Racketeering in Organized Crime: Key Elements and Impact

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What is Racketeering?

In organized crime, racketeering is a nefarious and intricate phenomenon that has plagued societies for decades. This article delves into the concept of racketeering, shedding light on its definition, historical context, essential elements, and its profound impact on various aspects of society.

What is Racketeering?

Racketeering is a systematic and illegal operation conducted by individuals or groups, commonly known as organized crime syndicates or criminal enterprises. It involves the planning, executing, and perpetuating of criminal activities to generate illicit profits and maintain control over specific territories or industries.

Traditionally, the word “racket” is used to describe a business that is based on the example of the “protection racket” and indicates that the speaker believes that the business is making money by selling a solution to a problem that the business itself created (or that it intentionally allows continuing to exist), precisely so that continuous purchases of the solution are always needed.

The Employers’ Association of Chicago initially coined the term in June 1927 in a statement about the influence of organized crime in the Teamsters Union.

Historical Context:

The roots of racketeering can be traced back to the early 20th century when organized crime syndicates, such as the American Mafia, gained significant prominence in the United States. These criminal organizations engaged in a wide range of illegal activities, including gambling, extortion, drug trafficking, prostitution, and money laundering.

Key Elements of Racketeering

  1. Criminal Enterprise: Racketeering typically involves the existence of a criminal enterprise—an organized group of individuals who collaborate to carry out illegal activities. These enterprises often have hierarchical structures, with top leaders overseeing and controlling various operations.
  2. A Pattern of Illegal Activities: Racketeering is characterized by repeated criminal acts carried out by the enterprise. These acts include extortion, bribery, fraud, smuggling, counterfeiting, and other illicit activities. The primary objective is to accumulate wealth and power through illegal means.
  3. Monopoly and Control: Racketeering often aims to establish a monopoly or control specific sectors, industries, or territories. This control is maintained through coercion, violence, and corruption, thereby eliminating competition and ensuring continuous revenue streams for the criminal enterprise.
  4. Money Laundering: Racketeering frequently involves money laundering to conceal the proceeds of criminal activities. This process facilitates the integration of illicit funds into the legitimate economy, making it difficult for authorities to trace and seize the illegally acquired assets.

Impact on Society

Racketeering has far-reaching consequences that extend beyond the realm of organized crime. Individuals, communities, and governments feel its detrimental effects in various ways:

  1. Economic Impact: Racketeering undermines legitimate businesses and hinders economic growth. Racketeering distorts market dynamics and siphons resources away from legitimate economic activities by monopolizing industries, engaging in corruption, and promoting illegal trade.
  2. Social Disruption: Racketeering perpetuates violence, fear, and social instability. Communities living under the influence of organized crime face higher rates of crime, reduced quality of life, and limited access to essential services. Criminal enterprises can undermine trust in institutions and erode the social fabric.
  3. Political Corruption: Racketeering often infiltrates political systems, resulting in corruption and the erosion of democratic processes. Criminal enterprises may bribe or coerce public officials, compromising the integrity of governance and enabling the expansion of criminal activities.
  4. Threat to National Security: Racketeering can significantly threaten national security. Criminal organizations involved in racketeering may engage in drug trafficking or arms smuggling, fueling violence, destabilizing regions, and undermining the rule of law.

Combating Racketeering

Governments and law enforcement agencies worldwide employ various strategies to combat racketeering. These include:

  1. Legislative Measures: Governments enact laws specifically targeting racketeering, such as the Racketeer Influenced and Corrupt Organizations (RICO) Act in the United States. These laws provide authorities with tools to investigate, prosecute, and dismantle criminal enterprises involved in racketeering.
  2. International Cooperation: Collaboration between countries is crucial to combat transnational racketeering. Sharing intelligence, coordinating investigations, and extraditing criminals help dismantle global criminal networks.
  3. Strengthening Law Enforcement: Governments invest in training, resources, and technology for law enforcement agencies to enhance their capacity to detect, investigate, and disrupt racketeering activities.
  4. Community Empowerment: Engaging communities and promoting social programs can help address the underlying socio-economic factors that contribute to the growth of organized crime. By empowering individuals and providing viable alternatives, communities can resist the influence of criminal enterprises.

The RICO Act

Racketeering is usually associated with organized crimes and criminal organizations and is generally punished under the RICO Act (Racketeering Influenced and Corrupt Organizations). The RICO Act allows law enforcement to prosecute all members of a crime organization instead of just going after a single individual. Law enforcement agencies use it to charge the mafia, cartels, street gangs, motorcycle gangs, and other organized crime units.

The RICO Act includes a list of 35 different crimes, including such things as:

  • Aiding/assisting illegal aliens entering the country for financial gain
  • Arson
  • Bankruptcy fraud
  • Bribery
  • Counterfeiting
  • Criminal copyright infringement
  • Dealing in obscene matter
  • Dealing with a controlled substance or listed chemical
  • Drug trafficking
  • Extortion
  • Gambling
  • Embezzlement
  • Fraud
  • Kidnapping
  • Money laundering
  • Murder
  • Murder-for-hire
  • Obstruction of justice
  • Racketeering
  • Robbery
  • Slavery
  • Securities fraud
  • Terrorism
  • Theft
  • Others

    Examples

    Protection Racket

    The best-known form is the “protection racket,” in which criminals demand money from businesses in exchange for the service of “protection” against crimes that the racketeers themselves instigate if unpaid. This is depicted in films like The Godfather, where mobsters “shakedown” local businesses for money.

    For example, a representative from an organized crime gang or family informs a store owner that a fee of a certain amount of dollars will be required every month to serve as protection money. However, the “protection” comes from the racket itself, not causing damage to the store or its employees. This practice is often seen in movies about the mafia and the mob.

    Numbers Racket

    This is a form of illegal lottery that is played in poor neighborhoods. In this situation, people pick three digits and place a bet, hoping to match random numbers drawn the next day. In recent years, the three-digit number is often taken from a number published in major NYC newspapers.

    Punishment for Racketeering Crimes

    Each count is punishable by up to 20 years in prison. In addition, the court can impose fines related to the number of the defendant’s profits from their crimes.

    Hire a Private Investigator to Investigate

    Private investigators may be hired to investigate various crimes related to racketeering. Detectives may go undercover to obtain proof or conduct surveillance to observe the behavior of specific individuals.

    Questions and More Information

    If you have any questions, please post a message below. For more legal definitions, visit our Glossary of Legal and Investigation Terms.

    Michael Kissiah is the owner of Brandy Lane Publishing, LLC, which owns and operates a small portfolio of websites, including eInvestigator.com. Michael created eInvestigator.com more than 20 years ago after working as a private investigator in the state of Florida. Since that time, he has become an expert at how to find information online and has written over 1000 articles on topics related to the investigation industry. In addition, he is the author of the "Private Investigator Licensing Handbook", available at Amazon.com.

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