WBD507 Audio Transcription
Can Bitcoin Help Tackle Human Trafficking with Victor Boutros
Release date: Monday 30th May
Note: the following is a transcription of my interview with Victor Boutros. I have reviewed the transcription but if you find any mistakes, please feel free to email me. You can listen to the original recording here.
Victor Boutros is CEO and co-founder of the Human Trafficking Institute. In this interview, we discuss the anger that drove him into tackling human trafficking in the US and then set out to prove it could be tackled across the globe. His work literally saves lives. He needs support.
“When you look at the giving trends of the Bitcoin community, what’s interesting is they’re not like the traditional philanthropic community, they’re not really interested in Symphony tickets, or the art. They’re looking at ‘where are there game-changing impacts that if they were scaled would have world-changing effects, and have world-changing effects for human freedom?’”
— Victor Boutros
Interview Transcription
Peter McCormack: Hi, how are you doing, man?
Victor Boutros: I'm doing great.
Peter McCormack: Thanks for coming in to do this. We had an introduction through a good mutual friend of mine, and this is a little bit more of a serious story than something we usually cover, but I think it's something we should talk to people about on the show. I think human trafficking is obviously a complicated and terrible subject, there are a lot of victims, and I think it's important for you to come here and tell people about the great work you're doing.
I usually sit here with a pile of questions, but I think with this one, I just want you to tell your story and then we'll dig into it. Just give the background of how this became a subject you wanted to work on.
Victor Boutros: Yeah. I knew virtually nothing about human trafficking really until graduate school, and began to travel, especially in the developing world, with some other students and friends; and in my case, the first case I came across was a case involving a 12-year-old girl who was from a very poor family. Her family sends her to the big city for the summer to get a job, where she could earn some money that she could bring home to the family.
She gets a job in a restaurant washing dishes and earns some summer money, and then is getting ready to head back home to her family. To do that, she's got to catch a train from Victoria Station in Mumbai, which is a very, very crowded train station; I think something like a million people a day are going through the station, and she's just confused by the chaos, she can't find her train. A couple of older ladies see her struggling and approach her and say, "Hey, are you doing okay?" and she says, "I can't find my train". They say, "Where are you going?" and she tells them and they said, "Oh, we know where that is. That's actually on the same line that we're on, we'll show you".
So, she's kind of relieved to have these ladies looking out for her, and so she hops on the train. They start chatting, they have some tea. It turns out the tea is drugged. So, she's knocked out cold and when she wakes up, she finds herself on the third floor of a brothel in the red-light district where she's been sold for the equivalent of US$250. From that point forward, the trafficker tells her, "You're now going to service the customers at the brothel". She says, "I just want to go home", and he says, "That's not really an option for you anymore. I paid good money for you, you're now going to make money for me", and he sets a quota. She has to service 7 to 12 men a day, 7 days a week.
Peter McCormack: At 12 years old?
Victor Boutros: At 12. And meanwhile, here's her family at the rural train station, has no idea where she is, they don't know why she's not on the train and they don't even know how to start looking for her. As I learned about that story, it just made my blood boil. How do you do that to a 12-year-old?
Peter McCormack: How did you come across the story though?
Victor Boutros: A friend of mine had started an organisation that was starting to look proactively for these kinds of cases, and it was through him that I learned about this story. You hear a story like that and you feel like, in a world of moral grey, there's a lot of moral grey, there's a lot of nuance, this is pretty black and white, and it's pretty clear to me that 12-year-old shouldn't be there.
So, there was a big party and it was like, whatever it takes we have to get her out right now, you can't let that continue. Then you start to learn about the scope of the problem and you hear, there's 25 million people who are in that same position today. All of a sudden, it's like your soul is divided into two parts. One part is going, "Get her out now"; the other part is going, "Wait a second, you can't get too close to this", because 25 million victims, whatever they do, it's just going to be a drop in the ocean, it's not really going to make a difference.
It's like getting too close to a fire that you can't put out, you've got to back away, you're going to get burned. I think as long as you're in -- it's a very painful position to be in, to feel there's something this horrible that's happening that has to be stopped; and at the same time, I don't feel that there's anything meaningful -- I feel very powerless and feel like there's nothing that I can meaningfully do to put a dent in it, and that is just a very painful position to be in.
For whatever reason, for me, really probably for the only time in my life, this clear sense of, "Hey, I think this is what I'm supposed to do", and I just thought, "Maybe it's just an emotional high and it will go away", and it just never did. So, at that point it changed the course of my life. I was, at that time, in a graduate programme in the UK at Oxford, and left that early to go to law school, really with the idea of being involved in this type of work.
So eventually, after working for a judge and being in the private sector for a number of years, moved to DC in 2007 to join the US Department of Justice, which was just forming its first ever Human Trafficking Prosecution unit. So, this was the first group of federal prosecutors that would focus exclusively on human trafficking. And for almost a decade, that was my job. I'd get up on a Monday morning, travel round the country, work with a team of federal agents, FBI agents, Homeland Security agents, and we just started working these cases from start to finish.
Peter McCormack: Domestic or international?
Victor Boutros: There were cases where the victims were here. Some of the victims were from other countries but ended up here, and a lot of the victims were domestic. Actually, that was something that was quite surprising to me. I think a lot of the news stories, and maybe movies you see, would make you think -- and even the name itself, "trafficking", sounds like it's about movement, it sounds like it's about crossing borders. And yet, the vast majority of victims never cross a border of any kind. Really, I learned that's because traffickers are really in it to make money. It's an economic crime, it's a cost benefit crime, and so they kind of think of it like a business model.
If you're a trafficker and you're thinking, "I want to make money; maybe I'll do that through commercial sex", which we call Sex Trafficking", maybe I'll do it through some other industry, a hotel, a restaurant, a brick kiln, but either way I need labourers to do it and I've got a fundamental choice. I could either use voluntary labourers, who I've got to pay some kind of competitive wage to and keep them happy, or they'll go somewhere else; or I could use force and threats and violence, coerce them to work for me and prevent them from leaving. As long as there's no real consequence for that, then all my labour costs magically get turned into profits, so I'm just going to make more money".
That's why, when we look at the global landscape, what we see is that trafficking just explodes in places where the laws are not enforced. It doesn't really matter for the traffickers whether there's laws in the books, as long as those laws are not enforced.
Peter McCormack: So, it sounds like slavery is essentially a component of trafficking?
Victor Boutros: Yeah, and there's debates about what the right terminology is, but yeah, I think there's a large group that calls this "modern slavery". And really, at the heart of the crime, it really is about overcoming the will of another person, it's about taking away their freedom to make choices about where they work, what they do, who touches their body. So fundamentally, it really is about control of another person and robbing them of their freedom.
Peter McCormack: Yeah, so the traditional kind of cases I've heard about is Eastern European girls being moved across Europe for sex work; maybe South Americans being moved, again traditionally for sex work; occasional cases of children -- I've heard a number of cases with regards to India. Can you just give me an idea of the range of cases and who it affects; is it mainly women, mainly women and children, or are there a surprising number of adult men who are trafficked; what's the range we're dealing with here?
Victor Boutros: If you think of human trafficking as the umbrella term, and you think of the two buckets within that as sex trafficking and labour trafficking, about 20% of the world's victims are sex trafficking victims; the other 80% are labour, and really that's not surprising if you think about it, because really it's the same business model. What we've done is just take one specific type of behaviour, which is commercial sex, and say we're going to isolate that specific industry, so to speak, and we're going to call that sex trafficking. And then every other arena, we're going to call labour trafficking. So, that includes every other type of industry from agriculture to domestic servitude, to hotels or restaurants. Everything else gets called labour trafficking.
So, on the sex trafficking side, the evidence is that the victims are overwhelmingly female. On the labour trafficking side, it's a more even split. Now, even on the sex trafficking side, there are non-female victims. There are boys and there are others who are targeted for sex trafficking; but on the labour trafficking side, it tends to be a more even split.
It terms of geographic distribution, this was one of the shockers for me, when I was at the Justice Department, I had an opportunity to take a sabbatical and work on a book that I work with a friend of mine, called The Locust Effect: Why the End of Poverty Requires the End of Violence, and in that book we looked at the global landscape and discovered that 93% of the world's victims are actually in developing countries, which blew my mind; because you think about that, that means that even if somehow we magically could eviscerate all trafficking in the United States and the UK and Western Europe and Australia, Japan, we'd still have 93% of the victims out there, which means we really can't impact trafficking at scale if we're not impacting traffickers in the developing world.
Peter McCormack: Is there any form of voluntary trafficking for consideration here? So for example, there are people who want to move across Europe to try and get into the UK. We know there are gangs which help people cross from France into the UK on crappy boats. We had a sad case a few months ago where a boat sunk, I think about 30 people died. Is that considered part of trafficking, even if it's voluntary, if the person wants to pay to be trafficked?
Victor Boutros: So, trafficking itself can never be voluntary.
Peter McCormack: Okay.
Victor Boutros: There's a different crime called smuggling, which I think is kind of what you're referring to. Smuggling is really a crime against the borders, and that can happen either voluntarily or involuntarily. So someone could say, "Yes, please help me, I'd like to be crossed, even illegally, across a border into another country". That's a smuggling operation. It necessarily involves the crossing of a border and it can be voluntary or involuntary.
With trafficking, no movement is required, no crossing of borders is required. Really, the essence of the crime is coercion. It's about using force or threats or violence to coerce someone, either into commercial sex, or into some other form of labour, and that can happen to the person next door. So, no crossing of any kind of border is required; movement is really not an element of the crime at all.
Now, there's a Venn diagram, as you can imagine, where there are cases that involve both smuggling and trafficking, but the terms themselves, in fact the term trafficking, it does sound like it's about movement and so, nine times out of ten, you pick up a story and you read it in the newspaper and it's talking about trafficking, and you dig into the facts and it's really a smuggling case. So, I think there's a lot of confusion around that term. But there are really two distinct crimes that sometimes overlap.
Peter McCormack: Okay. In the bucket of labour trafficking, when you discussed 93% being in the developing world, I actually wasn't surprised about that. I'm actually surprised that cases really do exist in the developed world. I mean, I know stuff would be, but I would have thought it would be extremely rare, just because we live in a developed, western, liberal democracy. I say, outside of sex work, because I understand the coercion there, but I would have thought most people could escape these situations if they didn't want to be. What do I not understand about how this works and how people are coerced?
Victor Boutros: Well, I think one challenge for us, especially in the West, is that this crime is, by its very nature, very hidden. So, unlike say a natural disaster where the tsunami is not hiding itself, the tornado is not hiding itself, it's very visible for people to see. Often, other humanitarian disasters are very visible. But in this particular case, you have a trafficker who is deliberately working to hide from view the crimes that are taking place.
So for instance, in labour trafficking, you may never see the person who makes up your room, cleans your room at the hotel, or you may never see the person washing dishes in the back of the restaurant. And even in the cases of commercial sex, where there's force or violence coercing them, there's also a lot of pressure by traffickers for their victims to appear enthusiastic about the commercial sex interaction, and there's punishment and harm to them if they don't. For that reason, it's often very, very hard for us to see.
Then this tragic irony, the victims often feel so ashamed and embarrassed by what's happened to them that they also want to hide it from view. So, almost all the human actors that are involved in the process are all deliberately hiding it from view, and that's one reason why it's very hard for us to see and we feel like, "Gosh, you travel a lot, I travel a lot, why are we not seeing more of it?" The reason is, because it's so hidden, you've really got to know how to look for it, and you've got to develop even specialisation in enforcement to go out and find it.
So, it's one of those crimes, unlike a bank robbery where someone raises their hand and says, "I'm the victim of a bank robbery, a crime has been committed, come let me tell you about it", you've really got to develop proactive investigator strategies to go out and find it, because it is so hidden.
Peter McCormack: But what are the components of the trafficking? My assumption is that there is the person who finds people to coerce and traffic, there is the act of moving people, if it is required, and there is the person recruiting. Can the person recruiting not realise they're recruiting people that have been trafficked, or is it always multiple parties complicit?
Victor Boutros: So there's different roles, and sometimes all those hats are worn by the same person. So, you may have one person that's doing the recruiting. In the case that I mentioned to start our conversation together, the 12-year-old girl, you had the two older ladies who are drugging and abducting this girl and delivering her to the red-light district. Now, they obviously know that she's underage and she doesn't want to do this, but they also know there's a predictable buyer on the other end, so they're willing to undertake all the effort and risk, because they know there's a predictable buyer on the other end who will buy that victim.
The trafficker himself also knows, here's a 12-year-old -- this is the brothel owner, he knows it's a 12-year-old, she's unconscious, she's underage, she doesn't want to be here. But from his perspective, he thinks, "I can command this kind of revenue", to put it in really crass economic terms, but that's how they think, "from this person, so I'm going to make back the money, my initial capital investment. I'm going to have a great ROI [Return On Investment] on this victim". So, from their perspective, they all know that they're involved.
Now, is it possible that you can have a recruiter who is hired by a trafficker, and doesn't realise that they're recruiting for a trafficking operation? Yeah, it's possible. So, it is possible that you have people along the line who are unwittingly facilitating, which is not a crime if it's genuinely unwitting and unknowing, but you also have knowing facilitators, and now in the US, that itself is a crime.
Peter McCormack: Right, okay. And with regards to, let's talk about, say, the US, can you just give me some examples of specific labour crimes that you've seen with regards to trafficking, just so I understand the picture, because I think sex trafficking we'll cover separately, and I think that's an easier to try and come to some assumptions with. But labour trafficking with regards to, you talked about agriculture or farming; that's where I specifically asked, could a hotel owner not realise they're recruiting people that have been trafficked?
Victor Boutros: Yeah, so we do see, and we put together actually a report called The Federal Human Trafficking Report, which has now mapped out 20 years of cases of actually every single federal human trafficking case since the law was created in the year 2000, and we map out the trends there, and that's available online for those who want to dig in more deeply to the data. I know this is a community that's very data-driven. So, traffickinginstitute.org is our website, and they can go check that out there. It's the Federal Human Trafficking Report. So, you can see the breakdown of what are the most common industries.
But yeah, agriculture is a common industry, so you may have agricultural workers that are coerced into operating in a tobacco field, or in some other agricultural enterprise. You've got domestic servants. These are folks who are cleaning or caring for children, doing kind of nannying and cleaning services and those sorts of things, that are also -- we see trafficking in those industries. I did a case early on in my career at the Justice Department involving a restaurant owner that was coercing labourers from overseas into working at the restaurant for virtually no wages, and was preventing them from leaving.
So, those are examples of different industries that this takes place on the labour side here in the US, and that may look a little different as you move out into the rest of the world. But the business model is always the same, which is the traffickers thinking, "I'm going to make more money by coercing the victim and saving labour costs, than I would if paid voluntary labourers to do this".
Peter McCormack: So, are there specific things that make it easy to identify if something is coercion? Does it come down to the rates of wage? How do you actually -- because I'm assuming, again, within that there are some things that are not easily identifiable?
Victor Boutros: It's not simply a labour violation like, "I didn't dot my i's and cross the t's on the labourer", "I underpaid them [or] I didn't pay overtime like I'm supposed to". There's an objective component and a subjective component to it. So the objective component is, would a reasonable person in those circumstances feel like they weren't really free to leave or to do something different? So, the types of coercion the traffickers use are actually quite ingenious.
I remember there was a case where the defence attorney in his closing argument was trying to argue that his client had not committed trafficking, and he said, "It's not like he held a gun to her head 24 hours a day". If you think about it, the cost of having someone who would hold a gun to someone's head 24 hours a day is quite incredibly expensive; that's very, very onerous. So, traffickers are thinking, "Are there much more efficient ways that I can coerce someone?"
So, "Can I say, 'Hey, look, if you don't --'", because sometimes they'll have a smuggling operation where they say, "Okay, you mortgage your house [or] you mortgage the money for your family to pay to get to, say, the US", and then they say, "You're stuck here until you pay off this debt", so you have this form of debt servitude. And often they'll charge exorbitant interest and then, "You'll have to stay where I tell you to stay and that's going to cost you this" and then, "You're going to take the food that I'm going to require you to eat, and that's going to cost this", so you end up working for free for sometimes decades, because you are never even making a dent in this debt.
Sometimes you have victims who don't have the resource or background or experience or education to really say, "Well, I'd like to press into that more", and of course, there are sometimes threats of violence to you or to your family back home if you push back against those things. So, those are some of the different elements that we see of ways that traffickers will use to coerce, and traffickers come up with increasingly ingenious ways to coerce their victims over time.
Peter McCormack: Does that become difficult to prosecute? Is there a high success rate on prosecutions?
Victor Boutros: Yeah, here in the US there is. So, here in the US, the conviction rate is quite high, and that's because there's also quite a high standard for even bringing a case in the first place. So, these cases, what we found is that specialised units make a huge difference in the success of these cases, because the way that you build them, from the very beginning of the investigation, all the way through trial, is actually quite specialised.
So, when you have a specialised team of police and prosecutors and victim specialists that are all working together to bring the case forward, then that's where you have your highest success rates. But the conviction rate is actually quite high here in the US.
Peter McCormack: How do they even investigate and find? Is it people are reporting? As you said before, it's hidden, so then how do you find it?
Victor Boutros: Well, there's a variety of different ways. So, we do sometimes get reports, either from victims, or from third parties who recognise something is off. They see, "Well, how come this domestic server at this person's house never goes out? I never see them, I don't see them going for a walk, I don't see them seeing any friends, I don't see them walking to church, it's kind of weird. I want to go to their house, I don't see them". So, you'll have people who will just notice something off and they'll report it, and that just sparks an investigation.
You'll have cases where the healthcare system notices something. You'll have someone who is now injured, or you have sometimes forced abortions or some other sort of medical procedure that is required for a victim, and the trafficker shows up, and you'll have a medical person who are like, "That doesn't really make sense. He/she is saying it's their older brother, but it doesn't seem like an older brother relationship to me", and they'll separate them and then start to get information that leads to a trafficking investigation.
Then, you have now proactive undercover operations, where you're going out and actively, proactively looking for it. We have law enforcement that are going in and attacking a specific business model and trying to find it, and that's where I think we see some great results as well.
Peter McCormack: Okay. And, if anyone was listening, myself or anyone here, are there things you want the public to be more aware of. Do you think this is something we have as a collective duty just to observe and report? Are there things that, you say it's hidden, but we may miss; but if we learn to recognise them, we could perhaps help?
Victor Boutros: Yeah, honestly I think people do talk about specific things to look for, and I would encourage some of those things. But a lot of those times, it's a spidey sense, it's kind of, "This doesn't seem right". Like that nurse just knew that this story didn't add up. And the thing that really made the difference is, she did something about that spidey sense, so she said, "Gosh, this doesn't sound right, so I'm going to actually take the next step and make the call to the Human Trafficking Hotline, and just do my duty, and I'm going to put it in their hands and the experts can take it from there.
But often, you just suppress that, you're like, "Well, I don't know, maybe he is the brother. I don't know, I don't want to mess up something here", and so you sort of just stay passive. So, I do think it's great for folks if they do see something off to just go ahead and report it, and let the law enforcement professionals jump in and take a look. So, I think that's a wise thing to do. But I think the other thing is, the more that we can actually concentrate resources in the specialised units, that that's all they do is they go out, they know how to look for it, they know how to find it, they're crafting proactive investigative operations to go after it, I think that's where we'll see our biggest yield.
Peter McCormack: Okay. Let's talk specifically now about sex work. I want to understand a bit more about that. So, there's a lot of discussion, and I've had it covered on my show, and some people believe sex work should be decriminalised, should be legalised; that would protect people, that would reduce risk for sex workers. There's other people who think it shouldn't be and it should be criminal. Is there any data or evidence that leads to helpful conclusions with this kind of question?
Victor Boutros: On the decriminalising question, we actually hosted a little debate on that front. We have some fellows who are just exceptional law students that are Frederick Douglass Fellows, and we did a debate on that at the University of Virginia. So, there definitely are very interesting compelling arguments on both sides. The one caution I would have is, I do hear the argument that, if it were legalised, that would reduce the amount of trafficking. And, at least in my experience, there's reasons to really question that.
When I was at the Justice Department, we had actually a group from the Netherlands of prosecutors and police reach out, and there's actually a Harvard Kennedy School Professor who brokered a conversation where they said, "Look, we've got this problem, which is we've legalised commercial sex work, and yet it really hasn't reduced trafficking. We still have essentially the regulated sex industry that's taking place here, and then you have this unregulated, underground sex industry, which includes sex trafficking, where there's force and coercion and people who are victims, that's also taking place", which if you think about it makes sense.
If you're a trafficker thinking, "Well, if I go the regulated route, I've got to pay taxes, I've got a smaller group of victims that I can choose from, and I've got to pay wages. Whereas, if I can operate underground and use force and threats and violence, I've got a larger group of people I can pull from, I can go after children as well as adults, I can create violent pressure that prevents me from having to pay them, so all my labour costs turn into profits, I don't have to pay taxes", and so it becomes a similarly lucrative enterprise. So, I think the Netherlands, at least with that group, that stuck out in my mind as, "Maybe this is not a panacea to solving the trafficking component of what's happening in sex work.
From my perspective, what does change that is when you have, and I think there is data on this, that when you have increased enforcement against sex trafficking, that is where there is force, fraud or coercion, or there's underage victims, what you're doing is you're really shifting the demand of the trafficker for forced labourers. So, to go back to that original example of the 12-year-old at the brothel in India, let's say that we send a specialised unit and they really start cracking down on sex trafficking, that is victims like this 12-year-old, or who are being coerced there. Now, how does that change the business model of the brothel owner when those two ladies come and show up with an unconscious 12-year-old girl?
Once that happens, he says, "Wait a second, she's 12? She's underage? She doesn't want to be here? Not interested, because I take her, now all of a sudden this specialised unit could come in and seize all my assets, and I lose all my revenue, my entire business, my family, my freedom, go to jail for maybe the next 15 years; not interested, when all I have to do to avoid that risk is shift to voluntary labourers exclusively, that is those who are making some kind of economic decision to engage in sex work, and then I avoid that risk altogether".
The moment he makes that choice, these ladies are only willing to undertake all that effort and risk if they know there's a predictable buyer on the other end. So, once that dries up, so does their incentive to go out to the train station and look for 12-year-olds that they can drug and bring to the red-light district. So, that's where I think we can make a tremendous difference, is when you increase enforcement; it really changes the risk catalyst for traffickers. It doesn't eliminate sex work, but it does really decimate the component of sex work that's really using force and threats and violence and coercion and underage victims to engage in commercial sex.
Peter McCormack: So, how do you do that; how do you have greater enforcement?
Victor Boutros: Well, the thing that was quite interesting to me was when I first started at the Justice Department, we had this quite interesting challenge, which I was travelling round the country, and you'd see these prosecutors and agents who seemed like, "Working on a trafficking case, that's a pretty morally compelling thing to work on. If that's out there, that's the kind of case I'd like to work on", and yet we were seeing very few cases and we're trying to figure out what's the disconnect. We've got good laws, we've got smart, motivated prosecutors and agents; why are we not seeing more cases?
We discovered it's just a very specialised area of law enforcement, and that's not that unusual. But normally, when you have a specialised area of law enforcement, you create a specialised unit. So, you have a narcotics unit, or an organised crime unit, that's going to focus on a specialised area of crime. What happens when the enforcement of the crime is still so new that there's just no one down the hall? I can't walk down the hall and say, "Hey, Peter, you're our expert on trafficking cases, how do you do this, how do we even start; how do we go find this stuff?" When there's no one down the hall, you don't want to screw up professionally, especially when there's a bunch of very traumatised victims on the other end, and so the cases weren't happening.
So, what we did is we worked together at the Justice Department with some other federal agencies to create a pilot. We went to the 94 federal districts in the US and we said, "Hey, you guys compete for six lots that will participate in the pilot, and those pilot districts will do three things. First, we'll just almost build a mini, specialised unit. Here's our team, here's our prosecutors, here's our federal agents, we're now going to work on trafficking cases".
Secondly, we'd walk them through, "Here's the strategies and interventions and tools that we've seen that actually are effective". And the third thing is, they'd go back to their home districts and we'd pair them up with me, or another prosecutor in our national unit, and we'd fly out there and just role up our sleeves and start working cases together. And of course, there's all kinds of problems that come up that you never anticipated in the classroom, but now at least you have someone with you who can help you push through those problems and move your cases forward.
Two years in, we pulled the data to see, "Okay, has this made a difference?" and what we discovered is that those six pilot districts had really hit it out of the park. So, we saw 114% increase in the number of traffickers charged in the pilots, compared with 12% in the rest of the country. In fact, those six districts had produced more convictions than the other 88 federal districts combined.
So we're like, "Okay, this is working", and that's slowly spreading in the US, but where it was not spreading was in developing countries, where 93% of the world's victims were, and that's what really motivated me to leave the Justice Department and launch the Human Trafficking Institute to really try to solve that problem, to take that successfully piloted model that we'd seen work well in the US to countries that had really good anti-trafficking laws, who were motivated to increase enforcement, even for self-interested reasons, and we can talk about that in a second; but just didn't have access to the model or the expertise to do it.
So, that's what we do now at Human Trafficking Institute. We now partner with developing countries, essentially to do those same three things. We help them vet and build specialised units, walk them through some very concrete skills training and strategy training, and then I hire former FBI Agents, former prosecutors, who move to that country, and by agreement with the government, begin to work directly with those units day in and day out on their cases, helping them build their skills, solve case-related challenges, and also create that transparency and accountability that helps protect against corruption risk; and then we measure that from start to finish to see if it's working.
Peter McCormack: That's quite a big move though, to go and create the Human Trafficking Institute. How did you even start? I mean, I guess one of the key issues is funding.
Victor Boutros: Yeah, I'm not going to lie, Peter, that was the big hang-up, because for a decade at the Justice Department, I had the IRS as my fundraiser, and they were really good at it. I mean, they raised our money without fail. I knew I had a travel budget at the Justice Department without fail. But leaving to launch the Human Trafficking Institute and having a bunch of friends who were government lawyers, or NGO people, I knew they weren't going to fund it. They were just trying to get food on the table, get their kids in school, and I didn't have a great network for that.
But at some point, my co-founder and I felt like we'd vetted this idea long enough. We know this is a huge need that honestly, even if governments are super-motivated to increase trafficking, they can shout down the chain of command to police and prosecutors and judges to get this fixed all they want. But if the police and prosecutors at the bottom of the chain are going, "This is actually quite specialised. We don't know how to do this", it's like putting $1 billion on the table and telling you or me to go cataract surgery.
At that point, it doesn't matter how smart we are or how well-motivated we are or how incentivised we are, we just don't have the skills to do it. We realised until you solve that problem, globally we can pour trillions of dollars into anti-trafficking efforts and see almost no reduction in the prevalence of trafficking. That's actually the one narrow thing that we know how to do, so let's take a risk and go do it. So, I left to try and raise some seed capital, and I was just profoundly bad at it, I discovered, judging by the results; and then we were just very fortunate to have one or two people that came through early on and took a massive risk on us that just gave us enough runway to really have things take off.
Peter McCormack: So, do you run it as a business or a non-profit?
Victor Boutros: It's a non-profit.
Peter McCormack: So, I mean it's a lot harder, I think, to raise for a non-profit than it is to raise for a technology company in Silicon Valley.
Victor Boutros: For sure. I remember sitting next to -- I was at a Conference -- the private equity guy who was sitting on my left and he said, "What do you do?" and I said, "I'd trying to raise the seed capital, here's what I'm trying to do". He's like, "What are you trying to do in year one?" I said, "We're trying to raise $1 million in the first year". He looked at me and he said, "You've got to rework this. That will never work. I produce amazing returns at my private equity firm; it's hard for me to raise $1 million. You're doing a philanthropic return; that's super-super-hard. Relying on the goodness of people's hearts to get $1 million is just a huge challenge".
So, it's actually been quite amazing to see that there are just a lot of people who I think, if you look at all the issues that we've talked about, there's almost always a vocal opposition. Often the debate is, "Should we or shouldn't we do this thing?" and I can't think of a social issue almost really right now where there's not a hot debate, except this! This is the one thing where there is no longer any debate about should we or shouldn't we stop this.
Peter McCormack: Right, "I'm pro-trafficking!"
Victor Boutros: Right. There's no pro-trafficking contingency that we don't want to offend. So, the debate has fundamentally shifted to, "Okay, well we all think this should stop, the question is can we and how?" And now, for the first time, we've got really proven models that are measurably stopping traffickers. And I think in my mind, going back to that divided soul kind of experience of one part of you is like, "This has to stop", and the other part is like, "It's too big, nothing will change"; what you really need, the thing that actually restores those two halves of your soul is this sense of very tangible hope. A is doable, B is doable, C is doable, and collectively they result in not just a few victims being protected, but massive drops in the prevalence of trafficking, and that really didn't exist when I wondered about this 20 years ago; but it does now.
So I think, especially for those of us with significant circles of influence, like you, I think this is an opportunity where we get to have a front-row seat, for the first time in history, to watching widespread human trafficking fall at scale, and to me that's a pretty exciting thing to be a part of.
Peter McCormack: And, my assumption is it's a problem that has been growing?
Victor Boutros: It's very hard to measure the growth of it, because it has been so hidden.
Peter McCormack: You don't know where it is, yeah.
Victor Boutros: Now, we do have numbers, so we know that roughly, there's 25 million victims today that are in some version of either sex or labour trafficking. Now, that's a cross-section number, because what happens is traffickers just churn through victims, so they acquire new victims, they discard old victims, and so the actual number of people victimised is way, way higher than that. But that number can feel so debilitating if you don't have tangible help, if there's not a very clear solution that can begin to address this at scale.
Peter McCormack: How long has the institute been running?
Victor Boutros: So, I left in 2015 to leave the Justice Department and get this launched.
Peter McCormack: Seven years.
Victor Boutros: So yeah, six or seven years.
Peter McCormack: So, how big's the operation now?
Victor Boutros: So, we have 22 folks globally, but we operate through -- so, just to give you one concrete example. One of our partner countries is Uganda. So, we work with the Government of Uganda, which commits to build not just a specialised unit, but an entire new human trafficking department within the police force that they commit to staff with 250 police and staff. And then, they allow us, by agreement, to operate inside that Criminal Justice system and drive cases forward through their own police and prosecutors.
That's really one of the reasons why we're able to see such outsized impact is, though our team is very small relative to impact numbers that we're seeing, we're operating through this much larger group of people who ultimately are going to own this. So, the goal is to ultimately create self-sustaining enforcement capacity, so that when these units can hit performance benchmarks and handle normal attrition, then Uganda is fully funding its own self-sustaining unit. So, you get all the ongoing protection, with no additional philanthropic investment.
Peter McCormack: And, do any of the governments actually financially contribute towards what you're doing; can you get funds from them?
Victor Boutros: In the first round, the commitment we've asked for our partners to do is to say, "You have to form these new units, and you've got to take your own people, assign them to these units, fund all their salary and all their benefits from day one, and you've got to find your own money to backfill the slots they've vacated by that transfer", which is actually quite a big ask for these poor countries, economically poor countries, "and then we'll take care of the rest".
Now, I think in five years, you could go to a country that is, for instance, there are countries right now who are on the precipice of getting sanctioned because of their human trafficking practices; and let's say they're looking at a $100 million sanctions risk. If we can help reduce that sanctions risk by 50%, that's a $50 million value proposition. So, I think you can begin to say, "Countries, it's actually more expensive for you not to solve the problem than to use this replicable model to solve it", and that's where you kind of start getting funding at scale. So right now, we're in this critical period over the next five or ten years, where proving out that this model actually works, not just in the US, but in these very different countries and continents and context, is critical data to help drive this to scale.
Peter McCormack: And is the impact that you can have globally and the scale of the impact you can have currently limited by your budget?
Victor Boutros: Yeah. I would say there's two limiting factors. The biggest is funding. And philanthropic funding is just much less efficient, capital distribution, right now than other forms of funding, which is honestly one of the reasons why it's pretty exciting to see, and I think this gets underplayed in the press, but to see the Bitcoin community becoming actually this dominant engine of philanthropy on the planet.
I mean, people think about the Bitcoin community outside of it as, "Oh, but isn't Bitcoin associated with crime?" and it has this negative reputation of being illicit or dark in some way. And yet, here you have all this Bitcoin wealth, and you have this community that's energised by building something that accomplishes something huge in a short period of time for the cause of human freedom.
So, I think about that grip and I think about here and now, we have this proven model that can actually dramatically increase the numbers of traffickers stopped and victims protected, and I think this is where I could imagine, in five years, what if the Bitcoin community actually became famous for being the driving force behind bringing human freedom to trafficking at scale across the globe.
I mean, as Bitcoin tries to gain broader adherence and more widespread adoption, hyperbitcoinisation I think depends on having a shift among the larger public that isn't getting to listen to your podcast, or is still a little bit on the fringes of, "What is this all about? It feels very different, it feels new, I'm not so sure about it. Isn't it associated with crime?" to see this is actually a group that's at the forefront of decimating something like modern slavery in a measurable way. That's the kind of thing that gets me excited.
When you look at the giving trends of the Bitcoin community, what's interesting is they're not like the traditional philanthropic community, they're not really interested in symphony tickets or the art. I mean, they're looking at, where are there game-changing impacts that if they were scaled, would have world-changing effects and have world-changing effects for human freedom. It's very interesting to read about that social movement that's really going underappreciated of Bitcoin driving the face of philanthropy in a totally different way.
Peter McCormack: How much work are you having to do to refill the funding each year; is it a constant cycle, or have you got regular funders? Even if you ran a fundraiser and, say you raised a number like, say, $5 million or $10 million, if that isn't consistently coming in, you don't want to scale and then have to reduce the size of the operation you're doing. I think repeat donors is going to be super-important to what you do.
Victor Boutros: For sure, recurring donors are very valuable to what we do, and we have experienced this really rapid growth. But our challenge honestly has been that we've seen even a much sharper growth in our impact; so, just let me give you a concrete example on this. So, in Uganda, they commit to build this unit. I hire a prosecutor actually from Texas who is a 13-year prosecutor, and he built the Human Trafficking Prosecution Unit just outside Houston. His wife and his three girls sell their house, they sell their cars and they move to Kampala, Uganda, to go and lead this work.
When he first started, I told him, "My goal in our first year is to see a 70% increase in the number of traffickers stopped through prosecution", and he looked at me like I had three heads. I mean he said, "Are you out of your mind? The US pilot on which this is based saw 114% increase over two years. 70% is greater than half of that, and that's what you're asking for in one year with basically just me versus the entire resource of the federal government; that's insane", and this is all pre-COVID. He said, "All right, I like a challenge, so we'll go in and we'll try". COVID hit and everything got harder.
But by the end of the year, we had seen a 304% increase in enforcement of the number of traffickers stopped. Now, over two years, it's a 538% increase over two years. I mean, when I was at DOJ and we saw 114% increase over two years, people were going crazy, like this is the gamechanger in trafficking. Now we're talking 538% increase with a much, much smaller investment of resources.
So, the awesome news about that is, I mean you're talking 70%, 75% of those victims were children. So, those children are now in places where they're starting to be cared for, and now you're talking about almost 1,000 traffickers that are behind bars that aren't going to do this again. We got our first ever life sentence of a trafficker a few months ago; tremendous movement that's happening.
The challenge now is, when you're talking about a 538% increase instead of a 70% increase, that means there's a lot more cases that need attention, and we have this huge organisational risk. I can't afford to burn out my lead prosecutor, or life happens and his parents get sick, or his wife's parents get sick and he has to come back to Texas for eight months; devastates our impact, and there's a huge advantage to keeping the pedal on the ground. Because, for traffickers, there's this flywheel effect that if you see a lot of enforcement barrelling down at you very, very quickly, seeing big sentences, it starts to feel like, "There's zero shot that I'm not going to get caught, and so I'm out. I'm shifting to voluntary labourers, I'm shifting industries. I'm out, it's too risky".
Driving that deterrent impact depends on speed, and that's where for us, we're looking at this, and if I were a for-profit company, I would say, "It's time to raise a Series B". We've got really unbelievable proof of concept, we benchmark this against the global per capita average, and so Western Europe and the Western Hemisphere, collectively they're about 1.7X the global average of human trafficking prosecutions. Not surprisingly, they had the most resources, the most expertise. Africa has about 0.9X the global average, lagging a little behind.
Uganda, before we should up, right at 0.9X, very average performer for Africa. After our embedded expert model, Uganda's now performing at almost 9X the global average. So, not only are they 9X the global average, they're almost 5X the high performers that we're seeing in the Western Hemisphere and Europe. So, we've got proof of concept, what we really need is growth capital, and that's just a less common concept in the non-profit philanthropic space.
But a community like this, a Bitcoin community, you probably have listeners right now who, within ten minutes, could change that. And that's the kind of thing that's quite exciting, is you build a revolution not from the old, crusted, philanthropic strategies of the past, but you have this global currency that is now looking to solve a global problem to bring global freedom, and that's pretty exciting to me.
Peter McCormack: There are billionaires who listen to this show, we know that factually! There are people with considerable wealth. There's always a lot of demand on it though. There are lots of problems in the world, and I agree with you, bitcoiners are very generous and if we can help support you with this, this would be great. What kind of a number's a gamechanger for you? You've essentially said you've achieved product market fit, you now want to scale. I've got no idea of the cost to run -- what's the cost now to run the operation of 22?
Victor Boutros: So, our entire organisation is operating on a $5 million budget.
Peter McCormack: Annual?
Victor Boutros: Annual, entire organisation.
Peter McCormack: What's a gamechanger for you; what kind of number, if someone came and said, "I can just give you this"?
Victor Boutros: I mean, $50 million really allows us to scale in a massive way. But even a $5 million growth capital allows us to scale up in Uganda, build that proof of concept out, so that you start to hit funding at scale. So, that's really the biggest limiting factor, is funding, and then building that pipeline of embeds to drive these things forward. So, that's what we're working on.
Peter McCormack: And you're not just prosecuting traffickers; my assumption is you're saving actual lives?
Victor Boutros: For sure, yeah.
Peter McCormack: I mean, you're physically saving lives, but you're saving people's future and mentally protecting them, you're protecting families. There must be other secondary effects of this as well.
Victor Boutros: Yeah, it's actually quite fascinating when you think about it, because many of us are already maybe philanthropically funding other really great efforts. So, you send money, for instance, just to Uganda to build great schools. There's literally a fantastic school in Uganda that's funded philanthropically. You have an amazing medical clinic and hospital over here, you have economic development and microenterprise over here.
What happens when all those incredibly important humanitarian initiatives are there and the people that are funding are there, and they can't actually reach the people that they're trying to serve, because those people are literally walled off from all that development and public health intervention by a trafficker, by a brothel wall; what do you do? Are you going to ask the hospital administrator to go and take on a trafficker, or a school administrator? You can't do that.
So, what we find is that trafficking begins to act as this bottleneck that chokes out the efficacy of these very, very important development and public health initiatives that are already in the very places where the trafficking victims are. So, if you can wedge open that bottleneck, there's already a lot of bandwidth there to meet those other needs, and that's one of the reasons why there's this massive study that the World Bank did a while back to look at, "What's the biggest driver of GDP?"
What they found is that the largest predictor of GDP value is Rule of Law Institutions. 57% of the intangible wealth which makes up the majority of GDP is driven actually by the effectiveness of Rule of Law Institutions. And when there's not that, when you have those broken public justice systems that aren't actually protecting people from crimes like trafficking, if you're not safe, nothing else matters. And yet, if we can actually wedge open that bottleneck, there's a lot of bandwidth there to address some of those other needs.
In that sense, it becomes an amplifier of these other investments that are too important to languish, because we haven't addressed the trafficking problem.
Peter McCormack: That's a highly relevant point to a lot of discussions we have, where we have a lot of libertarians who listen to the show, anarcho-capitalists, who believe that the centralised institutions have failed us and they're one of the primary problems within society. I disagree. I recognise there have been failings by governments, there have been failings by institutions, but this is an example of something which, if you don't have centralised forces working on it, is a problem that's hidden and a problem that I believe would grow. So, we fully support you. Are you already raising Bitcoin? Do you have a Bitcoin donation address on your website?
Victor Boutros: We do actually.
Peter McCormack: Okay, great.
Victor Boutros: I want to give actually a shoutout to Alex Holmes and OpenNode, who came alongside and made it really easy for us to launch and make it easy for bitcoiners to be engaged, and to do so incredibly generously. He's just so moved by the mission that he's really not making any money off this, I think, until there's $10 million of Bitcoin donations in the door.
Peter McCormack: Dude, I reckon you can twist his arm to never take it!
Victor Boutros: I imagine that's the case too. And honestly, if we had $10 million in Bitcoin donations after your show, that's a good problem to have!
Peter McCormack: Well, I mean you may do, you may not. There are people listening can do that in one hit; I wonder if they would. Have you got any idea how much you've raised so far with Bitcoin?
Victor Boutros: I don't know the exact numbers. We're right at the front end of that, so we'll be at the Bitcoin Conference, and then we're trying to engage with the Bitcoin community through podcasts like this and through other folks. And honestly, it seems like it's a kind of community where you could have a group of influencers that organically say, "This is going to be our deal. We're going to own this and figure out creative ways to harness this to drive this forward", and I think that would be awesome, I think that could be cool.
Peter McCormack: What's the water charity; Clean Water?
Victor Boutros: Charity: water.
Peter McCormack: Charity: water. Scott? I'm so bad with names; Scott Harrison? Yeah. He had a very clear objective. He said he wanted to raise a number. What was it? I think it was 50 Bitcoin, and I think the Winklevoss said they would match that.
Danny Knowles: They were matching everything up to that, I think.
Peter McCormack: Up to that?
Danny Knowles: I think so.
Peter McCormack: Or, didn't they say they would match it if it hit 50 Bitcoin?
Danny Knowles: That's right, they locked it up and would unlock it if it matched, I think.
Peter McCormack: I feel like if you had a number, I think that you could even record it on the website, it just felt like it was a goal you could put people towards.
Victor Boutros: That's a great idea, and I think we have some folks who might be open to kind of match like that as well, to really amplify the impact of it.
Peter McCormack: I mean, if you get 100 Bitcoin, that's $5 million-ish, $4.5 million. If you get 1,000 Bitcoin, that's $45 million. We will absolutely support you in this, we will donate, we will absolutely help you.
Victor Boutros: Thank you.
Peter McCormack: This is a super-important issue. I feel like if you made a campaign -- I'm just a marketing guy, right; I'm a marketing guy, I like marketing. And I feel like if you had a campaign that people could attach to, this might drive it forward.
Danny Knowles: Charity: water got that donation as well, they got there. They've raised over 100 Bitcoin now.
Peter McCormack: Over 100 Bitcoin? Incredible. What have I not asked you yet that I should have asked you, or that is part of this story that needs to be told?
Victor Boutros: The opportunity to see the scale of this happen, especially in the next several years, so that you have this demonstrated impact, that it can help unlock much, much larger scaling funding, is a really exciting thing for me, and hopefully this community. And I am encouraged by the fact that this community is focused in on, "How do we achieve high-yield impact through our philanthropy", and even learning about the tax advantages that exist for giving Bitcoin, especially in the US, that make it quite an efficient way to give as well, is kind of exciting and maybe underappreciated by the larger community opportunity to really make an impact through donations.
Peter McCormack: What kind of material exists if people want to read more? Have you made videos, films, articles; what exists?
Victor Boutros: So, the best resources are on our website, traffickinginstitute.org, and we do have little, short video clips, and explanations of how this works. And then there's an annual report that you can download where you can see, this is the sort of impact that we're seeing on the ground. And then, if you're interested in the US in particular, we have now, like I said, all these cases and trends mapped in the US. You can actually go to a map of the US and even look at your specific state and see, "How does my state stack up in how it's enforcing these laws?"
It's a great resource to see, "Hey, what's going on even locally for me in my own state?" as well as seeing the national trends that are happening. So, that's a great resource to go to.
Peter McCormack: You could make a good, short documentary about this to help people understand the issue as well; perhaps somebody going out to somewhere like Uganda and showing the impact of the work.
Victor Boutros: Yeah, that would be amazing. So, documentarians that are listening to this, reach out to me, I'd love to talk.
Peter McCormack: The only thing I didn't ask you, but I think is a relevant question, is there a negative Bitcoin side to this story? Is this something traffickers are using to fund their operations? Is it something we need to be aware of? I know it's a tricky question.
Victor Boutros: The answer is yes, we do see traffickers use Bitcoin, but we see them use it in a couple of different ways. We often see traffickers in the US that are using Bitcoin to post ads of victims on websites, where they advertise commercial sex. And then we see it used in purchasing child sexual abuse materials, or what sometimes used to be called child pornography.
Peter McCormack: Why has it been renamed?
Victor Boutros: I think the idea is that some people consume pornography, and just to add "child" before it maybe doesn't feel --
Peter McCormack: Minimises it, yeah.
Victor Boutros: Minimises it in some way, when really it's sexual abuse of children that's happening and being captured. I think that's the vision behind that shift in name. But that's where we see it too. And there was actually an amazing case that originated out of the IRS, who was looking at large-scale drug trafficking in Thailand, and came across really what is the largest dark web provider of child sex abuse material, and ended up shutting it down, resulting in over I think 300 arrests --
Peter McCormack: Oh, wow.
Victor Boutros: -- in I think 38 different countries. Foreign Policy did a story on it at the beginning of this year. And so, I think the good news is that Bitcoin is also being used, I think, as a tool by law enforcement to help identify cases in a sense that, if you have a cash exchange in a back alley, the only witnesses are the two people who are having the exchange. But in a sense, with blockchain, you have the entire globe serving as a witness. So, there are ways in which law enforcement can find Bitcoin as an effective tool to identify cases and pursue cases that they wouldn't otherwise get to do.
I think we should acknowledge that, yes it is true that Bitcoin is being used in crime; I think that does get overstated, especially when you hear senior government officials saying, "That's the primary use of Bitcoin, it's primarily used illicitly". I don't think the evidence supports that. But I do think the Government Accountability Office of the US Government did do a large-scale study that came out at the beginning of this year saying, "There is Bitcoin being used increasingly in human trafficking and drug trafficking".
So, I do think it's out there and it's just like any other tool; it can be used for good, or just like cash, it can be used for good or it can be used to exploit and cause harm. But I do think that the opportunity for bitcoiners to build the reputation of actually using their resources to oppose this kind of crime is a unique opportunity to really shift the way that the public sees all this.
Peter McCormack: Okay. Well look, we want to support you in what you're doing. Let's try, or you devise some way of making this a marketing thing. Some people won't like that, but marketing works. We will donate and support your cause and we will help promote it with the show, we can promote it on Twitter, on our email, we can get it out to everybody. But yeah, let's devise something and support you in doing this. Let's help you raise more money.
It feels like an amazing thing you're doing, and congratulations for how far you've got it so far. I definitely think it's something to celebrate, because you are changing people's lives which is incredible. Just remind everyone where to follow the work you're doing, and if people want to get in touch, how they get in touch with you.
Victor Boutros: Yeah, so you can follow us at traffickinginstitute.org, that's our website. And then, you can reach out to us by email, you can reach out to me personally at victor.boutros@traffickinginstitute.org, and would love to be in touch with folks.
Peter McCormack: Great, well we'll continue to support you and good luck with your work, it's incredible to hear, and appreciate you coming in to tell us what you've been doing.
Victor Boutros: Thanks, Peter.
