Illicit business requirements for conviction under the RICO Act

On Behalf of | Mar 3, 2020 | Federal Crimes

Racketeering is a serious federal offense requiring proof that an individual repeatedly engaged in unlawful activities while conducting business through an illicit enterprise. A prosecutor filing charges alleging racketeering must first prove the existence of an illegal organization. 

The enterprise does not necessarily require a physical location such as a store or building. It may involve any means of commercial activity where the exchange of money for goods or services occurs. The enterprise and individual are typically two separate entities; a prosecutor must demonstrate how a working or an employment relationship exists. 

Illicit activities affecting commerce 

The individual generally must conduct his or her alleged wrongdoing through the enterprise, which purportedly harmed foreign or interstate commerce. Transactions may take place online, on the street or through the mail as part of an established entity. Regardless of where it occurs, the activity usually causes damage to a legally established company. 

Offenses qualifying as a racket 

Under the Racketeer Influenced and Corruptions Act, numerous offenses define what law enforcement officials may allege as “rackets.” These offenses include fraud, gambling, dealing drugs, bribery, kidnapping and arson. Fraud, however, has provided a broad reach in which a prosecutor may file RICO charges for activities conducted by phone, online or through the mail. 

Proof of a pattern of rackets 

Once evidence shows the existence of an illegal enterprise and demonstrates that it affects legitimate commerce, a prosecutor must prove an individual engaged in a “pattern” of rackets. To prove a pattern, an individual must have engaged in an action of racketeering at least two times, as noted by CNN. For example, one racket may have occurred on two separate occasions with the same victim, or one action of mail fraud targeted two different victims. 

Time frame and frequency 

Charges filed under the RICO Act must show that an individual carried out an alleged racket at least twice within the past 10 years. The actions, however, must have occurred through an illicit enterprise for a jury to convict. Penalties may include up to 20 years of imprisonment and a substantial fine. 

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