Racketeer Influenced and Corrupt Organizations Act

Citation: Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C. §§1961 et seq.

Background
Illegal gambling may trigger the application of the Racketeer Influenced and Corrupt Organizations Act (RICO) provisions. The Illegal Gambling Business Act, the Wire Act, the Travel Act, and any state gambling felony are all RICO predicate offenses, which expose offenders to imprisonment for not more than twenty (20) years and/or a fine of greater of not more than $250,000 (not more than $500,000 for an organization) or twice the gain or loss associated with the offense. An offender’s crime-tainted property may be confiscated, and he may be liable to his victims for triple damages and subject to other sanctions upon the petition of the government.

Elements of a RICO
RICO makes it a federal crime for any person to:
 * 1. conduct or participate, directly or indirectly, in the conduct of
 * 2. the affairs of an enterprise
 * 3. engaged in or the activities of which affect, interstate or foreign commerce
 * 4. A. through the collection of an unlawful debt, or
 * B. through a pattern of racketeering activity, defined to include:
 * i. any act of gambling which is chargeable under State law and punishable by imprisonment or more than 1 year;
 * ii. any act which is indictable under 18 U.S.C. §1084 (Wire Act);
 * iii. any act which is indictable under 18 U.S.C. §1952 (Travel Act);
 * iv. any act which is indictable under 18 U.S.C. §1955 (Illegal Gambling Business Act).

“To establish the elements of a substantive RICO offense, the government must prove (1) that an enterprise existed; (2) that the enterprise affected interstate or foreign commerce; (3) that the defendant associated with the enterprise; (4) that the defendant participated, directly or indirectly, in the conduct of the affairs of the enterprise; and (5) that the defendant participated in the enterprise through a pattern of racketeering activity by committing at least two racketeering (predicate) acts.

The “person” who commits a RICO offense need not be a human being, but may be “any individual or entity capable of holding a legal or beneficial interest in property.” The “enterprise” element is defined with comparable breadth, embracing “any individual, partnership, corporation, association, or other legal entity, and any union or group of individuals associated in fact although not a legal entity.” In spite of their sweeping scope, the elements are distinct and a single defendant may not be simultaneously charged as both the “person” and the “enterprise” under 18 U.S.C. §1962(c). Subject to this limitation, however, a RICO enterprise may be formal or informal, legal or illegal. In order for a group associated in fact to constitute a RICO enterprise, it must be characterized by “an ongoing organization. . . and. . . evidence that [its] various associates function as a continuing unit.”

The “interstate commerce” element of the RICO offense may be established either by evidence that the enterprise has conducted its affairs in interstate commerce or foreign commerce or has engaged in activities that affect interstate commerce or foreign commerce.

The “pattern of racketeering activity” element demands the commission of at least two predicate offenses, which must be of sufficient relationship and continuity to be described as a “pattern.” Related crimes, for pattern purposes, are marked by “the same or similar purposes, results, participants, victims, or methods of commission, or otherwise are interrelated by distinguishing characteristics and are not isolated events.”

The “continuity” of predicate offenses may be shown in two ways, either by prove of the regular occurrences related misconduct over a period of time in the past (closed ended) or by evidence of circumstances suggesting that if not stopped by authorities they would have continued in the future (open ended). The courts have been reluctant to find the continuity required for a RICO pattern for closed ended enterprises (those with no threat of future predicate offenses) unless the enterprise’s activities spanned a fairly long period of time. Open-ended continuity (found where there is a threat of future predicate offenses) is nowhere near as time sensitive and is often found where the predicates consist of murder, drug dealing or other law-ignoring crimes or is part of the enterprise’s regular way of doing business.

Accomplice and Conspiracy Liability
The RICO conspiracy and accomplice branches of the law are notable for at least two reasons. RICO conspiracies are outlawed in a subsection of Section 1962, that imposes no overt act requirement. The crime is complete upon the agreement to commit a RICO offense. Second, at least in some circuits, RICO accomplices are not subject to RICO tort liability.