In October 1970, the 91st United States Congress enacted the Racketeer Influenced and Corrupt Organizations (RICO) Act. It was primarily aimed at thwarting prominent crime families such as the Gambino and Bonanno families, but since its inception, RICO has been used in all kinds of cases relating to organized criminal enterprises.
While RICO began as a solely-federal statute, 33 states, the U.S. Virgin Islands and Puerto Rico have since adopted similar laws to combat racketeering. Thus, RICO cases are no longer limited to federal courts.
What does it take to charge people under RICO?
To convict a defendant of racketeering under RICO, prosecutors must prove that a defendant violated at least two predicate offenses covered by the statute within a ten-year period. Most of these predicate offenses are serious felonies by themselves. They include:
- Criminal copyright infringement
- Gambling offenses
- Drug trafficking
- Money laundering
This list is not exhaustive, but it demonstrates well the general idea. Since 1970, there have been some fascinating RICO cases, most of which did not involve traditional Italian crime families.
Famous RICO cases
The Montreal Expos and Major League Baseball
In July 2002, 14 Canadian companies accused Bud Selig, the MLB Commissioner, and Jeffrey Loria, the former owner of the Expos, of plotting to devalue the team for financial gain prior to its move to Washington. Neither man was criminally charged, but the RICO statute does contain a civil provision that allows parties injured by RICO violations to seek punitive damages. The case was eventually settled via arbitration, during which the MLB received a favorable ruling.
United States v. Scott W. Rothstein
In 2010, Scott Rothstein’s $1.2 billion ponzi scheme, the largest in Florida’s history, finally unraveled, and Rothstein was arrested on federal racketeering charges. The prosecution subsequently offered him an agreeable plea bargain in exchange for his cooperation in the investigation. Unfortunately for Rothstein, his greed and arrogance were boundless; the prosecution withdrew its offer after discovering that Rothstein lied to investigators and attempted to hide assets after agreeing to cooperate.
Rothstein has served about eight years of his 50-year sentence and was recently denied a sentence reduction in federal court. If forced to serve his full sentence, he won’t be released until he’s 90 years old.
The “Kids for Cash” Scandal
The notorious “Kids for Cash” Scandal occurred in Luzerne County, Pennsylvania in 2007 when a concerned parent contacted the Juvenile Law Center about sentencing irregularities in the county’s juvenile court. It was eventually discovered that two Luzerne County judges accepted approximately $2.5 million in kickbacks from two private juvenile detention centers in exchange for placing minor offenders in said facilities.
The scope of this scandal was unprecedented, involving more than 6,000 cases and 2,500 children. Judge Conahan received 17 years for his role in the scandal, and Judge Ciavarella, the more egregious of the two, received a sentence of 28 years in prison.
United States v. Kevin Eleby
While neither as sophisticated nor as well dressed as John Gotti, Kevin Eleby fits the textbook definition of a racketeer. In 2013, the former Los Angeles gang leader received a 25-year prison sentence after a federal court found him guilty of:
- Conspiracy to violate the RICO Act
- Drug trafficking (cocaine, heroin and crack cocaine)
- Possession with intent to deliver
- Firearm possession for the purpose of furthering a violent crime
The investigation into Eleby’s gang, the Pueblo Bishop Bloods, resulted in 45 federal indictments and 40 convictions.
Punishments for RICO violations
As illustrated in the cases above, punishments for RICO violations can be quite severe. Along with stiff prison terms, RICO convictions also usually involve punitive damages and the seizures of ill-gotten funds, assets and businesses. Because of their wealth and criminal reach, RICO defendants are also usually deemed flight risks, which often results in astronomical bail amounts or even remand.
Anyone facing charges relating to the RICO Act should talk to a criminal defense attorney immediately.