Somali pirates have offered something that no other pirate organization had in the history of naval conflict: reliability during negotiations.  The key to their business isn’t only in their seamanship where they are able to successfully board and capture valuable vessels, but that they cultivated relationships with hostage negotiators. While negotiating ransoms the abductees families could trust that if they sent ransom money that the pirates would honor the agreement and free the hostages and captured ship. With long term relationships with kidnapp and ransom insurance companies in place the pirates were able to reach out through the press and back channels to governments and military officials as well. In many areas of Somalia they have become the defacto rulers and most important employers.

In the absence of a regulated banking authority (since Black Hawk Down the international community has all but abandoned Somalia) many ransoms are paid in Somalia through hawala bank transfers that originate in London, Dubai and the United States. After hundreds of successful hijackings and ransom payments over the years the rules have become formalized to a point where everyone knows what to expect. Ransom negotiations will take several months, but the hostages and vessel will be treated well. The pirates even often hire cooks that specialize in providing western meals for hostages. It is in their best interest to be sure that the hostages are treated well. A death would ruin their reputation with the international community and cut their profits down the line. In return the pirates expect the navy to remain out of negotiations and to hold their fire. The minute a gun fires in anger on either side the entire system is vulnerable to collapse.

Right now insurance companies make rick calculations whereby they offset the cost of ransoms and injuries with premiums. They figure that if only .02% of vessels get hijacked, at an average cost of a few million per incident, then they can account for the expense with higher premiums.  At some point, though it all becomes unstable, uninsurable and the money sets the stage for violent conflict. As maritime ransoms have climbed over the years pirates have been able to reinvest and expand their business. Where ten years ago it was common to have vessels to pay only a $30,000 or $50,000 fior release, the New York Times notes that the average ransom has climbed to almost $4 million in 2011.  That sort of money buys a lot of rocket propelled grenades, skiffs and mercenary sailors. The result is a general ratcheting up of piracy throughout the gulf of Aden. As a security risk, naval fleets have a vested interest in preventing Somali piracy from growing so big that it outpaces the business plan.

In a way I understand the aggressive tactics by the navy. They want to deter piracy, and the only way to do that is to take the conversation out of the business realm and into the military one.  Now that they are shooting pirates we can expect the death toll to rise considerably in the future.  According to the New Y ork Times “The F.B.I. agent involved was a hostage negotiator from a special team based at Quantico, Va., who was experienced in both domestic and international hostage crises, a law enforcement official said Wednesday. It was unclear whether the agent had ever negotiated with Somali pirates.”[1]. This leads me to think that the negotiator here was not an old hand at Somali piracy and lacked any long-term contacts with pirage gangs.  He/she was using the rulebook that the FBI uses with terrorists, bank robbers and deranged lunatics, not business men.  Instead of offering up ransom, the agent offered the pirates a chance to escape with their lives. They could return the hostages and keep the boat. But no ransom would be paid.  It’s not the sort of thing that the pirates are used to hearing, and then, shortly thereafter the Navy took two pirate negotiators into custody—effectively holding them for ransom against the pirate crew on the yacht “Quest”.

It’s no shock at all that the event ended in the deaths of all of the crew and several of the pirates.  I don’t really buy the story that the navy put out that the pirates fired an RPG at the navy ship and provoked an armed response. It seems completely out of character for the out-gunned, out-classed pirates who were well aware of what would happen if they fired first. More likely, I believe that the navy is adopting new tactics to deal with piracy at the immediate expense of hostages. In the short term this will mean the deaths of captive crew members, but in the long run it may curtail some of the hijackings.  Unless of course, the pirates change their tactics to match the naval aggression.

If I were going to predict what will happen in the next five years, I believe that eventually pirates will stop holding individual crews at ransom, and change their tactics to show that they can also escalate their potential to do damage. They want to keep their business going, and the only way to do that is show the navy that attacking and killing pirates isn’t in their best interest. Several years ago Somali pirates captures the oil tanker the Sirius Star and it’s load of more than $100 million worth of light sweet crude.  If instead of holding the crew at gunpoint, they could have instead wired the vessel with explosives and threatened to sink it at grave environmental cost for fisheries, transit, and the coastlines of Jordan, Somalia, Kenya, Egypt, Pakistan, India and Saudi Arabia.  Leading to a new formula that I did not put in the original piece in Wired.

Violence deterrent = Naval response  /  potential damage cause by catastrophic pirate attack.

If they sink just one super tanker, the navy will relent just like the Americans did after the Black Hawk Down even in Mogadishu.  Although I hate to admit it, the pirates hold all the cards in this game.

Seemingly innocuous, it could have just been another order from Amazon.  But . . .

Lo and behold, it was a package full of galleys. Ten of them bound and ready for distribution to any media company interested in writing a review or booking a speaking engagement.

Galleys are interesting because the represent an intermediate stage in the publishing process between the final hard-cover product that hits the bookstores and the original draft that I submitted to my editor. They look and feel almost like a book at first glance. But on closer inspection the bindings are loose and the paper stock is pretty flimsy. The text itself is still riddled with small typographical errors, a few awkward sentences and some passages that will likely get cut once the Harper Collins legal team goes over it with a red pen. But they’re typeset more or less correctly and the interior illustrations come through well.

They serve one simple purpose: to drum up excitement for the book before the official launch on May 31st.  With a total run of about 150 copies the publicist at Harper Collins will send them out to reviewers and influential people who might be able to get other people interested in reading it once it comes out. Sure, they’re not getting a perfect first edition, but as a galley they get a sneak peek into what will hopefully be an interesting read. My agent has said that at this point they’re more precious than gold–probably not technically true. I’m more than willing to send you one in return for a couple ounces of gold–and I’m not supposed to send them out to friends and family. No, these are destined for a higher purpose. Most likely that means I’ll send all but one or two of them back to my agent so she can find the exact right folks.

The truth, of course, is that there is a large market for transplant organs in the United States but most of the operations are done abroad. Americans fly all over the world for kidney transplants, egg donations, surrogacy, adoptions and questionably legal surgeries. Hospitals in America generally do not preform the operations themselves; instead it’s usually American  brokers who connect patients with foreign surgeons and hospitals. Either way it’s still huge business. And once the article came out I immediately started getting e-mails from US patients on the kidney transplant lists asking me to put them in touch with hospitals and brokers who could arrange transplants for them on the cheap. (note to would be transplant patients: please don’t contact me for an organ hookup. I’m a journalist, not an organ broker.)

The infographic form is also not really able to convey why these markets exist in the first place. Red Markets are not simply a fact of life in the world, or a simple expression of supply and demand. Rather they exist because of lack of transparency in the legal supply chains for human tissue. There are very few cases where anyone will ever know who donated blood that saved their life in surgery, or what specific person gave up a kidney after their car accident. The identities of donors are screened behind a wall of patient confidentiality. While there are legitimate reasons to keep these things anonymous,that very lack of transparency provides great cover for an organ criminal to ply their trade. This is something that I go into much more detail in in my book–particularly the way that the crooked history of the blood business has shaped all modern red markets.

In the meanwhile, click on the pictures above to see the article online. Or even better, buy Wired’s underworld issue in print. It’s on newsstands for a few more days.

Over the years I’ve written on the complex politics, economics and social consequences of surrogacy, egg donation and international adoption. In that time I have generally avoided following the stories of customers of the baby-making industry. Instead, as you will read in my forthcoming book The Red Market (obligatory plug) looks primarily at the supply side. I’ve been particularly concerned with the way that donations of human materials (whether they is blood, kidneys, human eggs or adopted children) are sourced with a presumption of altruism, while simultaneously cloaking the identities of the donors behing a wall of privacy and anonymity. I’ve found many cases where those two things together provide cover for criminals and unethical doctors to cut corners and exploit their patients.

Some of my readers assume that because I have explored the unseemly elements of the red market that I am explicitly against all forms of tissue donation, adoption, and all other technologies that move human materials through the marketplace.  This is not true. In her quest to have children Thernstrom navigated the complex and murky waters of the fertility industry with a level of grace and forethought which is missing in most transactions on the red market. She wasn’t content to take different doctor’s word that her surrogate and egg donors were enlisting for the right reasons. In fact, she fired one donation agency when she didn’t like the way that they did business and ended up arranging for the donations in person.  She could be sure that no one was exploited because she took an active role in the supply chain from beginning to end.

It is easy to look at surrogacy or egg donation as simply an anonymous commercial transaction but Thernstrom managed to transcend the limitations of the marketplace and know what happened every step of the way. She negotiated contracts directly with the surrogate she hired and went over all of the potential issues that could arise point by point. She didn’t let a profit-taking middle man to take control of the transaction. Her article is a must-read for people looking for models when contemplating  their own fertility treatments.

Read Meet the Twiblings.

I had an hour long chat with Betty Jean King at FreeMeNow radio about my last four years of researching Red Markets which gets very good about ten minutes in.  And this morning I was joined by David Sher the CEO of Elite IVF and international fertility agent on NHPR’s afternoon program “Word of Mouth” for some point-counterpoint action.

It is fun to do radio again, although I have to say that it can be a bit surreal to be on the opposite end of the microphone. I’m used to being the interviewer, not the interviewee. It will be good practice for when the book comes out in June 2011.

In 2006 the Observer ran an article titled “The Cruel Cost of Human Eggs” about the growth of the Cypriot egg donation industry and the fear that certain clinics were endangering donors’ lives. As I found in my own research, the Observer had a difficult time getting directly in touch with egg donors, but was able to speak with women through intermediaries. One of those intermediaries seemed to make a connection between Cyprus’s brothels and fertility clinics, saying, “They work the cabarets, they’ll sleep with men, they’ll sell their eggs, and then they go back again.”

To its credit, the Observer article does not make the connection explicitly between sex work and egg donation, however that did not stop academics from connecting the dots on their own initiative. References to this quote and article appear liberally in almost a dozen academic texts including Heather Widdow’s “Border Disputes Across Bodies: Exploitation in Trafficking for Prostitution and Egg Sales for Stem Cell Research,” which builds its argument based on “the trafficked Eastern European prostitutes in Cyprus who also sell their eggs to the flourishing private network of in vitro fertilization (IVF) clinics there.”

An anthropologist I spoke to in New York had made her career deconstructing the connections between commerce and tissue donations and said that Cyprus was the smoking gun for human exploitation. In fact, she had just given a talk on the subject at Columbia.

I came to Cyprus almost positive that there was a direct link between sex trafficking and the fertility industry. The beach road in Limassol is dotted with cabarets and brothels where trafficked women are sold by the hour. The country is a repeat offender on the UN Department of State’s anti-trafficking TIPPS report that shows how the government here directly supports the trade in women. The government issues more than 300 special “artist” visas to cabaret workers and the local press is full of accounts of women tricked into working in brothels. The women are forced to pay back their plane tickets to brothel owners and have few rights in the eyes of the law. Along the way into the country they are first screened by doctors at the government hospitals, given a clean chit of health and set to work—a perfect opportunity for a fertility clinic to convince them to sell their eggs. After all, the profile of egg donors and prostitutes is fairly similar—young, beautiful women, mainly eastern European with an aura of fertility.

The facts on the ground, however, did not match the hype. After canvassing three brothels and speaking to sex workers and brothel owners, as well as the top ten anti-trafficking experts in Cyprus as well as two different sources who house and rescue trafficked women, no one had ever heard of anyone in a brothel selling their eggs. Father Savvas Michaelides, a Russian Orthodox priest, with a long flowing beard that is reminiscent of Santa Claus, has spent the better part of the last decade rescuing Russians from the brothels and says that more than 300 have come under his care.

After hearing about possible connections between egg donation and prostitution he frowns. “It seems like it could be possible, but I have never heard such a thing,” he says. His colleague Eleni Pissaridou who runs a shelter for trafficked women said that a study she had conducted last year with more than 100 interviews with sex workers never came across a single case of egg donation.

I asked David Sher, who runs Elite IVF, an egg donation agency, if it was even feasible to harvest eggs from Cypriot Cabarets. “It just wouldn’t make sense,” he said, “To undergo the procedure we need to be sure that the women aren’t having sex while undergoing hormone therapy. They’re very fertile at that time and might get pregnant. Neither the sex worker nor the IVF lab want that.”

For a journalist or academic working on the ethics of tissue donation and sales, a connection between prostitution and medical commerce is something of a holy grail. After all, if sex work is dangerous and exploitative by its very nature, then any related industry that depends on the same pool of workers is similarly corrupt. An academic can apply the same tools of analysis against egg selling as they do sex work.

In an e-mail to the sex industry magazine Spread, editor Will Rockwell said “it all sounds very seedy, as if as decent people we must believe that evil like this takes place, when you put the words “trafficking” and “eggs” together,” he wrote, but there are other reasons that might compel people to sell their flesh. “Young people in need of high-paid, mobile, and mostly unregulated work often turn to sex work the same as they turn to medical studies or egg-selling.”

Understanding that there is no clear link between human trafficking for sex work and egg trafficking makes this research all the more relevant. Egg selling, it turns out, has its own problems and origins that raise difficult questions about the motivations of egg sellers to approach fertility clinics.

Originally posted at the Pulitzer Center on Crisis Reporting.

While I was not able to speak directly with donors in Cyprus where the market is largely unregulated, I was able to locate numerous women in Spain. While in Barcelona, I contacted two women and one clinic worker who gave me an inside look at how clinics recruit and cultivate donor pools of primarily immigrant students who have few other opportunities to earn money legally in Spain.

“I was an immigrant working illegally. I had just arrived. I didn’t have permission to work from the government yet,” said Nicole Rodriguez who had emigrated from Chile. “It seemed like easy money.” But she had to learn the clinic’s language in order to receive the payment she was after. She said that she called the clinic and said “How much do you pay for eggs? So the woman corrected me saying ‘you mean for the donation of eggs,’ I said “excuse me excuse me, the donation of eggs’ Of course you are not supposed to call and ask how much they pay you. You are supposed to understand that this is only a detail.” The payment of 1000 euros fell within Spanish guidelines.

She signed a contract with the clinic renouncing her right to know about the children born to her eggs and went through two weeks of hormone injections to prepare the eggs for extraction. She went under general anesthesia for the actual procedure and woke up alone in a room with an envelope of cash next to her. “It was like they had thrown cash on a bed stand after seeing a prostitute,” she said.

A second woman, Kika, an immigrant from Argentina said that when she gave her eggs she was surprised to see a room full of other south Americans waiting to sell their eggs “They weren’t Spanish. They were immigrants for sure because I have a memory of thinking about this as an immigrant thing to do, like looking for a salida (a way out), a way to survive for money and this kind of thing.” But when she went through with the injections something went wrong. “All of the eggs they harvested were too big, the doctors called them super-eggs, and they decided to stop the treatment. They only paid me half the money they promised because they weren’t able to get the full batch.”

Claudia Sisti, a former patient assistant and international coordinator at the clinic Dexeus in Barcelona, said that these women’s experiences match what she saw after working in a clinic for two years. “Most of the donors were from Latin America, it was easy money for them,” she said. In the course of her every day interactions she knew of donors who tried to sell their eggs professionally “One Brazilian woman I knew sold her eggs four or five times in the course of a year and got sick. She was very thin, but they always accepted her into the programs.”

Spain performs well over 20,000 IVF cycles a year, and though regulations are far more strict here than in Cyprus, donors are almost universally recruited on the basis of the financial compensation, and are a necessary crutch for immigrant women who have few other options to legally make money.

“The technology is at a point now where we could basically FedEx you a baby,” he says as we sit at a swanky seaside hotel in Limassol. His network of hospitals connects patients all over the world to clinics in Cyprus, Mexico City, Tel Aviv, Romania and Canada. His staff of 14 oversees the connecting flights for patients and donors negotiating favorable rates with fertility clinics in different countries and locating egg donors and surrogate mothers for patients. “Donors are always in short supply, if someone wants to donate and they are qualified, you don’t want to let that go,” he says, adding that recently Elite has cut down on flying donors in because of logistical difficulties and quality control, where some egg donors were improperly prepared in clinics abroad. “In the past we had an aggressive program for bringing in donors from outside of Cyprus, from Russia and the whole Eastern European bloc. Patients prefer to come here because no one wants to go to Bucharest for IVF. All of the action is here.”

As nations around the world try to regulate fertility markets, Sher plays something of a spoiler, looking for loopholes between international regulations that allow paying customers to gain access to treatments that are too expensive or illegal in their home jurisdictions. According to a report released this year by the European Society of Human Reproduction and Embryology there are almost 25,000 IVF cycles preformed on fertility tourists every year in Europe alone. More than 50 percent of the people travel for fertility treatments in order to circumvent legal regulations in their home countries.

Elite-IVF follows a well established business model to divide labor and production costs across jurisdictions and keep prices low. The same way that a sneaker can be made in a Chinese factory for less, Elite IVF has removed the production of children from a discrete and sweaty encounter to something that takes place in a laboratories and wombs across the world. The results can be bewildering.

Take for example two of Sher’s most recent customers: Dr. Lavi Aron and his partner Omer Shatzky. They are an Israeli gay couple living in Tel Aviv who desperately wanted children but were confined by both biology and legal regulations that outlawed surrogacy. Through Elite-IVF they flew to Mexico City where they used the eggs of an Eastern European woman and created three fertilized embryos with both men’s sperm. They implanted the embryos into the womb of an American surrogate mother and the embryos developed into fraternal twins one girl, one boy—and one from each father. The surrogate then traveled back to the United States where surrogacy contracts are enforceable. The surrogate delivered twins (defacto American citizens) and then the new parents returned to Israel with their child.

When I ask him what he thinks the industry will look like in ten years, he sits back and muses on the possibility. He says that American parents are extremely particular about choosing the types of babies they want, from eye color, to genetic history, college background, attractiveness and SAT scores. “The future is designer babies.” Adding, “A former patient of mine, a man with more than 100 million dollars, said he wanted to start a farm for babies. Surrogates in Asia would carry the eggs of super donors from America—models with high-SAT scores who get paid $100,000 for their eggs. We would charge one million dollars per baby and sell them to his friends. My answer was a flat no. It’s just too strange. But there is a market for that. It is only a matter of time until someone does it.”

The website, which appeared in English, Spanish, Italian and Russian, beckoned foreign fertility tourists to buy eggs from women who are flown in specially for egg harvesting. Every month another crop of ten arrived for their stays’ at the clinic. The women were recruited through a network of fertility clinics and newspaper advertisements in the former Soviet bloc and offered about $500 for their eggs. The sum would have dwarfed their monthly income. Neither the donor nor the customer came from Cyprus; the island nation was simply used as a legal haven for an otherwise illegal transaction to take place.

The clinic, which is owned by the Chicago-based Reproductive Genetics Institute, Inc., has come under fire on several occasions for violating even the lax Cypriot medical guidelines. The allegations include operating a fertility clinic without a license, paying donors coercive sums, performing non-medically necessary sex selection, and tax evasion. For several years the Cypriot Ministry of Health has been running an investigation specifically targeting the Petra Clinic, however, ministry officials were unable to provide details.

I first heard about the Petra Health Clinic from local Cypriot doctors who believed that dangerous conditions on its site could lead to stricter regulation of all clinics on the island. An article that appeared in the Observer in 2006 claimed that egg donors were being routinely hyper-stimulated to produce more eggs and that batches of up to 60 were routine and split up between multiple recipients. Most doctors consider more than 14 eggs dangerous territory.

Embryologist Savvas Koundouros who works in a nearby clinic says that he has seen Ukrainian patients from the Petra clinic on death’s door, hospitalized in the capital city of Nicosia. “They get them sick and the ship them home so doctors in the Ukraine can deal with them,” he says.

I put off visiting the Petra Fertility Clinic for several days as I set about discovering more about the clinic’s international links. My first two attempts to arrange a meeting with the clinic’s director were rebuffed, saying that the clinic would not allow journalists after several “negative” interactions. Then, two days before showing up on their doorstep with a recorder and notepad, Oleg Verlinsky, CEO of RGI called me on my cell phone.

He told me that the Cyprus clinic only conducts egg transfers in rare cases of genetic disorders, and that the clinic’s primary focus is to treat the rare genetic blood disorder Thalassemia. When I pointed out that the Cyprus website does not even mention the word thalassemia anywhere in its over 260 pages of text, but devoted almost the entire site to egg donation and surrogacy he said that the website was in the midst of an update.

Eventually admitting that the clinic does conduct egg donations, I asked about the donors flown in from the Ukraine. “We have contracts with different centers in the world that have donors available. And it is easier to fly people from Ukraine to Cyprus than to Chicago. It is cost effective. It is just where the donors are and where they are available,” he said. When I asked if I could visit the clinic he denied my request, saying that donor confidentiality would be at risk if I showed up.

Two days later I drove a rented Toyota down the winding Cyprus coastal roads. As the deep blue Mediterranean sea jumped out behind palm trees and fish restaurants I was able to make out the dilapidated form of a granite house with signs in Greek and English that read “Preimplantation Genetic Diagnostic Centre”. Broken pots, dried leaves and clutter fill up the semi-circular driveway and a guard dog eyed me warily as I approached the wrought iron gate.

I knocked on the office door and was directed to meet Galina Ivanovina, the clinic’s Russian administrator who proceeded to contradict every statement made by her CEO just two days before. The clinic has only preformed 50 thalassemia treatments since its founding in 1996, and offers egg donation to foreign patients, mostly Israelis, Americans, Spaniards and Italians who come here because egg donation is legal and cheap. She said that the Ukrainian and Russian donors who fly in “do it for economic reasons, nothing else.” Indeed, to make extra money, the clinic will routinely splits batches between multiple customers.

Though she bristles against the allegations of over-harvesting “It is a lie about over-harvesting, we would never do that. No doctor would endanger patients’ health [for] that reason.”

The one case she admits about hyper-stimulation she says “was a shock and we sent her directly to a clinic in Nicosia for treatment.”

Flying donors across international boundaries to meet third-party recipients is a new innovation in tissue tourism, as it separates the payments and fallout the medical treatments across three different international jurisdictions. At best, it opens up a hole for questionable ethical practices, at worst it could put people’s lives in danger as doctors have every financial inventive to over-harvest and hyper-stimulate egg sellers.

Six months after I visited the clinic, police intercepted a group of Russian and Ukrainian egg donors at the airport and brought them in for questioning. Within days the Ministry of Health seized all of the frozen embryos at the Petra clinic and took hold of the clinic’s records. While no word on formal charges has yet come up, the clinic immediately took down its website and ceased all operations.

A white streak of scar tissue rips a path across Catalana Pislaru’s face, the undeniable mark of a violent past. “Yes,” she says, “many women sell their eggs here to make ends meet. We’re all vulnerable.”

The incongruity between the $10 cappuccinos we are sipping in the lobby of the Hilton in Cyprus’s capital of Nicosia and her story of being trafficked across borders to work in cabarets and for notorious underworld figures draws occasional furtive glances from the staff. At 15 she began dancing in cabarets in Greece and eventually was forced to move on to the sex clubs of Cyprus where her then-boyfriend beat her mercilessly and slashed deep wounds into her face. And yet with three children to take care of, she felt trapped in the relationship.

By 2007 she was pregnant with her fourth child and she knew that she had no option but to give it up. She arranged for a wealthy Cypriot family to adopt her child through a hospital in Nicosia and within minutes of his birth he was whisked away. She had barely any time to register that he had deep blue eyes. When the doctor returned without a child in hand, she says, that he started to take pity on her.

“He knew I was in a desperate position. No money, and no easy way to support my family.” So he offered her $2000 if she would agree to sell some of her ova once she had recovered from the pregnancy. She reasoned that the doctor knew that she was proven to be fertile, from his perspective she was a perfect candidate for donation.

Outraged by the offer and saddened by the loss of her child, she turned him down and went home to mourn her position. Others, though, she says, have not been so strong.

She takes out a small digital camera from her pocket and scrolls through several images until she settles on a picture of a dark-haired Russian woman holding an infant swaddled in a white cloth. It’s her friend Doylina, who she says is too afraid to speak with me.

The baby is less than a year old. And when he was born the hospital staff offered her 20,000 euros (about $30,000) to give up her child to a local family. Catalana convinced her not to take the offer, but instead she ended up on a regular regime of egg selling to support her family. Paid 1,500 euros every several months, she provides gametes to a variety of wealthy clients. The money, she says, is all that matters now.