A person or group that engages in a "racket" may be guilty of racketeering, a form of organized crime. A criminal enterprise is a racket when the criminal in question devises a plan that leads to an unlawful source of revenue, such as gambling or fraud. A "racketeer" is a person or group that participates in an illegal activity known as a racket. Since the early 1920s, racketeering has frequently been linked to organized crime. This association dates back to the period.
The First Steps of Racketeering in the United States
Lucky Luciano, a prominent member of the Mafia who arrived in the United States from Sicily in 1906, is usually regarded as the "founder" of contemporary organized crime and is considered an immigrant from that region. Sicily is the birthplace of the Mafia, which was once a loose organization that was made up of families and tasked with defending the island from invasion from other countries. Luciano assembled young criminals in New York City to achieve control after winning brutal fights with elder mafia leaders, even though there existed criminal organizations in the United States before he did so. They were involved in various illegal activities, the most profitable of which was prostitution and alcohol smuggling. Luciano arranged for the criminals to be divided into five households, later referred to as "syndicates." In 1936, Luciano was taken into custody after some of the prostitutes testified against him in front of the prosecutors who were looking into him. From his cell in federal prison, Luciano provided assistance to the federal authorities during World War II. Even while incarcerated, he retained the leadership of the longshoremen's union. Following that, he was freed and transported to Italy, which is where he ultimately passed away.The Initial Activities
Prostitution and the number racket are two of the first instances of racketeering. Prostitution is another early example of racketeering. Another lucrative enterprise in the early days of organized crime was providing protection, in which members of the syndicate would commit crimes against, for instance, a local company. After that, they would give the company "protection" against more crimes of a similar nature in exchange for substantial sums of money. Other early forms of racketeering include abduction, drug trafficking, smuggling firearms, and forging currency.A Well-Known Instance of Racketeering
In 1989, Michael Milken was a central figure in an infamous racketeering case that occurred in the securities business. The Milken case is an illustration of a racketeering investigation that did not include the Mafia or a powerful organized crime boss. Bond researcher at Drexel Investment Bank, where Milken worked throughout his time there. He emerged as an important figure in the development of the junk bond market. Milken established himself as a major figure on Wall Street and was widely believed to have occasionally circumvented the restrictions of the Securities and Exchange Commission (SEC). As a direct consequence of this, he came under investigation by the SEC. After being identified by another defendant in a securities investigation, Milken was finally indicted on 98 counts of racketeering and fraud with claims of insider trading, securities fraud, and stock manipulation. These charges came about as a result of the inquiry. As part of the terms of his plea deal, he served time in jail and paid a fine; nevertheless, he is no longer incarcerated.The Act Known as RICO
In 1970, a law known as the Racketeer Influenced, and Corrupt Organizations Act (RICO) was enacted in an effort to eradicate organized crime. This law is also known as the Organized Crime Act of 1970. When seeking to bring charges against organized crime bosses, police enforcement was able to help prosecutors fix an issue because of federal law. They could bring charges against the member of the racket who was responsible for the crime, but they could not bring charges against the head of the criminal organization since they were not the ones who committed the crime. Following the passing of RICO, organized crime bosses became subject to prosecution and may be prosecuted for their crimes. Because of RICO, it is possible that the sources of money will be uncovered and that both criminal and civil fines may be levied as a result. The criminal penalties for racketeering can range from up to twenty years in jail to life in prison, depending on the racketeering conduct, and the civil liabilities are three times as high as those in instances that do not involve racketeering.The RICO Act was initially enacted with the intention of bringing down Mafia criminal lords
Prosecutors have discovered a variety of new applications for the RICO Act in the years that have passed since its adoption. RICO laws can be used to prosecute criminal gangs and drug smugglers, just as they have been used to prosecute organized crime bosses in the past. This is because RICO statutes apply to all levels of organized crime.Racketeering in the Institutional Setting
Another recent racketeering scandal occurred in the Atlanta public school system in the year 2009, and the case was brought before a judge in the year 2015. The No Child Left Behind Act was enacted under the presidency of George W. Bush, and it mandated that schools be held accountable for the academic performance of their students. Students' answers on standardized exams used to measure what they had learned during the school year were changed in 2009 by a group of Atlanta education administrators. This year's pupils were given a series of examinations to see how much they had learned in the previous year. While the school system had a history of generating pupils with low test scores, the group of school officials saw considerable gains in student achievement during 2009. Some persons were charged with racketeering and convicted of the crime after an extensive investigation.Extortion through Cyberspace
The examples of racketeering that are relevant now are considerably more intriguing. Racketeers can engage in cyber extortion by making financial demands or by threatening to destroy or take control of electronic data such as computer files. Take, for instance, the scenario in which a hacker breaks into your computer (perhaps by figuring out your password) and uses that access to either harm your data or utilize your data in some way that is damaging to you unless you pay them a significant amount of money. Fraud against credit card companies is yet another type of online extortion. Skimming devices for debit and credit cards are installed on petrol pumps by criminals in order to steal the data from the cards. Customers of gas stations frequently are unaware of the presence of skimmers at the stations they frequent. Human trafficking, bribery, wire fraud, identity theft, illicit gaming, and money laundering are some further instances of racketeering in the current day.The Racketeering Industry's Effects on the Economy
The damage that racketeering does to society is significant. According to an estimate made by the United Nations Office on Drugs and Crime in 2009, all types of organized crime collectively contribute approximately 1.5 percent of the gross domestic product (GDP) of the entire world, which is equivalent to around $870 billion per year. That amounts to around 7 percent of the total export of products throughout the world.