Monster Media 1993 #2/Image.iso/text/crimftr1.zip/CRIMEFTR.008

Text File | 1993-06-14 | 24KB | 441 lines

         Racketeering Influenced Corrupt Organizations (RICO) Law

Title 18 USCS 1961 et seq, Racketeering Influenced Corrupt Organization
(RICO) law covers just about all criminal acts that are profit-oriented and
are repetitious. ("Proof of a "pattern of racketeering activity" defined by
this law [Title 18: 1961 et seq] requires showing at least two separate
instances of "racketeering activity.")

When you can, use RICO for prosecution of lawbreakers. It has advantages
that other laws may not have, such as the very wide range of fines and
forfeitures possible, including confiscating the "fruits of criminal
activity" from those convicted of racketeering offenses.

"Racketeering" used to mean any business of related criminal activity
operated like a business, such as those often operated by the Mafia. It has
now been expanded by most state laws to include any felony violation that
involves money as the motive and the offenses are repetitious in nature.
Examples are: robbery, bribery, fraud (cons and scams), and other felonies
where victims lose their money or valuable possessions. The exception
being personal crimes not committed for profit: homicide, rape, auto theft
for joyriding, poaching, arson, and other crimes which do not by themselves
 have financial gain as the primary motive. If there's a profit involved in
a felony, RICO laws (criminal and/or civil) can probably be used to take
all of the accumulated profit away from the lawbreaker. Your reward(s) are
a negotiated percentage of the fines and forfeitures.

                                  The Law

                     Title 18 USCS 1962 (Racketeering)

"Prohibited Activities

(a) It shall be unlawful for any person who has received any income
derived, directly or indirectly, from a pattern of racketeering activity or
through collection of an unlawful debt in which such person has partici-
pated as a principal within the meaning of section 2, title 18, United
States Code (18 USCS Section 2), to use or invest, directly or indirectly,
any part of such income, or the proceeds of such income, in acquisition of
any interest in, or the establishment or operations of, any enterprise
which it engages in, or the activities of which affect, interstate or
foreign commerce. A purchase of securities on the open market for purposes
of investment, and without the intention of controlling or participating in
the control of the issuer, or of assisting another to do so, shall not be
unlawful under this subsection if the securities of the issuer held by the
purchaser, the members of his immediate family, and his other accomplices
in any pattern or racketeering activity or the collection of an unlawful
debt after such purchase do not amount in the aggregate to one percent of
the outstanding securities of any one class, and do not confer, either in
law or in fact, the power to elect one or more directors of the issuer.

(b) It shall be unlawful for any person through a pattern of racketeering
activity or through collection of unlawful debt to acquire or maintain,
directly or indirectly, any interest in or control of any enterprise which
is engaged in, or the activities of which may affect, interstate or foreign
commerce.

(c) It shall be unlawful for any person employed by or associated with any
enterprise engaged in, or the activities of which affect, interstate or
foreign commerce, to conduct or participate, directly or indirectly, in the
conduct of such enterprise's affairs through  a pattern of racketeering
activity or collection of unlawful debt.

(d) It shall be unlawful for any person to conspire to violate any of the
provisions or subsections (a), (b), or (c) of this section."

                  Title 18 USCS 1963  Criminal Penalties

(a) Whoever violates any provision of section 1962 of this chapter (18 USCS
1962 et seq.) shall be fined not more than $25,000 or imprisoned not more
than 20 years, or both, and shall forfeit to the United States (1) any
interest he has acquired or maintained in violation of section 1962 and (2)
any interest in, security of, claim against, or property or contractual
right of any kind affording a source of influence over, any enterprise
which he has established, operated, controlled, conducted or participated
in the conduct of, in violation of section 1962.

(b) In any action brought by the United States under this section, the
district courts of the United States shall have jurisdiction to enter such
restraining orders or prohibitions, or to take such other actions,
including, but not limited to, the acceptance of satisfactory performance
bonds, in connection with any property or other interest subject to
forfeiture under this section, as it shall deem proper.

(c) Upon conviction of a person under this section, the court shall
authorize the Attorney General to seize all property or other interest
declared forfeited under this section upon such terms and conditions as the
court shall deem proper. If a property right or other interest is not
exercisable or transferable for value by the United States, it shall
expire, and shall not revert to the convicted person. All provisions of law
relating to the disposition of property, or the proceeds from the sale
thereof, or the remission or mitigation of forfeitures for violation of the
customs laws, and the compromise of claims and the award of compensation to
informers in respect of such forfeitures shall apply to forfeitures
incurred, or alleged to have been incurred, under the provisions of this
section, insofar as applicable and not inconsistent with the provisions
hereof. Such duties as respect to the disposition of property under the
customs laws shall be performed under this chapter by the Attorney General.
The United States shall dispose of all such property as soon as commer-
cially feasible, making due provisions for the rights of innocent persons."
                                * * * * * *

RICO law doesn't provide a stated reward for information "leading to the
conviction", but the above clause "and the award of compensation to
informers ..." implies that rewards are available and can be negotiated.
The important thing is, there's no upper limit restriction. Your percentage
can be up to 50% of the forfeitures, as it is in many other laws. It
depends on the information you provide, personal involvement and risk, and
the amount of control you have of the case. Control is the most important!

When fines and forfeitures are available, a percentage (usually 50%) is
awarded to the person providing essential information, and the remainder or
other half is paid to the law enforcement agency who made the arrest and
prosecuted the case.

Law enforcement agencies compete with each other like football teams. Each
agency wants the credit for the prosecution as well as 50 percent of the
fines and forfeitures. That's why they usually don't share information with
each other, which is detrimental to law enforcement generally. The flip
side is, when you have control, you are in a good position to negotiate
rewards. Each major law enforcement agency will want the case. If they
agree to 50% of forfeitures plus federal rewards, they still get the other
50 percent of the forfeitures. If they are too tight-fisted, they get
nothing! They know that. Always ask for 50 percent of forfeitures, plus
maximum rewards. Give it to the highest bidder. That's businesslike.

                              RICO Civil Suits

RICO civil suits are mentioned in "The Litigation Explosion", The obscure
mail and wire fraud statute can be included when defendants use national
advertising to encourage use of their product. That includes the big
players with deep pockets and liability insurance.

CrimeFighters can legally demand access to personal and business financial
records of the defendant to determine his financial status. The unlimited
access to personal and business financial records often makes reluctant
defendants cave in and want to settle out of court. That means you don't
have to hunt or dig for the information. You can, under civil suits, simply
demand it from the defendant.

When can you use RICO? The answer is mentioned in Olson's book:
"According to an A.B.A. (American Bar Association) study, more than 90
percent of the targets of civil-RICO lawsuits have no connection whatsoever
with organized crime. Nearly half of RICO suits rely solely on mail or wire
fraud charges, and another third rely on at least primarily on securities
fraud charges. By now, lawyers have deployed civil RICO in divorces, will
contests, and landlord-tenant disputes; against abortion protesters and
others demonstrating on the streets for their political beliefs; and of
course, in countless straight money suits over commercial disagreements."

                                State Laws

Most state RICO laws may be listed under the heading of organized crime and
fraud. Most state RICO laws now include all felonies primarily motivated
for financial gain. As an example, Arizona's RICO laws list a few defini-
tions of racketeering. I'll mention a few of them because they apply to
other states that have similar RICO laws. The wording might be slightly
different from state to state but the intent and definitions are the same.

Arizona's Definitions

"Extortionate extension of credit" means any extension of credit [lending
money] with respect to which it is the understanding of the creditor and
the debtor at the time such extension is made that delay in making repay-
ment or failure to make repayment could result in the use of violence or
other criminal means to cause harm to the person, reputation or property
of any person. [loansharking]

"Traffic" means to sell, transfer, distribute, dispense or otherwise
dispose of stolen property to another person, or to buy, receive, possess
or obtain control of stolen property, with intent to sell, transfer,
distribute, dispense or otherwise dispose of to another person.
[trafficking in stolen property]

"Criminal syndicate" means any combination of persons or enterprises
engaging, or having the purpose of engaging, on a continuing basis, in the
conduct which violates any one or more provisions of any felony statute of
this state. Drug dealing networks are included.

"Combination" means persons who collaborate in carrying on or furthering
the activities or purposes of a criminal syndicate even though such persons
may not know each other's identity or membership in the combination changes
from time to time or one or more members may stand in a wholesaler-retailer
or other arm's length relationship with others as to activities or dealings
between or among themselves in an illicit operation.

"Enterprise" means any corporation, partnership, association, labor union,
or other legal entity or any group of persons associated in fact although
not a legal entity.

"Control", in relation to an enterprise, means the possession of sufficient
means to permit substantial direction over the affairs of an enterprise
and, in relation to property, means to acquire or possess.

"Racketeering" means any act, including any preparatory or completed
offenses, committed for financial gain, which is chargeable or indictable
under the laws of the state in which the act occurred and, if the act
occurred in a state other than this state, would be chargeable or
indictable under the laws of this state had the act occurred in this state
and punishable by imprisonment for more than one year, regardless of
whether such act is charged or indicted, involving:

(a) Homicide
(b) Robbery
(c) Kidnapping
(d) Forgery
(e) Theft
(f) Bribery
(g) Gambling
(h) Ursury
(i) Extortion
(j) Extortionate extension of credit
(k) Prohibited drugs, marijuana or other prohibited chemicals or substances
(l) Trafficking in explosives, weapons or stolen property
(m) Leading organized crime
(n) Obstructing or hindering criminal investigations or prosecution
(o) Asserting false claims including, but not limited to, false claims
    asserted through fraud or arson
(p) False statements or publications concerning land for sale or lease or
    sale of subdivided lands or sale and mortgaging of unsubdivided lands
(q) Resale of realty with intent to defraud
(r) Fraud in the purchase or sale of securities
(s) Sale of unregistered securities by unregistered dealers or salesmen
(t) A scheme or artiface to defraud [cons, scams, pyramid schemes]
(u) Obscenity
(v) Child pornography
(w) Prostitution
(x) Restraint of trade or commerce
(y) Terrorism
(z) Money laundering
(aa) Obscene or indecent telephone communications to minors for commercial
     purposes.
                                * * * * * *

RICO laws cover almost every crime for profit. But that doesn't mean RICO
must be used when there are other laws available for prosecution. Examine
all applicable laws to determine which provides the maximum rewards for
CrimeFighters. As a CrimeFighter prosecutor, you can choose which laws to
use, and which law enforcement agency to negotiate with.

                                * * * * * *

A forerunner to RICO, presumably to control drug dealing (it's listed under
Food and Drug laws) is called "Continuing Criminal Enterprises." While CCE
has been more or less replaced by RICO, it's still on the books. Title 21
USCS 886 provides for rewards up to $25,000. CCE is similar to RICO in
wording and intent, but the unusual feature of this law is it's possible
sentences of life imprisonment for ringleaders which can not be suspended
and probation is prohibited. If monetary rewards are not your main concern,
but harsh punishment is, CCE may be used instead of RICO.

                                  The Law

Title 21 USCS 848 Continuing Criminal Enterprise

(a) Penalties; Forfeitures. (1) Any person who engages in a continuing
criminal enterprise shall be sentenced to a term of imprisonment which may
not be less than 10 years and which may be up to life imprisonment, to a
fine of not more than $100,000, and to the forfeiture prescribed in para-
graph (2); except that if any person engages in such activity after one or
more prior convictions of him under this section have become final, he
shall be sentenced to a term of imprisonment which may not be less than 20
years and which may be up to life imprisonment, to a fine of not more than
$200,000, and to the forfeiture prescribed in paragraph (2).

(2) Any person who is convicted under paragraph (1) of engaging in a
continuing criminal enterprise shall forfeit to the United States--

(A) the profits obtained by him in such enterprise, and
(B) any of his interest in, claim against, or property or contractual
rights of any kind according a source of influence over, such enterprise
if:

(1) he violates any provision of this title or title III the punishment for
which is a felony, and
(2) such violation is a part of a continuing series of violations of this
title or title III, and:

(A) which are undertaken by such person in concert with five or more other
persons with respect to whom such person occupies a position of organizer,
a supervisory position, or any other position of management, and

(B) from which such person obtains substantial income or resources.

(c) Suspension of Sentence and Probation Prohibited. In the case of any
sentence imposed under this section, imposition or execution of such
sentence shall not be suspended, probation shall not be granted, and
section 4202 of title 18 of the United States Code and the Act of July 15,
1932 (D.C. Code, secs. 24-203-24-207), shall not apply.

(d) Jurisdiction of Courts. The district courts of the United Sates
(including courts in the territories or possessions of the United States
having jurisdiction under subsection (a)) shall have jurisdiction to enter
such restraining orders or prohibition, or to take such other actions,
including the acceptance of satisfactory performance bond, in connection
with any property or other interest subject to forfeiture under this
section, as they deem proper.
(October 27, 1970
                                * * * * * *

If RICO is used, it has a provision to pay CrimeFighters a negotiated share
in the forfeitures involved. The practice now is to lump all assets, cash
and bank accounts into a forfeiture process rather than impose fines and go
through a separate collection process. Forfeiture under RICO usually means
they take everything they can lay their hands on that can be related to the
offense.

Most states will have a similar list of offenses covered by their RICO
laws. The exception being those activities permitted by law such as
gambling and prostitution in a few counties in Nevada, for example.

Most criminals who have been successful have expensive cars, jewelry, bank
accounts, real estate, stocks and bonds, savings accounts, and other items
of value which can be forfeited as fruits of criminal activity if they
can't prove it was paid for with honest money.

                       Expansion of State RICO Laws

Two years ago, the Texas State prosecutor brought suit to seize a house
owned by a man and a woman arrested on drug dealing charges. Under state
laws existing then, it was difficult to prove that the house had been
purchased with the profits derived solely from drug dealing activity. The
state turned the prosecution of the case over to Federal authorities who
have RICO and other laws at their disposal to seize drug-related property.
That solved that particular problem, but it prompted Texas lawmaker Dan
Morales of San Antonio to pass a new Texas law that would make it easier to
remove the "ill-gotten gains" from criminals, whether drug related or not.

The San Antonio Express-News ran a story on April 15, 1991, with the
headlines: "D.A. tripling asset grabs in felonies."  The essence of the
story is that a new Texas law was passed on October 18, 1990, allows the
Texas State prosecutor to legally seize property used in the commission of
all first and second degree felonies. Until this new State law was
implemented it was possible to seize property used only in illegal drug
deals. The new law expands the number of seizures possible, in effect
tripling the number of forfeitures by including a larger number of felony
violations.

The new law defines contraband used in commission of felonies as "property
of any nature, including real, personal, tangible or intangible."

It also includes any personally owned items such as cash and bank accounts,
guns, jewelry, vehicles, furniture, businesses, and stocks and bonds. While
the courts often seize exotic pets and horses as part of the fines and
forfeitures, the Texas prosecutor wasn't interested in anything that
"eats." But, he is interested in anything and everything of value if it's
connected to the commission of the crime, or considered as the fruits of
illegal activity, as defined by law.

Most States have adopted similar RICO laws which have been expanded in
their scope and coverage to include virtually all illegal activity. For
example, the recent Arizona sting operations involving crooked politicians
who accepted bribes have been prosecuted under Arizona's RICO laws.

                               Hidden Assets

The courts are well aware of the tricks used by crooks to hide their
assets. The most common one is buying a car, boat, airplane, or condominium
in a friend's or relative's name. Another ploy is selling an asset already
owned to someone who is under their control or influence. The amount of the
sale price is usually an amount much less than the fair market value ("$1
and other considerations", for example). The court will investigate. The
legal owners will be required to show proof of where they obtained the
money to make the purchase. If it's proven to be a sham transaction the
court will seize the assets.

The court might discover that a friend, for example, has no job, no money,
and no inheritance to put up the money. In most cases the friend is usually
dependent on the lawbreaker. If he or she can't provide proof of legal
purchase, it will be considered a sham transaction to frustrate the court
(like creditors in bankruptcy actions). The sham transaction will be swept
aside as though it doesn't exist. The courts refer to the second person as
a "strawman" -- one who is without real substance.

If you find your suspect has a lot of assets, but they're in someone else's
name, keep that in mind. They are still vulnerable. All you have to do (as
prosecutor) is to "lean" on the strawmen. Advise them if they don't confess
now, they will be called as a witnesses and forced to testify under oath.
If they lie, and it's proven they lied, they will be guilty of perjury,
which is a felony punishable by stiff sentences. If they tell the truth
right away, you can promise they will escape punishment. In most cases
that's all that's required to get a signed statement.

                                * * * * * *

                             RICO Civil Suits

Title 18 USCS 1964

"(a) The district courts of the United States shall have jurisdiction to
prevent and restrain violations of sections 1962 of this chapter [18 USCS
1962] by issuing appropriate orders, including but not limited to: ordering
any person to divest himself of any interest, direct or indirect, in any
enterprise; imposing reasonable restrictions on the future activities or
investments of any person, including, but not limited to, prohibiting any
person from engaging in the same type of endeavor as the enterprise engaged
in, the activities of which affect interstate or foreign commerce; or
ordering dissolution or reorganization of any enterprise, making due
provision for the rights of innocent persons.

(b) The Attorney General may institute proceedings under this section. In
any action brought by the United States under this section, the court shall
proceed as soon as practicable to the hearing and determination thereof.
Pending final determination thereof, the court may at any time enter such
restraining order or prohibitions, or take such other actions, including
acceptance of satisfactory performance bonds, as it shall deem proper.

(c) Any person injured in his business or property by reason of a violation
of section 1962 of this chapter [18 USCS 1962] may sue therefore in any
appropriate United States district court and shall recover threefold the
damages he sustains and the cost of the suit, including a reasonable
attorney's fee.

(d) A final judgment or decree rendered in favor of the United States in
any criminal proceeding brought by the United States under this chapter [18
USCS 1962 et seq] shall estop the defendant from denying the essential
allegations of the criminal offense in any subsequent civil proceeding
brought by the United States."

                                * * * * * *

Clause (c) is important to victims of RICO related crimes. "Any person" may
sue the lawbreaker in a private suit for THREE times the damages to his
business or property. Instead of a ordinary civil suit to be reimbursed for
actual damages, crime victims should use this law to obtain three times the
business or property damages. (In addition, an "injured party" could also
file personal damage lawsuits in a separate suit. Triple damages probably
doesn't apply in CrimeFighter lawsuits for personal damages, although it
might!) A RICO civil suit should be initiated as soon as possible to lay
claim to the defendant's assets before they are forfeited in the pending
criminal action.

Clause (d) means if a conviction is obtained, or a guilty plea is entered,
the defendant has no legal defense as to the summary judgment that may be
obtained in a civil suit.

As you read the other laws that pay rewards, compare them with RICO for
effectiveness to maximize your rewards.

                            F9 for next Chapter