The RICO Act of the United States

The United States RICO (Racketeer Influenced and Corruption Organizations) Act was originally introduced legislatively as a way to cut down on criminal organizations and American gangsters. The main purpose of this act was to lessen racketeering, as stated in its name. While the RICO Act started out historically as a specified purpose Act, for both the criminal and civil arena, over time it has morphed into an act applicable to organizations outside its original parameter structure. The current state of RICO has caused concern among civil liberty advocates and leaves the future of RICO largely unknown. If the current trajectory of RICO continues as it has, the likelihood of RICO continuing its infiltration into other sectors is high, creating even more ambiguity and room for interpretation.

From a historical perspective, RICO contained four premises for its creation to combat criminal law in 1970. “…(1) using income derived from a pattern of racketeering activity to acquire an interest in an enterprise; (2) acquiring or maintaining an interest in an enterprise through a pattern of racketeering activity; conducting the affairs of an enterprise through a pattern of racketeering activity; and (4) conspiring to commit any of these offenses” (Blakey and Gettings 1021-1022). Premise four is perhaps the most revolutionary addition to RICO because it creates the potential for indirectly related parties to be charged for crimes originally conducted through specific criminal and racketeering groups. The second part of RICO illustrates the civil sector.

Not only does RICO give the federal government the power to prosecute criminal organizations within the four parameters listed above, but individual citizens may also utilize the power of RICO in civil suits. “…any person injured in his business or property may bring a civil suit in federal court against the RICO offender” (Blakey and Gettings 1037). Since RICO’s implementation, both the civil and criminal applications of the law have expanded exponentially. In order to understand the major changes and expansion associated with RICO over time, an examination of the history is important.

The RICO Act’s history beings in 1970 with its adoption as part of the Organized Crime Control Act. In its infancy, RICO had a clear purpose: to fight the prevalence of organized crime, specifically organized crime engaged in racketeering (Blickensderfer 867). While the RICO Act came into existence in 1970, the government’s focus on organized crime as a significant issue began about 20 years prior through the Kefauver Committee and continued into the 1960s with the McClellan Committee. By the late 1960s, it was obvious the majority of organized crime was being perpetuated and funneled through the Mafia via unions. “The problem of organized criminal activity in the world of legitimate businesses and unions was, therefore, well-documented by 1967…and recommended the use of new approaches to control its infiltration into legitimate business” (Blakey and Gettings 1015). After the understanding of organized crime through unions was fully investigated, numerous Senate based bills were drafted to address the issue. However, it was not until 1969 that RICO like provisions were being discussed within the House and Senate. While the details of the bill containing RICO were somewhat contested between the House and Senate, October 12, 1970 marked the passage of Senate Bill 30 as well as the RICO Act. Three days later, President Nixon signed the bill, officially initiating the RICO Act. (Blakey and Gettings 1019-1021). Even though RICO had clear parameters upon its beginning as law, in its short history, RICO began to transform and was used in an expanded and vague manner.

The first 10 years of RICO’s history were, for the most part, on point with the original intention of the law. The government was successfully cracking down on organized crime, thanks to RICO’s ability to incorporate several crimes together for one trial. “The law allows federal prosecutors to stitch together crimes going back many years, from extortion and loan sharking to murder, in a single case. It is easier for them to convict mob defendants when they wrap in evidence of the broader context in which the crime was committed…” (Koppel, par 3). Essentially, RICO has been used as a shortcut to indict and put on trial, multiple organized criminal bodies, such as John Gotti and the Gambino family, for multiple crimes over a large span of time. However, the broad context RICO grants to prosecutors working for the federal government, has allowed the law to be applied beyond its original intention. Amendments throughout RICO’s history have also created other avenues for application.

Most amendments to RICO were relatively minimal, usually involving the addition of organized criminal activity to be recognized. The first amendment, introduced in 1978 added cigarette bootlegging as a recognizable offense through the RICO lens. A decade later, RICO added the predicate offenses of credit card fraud, the hiring of hitmen and the sexual exploitation of children to the list of organized crimes. The next several years brought more revisions, such as the recognition of bank fraud (Marine 7). While the premillennial additions were noteworthy changes, significant alterations to the RICO Act occurred after the year 2000, in conjunction with the United States Patriot Act.

The changes to RICO channeled through the Patriot Act are, feasibly, a big part of the reason why RICO began expanding beyond its original parameters. Tightened security on behalf of the government loosened the range of RICO’s application. Crucial changes came to Section 304 of RICO. “…which made any act that is indictable as a Federal terrorism offense a RICO predicate offense…the list of predicate federal offenses for RICO…includes none of the offenses which are most likely to be committed by terrorists. This section adds terrorism crimes to the list of RICO predicates so that RICO can be used more frequently…” (Marine 8). Throughout the next 10 years, further revisions were made which expanded the application of RICO through the federal government. As a result, courts interpreting the applicability of RICO have immense latitude regarding use:

Congress mandated a liberal construction of the RICO statute in order to effectuate its remedial purposes…thus the term enterprise includes commercial entities such as corporations (both foreign and domestic), partnerships, sole proprietorships, and cooperatives, benevolent and non-profit organizations such as union and union benefit funds, schools, and political associations. The term enterprise also includes governmental units such as the offices of governors, mayors, state and congressional legislators, courts and judicial offices, police departments and sheriffs’ offices, county prosecutors’ offices, tax bureaus, fire departments, and executive departments and agencies, as well as municipalities. (Marine 53-57).

As a reasonable conclusion, imagining the blanket potential of RICO is very easy. The RICO Act had its first abnormal applicability attempt with the Hell’s Angels motorcycle gang in the late 1970s. This set the stage, according to some experts, as RICO’s official application beyond its original intention. Under the broad definition of enterprise, it was believed RICO would be appropriate for use.

The Hell’s Angel's case, United States v. Barger began with the government’s attempt to convict Sonny Barger, leader of the Oakland subgroup for the Hell’s Angels motorcycle gang, in violation of RICO for perceived weapons and drug smuggling. However, since RICO had not yet seen a decade as law, the jury did not agree with the federal government’s pursuit of the Hell’s Angels under RICO. “The bikers were acquitted. With their long hair and tattoos, they didn’t look like an organized-crime enterprise…” (Koppel, par 6). While it is understandable to see how RICO could have applied to the Hell’s Angels, the social rights case Scheidler v. National Organization for Women regarding the rights of anti-abortion protestors is one of many examples of civil RICO expanding beyond its established guidelines.

Keeping in mind the original intention of RICO to apply within economically disturbed circumstances, Scheidler v. NOW presents a whole new scenario for the RICO Act. The case was decided in 1994 by the Supreme Court and is one of many examples where the RICO Act has been expanded in recent decades. “The Scheidler case began when abortion rights advocates sued numerous anti-abortion protestors…alleging antitrust and RICO violations” (Blickensderfer 868). While on the surface it would appear the plaintiffs had no foundation for their RICO invocation, the charges did fall within the parameters of civil RICO. “First, the plaintiffs alleged that the anti-abortion protestors violated section 1962(a) by using money derived from their racketeering activities to further their actions through an enterprise…” (Blickensderfer 868). Echoing the broad definition of enterprise, RICO could be interpreted to apply to the Scheidler case.

The additional two charges contained accusations from the plaintiffs that anti-abortion “enterprises” were running their organizations through some form of racketeering and that the actions were planned so as to imply organization since RICO’s initial purpose was to attack organized crime. While the charges presented are undoubtedly part of RICO’s territory for application, the contention lies in the court’s interpretation of whether or not the anti-abortion protestors were engaging in economically disturbing activities. In other words, even if the anti-abortion protestors could be classified as an enterprise, under the baseline workings of RICO, the disturbance would have to crossover into the economic arena for a decision to rest on the foundation of RICO.

In the first round of argument, the district court of Illinois heard the allegations from the plaintiffs and the rebuttal from the Pro-Life Action Network (PLAN) defense. “The court dismissed the plaintiffs’ primary RICO claim under section 1962(c) because it believed that RICO did not apply to the defendants, who were not motivated by financial considerations but by ideological concerns” (Blickensderfer 869). At this point, the lines for the application of RICO are largely contingent upon the perception of individual judges within the court system. The ability to distinguish between ideological and financial considerations are, at best, reached by subjective conclusions. Ascertaining whether or not an organizations’ views and actions are ideologically or financially based is the crux of the issue for the applicability of RICO. Attempting to determine the motivation is problematic however and creates the idea that ideological and financial motives are mutually exclusive. After losing to the district courts and appellate courts, the plaintiffs took their argument to the Supreme Court.

The Supreme Court, in a surprisingly united voice, reversed the district and appellate court’s decisions, and, even more shockingly, removed the original foundation of RICO’s initial intention of enterprises operating with economic motive. “Writing for a unanimous Court, Chief Justice William H. Rehnquist held that RICO requires no economic motivation…” (Blickensderfer 869). Rehnquist also referred to the broad definition of enterprise that Congress had established not long after the creation of RICO, further cementing the precedent for RICO to be applied loosely. From a certain point of view, it would appear RICO has been divorced from its original intention. Further, the arguments made by the plaintiffs rested mainly on a conspiratorial foundation. “At trial, NOW alleged that the activists were part of a nationwide conspiracy to close abortion clinics through a pattern of racketeering activity including extortion…” (Blumner 49). While the goal of most anti-abortion interest groups is to limit or altogether close abortion clinics, it is a huge leap to suggest racketeering as the mechanism behind it. Due to the broad interpretation, the court is forced to distinguish and separate ideological from financial motive and attempt to figure out if racketeering is the medium used to carry out these endeavors. The Scheidler case is one of many examples helping to illuminate the pivotal concern for the future of RICO: are civil liberties being compromised under its broad interpretation?

Since the RICO Act was drafted with a specific purpose, but worded with the potential to be far-reaching, there is substantial concern among civil liberty advocates regarding RICO’s perceived encroachment. The future of RICO is largely rooted in the present-day results of criminal and civil cases. If current trends remain, it can be expected for RICO to continue expanding and therefore applying to additional “enterprises.” RICO’s application has, in summation, become a powerful arm for the federal government:

The growth of the federal criminal code has come in the wake of attempts by politicians and federal bureaucrats to do something about perceived crime rates, to stop illegal drug use by Americans, and to punish individuals who engage in white-collar crime. In the process of expanding the federal role in identifying and prosecuting criminal behavior, however, the federal government has become a formidable conviction and imprisonment machine…much of the growth of federal criminal procedures has been tied to the expanded use of the Racketeer Influenced and Corrupt Organizations Act (RICO)… (Anderson and Jackson 86)

While the criminal side of RICO’s application is the matter of greatest concern, the civil side should not be ignored. The 1994 Supreme Court decision against anti-abortion advocates, described the power of individual or group citizenry efforts to concoct conspiratorial theories and label them under the long-range applicability of the RICO Act. Ultimately the broad-based foundation of RICO is the problem for the potential threat to civil liberties. With the economic requirement removed by the Supreme Court for RICO’s application, the Act’s ability to be used in expanding sectors of the country is virtually unlimited.

In fact, looking at RICO from the protection of the civil liberties perspective offers a point largely overlooked. “…the law was little more than a bait-and-switch statute that has had little or no effect in stopping or inhibiting the crimes…that most concerned the public in 1970. Instead, RICO has enabled federal prosecutors to circumvent the constitutional separation of powers between the national and state governments” (Anderson and Jackson 87). While it may be unfair to state explicitly that RICO, especially in its beginning, had little effect on reigning in organized crime, consideration should be applied to the idea of vast expansion as a tool for abused governmental power.

In the time period of its short existence, the RICO Act has been beneficial in severely limiting racketeering and other methods associated with organized crime. The criminal and civil components of RICO have allowed governmental and citizen-based efforts to reduce the prevalence of racketeering. Throughout the years however, RICO has expanded exponentially bordering on seemingly illogical applications. These changes have caused concern in the civil liberties arena, suggesting the future of RICO will be highly contested and closely watched. RICO will likely continue to be revised, reapplied and reexamined in the coming years.

Works Cited

Anderson, William J., and Candice E. Jackson. "Law as a Weapon: How RICO Subverts Liberty and the True Purpose of Law." The Independent Review 9.1 (2004): 85-97. The Independent Institute. The Independent Institute, 2004. Web. 15 Mar. 2014.

Blakey, Robert G., and Brian Gettings. "Racketeer Influenced and Corrupt Organizations (RICO): Basic Concepts - Criminal and Civil Remedies." Temple Law Quarterly (1980): 1010-048. Web. 15 Mar. 2014.

Blickensderfer, Matthew C. "Unleashing RICO." Harvard Journal of Law & Public Policy 17.3 (1994): 867-94. Academic Search Premier. Web. 15 Mar. 2014.

Blumner, Robyn. "RICO: Be Careful What You Wish For." Human Life Review 24.3 (1998): 48-50. Academic Search Premier. Web. 15 Mar. 2014.

Koppel, Nathan. "They Call It RICO, and It Is Sweeping." The Wall Street Journal. Dow Jones & Company, 20 Jan. 2011. Web. 17 Mar. 2014.

Marine, Frank J. "Criminal Rico: 18 U.S.C. 1961-1968 A Manual for Federal Prosecutors." N.p., Oct. 2009. Web. 15 Mar. 2014. <http://www.justice.gov/criminal/foia/docs/2009rico-manual.pdf>.