Racketeering encompasses criminal activities, often centered around extortion, and profits generated through illegal organized schemes, commonly referred to as “rackets.” The term “racketeering” is predominantly associated with unlawful patterns outlined in the federal Racketeer Influenced and Corrupt Organizations Act (RICO) and state versions of that law.
The spectrum of racketeering activity spans a wide array of crimes, including but not limited to gambling, extortion, drug trafficking, murder for hire, assault, and money laundering. It involves committing, conspiring, or facilitating specific offenses, and coercing or intimidating others into participation.
Racketeering originally got its name in 1927 from the Employers’ Association of Chicago. It defined a “racket” as a business that creates its own demand–something that would not be needed otherwise, such as the classic “protection racket,” in which gangsters coerce payment from business owners to keep their businesses safe from crime.
Cyber extortion occurs when a cybercriminal installs malicious software on a user’s computer, effectively barring them access to the system and all data. Subsequently, the attacker demands a ransom in exchange for restoring access.
A protection racket is a scheme of organized crimes involving a criminal group that threatens businesses or individuals with harm or damage unless they pay a fee for protection. These schemes exploit fear and vulnerability to extort money from victims by falsely claiming to provide security when in fact they are thinly disguised threats of harm.
Kidnapping is considered racketeering when an individual is unlawfully abducted, and the wrongdoer demands a ransom for their release. This criminal activity involves exploiting victims for financial gain and is often associated with organized crime networks.
A fencing racket involves brokers who buy stolen goods at low prices and sell them at a profit to unsuspecting buyers. This illegal activity fuels the theft cycle and undermines lawful commerce, posing a significant threat to community safety and security.
Drug trafficking involves the illegal production, smuggling, and sale of drugs to the public, including transportation and distribution to consumers.
Illegal gambling activities occur in venues such as underground casinos, sportsbooks, or card rooms where the “house” earns profits by taking a percentage of the bets. These operations sidestep legal regulations and taxes, endangering participants and bolstering organized crime networks.
Another type of racketeering involves an owner or employee of a contracting company collaborating to commit visa fraud or foreign labor contracting fraud for financial gain. They may force farm laborers into working for low wages by taking away their passports and isolating them from external contact.
Money laundering is an illegal practice that involves disguising the proceeds of criminal activities, such as drug trafficking, to make it appear as though they were obtained from legitimate sources.
The Department of Justice outlines the criteria for federal RICO charges. According to the DOJ (Department of Justice), to be found guilty of violating the RICO statute, the government must prove beyond a reasonable doubt that:
The RICO Act empowers law enforcement officials to charge entire criminal organizations, enabling prosecutors to seize assets and disrupt illicit financial activities. This statute empowers authorities to combat organized crime by allowing prosecution for up to 20 years of continuous criminal activity per racketeering count. Furthermore, it holds group leaders accountable for crimes they order others to commit.
Federal RICO crimes can be prosecuted at both the state and federal level. State laws against racketeering are investigated and prosecuted by state and local law enforcement and can also be applied to activities that do not affect commerce across state lines.
Conviction of a single crime under RICO carries severe penalties, including up to 20 years in prison, a fine of $250,000, and an additional fine equivalent to twice the profits from the crimes.
Additionally, the RICO Act incorporates a different provision for property forfeiture. Upon conviction for a RICO offense, the defendant must surrender any money or property obtained from the crime and any financial interest in the organization that benefited. This provision aims to punish the individual and also weaken the entire criminal organization, deterring future illegal activities.
Racketeering refers to criminal activities, often characterized by extortion and profits gained from illegal organized schemes, commonly known as "rackets." The term “racketeering” is primarily linked with illegal activity patterns outlined in the federal Racketeer Influenced and Corrupt Organizations (RICO) Act and state versions of that law.
The RICO Act is indeed effective in combating racketeering crimes nationwide. It empowers law enforcement to prosecute entire criminal enterprises, allowing for asset seizure and disruption of illegal financial operations.
Yes, racketeering is a federal crime. It encompasses offenses like extortion, money laundering, bribery, drug trafficking, and gambling, all prosecuted under federal law as part of racketeering crimes. Racketeering crimes can also be prosecuted under state law.
If convicted of a RICO offense, the penalties can be severe, including up to 20 years in prison and a fine of $250,000 for each crime.