Racketeer Influenced Corrupt Organizations

IN THE UNITED STATES, the Racketeer Influenced Corrupt Organizations (RICO) statute is considered the most significant piece of legislation targeting organized and white-collar crime ever enacted. While derided in many circles as an unfair infringement on such ingrained constitutional rights as due process, it has been used extensively and successfully to prosecute thousands of individuals and organizations in the United States.

Part of the Organized Crime Control Act of 1970, RICO makes it unlawful to acquire, operate or receive income from an enterprise through a pattern of racketeering activity. Geared toward ongoing, organized criminal activities, the underlying tenet of RICO is to prove and prohibit a pattern of crimes conducted through an “enterprise,” which the statute defines as “any individual, partnership, corporation, association, or other legal entity, and any union or group of individuals associated in fact, although not a legal entity.”

Under RICO, it is a crime for an individual to belong to an “enterprise” that is involved in a pattern of racketeering, even if the racketeering was committed by other members. Specifically, Section 1962 of RICO prohibits “any person” from: a) using income received from a pattern of racketeering activity or from the collection of an unlawful debt to acquire an interest in an enterprise affecting interstate commerce; b) acquiring or maintaining through a pattern of racketeering activity or through collection of an unlawful debt an interest in an enterprise affecting interstate commerce; c) conducting or participating in the conduct of the affairs of an enterprise affecting interstate commerce through a pattern of racketeering activity or through collection of an unlawful debt; or d) conspiring to participate in any of these activities.

In order for an individual or organization to be convicted of racketeering under RICO, there must be proof of a “pattern” of illegal offenses, which RICO defines as the commission of at least two identified criminal offenses within a 10-year period. RICO defines racketeering in an extremely broad manner and includes many offenses that do not ordinarily violate federal statutes: “any act or threat involving murder, kidnapping, gambling, arson, robbery, bribery, extortion, or dealing in narcotic or other dangerous drugs, which is chargeable under state law and punishable by imprisonment for more than one year.”

In addition, RICO lists numerous federal offenses that the statute defines as racketeering: bribery, sports bribery, counterfeiting, embezzlement from union funds, loan sharking, mail fraud, wire fraud, obstruction of justice, contraband cigarettes, prostitution and trafficking in people, bankruptcy fraud, drug violations, and obscenity. As long as the “racketeering activity” is “chargeable” or “indictable” under an applicable criminal statute, the substantive RICO charge is available.

RICO creates offenses and penalties, above and beyond those proscribed for specific criminal offenses, for those involved in an ongoing illegal enterprise that engages in racketeering. The maximum criminal penalties for violating RICO include a $25,000 fine and imprisonment for 20 years.

These penalties are imposed on top of the criminal penalties resulting from two or more substantive offenses that the individual or organization has committed in the 10-year period. In addition to the criminal penalties, there are forfeiture provisions requiring the violators to forfeit any business or property derived from their illegal offenses.

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