RICO Act
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| RICO Act | |
|---|---|
 U.S. Government · Public domain · source | |
| Name | RICO Act |
| Enacted | 1970 |
| Citation | 18 U.S.C. §§ 1961–1968 |
| Enacted by | 91st United States Congress |
| Signed by | Richard Nixon |
| Effective | 1970 |
| Purpose | Combat organized crime and racketeering |
RICO Act The Racketeer Influenced and Corrupt Organizations Act was enacted as part of the Organized Crime Control Act of 1970 to target long-term criminal enterprises and illicit networks. It created civil and criminal remedies to prosecute patterns of racketeering activity involving enterprises, enabling prosecutors and private parties to seek treble damages and criminal penalties. The statute has been used against a wide range of targets from traditional syndicates to corporations and political actors.
Background and Legislative History
Congress enacted the statute amid investigations into the influence of organized crime uncovered by Senate Special Committee to Investigate Crime in Interstate Commerce, hearings led by Senator John L. McClellan, and reports by figures such as Robert F. Kennedy. The law was drafted during the Nixon administration and incorporated recommendations from the Wickersham Commission-era reformers and anti-corruption advocates including staff from the Department of Justice and scholars influenced by cases like Kefauver Committee probes. The statute reflects legal responses to activities attributed to the American Mafia, Genovese crime family, Gambino crime family, Lucchese crime family, and federal investigations connected to operations in cities such as New York City, Chicago, Los Angeles, and Miami, Florida.
Provisions and Legal Standards
The statute defines "racketeering activity" through a list of predicate offenses including violations of statutes addressing mail fraud, wire fraud, securities fraud, bribery, obstruction of justice, money laundering, and specified state crimes. It requires proof of a "pattern"—generally at least two predicate acts within a ten-year period—and an "enterprise" distinct from the defendant, concepts interpreted by the Supreme Court of the United States in decisions such as United States v. Turkette and H.J. Inc. v. Northwestern Bell Telephone Co.. Mens rea standards, venue rules, statutory damages (including trebled civil damages), and asset forfeiture provisions derive from cross-referenced statutes and have been shaped by rulings in appellate circuits including the Second Circuit, Ninth Circuit, and D.C. Circuit.
Criminal and Civil Applications
Criminal enforcement enables indictment, trial, and sentencing for enterprise-based racketeering, often coupled with charges under statutes like 18 U.S.C. § 1956 (money laundering) and tax provisions prosecuted by the Internal Revenue Service Criminal Investigation Division. Civil RICO allows private plaintiffs—ranging from corporations such as Enron Corporation adversaries to individuals affected by schemes tied to Bernie Madoff-style fraud—to seek injunctive relief and treble damages in federal courts including the United States District Court for the Southern District of New York and the United States District Court for the Central District of California. Civil suits have targeted corporations like Microsoft in antitrust contexts, and unions such as Teamsters in corruption investigations, illustrating broad applicability beyond traditional organized crime.
Major Cases and Precedents
Key criminal and civil decisions shaped the statute’s scope: United States v. Turkette affirmed that legitimate and illegitimate enterprises could be prosecuted; Salinas v. United States addressed proof of intent and the "agreement" element; Reves v. Ernst & Young clarified RICO's "operation or management" requirement for enterprises; and H.J. Inc. v. Northwestern Bell Telephone Co. interpreted the "pattern" element. Major prosecutions include cases against the Chicago Outfit, trials involving figures like John Gotti, civil actions related to Enron scandal principals, and suits concerning political corruption linked to events such as the Abscam investigation. Appellate rulings from the United States Court of Appeals for the Seventh Circuit and Eleventh Circuit further refined doctrines on proximate cause, injury, and predicate act aggregation.
Enforcement and Prosecution Practices
Investigations often rely on wiretaps authorized under statutes such as the Omnibus Crime Control and Safe Streets Act of 1968, grand jury subpoenas, cooperation agreements with indicted witnesses (including use of plea bargaining and witness relocation), and asset forfeiture coordinated with agencies like the Federal Bureau of Investigation, Drug Enforcement Administration, and Department of Justice Antitrust Division. Prosecutors from U.S. Attorney’s Offices in districts including Southern District of New York, Northern District of Illinois, and Central District of California deploy RICO alongside state law enforcement and task forces such as the Organized Crime Drug Enforcement Task Forces. Defense strategies have tested evidentiary thresholds established in cases like Dowling v. United States and constitutional protections adjudicated in contexts involving the Sixth Amendment and Fourth Amendment jurisprudence.
Impact and Criticism
Advocates credit the statute with dismantling parts of the La Cosa Nostra, disrupting trafficking networks connected to Colombia and Mexico, and providing remedies for corporate fraud exposed in scandals such as WorldCom and Tyco International. Critics argue it can be overbroad, chilling legitimate business activities, and enabling high-stakes civil litigation that benefits contingency-fee plaintiffs and trial lawyers in forums like the United States Court of Appeals for the Second Circuit. Scholarly debate in journals at institutions such as Harvard Law School, Yale Law School, and Columbia Law School focuses on doctrines of aggregation, proximate cause, and statutory interpretation, with proposals for reform debated by policymakers in the United States Congress and commentators in outlets like The New York Times and legal treatises from practitioners in firms such as Skadden, Arps, Slate, Meagher & Flom.