Racket (crime)
Encyclopedia
A racket is an illegal business, usually run as part of organized crime
. Engaging in a racket is called racketeering.
Several forms of racket exist. The best-known 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 (see extortion
). A second well known example is the numbers racket
, a form of illegal lottery
.
Traditionally, the word racket is used to describe a business (or syndicate) that is based on the example of the protection racket and indicates a belief that it is engaged in the sale of a solution to a problem that the institution itself creates or perpetuates, with the specific intent to engender continual patronage. One example is computer spyware
that pretends to be detecting infections and offers to download a cleaning utility for a fee, being itself distributed by the maker of the cleaning utility.
In the example of a protection racket, the racketeer informs a store-owner that a substantial monthly fee will be required in exchange for protection. The concurrent "protection" provided takes the form of the absence of damage inflicted upon the store or its employees by the racket itself.
The term "racketeering" was coined by the Employers' Association of Chicago
in June 1927 in a statement about the influence of organized crime in the Teamsters
union.
law. The RICO Act allowed law enforcement to charge a person or group of people with racketeering, defined as committing multiple violations of certain varieties within a ten-year period. The purpose of the RICO Act was stated as "the elimination of the infiltration of organized crime and racketeering into legitimate organizations operating in interstate commerce". S.Rep. No. 617, 91st Cong., 1st Sess. 76 (1968). However, the statute is sufficiently broad to encompass illegal activities relating to any enterprise affecting interstate or foreign commerce
.
Section 1961(10) of Title 18 provides that the Attorney General of the United States may designate any department or agency to conduct investigations authorized by the RICO statute and such department or agency may use the investigative provisions of the statute or the investigative power of such department or agency otherwise conferred by law. Absent a specific designation by the Attorney General, jurisdiction to conduct investigations for violations of 18 U.S.C. § 1962 lies with the agency having jurisdiction over the violations constituting the pattern of racketeering activity listed in 18 U.S.C. § 1961.
In the U.S., civil racketeering laws are also used in federal and state courts. The National Federation of Independent Business
challenged these civil laws in 2006 for being excessively abusive.
Law enforcement and other administrative organizations in the United States:
Other:
Organized crime
Organized crime or criminal organizations are transnational, national, or local groupings of highly centralized enterprises run by criminals for the purpose of engaging in illegal activity, most commonly for monetary profit. Some criminal organizations, such as terrorist organizations, are...
. Engaging in a racket is called racketeering.
Several forms of racket exist. The best-known is the protection racket
Protection racket
A protection racket is an extortion scheme whereby a criminal group or individual coerces a victim to pay money, supposedly for protection services against violence or property damage. Racketeers coerce reticent potential victims into buying "protection" by demonstrating what will happen if they...
, in which criminals demand money from businesses in exchange for the service of "protection" against crimes that the racketeers themselves instigate if unpaid (see extortion
Extortion
Extortion is a criminal offence which occurs when a person unlawfully obtains either money, property or services from a person, entity, or institution, through coercion. Refraining from doing harm is sometimes euphemistically called protection. Extortion is commonly practiced by organized crime...
). A second well known example is the numbers racket
Numbers game
Numbers game, also known as a numbers racket, policy racket or Italian lottery, is an illegal lottery played mostly in poor neighborhoods in the United States, wherein a bettor attempts to pick three digits to match those that will be randomly drawn the following day...
, a form of illegal lottery
Lottery
A lottery is a form of gambling which involves the drawing of lots for a prize.Lottery is outlawed by some governments, while others endorse it to the extent of organizing a national or state lottery. It is common to find some degree of regulation of lottery by governments...
.
Traditionally, the word racket is used to describe a business (or syndicate) that is based on the example of the protection racket and indicates a belief that it is engaged in the sale of a solution to a problem that the institution itself creates or perpetuates, with the specific intent to engender continual patronage. One example is computer spyware
Spyware
Spyware is a type of malware that can be installed on computers, and which collects small pieces of information about users without their knowledge. The presence of spyware is typically hidden from the user, and can be difficult to detect. Typically, spyware is secretly installed on the user's...
that pretends to be detecting infections and offers to download a cleaning utility for a fee, being itself distributed by the maker of the cleaning utility.
In the example of a protection racket, the racketeer informs a store-owner that a substantial monthly fee will be required in exchange for protection. The concurrent "protection" provided takes the form of the absence of damage inflicted upon the store or its employees by the racket itself.
The term "racketeering" was coined by the Employers' Association of Chicago
Employers' Association of Greater Chicago
The Employers' Association of Greater Chicago was a nonprofit association of employers based in Chicago, Illinois. It was founded as the Employers' Association of Chicago in 1903, although it was also known colloquially as the Chicago Employers' Association...
in June 1927 in a statement about the influence of organized crime in the Teamsters
Teamsters
The International Brotherhood of Teamsters is a labor union in the United States and Canada. Formed in 1903 by the merger of several local and regional locals of teamsters, the union now represents a diverse membership of blue-collar and professional workers in both the public and private sectors....
union.
The RICO Act
On October 15, 1970, the Racketeer Influenced and Corrupt Organizations Act (18 U.S.C. §§ 1961–1968), commonly referred to as the "RICO Act", became United StatesUnited States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
law. The RICO Act allowed law enforcement to charge a person or group of people with racketeering, defined as committing multiple violations of certain varieties within a ten-year period. The purpose of the RICO Act was stated as "the elimination of the infiltration of organized crime and racketeering into legitimate organizations operating in interstate commerce". S.Rep. No. 617, 91st Cong., 1st Sess. 76 (1968). However, the statute is sufficiently broad to encompass illegal activities relating to any enterprise affecting interstate or foreign commerce
Commerce
While business refers to the value-creating activities of an organization for profit, commerce means the whole system of an economy that constitutes an environment for business. The system includes legal, economic, political, social, cultural, and technological systems that are in operation in any...
.
Section 1961(10) of Title 18 provides that the Attorney General of the United States may designate any department or agency to conduct investigations authorized by the RICO statute and such department or agency may use the investigative provisions of the statute or the investigative power of such department or agency otherwise conferred by law. Absent a specific designation by the Attorney General, jurisdiction to conduct investigations for violations of 18 U.S.C. § 1962 lies with the agency having jurisdiction over the violations constituting the pattern of racketeering activity listed in 18 U.S.C. § 1961.
In the U.S., civil racketeering laws are also used in federal and state courts. The National Federation of Independent Business
National Federation of Independent Business
The National Federation of Independent Business is a lobbying organization with its headquarters in Nashville, Tennessee and offices in Washington, D.C. USA, and in all 50 state capitals...
challenged these civil laws in 2006 for being excessively abusive.
See also
Alleged criminal organizations:- American MafiaAmerican MafiaThe American Mafia , is an Italian-American criminal society. Much like the Sicilian Mafia, the American Mafia has no formal name and is a secret criminal society. Its members usually refer to it as Cosa Nostra or by its English translation "our thing"...
- CamorraCamorraThe Camorra is a Mafia-type criminal organization, or secret society, originating in the region of Campania and its capital Naples in Italy. It is one of the oldest and largest criminal organizations in Italy, dating to the 18th century.-Background:...
- Chechen mafiaChechen mafiaThe Chechen mafia is one of the largest organized crime groups operating in the former Soviet Union next to established Russian mafia gangs, which originally consisted of criminals of Chechen ethnicity who later also tried to recruit former Russian special military forces, police and army officers...
- Dixie MafiaDixie MafiaThe Dixie Mafia is a criminal organization based in Biloxi, Mississippi, and operated primarily in the Southern United States, in the 1970s. The group uses each member's talents in various crime categories to help move stolen merchandise, illegal alcohol, and illegal drugs...
- Irish mobIrish MobThe Irish Mob is one of the oldest organized crime groups in the United States, in existence since the early 19th century. Originating in Irish American street gangs of the 19th century — depicted in Herbert Asbury's 1928 book The Gangs of New York — the Irish Mob has appeared in most...
- MafiaMafiaThe Mafia is a criminal syndicate that emerged in the mid-nineteenth century in Sicily, Italy. It is a loose association of criminal groups that share a common organizational structure and code of conduct, and whose common enterprise is protection racketeering...
- 'Ndrangheta
- Russian mafiaRussian MafiaThe Russian Mafia is a name applied to organized crime syndicates in Russia and Ukraine. The mafia in various countries take the name of the country, as for example the Ukrainian mafia....
- Sacra Corona UnitaSacra corona unitaSacra Corona Unita, or United Sacred Crown, is a Mafia-like criminal organization from Apulia region in Southern Italy, and is especially active in the areas of Brindisi, Lecce and Taranto .-Background and activities:...
- Triad (underground societies)
- YakuzaYakuza, also known as , are members of traditional organized crime syndicates in Japan. The Japanese police, and media by request of the police, call them bōryokudan , literally "violence group", while the yakuza call themselves "ninkyō dantai" , "chivalrous organizations". The yakuza are notoriously...
Law enforcement and other administrative organizations in the United States:
- Bureau of Alcohol, Tobacco, Firearms and ExplosivesBureau of Alcohol, Tobacco, Firearms and ExplosivesThe Bureau of Alcohol, Tobacco, Firearms and Explosives is a federal law enforcement organization within the United States Department of Justice...
- Drug Enforcement AdministrationDrug Enforcement AdministrationThe Drug Enforcement Administration is a federal law enforcement agency under the United States Department of Justice, tasked with combating drug smuggling and use within the United States...
- Federal Air Marshal ServiceFederal Air Marshal ServiceThe Federal Air Marshal Service is a United States federal law enforcement agency under the supervision of the Transportation Security Administration of the United States Department of Homeland Security...
- Federal Bureau of InvestigationFederal Bureau of InvestigationThe Federal Bureau of Investigation is an agency of the United States Department of Justice that serves as both a federal criminal investigative body and an internal intelligence agency . The FBI has investigative jurisdiction over violations of more than 200 categories of federal crime...
- Internal Revenue ServiceInternal Revenue ServiceThe Internal Revenue Service is the revenue service of the United States federal government. The agency is a bureau of the Department of the Treasury, and is under the immediate direction of the Commissioner of Internal Revenue...
- United States Border PatrolUnited States Border PatrolThe United States Border Patrol is a federal law enforcement agency within U.S. Customs and Border Protection , a component of the Department of Homeland Security . It is an agency in the Department of Homeland Security that enforces laws and regulations for the admission of foreign-born persons to...
- U.S. Immigration and Customs EnforcementU.S. Immigration and Customs EnforcementU.S. Immigration and Customs Enforcement is a federal law enforcement agency under the United States Department of Homeland Security , responsible for identifying, investigating, and dismantling vulnerabilities regarding the nation's border, economic, transportation, and infrastructure security...
- U.S. Securities and Exchange Commission
- United States Marshals ServiceUnited States Marshals ServiceThe United States Marshals Service is a United States federal law enforcement agency within the United States Department of Justice . The office of U.S. Marshal is the oldest federal law enforcement office in the United States; it was created by the Judiciary Act of 1789...
- United States Postal Inspection ServiceUnited States Postal Inspection ServiceThe United States Postal Inspection Service is the law enforcement arm of the United States Postal Service. Its jurisdiction is defined as "crimes that may adversely affect or fraudulently use the U.S...
- United States Secret ServiceUnited States Secret ServiceThe United States Secret Service is a United States federal law enforcement agency that is part of the United States Department of Homeland Security. The sworn members are divided among the Special Agents and the Uniformed Division. Until March 1, 2003, the Service was part of the United States...
Other:
- Arms trafficking
- Drug cartelDrug cartelDrug cartels are criminal organizations developed with the primary purpose of promoting and controlling drug trafficking operations. They range from loosely managed agreements among various drug traffickers to formalized commercial enterprises. The term was applied when the largest trafficking...
- Organized crimeOrganized crimeOrganized crime or criminal organizations are transnational, national, or local groupings of highly centralized enterprises run by criminals for the purpose of engaging in illegal activity, most commonly for monetary profit. Some criminal organizations, such as terrorist organizations, are...
- Organized retail crimeOrganized retail crimeOrganized retail crime refers to professional shoplifting, cargo theft, retail crime rings and other organized crime occurring in retail environments. One person acting alone is not considered an example of organized retail crime. The FBI has estimated that the losses attributed to organized...
- Racketeer Influenced and Corrupt Organizations ActRacketeer Influenced and Corrupt Organizations ActThe Racketeer Influenced and Corrupt Organizations Act, commonly referred to as the RICO Act or simply RICO, is a United States federal law that provides for extended criminal penalties and a civil cause of action for acts performed as part of an ongoing criminal organization...
- Rum-runningRum-runningRum-running, also known as bootlegging, is the illegal business of transporting alcoholic beverages where such transportation is forbidden by law...
- TerrorismTerrorismTerrorism is the systematic use of terror, especially as a means of coercion. In the international community, however, terrorism has no universally agreed, legally binding, criminal law definition...
- Underground economyUnderground economyA black market or underground economy is a market in goods or services which operates outside the formal one supported by established state power. Typically the totality of such activity is referred to with the definite article as a complement to the official economies, by market for such goods and...