not be able to resist the international pressure to avoid this duty.”

The team were fortunate that Pednault had been travelling with two others, one a television cameraman from New Zealand who was able to contact his embassy to negotiate their release. Although the ordeal was over in less than 24 hours, Beaulieu learned more about crisis management planning in that short time than she had in two decades as a journalist.

When hiring freelancers, Beaulieu now insists on having minimal emergency contact information, including a copy of the passport and the name of immediate family. She also encourages independent journalists to travel in groups, and to maintain regular contact with the news room.

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Copyright 2011 Rogers Publishing Ltd. This article first appeared in the Summer 2011 edition of Canadian Insurance Risk Manager magazine.