* Crisis hands opportunity to cash-rich mafia groups- UN
* Recession to swell ranks available to criminal gangs
* Need wider money laundering regulations
By Daniel Flynn and Antonella Cinelli
ROME, May 28 (Reuters) - The global economic crisis offers a chance for cash-rich crime cartels from Latin America to West Africa to extend their reach by buying assets from real estate to casinos, the top U.N. crimefighter warned on Thursday.
Antonio Maria Costa, executive director of the United Nations Office on Drugs and Crime (UNODC), said the deep recession would also swell the ranks of the unemployed willing to work for crime groups, and force many on the poverty line into the clutches of people traffickers or prostitution rings.
"Recessions and depressions have always produced that response: more people out of work, more migrants who have to find money, fewer remittances to poor countries, making more people available to become part of the problem," he told Reuters ahead of a G8 interior ministers meeting in Rome.
Costa said the credit crunch that rocked financial markets last year left mafia organisations in a powerful position and he called on ministers from the world's leading industrialised countries to take tough action.
"This crisis offers a unique opportunity for organised crime to penetrate the financial system," he said. "Banks are in difficulty because of the drying up of interbank lending ... organised crime groups are the only ones left holding large amounts of cash."
A multilateral Financial Action Task Force (FATF) formed in 1991 did much to help drive mafia money out of banks over the ensuing decade but that achievement was being undermined by the global haemorrhaging of legitimate credit.
Organised crime groups were sitting on a war-chest of cash estimated at $322 billion in 2005, Costa said.
He cited a raid on the Mexico City mansion of a suspected drug kingpin last year which had uncovered $206 million in bank notes crammed into cases and closets, thought to be the biggest cash seizure in history.
"The penetration of the system happens at many levels. A fight against money laundering only limited to financial transactions is not right, and there are certain sectors that are really vulnerable like real estate, the hotel industry, the gambling industry," he said.
A proposed overhaul of global financial regulations presented an ideal opportunity to revise money laundering laws, currently aimed only at the financial sector.
"My main concern ... is to make sure ministers understand that crime has become a systemic threat worldwide. We are talking about ... syndicates which have become a threat to security in a number of regions," he said, citing central America and West Africa as particularly at risk.