RICO stands for the Racketeer Influenced and Corrupt Organizations Act, a federal law passed by Congress in 1970, initially to fight the influence of organized crime (especially the Mafia) through a specialized statute that severely punishes defendants committing criminal acts that are part of a criminal organization. RICO was primarily aimed at the upper echelons of organized crime who traditionally were insulated from prosecution. The leaders of organized crime would give orders to their subordinates but would never personally commit crimes and with the Mafia's code of silence (Omerta) prosecution of the high-ranking leaders was next to impossible.

RICO provides harsh penalties for those persons who engage in a "pattern of criminal activity" on behalf of an organization, an "enterprise." A "pattern of criminal activity" is characterized by two or more specified state or federal crimes committed within a prescribed period of time. These crimes must be related to the "enterprise." An "enterprise" is broadly defined to include legal entities such as partnerships, corporations, associations and/or illicit entities or associations.

Under RICO, every method that allows for long-term racketeering activity by an enterprise is outlawed. If convicted for a crime of this nature, you could be looking at any one – or more – of the following penalties:

  • Fines
  • Prison sentence of up to 20 years per RICO violation
  • Forfeiture of any interest / claim / property or contractual right over the enterprise
  • Payment of "treble damages" to the civil plaintiff who seeks retribution (the amount of which could be three times the amount lost to the defendant)

RICO is part of the larger "Organized Crime Control Act of 1970," 18 United States Code Section 1961 to 1968, which was a comprehensive attack on the Mafia and other organized crime organizations of the time. Its use has considerably broadened since then because RICO focuses on "patterns of behavior," not just specific criminal acts. It is used nowadays to prosecute drug crimes, arson, money laundering, bribery, bankruptcy fraud, extortion, kidnapping, counterfeiting, insurance fraud, securities fraud, obstruction of justice, gambling and murder-for-hire. In fact, there are 35 requisite crimes that fall under the RICO Act, 27 federal crimes and 8 state crimes.

Broadly speaking, racketeering is the act of operating an illegal business or illegal services in order to make a profit.

As defined by federal law, racketeering can include:

  • Bribery
  • Counterfeiting
  • Felony theft from an interstate shipment
  • Embezzlement from pension and welfare funds
  • Fraud
  • Interfering with commerce
  • Money laundering
  • Murder for hire
  • Interstate transportation of stolen property

The RICO defendant and the enterprise are not necessarily the same. A person who is a member of an enterprise that has an effect upon interstate commerce and that has committed any two of the 35 prerequisite crimes in a 10 year period can be charged if there is any one of four specific relationships between the defendant and the illegal enterprise (i.e. "racket"): First, the defendant gained or maintained control or an interest over the enterprise through a pattern of racketeering, or second, the defendant placed the proceeds of the racketeering pattern into the enterprise; or, third, the defendant participated in or conducted the affairs of the enterprise through the pattern of racketeering activity, or fourth, the defendant conspired to do one of the activities listed above. An individual harmed by a racketeering activity can sue in civil court, where the damages are not capped.

The punishments for a RICO violation are harsh. Monetary damages can be trebled (i.e. three times the amount of actual damages) in either civil or criminal cases. Assets can be seized that were obtained through a pattern of racketeering. Each count of an indictment can result in 20 years in federal prison (which requires that 85% of the time sentenced must actually be served) and a fine of up to $250,000.00. A life sentence can be imposed if the underlying crime is punishable by a life sentence.

If you or someone you know is facing Federal RICO charges contact an experienced criminal defense attorney in Los Angeles to represent you in Federal court and learn about your legal options.

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