The U.S. Congress enacted the Racketeer Influenced and Corrupt Organizations Act of 1970 (RICO) to deal with group crime, including organized crime, white-collar crime, violent groups, terrorism, and street gangs. RICO is the federal prosecutors’ tool of choice to deal with sophisticated forms of crime and an effective mechanism for prosecutors and crime victims to secure comprehensive civil relief. This article considers effective law enforcement for group crime, the elements of RICO, and RICO in use.
Effective Law Enforcement
Effective law enforcement requires substantive provisions, procedural provisions, administrative organizations, and personnel. Without these, the law will be ineffective in dealing with group crime. Statutes, too, are only one part of a criminal justice system. Without important provisions (e.g., dealing with process, statutes dealing with false testimony, witness protection programs), RICO legislation is not effective.
The provisions of most older criminal codes are inadequate to deal with group crime, whether organized crime (e.g., Mafia families or similar groups), white-collar crime (e.g., securities fraud, antitrust violations), violent crime groups (e.g., White hate, anti-Semitic), terrorism, or street gangs. Legislators envision a particular form of crime when they write criminal codes. Traditionally, they envision isolated offenders engaging in isolated criminal offenses. These offenses (e.g., murder, rape, robbery) usually occur on the streets of major metropolitan areas or within family dwellings. Most murders, for example, occur within a family or romantic relationship. They involve a limited number of people and are often crimes of insanity, passion, or behavior affected by the use of alcohol. In comparison, Mafia hits, for example, are done impersonally. Most rapes, however, occur between individuals who have some prior relationship, and rape committed by a stranger is less frequent. Most robberies occur in population centers on the street or in commercial establishments and are repeat offenses. Drafting a criminal code to address these offenses is exactly what traditional statutory drafters know well. Dealing with groups of criminals, however, requires drafting sophisticated laws.
Criminal groups present a challenge for law enforcement beyond traditional offenses or offenders. In fact, law enforcement has not been effective using traditional tools in dealing with criminal groups, such as the Mafia. Legislators did not design law enforcement agencies, prosecutor offices, criminal codes, criminal procedures, or rules of evidence with the Mafia in mind. If law enforcement is to successfully curtail such groups, they face formidable hurdles. They must obtain evidence of past offenses, even if witnesses are not available because of fear of retribution. Prosecutors must convict individual persons of specific offenses but must also consider the relationship between individual offenses and a possible group behind it and connect multiple individual offenses. Organized criminal groups commit ongoing offenses; they are also prone to commit cognate offenses. For example, an organized crime group might not only deal with illicit drugs but also commit murder or use other forms of violence to protect the drugs and proceeds and to monopolize the traffic area.
Law enforcement must understand the character of a group, the pattern of its offenses, and then seek to investigate and sanction them appropriately. All members of society need to see the scope of criminal offenses if the society understands them and how to protect itself from these sorts of behaviors through more effective law enforcement. The public has to support law enforcement if enforcement hopes to succeed. Law responds to the articulated wants of the public. Those wants should reflect the necessary knowledge it needs to formulate the goals of law enforcement, the means of law enforcement, and an evaluation of its successes, its failures, and the reasons behind both.
If criminal activities come before a court and a conviction results, the court should be authorized to impose severe sanctions, including long-term incarceration. Law enforcement has seldom succeeded in deterring these offenders from a life of crime or in their reformation when it captures offenders. Justice (defined in terms of deterrence, reformation, and isolation) is the collectively defined goal of law enforcement. Here, however, justice focuses more on reasonably measured incapacity for society’s protection. Generally, criminals lose their day-to-day vitality to engage in most forms of crime with the mere passage of time. In the experience of most knowledgeable enforcement practitioners (officials inside law enforcement and scholars outside of law enforcement who study it), this truism is not correct in the instance of organized crime. It stands out as an exception, and because of the inability of society to achieve the other goals of justice successfully, the emphasis has to turn to incapacity. In addition, legislatures must supplement imprisonment with fines and require the forfeiture of the instrumentalities and the proceeds of the offense (or substituted assets) to make the behavior ultimately unprofitable.
The Elements of RICO
In 1970, Congress enacted the Organized Crime Control Act. Title IX is the Racketeer Influenced and Corrupt Organizations Act, codified at 18 U.S.C. §§ 1961–1968 (2012) (hereinafter RICO).
In Section 1961, RICO sets out relevant definitions. Racketeering activity includes specified offenses of (a) violence, (b) the provision of illegal goods and services, (c) corruption in labor or management relations, (d) corruption in government, and (e) commercial and other forms of fraud by, through, or against various types of licit or illicit enterprises. The term person includes any individual or entity capable of holding an interest in property. Enterprise includes any individual, partnership, corporation, association, or other legal entity and any union or group of individuals associated in fact although not a legal entity. Pattern of racketeering requires that the pattern reflects continuity over time and a relationship between the various instances of the racketeering activity.
In Section 1962, RICO provides standards of unlawful (not criminal) conduct. A person who receives income from a pattern of racketeering activity cannot invest or use that income in an enterprise. A person cannot get or keep control of an enterprise by a pattern of racketeering. A person employed by, or associated with, an enterprise cannot conduct the affairs of the enterprise through a pattern of racketeering. Finally, a person cannot conspire to violate RICO.
Section 1963, sets out criminal sanctions, including fines, imprisonment, and forfeiture, for a violation of Section 1962. Criminal sanctions under Section 1963 require a criminal trial instituted by the government through a grand jury indictment as well as the testing of government proof by the standard of beyond a reasonable doubt.
Section 1964, sets out civil sanctions, including disgorgement of illicit proceeds, and treble damages for injury to business or property, for a violation of Section 1962. Civil remedies under Section 1964 require a civil trial instituted either by the government or a private plaintiff and the testing of either government or a private party proof by the standard of preponderance of the evidence.
RICO in Use
Understanding RICO requires examining more than a brief outline of the substantive law. Its legal use, too, is relevant. Behind RICO are three distinct theories: (1) theory of investigation, (2) theory of trial, and (3) theory of sanction.
As a theory of investigation, traditionally, criminal investigations started with a crime and moved toward an offender. RICO begins in that fashion, but it asks more broadly focused questions. What, if any, is the relation of this offense and offender to another offender and another offense? Do the offenses form part of a pattern? What, if any, is the relation of this offender to a criminal group (an enterprise)? Did the offense produce assets? Where are they? As a theory of investigation, RICO focuses on various relations of crime to crime, offender to offender, and crime and offender to an enterprise. These investigations also trace illicit assets to seize and forfeit them. In sum, it is a theory of investigating enterprise criminality.
As theory of trial, RICO focuses on the presentation of evidence to convict an individual offender. At the same time, it broadens the trial to view enterprise as the focal point of the trial. The enterprise may function as (a) a vehicle (actively used by offending perpetrator), (b) an instrument (passively used by others without its having culpability), through which the offender(s) engaged in a pattern of offenses, (c) the perpetrator(s) (the offenders together exploiting a victim), or (d) a prize against which the offender(s) directed the pattern of offenses. The trial also focuses on the use, gain, or investing of illicit assets. In sum, it is a theory of trying enterprise criminality.
As a theory of sanction, RICO seeks imprisonment and fine. However, because of the kind of offenders convicted and the scope of the conviction offense, it seeks just sentences that principally incapacitate and only secondarily deter. In sum, rehabilitation is not RICO’s main goal. Where rehabilitation occurs fortuitously, proper authorities may modify sentences. In addition to fines, RICO mandates the criminal forfeiture of any asset that the offender used to commit the RICO offense or which the offender gained by it. Finally, RICO authorizes civil remedies by the government for injunctions prohibiting further offenses by offenders, reforming enterprises, and disgorging illicit proceeds of the offense. In addition, RICO authorizes private civil suits to secure remedies for victims. Thus, it is also a theory of remedying (criminally, civilly, and by public and private suits) enterprise criminality.
Use in Fact
At first, the Department of Justice moved slowly to use RICO. Today, it is the prosecutor’s tool of choice against sophisticated forms of crime. The Department of Justice is also implementing RICO’s civil remedies against corrupt industries and unions. Since 1970, law enforcement has used criminal RICO against organized crime (including Mafia families), political corruption, white-collar crime, violent groups, and terrorist groups.
Studies conclude that RICO is effective in combating sophisticated forms of crime. In 1986, the President’s Commission on Organized Crime praised RICO and recommended that states adopt similar legislation. Indeed, 37 states as of 2013 have RICO-type legislation. The General Accounting Office in 1988, in its study of federal organized crime prosecutions, concluded that prior to RICO, attacking an organized criminal group was awkward. Those who designed the system of justice did not have organized crime in mind. RICO now facilitates the prosecution of criminal group members involved in superficially unrelated criminal ventures connected only at well-insulated upper levels of the organization’s bureaucracy. Before RICO, the government’s efforts were piecemeal, attacking isolated segments of the organization when they engaged in single crimes. When caught, leaders were only penalized for what appeared to be unimportant crimes. The larger meaning of these crimes was lost because the big picture was not presented in a single prosecution. The government now captures and presents the entire picture of the organization’s criminal behavior and its members’ and leaders’ involvement. The federal government did not bring criminal RICO prosecutions regularly until around 1975. Since 1975, roughly 125 prosecutions occur per year. Thirty-nine percent of RICO prosecutions occur in the organized crime area (not the Mafia alone but also for drugs, gambling, labor racketeering, among other ventures). Forty-eight percent of RICO prosecutions occur for white-collar crime (e.g., government corruption, general fraud in the private sector, securities fraud). Other categories, such as violent groups (e.g., terrorists, White-hate, anti-Semitic), constitute the remaining 13% of RICO prosecutions.
Although few would suggest that RICO is a statute without legal and other controversies, the statute’s two-track system of public and private enforcement (after a slow start) operates largely as Congress originally drafted it. Its impact on organized crime, in particular, on the Mafia, and white-collar crime has been substantial. Similarly, federal officials, as well as private parties, using criminal and civil sanctions, are working toward a more just society.
References:
- Blakey, G. R. (1986). Definition of Organized Crime in Statutes and Law Enforcement in President’s Commission on Organized Crime, Report to the President and the Attorney General, The Impact: Organized Crime Today 511.
- General Accounting Office, “Effectiveness of the Government’s Attack on Cosa Nostra,” in Organized Crime: 25 Years After Valachi: Hearings Before the Permanent Subcommittee on Investigations of the Senate Committee on Governmental Affairs, 100th Cong. 2d. Sess. 72 (1988, April 14).
- Gunnigle, J. (2006). “Birds of a feather” RICO: Trying partners in crime together. Syracuse Journal of International Law and Commerce, 34, 41.
- Permanent Subcommittee on Investigations of the Senate Committee on Governmental Affairs, Federal Government’s Use of the RICO Statute and Other Efforts Against Organized Crime, S. Rep. No. 407, 101st Cong. 2d Sess. 31–32 (1990).
- President’s Commission on Organized Crime, Report to the President and the Attorney General, The Impact: Organized Crime Today (1986). The Commission: [1986] Organized crime investigation United States. Organized crime United States. Note: Item 851-J-3 S/N 041-001-00309-6 Includes index. “April 1986.” Shipping list no.: 86-971-P. Washington, D.C.
- Rabb, S. (2005). Five families: The rise, decline and resurgence of America’s mafia empires. New York, NY: Thomas Dunne Books.